12.02.08
Anxiety Over Economy Curtails Consumer Spending
Anxiety, insomnia, fear—that’s what women say they feel today, showing that this group has been drastically affected by the economic downturn both in their spending habits and their psychological well being, according to a survey by BettyConfidential.com. In the survey of more than 100 women, 75% of respondents indicated that on a scale of 1 (not at all) and 10 (extreme), their anxiety about the economy rated a 6 or higher, with 20% choosing 8 and 21% choosing 9.
What worries women most? In a nutshell everything, said BettyConfidential.com Answers ran the gamut from affording groceries and other staples like gas (25%) to a wide variety of fears, such as: “losing what took so long to acquire,” job loss, “keeping my husband’s and my businesses,” making credit card payments, and a general fear for the country’s future, such as the “destruction of economy,” “things getting worse in the country and it affecting me,” and “the state of our country and how we are leaving it for our children.”
A vast majority of women (83%) reported that their spending habits have been affected. It’s hitting women and their families everywhere, from having to take on second jobs or work more hours or scrimp on basics. Yet the study found that even with the downturn in the economy, women are still willing to make small purchases to treat themselves and give themselves a boost. And it appears beauty products beat chocolate and lingerie. In response to the question, “In this economic downturn, what small purchase most comforts you?” respondents answered: Beauty products (18%); manicure/pedicures (18%); chocolate (16%); new shoes (10%); and lingerie from Victoria’s Secret or Gap Body (3%). More info: www. BettyConfidential.com
U.S. Cosmeceuticals Market To Top $8 Billion by 2012
Demand for cosmeceutical products is expected to increase 7.4% a year to $8.2 billion in 2012, driven by an aging populace seeking to youthful appearance in an image-conscious society, according to a new report from Freedonia Group. This, coupled with an increasingly competitive work force, a steady stream of new and technologically-advanced product introductions and the continuation of astute marketing, will bode well for the cosmeceuticals marketplace.
On the flipside, limiting further gains will be growing pricing pressures and intense competition from alternative treatments, including laser resurfacing and various cosmetic surgical procedures.
According to the Cleveland-based industry research firm, injectables and skin care products will register the fastest growth in the market. Growth of injectables will be fueled by their ability to provide quick wrinkle reduction without recovery time. Further propelling gains will be the FDA approval of new injectables—such as calcium hydroxylapatite—that provide long-lasting results.
In addition to achieving above-average growth, skin care products will remain the largest product category, set to account for 63% of all cosmeceutical product demand in 2012. Age-defying products will achieve above-average growth, with gains driven by a highly receptive, fast-expanding group of middle-aged consumers, as well as a growing number of younger individuals, who want to redress or prevent visible damage to the skin caused by aging, ultraviolet radiation and other environmental stressors.
In terms of raw materials, antioxidants will remain the largest category, with above-average gains promoted by their incorporation in both topical and ingestible formulations. Botanicals and enzymes, as well as hyaluronic acid, amino acids and peptides, are among the active ingredients set for favorable opportunities in a variety of cosmeceutical products. More info: www.freedoniagroup.com
Fair Trade Cosmetics Gain Momentum
As the European market for natural and organic cosmetics gets ready to break the $2 billion barrier for the first time this year, there’s greater interest in fair trade policies as well as green chemistry and packaging. According to new report on fair trade cosmetics and ingredients from Organic Monitor, many companies are implementing fair trade sourcing policies, with some launching certified fair trade products. Most product launches have been in the French market, which now has the largest number of cosmetic products with the internationally recognized Fair Trade mark.
According to Organic Monitor, although The Body Shop has been the pioneer in ethical sourcing with its Community Trade program, the company is losing out to newcomers. A number of natural and organic cosmetic companies are setting up fair trade grower projects in Africa, Asia and Latin America. Some are growing endangered plant species and investing in social community projects.
The London-based consultancy’s report evaluates the business potential of fair trade cosmetics and ingredients, giving details of standards, certification and market potential. The study predicts adoption rates to rise as natural and organic cosmetic products become mainstream and as more certified fair trade ingredients become available. A major restraint to market growth is the limited number of certified fair trade ingredients.
According to Organic Monitor, the mainstreaming of the natural and organic cosmetics market is encouraging fair trade practices. Firms such as Weleda, for example, are investing in fair trade projects to guarantee supply of organic ingredients and to encourage sustainability. The entry of large cosmetic companies and leading retailers is straining supply of natural and organic cosmetic ingredients. Corporate social responsibility is also coming to the forefront as brands compete for limited retailer shelf space.
With a growing number of natural and organic cosmetic companies adopting fair trade practices, Organic Monitor predicts some convergence between standards. A number of organic certification agencies are already integrating fair trade practices into their standards, and this will enable cosmetic companies to bridge the gap between green and ethical products, according to organization, and the markets for fair trade cosmetics is expected to rise, the organization noted.
More info: www.organicmonitor.com
More Than 80% of U.S. Adults Exhibit Some Green Motivation
According to new research by Natural Marketing Institute (NMI), more than 80% of the total U.S. adult population shows some type of green motivation. While LOHAS consumers (those identified as having the strongest environmental, social, and corporate social responsibility values and behaviors) represent just 17% of U.S. adults (38 million consumers), NMI has identified three other segments that are also engaged in various realms of sustainability depending on the eco-dimension that aligns with their overall priorities. Here are other segments identified by NMI:
Naturalites (17% of all U.S. adults)—This group is driven by personal health and wellness and adhere to a healthy lifestyle. They are high purchasers of eco-consumables, want to do more for the environment and are loyal to those companies/brands who practice credible CSR.
Drifters (24% of all U.S. adults)—Driven by trends, drifters are currently engaged in sustainability though their behaviors are not deeply rooted. They are price sensitive and are more likely to be eco-concerned if affected personally.
Conventionals (26% of all U.S. adults)—This very practical segment does not have a green attitude but does have some environmental behavior such as recycling, energy conservation, and other similar behaviors. This segment’s behavior is driven more by cost savings or a desire to waste less than by environmental consciousness.
Unconcerned (16% of all U.S. adults)—While not necessarily against the environment, this group is not actively engaged in protecting it, buying green products or CSR.
According to NMI managing partner Steve French, while the percentage of LOHAS consumers has remained stable since 2005, all of the other segments show noteworthy shifts. The so-called drifters and conventionals, in particular, have increased significantly, which is reflective of both rising environmental and social concerns, as well as the current economic situation, said NMI.
NMI notes that marketers will continue to find value in understanding the attitudes and behavior of LOHAS consumers, as they are bellwethers of more mainstream consumers’ future behavior. Having driven the market, they are now discovering the next generation of green and socially conscious products. Given the growth in drifters, marketers need to communicate the caché and camaraderie that a green lifestyle creates. The growing conventionals segment will respond to messages of practicality or financial savings that can accompany a sustainable lifestyle, as with taking a reusable shopping bag to the store or driving less.
More info: www.NMIsolutions.com