The predictions come as many question the ability of the luxury markets to hold up under a second economic downturn. But, according to Euromonitor analyst Fflur Roberts, the more affordable nature of a cosmetics product, even a luxury one, will stand the market in good stead in the future.
“Super premium beauty and personal care (an entry level price of around £100) will continue to represent one of the most accessible luxury categories in terms of average price and widespread consumer ability to afford them,” she told CosmeticsDesign-Europe.com.
For Roberts, a luxury purchase in the cosmetics domain is seen more of an investment rather than an indulgence especially when it comes to skin care.
“During times of hardship when consumers may be tightening their purse strings, they may be willing to forgo certain luxury products or opt to trade down to more affordable luxury brands but will be reluctant to give up their skin care and beauty regimes,” she explained.
This is underlined by increasing consumer interest in scientific developments in skin care. According to Roberts, who predicts growth in anti-ageing products and a focus on the science behind DNA repair, consumers will be happy to pay super premium prices for brands with specific functionality if they believe in the results.
Target China but don’t ignore the mature markets
Like other luxury sectors, the BRIC markets have driven growth in super premium beauty products, accounting for 39 per cent of growth over 2005 – 2010.
This will continue over the next twelve months, according to Roberts, with India, Brazil and China individually contributing the biggest percentage growth globally.
In particular she advised companies to target China, which saw 15 per cent value growth in 2009, higher then the 13 per cent for skin care overall. A general mistrust of domestic brands in favour of international, and a perceived link between price and efficiency, will help grow sales in the country, she said.
However, the mature markets such as France, Germany and the UK will also contribute significant growth to the sector, where it will be the baby boomers driving growth, she added.
Fflur Roberts will be giving a presentation on the luxury markets at the upcoming LuxePack trade show in Monaco.