The hair care market is weathering the global recession but as Emma Reinhold reports, brands need to be mindful of consumer spending habits and adapt accordingly
Twelve months can make a big difference in any consumer market and the fears many C&T markets had this time last year seem to have been abated to some extent, none more so than in hair care.
According to Euromonitor International the global hair care market reached €44bn in 2008, a 3.6% increase on the previous year’s sales. However despite positive growth in an increasingly difficult economic climate, the hair care market saw the lowest growth rate in the C&T sector after premium cosmetics, which grew just 2%.
Western Europe kept its crown as the biggest hair care region, according to the analyst, accounting for over a quarter of total global sales in 2008. Germany alone accounts for higher hair care value sales than the Middle East and Africa combined ($2.7bn), while across the Atlantic, the US is still the single largest market for hair care with value sales of over $10bn in 2008, a 16% share of the global hair care market. And Americans continue to be the biggest consumers of salon hair care, with an annual spend of $2bn in 2008.
There is also promising growth from developing markets such as China, where “people are now washing their hair more often, which has translated into stronger sales growth for shampoo and conditioners,” according to Euromonitor’s personal care industry analyst, Carrie Lennard.
India too has seen a surge in hair care usage. “A rise in disposable income has resulted in consumers shifting away from buying a single bottle of shampoo or conditioner for the whole family and embracing the segmentation trend by buying individual products tailored to gender, age or hair type,” explains Lennard. “However price is still a barrier to buying hair care products for many people and manufacturers have tried to overcome this by selling sachets and smaller bottles that are more affordable.”
CREDIT CRUNCH OPPORTUNITIES
Undoubtedly the global recession has affected sales of all consumer goods over the last 18 months, and despite being regarded as a commodity market, hair care sales have not come out unscathed.
A report by Mintel shows that in response to the recession, a quarter of female shampoo users in the UK have spent less on shampoo, contributing to a £15m slide in the value of the market between 2008 and 2009. The analyst also predicts the conditioner market in the UK, which has dropped £8m in the last year, will see a decline well into 2010 as UK consumers continue to economise.
“The UK market for shampoos and conditioner is witnessing a downward trend and hair treatments such as conditioner are the most likely to be cut from the hair care regime in the current climate,” explains Alexandra Richmond, senior beauty analyst at Mintel. “Advertising budgets have been cut and heavy price promotions at the point of sale are wooing consumers, a growing number of which are watching the pennies.
“Many consumers who in positive economic times purchased salon shampoo brands have traded down to cheaper brands and private label products,” adds Lennard.
Some brands are reacting to this with budget ranges and value sized products in an attempt to appeal to the estimated 3.5 million women Mintel identified as buying value sized hair care products in the three months to February 2009.
Supermarket Tesco for instance has introduced HBM, a new budget hair care range claimed to be developed by professionals and offering salon quality formulations. The six sku line includes shampoos and conditioners for dry, coloured and environmentally stressed hair types, each housed in one litre bottles.
Another effect of the economic downturn has been the drop in frequency of salon trips by consumers.
“From October 2008 to June 2009 we have seen a clear drop in visit frequency,” explains Vincenzo Minore, general manager, Aveda UK and Ireland. “Clients are leaving a longer space between visits.”
“Clients are using hairdressers less frequently as far as colouring, styling and cutting are concerned,” adds hairdresser Philip Kingsley. “Although visits may be less, consumer care for their overall hair condition and appearance seems to have risen, and use of products to attain this has increased too.”
One outcome of this has been the growth in the home colourants market, one of the few areas in the hair care market to receive a boost from the recession.
“In countries like the UK and US, many women previously thought nothing of paying £100 to have their hair coloured by a hairdresser. But as consumers begin to re-evaluate their spending habits, supermarkets in the UK have reported a big rise in the number of home colourants being sold,” explains Lennard.
Clairol has responded to this demand by launching Perfect 10 by nice’n easy. The home hair colourant system is said to offer high gloss colour and improved hair condition in just ten minutes thanks to new aminoglycine technology, which helps create faster, truer hair colours whilst reducing surface damage to the hair.
And Garnier has created Herbashine, a new ammonia-free colourant system infused with bamboo extract that is said to provide high shine hair colour in just ten minutes.
COLOUR GETS CREATIVE
Alongside home colourants there has been increased activity in products developed for coloured hair. New technologies have enabled greater segmentation in this area with products now boasting colour intensity and even hair lightening properties.
John Frieda’s new Sheer Blonde Go Blonder line claims to be the first shampoo and conditioner to market that gradually lightens and brightens blonde hair. The formula contains a Lightening Complex derived from citrus and chamomile, which helps to create a sun-kissed blonde colour.
“It seems blondes always want to be that little bit blonder but still retain a natural look,” explains John Frieda’s creative colour director, Nicola Clarke. “Go blonder products help achieve a gradual sparkly blonde, something that you’ve never been able to achieve from a shampoo or conditioning product before.”
Similarly Mark Hill’s Lighter Brighter Blonde range promises to brighten and gently lighten natural, coloured and highlighted blonde hair thanks to a blend of lemon and chamomile extracts, while the new Refresh Your Blonde line helps to refresh blonde shades and neutralise brassy yellow tones.
And targeting highlights, L’Oréal Paris’ Elvive Nourish and Shimmer range is claimed to brighten highlights by up to two times whilst nourishing and softening hair. The formula contains moisturising royal jelly and light reflecting minerals said to enhance highlight brightness and shine.
Toni&Guy meanwhile has launched a new range of shade specific hair care and styling products, said to intensify the tone of coloured hair. Key to the formula of the Toni&Guy Colour products is Level One Dye Complex, which works by penetrating the hair cuticle and leaving a subtle infusion of semi-permanent pigment. With use the colour intensity increases, according to the brand. The collection includes products for brunette and blonde hair tones.
Taking colour enhancement to a new level, and tapping into the spending potential of the baby boomer generation, Philip Kingsley has developed Pure Silver, a new shampoo and conditioner created for grey hair. Designed to brighten grey hair, neutralise yellow tones and soften the wiriness often associated with hair that has lost its pigment, the products contains violet hues and optical brighteners to add shine, and hydrolysed wheat protein to strengthen the hair.
“More and more hair care manufacturers have begun to realise the potential spending power of the baby boomer generation and are launching products specifically designed to appeal to this lucrative consumer segment,” says Lennard.
PRESCRIPTIVE SOLUTIONS
Segmentation in the hair care sector has certainly helped encourage new consumers to invest in hair care products in recent years, and in the current economic climate targeted hair care solutions are proving more popular than ever as consumers look for added value in their purchases.
“Everyone is looking for added value in this market so specific products are helping with this,” says Minore. “We are seeing a much more prescriptive approach to hair care with targeted hair care products that are much more specific to client needs.”
One area that is seeing increased product development is the problems associated with a sensitive scalp. Pharmacy hair care brand Phyto is to launch Phytopaisant Soothing Treatment Shampoo and Re-Balancing Treatment Spray, created to treat sensitive scalps. The high tolerance formulas contain purslane extract, which helps to soothe and calm itching and prickling associated with sensitive scalps.
La Biosthetique, meanwhile, has launched a scalp check kit to help consumers assess the condition and health of their scalps. The kit contains indicators, which measure pH and sebum levels as well as detecting dandruff. The results enable the consumer to choose the appropriate hair care treatment.
Treatments for thinning hair and hair loss have also emerged as an NPD hotspot over the last year, with particular activity in the UK. Minore tells SPC that hair regain products are already a well established sector in mainland Europe but are booming in the UK as they are a relatively new market for consumers there.
New launches include Joico’s Clinicure Thinning Hair Solutions line comprising Purifying Scalp Cleanse, Balancing Scalp Nourish and Stimulating Scalp Treatment. Meanwhile Nanogen’s hair loss treatment range includes Nanoguard A treatment shampoo and a scalp roller featuring titanium needles said to optimise the effects of topical treatments.
The claims made on these types of products are not always supported with proper scientific evidence and is an area many in the industry want to see have greater transparency.
“I would like to see more attention given to the spurious claims that manufacturers make for the products,” says Kingsley. “However there is little doubt that there will be products of this type with a more scientific approach and clinical expertise.”
At the other end of the scale, Kérastase has launched Oléo-Slim, its first volume reduction range for thick, unmanageable hair. Cera-Trioleum technology helps to tame, soften and de-frizz hair. Products include a night mask and blow dry cream.
And L’Oréal Paris has launched Full Restore 5, a new line developed specifically to address the top five hair problems of UK women. The products, which are enriched with pro-keratin and ceramides, are said to condition and smooth each hair fibre leaving hair silky, fuller, stronger and shinier. The line includes a shampoo, conditioner, hair mask and night serum and the campaign is fronted by singer and woman of the moment Cheryl Cole.
Male hair loss is also increasingly being addressed. Grooming brand American Crew has targeted hair thinning with the launch of Trichology Hair Recovery System, a four-sku salon line that promises to provide thicker, fuller, stronger hair, while Phyto plans to launch a targeted men’s hair loss treatment and shampoo called Phytolium early next year.
Despite a greater focus on male specific hair care it remains one of the few areas where segmentation has struggled to boost sales, according to Euromonitor, with the exception of styling products.
“Barriers to growth include the fact that men are still largely secondary consumers and marketers have struggled to convince men to switch from standard hair care products,” says Lennard.
However she cites the recent launch of the L’Oréal Professional Homme range as an example of a change in direction. Cult styling range Brylcreem, recently acquired by Unilever as part of Sara Lee, was recently relaunched in a bid to lure more male consumers.
NATURAL AGENDA
Despite the current consumer move towards trading down in some hair care areas, sales of natural hair care products still appear to be thriving, though this remains a very niche area.
“Although value sales of natural products are negligible compared to global heavyweight brands, early indications are that they are proving to be better placed to weather the storm of recession than standard premium priced hair care products,” explains Lennard. “Consumers who buy natural products generally want to avoid the use of certain ingredients such as SLS or parabens. Because they perceive a tangible benefit in buying these products, they are less likely to trade down to cheaper brands or private label products.”
La Biosthetique extended its Natural Cosmetic range to include a ten-sku Ecocert certified natural hair care and styling line. The luxury line is said to be free of silicones, parabens and paraffin oils and comprises products from almost 100% natural sources.
Naked, recently purchased by KMI, has also launched natural hair care and styling lines. The products are said to be 97% natural and include shampoos, conditioners, treatments, serums and mousses.
And Andrew Collinge’s new Purity range includes organic quinoa protein, botanicals and aromatherapy oils, which help strengthen and soften hair.
Innovation and an ability to adapt to the economic crisis have certainly helped buoy the hair care market over the last 12 months, but as consumers continue to cut their spending habits, non-essential hair care items will no doubt continue to suffer. Finding a way to encourage consumers to see the value in these products will be key in the coming months.