Global megatrends in beauty & personal care

Global beauty and personal care maintained steady growth in 2016. However, at constant 2016 prices, growth stood at a low 1.7%, as inflation impacted Latin American markets. This scenario is mirrored in volume terms, where global growth slowed to 1.5% in 2016, dragged down by Latin America. As generations Y and Z gradually outnumber baby boomers, their preferences will take the lead and reverberate across the industry. Related megatrends such as digitalised lifestyles and holistic wellbeing will go mainstream.

E-commerce was the fastest-growing retail channel over 2011–2016. This is emboldening beauty brands, big and small, to operate online in novel ways, notably social selling and subscription boxes, which are expected to proliferate as consumers can be reached more widely via social media. Experience is in demand as more consumers have access to on-the-go information. When they need something, they want it now. No surprise: E-commerce is the fastest-growing distribution channel in the beauty industry. With beauty devices, consumers receive real-time feedback that allows them to purchase the right product over what “feels” like the right product. As smart devices and app-based diagnostics become ubiquitous, consumer expectations will shift as personalisation becomes achievable, based on real-time updates that encourage users to track results and choose products that exactly fit their needs.

Smart technology is standardising personalised beauty solutions. Going forward, personalisation facilitates expansion, as brands seeking to widen their offer can more accurately meet consumer needs by informing line extensions with insights obtained from the delivery of personalised offerings. Ethical living gives life to personalised solutions; augmented reality and smart diagnostics are all shifting beauty purchases from mere possessions to experiences, as aspirations fuel consumers’ search for the right products that instantly deliver real change. Starting with demand for natural products, it is now extending to include clean labels, ethical credentials and sustainable sourcing. Consumers scrutinise not only safety and efficacy, but also ethical considerations in a product’s development.

The dynamic premium segment is driving inevitable premiumisation among mass brands to be able to compete. “Masstige” is a thriving segment, and with quality and efficacy being key differentiators, premium brands are upping their game and compete on grounds of authenticity and personalisation. Healthy living is a growing trend among consumers. Holistic well-being is not limited to food nutrition and active lifestyles. Other industries, notably apparel and beauty, are creating new lines to support active consumers. New benefits such as microbiome skin care and muscle recovery are emerging. Competition in the beauty industry is extending beyond its conventional borders to include pharmaceutical and food and beverage players, which now boast numerous products claimed to support skin and hair health among other body functions.

Author: