11.07.08
U.S. Prestige Beauty Sluggish but Stabilizing
According to new statistics culled by NPD Group, Inc., Port Washington, NY, the U.S. prestige beauty industry is showing signs of stabilizing after a slow start to the year. The total U.S. prestige beauty market (defined by NPD as products sold in U.S. department stores) for the first half of the year was $3.8 billion, down 1% compared to the same period in 2007, but the declines are not as strong as they were in the first quarter of this year. In fact, the second quarter of 2008 was the strongest quarter in the past three years, according to NPD.
Skin care proved to be the bright spot in the market, as it was the only category showing growth during the first half. Sales rose 2% to $1.2 billion. According to NPD, the first half of 2007 included an extra week in January causing sales to be slightly inflated that year. Without that additional week in 2007, prestige skin care sales would have shown an even healthier performance, the group said.
Premium-priced facial skin care products—those $70 and above—continued to outpace overall prestige skin care, growing 8% to $365.1 million in the first half of 2008, according to NPD.
Makeup sales dropped 2% to $1.6 billion, with sluggish performance in the first quarter. However, a strong April and May pushed second quarter sales up 3%, marking the strongest quarterly dollar performance over the past three years in the U.S.
Prestige fragrance sales fell 3% to $1 billion, according to NPD. More info: www.npd.com
Are Your Customers Eco-Centric or Eco-Chic?
Not all green customers are created equal. According to new analysis from Information Resources, Inc. (IRI), there is significant disparity in how well environmentally conscious consumers actually follow their convictions by purchasing environmentally friendly products—and those convictions factor heavily into repeat purchase decisions.
According to Robert I. Tomei, IRI’s president of consumer and shopper insights, 82% of the population claims to make going green a priority, “but as this data proves, the behaviors of those consumers vary drastically. While certain green conscious consumers do make a concerted effort to buy green products, there are certain segments of the population that are environmentally sensitive but that does
Is she really green? |
The IRI analysis comes via research based on TNS’ Shades of Green, a consumer segmentation approach generated from a comprehensive global environmental survey of thousands of individuals. By analyzing survey responses, TNS separated consumers into eight distinct attitudinal segments based upon environmental concerns. By applying the TNS Shades of Green segmentation to its U.S. Consumer Network purchase panel, IRI was able to link the attitudes that individuals have toward the environment with their actual shopping and purchasing behavior to determine whether “concerned” individuals actually follow through by purchasing environmentally sound products.
According to IRI, despite containing individuals who claim eco-friendly beliefs, two key environmental attitudinal consumer segments—the “eco-centrics” and the “eco-chic”—show extremely different behavioral patterns related to green product purchases. While eco-centric consumers have shown a willingness to change their buying behavior and a commitment to use of environmentally-friendly products, the eco-chic segment, comprised of younger, more trend-influenced consumers, appears more interested in riding the wave of environmental consciousness by claiming to embrace environmental concerns, but not following through with their dollars.
Eco-chic consumers did show a willingness to try some green products at a comparable rate to the eco-centrics, but unlike the eco-centrics, the eco-chic consumers ultimately returned to their favorite non-green brands. For example, the eco-chic group was quick to purchase products from a recently launched eco-friendly household cleaning line, according to IRI, but their repeat rates for the same products were well below the general population average. In addition, when asked to choose between taste and perceived quality versus environmental friendliness, they ultimately chose the former as seen by lower than average purchasing of eco-friendly food and beauty items in categories, including cereal, milk, oral care and skin care.
On the flip side, the eco-centric segment, comprised of high-income, educated urbanites actively doing their part to protect and improve the environment, truly appears to follow through on their environmental beliefs with purchases of eco-friendly products. In 15 of 16 eco-friendly product groups analyzed, eco-centrics tried products at a rate above the general population. Their willingness to try eco-friendly products spans from their food and beverage purchases to their personal care and cleaning product purchases, including oral care, skin care and laundry detergent. And, what really matters to manufacturers is that they continued to purchase these eco-friendly products illustrating their long-term environmental commitment. According to IRI, there were especially high repeat indices for dish detergents.
“Given some of the obvious issues that consumers face in today’s market, such as high gas prices, higher unemployment rates and concerns over the financial investment community, it will be increasingly more challenging for many consumers to incorporate their sensitivity to the environment into their actual behavior, particularly for those green products that may cost more to purchase,” said Mr. Tomei. “This analysis proves not only the efficacy of the Shades of Green segments in defining consumers to target, but also the undeniable importance of green positioning to manufacturers and retailers.”
More info: http:usa.infores.com
Consumers Go Online To Stretch Holiday
Budget in Tough EconomyLate nights spent surfing the internet may help credit-crunched consumers save cash this coming holiday season. According to Burst Media’s surveys of more than 3000 internet users ages 18 and older about expected use of the internet for the upcoming holiday season, economic woes quickly impacted consumers’ holiday spending plans. The Burlington, MA company found that the number of consumers who plan to spend less this holiday season increased in the four weeks between its August and September surveys.
In a statement, the company said that while it “cannot correlate this change with the economic climate, September data shows a significant shift from our earlier reading.”
Other findings showed that moms 45 years and older will be more frugal, with 43.8% planning to cut holiday gift and entertainment spending. Men, too, appear to have been affected by the dismal Wall Street headlines. In the August survey, 21.5% of men planned to cut holiday spending. In September, that number rose to 32.5%.
Additionally, respondents reporting high household income planned to pull back their holiday spending. In September’s survey 39.3% of respondents reporting household income of $75,000 or more plan to spend less on gifts and entertaining this holiday season, compared to 25.3% in August.
According to Burst Media, consumers will be looking to stretch their dollars online. More than 55% of respondents expect to make a holiday gift purchase online, up from 48.8% who made an online purchase in 2007. Web prowlers will also use the internet to research potential holiday purchases, including comparing different retailers to find the best price, according to the company.
“Advertisers will need to redouble their efforts to reach consumers online,” said Chuck Moran, vice president of marketing for Burst Media. “In a very challenging holiday season the internet can serve as an effective medium to reach target audiences and maximize the efficiency of media budgets. Online media advertising also affords marketers the flexibility to quickly tailor advertising and offers for changing market conditions as they happen.”
More info: www.BurstMedia.com