Rethinking Beauty: Exploring New Growth Models

October 2013

As the beauty industry gears up for another challenging year of economic uncertainty, companies must offer the right mix of quality and value, and look beyond traditional markets. In a recovering global environment, there is scope for upscale targeted solutions, which offer not only technically advanced formulations but increasingly personalised services. At the other end of the scale, a one-size-fits-all approach seems to suit a lifestyle where value-for-money and time-saving are paramount.

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Global beauty growth accelerates

The global beauty industry saw another strong performance in 2012, and industry growth bettered that of the previous year, reaching pre-recession levels with total sales of over US$433 billion globally.

Brazil remains the star of the beauty industry

Brazil posted its strongest growth since 2004, registering a staggering 17% gain, close to double 2011’s 9% increase, making it the star of the industry in 2012, but with less optimistic prospects for 2013.

Mass dominates but premium outperforms mass in most markets

Mass cosmetics continue to dominate sales and represented 75% of value sales in 2012. However, in 49 of the 80 markets, premium sales outperformed mass in 2012, leading to a strong rebound in premium cosmetics globally. Nevertheless, the mass segment still saw faster growth than premium globally.

Skin care is powerhouse of the industry

Continued demand and innovation in skin care helped the category reach the US$100 billion mark in 2012, and it continued to account for over one fifth of total market sales.

Space for both multi-functional and targeted offerings

Both targeted and multi-functional products are sought after by consumers; however, the need for stressing the primary benefit of a product should remain key in future innovations.

Emerging markets to fuel growth in future

Global beauty sales are projected to grow at an annual average real growth of 3% between 2012-2017, with growth set to be higher in the emerging markets than in the developed markets led by China and Brazil, despite a slowdown expected in both markets. The industry needs to be mindful of relying too heavily on emerging markets to shore up growth and explore niche segments and innovation across developed markets.

What this report includes

  • Top-level strategic analysis of how major consumer trends will influence global markets
  • Consumer insight
  • Impact across all relevant consumer markets
  • Unique graphics and case studies
  • Key market snapshots
  • Accompanying presentation to synthesise main findings

Why buy this report

  • Identify factors driving change now and in the future
  • Understand motivation
  • Forward-looking outlook
  • Briefings and presentation should provoke lively discussion at senior level
  • Take a step back from micro trends
  • Get up to date estimates and comment


Key findings

State of the Industry: The Highlights

Beauty industry remains steady
Brazil and India stay s trong while China slows down
Mass continues to dominate
Premium growth outperforms m ass in most m arkets…
…But mass still outperformed total beauty growth globally
Premium skin c are l eads premium beauty growth
Skin care i nnovation pronounced a cross b oth p remium and mass

Key Opportunity Zones

Most categories improve their p erformance on the previous y ear
Opportunity varies by region
Skin care dominates but hair c are is catching up
Top growth s egments i ndicate a shift in positioning
Nail polish continues to outperform l ipstick
Shifts in consumption across s kin c are and facial m ake-up
The revival of facial m ake-up
Further scope for men’s skin c are
Men’s toiletries set to overtake m en’s s having in 2013
Focus on men b ecomes m ore t argeted

Innovation Concepts

Redefined consumer p rofile o pens n ew i nnovation s tream
Hair care transforms into a multifaceted c ategory
The fashion and beauty r elationship k eeps b ooming
Fashion and beauty convergence b enefits b rand profile
Fashion and beauty m ove in similar d irections
Targeted specialisation t ranspires in different areas
Innovation in targeted s olutions
Bespoke solutions and diagnostic services p resent future scope
Anti-ageing shifts into a broader context
Innovation in multi-purpose offerings
From niche to mainstream: The evolution of the BB cream
Specialisation should r emain key in multi-benefit combinations
Room for both multi-functional and targeted offerings

Future Prospects

Mass expected to continue to dominate in future
China and Brazil: The powerhouses of beauty despite slowdown
Latin America and Asia Pacific to lead future growth
Conditioners are set to see strong growth

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