Few Bright Spots Emerge In Lackluster Year For Cosmetics & Toiletries Industry.

After another year of disappointing sales, cosmetics and toiletries marketers are faced with steadily dropping growth rates. According to data recently released by Kline & Company, the U.S. C&T market grew by less than 2% in 2003. This represents the third consecutive year of low single-digit growth for the market after it averaged roughly 5% annually through the late 1990s.

“C&T companies have been finding it difficult to generate excitement in a mature market that is saturated with many competing lines,” says Carrie Bonner, consumer products industry manager for Kline. “Even some of the product classes that had fairly successful new product launches still saw sales declines or weak growth overall.”

Bonner points to the hair care products class, which featured three of the largest product launches from last year — the Dove and Garnier Fructis shampoo and conditioner lines and the L’Oreal Couleur Experte hair coloring line. Despite the success of these major launches, the product class managed to grow by less than 2% overall.

Of the 34 product categories examined in the upcoming edition of COSMETICS AND TOILETRIES USA, Kline’s annual market analysis, more than half recorded sales declines from 2002 to 2003. Bonner notes that some of these categories,
including hair coloring and sun care products, experienced a drop in sales for the first time in decades.

Some categories, however, did benefit overall from new launches of novel product lines. Sales of eye makeup increased by more than 10% from 2002 to 2003, mainly on the strength of advanced formulations of mascaras and unique eye shadows. And although the skin care product class as a whole only made modest gains, Kline’s study predicts that skin care will continue to capitalize on some of the hottest industry trends and offer excellent prospects for future growth.

As sales of anti-aging products and high-priced clinical brands continued to rise, the facial treatments category grew at a rate four times higher than the industry average. Men’s skin care products offered the largest sales growth rate — reaching nearly 15% from 2002 to 2003, albeit from a small base — and Kline is currently undertaking a separate market study, THE U.S. MALE GROOMING MARKET 2003, that focuses on this largely untapped market.

“Skin care is definitely one of the bright spots in a market that otherwise has been pretty flat,” says Bonner. “The other categories will need some more innovative new brands and product forms to pump some life back into them.”

For more information at http://www.klinegroup.com