A primer on the multibillion-dollar global cosmetics market
By Madeline Baumgartner
The world population is aging, and that paints a rosy picture for the cosmetics market. With people aged 60 and over expected to number 2.1 billion by 2050, demand for cosmetics and skincare products will continue to grow. New research by Shop! Environments Association has uncovered key trends to help brands make the most of opportunities in this market. The Shop! Storedits (stor-ditz) program, an annual analytical qualitative survey of retail space, identifies how POP displays are deployed in different categories and retail channels across the world. This year, research focused on the cosmetics and skincare industry in 13 countries across Asia, Europe, and North America. The 2019 study unveiled three new market trends in skincare and cosmetics:
Millennial men are major buyers. As men across the globe become more image-conscious, they are adopting grooming regimes and buying into categories traditionally associated with women, such as makeup, facial cleansers, moisturizers, and exfoliation products.
Multifunctional cosmetics are game changers. Multifunctional products, such as products that combine skincare properties and traditional cosmetics color choices, are set to be game changers over the coming years. Increasing demand within the premium cosmetics category is driven by their capacity to give consumers maximum value, even for the most expensive makeup brands. This finding coincides with recent Mintel research, which revealed that British women want reduced steps in their facial skincare routines.
Technology is omnipresent. Technology plays a role in nearly every area of retail, and the cosmetics industry is no different. High-tech beauty devices are becoming much more prevalent, offering consumers clever new ways to integrate their personal care routines into their homes using technology.
Members of the Shop! Global Network conducted 177 extensive audits in stores globally to identify these and other market trends for the Storedits study. This group of experts reported on how displays and promotional messaging are being used by brands and retailers to appeal to and influence the shopper in store.
Inside the Report
The research explores current and changing global trends, seeking to understand the role of POP across the world and to discover what good really looks like for cosmetics and skincare.
In addition to the findings from in-store audits, the report details the size, composition, and trends of the skincare, makeup, and cosmetics industries. Some highlights:
- The total global cosmetic products market, which includes hair care, oral, and fragrances, was valued at US$532.4 billion in 2017. This burgeoning market is expected to reach a market value of US$805.6 billion by 2023.
- The cosmetics market is not as fickle as we might think; the top 10 leading companies have been market leaders for decades. These, along with smaller companies across the globe, are thriving on the diversity of products and demographics at their disposal.
- Physical stores are an important aspect of the global cosmetics and skincare categories, with shopper demand for “try before you buy” placing them ahead of online retailers. Global sales in both categories are forecast to grow, driven by various consumer trends as well as population growth in emerging markets.
The Storedits program focuses on POP displays in different category and retail channels across the world each year. Last year, the research focused on consumer electronics. The study results reveal contributions from global Shop! members to the growth of this market through innovative displays and marketing. Shop! thanks sponsors WestRock, Duraco, and Hera Lighting for their ongoing support of the Storedits program; POPAI UK & Ireland staff for managing the project, providing analysis, and writing the report; and members of the Shop! Global Network for conducting field work. For a free copy of the 34-page report or last year’s, download here.
In-store Display Trends
While the communication of product info for new and innovative products is vital, pressure remains for displays to hold as much stock as possible. This often results in challenging design decisions to determine how best to use space on display equipment. POP display undoubtedly has a role in influencing shoppers’ purchase decisions, with 17% of shoppers in the United States citing in-store displays as the most influential media in encouraging them to buy a new beauty product.
Indeed, the role of display has always been fundamental to the success of cosmetics and skincare products. Given the intensely personal nature of the relationship between the individual consumer and the products, the opportunity to see, engage with, and compare products has given the sector a unique place in the world of in-store display.