Every month various beauty industry analysts from The NPD Group write about the latest trends being seen in beauty, based on the firm’s market information and insights. Through a partnership, Beauty News will publish NPD’s blog the day it’s posted to keep you in the know. May’s post is by NPD’s Jen Famiano and focuses on which category consumers are most interested in today, how the percentage of units sold on promotion can act as a future indicator of health across the beauty industry, and about beauty’s changing of the guard.
As the years go by, one thing has always been constant: beauty is a fickle industry. The market runs on innovation, but there comes a time when innovation dries up.
A few years ago, this happened to the makeup category. The incredible success of reality TV queens (think the Kardashians here), spawned new products such as highlighters and contouring, and fresh techniques that consumers needed additional products to duplicate. But soon that trend slowed and ultimately dried up, leaving room for the skin care category to take the reins — with “clean beauty” leading the charge.
Fast forward to today: in the first quarter of 2022, sales revenue in the U.S. skincare category grew at half the rate of makeup, signifying a changing of the guard. Makeup has now returned to the spotlight and, since it is in demand with consumers, promotions on makeup products fell year over year in the first quarter of 2022. As a recap, within the makeup category lip makeup product revenue grew at the fastest rate, followed by face and eye makeup. Lipstick sales were up 44 percent in the first quarter of 2022 versus last year. Sales of blush and bronzer grew by 45 percent and 38 percent, respectively. Suggesting an increase in makeup usage, makeup remover sales increased by over 30 percent for the quarter.
While the number of promoted makeup products remained steady, the average promoted discount declined. Even more impressive is that sales of non-promoted products are increasing. That tells us consumer demand for makeup is high, so retailers do not need to incentivize purchases.
On the other hand, the skincare category is experiencing growing pains. Lower-priced, ingredient-first brands have changed the consumer—and the business. Consumer excitement about multi-step self-care routines has shifted. TikTok makeup trends are now in favor, including under-blushing and lip contouring. Facial products are leading skin care category sales, and the percentage of units sold on promotion increased in the first quarter, which is in line with 2019, the year COVID-19 essentially closed retail. Among the core skin care segments, sun care is the only one that has experienced a decline in the number of promoted units sold, and it is one of the strongest sales performers so far this year. In the first quarter, sales of sun care grew 60 percent.
Promotions are a necessity in the business. But what we are learning is that the depth of the discount and the percentage of units sold on promotion can act as a future indicator of health across the beauty industry.