That's some of the juicier insight coming from the NPD Group's industry analysis released this week.
Prestige color cosmetics were the top-selling segment, beating out fragrance and skincare products. Makeup sales last year increased 3%, to $3.1 billion, versus fragrance, which was down 2%, to $2.9 billion, and skincare, up 1%, to $2.2 billion in 2006.
According to NPD, which has been tracking the industry and dollar share, the largest growth areas in color were in the face and eye sub segments, with face representing almost half of total makeup dollars with a gain of 3% to sales of $1.4 billion.
What's driving much of that growth are new-product areas, one of the biggest being mineral-based foundations. The trend of crushed mineral, powder-like foundations started with the rapidly growing niche company Bare Escentuals. That brand, once sold only on home shopping television networks, has seen competitors, such as Urban Decay, Laura Mercier and others rush to the market with similar products.
Beyond minerals, natural-ingredient positioned toiletries, which became popular in the 1970s and the re-emerged in the 1990s with the relaunch of Clairol Herbal Essences, have seen a resurgence, especially in skin care, and color cosmetics.
Some even link the trend to not just clear, healthy skin but actually green marketing and environmental issues. "Green beauty is reflecting changing world beliefs," says Karen Grant, senior beauty analyst at the NPD Group. "The recent popularity of mineral makeup illustrates that natural ingredients are resonating with consumers and have broad appeal. We see natural ingredients as being part of a lifestyle rather than just a trend ... this is just the tip of the iceberg."
Another key growth area NPD highlights is makeup artist, designer and alternative brands, falling under the niche and specialty categories with the likes of Smashbox and Urban Decay and others making up 39% of dollars spent in the prestige-beauty category.
Despite the huge rush of new fragrance brands and category noise from celebrity launches, NPD attributes slower-than-usual 2006 holiday sales-which generally account for almost half the fragrance business in a given year-for the year's decline. In fact, of last year's new launches, NPD cites designer fragrances such as Vera Wang Princess and Juicy Couture as adding the most incremental category sales.
In skin care, the biggest shift may be a leveling off in sales of all those cosmeceuticals and dermatologist brands that have been causing a stir for the past five years. Brands such as Dr. Perricone, Dr. Brandt, Cellex C, and StriVectin now account for $235 million of skin category sales, or 11%, versus a 1% dollar share in 1997.
But unlike proven stalwart brands such as Clinique, Estee Lauder and Lancome, most of the doctor and doctor-inspired brands may actually turn out to be more of a passing fancy among consumers than brands with bona fide staying power.
At least that's according to NPD, noting that older brands in the sub segment were starting to fall. "Cosmeceutical and clinical brands have been a driving growth factor in prestige skin care, but we are seeing existing brands, those that have been on the market for more than two years, starting to show some declines," says Grant. "The growth is coming from the new brands and this is really the first sign of a slowdown in this area of the industry."