NPD: Consumers Splurging On High-End Beauty


Anyone looking for more evidence that American women are craving a little TLC can stop at the beauty counter: NPD Group reports that the U.S. prestige beauty business climbed 7% to $10.2 billion last year. (In 2011, prestige products, those sold in department stores, gained 11%.) 

“The trend indicates consumers are reinvesting in beauty, and that frugal fatigue has taken hold within the beauty realm,” Karen Grant, NPD’s vice president and senior global industry analyst,  tells Marketing Daily. “Prestige products are outpacing sales of the mass brands, and even the premium products are outpacing the sales of entry-level products.” 

Skincare, with $3.3 billion in annual sales, grew by 10%. Makeup sales increased 7% to $3.8 billion. Fragrance had the smallest growth, with annual sales adding 5% to $2.9 billion. “We think that Hurricane Sandy, which pushed into perfume’s all-important fourth quarter, may have had some effect,” she says.



Sales in many European countries fell, however, led by Spain, with a 7% drop, Italy, down 4%, and France, down 1%. Overall, European skincare sales fell 2%. 

Demographics partially explain the strength in the U.S. market, with aging boomers eager to minimize wrinkles any way they can. “But we are seeing that skincare is resonating with a broader audience looking for preventative care, as well as older consumers looking for corrective products.” 

Sales were also fueled by product innovations, including the strength of ‘couture’ designer scents, alternative makeup brands, and specialty sub-categories, such sonic cleaning.”

Grant says the Port Washington, N.Y.-based market research company expects sales to continue to be strong through this year. “All indications are that 2013 will be similar. The outside macroeconomic trends are robust, so we are looking for single-digit increases in all three categories. Additionally, there’s a lot of innovation, in terms of new color, as well as skincare products focusing on tone.”

She expects those trends to extend to Europe, as well.

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