Still Pampering? Opportunities and Challenges Facing the Global Spa and Beauty Industry

EXECUTIVE SUMMARY

Demand Factors

Chart 1 Consumer Expenditure on Personal Care by Country 2009

Beauty Industry Trends

Hair and beauty trends
Spa trends
Tanning and nail salon trends

Consumer Market Trends

Chart 2 Global Sales of Selected At-home Beauty Products 2009

Outlook

Summary 1 Opportunities and Challenges for the Beauty Services Industry to 2014

DEFINITIONS

Consumer Expenditure

Personal care

Retail Sales

Hair care appliances
Other personal care appliances
Salon hair care
Self-tanning
General purpose body care

Spas

Destination spas
Hotel/resort spas
Other spas

DEMAND FACTORS

Affordable Indulgence

The Pleasure Principle
The Lipstick Effect
The quest for value
Anti-ageing remains recession-proof

The State of the Economy

Table 1 Real GDP Growth in Selected Countries 2007-2010

The Importance of Leisure

Striving for a better work-life balance
Leave patterns

Cocooning

Celebrity Culture

Living the dream
Influence on the young
Use of celebrities in marketing

The Metrosexual Movement

Changing attitudes towards masculinity
Trend reaches emerging markets

Consumer Expenditure on Personal Care

Chart 3 Per Capita Expenditure on Personal Care by Country 2009
Table 2 Consumer Expenditure on Personal Care by Country 2004/2009
Table 3 Personal Care as a % Total Consumer Expenditure by Country 2004 2009

BEAUTY SERVICES

Overview

Definitions becoming blurred
Salon versus at-home treatments
Marketing beauty services

Hairdressing Salon Trends

A consolidating market
Major hairdressing chains
Summary 2 Leading Hairdressing and Beauty Chains 2009
Discounting
Natural products
Demographic changes offer opportunities
Growth in men's salons
Pop-up salons
Retail sales through salons
Chart 4 Global Retail versus Salon Hair Care Sales 2004/2009

Beauty Salons

A fragmented market
European preferences
Table 4 Professional Treatment Trends by Major European Market 2008
Trends in skin treatments
Trends in hair removal
Beauty on the move

Spas

The spa market
Table 5 Number of Spa-Goers by Leading Market 2007
Spa trends in Europe
Table 6 Rates of Spa-going by Major European Market 2008
Spa revenues
Chart 5 Spa Revenues by World Region 2007
Gender differences
Table 7 Spa-goers by Gender in Major Markets 2007
Reasons for going to a spa
Table 8 Comparative Importance of Reasons for Visiting a Spa in the US 2009
Types of treatment
Luxury spas hit by recession
Day spas fare better
Retail spas make an appearance
Discounting and special deals
Improving customer service
Natural ingredients fuel growth
Growth in medical and dental spas
Spa tourism
Spa retail
Chart 6 Average Expenditure on Spa Retail Products by Major Market 2008

Tanning Salons

The rise and fall of indoor tanning
Anti-tanning publicity
Legislative changes
Growth of chains
Mega salons
Widening target market
Expanding services
Salon retail

Nail Salons

Market size
Chart 7 Nail Salon Services Market Size in the US 2005-2009
Expanding services
Chart 8 Leading Services Offered in US Nail Salons 2009
Safety issues
Salon retail

BEAUTY-AT-HOME

Home Hair Care

Consumers forgo salons for home treatments
Higher demand for professional appliances
Salon hair care loses share to "professional" mass brands
Colourants benefit from launch of fast treatments
Table 9 Sales of Hair Appliances and Hair Care Products 2004/2009

Home Tanning

Self-tanning benefits from backlash against UV rays
New product development in self-tanning focuses on convenience
Chart 9 Sales of Self-tanning Products 2004-2009
Self-tanners versus gradual self-tanners
Table 10 Self-tanning Trends in Europe 2008
Table 11 Self-tanning Trends in Europe by Gender 2008

Home Nail Care

Table 12 Sales of Nail Products by Subsector 2004/2009

Home Beauty and Relaxation

Skin care fuelled by need to self-treat
Anti-agers and slimming products see surge in interest
Pampering appliances small but growing segment
Table 13 Sales of Depilatories, Skin Care Products and Appliances 2004/2009

MARKET SNAPSHOTS

China

Hair and beauty services
Spa services
Table 14 China: Spa Revenues 2004/2009
Retail sales
Table 15 China: Retail Sales in Selected Sectors 2004/2009

France

Hair and beauty services
Spa services
Table 16 France: Spa Revenues 2004/2009
Retail sales
Table 17 France: Retail Sales in Selected Sectors 2004/2009

Germany

Hair and beauty services
Spa services
Table 18 Germany: Spa Revenues 2004/2009
Retail sales
Table 19 Germany: Retail Sales in Selected Sectors 2004/2009

Italy

Hair and beauty services
Table 20 Italy: Sales of Cosmetics and Toiletries Through Salons 2007-2008
Spa services
Table 21 Italy: Spa Revenues 2004/2009
Retail sales
Table 22 Italy: Retail Sales in Selected Sectors 2004/2009

Japan

Hair and beauty services
Spa services
Table 23 Japan: Spa Revenues 2004/2009
Retail sales
Table 24 Japan: Retail Sales in Selected Sectors 2004/2009

UK

Beauty services
Chart 10 UK: Hairdressing and Beauty Establishment Revenues 2002-2006
Chart 11 UK: Number of Hairdressing and Beauty Establishments by Type 2008
Spa services
Table 25 UK: Spa Revenues 2004/2009
Retail sales
Table 26 UK: Retail Sales in Selected Sectors 2004/2009

US

Hair and beauty services
Tanning salons
Chart 12 Nail Salon Services Market Size in the US 2005-2009
Table 27 US Salon Statistics 2008-2009
Spa services
Table 28 US: Spa Revenues 2004/2009
Spa treatments and products
Chart 13 Most Booked Spa Treatments in the US 2009
Chart 14 Spa Purchases in the US 2009
Retail sales
Table 29 US: Retail Sales in Selected Sectors 2004/2009

FUTURE OUTLOOK

Trends to Watch

Depressed economy will drive need for escapism
Table 30 Forecast GDP Growth by Country 2010-2014
Further consolidation will occur
Flexibility will be key
DIY beauty
Safety concerns will continue to plague tanning salons
However, growth opportunities exist
Demographic changes to favour beauty industry
Growth of men-only concepts
Room for growth in spas
Chart 15 Forecast Global Spa Revenues 2009-2014
Professional products to benefit over longer term
Potential in emerging markets

Forecasts

Future bright for skin care
Natural products will prevail
Combining convenience with efficacy
Salon hair care to face further threat from diverted brands
Mixed future for self-tanning
A future in pills?
Appliances to be driven by new product development
Table 31 Forecast Global Sales of Selected Beauty Products 2009/2014

---