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    Breaking News

    Prestige Beauty Grows 6% in 2018

    The NPD Group reports sales of $18.8 billion in the market.

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    01.29.19
    The US prestige beauty industry reached $18.8 billion in 2018, a 6% sales increase over 2017, according to The NPD Group. The skin care category grew by 13% and contributed 60% of the industry’s total gains; makeup, the industry’s largest category based on sales, grew 1%, while fragrance closed the year up 4%. Hair was the smallest yet fastest growing category, with a 25% increase in sales. 

    “If I had to use one word to characterize the state of the US beauty industry today, it would be disruption. Whether we look at categories, brands, or retailers, there are sweeping changes taking place to the market landscape,” said Larissa Jensen, executive director and beauty industry analyst at The NPD Group. “New retail concepts and technologies are changing the way we create, market, purchase, and use beauty products. Brands and retailers must not only be cognizant of these transformations and act upon them, but identify new white space opportunities to captivate consumers and further differentiate themselves from the crowd.”

    Skin care sales were $5.6 billion for the year, and natural brands remain a top contributor to growth. Natural skin care accounted for $1.6 billion or more than one-quarter of annual sales, up 23% versus last year. The fastest-growing segments within facial skin care were lip treatments, toners/clarifyers, and all other face (which includes products like facial sprays and alphabet creams, among others). Skin care for the body grew, as well as sun products including sunscreen and self-tanners.  

    Makeup sales reached $8.1 billion in 2018, and though it experienced soft growth the category holds promise, as the number of consumers using makeup reached 67% in 2018 – an increase of 6% points over two years ago. Among the fastest growing areas were makeup setting spray/powder and false eyelashes. Small remains a big opportunity in makeup; travel size products grew faster than all others, up 29 percent versus last year.

    Fragrance sales totaled $4.3 billion, driven by juices, which grew by 8%. Artisanal fragrance was the fastest growing aspect of the market. Growth in home scents slowed compared to last year, but diffusers were the fastest-growing in that market. 
     
    “Given the high adaptability of the beauty industry, I expect growth to continue in 2019, though it may be at a slower pace given the current economic uncertainties,” said Jensen. “I expect we’ll see an amplification of trends and themes that have already taken shape, including brand transparency, heightened importance of companies taking a stance on key social issues, as well as the evolution of experiential retail and pop-up concepts.” 
     
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