Table of Contents
Overview
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- What you need to know
- Products covered in this Report
Executive Summary
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- The market
- Growth in the beauty market projected to continue
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- Figure 1: Market size and forecast for consumer spending on beauty and personal care products (including VAT), 2013-23
- Robust demand for beauty boosts health and beauty sector
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- Figure 2: Health and beauty specialist retailers sales (including VAT), 2013-23
- Companies and brands
- Boots suffers from its maturity
- AS Watson performing well
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- Figure 3: Leading specialist and non-specialist retailers’ estimated market shares, 2017
- Grocers losing market share
- Boots and Superdrug most trusted retailers
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- Figure 4: Attitudes towards and usage of selected brands, December 2018
- The consumer
- Changes in beauty purchasing habits
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- Figure 5: Beauty and personal care items purchased in the last 12 months, November 2018
- An ongoing preference for mass-market brands
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- Figure 6: Beauty and personal care brand types purchased in the last 12 months, November 2018
- Supermarkets continue to draw in consumers
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- Figure 7: Where they purchased beauty and personal care items in the last 12 months, November 2018
- Most shop online because it is easier to browse
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- Figure 8: Why they shop online for beauty and personal care, November 2018
- A lack of experience hinders the online market
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- Figure 9: Why they don’t shop online for beauty and personal care, November 2018
- Mass-market brands need to innovate
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- Figure 10: Beauty and personal care correspondence analysis, November 2018
- Price comparison habits will threaten margins
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- Figure 11: Beauty and personal care purchasing behaviours, November 2018
- What we think
Issues and Insights
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- Price wars: the next steps to ease the downward pressure
- The facts
- The implications
- Sustainability: more informed consumers will demand more from BPC retailers
- The facts
- The implications
- The shift online: how multichannel retailers can fight back
- The facts
- The implications
The Market – What You Need To Know
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- Spending on BPC continues to rise
- Beauty fuelling market growth
- Specialists outperform the wider market
- Online penetration increases
- Uncertainty hits consumer confidence
Market Size and Forecast
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- UK beauty and personal spending up 1.4% in 2018
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- Figure 12: Market size and forecast for consumer spending on beauty and personal care products (including VAT), 2013-23
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- Figure 13: Market size and forecast for consumer spending on beauty and personal care products (including VAT), at current and constant prices, 2013-23
- What might Brexit mean for the UK BPC market?
- Forecast methodology
Market Segmentation
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- Growth in beauty spending remains robust during 2018
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- Figure 14: Market size and forecast for consumer spending on beauty products (including VAT), 2013-23
- Figure 15: Market size and forecast for consumer spending on beauty products (including VAT), at current and constant prices, 2013-23
- Beauty category performance
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- Figure 16: Consumer spending on beauty products (including VAT), by category, 2014-18
- Colour cosmetics
- Fragrances
- Facial skincare
- Hand, body and footcare
- Spending on personal care thought to have fallen in 2018
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- Figure 17: Market size and forecast for consumer spending on personal care products (including VAT), 2013-23
- Figure 18: Market size and forecast for consumer spending on personal care products (including VAT), at current and constant prices, 2013-23
- Personal care category performance
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- Figure 19: Consumer spending on personal care products (including VAT), by category, 2014-18
- Haircare
- Oral hygiene
- Soap, bath and shower
- Shaving and hair removal
- Deodorants
- Hair colourants
- Suncare
- Forecast methodology
Sector Size and Forecast
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- Health and beauty specialists outperforming
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- Figure 20: Health and beauty specialists’ sales (including VAT), 2013-23
- Figure 21: Health and beauty specialists’ sales (including VAT), at current and constant prices, 2013-23
- Notes on Mintel’s sector size
- Outlet and enterprise numbers
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- Figure 22: Health and beauty specialists’ outlet numbers, 2014-18
- Figure 23: Health and beauty specialists’ enterprise numbers, 2014-18
- Forecast methodology
Online
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- Online spending rises 6% in 2018
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- Figure 24: Estimated market size and forecast for online consumer spending on beauty and personal care products, 2013-23
- Figure 25: Estimated market size and forecast for online consumer spending on beauty and personal care products, at current and constant prices, 2013-23
- Online channels of distribution
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- Figure 26: Estimated distribution of online spending on beauty and personal care products, 2016-18
- Forecast methodology
Channels to Market
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- Grocers continue to lose market share
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- Figure 27: Estimated distribution of spending on beauty and personal care products, 2018
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- Figure 28: Estimated distribution of spending on beauty and personal care products (including VAT), 2016-18
Market Drivers
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- BPC inflation remains low
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- Figure 29: Consumer price inflation, 2007-17
- Prices of BPC products continue to fall
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- Figure 30: Consumer price inflation, October 2017-August 2018
- Real wages return to growth in 2018
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- Figure 31: Real wage growth – Average weekly earnings vs inflation, January 2014-October 2018
- Consumer confidence hit by Brexit
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- Figure 32: Consumer financial confidence, January 2016-November 2018
- An ageing population is an opportunity for BPC retailers
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- Figure 33: Trends in the age structure of the UK population, 2016-26
- Figure 34: Breakdown of trends in the age structure of the UK population, 2016-26
- Fewer people saving, more going out
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- Figure 35: Trends in what extra money is spent on, November 2017 and November 2018
- Gifting remains important
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- Figure 36: Beauty and personal care items bought as a gift in the last 12 months, November 2018
- Stores are a primary source of information
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- Figure 37: Sources of beauty and personal care information, November 2018
- Demand for personalisation
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- Figure 38: Interest in beauty and grooming personalisation services, November 2018
Companies and Brands – What You Need to Know
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- Boots struggles in the face of intense competition
- AS Watson’s performance bolstered by Savers
- Grocery multiples continue to hold a dominant position
- Lush and The Body Shop benefit from ethical associations
- Total beauty advertising spend down 7.2%
Leading Specialists
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- Savers boosts AS Watson growth this year
- Boots regarded as less innovative
- Leading specialists by sales
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- Figure 39: Leading specialist retailers’ net revenues (excluding VAT), 2013-17
- Online beauty retailers
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- Figure 40: Leading online/home shopping specialist retailers’ net revenues (excluding VAT), 2013-17
- Leading pharmacies by sales
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- Figure 41: Leading pharmacy chains’ net revenues (excluding VAT), 2013-17
- Outlet numbers and sales per outlet
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- Figure 42: Leading specialist retailers’ outlet numbers, 2013-17
- Figure 43: Leading specialists retailers’ estimated sales per outlet, 2013-17
- Operating profits and margins
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- Figure 44: Leading specialist retailers’ operating profits, 2013-17
- Figure 45: Leading specialist online/home shopping retailers’ operating profits, 2013-17
- Figure 46: Leading specialist retailers’ operating margins, 2013-17
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- Figure 47: Leading specialist online/home shopping retailers’ operating margins, 2013-17
Leading Non-specialists
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- Beauty is becoming a mainstream focus for the grocery multiples
- Department stores a mixed performance
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- Figure 48: Leading non-specialist retailers’ estimated sales growth, by segment, 2017
- Aldi and Lidl continue to strengthen position
- Amazon’s beauty disruption begins
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- Figure 49: Leading non-specialist retailers’ estimated beauty and personal care goods sales (excluding VAT), 2015-17
Market Shares
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- Market remains fragmented
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- Figure 50: Leading specialist and non-specialist retailers’ estimated market shares, 2017
- Figure 51: Leading specialist and non-specialist retailers’ estimated market shares, 2015-17
- Note on market shares
Launch Activity and Innovation
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- YSL launches beauty pop-up at Heathrow
- Space NK launches Drunk Elephant in the UK
- Primark’s ‘PS’ cruelty-free beauty products
- Debenhams redesigns its beauty department in Watford
- Wow How has released a new virtual beauty try-on app
- Avon gets personal
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- Figure 52: Avon’s subscription service, Letterbox Loves, June 2018
- L’Oréal purchases AI Beauty Company
- Coty x Amazon Echo
- On-demand bespoke lipstick
- Boy de Chanel
- Unilever launches 'natural' shampoos and soaps to attract Millennials
- Packaging-free foundation
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- Figure 53: Lush’s Slap Stick packaging-free foundation, June 2018
- L’Oréal investing in Natural cosmetics
Advertising and Marketing Activity
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- Total beauty advertising spend down 7.2%
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- Figure 54: Recorded above-the-line advertising expenditure on beauty and personal care, total market, 2013-17
- Figure 55: Recorded above-the-line, online, display and direct mail total advertising expenditure on beauty and personal care, by leading retailers, 2015-18
- Key campaigns
- Boots celebrates mothers with ‘She’s me mum’ seasonal campaign
- L’Occitane takes a new marketing approach
- Digital overtakes press in advertising spend
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- Figure 56: Recorded above-the-line advertising expenditure percentage on beauty and personal care, by media type, total market, 2017
- Nielsen Ad Intel coverage
Brand Research
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- What you need to know
- Brand map
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- Figure 57: Attitudes towards and usage of selected brands, December 2018
- Key brand metrics
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- Figure 58: Key metrics for selected brands, December 2018
- Brand attitudes: Lush seen as worth paying more for
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- Figure 59: Attitudes, by brand, December 2018
- Brand personality: L’Occitane viewed as the most exclusive
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- Figure 60: Brand personality – Macro image, December 2018
- Boots perceived as being welcoming and reliable
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- Figure 61: Brand personality – Micro image, December 2018
- Brand analysis
- Boots is the most trusted retailer
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- Figure 62: User profile of Boots, December 2018
- Superdrug perceived as offering good value
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- Figure 63: User profile of Superdrug, December 2018
- Lush viewed as being innovative
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- Figure 64: User profile of Lush, December 2018
- The Body Shop perceived as having great customer service
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- Figure 65: User profile of The Body Shop, December 2018
- L’Occitane has a strong brand DNA
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- Figure 66: User profile of L’Occitane, December 2018
- Kiko Milano viewed as fun
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- Figure 67: User profile of Kiko Milano, December 2018
- Space NK has excellent customer experience
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- Figure 68: User profile of Space NK, December 2018
Space Allocation Summary
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- Figure 69: Leading health and beauty retailers: health and beauty products estimated space allocation, January 2019
- Superdrug trialling Botox and cosmetic procedures in-store
- The Body Shop deploying personalisation services in stores
- Department stores new beauty hall concepts to attract shoppers
- Supermarkets in-store beauty makeover
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- Figure 70: Leading health and beauty retailers: Health and beauty products estimated detailed space allocation, January 2019
- Figure 71: Leading health and beauty retailers: Health and beauty products estimated detailed space allocation, January 2019
- Health and beauty space as a percentage of total floor space in non-specialists
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- Figure 72: Non-specialists: estimated health and beauty space as a percentage of total floor space, January 2019
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AS Watson
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- What we think
- Diverse collection of businesses
- Recent focus on service and online
- Marionnaud a poor fit for AS Watson structure
- Where next?
- Company background
- Company performance
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- Figure 73: AS Watson (Europe): group financial performance, 2013-17
- Figure 74: AS Watson (Europe): outlet data, 2013-17
- Retail offering
- Rossmann
- Kruidvat and Superdrug
- Savers and Prijsmepper
- Other businesses
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- Figure 75: AS Watson Europe, operating companies, 2017
The Body Shop
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- What we think
- New owner reinforces values
- New brand ambassadors could personalise ethical and green appeal
- Missing out on new product benefits
- Continued investment needed in physical retail
- Broadening appeal to older consumers
- Company background
- Company performance
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- Figure 76: The Body Shop: group financial performance, 2013-17
- Figure 77: The Body Shop: estimated UK sales performance, 2013-17
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- Figure 78: The Body Shop: outlet data, 2013-17
- Retail offering
- Product mix
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- Figure 79: The Body Shop: sales, by category, 2017
Debenhams
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- What we think
- New beauty hall design to attract shoppers
- Strengthening beauty offering, partnering with Estée Lauder to launch #Beautyhub
- Rewarding socially-engaged beauty consumers with discounts
- Exploring different beauty product category opportunities
- Company background
- Company performance
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- Figure 80: Debenhams: group financial performance, 2013/14-2017/18
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- Figure 81: Debenhams: outlet data, 2013/14-2017/18
- Retail offering
House of Fraser
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- What we think
- Ambitious plan to transform House of Fraser into Harrods of the High Street
- Strained supplier relations
- Nationwide shopping event
- Company background
- Company performance
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- Figure 82: House of Fraser Plc: group financial performance, 2013/14-2017/18
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- Figure 83: House of Fraser Plc: outlet data, 2013/14-2017/18
- Retail offering
The Fragrance Shop
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- What we think
- Buy now, pay later payment scheme
- 'Sniff Bar' pop-up’s
- Black Friday sales push
- Company background
- Company performance
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- Figure 84: The Fragrance Shop: group financial performance, 2013/14-2017/18
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- Figure 85: The Fragrance Shop: outlet data, 2013/14-2017/18
- Retail offering
John Lewis
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- What we think
- New concierge-style beauty service concept
- Capitalising on vegan beauty trend
- Preparing to launch a personalised Beauty reward programme
- Expanded click-and-collect options
- Company background
- Company performance
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- Figure 86: John Lewis Plc (department store): group financial performance, 2013/14-2017/18
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- Figure 87: John Lewis Plc (department store): outlet data, 2013/14-2017/18
- Retail offering
Kiko Milano
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- What we think
- Hits the buffers in key markets including US, UK and Germany
- Injection of capital will allow it to retarget its expansion
- Online offers wide international coverage but some stores will be necessary
- Company background
- Company performance
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- Figure 88: Kiko Milano: group financial performance, 2013-17
- Figure 89: Kiko Milano: outlet data, 2013-17
- Retail offering
Lush Retail Ltd
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- What we think
- Lush responds to consumer demand with its ‘Community Products’
- Lush goes packaging-free
- Lush enables customers to make their own bath bombs
- Wales’ first Lush Spa Shop opens in Cardiff
- Company background
- Company performance
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- Figure 90: Lush Retail Ltd: group financial performance, 2013/14-2017/18
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- Figure 91: Lush Retail Ltd: outlet data, 2013/14-2017/18
- Retail offering
Walgreens Boots Alliance
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- What we think
- Few tangible signs of merger benefits
- UK and European markets too mature to be the strategic focus
- Online under pressure from all sides
- Company background
- Company performance
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- Figure 92: Walgreens Boots Alliance (UK and Europe): group sales performance, 2013/14-2017/18
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- Figure 93: Walgreens Boots Alliance (UK and Europe): outlet data, 2013/14-2017/18
- Retail offering
The Consumer – What You Need To Know
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- Fewer people shopping for beauty
- Value brands popular when buying toiletries
- An uplift in online purchasing
- Convenience and price drive shoppers online…
- …but experience also keeps people buying in-store
- Mass-market brands seen as good value
- Savvy shoppers price compare
What They Buy
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- Purchasing levels remain high
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- Figure 94: Beauty and personal care items purchased in the last 12 months, November 2018
- A dip in the number of consumers buying beauty products
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- Figure 95: Beauty products purchased in the last 12 months, by age and gender, October 2017 and November 2018
- Signals that consumers are using fewer products
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- Figure 96: Repertoire of beauty and personal care items purchased in the last 12 months, October 2017 and November 2018
Brand Types Purchased
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- Fragrances remain most purchased prestige products
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- Figure 97: Beauty and personal care brand types purchased in the last 12 months, November 2018
How and Where They Shop
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- More consumers are shopping online
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- Figure 98: How they purchased beauty and personal care items in the last 12 months, November 2018
- Supermarkets remain dominant
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- Figure 99: Where they purchased beauty and personal care items in the last 12 months, November 2018
- Boots is the most used retailer
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- Figure 100: Where they purchased beauty and personal care items in the last 12 months, November 2018
- Online-only players strengthen their position
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- Figure 101: Where they purchased beauty and personal care items in the last 12 months, October 2017 and November 2018
- Discounters appeal to older consumers
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- Figure 102: Where they purchased beauty and personal care items in the last 12 months, by age and income, November 2018
- Make-up purchasing moving online
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- Figure 103: Beauty and personal care items purchased in the last 12 months, by how they shopped, November 2018
- Most only shop with one or two different retailers
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- Figure 104: Repertoire of where they purchased beauty and personal care items in the last 12 months, November 2018
Reasons for Shopping Online
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- Consumers think prices online are cheaper
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- Figure 105: Why they shop online for beauty and personal care, November 2018
Reasons for Not Shopping Online
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- Enjoyment keeps people shopping in-store
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- Figure 106: Why they don’t shop online for beauty and personal care, November 2018
Brand Perceptions
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- Methodology
- Prestige brands are considered to be overrated
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- Figure 107: Beauty and personal care correspondence analysis, November 2018
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- Figure 108: Beauty and personal care correspondence analysis, November 2018
Purchasing Behaviour
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- Natural ingredients remain popular
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- Figure 109: Beauty and personal care purchasing behaviours, November 2018
- Women more interested in sustainability
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- Figure 110: Beauty and personal care purchasing behaviours – Agreement with statements about sustainability, by gender, November 2018
- Older consumers show more brand loyalty
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- Figure 111: Beauty and personal care purchasing behaviours – Agreement with statements about loyalty, by age and gender, November 2018
- Young consumers need more guidance
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- Figure 112: Beauty and personal care purchasing behaviours – Agreement with statements about product discovery and preferences, by age, November 2018
Appendix – Data Sources, Abbreviations and Supporting Information
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- Abbreviations
- Consumer research methodology
Appendix – Market Size and Forecast
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- Forecast methodology
- Best- and worst-case forecasts
- Market size
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- Figure 113: Market size and forecast for consumer spending on beauty and personal care products (including VAT), best- and worst-case forecast, 2018-23
- Sector size
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- Figure 114: Health and beauty specialists’ sales (including VAT), best- and worst-case forecast, 2018-23
- Online market size
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- Figure 115: Estimated market size and forecast for online consumer spending on beauty and personal care products, best- and worst-case forecast, 2018-23
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