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CONTENTS
JANUARY 2017 | VOLUME 185, NUMBER 1
26 FEATURES 14 A Better You: Wellness 2017
Consumers are increasingly focused on their mind, body and spirit, and brands are innovating to help them holistically feel and look their best. BY JEB GLEASON-ALLURED
26 Sustainability Is Driving Consumer Purchases
As brands vie for sustainability leadership, consumers’ expectations are growing. BY IMOGEN MATTHEWS
30 Beauty Is Where the Heart Is
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How social philanthropy drives consumers’ decisions. BY DENISE HERICH
34 So, You Want to Build Your Own Beauty Brand
Five questions to ask before you get started. BY LISA KOVNER
38 Survey: How Millennials Purchase Makeup in the Digital Age
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The power of influencers, the enduring appeal of brick-andmortar shopping and the importance of tutorials. BY KRISTA MCAULAY
DEPARTMENTS 4 Spark: Get Well Soon BY JEB GLEASON-ALLURED
6 Markets & Trends 42 Skin/Sun/Anti-aging
Ingredients and Claims, Packaging and Products
34 www.GCImagazine.com
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46 Hair
Ingredients and Claims, Packaging and Products
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CONTENTS EDITORIAL Director Editor in Chief Research Analyst Assistant Editors
Digital/Social Media Editor
Jo-El M. Grossman Jeb Gleason-Allured | 1-630-344-6069/jallured@allured.com Nicole Urbanowicz | 1-630-344-6053/nurbanowicz@allured.com Jennifer Novoseletsky | 1-630-344-6045/jnovoseletsky@allured.com Savannah Saunders | ssaunders@allured.com Brooke Schleehauf | 1-630-344-6032/bschleehauf@allured.com Lisa Schryver | 1-630-344-6068/lschryver@allured.com Audrey Latimer | 1-630-344-6067/alatimer@allured.com
ADVERTISING SALES Business Development Manager Kim Jednachowski | 1-630-344-6054/kjednachowski@allured.com Business Development Manager Paige Crist | 1-630-344-6060/pcrist@allured.com Fragrance Coordinator Kasia Smialkowski | 1-630-344-6025/ksmialkowski@allured.com
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AUDIENCE DEVELOPMENT
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Director Linda Schmitt Marketing Specialist Marie Galvan Marketing Assistant Alyssa Howard Customer Service 1-888-399-0899/customerservice@gcimagazine.com
DESIGN Graphic Design Manager Senior Graphic Designer Production Manager
Lisa Hede Hon Bannapradist Bryan Crowe
CORPORATE Partner & President Partner & CEO Controller Group Show Director Digital Products Director Executive Assistant
Janet Ludwig George Fox Linda Getner Sandy Chapin Rose Southard Maria Romero
OTHER ALLURED PRODUCTS
DEPARTMENTS 48 Cosmetics Ingredients and Claims, Packaging and Products
51 Bath/Body/Fragrance/Grooming Ingredients and Claims, Packaging and Products
RESOURCES 54 Products & Services Showcase 56 Advertiser Index
Allured Business Media 1-630-653-2155 • fax 1-630-653-2192 336 Gundersen Drive, Suite A Carol Stream, IL 60188-2403 USA www.Allured.com
Alluredbooks Cosmetics & Toiletries Bench Reference Cosmetics & Toiletries magazine Cosmetics & Toiletries magazine: Portuguese edition Cosmetics & Toiletries Summit Skin Inc. magazine Face & Body Midwest Spa Conference and Expo Face & Body Northern California Spa Conference and Expo Face & Body Southeast Spa Conference and Expo Perfumer & Flavorist magazine World Perfumery Congress Flavorcon
Subscriptions: Subscribe online: www.GCImagazine.com/subscribe In the US, telephone: 1-888-399-0899, Outside the US, telephone: 1-847-559-7557 (9 AM–5 PM Central, Mon-Fri) | Fax: 1-847-291-4816 E-mail: customerservice@gcimagazine.com Print subscriptions: Available free to qualified individuals located in the United States. All other countries may subscribe to the digital edition. Periodicals Postage paid at Carol Stream, Illinois, and additional mailing offices. Change of address: Give both the new and old addresses. Allow two months for a change to become effective. Global Cosmetic Industry (ISSN 1523-9470) is published eleven times per year as Jan., Feb., March, April, May, June, July/ Aug., Sept., Oct., Nov. and Dec. issues by Allured Business Media, 336 Gundersen Drive, Suite A, Carol Stream IL 601882403 USA. Copyright 2017. Free subscriptions to Global Cosmetic Industry are available to qualified individuals. The publisher reserves the right to determine qualification of free subscriptions. Replacement issues are available only through single copy sales. Single copies: $20; GCI Directory Issue: $35 (Add $10 per order shipped to Canada; add $15 per order to all other countries.) Periodicals postage paid at Carol Stream IL 60188 and additional mailing offices. POSTMASTER: Please send address changes to Global Cosmetic Industry, PO Box 3009, Northbrook, IL 60065-3009. Change of address: Give both the new and old addresses. Allow two months for a change to become effective.
Members of the American Business Media. All correspondence regarding business, editorial, advertising and production should be sent to Global Cosmetic Industry, 336 Gundersen Drive, Suite A, Carol Stream, IL 60188-2403 USA.
@GCI_Magazine
facebook.com/gcimagazine
Allured Business Media makes all attempts to publish accurate information; however, this publication may contain technical inaccuracies or typographical errors. The reader assumes all risks concerning the suitability and accuracy of the information within this publication. Allured Business Media assumes no responsibility for and disclaims all liability for any such inaccuracies, errors or omissions in this publication and in other documents referred to within or affiliated with this publication. www.GCImagazine.com
2 Contents Global Cosmetic Industry | January 2017
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SPARK
| BY JEB GLEASON-ALLURED
Get Well Soon
D JEB GLEASON-ALLURED Editor in Chief jallured@allured.com @GCI_Magazine
GLOBAL COSMETIC INDUSTRY MAGAZINE EDITORIAL ADVISORY BOARD ALISA MARIE BEYER
Coastal Salt & Soul
MARIE ALICE DIBON
Alice Communications, Inc.
ADA POLLA
Alchimie Forever, The Polla Beauty Group
ART RICH, Ph.D.
A. Rich Development
RICK RUFFOLO
R4 Innovations
CRISTINA SAMUELS
Mode Cosmetics
LAURA SETZFAND Epiphany
eep down, wellness is about renewal—of mind, body and spirt. Which makes it the perfect subject for our January cover story. Wellness represents a $3.7-trillion global market, of which about $1 billion is attributable to beauty and antiaging (Page 14). But, beyond the vast market opportunity, wellness represents a complete disruption of industries as diverse as travel, legal marijuana, tech and, of course, beauty. Not only is wellness introducing new paradigms to individual categories, it’s also forging bridges that span multiple industries, such as personal care and apparel or skin care and beverages, while challenging brands to boost their sustainability and corporate governance activities. In this age of information overload, high anxiety and health consciousness, wellness appears poised to reshape consumers’ lives and, consequently, the brands they rely on. With more than 80% of millennials exercising at least once a week and about 70% taking dietary supplements, it’s clear that the consumers are already on board. Of course, it doesn’t hurt that more than 65% of consumers are willing to pay a little extra for products and services that come from companies with a positive social and environmental impact. But what is wellness, exactly, and how is it impacting consumer attitudes and habits, and brands and retailers? Turn to page 14 to find out. Meanwhile, in the spirit of renewal, Global Cosmetic Industry has continued its ongoing evolution with the reorganization of our product, packaging and ingredient departments, which are now arranged by product segment. So, please browse, read and let us know what you think. We’ll see you next month.
Follow us on Twitter @GCI_Magazine
SUBSCRIBE TO OUR NEWSLETTER Sign up to receive daily news, insights and trends
www.GCImagazine.com/newsletter
4 Spark Global Cosmetic Industry | January 2017
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MARKETS & TRENDS Why Silicon Valley Loves Beauty
BEAUTY CONSUMERS BY THE NUMBERS* • 66%/61%: percentage of women and men, respectively, who believe that beauty is necessary for a successful life (Canadean)
• 453 billion: number of occasions when men used skin care in 2011(Canadean)
• 557 billion: number of occasions when men used skin care in 2015 (Canadean)
• 65%: portion of millennials that have purchased makeup on their smart phone (Poshly, Perfect365)
• 30 million: number of selfies taken every day (YouCam) • 40%: portion of selfie takers who spend at least five minutes
IVP knows a disruptor when it sees one, and has dropped some serious money their way: Dropbox, Netflix, Snap, Twitter and The Honest Company. Now, add Glossier to that list. But why? According to a post by Glossier founder and CEO Emily Weiss, the $24 million in Series B funds will help the company to boost its technology, expand globally, launch products in new categories and open its first retail space. The retail expansion in particular is in line with the strategies of other “cult” brands such as NYX that are looking to engage consumers with enhanced shopping experiences that boost their omnichannel strategy, while also offering brand building and awareness, sales and consumer loyalty (see Why Are So Many Brands Opening Boutiques?). Glossier is only the latest beauty rule-breaker to catch Silicon Valley’s attention. Like IVP, legendary startup funder Y Combinator has invested in some of the world’s top innovators, including Dropbox, AirBnB and Uber. The firm’s beauty-oriented investments have included e-commerce K-beauty innovator Memebox, which successfully pivoted from a beauty box subscription model to a fast fashionstyle beauty e-commerce behemoth, as well as StyleBee, a “marketplace for beauty services delivered at the convenience of clients’ location...” Y Combinator has also bet on Function of Beauty, which allows consumers to personalize shampoo and conditioner via online questionnaires and fragrance selections and have them shipped to their homes for $32.
perfecting their selfie (YouCam)
a
• 78%: portion of millennials who would be more inclined to buy • • • • • •
cosmetic products if they were able to try them out virtually prior to purchase (Poshly, Perfect365) 64%: portion of millennials who trust the recommendations of social media influencers over the salesperson in the store, even if they have worked with them before (Poshly, Perfect365) 57%: portion of survey respondents who were wary of buying cosmetics online because computer screen colors could vary (Harris Poll) 90%: portion of survey respondents that said they will buy a product wherever it is offered for the lowest price (Harris Poll) 65%: portion of U.S. women who feel “inundated by the size of the beauty] category” (Mintel) 7%: growth of the natural personal care market, 2015-2016 (Kline) 25%: mass merchandisers’ portion of natural personal care retail channel (Kline)
*www.canadean.com, www.poshly.com, www.cyberlink.com, www.harrispollonline.com, www.mintel.com, www.klinegroup.com
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Tress, a hair style app, has benefited from a Y Combinator fellowship.
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Function of Beauty, funded by Y Combinator, offers customizable hair care online.
Most recently, Tress, a hair style app, has benefited from a Y Combinator fellowship. The app allows women to discover and share hairstyles, access detailed hair style instructions, and locate hair products and salons. The app allows users to connect in a community for information sharing. The fail rate of Y Combinator startups is about 20%, according to a fascinating recent New Yorker articlea (beauty sector brands were not broken out of that number). And they are expected to grow quickly, according to the article: a
www.newyorker.com/magazine/2016/10/10/sam-altmans-manifest-destiny
The counter-theory is that YC actually does make its companies better, by teaching them to focus on growth above all, thereby eliminating distractions such as talking to the tech press or speaking at conferences or making cosmetic coding tweaks. YC’s gold standard for revenue growth is ten per cent a week, which compounds to 142x a year. For those ambitious dreamers who think their brand concept has what it takes to make it in Silicon Valley, applications for Y Combinator’s next batch of startups can be found here: www.ycombinator.com/apply/.
The New Cult of Shopper Experience While many traditional retailers are challenged by capturing young consumer excitement, many boutique beauty stores are opening to “offer a fun and interactive environment that isn’t found in other channels, which is appealing to younger, digital consumers,” according to Kline’sb Ewa Grigar. Typically located in “fun” locations, these boutiques offer brands opportunities to engage consumers with enhanced shopping experiences that boost their omnichannel strategy, while also offering brand building and awareness, sales and consumer loyalty. Recent research from Harris Pollc bears out this trend. The firm reported that roughly 90% of consumers shop in person for hair styling products, shampoos and conditioners, cosmetics, nonsunscreen products with SPF protection, and sunscreen. At the www.klinegroup.com; cwww.theharrispoll.com
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Kryolan’s NYC store features the brand’s full range of products and offers seminars in a dedicated classroom space.
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same time, 66% of consumers stated that they were more likely to make a cosmetics purchase if they can interact with the product in-person in-store.
Experience is Everything “It is almost like a cult, the followership is often buying into the exciting concepts of these stores virtually more than the products themselves,” said Kline’s Kelly Alexandre. “The success of such stores depends on whether brands can keep up with the pace of younger consumers’ digital needs, as well as keep a store’s levels of innovation and engagement high.” Grigar warned: “However, opening such a store is not the ticket to immediate success. Companies that cannot maintain a high level of innovation, keep up with the essential amount of interactivity and overall exciting experience are doomed to lower engagement and sales.”
Leaders in the boutique boom have crafted unique experiences with exclusive products, digitally integrated offerings, usergenerated content, and classes and consultations.
L’Occitane’s new New York flagship is modeled on a Provençal open-air market, featuring a Smart Beauty Fitting Room, “which allows the customer to browse products in a private, digital format that many are more comfortable in, while complimenting with a physical, and sensorial product sampling experience.”
FASTEST-GROWING BRAND BOUTIQUE CHAINS UNITED STATES
• Nature Republic • NYX • Rituals UNITED KINGDOM
• Sakare • Cowshed • Aesop Data courtesy of Kline Group
How Boutiques Create Consumer Engagement In the United States and Europe, many brands are debuting boutiques or expanding the number of doors, according to Kline, including Burberry’s Covent Garden high-tech boutique, Estée Lauder’s Estée Edit shop in London’s Carnaby Street, Bath & Body Works’ 23 new shops (in 2016) and the forthcoming Glossier shop (see Why Silicon Valley Loves Beauty). Leaders in the boutique boom have crafted unique experiences with exclusive products, digitally integrated offerings, usergenerated content, and classes and consultations. For example, NYX has invested heavily in boutiques, opening 20 U.S. stores, including a New York flagship. The new location features digital accents and in-person education for consumers. Education includes a Brush Bar for brush techniques, a Lash Bar for selecting false lashes, and a Masterclass area helmed by influencers and makeup experts. The Union Square-based NYX shop also includes a Beauty Bar makeup station, video tutorials, a trend-based Lip Bar and Shadow Bar, as well as a Colorcast wall, featuring color trends from around the world. The site also offers makeup classes, including contouring and brow mastery. Meanwhile, e.l.f. Beauty has opened a new NYC store at Columbus Circle, which is “designed to bring the beauty brand to life and connect its large network of makeup enthusiasts with a
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NYX opened 20 new stores last year, including a New York flagship (pictured).
L’Oréal Paris’ first boutique.
unique experience focused on the ability to play, experiment and engage with e.l.f.’s high-quality, innovative products.” In addition, Kryolan Professional Make-Up has set up shop in New York’s West Village. The store features all of the brand’s products, and offers classes and seminars in a dedicated classroom. On the other side of the pond, L’Oréal Paris has opened its first branded store in Paris, which is exclusively focused on cosmetics. www.GCImagazine.com
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The site offers 600 products, including 150 beauty exclusives. Each month, the outlet will offer a limited-edition makeup collection. Consumers can test the products and looks virtually using Makeup Genius, the brand’s augmented reality app. So, while beauty shoppers continue to expand their mobile shopping rituals (see Beauty Consumers by the Numbers), brick-and-mortar retail has a critical role to play in brands’ omnichannel strategies. Markets & Trends 9
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MARKETS & TRENDS
M&A Is Reshaping the Beauty Industry Since Global Cosmetics Industry published its last beauty care M&A report, Estée Lauder purchased Becca Cosmetics and Too Faced, Ant Capital Partners acquired Kagayaku Cosmetics and Coty purchased ghd, to name just a few. “It’s been a good year for beauty care,” said Anthony Valentino, deputy editor of consumer at Mergermarket.com, commenting on the first nine months of beauty M&A. In fact, he explained, every quarter of 2016 posted M&A activity that has been at or above that of the previous four to five quarters. In addition, the third quarter was one of the strongest in recent memory in terms of deal volume.
Acquire or Be Acquired A new report from A.T. Kearneyc sheds some light on the intensity of the acquisition environment, noting, “At this point, the industry is ripe for consolidation, and survival likely depends on acquiring or being acquired.” At the same time, A.T. Kearney found that the more acquisitions a company makes, the better each transaction performs: “Our research shows that frequent buyers—those that completed on average two transactions per year or more— increase value faster than infrequent buyers ... [F]requent buyers www.atkearney.com
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(mostly large companies) grew 63% more enterprise value over a six-year period than infrequent buyers of comparable size.” Practice makes perfect.
The e.l.f. Effect But not every brand necessarily wants to be acquired. e.l.f. Beauty, which achieved sales of $191 million in 2015, launched its IPO successfully. e.l.f. appeared to believe that it had a unique model for success, including rapid innovation and digital competency. Because of this, the brand appears to have determined that it can grow much further on its own, rather than sell to a motivated strategic buyer. Valentino noted that IT Cosmetics had pushed its sales into the hundreds of millions before going the M&A route. e.l.f.’s relatively rare IPO shows that a young fast-growing company can grow on its own, Valentino continued. Assuming the brand is successful, it’s conceivable that more brands could decide to take the IPO path. But, for now, it’s an exception.
Target-rich Environment Valentino explained that the beauty industry generally features businesses at either end of the size spectrum, with small up-andcoming brands on one end and major multinationals at the other (see How Consolidated Is the Industry?). In between are a few
HOW CONSOLIDATED IS THE INDUSTRY? A.T. Kearney found that consolidation has reached what it calls a “tipping point,” with several highly consolidated segments; all figures courtesy of Euromonitor/A.T. Kearney.
PREMIUM MARKET Market value: $19.9 billion Top three company market share: 49% Remainder market share: 51%
MASS MARKET Total value: $43.6 billion Top three company market share: 39% Remainder market share: 61%
DEODORANTS Total market: $4.2 billion Top three company market share: 75% Remainder market share: 25%
HAIR CARE Total hair care market: $12 Top three company market share: 62% Remainder market share: 38%
COLOR COSMETICS Total market: $14.4 billion Top three company market share: 51% Remainder market share: 49%
BATH/SHOWER Total market: $7.7 billion Top three company market share: 46% Remainder market share: 54%
FINE FRAGRANCE Total market: $7.8 billion Top three company market share: 38% Remainder market share: 62%
SKIN CARE Total market: $15.6 billion Top three company market share: 27% Remainder market share: 73%
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Estée Lauder purchased Too Faced for about $1.45 billion, based on projected 2016 sales of $260 million.
mid-sized companies that have grown but, for whatever reason, have not been acquired. This so-called barbell effect has resulted from the industry’s traditional brand life cycle and plays well into a strong M&A environment: a few big players with a wide array of small companies to consider. In addition to capturing digital expertise, high growth and profitability, top beauty companies are looking to enhance their cross-border activity. As a result, Valentino said, investment bankers have lots of targets to pitch to their clients. And top brands have lots of money on their balance sheets and are not growing as fast as they need to. While these dynamics were in place in 2015, Valentino said they seem to have “unlocked” in 2016. He added that deals tend to snowball as companies sitting on the fence finally feel compelled to jump into the market. Fortunately, there continue to be many assets out in the industry, said Valentino. At the same time, companies continue to come out of nowhere and grow rapidly, creating emerging opportunities.
Rising Competition As the number and valuation of acquisitions grows, it’s clear that companies will pay big money for growth. For this reason, strategic buyers may consider brands with sales below $100 million, though likely not lower than the $10-25 million range. More than 80% of transactions in recent years have been of a “strategic nature,” the A.T. Kearney report noted. High M&A valuations have kept smaller financial acquirers from www.GCImagazine.com
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M&A BY CATEGORY • • • • • •
Skin care: 25% Color cosmetics: 23% Hair care: 13% Other: 12% Fragrance 6% Devices: 3%
Figures courtesy of A.T. Kearney
participating as fully in the market, it added, which could expand competition.
Why Companies Buy Consumers are simultaneously trading down (affordable on-trend cosmetics) and up (natural products, premium beauty products), which, for example, have led to the TPG-e.l.f Cosmetics deal and Estée Lauder-L Rodin deals, respectively. A.T. Kearney found that the top purchase motivators (in descending order of importance) were: • Consumers (ex: multicultural consumers, millennials, generation Z) • Distribution channels (ex: Coty-OPI, Macy’s-Bluemercury, Target-DermStore, Sephora-Sack’s)
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• Innovation (ex: L’Oréal-Sayuki, SkinMedica-Colorescience, Estée Lauder-GlamGlow) • Markets
The firm’s research backs up previous insights into the motivations behind rising M&A activity: • Slow growth in core markets such as the United States (which is expanding at 3%/year, a situation which will continue in the next five years) and Western Europe • Slow growth in legacy brands • High consolidation in many categories (top three companies comprise 45% of the entire market) • High fragmentation in the remainder of the market • Need for expansion into new categories, geographies and channels
In addition, M&A is motivated by a need to acquire digital and social media capabilities, as well as general engagement with millennials. Mergermarket’s Valentino explained that young direct-to-consumer companies leveraging social media and digital distribution have been able to grow rapidly and achieve significant profitability. This makes startups doubly attractive propositions for private equity and multinational brands alike. Valentino added that larger incumbent brands don’t always excel at launching niche brands, and so rely on acquisitions to fill the innovation gap. In addition, multinationals may acquire manufacturing players to further integrate innovation. To illustrate, Unilever recently acquired Living Proof for an undisclosed sum, which simultaneously added a novel technology to the multinational’s portfolio and further built on
its prestige beauty holdings, which include Dermalogica, Kate Somerville, Murad and REN. The purchase was in line with Unilever’s recent acquisitions of Seventh Generation and Dollar Shave Club, which provided the company with needed footholds in natural products and male grooming, respectively. What makes the Living Proof acquisition different is its unique MIT-developed technology, which was refined by professor Robert Langer in conjunction with a team of biomedical scientists and hair stylists. The result, according to the brand, is a range of products that “enable people to get visibly healthier hair, fight frizz, build volume and address a number of other hair care challenges.” “We are delighted to be adding Living Proof to our portfolio of Prestige brands,” said Alan Jope, president of Unilever personal care. “The prestige hair retail market is very attractive and offers significant potential for growth. Through compelling product result demonstrations and influencer driven marketing, Living Proof is already a successful business in this space and we look forward to further developing and growing this wonderful brand.” Looking ahead, Mergermarket’s Valentino identified three key areas for potential beauty acquisitions: • K-beauty • Brands with access to BRIC markets • Emerging markets in general (see The Missing Piece: M&A in Developing Markets)
What They’re Paying Estée Lauder purchased Too Faced for about $1.45 billion, based on projected 2016 sales of $260 million (representing 70% year-over-year growth). This was the largest acquisition in Estée Lauder’s history. In 2014, L’Oreal paid a rumored $500 million for NYX, which then boasted annual net sales of $72 million (2013). When L’Oréal purchased IT Cosmetics from TSG Partners in July 2016, it paid $1.2 billion based upon 2015 sales of $300 million. These types of strategic acquirers can pay high multiples, compared to private equity. However, Valentino noted that the high profitability of today’s hot startup brands allows even private equity firms to pay high EBITDA multiples, therefore leveling the playing field to some degree. Looking at recent trends, Valentino said that it does not appear that high-multiple payments are leveling off, but rather increasing. Which means that the “big guys are driving the bus,” whether it’s Johnson & Johnson paying $3.3 billion for Vogue International based on annual EBITDA of $150 million or Unilever buying the Dollar Shave Club for a reported $1 billion in cash based on 2015 sales of $152 million.
The View from Private Equity
ACG invested in Pacifica because of its unique positioning within better-for-you beauty.
What does a private equity executive look for in a prospective investment? Julian Steinberg, managing partner of Alliance Consumer Growth (ACG), recently explained that his firm’s strategy is simple: seek out large categories in which consumer preference is shifting and in which there are opportunities for entrepreneurial businesses to meet those
12 Markets & Trends Global Cosmetic Industry | January 2017
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However, Steinberg stressed that ACG does not have a natural product-focused investment thesis. Rather, the firm is simply following the growth, driven by demographic changes, the rise of the millennial generation, and evolving consumer preferences for better-for-you products and brands. He added that, today, better-for-you is merely a baseline for growth. In order to attract investment dollars, brands must offer this, plus something extra.
Better-for-you is merely a baseline for growth.
A.T. Kearney found that less than 10% of M&A transactions “involved a company from a mature market acquiring a target in an emerging market ...”
needs, then find the disruptive brands within that space that offer a little something extra. ACG, which has invested in healthy and green brands in the food and beauty space, including Tata Harper and NudeStix, recently took a minority stake in Pacifica Beauty, which markets vegan and cruelty-free skin care, cosmetics, bath and body, fragrance, hair care and nail care products.
But why invest in beauty at all? Steinberg replied that the beauty industry is exciting because of the level of innovation coming from smaller independent brands. At the same time, larger strategic players have come to realize that their legacy brands will never achieve the growth rates of today’s upstarts. As a result, M&A has, to some extent, become the new R&D. ACG focuses on what Steinberg described as disruption leaders that are doing something exciting and differentiated in large categories. These brands, whether in pet food (The Honest Kitchen), fast food (Shake Shack) or beauty, offer “tremendous” value to the consumer for a relatively small premium. Pacifica was the right fit for ACG because of its unique brand voice, lifestyle positioning and, of course, its better-for-you products. ACG’s investment will boost the brand’s infrastructure, distribution and retailer support (the brand currently retails in Ulta, Target, Whole Foods Market and Sprouts, among other channels), and drive trial and awareness among consumers. By Steinberg’s estimation, Pacifica could grow to 10 or 20 times its current size.
The Missing Piece: M&A in Developing Markets
IVP invested $24 million in Glossier to boost its technology, expand the brand globally, launch products in new categories and open its first retail space. www.GCImagazine.com
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A.T. Kearney found that 8% of M&A transactions were focused on market access, but also noted that less than 10% of the transactions “involved a company from a mature market acquiring a target in an emerging market, presumably driven by more limited acquisition options available in these geographies or the higher risks of overseas transactions.” However, given the slow pace of expansion in mature markets, beauty leaders will need to get creative in acquiring local brands and, as a result, local insights into markets and consumer needs. A.T. Kearney’s report notes some mature-emerging market deals in recent years, including L’Oréal-Niely Cosméticos (Brazil), L’Oréal-Interconsumer Products (Kenya) and Coty-StarAsia (Southeast Asia). To date, there have been few instances of emerging market brands acquiring mature market brands. Most make lateral moves to other rising markets, rather than tacking the North American and European spaces. This can allow emerging market players to be “the big fish in a small pond.” Markets & Trends 13
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WELLNESS 2017
Consumers are increasingly focused on their mind, body and spirit, and brands are innovating to help them holistically feel and look their best.
∑ Wellness represents a $1 billion opportunity, but to succeed brands must focus on the consumer’s mind, body and spirit. ∑ Both millennials and aging baby boomers are concerned about longevity, vitality and ethics, putting wellness at the center of many demographics. ∑ In the future, brands will forge unique partnerships across industries (ex: athletic wear and beauty) to satisfy consumers’ needs for an active, healthy life.
| BY JEB GLEASON-ALLURED, Editor in Chief a
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f “feeling good is the new looking good,” as a recent McKinsey-BoF reportb noted, it’s no wonder that Pantone’s 2017 Color of the Year, Greenery, is a tribute to all things wellness. According to Pantone, the tone “is a fresh and zesty yellow-green shade that evokes the first days of spring when nature’s greens revive, restore and renew.” Leatrice Eiseman, executive director of the Pantone Color Institute, a
Additional reporting by Nicole Urbanowicz www.businessoffashion.com
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noted, “Satisfying our growing desire to rejuvenate and revitalize, Greenery symbolizes the reconnection we seek with nature, one another and a larger purpose.” The selection mirrors an increasing focus on proactive approaches to supporting the mind, body and spirit of consumers—in other words, wellness. As defined by the Global Wellness Institute (GWI)c, in line with the World Health Organization’s definition of health, wellness is: “a state of complete physical, mental and social well-being.” And, c
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increasingly, it’s big business for the beauty and personal care industry.
A $1 Billion Opportunity Over the last 30 years, consumers have gradually expanded their sense of wellness from physical fitness to a more holistic approach that encompasses every element of their lifestyles, including beauty, physical and mental fitness, apparel, nutrition and travel. Today, the global wellness economy— comprising preventative, complementary and alternative medicine; tourism; thermal/mineral springs; spas; workplace wellness; healthy foods, beverages and weight-loss aids; mind and body fitness; www.GCImagazine.com
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“This [older] group … [is] staying in the labor force longer, so they want to stay active and youthful because they are going to work frequently and, being part of a vital workforce, they want to stay healthy and well for that.” Wellness 2017 15
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3 Elements of Wellness
MIND (stress, sleep, cognition, etc.)
SPIRIT (ethical brands, philanthropy, sustainable practices, etc.)
BODY (general health, fitness, beauty, etc.)
Leatrice Eiseman, executive director of the Pantone Color Institute, noted, “Satisfying our growing desire to rejuvenate and revitalize, Greenery symbolizes the reconnection we seek with nature, one another and a larger purpose.”
and wellness lifestyle real estate—is valued at more than $3.7 trillion, according to GWI. Of that, beauty and anti-aging comprise about $1 billion. So it’s no wonder that, increasingly, beauty companies are pursuing a convergence of their traditional businesses with wellness. But are they doing it well?
Appealing to the Whole Consumer In practice, wellness brands address physical and mental health and fitness, spirituality, sustainability issues and ethical business practices— but few encompass all of these elements simultaneously. In its recent wellness analysis, McKinsey-BoF warned that this fragmented approach renders many brands uncompetitive, adding, “The more of these attributes that a brand can reflect and connect to, the stronger it will be, and the deeper the relationship it can create with the consumer … [T]he consumer segment is interested in personal, transformative experiences, often on the journey to a ‘better you’.”
Look At Me: Beauty at the Heart of Wellness
“I think there are many reasons why beauty and anti-aging are such a huge portion of this [wellness] industry,” said Laura FrererSchmidt, publisher of Women’s Health, during a recent Women’s Marketing presentation.d “It’s a very easy thing to change in your life. A face cream is something you can … transform your life with. I also think that beauty is one of the main ways that people visually judge health.” She continued, noting that consumers’ sharing of marathon participation and fitness tracker stats on social media had also fed into the overall performative nature of wellness and beauty. Schmidt added that, while traditional brands such as Pantene have stepped up their approach to wellness marketing, the movement has extended to the beverage sector, including Juice Generation, Juice Press and WelleCo, as well as nutricosmetic-type brands that offer elixirs that promote healthy skin and hair benefits. www.womensmarketing.com
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Wellness-obsessed Millennials During the Women’s Marketing presentation, the firm’s executive VP, marketing and insights, Marlea Clark, noted that 70% of surveyed women said that their health and wellness were priorities. “What I found really fascinating is that millennials are leading the healthy lifestyle movement,” she said. “In fact, 53% of them value health and wellness above work, spirituality and even friends … Eightyfour percent of millennials exercise at least once a week, and 69% take vitamins, minerals and supplements.” And, Clark said, even as they age, millennials will continue to focus on mindfulness and conscious consumption.
Wellness Is an Ageless Movement “The reason [wellness is] such a large trend is that it reaches beyond millennials,” Clark explained. “It really runs the gamut from millennials all the way to [baby] boomers and generation X. Clark noted that, according to research conducted by Olay, 85% of women in the U.S. believe that age is becoming less relevant. This portends a shift in thinking for marketers from demographics to psychographics in which consumers are viewed through the lens of their actions and beliefs, rather than simply their date of birth. Clark added that older consumers are living longer and have more leisure time with which to research and discover
Origins GinZing Energy-Boosting Moisturizer is “fortified with legendary skin-boosters like panax ginseng and coffee bean to jumpstart hydration levels,” reflecting consumers’ energy concerns.
products, creating “a lot of opportunity” for brands. “This [older] group has a lot more time to focus on wellness,” Clark noted. “They’re also staying in the labor force longer, so they want to stay active and youthful because they are going to work frequently and, being part of a vital workforce, they want to stay healthy and well for that.”
WELLNESS BY THE NUMBERS • $3.7 trillion: global wellness market (Global Wellness Institute) • ~$1 billion: beauty and anti-aging portion of the wellness market (Global Wellness Institute) • 70% of women say that their health and wellness is a priority (Women’s Marketing) • 53% of millennials value health and wellness above work, spirituality and friends (Women’s Marketing) • 84% of millennials exercise at least once per week (Women’s Marketing) • 69% of millennials take vitamins, minerals and supplements (Women’s Marketing) • 85% of U.S. women believe that age is becoming less relevant (Women’s Marketing) • 66% of consumers are willing to pay extra for products and services that come from companies that are committed to positive social and environmental impact (Nielsen) • $50 billion: total U.S. consumer spending on legal cannabis by 2026 (Cowen Group)
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24-hour Wellness From morning to night, Monday to Sunday, beauty brands are innovating to provide solutions tailored for specific day parts. A recent analysis by Mintel’s Sharon Kwek noted, “[B]eauty brands are synching with the body’s natural rhythms to provide solutions throughout the day. As a result, a new generation of products are being launched to enhance consumers’ lives from the moment they wake up in the morning until their heads hit the pillow at night.”
1. Wakeup Call According to Mintel’s Sarah Jindal, 28% of Americans say that fatigue is their second highest health concern, behind weight. As a result, an increasing number of brands are focused on providing the look and feel of energy and vitality, including: • Dirty Lemon’s Energy offers consumers vitality via a formula containing green tea and “adaptogenic herbs.”e e Adaptogens reportedly promote homeostasis, for example by reducing cellular sensitivity to stress.
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• Hum Nutrition Raw Beauty Green Superfood Powder, which “supports energy, radiant skin and a healthy metabolism,” and contains ginseng, astragalus, licorice, ashwagandha, eleuthera and rhodiola, which reportedly allow consumers to “energize and relax.” • Origins GinZing Energy-Boosting Moisturizer, which is “fortified with legendary skin-boosters like panax ginseng and coffee bean to jumpstart hydration levels.” • Clarins Booster Energy drops, which contain ginseng “to revive skin’s radiance and minimize the signs of fatigue.” • Blithe Energy Yellow Citrus & Honey Splash Mask, which is “formulated with citrus extracts and honey, aiding in brightening and energizing dull, tired skin.”
2A. Workout-proof Beauty A range of brands have produced beauty products that can withstand even the most intense workouts, including: • Sweat Cosmetics Translucent Mineral Powder, available in Natural Finish, “a lightweight, water- and sweat-resistant mineral powder sunscreen with SPF 30 and skin-friendly ingredients in [a] refillable, washable, twist brush.” The translucent mineral powder is water- and sweat-resistant up to 40 minutes, according to the brand. Sweat Cosmetics claims that, in clinical tests after one hour of workout activity, “84% of women felt that the product was still intact.” • Kat Von D Lock-It Powder Foundation is a smudge- and sweat-proof product that “won’t cake of crease.” • Make Up For Ever Mist & Fix Setting Spray is sweat-proof and designed to keep makeup looking fresh. • Smashbox Studio Skin 15 Hour Wear Foundation is “exercise-resistant and sweat- and transfer-proof for a flawless finish.” • Madison Reed Root Touch Up hides roots and locks in color “even through workouts and rainstorms.”
2B. Post-workout Beauty Routines Logically, a far greater portion of beauty and personal care products are poised to
provide benefits after workouts. Brands include: • Dry shampoos such as Sachajuan Dark Dry Powder Shampoo, Drybar Detox Dry Shampoo and Christophe Robin Detox Hair Ritual Kit. • Jack Black Performance Remedy Turbo Wash Energizing Cleanser for Hair & Body, which reportedly “jump-starts the body, awakens the mind, and helps revitalize the immune system,” and contains juniper berry, which the brand says “assists in post-workout recovery, helping to eliminate lactic acid build-up in muscles.” • Origins Warm Down Warming Lava Scrub to Detox and Smooth, which reportedly “relaxes sore muscles and detoxes skin post-workout.” • Murad Clarifying Body Spray is an acne treatment spray that can be used for post-workout refreshment. • Sweat Cosmetics Skin-Balancing Cleansing Wipes contain vitamin E, coconut water, green tea extract and provitamin B5 and are designed to offer a cool-down post-workout for the face and body. • First Aid Beauty Hello FAB Gym Bag Essentials Kit is a mobile set for healthy post-workout skin and includes a Face Cleanser, Ultra Repair Lip Therapy, a cooling Vital Greens Face Mist and moisturizing Coconut Skin Smoothie Priming Moisturizer. • Giovanni Cool Mint Lemonade Salt Scrub “tingles with fragrance and is
Sweat Cosmetics Skin-Balancing Cleansing Wipes contain vitamin E, coconut water, green tea extract and provitamin B5 and are designed to offer a cool-down post-workout for the face and body.
2. Hit the Gym Jindal explained that 42% of consumers ranked physical wellness—vitality, quality sleep, and an absence of aches and pains—as their top wellness factor, followed by mental health and sharpness, and nutrition. In fact, Mintel found that 64% of consumers reported exercising regularly, with 44% doing it to look better. In response, brands are incorporating fragrances and cooling and warming effects to help consumers get amped up for their workouts or to cool down and sooth sore muscles afterward.
Salty Bath recently introduced its Salty Box beauty box program, touted as its own “mini spa,” which is purported to support restful sleep.
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an invigorating body exfoliator that polishes the skin’s surface, removing cellular debris,” ideal for post-workout rituals.
3. Sweet Dreams On a daily basis, the media seems to be touting a new study on the benefits of sleep, from academic performance to mental wellbeing to general cognition and even income.f No wonder television and social media channels seem to be flooded with a growing number of mattress ads from established and emerging companies, all promising a good night’s sleep. Mintel’s Jindal explained that consumers are increasingly focused on brands that will help them get up in the morning feeling refreshed and re-energized and ready for their day. For example, wellness brand Salty Bath recently introduced its Salty Box beauty box program, touted as its own “mini spa.” The offerings include small-batch bath soaks, body products, healing crystalsg, candles, soaps and bath bombs. “Studies have shown that women, who exercise regularly, eat right, get sufficient sleep and find satisfaction in their work and personal lives have less depression, anxiety and illnesses, such as heart disease,” Salty Box noted in an official statement. Co-founder Tami McCarthy added, “If we do just a few things regularly, to renew our energy and revitalize our spirit, we can be fully present in our own lives, enjoy life more, and provide for our families from a place of abundance … With Salty Bath, we want to be the transformation agent that helps you get the job of self-care done, because we know it will help you reduce stress, and sleep better ...” Meanwhile, Dirty Lemon’s Sleep makes a restful proposition with rose water, herbs and magnesium, while VitaFusion offers www.washingtonpost.com/news/wonk/ wp/2016/11/13/the-more-you-sleep-the-moremoney-you-might-make/ g Well + Good’s 2017 wellness trend overview noted that, “for a generation raised on yoga, meditation, and green juice, formerly fringe ‘woo woo’ wellness concepts are becoming downright mainstream,” and added, “Crystals are increasingly celebrated as life-enhancing, whether as jewelry or in home design, by everyone from Jennifer Aniston and hiphop stars to fitness phenom Taryn Toomey”; www.wellandgood.com. f
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Shea Moisture, which offers detox hair care, proves that brands can provide wellness at a mass pricepoint.
natural Beauty Sleep Gummies, which are powered by vitamin D and melatonin for sleep support and “awaking refreshed.” Similarly, Hum Nutrition’s Beauty zzZz offers a vegetarian tablet containing melatonin for “restful beauty sleep.”
Wellness for the Masses Whether it’s Gwyneth Paltrow’s Goop, wellness spas or yoga retreats, it’s clear that many wellness lifestyle elements have their origins in the premium and luxury space. Recently, Julianne Escobedo Shepherd, writing for Jezebel. com, observed in “Athleisure Is Not For You” that, “A person who is able to work out three hours a day has a schedule that doesn’t resemble yours, I’m guessing … Workout culture is inextricably tied with celebrity and wealth, this glamorous, nebulous luxury afforded only to the group we might as well call the idle fit.” However, Mintel’s Jindal explained that, while wellness trends emerge in the prestige space, they do trickle down. For instance, Target has touted many natural beauty and personal care brands in recent years, including Dr. Bronner’s Shea Moisture, W3ll People, Yes To and Burt’s Bees. Shea Moisture, one of the fastest-growing hair care brands in the market, offers products that reinvigorate
tired skin or destress the hair. The brand’s Detox Hair & Scalp Gentle Shampoo retails for $10.99 and comprises shea butter, activated charcoal, ginger and other ingredients that offer a gentle cleansing and revitalization. Much of this trickle down can be attributed simply to the broad consumer trend toward more natural products. According to a recent analysis from Persistence Market Research,h the global natural and organic personal care products market will reach a value of $11,057.1 million in 2016, representing year-over-year growth of 9.7%. By 2024, the market is expected to be worth $21,776.9 million. Such growth is the marker of a trend that has expanded far beyond niche. In fact, according to recent Kari Gran research, 35% of women surveyed plan to purchase more “all natural” beauty products in the next two years than they currently do, with 48% of millennials answering in the affirmative. To illustrate the interest among younger consumers, Kari Gran found that 73% of millennials believe it’s important to choose natural beauty products, compared to 59% of women aged 35–44. www.persistencemarketresearch.com
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2017’S TOP 4 BEAUTY WELLNESS TRENDS Wellness media trendsetter Well+Good recently published its 2017 Wellness Trends, which spanned multiple industries, including food, fitness and travel. Beauty and personal care dominated much of the list, so Global Cosmetic Industry dug deeper to see how these trends are already manifesting in the industry and maretplace.
1. CLEANING UP As consumers increasingly scrutinize product labels (see Food Inspiration), beauty and personal care brands are stepping up with a focus on clean, natural and organic formulations. Those preferences are impacting every element of the industry, including M&A activity. Recently, Alliance Consumer Growth (ACG), which has invested in healthy and green brands in the food and beauty space, including Tata Harper and NudeStix, took a minority stake in Pacifica Beauty, which markets vegan and cruelty-free skin care, cosmetics, bath and body, fragrance, hair care and nail care products. Julian Steinberg, managing partner of ACG, noted that the firm doesn’t have a natural product-focused investment thesis. Rather, ACG is simply following the growth, driven by demographic changes, the rise of the millennial generation, and evolving consumer preferences for better-foryou products and brands. (By Steinberg’s estimation, Pacifica could grow to 10 or 20 times its current size.) He added that, today, better-for-you is merely a baseline for growth. In order to attract investment dollars, brands must offer this, plus something extra.
Financial services firm Cowen Group has forecasted that “consumer spending in the legal [U.S.] cannabis market will grow to $50 billion by 2026.” As a result, Well + Good found that brands are looking to exploit the public’s growing appetite for all things cannabis, including natural beauty and personal care products. For instance, Skinvisible Pharmaceuticals, Inc., has licensed the exclusive world rights to its topical and transdermal cannabis products formulated with Invisicare to CannaSkin, LLC, a cannabis product licensing company. And Growblox Sciences, Inc., has announced that it has acquired two Medical Marijuana Establishment licenses in Clark County, Nevada, and formed GB Sciences Las Vegas in order to acquire these two licenses, which allow Growblox to convert cannabis plants to oil, which can be used to manufacture beauty aids, cosmetics and other products. And Canadian Zeolite Corp. has partnered with Isodiol to research and develop cannabidioland zeolite-infused products, including anti-aging skin care.
3. DRINK YOURSELF BEAUTIFUL Functional beverages—mixes and RTDs—are nothing new, but their popularity is expanding rapidly, growing at 11.4% through 2021 and
2. LEGALIZE IT Marijuana was the clear winner of the 2016 U.S. elections, with recreational use of the drug legalized in California, Maine, Massachusetts, Nevada, Colorado, Washington, Oregon, Alaska and the District of Columbia, while medical marijuana was legalized in Florida, Arkansas and North Dakota.
“[C]onsumer spending in the legal cannabis market will grow to $50 billion by 2026,” according to Cowen Group.
Beauty drinks are all the rage, promising better skin, healthier nails, better sleep and more.
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Marketing Your Ethics
totaling more than $1.1 billion by the end of the forecast period, according to a Market Data Forecast report. Aimed at women and teenagers and promising healthier skin, leading brand innovators include Bella Berry Beauty, Skinade, Blossom Du Jour, The Beauty Chef and MoonJuice. Top claims in the space include: anti-aging, radiance, detoxifying and vitality. Top ingredients include: vitamins, minerals, fruit extracts, coenzymes and proteins. From great skin to healthy nails and joints, collagen has grown in popularity, particularly in the beauty drink space. Examples include Dirty Lemon Skin+Hair, Vida Glow marine collagen supplements derived from red snapper scales, Fountain The Phyto Collagen Molecule drink and Bella Berry, which comprises super fruits such as pomegranate and acai, as well as vitamins, antioxidants, collagen and green tea extract.
4. NATURAL-ISH Alicia Keys’ no-makeup appearance on The Voice was a high-profile moment in the #nomakeup trend, but it’s safe to say that reports of makeup’s death have been greatly exaggerated. No7 Match Made Service spokesperson and feminist novelist Chimamanda Ngozi Adichie perhaps put it best: “I love makeup, and its wonderful possibilities for temporary transformation. And I also love my face after I wash it all off. There is something exquisitely enjoyable about seeing yourself with a self-made new look. And for me that look is deeply personal. It isn’t about what is in fashion or what the rules are supposed to be. It’s about what I like. What makes me want to smile when I look in the mirror. What makes me feel slightly better on a dull day. What makes me comfortable.” Indeed, while many women ditch makeup on occasion and share their natural looks on social media, the no-makeup makeup look has risen up to bridge the desire for authentic beauty and the impulse to boost one’s natural looks. The trend has given rise to countless product categories and SKUs, including Bareminerals Gen Nude Matte Liquid Lipcolor, Marc Jacobs Beauty New Nudes Sheer Gel Lipstick, Buxom True Nude Lip Foundation.
“There is something exquisitely enjoyable about seeing yourself with a self-made new look,” said No7 Match Made Service spokesperson and feminist novelist Chimamanda Ngozi Adichie.
Speaking during the Women’s Marketing presentation, Clark cited Nielsen figures that found 66% of consumers were willing to pay extra for products and services that came from companies that were committed to positive social and environmental impacts. “They’ll be looking for eco-friendly products and services across the different industries as well as ethically sourced and produced products,” she noted. “They want transparency—that’s a word we hear so often and we hear it across category. They really want to feel that if Walmart or Costco is going to be offering them organic, they know where that’s from … and they are telling the truth.” In response, global brands have expanded their communications around sustainability and ethics. For instance, the Estée Lauder Companies recently published “Future Beautiful: Our Progress on Sustainability and Citizenship in 2016,” which outlined how its efforts had impacted products and packaging, employee wellbeing, operational efficiency and citizenship. The company highlighted its charitable efforts to improve girls’ education around the world, its matching program for employee volunteers and monetary donations, and its 2020 net-zero greenhouse gas emission target. Meanwhile, numerous beauty brands have attained B Corp. status, which certifies for-profit companies that “meet rigorous standards of social and environmental performance, accountability and transparency.” B Corp. beauty players currently include Davines, Antica Roisterer SpA A, Pour le Monde Parfums, Beautycounter, Teadora, Dr.Hauschka and many more. The demand for high-profile ethics has inevitably trickled down to the supplier level, as with DSM Personal Care, which recently had its Vouvry, Switzerland, site awarded the “Fair Trade” seal of approval according to the ESR Standard, which comprises ethical pricing, “creditable” working conditions, and agricultural education and sustainability for farmers.
Food Inspiration Consumers have become increasingly aware of the ties between nutrition and skin health, creating a greater focus on www.GCImagazine.com
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the connections between diet and overall wellness. At the same time, Frerer-Schmidt noted, consumers continue to express concerns over the safety of synthetic/ industrial ingredients and are seeking more “natural” and “gentle” ingredient lists. As such, brands have drawn formulation inspiration from the food, drink and nutrition world, including: • acai (ex: Sugar Acai Age-Delay Body Cream, Perricone MD Super Berry with Açaí - Dietary Supplement Powder, Chosungah 22 Click Click Click Multi Color Lip & Cheek Tint, Sol de Janeiro Brazilian Bum Bum Cream, Fresh Brown Sugar) • almond oil (ex: L’Occitane Cleansing And Softening Shower Oil With Almond Oil, Bumble and bumble Hairdresser’s Invisible Oil Primer, Nude Skincare ProGenius Treatment Oil) • argan oil (ex: Josie Maran Warm Apple Cider Argan Oil Body Collection, Bumble and bumble Hairdresser’s Invisible Oil Conditioner, Ren Moroccan Rose Gold Glow Perfect Dry Oil, Nails Inc. Superfood Nail and Cuticle Repair Oil) • bilberry (ex: Cover FX Mattifying Primer With Anti-Acne Treatment, Peter Thomas Roth Cucumber Gel Mask, Bareminerals Oil Obsessed Total Cleansing Oil, Ole Henrksen Invigorating Night Crème, Herbivore Moon Fruit Superfruit Night Treatment, Hanae Mori Hanae Mori Butterfly Eau de Toilette) • coconut oil (ex: Bumble and bumble Hairdresser’s Invisible Oil Primer, Herbivore Coco Rose Coconut Oil Body Polish, Kopari Coconut Melt) • chia (Perricone MD Chia Serum, Herbivore Phoenix Cell Regenerating Facial Oil, DevaCurl Low Poo Delight) • flaxseed oil (L’Occitane The Secret to Beautiful Hands, Moroccanoil Intense Hydrating Mask, DevaCurl Low Poo Delight) • goji berries (Smashbox O-Gloss Intuitive Lip Gloss With Goji Berry-C Complex, Hourglass Opaque Rouge Liquid Lipstick, Lancome Énergie de Vie The Overnight Recovery Sleeping Mask, Bvlgari Omnia Coral) • kale (Youth To the People Kale + Spinach + Hyaluronic Acid Age Prevention Cream, Farmacy Hydrating
Coconut Gel Mask – Soothing, Bite Beauty Amuse Bouche Lipstick, Nails Inc. NailKale Nail Polish) • kombucha (Fresh Black Tea Instant Perfecting Mask, GlamGlow PoutMud Fizzy Lip Exfoliating & Wet Lip Balm Treatment Duo, Murad Anti-Aging Moisturizer SPF 30 PA+++) • pomegranate (Wen By Chaz Dean Pomegranate Strength & Hydration Kit, Korres Pomegranate Balancing Cream-Gel Moisturiser, Sephora Collection Sleeping Mask – Pomegranate, Klorane Color Enhancing Anti-Fade Shampoo with Pomegranate) • quinoa (Briogeo Be Gentle, Be Kind Avocado + Quinoa Co-Wash, Bareminerals Revamped Lash Domination Volumizing Mascara, DevaCurl One Condition Decadence) • spirulina (Bumble and bumble Seaweed Shampoo, Nails Inc. Overnight Detox Nail Mask, Erno Laszlo Firmarine Double Cleanse Travel Set, Origins By All Greens Foaming Deep Cleansing Mask) Mintel’s Jindal noted that many brands are seamlessly blending food-derived ingredients with peptides and functional ingredients such as hyaluronic acid, giving consumers the best of both worlds.
Beauty Care Restructuring for Wellness “Wellness is a way of life and a rich opportunity for brands,” Clark noted during the Women’s Marketing presentation. “And the psychological needs are sparking their broader lifestyle choices, so think about that when you think about how can your brand offer an experience rather than feeling that they’re just satisfying a shortterm acquisition or need.” Clark added that brands must be proactive in engaging consumers on their preferred print, digital, mobile, e-tail and social channels, using a consistent brand voice that feels authentic, honest and transparent. She concluded, “That’s important so that consumers feel they know what you stand for...” According to Avon, wellness comprises 33.5% of total direct channel sales and grew at 16.3% in 2015. In response, the
Shiseido has established a new group, Shiseido Venture Partners, which will invest as much as 3 billion yen/$26.3 million in innovative businesses with technology that can enhance Shiseido’s brand offerings, including in the wellness space. First up is an investment in dricos, Inc., which is “developing a supplement appliance [pictured] that provides necessary nutrients, individually selected based on the analyzed biometric/anthropometric data.”
company has created a new role, president of health and wellness, and appointed Anjana Srivastava. Launching this year, the new initiative will focus on strategic partnerships, new product launches and innovation for the marketplace. “As we transform New Avon into the leading social selling company in North America, we look forward to establishing a health and wellness destination valued by consumers, while maximizing the opportunity for our representatives to grow their businesses and their earnings,” said Avon CEO J. Scott White. Srivastava, who previously held product, marketing and scientific roles with companies such as NeoLife International and Shaklee Corporation, noted, “As the company for women, Avon is committed to taking a leadership position on the issues that matter most to women—and her family’s health and nutrition is a top concern. An increasing number of consumers are seeking ways to improve their health and vitality as they are becoming aware of worsening obesity trends and incidence of chronic diseases.” Meanwhile, Shiseido has established a new group, Shiseido Venture Partners, which will invest as much as 3 billion yen/$26.3 million in innovative businesses with technology that can enhance Shiseido’s brand offerings, including in the wellness space. First up is an investment in dricos, Inc., which is “developing a supplement appliance that provides necessary nutrients,
p a
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individually selected based on the analyzed biometric/anthropometric data.” Shiseido noted that, “Going forward, Shiseido will strive to develop new services utilizing the products and services of dricos.” The new business unit will also serve to educate Shiseido’s staff on the rapid innovation culture of the venture industry, “as well as the process and speed of commercialization of original business ideas.”
4 Ways Brands Are Getting Well
Credo is working to onboard novice consumers to clean beauty by providing an easy, accessible Discovery Kit.
1. Experiential Retail That Gives Back philosophy recently unveiled its concept wellbeing beauty workshop in the Westfield Garden State Plaza in Paramus, New Jersey. According to an official press release, “the environment invites you to mindfully engage the senses on an individual level through touch, sight, sound and scent.” The store carries the brand’s skin care, fragrance, and bath and body brands, and supports its hope & grace initiative, which donates 1% of all U.S. sales to mental health programs. “The hope & grace initiative represents an unprecedented and unending commitment by philosophy to support mental health and well-being,” the company announced on its website.
Love Goodly provides a monthly beauty box containing four to six full-sized cruelty-free, organic, non-GMO, eco-friendly and vegan products that “are safe for ourselves and our families at a reasonable price,” and “are better for our planet.”
“Mental health issues are one of the greatest challenges women face.” The philosophy concept store offers various experiences for consumers,
philosophy’s wellbeing beauty workshop carries the brand’s skin care, fragrance, and bath and body brands, and supports its hope & grace initiative, which donates 1% of all U.S. sales to mental health programs. www.GCImagazine.com
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including personalized consultations, “discovery stations” for various elements of the brand and guided meditation delivered via virtual reality.
2. Wellness Delivered Riding the popularity of monthly beauty subscription boxes, Salty Bath has launched its own mini spa version targeted toward niche consumers who are more focused on a healthy mind, body and spirit. Each Salty Bath box (which start at $27.95 per month) comes with a variety of small-batch bath soaks, body products, healing crystals, candles, soaps and bath bombs. “If we do just a few things regularly, to renew our energy and revitalize our spirit, we can be fully present in our own lives, enjoy life more and provide for our families from a place of abundance,” said Salty Bath co-founder Tami McCarthy.
3. DIY Wellness In the age of Blue Apron cook-it-yourself delivery kits, it was only a matter of time before similar beauty models emerged. Oleum Vera, a “home-cooked” beauty brand, offers cleansing, moisturizing, body care, spa-style pampering, hair care and men’s body care kits that allow consumers to whip up their own products. Each organic, non-GMO kit comprises plant-based oils and essential oils, powdered clays (when applicable), algae and dried flower petals, and comes with a how-to booklet. The brand said that it “takes inspiration from bountiful nature to create products that empower consumers to reclaim their beauty regimen, using fresh ingredients from their pantry and fridge, natural clays, and organic butters and oils.” Oleum Vera added that it is “providing women and men with the ingredients and the knowledge they need to re-appropriate their body care routine and tailor it to meet their own unique skin and hair needs…” The range, which touts its sustainability and customization, is currently available in France via OleumVera.com and BienManger.com.
4. Brand-retail Partnerships Oleum Vera is a “home-cooked” beauty kit brand that allows consumers to whip-up their own products.
Similarly, Love Goodly provides a monthly beauty box containing four to six full-sized cruelty-free, organic, non-GMO, eco-friendly and vegan products that “are safe for ourselves and our families at a reasonable price,” and “are better for our planet.” The brand donates 5% of every purchase to a charitable cause. Subscribers can shop for brands individually at the company’s site. Meanwhile, Credo is working to onboard novice consumers to clean beauty by providing an easy, accessible Discovery Kit containing products such as deodorants, shampoos and bath products. The kit allows consumers to experiment with select products, making the process of transitioning their cabinets to clean beauty easier. Credo will soon launch additional kits that target specific parts of the regimen.
Beauty and personal care brands and retailers have begun forming unique collaborations to capture millennials, genXers and Latinas, who are the future of the industry. U.S. millennial households spent $461 million on beauty products in a single year, while gen X households spent $337 million in the same period, according to Nielsen figures cited by analyst firm GMDCi. In addition, Latinos comprised 16% of total hair care sales, 14% of fragrance sales and 13% of cosmetics sales. GMDC recently issued an analysis of a collaboration between Unilever and CVS,
which effectively “connected beauty care, health care and self-care in the skin care aisle.” The program was designed around CVS’ two core skin care shoppers: the advanced regimen/high-end consumer and the basic product/limited regimen consumer. The brand and the retailer paired skin care brands—Dove, Vaseline and Simple—with non-branded skin health information curated by dermatologist Dr. Mona Gohara via the “Love Your Skin” campaign. The program currently includes the following segments: Face (moisturizer, wipes, cleansing), Shower (bar, body wash) and Body (creams, serums, lotions, lips).
What’s Next? As seen with CVS and Unilever, the intersection of wellness and beauty will lead to new partnerships between brands, Jindal explained. For instance, a fragrance brand could pair up with an athletic wear brand to offer a collection of products that rely on aromatherapy or other sensory triggers to manage one’s energy levels throughout the day. In addition, the continuing overlap between beauty and functional drinks will create new offerings for consumers, such as topical products that work handin-hand with a beverage. Similarly, technology brands and beauty firms can continue to find new ways to collaborate for a more connected version of wellness. And, more generally, consumers will seek out brands that 1) can stand up to their active lifestyles on the go, in the gym and beyond, 2) that offer functional benefits, 3) offer a safe/clean/natural formulations and 4) are easy to use and carry around during their busy day. Whatever’s next for the industry, it’s clear that the winners will offer consumers a “better you.”
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WELLNESS 2017
As brands vie for sustainability leadership, consumers’ expectations are growing.
| BY IMOGEN MATTHEWS, consultant to in-cosmetics Global
∑ Sustainability is a deciding factor for many consumers choosing among brands. ∑ Initiatives have evolved beyond ecology to resource conservation and social responsibility. ∑ Whether sustainability expertise is native to a brand or not, consumers expect authenticity and clarity in labeling.
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t the heart of the argument for the creation of new sustainability protocols and standards are the changing demands of the beauty and personal care consumer. New research from Canadean* confirms * Candean, Organic Monitor and Marie Alice Dibon will deliver marketing trends presentations at the 2017 in-cosmetics Global in London, which takes place April 4–6. Further information at www.in-cosmetics.com.
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that 51% of consumers globally say their beauty and grooming product choices are often or always influenced by how environmentally friendly/socially responsible the brand is. “Living ethically is of growing importance to today’s consumers, particularly as awareness grows of social and environmental issues,” said Jamie Mills, analyst at Canadean. “This can be attributed to the accessibility to information, as well as those issues being at the forefront of global and national agendas. In turn, this concern is trickling down to influence the choices of today’s consumers.” Global Cosmetic Industry
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L’Oreal has made a commitment with its Sharing Beauty With All pledge and was granted an “A” rating by the CDP in the areas of fighting deforestation.
Mills argued that accreditation for issues such as fair trade and recyclable packaging are an imperative, as is greater action by brands to include sustainability initiatives at the product level and across the wider brand ethos.
Beauty’s Sustainability Leaders So which brands are doing it best? Sustainability pioneer Weleda, for example, has undertaken ethical sourcing of raw materials for decades, while Neal’s Yard Remedies was the first UK high street retailer to go carbon neutral. Neal’s Yard Remedies purchases carbon offsets from wind power projects in India www.GCImagazine.com
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and China, supplied by The CarbonNeutral Company, and has devised a “Carbon Action Plan” to deliver its carbon emission reductions. The brand uses its CarbonNeutral certification in advertising, catalogues, shop windows and its website. “What has changed in recent years is that large multinationals and conventional brands are also now investing in sustainability,” said Amarjit Sahota, CEO of Organic Monitor. “It is common for many such companies to develop natural lines (reflecting green formulations), reducing packaging footprints, etc.” Another approach is for companies to “buy green expertise,” such as Unilever’s purchase of the green brand Seventh Generation, with the plan to reengineer its product formulations.
Waste Not Beauty companies, including Unilever and P&G, are recognizing the commercial benefits of reducing energy use and water footprints and optimizing waste management. Grupo Boticario, the second largest cosmetics company in Brazil, has switched to green polyethylene packaging for its Cuide-se Bem brand. The polyethylene is made from sugar, rather than petroleum, therefore saving more than 90 tons of plastics per year.
“There are also cost benefits since moving to eco-design, as there is 10% less plastic material used in the packaging,” said Sahota. “Similarly, P&G has made a commitment to have zero waste to landfill; it currently has 68 zero-waste manufacturing sites across the globe.”
Less is More Sometimes, brands come unstuck when taking a particular stance. Taking parabens out of formulations, for example, was once a ploy used to sell products. Only two of the parabens in use in the industry actually showed mild toxicity upon scientific review, but now microbiome science is again bringing the issue of preservation back into focus.** However, Marie Alice Dibon, founder of Alice Communications Inc., explained that companies that jump on the latest sustainability issue often do so without the correct knowledge about the science behind it. “Understand it,” she advised. “Hire the people that can help you communicate internally about it, informing all levels. Not everyone needs a Ph.D. in science, ** Read more: “Ingredient Hysteria and Misconceptions” from the January 2014 issue of Skin Inc.; www.skininc.com/magazine/ pastissues/2014/
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but everyone who works in our industry needs to understand at least the basics and follow the news.”
Authentically Sustainable According to Dibon, authenticity and ethics are values that run throughout an organization, but are tricky to communicate. “They’re not [just] injected into a product one morning because we choose to convey them now,” she explained. Dibon believes that the beauty industry needs to be proactive in order to set industry guidelines, as well as labels to reassure the consumer. If the big players apply best practices, these will pull the industry up as a whole. “We can’t make the same mistake as we did with organic products,” she warned, “with too many certifications in the European Union and not enough in the United States.” She added, “A good social media policy is essential as it helps with transparency. But there is no magic bullet and it will take time.”
Sustainability’s Evolution Sustainability is a nebulous term, but has been moving up the public’s political and economic agenda as businesses adopt responsible practices toward the sourcing and manufacturing of their products.
Neal’s Yard Remedies pioneered many sustainability initiatives.
Weleda has been undertaking ethical sourcing of raw materials for several decades
Grupo Boticario, the second largest cosmetics company in Brazil, has switched to green polyethylene packaging for its Cuide-se Bem brand.
Companies can buy green expertise, as with Unilever’s purchase of the green brand Seventh Generation.
In beauty, it began with a move toward natural and/or organic formulations and has since moved on to sourcing ingredients ethically and producing ecofriendly packaging. For example, Unilever is currently undertaking advertising campaigns which emphasize social good causes, as part of its Sustainable Living Plan, which aims to expand its business whilst reducing its environmental footprint. The program, which achieved an overall score of 92 out of a possible 100 on the Dow Jones Sustainability Index, recently created a partnership with vanilla supplier Symrise, Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and Save the Children to improve the livelihoods of vanilla farming communities in Madagascar. Similarly, L’Oreal has made a commitment with its Sharing Beauty With All pledge. Recently, the company was granted an “A” rating by the CDP in the areas of fighting deforestation, “especially for its sustainable sourcing actions of raw materials [such as palm oil and timber] used in its products’ packaging and formulas.”
The Future of Sustainability The growing refugee crisis, economic migrants in Europe and the United States, the rise of far right political parties and Brexit—all of these issues will impact on the way brands do business in the future. As a result, Organic Monitor has forecasted that social issues will feature more prominently in sustainability in the future, as social inequality, developing world poverty and political unrest continue to have a profound effect on consumers’ lives. “Key environmental and social issues the planet faces today are not the same as those it faced 20 or 10 years ago,” said Sahota. “The same will be true in five to 10 years’ time.”
IMOGEN MATTHEWS is a consultant to in-cosmetics. For more information, contact www.imogenmatthews.co.uk.
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WELLNESS 2017
How social philanthropy drives consumers’ decisions
∑ Ninety-six percent of consumers say that they are more likely to choose a philanthropic product over a non-philanthropic brand of the same general quality. ∑ Philanthropic support can gain sales and cause consumers to talk about your brand on social media. ∑ Unsurprisingly, female consumers are most interested in supporting femalecentric causes.
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| BY DENISE HERICH, The Benchmarking Company
B
eauty brands have been supporting philanthropic causes for decades, but the advent of social media has made sharing these viral campaigns with consumers practically effortless. From poverty to cancer research to education to end violence, we asked more than 4,400 beauty consumers to tell us* why social philanthropy matters to them, and to the industry overall. When asked specifically about brands becoming more socially conscious, 88% agree they have noticed that more brands are supporting social causes, and 96% say that when given the choice between a product which supports a philanthropic cause and one which does not (of the same price and quality), they are more likely to choose the philanthropic product.
Philanthropy Drives Loyalty At the heart of social giving and cause-based beauty is the very real fact that women just feel better when they use their spending power for philanthropic missions. In fact, 97% of women surveyed said they feel good supporting a brand that stands for a cause or donates a portion of its sales in support of missions such as fighting poverty, ending human trafficking or breast cancer research, etc. As brands show their social responsibility via philanthropy, consumers see themselves as contributing to the greater good through their actions (and dollars). This helps them to connect with your brand on two levels: as purchasers and good citizens. These kinds of connections help foster long-term loyalty and make it easy for consumers to decide who to reward with their repeat business. The brand that understands them both as a beauty consumer and a human stands to win big. Plus, giving back just feels good.
Sharing the Goodness The emotional part of philanthropy makes consumers want to share their experiences: 74% of beauty consumers agree that they are more likely to like, tweet, pin, or pic your brand and products with their online social circles if your company supports a charitable cause. Online survey of 4,455 U.S. female beauty buyers, September 2016; The Benchmarking Company. *
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Coastal Salt & Soul donated $0.25 from every Heavenly Hand Cream sold to CharityWater.org.
It’s worth noting that a commitment to your chosen social mission is critical, because consumers are watching.** Once your brand has targeted and picked a cause or charity to support, proceeds must go to that cause, and ideally, this giving should be a long-term relationship. Consumers are sensitive to brands that say one thing and then do another, particularly with regards to cause-related giving. Pick your partner wisely, and support them whole-heartedly if you want your social program to really make an impact with consumers.
70% of women say
they are more likely to buy a product from a company that supports a social issue.
Capturing New Consumers Whether the brand is big or small, 88% of consumers say that if a brand is willing to throw its support behind Learn more about cause marketing best practices in Sheri Koetting’s “Does Your Beauty Brand Have a Purpose?” from the March 2016 issue; www.gcimagazine.com/ magazine/pastissues/2016/ **
a philanthropic mission, they want to support that brand. Philanthropy even informs her future purchasing decisions. When considering a new beauty product, 70% of women say they are more likely to buy a product from a company that supports a social issue; 58% are willing to pay more for products that support a social mission (61% of
women are willing to pay 10% more for socially conscious products; 26% between 11% and 20% more). This translates into more potential future sales and brand exposure as these consumers are the ones taking to social media to tell their extended group of friends and influencers what products they just purchased—and why.
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The causes consumers would most like brands to support are, not surprisingly, heavily focused on women’s issues, including: women’s cancers (76%), domestic violence (69%), human trafficking (64%) and poverty (54%). Other important causes are children’s cancers (70%), animal testing (62%), education for underserved communities (53%) and protecting the environment (51%).
Giving Indies an Edge As a small or indie brand, you may be struggling with finding a way to make a philanthropic budget fit in with your launch plan, particularly if sales are still ramping up—but it’s an investment worth making. For starters, 88% of consumers believe that supporting a charitable cause gives small indie brands more visibility and credibility with the beauty consumer. In addition, 90% agree that, if deciding between a large and small brand (which both support a charitable cause, price and quality being equal), they would prefer to buy their products from the indie or artisan brand vs the well-known national brand.
Perhaps this is because women overwhelmingly (70%) agree that indie brands with a philanthropic mission are more committed to their cause than a big brand. Or perhaps it’s because women are just more interested in supporting a small, indie brand and their philanthropic mission than they are big brands— even if that well-known brand also has demonstrated its social consciousness through a social cause.
How Much is Enough? For all brands, whether large or small, established or indie, consumers are expecting a lot. Although consumers overwhelmingly believe brands are becoming more socially conscious, more than half (56%) feel brands should be doing even more to support philanthropic causes. And, because beauty brands are supported primarily by women, 27% of consumers feel these charitable causes should support women. After all, causes which benefit and help women overcome serious life issues, such as cancer, hunger or domestic abuse, strike a chord with women everywhere, and help them not just feel beautiful on the outside, but on the inside as well.
DENISE HERICH is co-founder and managing partner at The Benchmarking Company (www.benchmarkingcompany. com), which provides marketing and strategy professionals in the beauty and personal care industries with information about its customers and prospects through custom consumer research studies, focus groups, its annual PinkReport, and consumer beauty product testing for marketing claims.
Wink Natural Cosmetics’ “Buy One Give One for the Cure” campaign for breast cancer awareness donated a bottle to a cancer survivor for every bottle sold online and in stores.
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STARTUP INSIGHTS
So, You Want to Build Your Own Beauty Brand 5 questions to ask before you get started
| BY LISA KOVNER, Kovner Associates
∑ A beauty entrepreneur must have the ability to take calculated risks and to take advice offered by the experts they surround themselves with. ∑ Success will require a clear brand story that can be easily adopted and retold by third parties, such as beauty bloggers. ∑ Focus your thinking on what is possible and never use the past as a baseline for what can be achieved.
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Startup Insights
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ou’ve thought about it for years: owning your own brand. You know its market position, the product lineup, where you want to see it sold. It seems so easy, yet so many fail. There are many reasons why new brands fail, but the number one reason is a failure to understand the intangibles of brand building. The tactics are the “fun” part: the website, the e-blasts, the packaging and product development, but what’s your strategy? Have you evaluated the intangibles that can put you on the road to success? Ignoring these elements can crush you before your brand has a chance to make its mark. facebook.com/gcimagazine
Here are five questions to ask yourself about brand building before getting started.
1.
How courageous are you?
Estée Lauder once said “Risk-taking is the cornerstone of empires.” Be like Estée. Have the courage to take calculated risks. Building a brand from scratch takes guts. Your role as brand owner is to give your brand what it needs to survive and thrive. It means taking risks. You’ll second-guess yourself and stress over it, but if you have the courage to do it, your brand can be great. Understand the difference between calculated risks, gut instinct and reckless behavior. Sometimes you need to go with your gut, and this usually leads to a Global Cosmetic Industry
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calculated risk-taking, which is how you grow. Working outside your comfort zone leads to amazing things.
2.
Most owners of new brands are self-financing, which means they anguish over every decision.
How well do you play with others?
There will be a small army of people who help you succeed. They bring an expertise curated from years and years of experience. Everyone has a super power, but few people have several. To succeed, you need an army of people with a complimentary set of super powers to your own. Respect what they bring to the table. Listen to them—especially when they challenge your belief system. Don’t take it personally. Candid, tough discussions help you grow. Can you set aside what you want to believe is true and let experts help you identify what is actually true? Yes, you’re www.GCImagazine.com
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the brand owner and it’s your money, but if you have to be right all the time, you’re going to fail. Remember: no expert can help someone who can’t or won’t accept it.
3.
What are the opportunity costs?
By definition, an opportunity cost is the loss or gain of alternatives when one option is chosen. Opportunity cost is more than a change in options. It has a financial impact as well. Here’s an example:
Option 1: Your website expert has convinced you that building an e-commerce website on WordPress using Woo-Commerce is the right thing to do. It’s a solid recommendation. WordPress is free, it’s easy to update and it’s a flexible platform. What exactly could go wrong? A lot! WordPress, while free to install, comes at a high cost. How much will you spend on hosting, security and firewall protection, platform updates, plug-in and Startup Insights 35
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extension costs, optimization and so forth? According to Elegantthemes.com, it can cost between $500-$2,500 per month to maintain a WordPress site. Option 2: You go with a hosted platform such as Shopify or BigCommerce. You pay a flat monthly fee for the platform, which includes platform updates, hosting, security, reporting, basic marketing, transactional e-mails, a shopping cart, account pages, etc. There are apps you can add to enhance the site. Some will be free and some will come at a price. Are these platforms recommended for everyone? Absolutely not, but until you’re earning $250,000–500,000 a year at your website, hosted platforms are a viable option. What would it mean to your brand growth if you had a budget of $2,500 a month for marketing and sales? It means you can invest in revenue-generating activity, build a customer base and put your brand on a path to success.
4.
How do you make decisions?
Most owners of new brands are selffinancing, which means they anguish over every decision. Don’t fall victim to paralysis by analysis. Overthinking can kill productivity and creativity. When you have a minute, watch Daniel Gilbert’s TED Talk, “Why We Make Bad Decisions.”* It’s essential to understand how our brain is wired to assume what * https://www.ted.com/talks/dan_gilbert_ researches_happiness
Everyone has a super power, but few people have several. makes us happy, which can lead to poor decisions. For example: people tend to compare the present to the past, rather than to what’s possible. If the past is a major influence in your decision making, you’re not looking to the future. You’re de-valuing what’s possible, rather than creating a framework for what’s possible to become a reality. Here’s how you can facilitate the decision-making process: • Set clear objectives • Meet all deadlines • Talk it over with someone else • Make important decisions first thing in the morning
5.
How sharp are your storytelling skills?
In the olden days—like, 10 years ago—brands and retailers controlled the conversation. That’s not the case today. The customer controls the conversation— and that changes everything. Marketing guru Seth Godin once said, “Marketing is no longer about the stuff that you make, but about the stories you tell.” Be like Seth. Spend as much effort crafting the stories you will share as you do the products you make, and soon people will
ONLINE EXCLUSIVE: HOW TO BUILD A BEAUTY BRAND Throughout January, Lisa Kovner will be guest blogging about beauty brand building at GCIMagazine.com. Be sure you don’t miss a post by subscribing for free at www.gcimagazine.com/newsletter. Topics this month will include: • Successful Brand DNA • Business Plan Dos & Don’ts • Understanding Operations • Distribution 101
start telling the story for you. Here’s how you can craft a winning brand story: • Why do you exist? Answer this without any pronouns (I, you, he, she, they, it). • Why do you want to solve your customers’ problem? • How generous can you be with information that helps solve it? • Be interesting by giving something truly helpful and innovative. • Connect on an emotional level with your audience. Create two to four marketing personas you’ll target and tell your story in a way they can relate to. Speak to them in their language. • How connected is your story to your brand strategy? The two are inextricably linked, so if you think you don’t need strategy, then you should prepare an outcome that your brand story likely won’t sell. • How will your story be told by others? User-generated content (UGC) is the name of the game in social media. Accept that UCG will be shared more than virtually anything you create, which makes crafting your story from an outside point-of-view even more important.
5.1.
Can you honestly say that you’re ready to build a brand?
Please say yes, because it’s really an incredible experience. Look for Kovner in the March issue, where she’ll be discussing branding.
LISA KOVNER (lisa@kovnercompany.com) is the founder of Kovner & Company, which propels brands forward using influencer-based and non-traditional marketing strategies for consumer, retail and distribution channels.
36 Startup Insights Global Cosmetic Industry | January 2017
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CONSUMER INSIGHTS
Survey: How Millennials Purchase Makeup in the Digital Age
The power of influencers, the enduring appeal of brick-and-mortar shopping and the importance of tutorials.
NYFW attendees tried on virtual makeup looks from fashion designers by using the Perfect365 app.
| BY KRISTA MCAULAY, Beauty Squad Marketing Manager, Perfect365 ∑ Consumers research cosmetics online and trust digital influencers, but rely on physical trial to make the final purchasing decision. ∑ Virtual makeup try-on apps can help bridge the trends shared by vloggers or marketing from brands, allowing consumers to virtually try before they buy. ∑ Virtual try-ons allow consumers to feel more engaged with brands.
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t comes as no surprise that the net generation, commonly known as millennials, are shaking up the beauty industry in a major way—especially when it comes to decision-making and the purchasing process of cosmetics. Smart phones have become an extra appendage for this age group (roughly ages 18–35), and an important tool that provides entertainment, information and communication; for the beauty buyers, it acts as a portal that delivers everything they need to know about what lipstick to buy next.
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Try Before You Buy If you’re wondering why millennials would rather purchase in-store, even though they don’t trust the word of the sales person, look no further than the “try before you buy” phenomenon. Millennials build trust with beauty brands or particular products through online reviews, which could be sourced from YouTube beauty vloggers, Instagram stars or beauty bloggers. They can also build trust by trying the product on instore prior to making a purchase decision, particularly if they’re concerned with
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MILLENNIAL SHOPPING: BY THE NUMBERS
A recent study* of 175 female millennials conducted by beauty research company Poshly and commissioned by the Bay Area Beauty Association (BABA) and digital makeup app Perfect365, found several key insights for beauty brands:
SHOPPING HABITS • 94% of respondents buy makeup regularly • 65% of those women have purchased makeup using their smartphones • 72% of survey respondents preferred to purchase cosmetics within the brick-and-mortar stores—but they are already armed with knowledge about the products they came to purchase, and apparently aren’t swayed by a retail salesperson at the beauty counters**
(UN)TRUSTED INFLUENCERS • 7% of respondents claimed they trust recommendations given by a beauty salesperson • 15% trusted the recommendations given by a beauty consultant that they’d worked with in the past • 66% reported that they trust online entities’ (ex: YouTube beauty vloggers, social media influencers, etc.) recommendations
5
DIGITAL INSPIRATION • 67% are more likely to buy makeup if it comes with a tutorial for how to create popular looks • 80% want to see how makeup looks designed by their favorite YouTube/Instagram makeup artists or “beauty gurus” look like on them
DIGITAL TRIAL • 72% of respondents would like to try on makeup using their smartphone camera before they buy • 78% are more inclined to purchase a makeup product from a brand online if they could virtually see what it looks like on their face before purchasing • 85% are more inclined to try new hair products, hair styles or hair colors if they could first see what it looked like on their selfie https://explorer.perfect365.com/how-millennial-buy-makeup-report/ According to a Harris Poll survey of 2,223 U.S. adults online between September 19 and October 3, 2016, including 2,088 purchasers of cosmetic and grooming products, roughly 90% of consumers shop in person for hair styling products, shampoos and conditioners, cosmetics, non-sunscreen products with SPF protection, and sunscreen. Percentage of survey respondents who made online purchases were as follows: facial/skin care (34%), hair styling products (29%), hair color products and non-sunscreen SPF products (both 28%), sunscreen (22%), and shampoo and conditioner (17%).
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The digital ‘try-on’ age is here, and virtual makeup apps like Perfect365 can be found on over 80 million smartphones to date. Pictured here is a selection of Naked Cosmetics looks that app users can access on their phones.
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CONSUMER INSIGHTS
For beauty brands who are still testing the waters of the virtual world, digital makeup presents a unique opportunity to connect with millions of consumers and offer a virtual ‘try-on.’
texture, smell, taste or any other quality of a product. The most technologically advanced way to try on makeup is by using augmented reality through a digital makeup app. According to the Poshly survey (see sidebar), 78% of respondents said they are more inclined to purchase makeup from a brand online if they can virtually see what it looks like on their face before purchasing. This is huge for pure-play online brands that struggle to reach their audience. “For beauty brands, digital beauty is the next major wave that will create a dramatic shift in the beauty industry,” said Sinead NoreniusRaniere, board member, Bay Area Beauty Association (BABA). “For many brands, they are still trying to navigate how to embrace and adjust to this new generation of beauty buyers. For beauty brands who are still testing the waters of the virtual world, digital makeup presents a unique opportunity to connect with millions of consumers and offer a virtual ‘try-on.’” Even with the help of the virtual makeup application through apps and devices, there is still a need for tutorials, which can be delivered
66% of millennials surveyed reported that they trust online entities’ (ex: YouTube beauty vloggers, social media influencers, etc.) recommendations, compared to just 15% who were influenced by the recommendations of beauty consultants.
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through video, live streaming or step-bystep pictorials. A reported 67% of poll respondents said they’d be more likely to purchase makeup if it came with a tutorial on how to apply it. When it comes to hair products, hairstyles and color, 85% of respondents said they’d try something new if they could conduct a virtual tryon through a selfie or photo on their smartphones.
Supplementing the Influencers Chances are, you know someone who has purchased a beauty product that they heard about on YouTube—or maybe you are that person, who got sucked into buying a $100 foundation because you liked the way it looked on the vlogger. Makeup tutorials on YouTube are increasing 65% year-over-year, and are taking over beauty buyers’ smartphone screens all over the world, according to a study by Pixability**. www.pixability.com
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“Millennials are changing the game for the beauty industry,” said Doreen Bloch, CEO and founder at Poshly. “YouTube and Instagram beauty stars have taken over as their go-to experts on beauty. This is a dramatic shift from previous generations. These influencers provide the education on beauty they trust and serve as inspiration for experimenting with new beauty products.” However, what looks good on YouTube may not work for everyone. That’s where the virtual try-on goes hand-in-hand with the beauty guru’s suggestions. A reported 78% of the poll respondents said they would be more inclined to purchase a YouTube or Instagram guru’s recommendations if they were able to try them on virtually. Gaining the trust of the social media influencer community, and having the product accessible virtually in the palm of the millennial shopper, could be a big step in pushing businesses ahead in the digital living arena.
Engaging the Consumer Behind every beauty brand or Fashion Week show is a genius makeup artist that creates new looks season after season. Having the ability to virtually try-on innovative artist-inspired looks with a simple tap on a smartphone helps consumers feel included and special, and gives them the chance to create the looks at-home that are straight off of the runways. Virtual makeup is quick, easy, and very accessible for consumers of all ages— whether they’re using it to spiff up a selfie to post on social media, or to try out a new lipstick color from their favorite brand before they make the splurge to buy it. It brings brands closer to the consumer, helps create an interactive experience and takes the guesswork out of trying on a rainbow of lipsticks before the right shade is found. SUBSCRIBE TO OUR NEWSLETTER Sign up to receive daily news, insights and trends
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SKIN/SUN/ANTI-AGING
Mitigating Pollution Pollution defense has been one of the hottest claims of the last few years. Recently, Dr. Dennis Gross Skincare introduced C+ Collagen Perfect Skin Set & Refresh Mist, which works to set and refresh makeup, hydrate skin and provide a pollution shield to protect against environmental aggressors. Micellar technology delivers a boost of antioxidants, while collagen amino acids and energizing vitamin C hydrate and revive stressed skin without disrupting makeup. Meanwhile, ingredient firms are getting in on the act with new innovations. For instance, BASF recently presented an anti-pollution concept at the 2016 IFSCC Congress, which was developed to protect skin from pollution and environmental stressors and to fight damaging effects. The concept consisted of Purisoft (INCI: Moringa Oleifera Seed Extract (and) Maltodextrin); PatcH2O (INCI: Aqua (and) Glycerin (and) Trehalose (and) Urea (and) Serine (and) Pentylene Glycol (and) Glyceryl Polyacrylate (and) Algin (and) Caprylyl Glycol (and) Sodium Hyaluronate (and) Pullulan (and) Disodium Phosphate (and) Potassium Phosphate); Arganyl (INCI: Argania Spinosa Leaf Extract (and) Maltodextrin); and Eperuline (INCI: Maltodextrin (and) Eperua Falcata Bark Extract). In addition, DSM has launched Five Actives—Five Actions, a new concept built on science that determined how five of its leading actives can defend against urban dust and improve skin comfort, color, quality and perfection by increasing cell viability, reducing inflammation and reducing DNA damage. The concept comprises Alpaflor Edelweiss (INCI: Leontopodium Alpinum Extract); Pepha-Tight (INCI: Nannochloropsis Occulata Extract (and) Pullulan); Pepha-Protect (INCI: Citrullus Lanatus (Watermelon) Fruit Extract (and) Citrulline); Regu-Fade (INCI: Resveratrol); and Preregen.
Free Trend Webinar: Anti-pollution Cosmetics: The Science & Market, Mintel’s Sarah Jindal presents key insights into anti-pollution claims in the beauty market, including top product formats and the opportunities that lie ahead for the segment. For free access to the full trend presentation, visit www.gcimagazine.com/webcasts/.
Nivea Hand Care has retooled its formulas and packaging to maximize skin protection and improve product ergonomics. The creams are packaged in a bottle shaped like a pebble, which provides a soft feel and easy squeezability. The result is a package that has the functionality of a tube, but with improved performance. The range comprises a new Intensive Care Hand Cream with almond oil, as well as Smooth Care Hand Cream, Express Care Hand Cream, Anti-Age Care Hand Cream and Repair&Care Hand Cream.
The Microinfusion System by A.S.A.P.! uses 24K gold microchannel tips to pierce the skin to deliver serum to problem areas like acne scars, dark spots and fine lines. The beauty serum reportedly bypasses the skin’s top layer of dead skin cells and eliminates the need for an exfoliant, peel or dermabrasion.
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Peach & Lily has launched three sheet masks and will “curate special Korean beauty collections for many U.S. retailers, including Macy’s, Sephora, QVC, Anthropologie and Target.” The masks comprise cottonseed fiber-derived cellulose material that is reportedly “comfortable, breathable, lightweight and thin,” and allows for high ingredient absorption for ingredient delivery. The masks retail for $6, or $15 for a set of three, and include: Good Skin Day, which offers skin hydration, Reset Button, which soothes the skin, and Chubby Cheeks, which includes collagen-boosting firming ingredients.
Mirai Clinical’s 3-in-1 Multi-Tasking Face Serum is a toner, moisturizer and age-defying serum in a single application, which helps prevent the visible signs of aging from UV-rays and hormonal changes. Key ingredients: Astaxanthin, rice extract, silk protein, soy protein and green tea
Replenix’s Pure Hydration Moisture Balm combats dry skin and addresses visible signs of aging. Ingredient highlights: hyaluronic acid, yucca glauca root, glycerin, squalane, vitamin E, biomimetic ceramide complex, bisabolol, green tea polyphenols, caffeine USP and resveratrol.
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HiMirror has launched a WiFi-connected, 11” x 16.5”, humidity-resistant smart mirror that can offer personalized skin care analyses based on a user’s skin condition over time. It can also offer feedback based on weather conditions and other external factors. The steep price tag ($259) means that HiMirror won’t exactly become ubiquitous, but it portends the impact of the smart home movement on personal appearance and grooming.
Lipotec’s Cellynkage (INCI: Propanediol (and) Water (aqua) (and) Saccharide Isomerate) is a new marine ingredient that reportedly enhances direct communication between neighboring skin cells, as well as crosstalk between epidermal and dermal cells. The ingredient is appropriate for anti-aging creams, particularly for menopausal skin.
Givaudan Active Beauty has launched a sea-inspired Unisphere range, the Ocean Collection, which can deliver skin care ingredients. The Unispheres are available in White Shell, Pink Coral, Gold Treasure and Caviar.
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Softt Beauty Skin Care by Nicole Murphy’s Three-Piece Serum Set includes 20% Vitamin C Serum, Hyaluronic Acid Serum and 2.5% Advanced Retinol Serum.
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Perricone MD and Dermaflash have teamed up for a limited time to create the Ultimate Exfoliation & Treatment System, an at-home resurfacing device and age-defying regimen that aims to remove dead skin cells and built-up debris from the face (retail: $229). The ritual includes the Perricone MD Blue Plasma Cleansing Treatment and Perricone MD OVM treatment, which contains eggshell membrane, vitamin C ester and vitamin E to help increase hydration.
Dermarché Labs’ Roloxin Lift Gold: Instant Wrinkle Smoothing Mask with 24K Gold reportedly reduces the look of fine lines, pores and wrinkles while giving the user an instantly lifted look. Key ingredients include 24K gold and hydrophilic and hydrophobic silica particles.
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Evonik has launched a palette of ingredients to address stressrelated skin problems by helping to regenerate and revitalize the skin, improve its visual appearance and offering anti-oxidative protection. The range includes SK Influx and SK Influx V ceramide mixtures to restore the skin barrier; phytosphingosine to improve skin blemishes; TEGO Turmerone for defense against free radicals and oxidative stress ,and TEGO Cosmo C 100 to defend against further irritation.
Conture’s Kinetic Firm Neck Crème and Skin Toning Device fight sagging skin, drooping jowls and creases around the chin, neck and clavicle area due to repeatedly bending the neck to look at smartphone, tablet and computer screens throughout the day. Ingredient highlights: Renovage, Dynalift and Volufine.
L’Oréal Paris’ Skin Expert website allows women to match products to their skin care conditions, while the Library of Skin Care Ingredients offers education on about 200 materials. This year, L’Oréal Skin Expert/Paris will launch Hydra Genius Daily Liquid Care, lightweight products that contain aloe water and hyaluronic acid for 72-hour hydration, regardless of age or ethnicity. The range includes three formulas: Matte (oily skin), Glow (normal/dry skin) and Comfort (extra dry skin). Global Cosmetic Industry | January 2017
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Founder Stories: Building an Anti-aging Brand* HandMD, which was acquired by Synergy CHC in 2015, will introduce six new SKUs this year, all of which will retain founder Kara Harshbarger’s vision. Here, we provide a look at how the brand concept was developed and refined, as well as the lessons Harshbarger learned along the way.
1. Refine the Concept Kara Harshbarger, co-founder of HandMD knew that the beauty market was so saturated that it made little sense to launch a brand without a strong point of difference. As a result, she started her ideation process by considering the gaps in current beauty offerings. Harshbarger eventually came to understand that older women were often underserved in the beauty area. She also realized that, because hands are virtually never protected from the elements, they often looked older than women’s well-pampered faces. These two insights formed the genesis of HandMD. Harshbarger refined her concept by understanding that consumers want a product that makes their hands feel better immediately as they waited for the long-term antiaging effects to take hold (roughly six to eight weeks of consistent use) and finalized the brand vision around a basic problem/solution model that would perform well on a platform like QVC.
Kara Harshbarger, co-founder of HandMD.
2. Prove Value It’s difficult for consumers to get enthusiastic about a $50 hand cream, Harshbarger explained, so it was critical for HandMD to clearly position itself as anti-aging and to communicate its value and distinction to the public. Because consumers demand results, she chose not to build the products around a fad ingredient, like the latest antioxidant berry, and instead focused on quality trusted materials such as niacinamide. Finally, Harshbarger settled on a distinctive duo format—a serum, followed by a moisturizer—that could be layered together to work synergistically.
3. Get Expert-verified Harshbarger then approached dermatologist Dr. Alex Khadavi (co-founder of HandMD) with the concept and worked with a chemist to develop the products and conduct clinical testing. The result was the HandMD hero, the Restorative Duo (Reparative Serum + Anti-Oxidant Rich Moisturizer), which was later joined by the Daily Hand Renewal SPF 30+. Harshbarger then selected a brand name—HandMD— that easily and efficiently communicated what the products did and established its expert-backed positioning.
SUBSCRIBE TO GCI’s NEWSLETTER *Read an extended version of this story at www.gcimagazine.com/ business/marketers/positioning/
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for the latest news and launches. www.GCImagazine.com/newsletter
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HAIR The Plex Boom Global Hair Care Market by the Numbersa • $81.3 billion: market value in 2015 • $105.3 billion: market value by 2024 • 33.12%: Asia Pacific’s portion of market • 4.0%: Middle East and Africa market CAGR, the highest in the world • 40%: portion of market attributed to shampoo, the market’s largest segment www.transparencymarketresearch.com
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With gentle hair care all the rage, clarifying shampoos are proliferating across the market, including brands such as dpHUE Clarifying Shampoo, Christophe Robin Clarifying Shampoo with Camomile and Cornflower Progressive Lightening Treatment, and Madam C.J. Walker Beauty Culture Jamaican Black Castor & Murumuru Oils Pure Clarifying Shampoo with ACV. Now, Boudica has introduced a vegan Clarifying Shampoo for greasy, heavy hair, or hair that has been impacted by chlorinated pools.
By rebuilding hair bonds in a two-step system, Olaplex managed to bring some unique innovation to the professional hair treatment space. A 2015 Kline analysis estimated that the brand had perhaps tripled its revenue between 2014 and 2015 and that further growth was likely. Olaplex’s launch has also introduced competitors, such as Colorphlex (pictured), Brazilian Blowout Bond Builder, FibrePlex Bond Enforcing System and Bond Angel Plex Effect. (At press time, Olaplex is suing L’Oreal for Smartbond, its similar, though lower-priced, product.) Kline also highlighted the emergence of many sound-alike brands, including Beplex, Snaplex and Cureplex. It should be noted that these products are similar, but not identical, to Olaplex’s offerings. Now, Croda has unveiled its bond multiplier offering, Croda Plex, which “defends against coloring and bleaching damage and improves integrity of damaged hair after it’s been treated.” Citing Kline’s figures, Croda noted that plex product sales grew 525% between 2014 and 2015. Croda Plex uses heat-activated technology to build bonds, thereby boosting hair integrity within the cortex and protecting the cuticle during blow drying. The hair system is powered by the supplier’s Crodasone Cystine, which covalently bonds to hair to impart conditioning benefits; Keravis, which increases the hair’s tensile properties, bending modulus and cuticle abrasion; and Crodazosoft DBQ, which softens the hair and defends against cuticle abrasion, while also protecting artificial color.
Skinn Cosmetics’ Collagenesis Anti-Aging Rich Treatment Shampoo and Collagenesis AntiAging Hair & Scalp Treatment Conditioner contain acacia-derived collagen, amino acids and minerals, chamomile and acai oil extracts, rice protein, and coconut and argan oil. The range also includes a Collagenesis Scalp Revitalizer – Volumizing Treatment Serum, Collagensis Seal & Shine Cuticle Smoothing Spray and Collagenesis Scalp Revitalizer – Volumizing Treatment Serum (all retail for $24).
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( a e c r BCL Naturals Hair Care’s Intense Hydration range comprises lavender and an “avocado spa” scent and includes a shampoo, conditioner, Daily Miracle Mist (pictured) and Leave in Conditioning Cream (each retails for $11.99).
46 Hair Global Cosmetic Industry | January 2017
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Symrise’s KeraSym Shape is a cosmetic ingredient suited for all types of curly hair or chemically straightened hair. The formula consists of wheat bran extract, camellia oil and emollients combined to increase the breakage resistance of dry curly hair, smooth out frizz, tame volume and control curls.
Duffy’s Brew “Original Craft Beer Shampoo” has launched a new look and feel to the brand, as well as a reformulated shampoo and conditioner containing grains and botanicals.
Inside a Cowashing Startup** Brandon Schwartz (pictured) and Gil Dalva, cofounders of Unwash, the shampoo alternative hair care brand, had noticed that women’s hair care had become more natural and less augmented, signaling the decline of products such as gels, pomades and waxes. Brandon Schwartz, At the same time, hair oils, rinse-off cofounder of Unwash. products and leave-in products were on the rise, as were gentle skin care category cleansers such as micellar washes. In this context, women, sick of struggling with harsh shampoos, were looking for alternatives. Enter: Unwash. Channeling a common tech world guideline, Schwartz and Dalva avoided being all things to all people and instead focused solely on shampoo alternatives and the rise of “cowashing.” The pair began with a one-step hero product with no damaging effects or color draining. With a unique surfactant as Unwash’s point of difference, the simplicity of the brand proposition made it easy for consumers to understand.
Rapid Incubation, Lean Team Schwartz and Dalva brought the concept to Athena Cosmetics (of RevitaLash fame), which simultaneously hired the pair and acquired the brand. Athena, home to former P&G/Wella executives, acted as an incubator for Unwash, providing the cofounders with design, marketing, sales, legal and other resources required for a national launch. The Unwash team at Athena is lean, with a small group working to support the brand in various capacities—as Schwartz put it, “Everyone is involved in everything.” On any given day, the team manages anything from new product development to customer **Read an extended version of this article online at www.gcimagazine.com/ marketstrends/segments/hair www.GCImagazine.com
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With a unique surfactant as Unwash’s point of difference, the simplicity of the brand proposition made it easy for consumers to understand.
marketing and sales planning, including how they’re raising awareness for the brand and driving sales with their partners. The arrangement has allowed Schwartz and Dalva to work with the parent company’s resources almost like a freelance force, which freed them to focus on strategic and distribution opportunities and to quickly scale up the brand. In fact, Athena allowed Unwash the rare opportunity to quickly expand a small brand without any of the difficulties larger companies have in pivoting rapidly toward a trend. Last year, Unwash’s Bio-Cleansing Conditioner, Anti-Residue Cleanse, Hydrating Masque and Dry Cleanser debuted at Ulta Beauty. When the partnership was announced, Catherine O’Daniel, the retailer’s director of store sales and strategic planning, said, “Unwash products have quickly become a favorite among women and men seeking healthier hair with an alternative to the traditional daily wash and repeat.” The move to debut nationally made sense as the cowashing/ gentle hair cleansing category has already sprouted numerous competitors, including products like Renpure Coconut Mint Cowash Cleansing Conditioner, Shea Moisture Mongongo & Hemp Seed Oils High Porosity Moisture-Seal Co-Wash and dpHUE Apple Cider Vinegar Hair Rinse. Hair 47
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COSMETICS Nude by the Numbers* • 553%: U.S. online search frequency growth for “nude lipstick” in 2016 • 28/12: number of U.S. states and countries, respectively, in which “nude lipstick” was the top search • 267%: “matte lipstick” U.S. online search increase in 2016 *All data courtesy of Polyvore.com
Leading product searches in 2016 included Nars’ Orgasm Blush and Urban Decay’s Naked Palette, according to Polyvore.
Gorgeous Cosmetics has created the liquid Base Perfect Foundation (retail: $45) to help consumers achieve a “photo-ready finish.” The foundation works with dry, sensitive and oily skin and comes in 18 different skin color tones ranging from fair to deep.
Amorepacific is celebrating 10 years of K-beauty innovation by announcing that its cushion technology has surpassed the 100 million unit sales mark. The company sold 33 million units in 2015, alone. The iconic cushion compact format allowed for the easy application of hybrid formulas of foundation, sunscreen and skin care.
Kim Ramain-Colomb’s industrial design diploma project for Ecole cantonale d’art de Lausanne (ECAL), is a range of lipstick, blush and eye shadow prototypes inspired by traditional Berber lipstick, called Aker Fassi.** The designer sought to reinterpret this classic concept with a “modern context, and incorporating it into our everyday life,” she noted. Ramain-Colomb housed the natural makeup formulations (comprising rice powder, talc, shea butter, sesame oil, mineral oxides and silicates) in terracotta vessels developed with input from artisinal ceramist Peter Fink. Ramain-Colomb, who has received her diploma, is looking to develop the products and is actively seeking to connect with those in the beauty industry who might be willing to help her launch the range. Those interested in learning more about the project can contact the editor in chief at jallured@allured.com. **Read an extended version of this story at www.gcimagazine.com/marketstrends/segments/cosmetics/ReimaginingTraditional-Makeup-for-the-21st-Century-402302546.html 48 Cosmetics Global Cosmetic Industry | January 2017
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Scentbird has expanded to color cosmetics with Deck of Scarlet, a service that delivers a versatile palette of products to subscribers’ doors every other month for $29.95. A typical array comprises three eye colors, two cheek colors, two lip colors, an eye pencil and a lip pencil. The palettes are designed by social media influencers, including Kelly Strack, Sonjdra Deluxe and Evon Wahab, allowing consumers to recreate looks they find on YouTube and elsewhere. The palettes come with beauty tutorial videos with step-by-step instructions.
Morphe Cosmetics has produced single pots of eyeshadow, in addition to their traditional eyeshadow palettes. Morphe Pressed Pigments come in 30 different shades with more than 80% pure pigment (retail: $5.99).
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Note Cosmetics has introduced Sunglow Foundation and Ultra Rich Color Lipstick. The foundation ($11.95;), available in three shades, is formulated with ultra-fine, light-reflecting pearls that can create a natural, dewy, radiant complexion. The Ultra Rich Color Lipstick is available in 24 colors and features a light, aromatic and ultra creamy texture due to argan oil, cocoa butter and vitamin E.
No7’s Match Made Service offers 17 shade matches based on an analysis of 2,000 individual skin tones, which the brand believes allows women to perfectly pair makeup looks to their skin. The system, available at Walgreens, Target and some Ulta stores, will assist in the process of selection for foundation, lipstick, blush and concealer. The move, in line with a greater focus on inclusive multicultural product ranges, will be promoted by feminist novelist Chimamanda Ngozi Adichie, who said, “There is something exquisitely enjoyable about seeing yourself with a self-made new look. And for me that look is deeply personal ... It’s about what I like.”
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COSMETICS
Marc Jacobs Beauty has announced Kaia Gerber as the new face of the brand in the first official campaign images. The campaign will appear in print, outdoor and digital promotions for the prestige beauty brand. The new spring beauty collection will include the O!Mega Lash mascara in vibrant colors, Matte Highliner, and Le Mar Liquid Lip Crème. The products will be available at Sephora worldwide, select Marc Jacobs stores, Neiman Marcus, Bergdorf Goodman, Harrods, John Lewis and www.marcjacobsbeauty.com.
Sephora is betting beauty consumers will leverage chatbot tools and integrate them into their shopping routines. The retailer recently introduced Color Match for Sephora Virtual Artist, which facilitates shade matching of lipstick via a simple scan of a photo.
Merck KGaA’s Ronastar Red Allure (INCI: not available) is a matte burgundy-red, made up of titanium dioxide and iron oxide-coated silica, which can be used in various color cosmetics for both color and matte texture.
Kathleen Lights, who launched her beauty-focused YouTube channel three years ago, has introduced her first nail polish line, KL Polish. The range, which sells at the brand’s site for $8.50 each, includes shades such as Brick Sidewalk, Broccoli & Chocolate, Caramello (pictured), Gumption!, Snickerdoodle and Zoey.
YouCam has partnered with Latin celebrity makeup artist Roberto Ramos for a range of virtual looks created for the Latina consumer. YouCam Makeup users can shop the looks and purchase the products directly from the app.
50 Cosmetics Global Cosmetic Industry | January 2017
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BATH/BODY/FRAGRANCE/GROOMING
Loewe, one of the brands driving LVMH’s strong fragrance and beauty sales, features a customized ash wooden cap from Pujolasos on its latest scent, Loewe 001. The collection features a masculine and feminine scent and are available in 50 ml and 100 ml formats, as well as a 30 ml format for the feminine fragrance only. The luxury caps were customized in two colors that differentiated the feminine and masculine perfumes. The finish was achieved with a varnish process and then engraved on top with an anagram of Loewe using a laser high-definition lototip.
Black Leopard Skincare has produced a male grooming range and teamed up with Quadpack for its sleek, masculine, chunky matte-finish packaging. The brand also used Yonwoo’s airless technology, including its Jumbo and Jumbo Slim with tubes, a jar and a roll-on.
Provision, a new personal care and beauty range, offers a grounding, meditative approach to luxury. The line, designed with botanical ingredients, includes Las Flores eau de parfum (45 mL/1.5 fl oz.; SRP: $125 ), which contains orange flower absolute, elemi, poplar bud and a “Canyon Air Accord”; Resonance eau de parfum (45 mL/1.5 fl oz.; SRP: $125), featuring cork absolute, Spanish labdanum, olibanum and vanilla absolute; Maitri eau de parfum (45 mL/1.5 fl oz.; SRP: $125), which contains organic, eco-certified Madagascan vetiver, ginger absolute, “Mandarin Musk Accord,” oakmoss and Italian bergamot; Dream Extract (100 ml/3.4 fl oz; SRP: $55), a blend of organic, ecocertified clary sage and Italian bergamot, with musk and amber, and Australian-sourced Indian sandalwood; Connection Lip Rescue (15 g/0.5 oz; SRP: $55), an orange flower-scented balm containing avocado, shea butter, grape seed, sunflower seed, beeswax and rose wax; Manifest Body Oil (100 ml/3.4 fl oz; SRP: $75), which comprises shea butter extract, avocado oil, almond oil and amla oil, and is scented by labdanum absolute, vanilla absolute and patchouli; Purify Deodorant (50 ml/1.7 fl oz; $35) scented with eco-certified (NPA) French clary sage, Madagascan vetiver and oakmoss, and powered by a natural enzyme-containing DeoPlex from Carrubba; and Align Face Oil (30 ml/1.0 fl oz; SRP: $90), which contains amla oil (Indian gooseberry), anti-inflammatory and antibacterial Indian sandalwood, vitamin E-rich avocado oil and antioxidant sweet almond oil.
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Giorgio Beverly Hills Glam comprises notes of magnolia, cyclamen, peony, iris, jasmine sambac, heliotrope, labdanum, sandalwood and amber.
BladeButter has introduced ShaveJelly, a non-foaming, non-greasy product that is 90% organic and contains green tea and vitamin E to heal the skin. The brand also offers a RazorBooster micro lubricant, launched in 2012, which began as a forced-filtration oil for a protein bar wrapper challenge.
Unilever has expanded a proprietary formulation of Dry Spray with Anti-Marks Antiperspirant Technology across five brands in the United States: Degree Men, Degree Women, Dove, Dove Men+Care and AXE. The technology is designed to provide 48-hour odor and wetness protection while eliminating the yellow discoloration of clothing that can sometimes occur from a mixture of skin oil, sweat, laundering and the deodorant itself.
Batallure Beauty’s Robert Graham Blended Essence launch packaging by Metal Dynamics and Encore International (pictured) won Package of the Year and Fragrance Gold honors during the 2016 NJPEC Packaging of the Year awards. During the event, Norell Elixir by Norell Parfums New York won Student Choice Award and Fragrance Silver honors). Gold category winners included: Estee Lauder – Double Wear Cushion Stick by HCT Group, Viktor & Rolf Flowerbomb Sequin Shadow Box for L’Oreal USA by Millenium3, NARS – Steven Klein Collection by HCT Group for Graphics and Clinique Pep-Start for Clinique by Albea for Health & Beauty.
Diamond Packaging won three excellence awards at the 73rd annual Paperboard Packaging Competition The honored packaging included Elizabeth Arden’s John Varvatos Artisan Blu folding carton, which used a four color printing process and Clearwater Paper Candesce in order to provide the packaging with a sheer, glossy coat, as well as UV matte and UV gloss spotting to accentuate the water impressions imprinted throughout; L’Oreal USA’s Matrix Oil Wonders promotional packaging; and Diamond Packaging’s 2016 calendar.
52 Bath/Body/Fragrance/Grooming Global Cosmetic Industry | January 2017
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To celebrate the brand’s 20th anniversary, The Art of Shaving has released a collection of five fragrances: Sandalwood & Cypress, Oud Suede, Vetiver citron, Green Lavender, and Coriander & Cardamom.
Lubrizol’s Carbopol SMART polymers offer cleansing action with enhanced mildness and skin feel, as well as enhanced foaming properties. The range includes Carbopol SMART 1000 Polymer (INCI: Acrylates/Beheneth-25 Methacrylate/ HEMA Crosspolymer), which helps build stable hand, face and body cleansers using soap and soap-syndet combination systems; Carbopol SMART 2000 Polymer (INCI: Acrylates/Beheneth-25 Methacrylate/ HEMA Crosspolymer-2), which helps formulate a wide range of products such as body and hand cleansers and high-pH soap-based cleansers; and Carbopol SMART 3000 Polymer (INCI: Acrylates/Beheneth-25 Methacrylate/ HEMA Crosspolymer-2), which provides flexibility in formulations to deliver performance independent of formula pH.
SUBSCRIBE TO GCI’s NEWSLETTER for innovation and breaking news daily. www.GCImagazine.com/newsletter www.GCImagazine.com
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PRODUCTS and SERVICES
showcase
CONTRACT MANUFACTURING
PACKAGING
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54 Products and Services Showcase Global Cosmetic Industry | January 2017
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PRIVATE LABEL
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Kim Jednachowski kjednachowski@allured.com
1-630-344-6054
www.GCImagazine.com
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AD INDEX The Advertiser Index is provided as an additional service for readers to obtain information on companies and their products. The publisher assumes no liability for omissions or errors.
PAGE
ADVERTISER
PHONE
WEB SITE
Cover 3
Bioscreen Testing Services
1-310-214-0043
www.bioscreen.com
Cover 4
Centerchem, Inc.
1-203-822-9800
www.centerchem.com
53
Classic Cosmetics, Inc
1-818-773-9042
www.classiccosmetics.com
5
Coast Southwest, Inc.
1-714-524-2777
www.coastsouthwest.com
25
Italian Trade Agency/Cosmoprof Bologna
39-02-796-420
www.cosmoprof.com
33
MORRE-TEC Industries, Inc.
1-908-688-9009
www.morretec.com
41
Pilot Chemical Co.
1-513-326-0600
www.pilotchemical.com
29
Reed Exhibitions/in-cosmetics Europe
44-20-8271-2122
www.in-cosmetics.com
schĂźlke, Inc.
1-973-770-7300
www.schuelke.com
Spectra Colors Corp.
1-201-997-0606
www.spectracolors.com
Sun Deep Cosmetics, Inc.
1-800-985-2228
www.sundeepinc.com
3 23 Cover 2
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Ad Index
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Global Cosmetic Industry | January 2017
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THE INDUSTRY LEADER IN PATCH TESTING TEST WITH THE BEST! • FDA REGISTERED •
“THE FINE ART OF PERSONAL SERVICE”
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