• by Karl Greenberg , May 15, 2007

A newly released study by Chicago-based Mintel on March sales of shampoo and conditioner in the U.S. shows that conditioners are driving growth in the hair-care market, although shampoos have a higher overall share of the market.

The study also shows that the shampoo market, including the crowded mass market and high-end brands and variations, resembles flora in a tropical rainforest, with a profusion of products in ever more colorful packaging to compete for consumers who are overwhelmed by choices.

Also, per the consultancy, the hair-care market is experiencing the kind of "mass-tige" trend that has come to define everything from cars to candy, with high-end products--in this case salon-quality products--pervading the mass market.

The study comes out as P&G's Pantene, the market leader in shampoo, launches a brand redesign effort with new ads due out later this month, along with point-of-purchase material, redesigned packages and promotional activity.

Mintel says growth is driven by higher-priced products touted for salon quality. Per Mintel, 28% of respondents believe salon products are worth paying a premium for, with Matrix and Redken products, originally distributed only in salons, showing quick sales growth as they have been diverted to the general market.

Rachael McFarland, U.S. cosmetic research analyst with Mintel, says that Pantene has been successful in part because it is associated with salon-quality hair products. "So, it's a little different than some of the other mass-market products. When you walk down the shopping aisle looking at packaging of some other mass-market products, a lot of packaging tends to be bright and trendy with a focus on a younger demographic, but Pantene didn't go that route."

She points out that Pantene and Suave, the leading shampoo brands, and also leading brands in every age group, compete on premium quality and value, respectively, and that re-launching with new packaging isn't enough to succeed if consumers question the products' efficacy.

Still, per Mintel's research, based on surveys of 12,830 adult females, Pantene owns 23% of the 18- to-24-year-old market, 25% of the 25- to-34-year-old market, and 22% of the 35- to-44-year-old market. "What's unusual about them is that they have such a large following in almost all of the age demographics. They are doing well in all segments, even in the 65-plus category," she says.

She says Pantene's new shelf strategy will involve five categories, including healthy look, therapeutic and ethnic. "If you want to stay ahead in this business, with so many product launches coming out every month, you have to differentiate yourself on the shelf, you have to make it easier for consumers walking down the aisle to pick out your products; they should be able to go to that column and pick it out, rather than look at each individual bottle."

She also says it may be misguided to focus solely on younger demographics. "Particularly as the median age of the U.S. population increases, it may be more effective to devote ad dollars to more mature females and the family shoppers [Pantene and Suave remain more popular among teens]," she says, adding that Mintel research indicates that consumers under retirement age are roughly equal in their brand loyalty and in their likelihood to use product designed for their hair type. "The role of twenty-somethings as opinion leaders in this category is tentative at best."

Per Mintel, the 2006 shampoo and conditioner market was $4.1 billion, with shampoo accounting for 60% of the market, versus 50% for conditioners, though conditioners grew at twice the rate of shampoos between 2004 and 2006.