var disqus_url = '';

Kline Releases Cosmetic Fall Preview


LITTLE FALLS, N.J.—Kline released its Fall Preview—estimates of how 2011 is appearing to shape up for the cosmetics and toiletries industry, based on what it has heard and seen thus far.

Overall Market

The overall cosmetics and toiletries market in 2011 should demonstrate growth slightly higher than 2010; most likely sales will be up 3.1 percent to 3.6 percent, as opposed to last year’s 2.4 percent.


Cosmetics and toiletries brands in the mass trade class are estimated to be increasing 2 percent to 3 percent for the year of 2011, continuing along the same track as during the recession. Procter & Gamble, the largest company in the mass personal care space, reported sales growth YTD in 2011 as 4.6 percent higher year on year; but as its fiscal year ended June 2011, the company stated the increase was in spite of little growth in developed markets. Beauty grew 3 percent in the fiscal year ending June 30, 2011, and grooming grew 5 percent.


After spotty sales in the past five years, prestige cosmetics and toiletries brands are clearly triumphant in 2011. Early estimates indicate the whole year 2011, including the upcoming holiday season, may see growth of 7 percent to 8 percent over 2010 levels.

September proved to be a very promising month for luxury retailers. Unlike during the recession, shoppers have returned to shopping with a vengeance in upscale department stores. For example, high-end retailers Saks and Nordstrom reported September same-store sales that were well ahead of estimates. Nordstrom reported a 10.7-percent rise when 5.2 percent was expected, and Saks posted a 9.3-percent rise when 6.5 percent was projected. Cosmetics were cited by Saks as one of its strongest-performing categories.


Direct sales brands are seeing a 2011 slightly improved from 2010. Kline estimates the direct trade class as a whole in the United States will show modest growth of 2 percent to 3 percent in 2011, over prior year sales.

Looking at one example, globally, Avon is not having a very good year so far. Financial results from the first half of 2011 show company wide, constant-dollar growth is 2 percent in the second quarter of 2011. However, the U.S. picture is less rosy for Avon. Second-quarter 2011 revenue in North America was 7 percent lower year over year. Active representatives declined by 8 percent, and units sold declined 16 percent compared with a year ago. Other direct sales brands are doing better.


Specialty brands, for several years a driving force in the market, suffered a bit in the recession, and some brands haven’t bounced back much since. Specialty brands are estimated to grow between about 4 percent and 5 percent in 2011. Note the specialty trade class includes vertically integrated store brands like L’Occitane, and excludes multi-brand specialty stores like Sephora (each brand sold in Sephora is accounted for in its predominant trade class).

Some specialty brands are doing poorly in 2011, while one shining exception is Bath & Body Works, which reported same-store sales increased 8 percent for year-to-date 2011, as of September. Gains of 12 percent in the month of September in same-store sales are partly attributed to high selling anti-bacterial products.


Professional brands are expected to grow about 1 percent to 2 percent in 2011. Professional skin care brands should hold their own from 2010, while salon hair care brands are expected to pull down the average somewhat.

Obagi, a leader in professional skin care, reported sales growth of 1.5 percent in the first half of 2011, as compared to the first half of 2010. As mentioned above, other professional skin care brands are expected to be performing slightly better than that, while salon hair care brands are more in the low positive growth range.

Category performance

Looking at skin care, the largest product class in the whole cosmetics and toiletries market, the prestige brands, are also performing well here. The skin care market as a whole is estimated to increase between 3 percent and 4 percent in 2011. Nail polishes are continuing to soar in the makeup product class, with continued high double-digit increases. Fragrances may grow an unusually high 4 percent to 5 percent for the year. The holiday season remains a big unknown and will have a large impact on the overall market performance, particularly for giftable categories like fragrances.

Consumer confidence, as tracked by Conference Board, showed a steep decline in August this year, with further deterioration in October. The Index for October was at 39.8 (1985=100), down from 46.4 in September. Withering consumer confidence points to a second half of 2011 faring somewhat less well than the first half.

In conclusion, the year of 2011 is shaping up to be an interesting anomaly of robust and feebly performing segments. Opportunities are shifting again in this ever-evolving industry.


/**/ var loc = window.location.pathname;var nt=String(Math.random()).substr(2,10);document.write ('');

Latest Articles

//window.disqus_no_style = true; (function() { var SHORTNAME = 'insidecosmeceuticals'; // Your website's shortname on Disqus var dsq = document.createElement('gascript'); dsq.type = 'text/javagascript'; dsq.async = true; dsq.src = '' + SHORTNAME + '/embed.js'; (document.getElementsByTagName('head')[0] || document.getElementsByTagName('body')[0]).appendChild(dsq); })();
//= 0) { query += 'url' + i + '=' + encodeURIComponent(links[i].href) + '&'; } } document.write(''); })(); //]]> /* var pageTracker = _gat._getTracker("UA-624328-41"); pageTracker._setDomainName("auto"); pageTracker._trackPageview(); /*]]>*/