Store Brands Beauty Care Category Poised for Global Growth

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June 17, 2010

The beauty care category has lagged behind other store brands categories that have grown exponentially over the past several years, but it is poised for growth as retailers focus more on product quality and packaging, according to industry analysts.

“Private labels tend to do very well in areas like oral care, hair care, and bath and shower. [Consumers] feel they can trade down to private label products without having a difference in quality,” Carrie Lennard, beauty and personal care industry analyst at Euromonitor International told Beauty Packaging. “…private label only had a 2 percent share of total global beauty and personal care sales in 2009, so it is still very low.”

Target is one retailer successfully making the transition to more premium brands in the category, according to Tom Custer, director of client development for Interbrand, a global brand design firm based in Cincinnati.

“Retailers are putting a lot of emphasis on personal care and beauty products and are offering extensive lines. We will see growth in this competitive category,” he said. “However, there is a lot of confusion in the category because there are a lot of offerings, for example, in the personal care and hair care categories.”

Retailers should take advantage of some of the confusion, he added. “If they can create some impact with package design and placement at the shelf amongst all the confusion, that will benefit them, their private brand and their profits.”

Similar to the consumables categories, beauty care is also seeing consumer interest in eco-friendly products that used less packaging or are made with all natural products.

Innovative packaging is also paying off, according to Allan Burd, president of Lady Burd Cosmetics, based in Farmingdale, N.Y.

“Our clients are always looking for a way to differentiate themselves from the competition and the way to do that is through great products with innovative packaging. During the economic downturn, many of our clients were looking for inexpensive packaging. Now that things are improving a little, clients are cautiously exploring returning to more upscale packaging designs. With uncertainty about the future, costs are still very much a concern,” Burd said.

According to Toronto-based The Beauty Company, new products are driving beauty care category growth. “Retailers have been in somewhat of a hiatus in the past few years and there is definitely a yearning for new and different,” said managing director Diana Pitsolis. The upcoming trend, she added is “less is more,” focusing on simplicity.

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