Kline - USA Cosmetics and Toiletries Report 2013

Cosmetics&ToiletriesUSA
Introduction
SectionOne
Cosmetics&ToiletriesUSAContinuingService
INTRODUCTION
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COSMETICS&TOILETRIESUSA
ContinuingService
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Servingthe
COSMETICS&TOILETRIESINDUSTRY
throughconsultingservices:
Acquisitionassessments
Competitiveintelligence
Industry/category/brandanalyses
Newbusinessdevelopment
Profitability/financialanalyses
Strategicanalyses
4A4
TABLEOFCONTENTS
Page
1.INTRODUCTION................................................................................................................11
Contents........................................................................................................................12
Scope.............................................................................................................................12
Sourcesandmethods...................................................................................................13
ProductCategoryDescriptions..................................................................................15
Fragarances...................................................................................................................15
Haircareproducts.........................................................................................................16
Makeup.........................................................................................................................19
Oralcareproducts......................................................................................................111
Skincareproducts.......................................................................................................113
Othertoiletries............................................................................................................115
2.EXECUTIVESUMMARY......................................................................................................21
Personalcarethrivesoninnovationsinfusedwithbettertechnologies
andomnimediamarketingstrategies..........................................................................21
Retaillandscape..........................................................................................................212
Structureoftheindustry.............................................................................................219
Outlook.......................................................................................................................223
Appraisalandopportunityassessment......................................................................226
3.INDUSTRYANALYSIS
TheMarket...............................................................................................................31
Countryoverview..........................................................................................................31
Cosmeticsandtoiletriesoverallperformance..............................................................31
Growth..........................................................................................................................32
Unitvolume...................................................................................................................38
Retailvalueandtrademargins...................................................................................310
Companies..............................................................................................................313
Structureoftheindustry.............................................................................................313
Growth........................................................................................................................318
Companydevelopments.............................................................................................320
ConsumerResearch.................................................................................................327
Haircare......................................................................................................................327
Skincare......................................................................................................................332
Fragrances...................................................................................................................338
Oralcareproducts......................................................................................................340
Othertoiletries............................................................................................................341
TABLEOFCONTENTS
(Continued)
Page
3.INDUSTRYANALYSIS(Continued)
RetailDistribution...................................................................................................361
Outletdefinitions........................................................................................................361
Salesbyretailoutlet...................................................................................................363
PrivatelabelActivity...............................................................................................371
MarketingActivity...................................................................................................377
Traceablemediaexpenditures...................................................................................377
Promotions..................................................................................................................387
Outlook...................................................................................................................389
Growthtrends.............................................................................................................389
Basecase(mostlikely)unitanddollarforecaststo2017..........................................390
KlinesFutureViewScenarioForecastingModel
fortheU.S.CosmeticsandToiletriesMarket.........................................................397
Methodology...............................................................................................................397
Industrylevelfactors..................................................................................................397
Macroeconomicfactors..............................................................................................399
Overallcosmeticsandtoiletriesindustry...................................................................399
Fragrances.................................................................................................................3100
Haircareproducts.....................................................................................................3101
Makeupproducts......................................................................................................3101
Oralcareproducts....................................................................................................3102
Skincareproducts.....................................................................................................3103
Othertoiletries..........................................................................................................3103
4.PRODUCTS
4A.Introduction.............................................................................................................4A1
Reportcontents..........................................................................................................4A1
Restatedsalesestimates.............................................................................................4A2
Productcategorydescriptions....................................................................................4A3
Fragrances...................................................................................................................4A3
Haircareproducts.......................................................................................................4A4
Makeup.......................................................................................................................4A7
Oralcareproducts......................................................................................................4A9
Skincareproducts.....................................................................................................4A11
Othertoiletries..........................................................................................................4A13
4A2
TABLEOFCONTENTS
(Continued)
Page
4.PRODUCTS(Continued)
4B.TheMarket...............................................................................................................4B1
Totalsales...................................................................................................................4B1
Growth........................................................................................................................4B1
4C.Fragrances................................................................................................................4C1
Introduction................................................................................................................4C1
Manufacturerssales...................................................................................................4C1
Retailsales..................................................................................................................4C3
Competition................................................................................................................4C3
Retaildistribution.......................................................................................................4C4
Outlook.......................................................................................................................4C5
FragrancesforMen.................................................................................................4C9
Categoryperformance................................................................................................4C9
Categorydevelopment.............................................................................................4C15
Categorysegmentation.............................................................................................4C19
Competition..............................................................................................................4C19
Retaildistribution.....................................................................................................4C22
Marketingactivity.....................................................................................................4C23
Outlook.....................................................................................................................4C25
FragrancesforWomen..........................................................................................4C27
Categoryperformance..............................................................................................4C27
Categorydevelopment.............................................................................................4C34
Categorysegmentation.............................................................................................4C40
Competition..............................................................................................................4C41
Retaildistribution.....................................................................................................4C44
Marketingactivity.....................................................................................................4C45
Outlook.....................................................................................................................4C48
4D.HairCareProducts...................................................................................................4D1
Introduction................................................................................................................4D1
Manufacturerssales...................................................................................................4D1
Retailsales..................................................................................................................4D2
Competition................................................................................................................4D3
Retaildistribution.......................................................................................................4D6
Outlook.......................................................................................................................4D7
TABLEOFCONTENTS
(Continued)
Page
4D.HairCareProducts(Continued)
Conditioners..........................................................................................................4D11
Categoryperformance..............................................................................................4D11
Categorydevelopment.............................................................................................4D14
Categorysegmentation.............................................................................................4D18
Competition..............................................................................................................4D19
Retaildistribution.....................................................................................................4D22
Marketingactivity.....................................................................................................4D22
Outlook.....................................................................................................................4D24
EthnicHairCareProducts......................................................................................4D27
Competition..............................................................................................................4D35
Outlook.....................................................................................................................4D39
HairColoringProducts..........................................................................................4D41
Competition..............................................................................................................4D47
Outlook.....................................................................................................................4D51
HairStylingProductsandSprays...........................................................................4D55
Competition..............................................................................................................4D62
Outlook.....................................................................................................................4D66
4A4
TABLEOFCONTENTS
(Continued)
Page
4D.HairCareProducts(Continued)
Shampoos.............................................................................................................4D69
Competition..............................................................................................................4D77
Outlook.....................................................................................................................4D83
4E.Makeup....................................................................................................................4E1
Introduction................................................................................................................4E1
Manufacturerssales...................................................................................................4E1
Retailsales..................................................................................................................4E3
Competition................................................................................................................4E3
Retaildistribution.......................................................................................................4E7
Promotion...................................................................................................................4E8
Outlook.....................................................................................................................4E10
EyeMakeup..........................................................................................................4E13
Categoryperformance..............................................................................................4E13
Categorydevelopment.............................................................................................4E16
Categorysegmentation.............................................................................................4E19
Competition..............................................................................................................4E20
Retaildistribution.....................................................................................................4E22
Marketingactivity.....................................................................................................4E23
Outlook.....................................................................................................................4E25
FaceMakeup.........................................................................................................4E27
Categorysegmentation.............................................................................................4E32
Competition..............................................................................................................4E32
Outlook.....................................................................................................................4E38
TABLEOFCONTENTS
(Continued)
Page
4E.Makeup(Continued)
NailPolishes..........................................................................................................4E55
Competition..............................................................................................................4E59
Outlook.....................................................................................................................4E63
4F.OralCareProducts....................................................................................................4F1
Introduction................................................................................................................4F1
Manufacturerssales...................................................................................................4F1
Retailsales..................................................................................................................4F2
Competition................................................................................................................4F3
Retaildistribution.......................................................................................................4F5
Outlook.......................................................................................................................4F6
DentureProducts...................................................................................................4F11
Categoryperformance..............................................................................................4F11
Categorydevelopment.............................................................................................4F12
Categorysegmentation.............................................................................................4F14
Competition..............................................................................................................4F15
Retaildistribution.....................................................................................................4F17
Marketingactivity.....................................................................................................4F17
Outlook.....................................................................................................................4F18
LipBalms,Jellies,andTreatments..........................................................................4F21
Competition..............................................................................................................4F25
Outlook.....................................................................................................................4F29
4A6
TABLEOFCONTENTS
(Continued)
Page
4F.OralCareProducts(Continued)
Mouthwashes........................................................................................................4F31
Competition..............................................................................................................4F34
Outlook.....................................................................................................................4F37
Toothbrushes.........................................................................................................4F39
Competition..............................................................................................................4F43
Outlook.....................................................................................................................4F46
Toothpastes...........................................................................................................4F49
Competition..............................................................................................................4F55
Outlook.....................................................................................................................4F59
ToothWhiteningProducts.....................................................................................4F63
Competition..............................................................................................................4F66
Outlook.....................................................................................................................4F69
TABLEOFCONTENTS
(Continued)
Page
4G.SkinCareProducts...................................................................................................4G1
Introduction................................................................................................................4G1
Manufacturerssales...................................................................................................4G1
Retailsales..................................................................................................................4G3
Competition................................................................................................................4G3
Retaildistribution.......................................................................................................4G7
Outlook.......................................................................................................................4G7
BabyCareProducts...............................................................................................4G11
Categoryperformance..............................................................................................4G11
Categorydevelopment.............................................................................................4G13
Categorysegmentation.............................................................................................4G16
Competition..............................................................................................................4G18
Retaildistribution.....................................................................................................4G20
Marketingactivity.....................................................................................................4G20
Outlook.....................................................................................................................4G21
FacialTreatments..................................................................................................4G23
Competition..............................................................................................................4G37
Outlook.....................................................................................................................4G48
HandandBodyLotions.........................................................................................4G53
Competition..............................................................................................................4G60
Outlook.....................................................................................................................4G69
SkinCareProductsforMen...................................................................................4G73
Competition..............................................................................................................4G78
Outlook.....................................................................................................................4G82
4A8
TABLEOFCONTENTS
(Continued)
Page
4G.SkinCareProducts(Continued)
SunCareProducts.................................................................................................4G85
Competition..............................................................................................................4G99
Privatelabel...........................................................................................................4G103
Retaildistribution..................................................................................................4G103
Marketingactivity..................................................................................................4G104
Outlook..................................................................................................................4G107
4H.OtherToiletries........................................................................................................4H1
Introduction................................................................................................................4H1
ManufacturersSales..................................................................................................4H1
RetailSales..................................................................................................................4H3
Competition................................................................................................................4H3
RetailDistribution.......................................................................................................4H9
Outlook.......................................................................................................................4H9
DeodorantsandAntiperspirants...........................................................................4H13
Categoryperformance..............................................................................................4H13
Categorydevelopment.............................................................................................4H15
Categorysegmentation.............................................................................................4H19
Competition..............................................................................................................4H20
Retaildistribution.....................................................................................................4H24
Marketingactivity.....................................................................................................4H25
Outlook.....................................................................................................................4H28
Depilatories,Waxes,andBleaches........................................................................4H31
Competition..............................................................................................................4H37
Outlook.....................................................................................................................4H42
TABLEOFCONTENTS
(Continued)
Page
4H.OtherToiletries(Continued)
PersonalCleansingProducts.................................................................................4H45
Competition..............................................................................................................4H67
Outlook.....................................................................................................................4H74
ShavingProducts...................................................................................................4H77
Competition..............................................................................................................4H84
Outlook.....................................................................................................................4H89
5.MAJORCOMPANIES
Introduction..............................................................................................................51
Overview...................................................................................................................53
Totalsales.....................................................................................................................53
Growth..........................................................................................................................54
Alticor(Amway)........................................................................................................57
Companyoverview.......................................................................................................57
Corporatesalesandprofits...........................................................................................59
Cosmeticsandtoiletries..............................................................................................510
Recentdevelopments.................................................................................................511
Marketingactivity.......................................................................................................511
Outlook.......................................................................................................................512
Avon.......................................................................................................................515
Companyoverview.....................................................................................................518
Corporatesalesandprofits.........................................................................................518
Outlook.......................................................................................................................525
4A10
TABLEOFCONTENTS
(Continued)
Page
5.MAJORCOMPANIES(Continued)
Beiersdorf...................................................................................................................529
Outlook.......................................................................................................................537
Chanel.....................................................................................................................541
Outlook.......................................................................................................................546
Church&Dwight.....................................................................................................549
Outlook.......................................................................................................................555
Clarins.....................................................................................................................557
Outlook.......................................................................................................................562
TheCloroxCompany...............................................................................................565
Outlook.......................................................................................................................572
TABLEOFCONTENTS
(Continued)
Page
ColgatePalmolive...................................................................................................575
Outlook.......................................................................................................................583
Combe.....................................................................................................................587
Outlook.......................................................................................................................591
Coty........................................................................................................................593
Recentdevelopments...............................................................................................5101
Newproducts............................................................................................................5102
Marketingactivity.....................................................................................................5103
Outlook.....................................................................................................................5105
ElizabethArden.....................................................................................................5107
Companyoverview...................................................................................................5109
Corporatesalesandprofits.......................................................................................5110
Cosmeticsandtoiletries............................................................................................5111
Outlook.....................................................................................................................5114
EnergizerHoldings.................................................................................................5119
Outlook.....................................................................................................................5126
4A12
TABLEOFCONTENTS
(Continued)
Page
EsteLauder.........................................................................................................5129
Notablenewproducts..............................................................................................5141
Outlook.....................................................................................................................5149
GlaxoSmithKline....................................................................................................5155
Outlook.....................................................................................................................5162
GuthyRenker........................................................................................................5165
Outlook.....................................................................................................................5170
HelenofTroy........................................................................................................5173
Outlook.....................................................................................................................5180
Johnson&Johnson...............................................................................................5183
Outlook.....................................................................................................................5198
TABLEOFCONTENTS
(Continued)
Page
Kao........................................................................................................................5203
Outlook.....................................................................................................................5210
LimitedBrands......................................................................................................5213
Outlook.....................................................................................................................5223
LOral..................................................................................................................5227
Outlook.....................................................................................................................5252
LVMH....................................................................................................................5257
Outlook.....................................................................................................................5264
MaryKay...............................................................................................................5267
Outlook.....................................................................................................................5273
4A14
TABLEOFCONTENTS
(Continued)
Page
Merck....................................................................................................................5275
Outlook.....................................................................................................................5280
Procter&Gamble.................................................................................................5283
Outlook.....................................................................................................................5308
Revlon...................................................................................................................5313
Outlook.....................................................................................................................5321
Sanofi....................................................................................................................5325
Outlook.....................................................................................................................5330
Shiseido................................................................................................................5333
Newproducts............................................................................................................5339
Outlook.....................................................................................................................5340
TABLEOFCONTENTS
(Continued)
Page
Unilever................................................................................................................5345
Managementchanges..............................................................................................5355
Newproducts............................................................................................................5355
Outlook.....................................................................................................................5362
6.MINORCOMPANIES..........................................................................................................61
Abercrombie&Fitch.....................................................................................................65
AlsGroupe...................................................................................................................66
AllianceBoots................................................................................................................66
AmorepacificCorporation.............................................................................................68
AnthonyBrands............................................................................................................69
Arbonne......................................................................................................................610
AstralBrands...............................................................................................................611
AtlanticCoastMediaGroup........................................................................................612
AubreyOrganics..........................................................................................................612
BarcforMen...............................................................................................................613
Beauticontrol(TupperwareBrands)...........................................................................614
Beekman1802............................................................................................................615
Blistex..........................................................................................................................615
BlowPro......................................................................................................................616
BlueQ..........................................................................................................................617
BonneBell...................................................................................................................617
BradBiophotonic........................................................................................................618
ByTerry.......................................................................................................................619
CamilleBeckman.........................................................................................................619
CargoCosmetics..........................................................................................................620
CarmaLaboratories.....................................................................................................621
CarolsDaughter.........................................................................................................622
Cartier.........................................................................................................................622
CCAIndustries.............................................................................................................623
4A16
TABLEOFCONTENTS
(Continued)
Page
6.MINORCOMPANIES(Continued)
CellexCInternational.................................................................................................624
Chrysallis.....................................................................................................................625
TheColomerGroup.....................................................................................................625
CorSilverSkincare.......................................................................................................626
CosrichGroup.............................................................................................................627
DanaClassicFragrances..............................................................................................627
DeadSeaLaboratories................................................................................................628
DeborahLippmann.....................................................................................................629
DemeterFragranceLibrary.........................................................................................629
Dermalogica................................................................................................................630
DermovivaSkinEssentials...........................................................................................631
Devacurl......................................................................................................................632
Dr.BronnersMagicAllOne.......................................................................................632
Dr.Fresh......................................................................................................................633
Dr.HauschkaSkinCare...............................................................................................634
E.L.F.Cosmetics...........................................................................................................634
EquitiumGroup...........................................................................................................635
EOSProducts...............................................................................................................636
ErnoLaszlo..................................................................................................................637
E.T.Browne.................................................................................................................637
Euroitalia.....................................................................................................................638
ExpanscienceLaboratories.........................................................................................639
FaceStockholm...........................................................................................................640
FalicFashionGroup.....................................................................................................640
Focus21......................................................................................................................641
FreemanBeauty..........................................................................................................642
Fresh............................................................................................................................642
FruitoftheEarth.........................................................................................................643
FusionBrands..............................................................................................................644
GaldermaLaboratories...............................................................................................644
TheGap.......................................................................................................................645
GiovanniOrganicCosmetics.......................................................................................646
GoSmile......................................................................................................................646
GraceChoi...................................................................................................................647
HairRules....................................................................................................................648
TABLEOFCONTENTS
(Continued)
Page
HamptonSun..............................................................................................................648
HerbalifeInternational................................................................................................649
HermsInternationalGroup.......................................................................................649
HouseofCreed............................................................................................................650
InterfashionCosmetics...............................................................................................650
Interparfums...............................................................................................................651
InspiredBeautyBrands...............................................................................................652
IredaleMineralCosmetics..........................................................................................652
ITCosmetics................................................................................................................653
J.Strickland.................................................................................................................654
JafraCosmeticsInternational.....................................................................................655
J.M.Products...............................................................................................................655
JoeyNewYork.............................................................................................................656
JohnPaulMitchellSystems.........................................................................................656
JohnsonPublishingCompany.....................................................................................657
JonathanProduct........................................................................................................658
JosieMaranCosmetics................................................................................................659
JuiceBeauty................................................................................................................659
KissProducts...............................................................................................................660
KissMyFace................................................................................................................661
KosAmerica..............................................................................................................662
Laqa&Co....................................................................................................................663
LavanilaLaboratories..................................................................................................663
LOccitane....................................................................................................................664
LoracCosmetics..........................................................................................................665
LushFreshHandmadeCosmetics...............................................................................666
LusterProducts...........................................................................................................666
MarkwinsInternational..............................................................................................667
Matriskin.....................................................................................................................668
MerleNorman.............................................................................................................669
MissJessies................................................................................................................670
Murad..........................................................................................................................670
Naturopathica.............................................................................................................672
NewHarmonySoap....................................................................................................672
NotYourMother's......................................................................................................673
4A18
TABLEOFCONTENTS
(Continued)
Page
NuSkinEnterprises.....................................................................................................674
Nyx..............................................................................................................................674
Orlane..........................................................................................................................675
OrlyInternational........................................................................................................676
OsmiaOrganics...........................................................................................................677
Ouidad(JHPartners)...................................................................................................677
Palladio........................................................................................................................678
ParfumsDeCoeur.......................................................................................................678
PerioProducts.............................................................................................................679
PerriconeMD..............................................................................................................680
PierreFabreGroup.....................................................................................................681
PrestigeCosmetics......................................................................................................682
PrimalElements..........................................................................................................683
PrMinerals................................................................................................................683
Pure&Basic................................................................................................................684
Rahua..........................................................................................................................685
ReckittBenckiser.........................................................................................................685
RenCleanSkincare......................................................................................................686
RohtoPharmaceutical.................................................................................................687
RosebudPerfumeCompany.......................................................................................688
ShakleeCorporation...................................................................................................688
SisleyCosmetics..........................................................................................................689
SmellBent...................................................................................................................690
SteinerLeisure............................................................................................................690
SueIsmiel&Daughters...............................................................................................691
SundayRiley................................................................................................................692
Sunstar........................................................................................................................692
Tarte............................................................................................................................693
TatasNaturalAlchemy...............................................................................................693
TedGibson..................................................................................................................694
TooFacedCosmetics..................................................................................................695
UniversityMedical......................................................................................................695
Urth.............................................................................................................................696
ValeantPharmaceuticals............................................................................................697
VapourBeauty............................................................................................................698
TABLEOFCONTENTS
(Continued)
Page
TheVillageCompany..................................................................................................698
VincentLongo.............................................................................................................699
VogueInternational..................................................................................................6100
WeiEast....................................................................................................................6101
Weleda......................................................................................................................6101
YesTo........................................................................................................................6102
YvesRocher...............................................................................................................6103
7.ADVERTISING
Introduction....................................................................................................................71
Scope.............................................................................................................................71
Source...........................................................................................................................71
Format...........................................................................................................................71
TheProducts...................................................................................................................77
Introduction..................................................................................................................77
Babycareproducts.......................................................................................................77
Conditioners..................................................................................................................77
Dentureproducts..........................................................................................................78
Deodorantsandantiperspirants...................................................................................78
Depilatories,waxes,andbleaches................................................................................78
Ethnichaircareproducts..............................................................................................79
Eyemakeup...................................................................................................................79
Facemakeup.................................................................................................................79
Facialtreatments........................................................................................................710
Fragrancesformen.....................................................................................................710
Fragrancesforwomen................................................................................................710
Haircareproductsmultiproduct............................................................................711
Haircoloringproducts................................................................................................711
Hairstylingproductsandsprays.................................................................................711
Handandbodylotions................................................................................................712
Lipbalms,jellies,andtreatments...............................................................................712
Lipsticksandlipglosses...............................................................................................712
Mouthwashes.............................................................................................................713
Nailpolishes................................................................................................................713
4A20
TABLEOFCONTENTS
(Continued)
Page
7.ADVERTISING(Continued)
TheProducts(Continued)
Personalcleansingproducts.......................................................................................713
Shampoos....................................................................................................................714
Shavingproducts.........................................................................................................714
Skincareproductsformen.........................................................................................714
Suncareproducts.......................................................................................................715
Toothbrushes..............................................................................................................715
Toothpastes................................................................................................................715
Toothwhiteningproducts..........................................................................................716
Othercosmeticsandtoiletries....................................................................................716
MajorCompanies..........................................................................................................717
Introduction................................................................................................................717
Alticor..........................................................................................................................717
Avon............................................................................................................................717
Beiersdorf....................................................................................................................718
Chanel.........................................................................................................................718
Church&Dwight.........................................................................................................718
Clarins..........................................................................................................................719
ColgatePalmolive.......................................................................................................719
Combe.........................................................................................................................719
Coty.............................................................................................................................720
ElizabethArden...........................................................................................................720
EnergizerHoldings......................................................................................................720
EsteLauder................................................................................................................721
GlaxoSmithKline..........................................................................................................721
GuthyRenker..............................................................................................................721
HelenofTroy...............................................................................................................722
Henkel.........................................................................................................................722
Johnson&Johnson.....................................................................................................722
Kao..............................................................................................................................723
LimitedBrands............................................................................................................723
LOral.........................................................................................................................724
LVMH...........................................................................................................................724
MaryKay.....................................................................................................................724
Merck..........................................................................................................................725
TABLEOFCONTENTS
(Continued)
Page
7.ADVERTISING(Continued)
MajorCompanies(Continued)
Procter&Gamble.......................................................................................................725
Revlon.........................................................................................................................726
Sanofi..........................................................................................................................726
Shiseido.......................................................................................................................727
TheCloroxCompany...................................................................................................727
Unilever.......................................................................................................................728
4A22
INTRODUCTION
Cosmetics&ToiletriesUSAwithbaseyear2012isKline&Companysthirtyfirstannualstudy
ofthisindustry,precededbyperiodicreportsconductedsince1963.Thereportisbasedona
variety of information, with primary methods comprising more than 300 interviews with
industry executives from manufacturers and/or marketers, retailers and distributors, raw
material suppliers, trade associations, and government agencies, among other sources.
Informationobtainedfromtheseunstructuredinterviewsisthenassessedandanalyzedbyour
cosmeticsandtoiletriesconsultantswithavarietyofothersources,includingdatafromannual
reports, 10Ks, and other financial reports; trade literature; product literature and price lists;
andinformationfromstorevisits.
FullreportsubscriberstoCosmetics&ToiletriesUSAreceiveonedayofconsultationtimewith
their subscription to the study. The actual report is presented in five sections: Executive
Summary; Industry Analysis; The Products; Major Companies; and Advertising. The study
provides data and analysis, including market size and growth, brand and company shares,
trends,newproductactivity,traceablemediaexpenditures,andstrategicanalyses,inaddition
tootherinformation.
Cosmetics&ToiletriesUSAisoneofmanymulticlientreportsofferedbyKline&Companythat
coverthepersonalcareindustry.Otherselectedreportsandthoseunderconsiderationinclude:
BeautyRetailing
MulticulturalBeautyandGrooming
HomeFragrances
NaturalPersonalCare
PersonalCareCompetitorCostStructures
ProfessionalSkinCare
SalonHairCare
As an international consulting firm, Kline also conducts proprietary projects on an individual

client basis for leading cosmetic and toiletry marketers. Proprietary assignments include
acquisition analyses, new business assessments, strategic analyses, competitive intelligence,
andfinancialanalyses,amongothers.
WeinvitereadersofCosmetics&ToiletriesUSAtocontactuswithanyquestions,andtoadvise
usofanyomissionsorpossiblecorrections,whichwewilladdressimmediatelyorinthe2012
reportedition.
CarrieMellage
LenkaContreras
Director,ConsumerProductsPractice
VicePresident
KlineMarketResearch
KlineMarketResearch
9734353412
9734353407
Lenka.Contreras@klinegroup.com
12
Introduction
CONTENTS
The data contained in this report provide information on the entire U.S. cosmetics and
toiletriesindustrythroughconsumeroutletsforthecalendaryear2012.
Suchsectionsalsooccasionallycoverdevelopmentsfor2013.
The information in the report presents a comprehensive overview of the industry,
includingdataonproductsandcompanies,organizedforreadyreference,asfollows:
Executive Summary: This topline document highlights key activities and noteworthy
strategictrendsandissuesthatoccurin2012.
IndustryAnalysis:Thissectionanalyzestheprincipalfeaturesoftheoverallbusiness,its
products,companies,andpracticesin2012.
TheProducts:Thissectiongivesthoroughmarketprofilesof26productcategoriesof
theindustryfor2012.
Major Companies: Profiled here are the principal companies with U.S. cosmetic and
toiletry sales exceeding $99million, providing extensive business summaries of 30
majorsuppliersfor2012.
Minor Companies: Every other year this report publishes summaries of about 150
minorcompaniesintheindustry.This2012editiondoescontaintheminorprofiles
andtheywillbepublishedagaininthe2014edition.
Advertising: This section analyzes traceable media expenditures by category and
companyin2012.
Anoveralltableofcontentsisalsoincludedattheendofthissection.
SCOPE
Thisreportfocusessolelyonproductssoldthroughdomesticconsumeroutlets,including
thosemarketedviadirectsalesfromcompaniessuchasAvonandMaryKay,inadditionto
nontraditionaloutletssuchasspecialtyretailers.
Marketdatareferexclusivelytosalesthroughthesechannels.
Importandmailordersalesareincluded,butsalestoinstitutionssuchashospitalsand
nursinghomes,themilitary,andexportsareexcluded.Alsodutyfreestoressalesare
notincluded.
All market sales data are given in manufacturers or factory dollarsthat is, the prices
receivedbymanufacturersbeforewholesaleandretailmarkups.
All companies selling branded products are considered manufacturers in this report,
regardlessofwhethertheyhavemanufacturingfacilitiesoftheirownorsellproducts
madebyothercompanies.
Percentagetotalsoncertaintablesmaynotalwaysaddupduetorounding.
4A2
Introduction
SOURCESANDMETHODS
Data have been obtained through research and analysis of the industry conducted from
July2012throughJune2013.
The report information is obtained through over 300 interviews of executives in the
industry itself, retailers, raw material suppliers, trade associations, and government
agencies.
In addition to the interviews, the report includes an analysis of annual reports and
otherfinancialreportsfromcompanies,aswellasareviewoftrade,press,andother
secondaryinformation,andstorechecksofretailoutlets.
Alldataonmarketsizeandbrandshareshavebeendeterminedfromathoroughanalysisof
severalsourcesofinformation.
Statistics on market size are believed to be accurate for products with sales of
$15millionormore,probablywithin10%ofthetruevalue.
Forsmallermarkets,theaccuracyissubstantiallyless,probablywithin25%ofthetrue
value.
Dataonbrandsharesalsovaryaccordingtothesizeofthemarkets,althoughaccuracy
isroughlythesamefortheproducts.
The data presented in this report are believed to be sufficiently accurate for preliminary
marketplanning.
Morespecificanddetailedstudies,however,shouldbeconductedbeforeprojectsthat
requiresubstantialbusinessdecisionsareundertaken.
Kline& Company is pleased to assist clients on such projects through our custom
consultationcapabilities,realizedthroughover50yearsofexperienceconsultingtothe
cosmeticandtoiletryindustry.
Advertising expenditures are based on Kline& Companys analysis of ad spending data

sourcedprimarilyfromKantarMediaandPublishersInformationBureau,whocopyrightthis
service.
13
14
Introduction
4A4
Introduction
PRODUCTCATEGORYDESCRIPTIONS
FRAGRANCES
Fragrancesformen
Therearemanyformsofliquidfragranceproductsformen:
Eau de toilettes are diluted alcoholic solutions of perfumes, and eau de parfums
containfragrancesinmoreconcentratedforms.
Colognes contain more concentrated solutions of essential oils than aftershaves and
thereforeleavealongerlastingfragrance.Theyareusedtofreshentheskinandimpart
amasculinescent,frequentlyaftershavingorshowering.
Aftershaves, available in a variety of products, are lower in fragrance concentration
thancolognes.Aftershavesarebasicallyfragranceproductsthatalsosootheandheal
razornicksandconditionandinvigoratetheskinaftershaving.Productsareavailable
asliquids,lotions,andgels.
Ancillaryproductsareusuallyfeaturedaslineextensionsoftheliquidfragranceandinclude
fragrancedsoaps,deodorantsandantiperspirantsscentedwithabrandedmensfragrance,
fragrancedtalcumpowders,skincareproducts,andhaircareproducts.
ToiletryproductsfrommasstoiletrybrandssuchasOldSpice,GilletteSeries,andBrutare
notcoveredinthisanalysis.
Salesforliquidfragranceproductsforthesebrandsareincludedhere.
Bodysprays,suchasAxe,arenotincludedinthisanalysis.
Thesebrandsarecoveredinthedeodorantsandantiperspirantscategory.
Fragrancesforwomen
Womens fragrance products include perfumes, toilet waters, colognes, deocolognes, and
bodysplashes.
Perfumescontainfragrancesinrelativelyconcentratedforms.
Toiletwatersaredilutedalcoholicsolutionsofperfumes.
Colognes are similar to toilet waters but historically contain less fragrance; however,
many of todays colognes are concentrated and contain more perfume oil than toilet
watersdo.
Deocolognes are low in perfume concentration and are applied through an aerosol
spray.
Bodysplashesandmistsarethelowestinfragranceconcentration.
Solids are available in pressed powder or soft solid form and typically come in
compacts,pots,orsticks.
15
16
Introduction
Ancillaryproductssuchasdustingpowders,bodylotions,andbathadditives,whicharepart
ofafragranceline,arecoveredinthisprofileaswellasintheirrespectivecategoriesinthis
report.
Unisexfragrances,suchasCKOne,arecoveredinthiscategory.
HAIRCAREPRODUCTS
Allhaircareproductsalesreportedareforathomeuseonly.
Forprofessionaluse(backbarsales),refertoKlinesSalonHairCarereportseries.
Conditioners
Conditioners are used to moisturize and treat the hair and are generally available in a
varietyofformulasdesignedfornormal,dry,oily,andothertypesofhair.
Formulasmayalsobedesignedforhairtextureorendresult,suchascurly,straight,or
volumizing.
Morerecently,productsarebeingintroducedtoprovideotherbenefits,suchascolor
protectionorshineenhancement.
Mostconditionersareinstantproductsthatareappliedtothehairafterwashingandare
leftonthehairforonetothreeminutesbeforerinsing.
Alsoincludedaretherapeuticconditioners,whichareformulatedtoprovidemoreintensive
treatmenttothehair.
Suchproductsarealsooftencalledconditioningtreatmentsordeepconditioners.
Productsareoftenusedtotreathairthatisdamageproneorexcessivelydry.
Therapeutic or deep conditioning products are typically left on the hair for 5 to 20
minutesbeforerinsing.
Someproductsrequirenorinsing.
Somedeepconditioningproductsareavailableinsingleusepackets.
Inadditiontosalesgeneratedbymassbrands,ourcategorydefinitionandmarketsizedata
include:
SalonbrandssuchasMatrix(LOral);theseproductsderivethemajorityoftheirsales
from salons, although some volume is also generated from sales in mass outlets and
throughtheInternet.
Minor sales of conditioners also come from direct sales companies such as Avon,
prestigecompaniessuchasEsteLauder,andspecialtymarketerssuchasBath&Body
Works(LimitedBrands).
4A6
Introduction
Combination products that contain both shampoo and conditioner are included in the
shampooscategory.
Ethnichaircareproducts
Ethnic hair care products are specially designed to be effective for AfricanAmerican hair;
thefivemaintypesaredescribedbelow.
Relaxerkits(alsocalledperms)aredesignedtoremovecurlfromthehair,eithertotallyor
partially.
Styling aids serve a variety of functions and include products designed to counteract the
drynessproducedfromarelaxer.
Theseproductsholdthehairinplace,aswellaslubricatethescalp,preventdamage,
conditionandmoisturizethehair,andalloweasierstyling.
Suchproductsincludepressingaids,settinglotions,andhairtonics,aswellasspritzes,
gels,andmoussesthatarespeciallyformulatedforethnichair.
Dresses and lotions are typically petrolatumbased and are designed to add a wavy
appearancetothehairorholditinaparticularstyle.
Productsincludehairdressingconditioners,pomades,andtemporarywaveproducts.
Thissegmentincludesproductsspeciallyformulatedformensgrooming.
Curlmaintenanceproductsenhanceormaintainthecurlproducedbyacurlingproduct.
These products hold the hair in place as wellas lubricate the scalp, prevent damage,
andconditionandmoisturizethehair.
Such products include curl moisturizers, curl activators and restorers, combout
conditioners,curlmoisturizingsprays,andoilsheens.
Curl/wave kits are designed to add curl and body to the hair, help it set better and hold
longer.
Sales of other consumer products positioned specifically for ethnic consumers, such as
shampoos,conditioners,andhaircolorants,arealsoincludedinthiscategory.
17
18
Introduction
Haircoloringproducts
Haircoloringproductsaredesignedtocolorhair,eithertemporarilyorpermanently.There
arebasicallyfivetypesofhaircoloringproducts:
Permanentdyesprovidelongtermcolortohairandlastuntilnewhairgrowsout.
Semipermanent dyes highlight naturally colored hair or color gray hair without
bleachingaction.Theyaretypicallyappliedasshampooandremainonthehairthrough
severalwashings.
Permanentdemipermanentdyesprovideuptosixweeksofsheerhaircolortoblend
away gray hair without ammonia and without changing the natural color of the hair.
Productisleftinthehairforapproximatelyfiveminutes.
Special effects include lighteners, frosting products, and highlighting kits that are
usuallyappliedtoselectstrandsofhair.
Temporary colorants include rinses, shampoos, mousses, and gels that produce a
cosmetic change in the shade of hair and can be easily removed in one or more
shampoos.Theseproductsdonotpenetratethehairshaftandarenotasharmfulas
othercoloringproducts.
Hairstylingproductsandsprays
Thehairstylingproductscategorycoversavarietyofproductsforcontrollingandenhancing
theappearanceofbothmensandwomenshair,includingthefollowing:
Styling gels are used to style and hold hair in place. Gels are applied after hair is
washedandareleftonthehairwhileitisbeingsetorstyled.
Stylingmoussesperformthesamefunctionasgelsbutalsoprovidebodytothehair.
Productsareavailableasaerosolfoamsandareappliedtoeitherwetordryhair.
Spritzesandotherheavystylingspraysarehighlevelresinfixatives,typicallyappliedto
either wet or damp hair to aid in the styling or sculpting of the hair. Such products
produce greater hold and stiffness and generally result in a less natural look than
traditionalaerosolhairsprays.
Stylinglotionsarewaterorwater/alcoholliquid,gellikeformulasavailableinbottlesor
tubes. A glaze is a variety of lotion that usually imparts more shine and hold than a
lotion.
Hair volumizers and thickeners give hair volume and an overall thicker, fuller
appearance.
Treatmentsimprovethehairsoverallmanageability.Productusagenormallyrequires
anextrastepinadditiontoroutinecleansingandconditioningofhair.Usageofthese
products has proliferated recently to include generaltreatment products as well as
onesthataregearedtowardspecifichairtypes,suchasdamaged,fine,orcolortreated
hair.
Retexturizingproductsmakecoarseorfrizzyhairsmoothand,insomecases,straight.
Shine enhancers are mists or serums that add shine to hair. Many of these products
alsocontainsunprotectioningredients.
Mens grooming products help men maintain a certain hairstyle. These products are
typicallyformulatedastonicsandcreams.
Stylingproductsinotherforms,suchaspomades,putty,waxes,sticks,andpastes,are
also included in this category. These product forms generally provide control, shine,
andareusedfrequentlyfortexturedeffects.
4A8
Introduction
Hairspraysareusuallyappliedafterstylingthehairtohelpholditinplace.
Sprays are available in varying degrees of holding power, in scented or unscented
formulations,andinaerosolorpumpcontainers.
Shampoos
Shampoosareusedtocleansethehairandscalpandareavailableinavarietyofformulas.
Someshampoosaredesignedtoworkbestonnormal,dry,oroilyhair.
Others are developed for certain hair colors such as blonde, brunette or redhead, to
helpprotectandenhancecolor.
Antidandruffformulationshelpcontrolflakyscalp.
Someproductsmaycontainconditionersorshineagentsandmayalsobecalledtwo
inoneorthreeinoneproducts.
Childrensproductsareespeciallygentle.
MAKEUP
Eyemakeup
Eyemakeupconsistsofthefollowingproducts:
Eyeshadow,whichisusedontheeyelidorundertheeyebrowtogivetheappearance
of a shadow, is available in such forms of sticks, cakes, liquids, pencils, or brushons,
andinavarietyofcolorsandattributes.
Mascara is used on eyelashes to darken, color, and/or thicken. Mascaras that are
colorlessorsheertintedarealsoincluded.
Otherproductsincludeeyebrowproducts,whichareusedtodarkenandadddefinition
to eyebrows; eyeliners, which are used to line or darken the eyelid; and eye lining
pencils,whichareusedtoaddcoloraboveand/orbelowtheeyelid.
Productssuchasartificialeyelashes,tweezers,andotherimplementsarenotincluded.
Eyemakeupremoversarecoveredinthemiscellaneousproductscategory.
19
110
Introduction
Facemakeup
Facemakeupisappliedtothefacetocreatesmoothandpolishedlook.
Products covered in this section are makeup bases, face powders, blushers, and
concealers.
Makeup bases or foundations are applied to the face before other makeup products
such as powders and blushers. Twoinone products that can be applied dry like a
powder or wet like a base are also included in this category. Bases are available in
different textural finishes including lotions, creams, cakes, gels, aerosols, sticks, or
mousses, and in medicated or hypoallergenic formulations. Some products like
concealersmorethoroughlycoverskinimperfections.
Facepowdersareformulatedtolightlycoverthefaceorothermakeuptoimpartsubtle
color, provide an even appearance, and help control shine and oil. Products are
traditionallyavailableinpressedcakeorloosepowderforms.
Blushers are applied to the face to add color, usually after a concealer and makeup
base has been applied. Products are available in several forms, the most common of
whichisbrushonpowder.Otherformsincludecream,gel,liquid,stick,pencil,bronzer,
andmousse.
Coversticksandconcealersarealsoincludedinthiscategory.
Concealersformulatedtotreatskinrelatedproblemsarenotcoveredinthissection.
Lipsticksandlipglosses
Lipsticksandlipglossescolor,moisturize,addshine,protectthelips,andcanalsoalterthe
apparentshapeofthelips.
Lipsticks are soft solids that are most typically applied in stick form but are also
availableincompactsandlargepencils.
Lip glosses, which range from liquids to very soft solids, are sold in small jars, pots,
compacts,tubes,androlloncontainers.
Liplinersaretypicallyusedtooutlinethelipstogivethemgreaterdefinition.
Lipbalmsandjelliesareanalyzedseparatelyaspartoftheoralcareproductsclass.
Nailpolishes
Nailpolishesincludethreesubcategories:
Enamels, which gives color and gloss to the fingernails and strengthen them against
breaking.Productscomeinvariousshadesandcolors.
Basecoats,whichareapplieddirectlyonthenailbeforeenamel.Ridgefillersareatype
ofbasecoatthatisspeciallydesignedtoensurethatthenailsurfaceiscoatedevenly.
Topcoats,whichareappliedafterpolishing,tosealtheenamelandprovideprotection
againstchipping.
Multifunctionalproductswhichincorporatealloftheabovebenefitsarealsoincluded.
4A10
Introduction
Topcoatsandbasecoatsmaybeusedalonebutaremorecommonlyusedinadditiontonail
enamel.
Some clear coats are positioned as threeinone coats for use before and after nail
polish,orevenalone.
Nail hardeners are products specifically formulated to provide added durability. Nail
hardenersthatcontaincolorandthosethatarepositionedasbasecoatsareincludedinthe
nailpolishescategory.
Thiscategorydoesnotincludeartificialnails,nailtreatments,nailpolishremovers,orany
nailcareimplements.
ORALCAREPRODUCTS
Dentureproducts
Cleansers are available in tablet, cream, gel, powder, and crystal forms and are used to
removefoodanddebrisfromdentures.
Adhesivesareavailableascreams,powders,liquids,andstripsandaredesignedtosecure
denturesinplace.
Denturelinersandcushionsarenotincludedaspartofthisanalysis.
Lipbalms,jellies,andtreatments
Lipbalmsprotectthelipsagainstchappingduringcoldweatheranddryinginwarmweather.
Products are available in natural, fruit, and other flavors, and with such benefits as
sunscreenandaddedvitamins.
LipbalmsmarketedbysuchsuncarebrandsasBananaBoatrepresentminorsalesand
areincludedintheSunCareProductssectionofthisreport.
Lip balm brands that contain SPF such as ChapStick and Blistex are included in this
category.
Lipjelliesalsopreventchappinganddryingandaresimplyamoreconvenientlypackaged
methodofapplyingpetroleumjellytothelips.
Traditionalpetroleumjelly,whichisnotspecificallypackagedasalipcareproduct,is
not included in this category but is profiled in the miscellaneous products section of
thisreport.
111
112
Introduction
Liptreatmentsconditionlips,smoothmouthlines,controlslipsticksmudgingandbleeding,
andgivelipsafullerappearance.Thisincludeslipplumpers.
Lip balm products that are marketed exclusively as ultratherapeutic products, such as
CamphoPhenique,Herpecin,andTanac,arenotcoveredinthisreportbutarediscussedin
NonprescriptionDrugsUSA.
Products where color is the primary benefit are covered in the lipsticks and lip glosses
categoryofthisreport.
Mouthwashes
Mouthwashes,gargles,andrinsesareliquidproductsthatareusedtocleansethemouth,
fortifyteeth,andfreshenbreath.
In some cases, mouthwashes are also used to help treat or prevent sore throats and
coldsaswellascavities,plaque,andgumdisorders.
Mouthwashes, gargles, and rinses are generally positioned as breathfreshening,
antibacterial,orantiplaque,andsomearealsofluoridetreatments.
Breathfreshenerssuchassprays,arenotcoveredinthisreport.
Toothbrushes
Toothbrushesareusedtoapplytoothpastes,gels,anddentalcreamsforcleaning,polishing,
andwhiteningteeth,aswellascleansingthemouth.
Toothbrushescomeinavarietyofshapes,sizes,anddesigns.
Thecategory,however,isbroadlyclassifiedintotwosegments:childrenandadults.
Thechildrenssegmentcoverstoothbrushesdesignedforyouth,children,andtoddlers.
Thisreportincludesmanualandbatterypoweredbrushes.
Electrictoothbrushesarenotcoveredinthisreport.
Toothpastes
Toothpastesareusedtoclean,polish,andwhitentheteeth,aswellascleansethemouth,
sweetenthebreath,andreduceincidenceoftoothdecayandgumproblems.
Products are available primarily as pastes and gels, but are also sold as powders and
liquiddrops.
Toothwhiteningproducts
Toothwhiteningproductsareappliedtotheteethtoobtainalightershade.
Products are available primarily as whitening strips, brushon gels, and moldable
mouthpiecesortrays.
Thisreportcoversproductsforathomeuseonly.
4A12
Introduction
SKINCAREPRODUCTS
Babycareproducts
Babycareproductsaredesignedtosoothe,protect,andhealthetenderskinofinfantsand
youngchildren,particularlyskinthatisirritatedfromdiaperrashandchafing.
Thissegmentincludesbabybath,lotions,oils,andpowders.Excludedarebabyshampoos
anddiaperrashcreams.
Theseproductsarealsooftenusedbyadultsasbathoils,skinmoisturizers,skinsoothers,
andforeyemakeupremoval.
Facialtreatments
Facialtreatmentsperformvariousfunctionsand,whilesomeoverlapexists,mostproducts
aregroupedintooneofthefollowingsegments:
Moisturizers and treatments keep skin soft, firm, smooth, and often claim to protect
skin and reduce signs of aging. Such treatments as eye creams, serums, and acne
productsarealsoincludedhere.
Thecleanserssegmentconsistsofcleansers,masques,porestrips,andfacialcleansing
cloths.Cleansingcreams,lotions,gels,andbarscleansetheskinandremovemakeup.
Masquesaredesignedtocleanse,firm,purify,ormoisturizethefacebyexfoliatingskin,
absorbing oil, or providing moisturizing benefits, and are typically worn for several
minutes or overnight. Pore strips are designed to cleanse clogged pores and remove
blackheads by applying and removing a bandagelike strip. Facial cleansing cloths,
wipes, and towelettes are designed to cleanse the skin and remove makeup with or
withouttheuseofwater.
Acneaidsarecreamsandlotionsforcontrolofmildinfections,orotherskinblemishes.
Astringentsandtonersstimulatetheskin,helpremoveexcessoil,andcanalsoreduce
appearanceofporesize.
Makeupremoversarenowincludedasfacialtreatmentsinthisreport,whereasin2010
editionandpreviouslyitwasinmiscellaneousproducts.
Oilblottersandfacialtissuesthatdonotcontainacleansingagentarenotincludedinthis
report.
Handandbodylotions
Handandbodycreams,lotions,andtreatmentsaredesignedtopreservethenaturalbeauty,
youthfulfeel,andappearanceofskinandtoprotectagainstenvironmentalharm.
113
114
Introduction
Productsareformulatedtosmoothandlubricate,moisturize,sootheandpreventdryness,
relievechapping,protectagainstexternaldamage,andsometimesexfoliate.
Included are such specialty body treatments as skinfirming products, body masques, and
relatedproducts.
Fragrancelineextensionsofbodylotionsarealsoincluded.
Footcareproductsincludesmoothinglotionsandcreams,deodorizers,powders,exfoliating
scrubs,andwashesarealsoincluded.
Athletes foot products, fungicidal products, and corn and callus removers are not
included in this report but are discussed in Klines companion report Nonprescription
DrugsUSA.
Specialtyfootinsertsarealsoexcludedfromthisreport.
Skincareproductsformen
Skin care products for men include moisturizers, night creams, antiaging products, facial
and body cleansers, hand and body lotions, replenishing eye creams, exfoliating scrubs,
facialmasques,andaftersportstreatmentsmarketedspecificallytomen.
Thefollowingproductsarenotincludedinthiscategorybutarereportedintheirrespective
sectionsofthisreport:shavingcreamsandgels,personalcleansingproducts,deodorants,
andaftershaves.
Although men often use allpurpose or womens skin care products, such usage is not
includedhere.
Suncareproducts
Fivetypesofsuncareproductsareincludedhere,manyofwhichareavailableascreams,
gels,foams,lotions,oils,sprays,andsticks:
SuntanningproductswithSPF5andunder,whichpromotetanningoftheskinunder
sunlight.
Sunscreens with SPF6 to SPF14 and sunblocks with SPF15 and over, which can
eliminateupto99%ofthesunsultraviolet(UV)radiationandthuspreventburningor
prolongtanning.
Sunless tanning products, which represent two types of products: products that tan
withoutexposingtheskintothesun,andproductsthatalsocontainsunscreen.
Aftersun products, which often contain aloe vera and are designed to soothe and
moisturize sun exposed skin. Lip balms marketed by such sun care brands as Banana
Boat are included in the aftersun and other products segment of this category. Lip
balmbrandslikeChapStickandBlistexthatcontainSPFarereportedintheLipBalms,
Jellies,andtreatmentsproductcategory.
4A14
Introduction
SPFisthestandardmeasurementofasunscreenscapacitytoprotectagainstUVrays.
TheSPFnumberreferstotheeffectivenessofsuncarepreparationsinprotectingthe
skinfromtheharmfuleffectsofthesunsUVradiation.
ThewavelengthsoftheUVraysemittedbythesunlongalpha(UVA)raysandshort
beta(UVB)raysaffecttheskindifferently.
Facialmoisturizers,bodymoisturizers,makeup,andotherproductsthatareratedwithan
SPF but for which sun protection is considered a secondary benefit are included in their
respectiveproductcategorieswithinthisstudy.
OTHERTOILETRIES
Deodorantsandantiperspirants
Antiperspirantsaredesignedtoeitherinhibitorstoptheflowofperspirationandmayalso
preventodor.
Deodorantssuppressbacterialdecompositionthatcausesodor.
Deodorantsandantiperspirantsareofferedinmanyproductforms.
Solid sticks have an antiperspirant active powder suspended in a wax matrix and are
twistedupandappliedonusersskin;therearetwomaintypesofsolidsticks.Regular
solidsticksweretheoriginalsolidstickintroduced.Invisiblesolidsticksorsheersolids
aresolidstickswithasofterfeel.
Softsolidextrudablesextrudecreamysolidthroughmeshdome.
Gelsareeitherclearoropaqueandusuallyassociatedwithwetandcooling,butalsoa
morestickyandslipperyfeel.
Rollons are one of the original modern forms of antiperspirant delivery; aqueous
solutionsarerolloutontousersskinviaarollingball.
Aerosolsaresprayedontousersunderarmorotherareasofthebody.
Depilatories,waxes,andbleaches
Depilatoriesaredesignedtoremoveunwantedhairandareanalternativetoshaving.
Most depilatories contain an alkaline chemical that causes the hair shaft to separate
fromtheskinsothehaircanbewipedaway.
Theseproductsareofferedingels,creams,lotions,rollons,mousses,andaerosols.
Theseproductsareeffectiveforaboutsevendays.
115
116
Introduction
Waxesareappliedtounwantedhairandpeeledoff,removinghairdowntotheroot,not
justattheskinssurface.
Theseproductsareavailableinhotandcoldvarieties.
Someofthenewerwaxescontainsugar,whichissaidtohelptheremovalprocess.
Typically,theseproductsareeffectiveforthreetoeightweeksbeforeregrowthoccurs.
Bleachesareproductsthatfadehairratherthanremoveit.
Theseproductsaremostcommonlyusedinthefacialarea.
Theseproductsaretypicallyeffectivefortwotothreeweeks.
Not included in category sales are buffer products or epilettes, which are a more
mechanicalmeansofhairremoval/sloughing.
Otherminorproductformsarealsoavailable,suchaspaste,rockorcrystal,andwipe
ontowellettes.
Alsoexcludedareprofessionaluseproducts.
Personalcleansingproducts
Personalcleansingproductsaredividedintosixproducttypes:
Bar soaps include traditional commodity soaps such as deodorant, moisturing, and
complexion soaps as well as specialty soaps such as highly fragranced and novelty
soaps.
Bodywashesaretypicallyforuseovertheentirebodyandareusedexclusivelyinthe
shower,inplaceofbarsoaps.
Pricepointsarehigherthancommoditybar,liquid,andsomelowerpricedspecialtysoaps.
Thissegmentdoesnotincludebathandshowergels;suchproductsarecoveredintheBath
Additivessegmentofthisreport.
Liquid soaps are usually available in pump packaging and often contain moisturizing
andconditioningagents.
Mostmanufacturersofferrefills.
Mechanicshandsoapsorwaterlesshandcleanersareexcludedfromthecategory.
4A16
Introduction
Liquid gels for use over the entire body, in the bath or shower, are covered in the Bath
Additivessectionofthisreport.
Antibacterialhandgelsorhandsanitizersaredesignedtofightoffgermsonthehands
withoutsoap,water,ortowelsinapproximately15seconds.
Most contain a bitter agent that has been added to discourage ingestion by pets or
children.
Bathadditivestypicallyofferthefollowingbenefits:
Softenwaterforgentleskincare.
Moisturize,sootheandsmoothskin.
Impartfragrancetowaterandapleasantatmospherearoundthebath.
Offertargetedaromachology/aromatherapeuticbenefits,suchasstressreduction.
Productsareofferedinthefollowingforms:
Bath liquids, grains, cream baths, cubes, salts, crystals, tablets, sachets, and mousses
areformulatedtoeithercreatefoamunderrunningbathwaterordissolveinthebath
tosoftenandperfumethewater.
Productsaretypicallysegmentedtoappealtoadults,teens,orchildren.
Bath and shower oils and gels are an extension of bubble baths, offering a high
moisturizingbenefitandleavingskinfeelingsoftandsmooth.
Fragrancebathadditivesaregenerallyincludedinpopularfragrancelines.
The bath additives section covers adult and childrens bath additives. Infant bath
additivesarediscussedseparatelyinthebabycarecategoryofthisreport.
Shavingproducts
Shavingproductsincludeshavingcreamsandsoapsandpreshavelotions.
Shaving creams and soaps, available in scented and unscented forms, are used to
softenthebeardbeforeshavingwitharazor.
Aerosol types, including foams and gels, are by far the most popular, but some
brushlessshavingproducts,lathercreams,andsoapsarestillsold.
Preshavelotionsareusedtocoatthebeardandlubricatetheskinbeforeshaving.
Razorsareexcluded.
117
118
Introduction
4A18
ExecutiveSummary
SectionTwo
EXECUTIVESUMMARY
SectionTwoof
ContinuingService
CARRIEMELLAGE
KlineMarketResearch
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SPECIALNOTICE


company.

thesubscriber.
Kline&Company,Inc.
Servingthe
Strategicanalyses
4A4
TABLEOFCONTENTS
Page
EXECUTIVESUMMARY..........................................................................................................21
Personalcarethrivesoninnovationsinfusedwithbettertechnologies
andomnimediamarketingstrategies.............................................................................21
Retaillandscape.............................................................................................................212
Structureoftheindustry................................................................................................219
Outlook..........................................................................................................................223
Appraisalandopportunityassessment.........................................................................226
4A2
EXECUTIVESUMMARY
PERSONALCARETHRIVESONINNOVATIONSINFUSEDWITHBETTERTECHNOLOGIES
ANDOMNIMEDIAMARKETINGSTRATEGIES
Improving economy supported by several innovative product launches, an increase in

traceable media expenditures (TME) and promotional activities, and moderatetoheavy
acquisition activity support the overall growth of the cosmetics and toiletries market in
2012.
Manufacturerssalesofcosmeticsandtoiletriesgrow3.4%to$40.4billionin2012.
Other factors attributing to the growth of the cosmetics and toiletries market in the
United States include marketers introducing products with better technologies, rising
consumer confidence with the recovering economy, an increase in promotional
activities,andacontinualshifttowardsnaturalproducts.
Consumerssplurgeonproductsthatcanhelpthemlookbetter,stayyoungerlooking,
andofferspecificbenefitssuitingtheirneeds.
Additionally,manyofthecategoriesthatareshowingsubstantialgrowthsuchasfacial
treatments are growing because of products marketed as a way to stave off or
eliminatemedicalprocedureslikeinjectionsandcosmeticsurgery.
Since2007,saleshavegrownatacompoundannualgrowthrate(CAGR)of2.1%.
Figure21:ManufacturersSalesintheU.S.CosmeticsandToiletriesIndustry,2007to2012
$Billion
45
39.0
40
36.4
36.6
36.3
2007
2008
2009
40.4
37.3
35
30
25
20
15
10
5
0
2010
2011
2012
22
ExecutiveSummary
Consumers continue to spend on products that claim to provide multiple benefits and
professionallikeresultsin2012.
Consumers are spending on valueadded cosmetics and toiletries products, especially
onproductswhichoffermultiplebenefitsandmeettheirspecificrequirements.
However,atrendobservedisthatsomeconsumerritualsinvolvemoreproducts,such
asserums.
Consumersoptforproductsofferingprofessionalresultsathome,especiallyinproduct
classes,suchasskincareandhaircare.
Mass marketers continue to bridge the gaps within luxury products by introducing
masstige products with technological advancements and multiple benefits, but the
luxurytradeclassgrowsthefastest,followedbyspecialty.
The frequency at which women consumers visit salons is increasing compared to the
previousfewyears,supportingthegrowthofprofessionalhaircareproducts.
Recoveringeconomyaidssalesofthecosmeticsandtoiletriesmarketin2012.
Consumers are open to spending more, yet conservatively, on products that are
technicallyadvanced,offermultibenefits,andprovidevaluefortheirmoney.
Theluxuryconsumersreturnstronglyin2012,tradingbackuptoluxuryproductsfrom
massbrands,andshoppingindepartmentstoresmorefrequently.
Thespecialtystoreschannelperformswellin2012,supportedbyincreasingsalesfrom
vertically integrated retailers such as Bath & Body Works and Victorias Secret, along
withgrowthfromcosmeticspecialtystores,suchasSephoraandUlta.
Mostmarketersincreasetheiradvertisingbudgetin2012tosupporttheirbrands.
Newproductlaunchesareaggressivelysupportedbymediaexpenditures.
Total TME spending on the cosmetics and toiletries market for 2012 increases by
approximately16%.
MarketersspendingthehighestTMEin2012areL'Oral,Procter&Gamble,Unilever,
andEsteLauder.
Thetopfivemarketersspendapproximately66%ofthetotalTMEspendin2012.
FacialtreatmentscategoryreceivesthehighestTMEof$1.3billionin2012,followedby
shampooswithaTMEof$446million.
4A2
23
ExecutiveSummary
Socialmediacontinuestogainprominenceincommunicatingcloselywithconsumers,and
social media sites such as Facebook, Twitter, Tumblr, Pinterest, and YouTube are used by
mostmarketerstoestablishaconnectionwithconsumers,especiallytheyoungeraudience.
The marketers prominently provide information on new product launches and other
product offers on their respective social media pages. For example, Maybellines
Facebookpageoffersbeautytipstoitssubscribersinordertokeepthemupdatedwith
thelatesttrendsandlaunchesunderthebrand.
PresenceonthesocialnetworkingwebsitessuchasFacebookbecomesaneconomical
meanstostayintouchwithexistingandpotentialcustomers.
In 2012, Maybelline celebrates 1 million fans for its Facebook page, Sensational
Maybelline.
YouTube is considered a powerful marketing tool due to its ability to captivate the
consumers attention through videos, which are more appealing than static pictures
and words. Videos that manage to go viral, inspiring multiple forwards from
consumerstotheirfriends,drumupsignificantpublicityforbrands.Increasingly,most
leadingbrandshavetheirindividualYouTubechanneltoconnectwiththeirconsumers.
Overall,socialmediaisusedasatooltoadvertisenewproductactivity,sharefeedback,
establishapersonalconnectionwithconsumers,andgatherinstantconsumeropinion
aboutproductofferings.
Figure22:FactorsAffectingtheU.S.CosmeticsandToiletriesIndustry,2012
Naturally
positioned
products
Increasinguseof
smartphones
drives
interactionwith
brands
Innovative
productswith
better
technologies
Stable
Growth
Increasein
marketingand
promotional
activities
Risingconsumer
confidence
Products
providing
better/
professional
results
Multibenefit
productsthrive
24
ExecutiveSummary
Consumersareincreasinglyseekingvaluebasedpersonalcareproducts.
However,theyareopentospendingonproductsthatcanaddresstheirspecificneeds.
Thisisevidentbytheincreasingsalesinthedepartmentandspecialtystores.
A mix of products at different price points keeps the pressure on different retail
channels to consistently innovate to retain their consumers. This eventually leads to
better shopping experience for consumers either in terms of competitive pricing or
betterproductquality.
The other channels, such as food stores and drug stores, also increase their product
portfoliotomaintaintheirsalesgrowth.
Marketers use an increasing number of retail channels and marketing tools to reach
consumers.
Productinnovationsbackedupwithsciencebasedtechnologiessupportthegrowthofthe
cosmeticsandtoiletriesindustry.
Products with technological advancements primarily in the skin care product class
support the sales of the cosmetics and toiletries industry in 2012. Further, products
thatspantwoormorecategoriesarepopular.
Products with multibenefits across categories including skin care, hair care, and oral
caredrivethevaluesalesoftheindustryin2012.
Naturalandorganicproductscontinuetobeindemand.Tomeetthegrowingdemand
fromconsumers,marketersalsoinnovateandlaunchadvancednaturalproducts.
Marketerscontinuetoevolvewithinnovativemarketingstrategiesinordertosupporttheir
salesovertheforecastperiod.
In 2012, LOral launches a femalecentric Xbox application to keep its female
consumers engaged with its brands. The new application Next Level offers product
articles,howtovideos,andlatestbeautystylesandtrendsbasedonLOralsbrandsin
theUnitedStates.
Facial treatments continues to be the leading category in the cosmetics and toiletries
industryin2012,contributingto16.4%ofthetotalsales.
ThefacialtreatmentsmarketintheUnitedStateshasanotheryearofstronggrowth,
up4.5%during2012.
Consumers continue to invest in themselves by spending money on products and
devicestokeepagingatbay.
The highest percentage growth occurred among products in the luxury trade class,
followed by those in the professional trade class, indicating consumers further
willingnesstospendonthemselvesandtotradeuptomorepremiumproducts.
Newproductstypicallycreateexcitementinthefacialtreatmentarenaandoneofthe
bigproductstoriesduring2012isthegrowthofBBcreams,thatareessentiallyhybrid
productsthatblurthedistinctionbetweenskincareandfacemakeup.Forpurposesof
thisreport,theyarecategorizedasfacialtreatments,andnotasmakeup.
Technologybackedwithclaims,suchasvisibleresults,isoneofbiggrowthdriversof
facialtreatmentsduringtheyear.
Productsthatinteractwithskincells,eithertoactivategenesorcorrectflawsandthat
offernoticeableresultshelptostimulatesales.
4A4
ExecutiveSummary
Theuseofmultipleserumsonthefaceisalsoagrowingtrend.Thesenewgeneration
serumstypicallycontaineitherdryoils,hyaluronicacid,orotheracids,andarelightin
textureforfastabsorptionsothattheycanbelayeredunderotherserums.Examples
of these serums launched in 2012 include Ferulic Acid + Retinol Brightening Solution
from Dr. Dennis Gross, Body Shop Nutriganics Drops of Youth, and Este Lauders
PerfectionistCP+Rserum.
BB Creams, also known as beauty balms, blemish balms, or beauty benefit creams,
surfacedintheUnitedStatesinlate2011.Theseproductsexplodeonthescenein2012,
withmostmajorfacialtreatmentandmakeupmarketerslaunchingtheirownversion
oftheseproductsduringtheyear.
During 2012, the Food and Drug Administration (FDA) continues to look at the
marketing claims of facial treatment products, especially those making claims of
biologicallyenhancedbenefits.
An increasing number of beauty specialty retailers launch their own facial treatment
linesinthepasttwoyears.Thesearenotlinesthatmimicnationallyadvertisedbrands,
butrathercontainaproprietarymixofingredientsgearedtotheneedsoftheretailers
customerbase.
Sephora started the trend with the launch of the Sephora Collection in early 2011
which is sold at all Sephora and Sephora within JCP locations. The ingredient theme
running through the line is a proprietary plantderived ingredient that the company
claimsismoreeffectivethannationallyadvertisedbrands.
UltalaunchedUltaSkincareinmid2012,afteranunsuccessfulattemptatitsownfacial
treatmentproductsafewyearsprior.Theingredientstoryofthislineisaproprietary
complexcalledAdvancedProtectionFactor+,saidtocombatfreeradicals.
In2012,multibenefitproductsthatprovideprofessionalresultsathomecontinuetogain
attention.
Thetrendofprofessionalresultsathomethatemergedin2010,continuedinto2012
as women upgrade their facial treatment regimen to peels and more expensive at
hometreatmentsinlieuofvisitingaprofessional.
RoCs Retinol Correxion Max Wrinkle Resurfacing System is a twostep system that
renews the look and feel of skin and claims to be clinically proven to be up to four
timesmoreeffectivethanaseriesofdermatologicalpeels.
Although, antiaging products continue to garner the most attention in 2012, multi
benefitproductsthatworktoeliminateandreducesignsofaging,suchasfinelinesand
wrinkles, lighten and brighten skin, provide a smooth appearance, and reduce dark
spotsdrivesalesofthecosmeticsandtoiletriesindustry.
BB creams function as hybrid products that offer both facial treatment and cosmetic
properties, by offering treatment benefits, sun protection, and other attributes
dependingontheproduct,allwiththegoalofperfectskin.Somebrandsoffermultiple
shades,whileothersofferoneshadethatisappropriatetomostskintones.
Some of the most notable BB cream launches during the year include entries from
BobbiBrown,EsteLauder,Smashbox,LOralParis,Garnier,andLancme.
Inlate2012andearly2013,CCorcolorcorrectioncreamsbegintoappearontheU.S.
market,andthereareexpectationsthatDDordailydefensecreamsmightalsoemerge
in2013and2014.
25
26
ExecutiveSummary
Antiaging sun care products, providing the dual function of sun protection and cell
repair,arealsoanothersoughtaftersegmentofproducts.
Face makeup products with multiple skin care benefits such as antiaging and
moisturizingdrivethesalesin2012.
Severalleadingmarketerslaunchmultibenefitproductsin2012.
In the hair styling category, Unilever launches TRESemm Platinum Strength Heat
ProtectSpraythatfortifiesandstrengthenshair.
Inthelipbalmscategory,MargaritavillelaunchesFloridaysMoisturizingLipBalmwith
SPF50thatprovidesmoisturizationbenefitsaswellassunprotection.
Intheshampooscategory,Procter&GamblelaunchesPanteneAgeDefyshampoothat
works together to help hair act up to 10 years younger by thickening existing hair
strands.
Kaolaunchescolorprotectionandcolorenhancementhaircareproductsin2012.
Inthemouthwashescategory,ColgatePalmoliveexpandsitsOpticWhiteportfoliowith
anewRefreshingMintmouthwashthatclaimstoeffectivelywhitenteethandprotect
againstfuturestains.
In the toothpastes category, several leading marketers including ColgatePalmolive,
Procter&Gamble,andGlaxoSmithKlineintroducemultibenefittoothpastes.
In2012,productsinfusedwithnaturalingredientscontinuetoperformwell,supportedby
severalnaturallypositionedproductlaunches.
Growingpublicconcernaboutsyntheticingredients,suchastriclosanandparabensare
drivingthesalesofnaturalproducts.
Consumersarebecomingmoreawareandeducatedabouttheingredientsinpersonal
careproducts.
Consumers incorporate the trend of health and wellness in their spending patterns,
and shift to natural products for their personal care needs, as they contain minimal
levelsofsyntheticcompounds.
Suchproductsaregenerallypricedhigherthanregularbrandsandhelptheindustryto
growitsoverallsalesvalue.
Natural and organic products are becoming more mainstream, with their availability
spreadinginallchannels.
Marketers are introducing natural products in niche and growing segments, such as
mensskincareandethnichaircare.
Several leading marketers including LOral and Procter & Gamble launch naturally
positionedproductsacrosscategoriestosupporttheiroverallsales.
In the oral care product class, Hello Products, based out of New Jersey, introduces a
newlinecalled99%naturaloralcareproductsincludingtoothpastes,mouthwashes,
andbreathfreshenersunderthebrandnameHello.
Inthehaircareproductclass,LOralintroducesEverCremelinethatclaimstocontain
naturalbotanicalsandisfreefromparabens.
LOralalsointroducesseveralnaturallypositionedproductsundertheGarnierFructis
andLOralParislinesin2012.
However,thetrendofusingnaturalingredientsincosmeticsandtoiletriesproductsis
slowly reaching its maturity as natural or naturally positioned products find their
presenceinalmostallproductclassesandevenbrands.
4A6
ExecutiveSummary
Some of the causes of less than exceptional growth include increasing FDA scrutiny on
productclaimsandmarketersfocusoninternationalmarkets.
Ongoing factors such as a competitive environment, a mature economy, and
globalization have forced most of the leading marketers to expand their business
outsidetheboundariesoftheUnitedStatestomaintaintheirprofitmargins.
Domestic marketers in the industry have a significant interest in expanding their
businessesinternationally.
Marketerscontinuetofocusonexpandingtheirbusinessesintheemergingcountries
including Brazil, Russia, India, and China where the growth for the industry is higher
thanintheUnitedStates.
ThemarketsinAsiapromiselargesalesvolumesforglobalmarketersintheindustry.
Highly populated countries such as India and China can be great prospects for
expansion in the beauty industry as the standard of living in these countries is on a
sharprise.
This has been a major reason for U.S.based global companies to focus more on
developingtheiroperationsintheemergingAsianmarkets.Manyoftheglobalplayers
have been shifting focus and resources outside the United States, thereby reducing
supportfortheirbrandsinthiscountry.
The 26 product categories analyzed in Cosmetics& Toiletries USA are grouped into six
productclasses,asfollows:
Fragrances
Haircareproducts
Makeupproducts
Oralcareproducts
Othertoiletries
Skincareproducts
Skin care continues to be the largest product class in 2012, representing 25.8% of sales,
marginallyupfrom25.6%ofsalesin2011.
Themakeupproductclassisthesecondleadingproductclass,representing19.0%oftotal
dollarsalesin2012.
Dollar sales for the U.S. cosmetics and toiletries industry advance 3.4% in 2012 to
$40,372million,upfrom$39,026millionin2011.
Alltheproductclassesregisterasalesgrowthabove1.0%in2012.
27
28
ExecutiveSummary
Figure23:U.S.ManufacturersSalesofCosmeticsandToiletriesbyProductClass,2012
Fragrances,9.5%
Skincare,25.8%
Oralcare,10.5%
Othertoiletries,
16.4%
Makeup,19.0%
Haircare,18.8%
Makeupregistersthehighestgrowthrateof4.3%in2012.
Eyemakeupandfacemakeupcategoriesprimarilysupportthegrowthofthemakeup
productclassin2012.
Both face makeup and eye makeup collectively represent 75.5% of total makeup
productclasssalesin2012.
Growth of the eye makeup category is fueled by new product launches that include
productswithmultiplebenefitsandnewbrushtechnology.
Themostdramaticgrowthcomesfromeyelinerandeyebrowproductsaswomenstrive
for eyes that communicate sex appeal, with dramatic eyeliner and accentuated
eyebrows.
All face makeup product types contribute to the categorys growth. The luxury class
outperforms all other classes. Complexion products continue to be an important
componentinawomensmakeupregimenastheystriveforaflawlessfinish.
Nail polishes is the smallest makeup category, though continues to be the fastest
growingcategory,upby17.4%from$564millionin2011to$662millionin2012.Nail
polishesrepresent8.6%oftotalsalesin2012,upfroma7.0%sharein2011.
Thenailpolishboomcontinuesasmarketersprovideabundantinnovativetechnologies
with products for consumers to imitate salon effects in a costeffective manner at
home.Theassortmentofnailcolorsandthosewithuniquefinishesandtexturesfrom
geltocaviartovelvetandsequinnailscontinuetoaddfreshnesstothecategory.
Lipsticksandlipglossesrepresent18.0%oftotalmakeupsalesin2012,upslightlyfrom
17.6%oftotalmakeupsalesin2011.
Lipsticks perform better than lip glosses and lip liners due to fashion trends, and the
new formulas available on the market. Longwearing lipsticks that go on sheer with
buildablepigmentsarepopular.
4A8
ExecutiveSummary
Skincareisthesecondfastestgrowingproductclassin2012,withsalesimprovingby4.1%
to$10,433million,upfrom$10,021millionin2011.
Sun care products and skin care products for men post the highest growth in the
productclassin2012.
Facial treatments primarily contribute to the growth of the skin careproduct class in
2012. Antiaging remains the major thrust of the facial treatments category. While
serums in facial treatment products have been popular for the past few years, 2012
seesthelaunchofserumsspecificallyfortheeyearea,tobeusedwithaneyecream.
Facial treatment marketers are getting bolder about touting product benefits, which
getsnoticedbytheFDA.
Allthecategoriesintheskincareproductclasspostgrowthofmorethan1.0%in2012.
Hand and body lotions enriched with antiaging benefits continue to be a prominent
trend.
The availability of hand and body lotions in a variety of exotic fragrances is a
significantlygrowingtrend.
Thesuncarecategorysgrowthisdrivenbyanincreasingawarenessamongconsumers
about the harmful effects of the skins exposure to the suns rays. Other factors
contributingtothesuncarecategorysgrowthincludenewproductactivity,packaging
and labeling changes, and innovative reformulations. The category is hampered by
increasing SPF properties in other categories, such as face makeup and facial
treatments.
Mensfacialskincarerepresentsahighgrowthopportunityformarketers.
ThepracticallyflatbirthrateintheUnitedStateshasadetrimentaleffectonthebaby
careproductscategoryssales,yetnaturalproductsdoparticularlywell.
Ofthe26categoriesanalyzedinthisstudy,24categoriesexperiencesalesgrowthin2012.
Thecategoriesthatdeclinearehaircoloringproductsandtoothwhiteningproducts.
Figure24:TheU.S.CosmeticsandToiletriesIndustrysGrowthRates,2002to2012
Change,%
5%
4%
3%
2%
1%
0%
1%
2%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
29
210
ExecutiveSummary
Figure25:TheU.S.CosmeticsandToiletriesIndustrysGrowthRatesbyProductClass,2011to2012
$Million
14,000
Change,
4.1%
12,000
10,433
10,000
10,021
Change,
2.9%
Change,
4.3%
7,341
Change,
3.0%
7,610
7,657
8,000
7,393
6,412
6,602
Change,
1.6%
6,000
4,000
Change,
3.9%
4,184 4,252
3,675 3,818
Oralcare
Fragrances
2,000
0
Skincare
Makeup
Haircare
2011
Other
toiletries
2012
Figure26:HistoricalandCurrentGrowthRatesoftheU.S.CosmeticsandToiletriesbyProductClass,2011to
2012
CAGR,%
5%
4.3%
4.1%
4%
3%
3.9%
3.8%
3.0%
2.9%
2.7%
2.5%
2%
1.6%
1.2%
1.2%
1%
0.4%
0%
Skincare
Makeup
Haircare
Othertoiletries
2011
Oralcare
2012
4A10
Fragrances
211
ExecutiveSummary
Handandbodylotions
Babycare
Toothpastes
Dentureproducts
2.1
1.9
1.8
1.8
1.7
1.3
1.3
Fragrancesformen
3.6
Facemakeup
3.7
2.1
Fragrancesforwomen
4.0
Toothbrushes
Facialtreatments
4.5
2.2
4.8
Mouthwashes
Conditioners
4.8
2.2
Shampoos
4.8
Shavingproducts
Suncareproducts
6.5
3.0
9.7
13.2
3.0
Nailpolishes
17.4
Eyemakeup
(0.5)
Change, %
3.4
(5.6)
Figure27:TheU.S.CosmeticsandToiletriesIndustrysGrowthRatebyCategory,2011to2012
Industry Average
Thenailpolishescategorypoststhehighestgrowthin2012,asithassince2010.In2012,it
isupby17.4%,from%564millionin2011to$662millionin2012.
Thenailpolishboomcontinuesasmarketersprovideabundantinnovativetechnologies,
with products for consumers to imitate salon effects in a costeffective manner at
home.
Theassortmentofnailcolorsandthosewithuniquefinishesandtexturesfromgelto
caviartovelvetandsequinnailscontinuetoaddfreshnesstothecategory.
Geltechnologyisoneofthemaindriversinnailpolishesin2012,atrendwhichbegan
intheprofessionalchannelandhasmigratedtoconsumers.Itisthenewstandard,and
thelongwearthatgeltechnologydeliversisverypopular.
Depilatories, waxes, and bleaches category posts the secondhighest growth of 13.2% in
2012.
Olays exceptional growth in 2012 is the primary reason for the categorys healthy
growth.
Factorssuchasnewproductactivity,formulationimprovements,andinnovationdrive
thecategorysgrowthin2012.
Thereisanincreasingtrendtowardsdoityourself(DIY)athomehairremovalproducts
thatgiveresultsalmostsimilartoasalonservice.
Depilatory products in the form of inshower products and hairremoving sprays, are
gainingprominenceinthecategoryduetotheconvenienceofusingtheseproducts.
Consumersareincreasinglyshiftingtowardstheuseofnewerwaxproductsduetothe
advancedtechnologyusedandtheeaseofconvenientapplicationincomparisontothe
previouslydifficulttousewaxproducts.
Products that have ease of application and provide results in less time are proving
moresuccessfulinthemarket.
212
ExecutiveSummary
Theskincareproductsformencategoryexperiencessignificantgrowthof9.7%in2012.
Prestige marketers, such as Este Lauder, Anthony Brands, and Jack Black introduce
new and innovative product offerings to reach out to the male consumers who are
increasinglybecomingconsciousoftheusageofproductstoimprovetheirappearance.
Marketers have an opportunity to expand in the mens facial skin care segment with
relevant product offerings on antiaging, sun protection, and moisturizing; however,
products that perform well offer multiple benefits in one package, as men prefer a
minimalistroutine.
Thesuncarecategoryisthefourthfastestgrowingcategoryin2012,upby6.5%.
In 2012, sprayon formats, lightweight nongreasy formulas, antiaging benefits,
moisturizingformulas,andmakeupapplicationformatscontinuetogarnerconsumers
attention.
With the new FDA rules and regulations on the broad spectrum coverage, marketers
arelookingatwaysofincreasingtheircompetitivenessinthemarket.
FDAsfinalregulationsforoverthecounter(OTC)sunscreenproductscomeintoeffect
fromJune2012.However,toavertanyshortageoftheseproductsinthemarket,the
FDA extends the compliance dates for testing and labeling of these products to
December17th,2012forlargerbrands,andtoDecember2013forproductswithsales
oflessthan$25,000peryear.
According to the FDAs new regulations, companies manufacturing sun care products
willhavetopasstheUVAandUVBprotectiontestinordertoclaimBroadSpectrum
protectiononitslabel.
RETAILLANDSCAPE
Mass merchandisers continue to be the most preferred retail channel for cosmetics and
toiletries, with total sales advancing 3.5% to reach $12,404 million in 2012, up from
$11,981millionin2011.
Mass merchandisers represent 30.7% of total industrys sales in 2012, constant from
2011levels.
Astheeconomycontinuestorecover,consumersseekvaluefortheirmoneyandseek
outletsofferingthebestprices.
Budgetbrandshelpfuelthegrowthinthemassmerchandiserchannel.
Themassmerchandiserretailchannelcomprisingbigboxretailers,warehouseclubs,
and dollar storesis increasingly viewed as a destination for stocking up on
commoditytype items, such as personal cleansing products, shampoos, and
deodorants.
Marketerscontinuetoevolvewaysinwhichwomencanobtaintheperfectshadevia
virtual online consultants, matching department store brand shades to products in
theirmassline.
4A12
ExecutiveSummary
Privatelabel products, a growing segment in the cosmetics and toiletries market is

predominantly present in mass merchandisers. The increasing popularity of these
privatelabelproductsaidsinthechannelsgrowth.
Additionally,thereisagrowingtrendofmassmerchandiserslaunchingtheirownline
ofprivatelabelproducts.In2012,WalgreensintroducestheOlogylineofproducts.
Mass merchandisers frequently launch promotional campaigns and offer discounts of
variouskinds,whichdrivetheirsalessubstantiallytohigherlevels.
The circulars, which promote a variety of product categories, including cosmetic and
toiletryproducts,aredistributedinstores,weekendnewspapers,andsometimesalong
withotherflyersatlocalsupermarketsanddrugchains.
Mass merchandisers also focus on natural products, which fascinate both the
marketers and consumers. Mass merchandisers continue to include private labels for
naturalpersonalcareproductsinordertocatchmoreattentionfromtheconsumers.
Drug stores follow as the secondleading retail channel for cosmetics and toiletries in the
UnitedStates,withsalesat$7,276millionin2012,up1.8%from$7,149millionin2011.
The share of distribution for drug stores decreases nominally from 18.3% in 2011 to
18.0%in2012.
Drugstorescontinuetooffereconomicalpricedproductsandprivatelabelproducts.
Drug stores continue to lose sales to mass merchandisers and department stores as
thesestoresstartsellingbudgetbrands,whilerevampingandextendingshelfspaceto
morebrands.
Drugstoreretailerscontinuetodiversifytheirproductofferingswithaddedemphasis
onthefrontendtobettercompetewithotherretailchannelsthatencroachtheirturf,
suchasmassmerchandisersandwarehouseclubs.
Drug stores continue to offer loyalty programs and promotional coupons, in order to
enticeshopperswiththebestdeals.
Drugstoresaimatbroadeningthespectrumoftheproductsthattheyoffer,inorderto
havemoreconsumers,andenhancetheirconnectivitywiththem.
Drugstoresareincludingprivatelabelsinasmanyrangesofproductsaspossible,along
withenhancingservicesfromsalespersonnel.
Acquisitions are one of the ways for the major drug chains to grow and have been
responsible for major door expansion of Walgreens since 2005. Small regional chains
arepickedupbybothWalgreensandCVStofillinholesintheirnationalcoverage.
213
214
ExecutiveSummary
Department stores are the thirdleading retail channel for cosmetics and toiletries, with
salesat$5,417millionin2012,up5.0%from$5,157millionin2011.
The share of sales from department stores increases from 13.2% of sales in 2011 to
13.4%in2012.
Department stores continue to be the most soughtafter shopping destination, as
personalconsultationisakeycomponentfortrialandpurchase.
Many women continue to seek brands that are only found in department stores for
theirlipstickpurchases.
Department store sales are cannibalized as some shoppers purchase from the e
commercesitesofdepartmentstores,whicharecapturedintheInternetsalesofthe
directchannel.
Departmentstoresprovideloyaltyprogramstobuildandstrengthentheirrelationship
with the consumers, by taking initiatives to enhance their communication with
consumers.
Departmentstoresfocusonofferinghighlyadvancedproductsinfusedwithadvanced
technology,soastoexpandtheirconsumerbase.
Consumersarewillingtospendonluxuryandpremiummakeup,facialtreatments,and
fragranceproducts,afterbeingfrugalduetorecessioninthelastfewyears.
FoodstoresarethefourthleadingretailchannelforcosmeticsandtoiletriesintheUnited
States,withsalesup1.3%toreach$5,217millionin2012,upfrom$5,149millionin2011.
Thedistributionshareforfoodstorescontinuetoslidefrom13.2%in2011to12.9%in
2012.
Foodstorescontinuetodisplayincompetencewhencomparedtomassmerchandisers
and department stores, because mass merchandisers and department stores offer a
widerrangeofproductsatcompetitiveprices.
Food stores, however, focus on natural ingredientbased products that have gained
prominenceinthemarket.Astheseproductsfascinatebothmarketersandconsumers,
thelossofsalestootherchannelsiscompensatedtoaconsiderableextent.
Some food store chains call for thirdparty certification on all personal care and
cosmeticsthatareclaimedtobeorganic.
Ascosmeticandtoiletriesmarketersofferanevergrowingnumberoflineextensions,
foodoutletsoftenfindthemselvesshortofspacetoofferalltheavailableproducts.
Food stores also make an attempt to modify their merchandising layouts in order to
bettersellbeautyproducts.
4A14
ExecutiveSummary
The direct sales channel registers sales at $4,499 million in 2012, up 6.7% from
Thedirectsaleschannelaccountsfor11.1%oftheU.S.cosmeticsandtoiletriesmarket
in2012,upfrom10.8%in2011.
Thedirectchannelincreasesduetoonlinesalesfrombothbrickandmortarretailers,
suchasspecialtyanddepartmentstores,andtheInternetonlyretailers.
Ecommercecaterstothehighestgrowthofthedirectchannelssales.Theelimination
ofshippingchargesformostbeautypurchasesoveracertainminimum,coupledwith
shoppersfeelingmorecomfortablemakingonlinebeautypurchases,contributestothe
fastgrowthofthissubchannel.
DirectsalesoverallareimpededbyAvonsfailuretokeepupwiththeoverallmarkets
growth.CompaniessuchasAvonrelymostlyondirectsalesrepresentatives,anddue
totheirconsistentpoorperformance,theoverallchannelsuffersfromdeclinein2012.
Offers,suchasfreeshippingandsamples,apartfromsmartphoneapplicationsenhance
thegrowthofecommerceandenabletheconsumerstocomparisonshopquickly.
Persontoperson sales continue to dominate as the largest subclass of the direct
channel,despiteadeclineinmarketshare.
Direct sales channels continue to bank on their personalized services which enable
themtoexpandinspiteofmasscompetition.
Specialty stores register increasing sales of $4,228million in 2012, up 8.2% from

Thespecialtystoresaccountfor10.5%oftheU.S.cosmeticsandtoiletriesmarket,up
from10.0%in2011.
Growth in this channel is driven by a large number of new store openings, more
apparel chains with sizeable store counts, knowledgeable sales associates, good
customer service, an easy ability to shop across product lines, and a more fun
environmentthananyotherchannel.
The specialty stores channel grows because of increasing sales from vertically
integrated retailers, such as Bath & Body Works and Victorias Secret, along with
growthfromcosmeticspecialtystores,suchasSephoraandUlta.
Cosmeticspecialtystores,includingUltaandSephora,growduetotheirwideproduct
assortments,promotions,opensellenvironment,andloyaltyprograms.
Specialty stores, such as Ulta and Sephora, continue to attract more customers by
openingnewdoorsregularlyandofferingacontinuallywiderassortmentofbrands.
An increasing number of specialty stores continue to introduce their own facial
treatmentlinesinthemarket.
The products offered by the specialty stores contain a proprietary mixture of
ingredientsmeanttofulfilltheneedsoftheretailerscustomerbase.
Furthermore,specialtystoresnowalsofocusondifferentiatingthemselvesfromtheir
competition,byofferingexclusiveorlicensedlines.
215
216
ExecutiveSummary
The professional channel represents 3.3% of the total industrys sales in 2012, decreasing
from3.8%in2011.
Theprofessionaloutletschannelregisterssalesat$1,331millionin2012,downby9.3%
from$1,467millionin2011.
The increasing popularity of products promising professional results at home
contributestothedeclineofthechannelssalesin2012.
Moreover, consumers continue to opt for doityourself (DIY) solutions across
categoriesincluding,haircoloringproducts,nailpolishes,anddepilatories,waxes,and
bleaches.
Althoughtheeconomyisgettingbetter,consumersfrequencyofvisitingprofessional
outletsremainslowcontributingtothedeclineoftheshareofthechannelin2012.
As a result of the sluggish professional channels performance, some professional
brand marketers are broadening their distribution to include the Internet, specialty
stores,andotherchannelsinordertostaycompetitive.
AmoreindepthanalysisofcosmeticsandtoiletriessalesbyretailoutletisprovidedinKline
&CompanysreportBeautyRetailingUSA.
Thisstudyreviewsandassessesthechallengesthatmarketersmustovercomeinorder
tobesuccessfulandcompetitiveinthedynamicretailenvironment.
Figure28:CosmeticsandToiletriesSalesintheUnitedStatesbyChannel,2011and2012
2011
2012
Professional
outlets,3.8%
Professional
outlets,3.3%
Mass
merchandisers,
30.7%
Specialtystores,
10.0%
Specialtystores,
10.5%
Directsales,
10.8%
Directsales,
11.1%
Mass
merchandisers,
30.7%
Drugstores,
18.0%
Drugstores,
18.3%
Foodstores,
13.2%
Foodstores,
12.9%
Department
stores,13.2%
4A16
Department
stores,13.4%
217
ExecutiveSummary
Figure29:RetailChannelEvolutionintheUnitedStates,2002and2012
2002
Rank
2012
Massmerchandisers
Massmerchandisers
Foodstores
Drugstores
Drugstores
Departmentstores
Departmentstores
Foodstores
Specialtystores
Directsales
Directsales
Specialtystores
Salons
Salons
Table21:GrowthRatesandKeyTrendsforCosmeticsandToiletriesbyCategory,2012
Category
Changeinsales,
%,20112012
Primarygrowthdriversand/ortrends
FRAGRANCES
3.6
Thesuccessofthefragrancescategoryistiedverycloselytotheholidaysellingseason.
CategorygrowthcontinuestobedrivenbyfirmlyentrenchedbrandssuchasLOralsAcquadi
GiandChanelsBleucontinuingtothrive,andbytheexpansionofreputablefranchisessuch
asProcter&GamblesGucciandDolce&Gabbana.
4.0
Salesgrowtoreachalmostprerecessionlevels.Categorygrowthcontinuestobedrivenby
classicssuchasChanelsCocoMademoiselle,ChanelNo.5,andChance;alongwiththe
expansionofpopularfranchisessuchasElizabethArdensJuicy,andCotysMarcJacobs.Several
newcelebrityscentlaunchesin2012aretargetedatyoungerconsumers,attractingsomeof
themtothefragrancecounterforthefirsttime.Thetrendtowardsmorenaturalpersonalcare
productscouldbeoneofthefactorsstiflingrealgrowthinthefragrancecategory.
Conditioners
4.8
Conditionersthatofferextrabenefitsapartfrommoisturizationperformwellinthecategory.
Conditionersthatcatertotheneedsofvarioushairconcerns,suchasthinning,volumeboost,
andhairtypescontinuetoperformwellin2012.Conditionersthatofferextrabenefits,suchas
protectionfromhaircolorandfrizzprotection,supportthecategorysgrowth.Natural
formulationshavebecomeanorm.
Ethnichaircare
products
2.1
Naturallypositionedproductssupportthecategorysgrowthasethnicconsumersincreasingly
chooseproductsthatcontainnaturalandorganicingredients.IngredientssourcedfromAfrica
playanimportantroleinthecategorysgrowth.
Fragrancesformen
Fragrancesfor
women
HAIRCAREPRODUCTS
Haircoloring
products
Hairstyling
productsandsprays
Shampoos
(0.5)
Astheeconomyrecoversconsumersaremovingbacktoprofessionalhaircoloringservices,
causingdeclineofathomehaircoloring.However,productswithnewformulations,suchas
hairfoamsboostsales.
1.3
Hairstylingproductswithnewformulationsandnewformssupportthecategorysgrowth.Hair
stylingproductsthatcontainnaturalandorganicingredientsremainaprominenttrend,helping
thecategoryssales.Multibenefitproductsgrow.
4.8
Marketersincorporatingmorefunctionalbenefits,suchasfrizzprotectionandantiaging
performwell.Shampoosthatprovideprotectionforcoloredhairandcolorenhancementfor
haircontributetogrowth,asdothosethatcatertospecificconcerns,suchasthinning,and
dandruff
(Continued)
218
ExecutiveSummary
Table21:GrowthRatesandKeyTrendsforCosmeticsandToiletriesbyCategory,2012
Category
Changeinsales,
%,20112012
Primarygrowthdriversand/ortrends
MAKEUPPRODUCTS
Eyemakeup
3.4
Growthisfuelledbynewlaunchesthatincludemultiplebenefitsandnewmascarabrush
technology.Themostdramaticgrowthcomesfromeyelinerandeyebrowproducts.The
plethoraofnewandimprovedmascarasaddexcitement.
Facemakeup
3.7
Newlaunchesinfoundationsaswellassolidperformanceofconcealersarethedrivingfactors
behindthegrowth.Complexionproductsareanimportantcomponentinwomensmakeup
regimenastheystriveforaflawlessfinish.
Nailpolishes
17.4
Thenailpolishboomcontinuesasmarketersprovideabundantinnovativetechnologieswith
productsforconsumerstoimitatesaloneffectsinacosteffectivemannerathome.Gel
technologyisoneofthemaindriversinnailpolishin2012.
1.8
Lowgrowthduetolacklustersalesinlipglossandlipliner.Helpingtofuelsalesproductsthat
toutlonglastingcolorandaddedfunctionality,suchasmoisturizingand/orSPFbenefits,along
withattractivepackaging.Formulasthatarehybridsoflipsticks,gloss,andstainsareatthe
forefront.
Dentureproducts
1.3
ThegrowingnumberofdenturewearersintheUnitedStatessupportsthecategoryslimited
growth,becauseoftheagingpopulation..Thedentalaccessoriesmarketcontinuestogrow,as
denturecleansersexpandtheirscopefromdenturesonly.
Lipbalms,jellies,
andtreatments
4.8
Lipbalmsthatprovideprotectionagainstsun,tintedlipbalms,andlipbalmswhichprovide
othertreatmentbenefitsperformwell.
Mouthwashes
2.2
Mouthwashesthatoffermultiplebenefits,suchasteethstrengthening,helpingrebuildenamel,
andpreventingcavitiessupportgrowthin2012.Amongthese,whiteningmouthwashes
performbest.
Toothbrushes
2.2
Increasingmediasupportwithnewproductinnovationsdrivethesalesoftoothbrushesin
2012,andmostoftheleadingmarketersextendtheirproductlines.
Toothpastes
1.7
Toothpastesthatprovidemultibenefitsincludingbattlingtoothsensitivity,teethwhitening,
andpreventingplaquesupportthecategorysgrowth.
Lipsticksandlip
glosses
ORALCARE
Toothwhitening
products
(5.6)
Thecategoryfacesintensecompetitionfrommultibenefittoothpastesandthemouthwashes
category.Limitednewproductactivityfromseveralleadingplayersresultsinsalesdecline.
Babycareproducts
1.8
Thecategoryhasminimalnewproductactivityin2012.Thekeyreasonbehindthemoderate
growthisthealmostflatbirthrateintheUnitedStates.Naturalandorganicproductsarethe
primaryfactorboostingsales.
Facialtreatments
4.5
Withanemphasisonyouth,thedefinitionofantiagingmovesbeyondwrinkleminimization
andskinfirming,toincludebrightening,eveningskintone,andprovidingradiance.Thetrendof
professionalresultsathomethatcontinuesinto2012.
Handandbody
lotions
1.9
Handandbodylotionsofferingtherapeuticbenefitscontributetothecategoryssales.Hand
andbodylotionsenrichedwithantiagingbenefitsareaprominenttrend.
Skincareproducts
formen
9.7
Prestigemarketers,suchasEsteLauder,AnthonyBrands,andJackBlackintroducenewand
innovativeproductofferingstoreachouttothemaleconsumerswhoareincreasingly
becomingconsciousoftheusageofproductstoimprovetheirappearance.
Suncareproducts
6.5
Thecategorysisdrivenbyincreasingawarenessamongconsumersabouttheharmfuleffects
oftheskinsexposuretothesunsrays.Otherfactorscontributingtogrowthincludepackaging
andlabellingchanges,andinnovativereformulations.
2.1
Growthinthematurecategoryisprimarilydrivenbynewproductintroductions,
reformulations,andpackagingchanges.Clinicalstrengthproductscontinuetobeanother
drivingfactorforthecategorysgrowth.
SKINCARE
OTHERTOILETRIES
Deodorantsand
antiperspirants
Depilatories,waxes,
andbleaches
13.2
TheexceptionalperformanceofOlayspursoverallcategory.Productsthathaveeaseof
applicationandprovideresultsinlesstimearesuccessful.
Personalcleansing
products
3.0
Categorygrowthisledbythestrongperformanceofthebodywashesandliquidhandsoaps
segments.Furthergrowthisoffsetbythegoodperformanceofprivatelabelproducts.
Shavingproducts
3.0
Shavinggelsandcreamscontinuetogainmarketshareoverfoams.Marketersdevelopnew
productsforwomen.
4A18
ExecutiveSummary
STRUCTUREOFTHEINDUSTRY
Thetoptencosmeticsandtoiletriesmarketersrepresent61.9%oftotalsalesin2012,with
nineofthetenmarketerssalesestimatedatmorethanthe$1billionmark.
Procter& Gamble continues to be the undisputed industry leader by a wide margin,
representing14.4%ofthetotalcosmeticsandtoiletriessalesin2012.
LOralretainsitssecondposition,with11.3%oftotalindustrysalesin2012.
Unilevercontinuestobethethirdleadingmarketer,with8.8%ofindustrysalesin2012.
EsteLauderfollowsUnileveratfourthplacewitha6.7%share.
Johnson&Johnsons5.0%shareputsitinfifthplace.
Ofthetop29companies,fivemarketersregisterasalesdecline,and24companiesregister
salesgainsin2012.
GuthyRenker, one of the worlds largest direct response television marketing
companies,registersthehighestgrowthat19.6%in2012,withsalesat$737million,up
from$616millionin2011.
Chanelpoststhesecondhighestgrowthof10.6%in2012.
The Clorox Company, having one of the largest natural personal care brands, posts
growthof8.9%in2012.
Figure210:TheU.S.ManufacturersSalesoftheFiveLeadingMarketersofCosmeticsandToiletries,2012
Procter&Gamble
5,883
L'Oral
4,551
Unilever
3,546
EsteLauder
2,722
Johnson&Johnson
2,020
1,000
2,000
3,000
4,000
5,000
$Million
6,000
7,000
219
220
ExecutiveSummary
In2002,thefivelargestcompaniescontrolled45.9%ofthemarket.
Thisfiguregrewto46.8%in2007andpresentlystandsat46.2%in2012.
Thecompetitivelandscapehaschangedslightlyoverthepastdecade.
Procter&Gamblecontinuestobetheleadingmarketerinthecosmeticsandtoiletries
industry in 2012. The marketer is among the top five in all the six product classes
profiledin2012.
LOralisthesecondleadingmarketerinthecosmeticsandtoiletriesindustryin2012.
Itcontinuestoleadthemakeupproductclassandisthesecondleadingcompanyinthe
hair care class. The marketer acquires Urban Decay specialty makeup brand in the
UnitedStates.
Unilever continues to be the thirdleading marketer in the cosmetics and toiletries
industryin2012.Unileveristheleadingmarketerintheothertoiletriesproductclass.
EsteLauderremainsatfourthplacein2012,withastrongpresenceinthefragrances,
makeup,andskincareproductclasses.
Johnson& Johnson maintains its fifth place, with its strong presence in oral careand
skincare.
Severalmergersandacquisitionscontinuetosupportthecosmeticsandtoiletriesindustrys
growth.
For example, L'Oral acquires Urban Decay specialty makeup brand in the United
States.
BrynwoodPartnersinvestmentfirmmakesaslewofacquisitionsin2012:Coast,White
Rain,LALooks,DepSport,ZeroFrizz,ThickerFullerHair,Soft&Dri,andPure&Natural.
Valeant Pharmaceuticals acquires Ambi from Johnson & Johnson in December 2012,
andObagiinApril2013.
Dr.FreshacquirestheReachbrandofmanualtoothbrushesfromJohnson&Johnson.
MarkwinsInternationalacquiresPhysiciansFormulafor$75million.
Figure211:MarketShareoftheFiveLeadingMarketersofCosmeticsandToiletriesintheUnitedStates,2002,
2007,and2012
%Marketshare
50%
45.9%
46.8%
46.2%
2007
2012
40%
30%
20%
10%
0%
2002
4A20
ExecutiveSummary
Figure212:HistoricalRankingoftheLeadingU.S.MarketersofCosmeticsandToiletries,2002,2007,and2012
Rank
2002
2007
2012
Procter&Gamble
Procter&Gamble
Procter&Gamble
L'Oral
L'Oral
L'Oral
Unilever
EsteLauder
Unilever
EsteLauder
Unilever
EsteLauder
LimitedBrands
Johnson&Johnson
Johnson&Johnson
ColgatePalmolive
LimitedBrands
LimitedBrands
Avon
ColgatePalmolive
ColgatePalmolive
Johnson&Johnson
Avon
Coty
MaryKay
MaryKay
MaryKay
10
Revlon
Coty
Avon
Oneofthemarketleadersin2002(Revlon)isnolongeramongthetop10companies,asit
lostsignificantshareovertheyears.
However,itsCEOhasstatedhisintentiontomakethecompanyaformidableplayerin
thecosmeticsandtoiletriesindustryonceagain.
Procter&GambleremainstheclearleaderintheU.S.personalcaremarket.Boththrough
acquisitionandorganicgrowth,thisleadershiphassolidifiedoverthelastdecade.
However,2012provestobeoneofitsmostchallengingyears,asProcter&Gamble's
categoryleading brands have lost their footing in several categories including
shampoos,toothpastes,andcolorcosmetics.
There are a number of factors causing Procter & Gamble to lose ground to its major
competitors in the United States. The main reason appears to be the companys $10
billion cost saving plan announced in February 2012 which has left some of its
brands lacking necessary marketing support, particularly in light of its competitors
increasingtheirownpromotionalactivities.
Furthermore, Procter & Gambles cost cutting on R&D has affected its rate of new
productintroductionsandabilitytokeepupwiththerapidlychangingmarketplace.
221
222
ExecutiveSummary
LOral is the secondlargest marketer, behind Procter & Gamble, in the cosmetics and
toiletriesindustryintheUnitedStatesin2012.
LOralcontinuestosolidifyitspositioninthecosmeticsandtoiletriesindustrythrough
strategic acquisitions, increasing new product launches, and stronger advertising
support.
InNovember2012,LOralacquiresUrbanDecayspecialtymakeupbrandintheUnited
Statesforapproximately$350million,andthecompanyboostsitssalesthroughoutthe
yearwithahighnumberoflaunchesacrossallitscategories.
LOralhasthelargestTME,withaspendingof$1,448millionin2012,up10.4%from
$1,312millionin2011.Thecompanyaccountsfor23.0%oftotalindustryTMEin2012.
Unileverbecomesthethirdlargestmarketerinthecosmeticsandtoiletriesindustryinthe
United States in 2012, up from fourth position in 2007, through successful product
launchesandincreasingadvertisingsupport.
Unilever augments its management team by appointing employees based on their
experience,skills,backgrounds,knowledge,andinsights.
Product introductions with impactful innovations are also a key growth driver for
Unilever in the personal care industry. The companys EVP of North America Gina
BoswellhaspubliclystatedthatUnileverspastlaunchandleavesyndromehasbeen
rectified,andthatnowitiscommittedtothoroughlysupportingitsproductlaunches.
Under her leadership Unilever made two major U.S. launches in 2012: Simple in
February,andClearinMay.
Johnson&Johnsoncontinuestobethefifthlargestmarketerinthecosmeticsandtoiletries
industry in the United States in 2012, experiences more problems, primarily in the baby
carecategorywhereithashistoricallyenjoyedanimmenselyfavorablebrandimage.
In 2012, Johnson & Johnson recalls its Johnsons Baby Shampoo and discontinues its
AveenosOrganicHarvestlineofproductsonaccountofinclusionofharmfulchemicals.
Johnson&JohnsonsOrganicHarvestlineofshampoolosesitsUSDANOPcertification
on account of the fact that its products contain ingredients that are not on the
nationallyapprovedlistoforganicingredients.
Coty becomes the eighthlargest marketer in the cosmetics and toiletries industry in the
UnitedStatesin2012,upfromtenthpositionin2007.
IncreasingnewproductactivityandTMEsupportthegrowthofthemarketer.
InJune2012,Cotyfilestogopublic,afteritswithdrawalfromAvonstakeoveroffer.
InSeptember2012,CotydecidestoputasideitsplansofitsIPO,postponingitto2013.
The decision to delay the IPO is taken in order to give the newly appointed CEO
MicheleScannaviniconsiderabletimetoadjusttohisrole.
In June 2013, Coty finally is offered on the New York Stock Exchange under symbol
COTY,at$17.50pershare.
4A22
ExecutiveSummary
AvonscosmeticsandtoiletriesproductsintheUnitedStatescontinuetodeclineinarow
for five years as the marketer faces problems such as defection and low morale of sales
associates.
Several other factors, such as business restructuring, decline in the total number of
active representatives, warning from the FDA regarding few variants of the Anew
product line, and talks of a possible buyout of the company contribute to the sales
declineforAvon.
InOctober2012,AvoncatchestheFoodandDrugAdministrations(FDAs)attentionfor
havinginfringedguidelinesregardingfivedifferentproductsofitsAnewrange.
FDA claims that some of its products have uses that apparently cause them to be
classifiedasdrugs.Asaresult,FDAasksAvontorectifytheviolations.
InJanuary2013,AvonannouncestheclosureofitsdistributionfacilitiesinAtlanta,GA
andPasadena,CAasameasuretocutcosts.
In February 2013, Avon declares its fourthquarter losses deepen as a result of
restructuringinitiatives.
OUTLOOK
Thecosmeticsandtoiletriesindustryisforecasttowitnessmoderategrowthof3.0%during
theforecastperiod,2012to2017.
DollarsalesareforecasttoincreaseataCAGRof3.0%toreach$46.8billionin2017.
Unitvolumeisexpectedtocontinuetofallbehinddollargrowth,ataCAGRof2.0%to
10.9billionpackagesin2017,upfrom9.9billionpackagesin2012.
Forecast models that project sales performance, given either an economic boom or
recessionoverthenextfiveyears,appearintheFutureViewchapteroftheIndustryAnalysis
section.
223
224
ExecutiveSummary
Figure213:ProjectedUnitandDollarSalesoftheU.S.CosmeticsandToiletriesIndustry,2012to2017
50,000
46,829.0
45,000
40,372.0
40,000
35,000
30,000
25,000
20,000
15,000
9,887.5
10,000
10,924.7
5,000
0
Unitsales
Forecastsales
2012
2017
Figure214:ProjectedDollarSalesoftheU.S.CosmeticsandToiletriesIndustrybyProductClass,2012to2017
$Million
14,000
12,000
10,000
8,000
6,000
4,000
2,000
0
Skincare
Makeup
Haircare
2012
Other
toiletries
Oralcare
2017
4A24
Fragrances
ExecutiveSummary
Skin care and makeup are expected to be fastest growing product classes, with sales
growingataforecastCAGRof4.5%and3.8%,respectively,through2017.
Skincareisexpectedtoremaintheleadingproductclassintermsofdollarsales.
New and improved product formulations, innovations in the form of packaging, and
attentionseeking marketing and promotional activities, including the popularity of
social media network channels and the growing acceptance towards mobile media
includingQRcodes,areexpectedtosupportthegrowthoftheskincareproductclass.
Skincareproductsofferingadditionalbenefits,suchasantiaging,naturalformulations,
andtherapeuticofferings,areexpectedtodrivesalesintheproductclass.
Suncareproductsandskincareproductsformenareexpectedtocontributestrongly
towards the skin care products growth, with an estimated CAGR of 7.1% and 5.4%,
respectively,through2017.
AstheU.S.populationincreasinglymakesitahabitofusingsunscreenregularly,dueto
consistent warnings about the dangers of sun exposure, the category is expected
benefitgreatly.
Growth of the sun care products category will be driven by new product activity,
improvedformulations,innovations,andanincreaseinthepricepointsoftheproducts.
Mensskincareproductsarealsoexpectedtoperformbetterintheforecastyears,as
productsformenofferingcosmeticbenefits,suchasconcealersandtintedmoisturizers,
already available in the market, are likely to attract the attention of the male
consumers.
Inthemakeuptradeclass,thenailpolishescategoryisprojectedtoaccelerateataCAGRof
9.0%,thehighestintheproductclass,followedbyeyemakeupwhichisforecasttogrowat
aCAGRof4.0%.
Growthofthemakeupproductclasswillbesupportedbyanincreaseintheadvertising
andpromotionaleffortsofthemarketers,includingthosethathavenotadvertisedin
thepast.
It is anticipated that marketers with skin care brands will continue to introduce
scientificallyadvancedingredientsintomakeupproducts,especiallythoseproductsin
thefacemakeupcategory.
Hair care products are forecast to post a moderate growth of 2.1% during the forecast
periodsupportedbyinnovativeproductlaunches.
Shampoos and conditioners are expected to drive the sales of the hair care product
classinthenextfiveyears.
Haircareproductswithimprovedformulationsandinnovativepackagingareexpected
tosupportthegrowthoftheproductclass.
Shampoos are likely to experience the most growth over the next five years, with a
CAGRof3.1%,closelyfollowedbyconditionersataCAGRof2.5%.
Shampoosandconditionerswithnewandimprovedformulationsareexpectedtodrive
thecategoriesgrowthovertheforecastperiod.
Moreover, products that cater to specific hair problems and hair types will perform
wellandalsodriveupdollarsales.
Haircoloringproductsareexpectedtoseetheleastgrowthintheforecastperiod,with
aCAGRof0.4%.
225
226
ExecutiveSummary
TheoralcareproductclassisforecasttogrowataCAGRof1.2%duringtheforecastperiod.
Toothpastes,mouthwashes,andtoothbrushes,thethreelargestcategoriesintheoral
careproductsclass,withacollectiveshareof77%willdrivetheoverallmarketssales
withaCAGRof1.2%.
Salesoftoothwhiteningproductswillcontinuetodeclineduringtheforecastperiodat
a negative CAGR of 0.5%, as the whitening benefits of other oral care products
proliferate.
Multibenefitproductsacrossallthecategorieswilldrivethesalesoforalcareproduct
Several leading marketers, including Procter & Gamble and ColgatePalmolive, are
expected to launch more innovative products to support the oral care product class
growth.
SalesoffragrancesareprojectedtoincreaseataCAGRof3.2%throughtheforecastperiod.
Theproductclassisstilllargelydependentonholidaysalesandforeigntourists,bothof
whicharenotenoughtosubstantiallygrowthecategory.
Whilenewproductshelpcreatesomeexcitementintheindustry,mostofthegrowth
comesfromestablishedscentsandfranchises.
Furthermore,habitsarechanging,andconsumersdonotusefragranceseveryday.
Until the fragrance industry develops more natural scents, containing less synthetic
ingredients that are less likely to interact with the bodys endocrine and hormonal
functioning,fragranceswillnotbeusedbyalargenumberofpeople.
FragrancesforwomenisexpectedtogrowataCAGRof3.5%whilefragrancesformen
ataCAGRof2.5%.
TheothertoiletriesproductclassisforecasttogrowataCAGRof1.7%through2017.
Additional benefits in products, such as moisturizing, cleansing, antiaging, and
vitamins,willhelpinmaintainingconsumerinterestinthecategory.
The highest growth is forecast to come from the depilatories, waxes, and bleaches
categoryandpersonalcleansingproductswithaCAGRof3.7%and1.9%,respectively,
althoughallothercategoriesgrowthisforecastbetween1.0and2.0%.
APPRAISALANDOPPORTUNITYASSESSMENT
Thecosmeticsandtoiletriesindustryisforecasttopostmoderategrowthof3.0%overthe
next five years supported by various factors including innovations, natural products,
mergersandacquisitions,andanincreaseinmediaspending.
High income consumers are expected to stay fairly unscathed during the forecast
period,therebysupportingthesalesintheluxuryandspecialtytradeclasses.
Competition between trade classes is expected to intensify, with each trying to
outperform the other with respect to innovation, marketing strategies, and distinct
productofferings.
4A26
ExecutiveSummary
Figure215:FactorsAffectingtheU.S.CosmeticsandToiletriesMarket,2012to2017
Positivefactors
Negativefactors
Fragrancestoremainchallenged
Stricterlegislationonclaimsand
Innovativeproductforms,product
designs,anddeliverysystems
Naturallypositionedpersonalcareto
ingredients
Consumercautiousnesson
generatecuriosity
spending
Multibenefitandspecialized
productstoremainstrong
Mergersandacquisitions Industry
consolidation
Moderate
Industryconsolidation
Falteringperformanceofpersonto
Growth
NeglectingtheU.S.marketsinfavor
personsalessubchannel
ofhighergrowthmarkets
Increaseinpromotionaland
innovativemarketingactivities
Demandforantiagingproductsto
remainstrong,acrossmany
categories
Luxuryandspecialtychannelswill
seeincreaseintraffic
Keepingtheconsumersgluedwithcontinualinnovationtheonlymantratocombat
thestiffcompetitioninthecosmeticsandtoiletriesmarket
Innovations and technological advancements in terms of products, packaging, and

formulations are expected to support the forecast growth of the cosmetics and toiletries
industryintheUnitedStates.
Exciting new products armed with innovative properties across categories will create
interest,andthisnewnesshelpstopropeltrialofnewproductsandincreasesales.
Innovation backed by science will continue to be the main impetus over the forecast
period.
Innovation can be seen in different areas, such as packaging changes, product
reformulations,moreintensifiedresearchanddevelopment,adaptingtothenewFDA
rulesandregulations,andtheuseofnewconceptsandtechnologytobringfreshness
inthecosmeticsandtoiletriesindustry.
Further innovation can also arise from a few other sources, such as a fresh business
model, improved distribution, innovative marketing strategies, and interdisciplinary
innovation.
The thriving success of online sales and infomercials, countered by downturns in the
UnitedStatesofthedoortodoordirectsalesmethod,indicateopportunitiesinnewer
distributionchannelspoweredbytechnology.
With the onset of natural products in the market, marketers have another area to
exploreandinnovatewithproductofferings.
227
228
ExecutiveSummary
Naturalpersonalcaremarketwillcontinuetogrow,eventuallynearing
thematurephaseduringtheforecastperiod
Thenaturallypositionedproductsareexpectedtodrivesalesofthecosmeticsandtoiletries
industryintheUnitedStatesovertheforecastperiod.
Increasingawarenessamongconsumersregardingharshchemicalswilldrivethesales
ofnaturalproducts.
Consumerswillcontinuetolookforproductsthatcontainnaturalingredients,suchas
herbalandfloralextracts.
Truly natural products will be in great demand, but naturalinspired brands will also
continuetoflourishthroughtheforecastperiod.
Somecompaniesrecognizethepotentialinthenaturalpersonalcaremarketandare
increasingtheirfocusonthegrowingsegmentsinthenaturalpersonalcareindustryby
introducingnewproductsandfurtherexploringnewproductcategories.Thelaunchof
manynewproductsintothenaturalpersonalcaredomainkeepstheinterestofmany
consumersintactinthemarket.
Severalretailchannelsincludingmassmerchandisers,drugstores,andfoodstoresare
expectedtooffermoreshelfspacetonaturalproducts.
Theprofessionalskincaresegmentislikelytobethenextfrontforthenaturaltrendto
hit,andislikelytogainmomentumwitheachyearduringtheforecastperiod.
However, the growth of the natural products is likely to slow down during the latter
halfoftheforecastperiod,butstillretainhighergrowththantheoverallindustry.
Specializedproductssuchasmultibenefitsandgenderspecificproducts
auniquewaytobedistinctandgainsales
Productsthatoffermultibenefitsacrosscategoriesareprojectedtoperformwelloverthe
nextfiveyears.
Afewoftheleadingproductclasses,suchasskincareandmakeup,willincludenew
concepts and technology, such as the use of peptides, stem cell technology, aerosol
pump sprays, nongreasy products, and DNAcustomized formulations in its product
portfoliotobringinnovativescientificdevelopmentstothemarket.
Antiaging products will continue to be the bestperforming products in the skincare
and makeup product classes. The use of better technology and newly developed
ingredientswilldriveupthepricepointsofsuchproducts.
Additional benefits, such as smooth makeup finish, sun protection, and achieving
professionalresultsathomewillmaintainthegrowthratewhilethepricesincrease,to
maintaindollargrowth.
Ingredients such as UV protectors, vitamins, and fruit and botanical extracts will be
increasinglyusedinmakeupandskincareproductformulations.
The mens segment is expected to experience resurgence, providing a great
opportunityformarketerstointroducenewinnovativeproductsandgainsales.
Theyoungergenerationisopeninguptotheuseofmaleorientedproducts.
Moreover, increased awareness about male grooming backed by aggressive TME
activities are likely to see an increase in the penetration rate of men using products
specific to men as they open up to the idea of going beyond the regular shaveand
cleanseregime.
Productsformenofferingcosmeticbenefits,suchasconcealersandtintedmoisturizers,
willbeanotherareaformarketerstoattracttheattentionofthemaleconsumers.
4A28
ExecutiveSummary
Mergers,acquisitions,anddivestituresleadtoashiftingcompetitivelandscape
Manydealsareannouncedthrough2012andthislevelofconfidenceandactivityinM&A
continues to pace into 2013, as exemplified below. Such mergers allow companies to
expandtheirproductreachanddistribution.
Ithasbecomeevidentthatsomeprivateequityfirmsarebecomingspecializedinthe
cosmeticsandtoiletriesindustry,buyingbrandsorcompanies,andutilizingformidable
expertise in finance, marketing, and distribution to compete with the stalwart
manufacturingfirms.Thistrendisgainingmomentumandisexpectedtocontinueinto
theforecastperiod.
The privateequity firms employ aggressive strategies of either acquiring brands with
known names but that have received weak support from the parent company, or
sometimesbuildingbrandsfromscratch.
In 2012, Yellow Wood Partners, a private equity firm acquires Parfums de Coeur, a
previouslyprivatelyheldcompany,foranundisclosedsum.ThecompanyalsobuysIlex
Consumer Product Group in December 2012, which includes Calgon and The Healing
Garden.Thistypeofactivitywillcontinuethroughtheforecastperiod.
ValeantPharmaceuticalsisexpectedtorapidlyincreaseitspresenceincosmeticsand
toiletries over the forecast period, starting with a dynamic 2012. The company has
purchased15companiessince2010.InDecember2012itacquiresMedicis,whichhas
theRestylanebrandofinjectiblefillers,for$2.65billion,aswellasAmbiSkinCarefrom
Johnson & Johnson. Valeant acquires Obagi Medical Products in April 2013 for
$417million, and Bausch & Lomb in May 2013 for $8.7 billion. While the latter
companyisnotpresentinthebeautyindustry,itillustratesValeantspurchasingpower
andseriousfocusonmajoracquisitions.
Increasemediaexpendituresandinnovativemarketingstrategies
theobviousstepstogainsalesandstayafloatinthecompletion
Several leading marketers are likely to increase traceable media expenditures (TME) to
supportnewproductintroductionsandexistingproductportfolio.
Mostmarketerswillcontinuetoallocatethemajorityoftheirmediaexpendituresfor
theirnewproductlaunches.
Television and print media will continue to be the most preferred channel of
advertisingbymarketersovertheforecastperiod.
Most of the leading marketers will continue to evolve their marketing techniques
duringtheforecastperiodandadapttechniquestotherapidlydevelopingsocialdigital
market place, and offer consumers a more personalized and dynamic approach. This
willallowthemarketerstoreducetheiradvertisingexpenditureswhileimprovingthe
shoppingexperienceforconsumers,bothonlineandatthecounter.
Severalmajormultinationalcompanies,includingEsteLauderandProcter&Gamble,
will emphasize on digital and television advertising in order to reach and attract
consumersfromthemassmarket.
229
230
ExecutiveSummary
Additionally,theevolutionofthedigitalmediaintherecentyearswillallowmarketers
toreachouttoawidersetofconsumersforconsiderablyfewerdollars,comparedwith
traditionaladvertisingmethods.
Digitalmedia,andparticularlysocialmedia,willcontinueplayaprominentroleinthe
marketingandpromotionalstrategyformostofthecompanies,andthemarketerswill
introducenewsocialmediaandecommercecampaignsforalmosteachofitsbeauty
brands.
MostoftheleadingcompanieswillutilizesocialmediasitessuchasFacebook,Tumblr,
YouTube,Pinterest,andTwittertoengagewithconsumersandpromotetheirproducts,
orwhicheversitesthatbecomesmorepopularintheforecastperiod.
Duringthecourseoftheforecastperiodending2017,EsteLauderisexpectedtodrive
its HighTouch services to new digital heights. This will help the company to connect
with the consumers in a more personal manner beyond expectations in order to
benefititssalesgrowth.
In2012,LOrallaunchesafemalecentricXboxapplicationtokeepfemaleconsumers
engaged with its brands. These types of interdisciplinary innovations are to be
expectedinthefuture.
4A30
IndustryAnalysis
SectionThree
IndustryAnalysis
SectionThreeof
ContinuingService
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KlineMarketResearch
+19734353412
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4A4
TABLEOFCONTENTS
Page
THEMARKET........................................................................................................................31
Countryoverview.............................................................................................................31
Cosmeticsandtoiletriesoverallperformance.................................................................31
Growth.............................................................................................................................32
Unitvolume......................................................................................................................38
Retailvalueandtrademargins......................................................................................310
COMPANIES........................................................................................................................313
Structureoftheindustry................................................................................................313
Growth...........................................................................................................................318
Companydevelopments................................................................................................320
CONSUMERRESEARCH.......................................................................................................327
Haircare.........................................................................................................................327
Skincare.........................................................................................................................332
Fragrances......................................................................................................................338
Oralcareproducts.........................................................................................................340
Othertoiletries...............................................................................................................341
RETAILDISTRIBUTION.........................................................................................................361
Outletdefinitions...........................................................................................................361
Salesbyretailoutlet......................................................................................................363
PRIVATELABELACTIVITY....................................................................................................371
MARKETINGACTIVITY........................................................................................................377
Traceablemediaexpenditures......................................................................................377
Promotions.....................................................................................................................387
OUTLOOK...........................................................................................................................389
Growthtrends................................................................................................................389
Basecase(mostlikely)unitanddollarforecaststo2017.............................................390
REPRODUCTIONORDISCLOSUREFORBIDDEN;SEESPECIALNOTICE KLINE&COMPANY, INC.
TABLEOFCONTENTS
(Continued)
Page
KLINESFUTUREVIEWSCENARIOFORECASTINGMODEL
FORTHEU.S.COSMETICSANDTOILETRIESMARKET.........................................................397
Methodology..................................................................................................................397
Industrylevelfactors.....................................................................................................397
Macroeconomicfactors.................................................................................................399
Overallcosmeticsandtoiletriesindustry......................................................................399
Fragrances....................................................................................................................3100
Haircareproducts........................................................................................................3101
Makeupproducts.........................................................................................................3101
Oralcareproducts.......................................................................................................3102
Skincareproducts........................................................................................................3103
Othertoiletries.............................................................................................................3103
4A2
THEMARKET
COUNTRYOVERVIEW
The United States has a territory of approximately 9.8million sq km and more than
313millioninhabitants.
Itisthelargestandmostpowerfuleconomyintheworld.
Table31:KeyStatisticsfortheUnitedStates
Characteristic
Value
Geographicsize
9.8millionsqkm
Population
313.1million
Populationgrowth
0.9%
Grossdomesticproduct
$15.7trillion
GDPgrowth
2.2%
Inflationrate
SOURCE:CIAWorldFactbook2012.
2.0%
The United States is a constitutionbased federal republic consisting of 50 states and one
districtcapital,WashingtonD.C.
Thecountryhasamultipartypoliticalsystemwithdemocraticelections.
TheUnitedStatesstillenjoysapowerfulandtechnologicallyadvancedeconomy.
The Federal Reserve maintains an easy monetary policy in spite of the economy
operatingbellowsitspotential.
The U.S dollar maintains its position in spite of the European turmoil and weaker
growthrateinthedevelopingcountries.
Oil prices weaken considerably on account of concerns relating to the Iranian Oil
embargo.
Thejobgrowthrateisgoodataround175,000permonth.
Housing has become highly affordable and reasonably priced and it is estimated that
there is soon going to be an undersupply, which will help many industries such as
constructionreturntostronggrowth.
COSMETICSANDTOILETRIESOVERALLPERFORMANCE
SalesofthecosmeticsandtoiletriesmarketintheUnitedStatesreach$40.4billionin2012,
increasingat3.4%from$39.0billionin2011.
Theindustryhasgrownatacompoundannualgrowthrate(CAGR)of2.1%since2007.
32
TheMarket
Table32:IndustrySalesGrowthofCosmeticsandToiletriesin
theUnitedStates,2007to2012
Year
$Millionr
Change,%
2007
36,363
2008
36,643
0.8
2009
36,337
(0.8)
2010
37,321
2.7
2011
39,026
4.6
2012
40,372
3.4
rRestated.
Manufacturers sales for the individual product categories range from $163 million for
depilatories,waxes,andbleachesto$6,645millionforfacialtreatmentsin2012.
GROWTH
Rising consumer confidence, significant promotional activity, multibenefit products,

technological advancements, and innovative marketing and promotional strategies help
industrysalesreboundin2012.
Skincarecontinuestobethelargestproductclassduring2012,withashareof25.8%
ofthemarket.Thetopthreeproductclassesaccountforalmosttwothirdsofthetotal
industrysales.
Themakeupproductsclasspoststhehighestgrowthat4.3%,followedbytheskincare
productclassat4.1%.
Salesofskincareproductsgrow4.1%to$10,433millionin2012,upfrom$10,021millionin
2011.
Antiagingremainsthemajorthrustofthefacialtreatmentscategory.
While serums in facialtreatment products have been popular for thepast few years,
2012 sees the launch of serums specifically for the eye area to be used with an eye
cream.
Facial treatment marketers are getting bolder about touting product benefits, which
getsnoticedbytheFDA.
Hand and body lotions enriched with antiaging benefits continue to be a prominent
trend.
The availability of hand and body lotions in a variety of exotic fragrances is a
significantlygrowingtrend.
Thesuncarecategorysgrowthisdrivenbyanincreasingawarenessamongconsumers
abouttheharmfuleffectsoftheskinsexposuretothesunrays.Mensfacialskincare
representsahighgrowthopportunityformarketers.
ThepracticallyflatbirthrateintheUnitedStateshasadetrimentaleffectonthebaby
careproductscategoryssales,butnaturalproductsdoparticularlywell.
4A2
TheMarket
Salesofthemakeupproductclassreach$7,657millionatthemanufacturerslevelin2012,
up4.3%from$7,341millionin2011.
In the eye makeup category, the most dramatic growth comes from eyeliner and
eyebrow products as women strive for eyes that communicate sex appeal, with
dramaticeyelinerandaccentuatedeyebrows.
In2012,growthinthefacemakeupcategoryisdrivenbythepositiveperformanceof
all the competing product types within the category. The luxury trade class
outperformsallothertradeclasses.Complexionproductscontinuetobeanimportant
componentinwomensmakeupregimenastheystriveforaflawlessfinish.
Concealers grow the fastest in 2012 compared to other face products. There is
excitement in the category with new launches featuring new formulas and/or
applicators. Liquid foundations continue to be popular in 2012 after several years of
powdermineralsattheforefront.Whippedormousseformulasinfoundationsmakea
comebackin2012.
Lipsticksperformbetterthanlipglossesandlipliners,mostlyduetofashiontrendsand
thenewformulasavailableinthemarket.
Inthenailpolishescategory,newcolorscontinuetogatherattentionin2012asmost
marketersexpandtheircolorassortment.
Manufacturers sales of hair care products are $7,610million in 2012, up 2.9% from
Shampoosthatpromotescalphealthgarnerattentionin2012.
Shampoos that provide protection for colored hair and colorenhancement for hair
contributetotheproductclassgrowth.
Productcustomizationisanimportantproducttrendintheconditionerscategory.
In 2012, professional hair coloring products gain more popularity over athome hair
coloringproducts,asmoreconsumersvisitsalons.
Ethnic hair care products that cater to specific hair types and hair concerns, such as
frizzandcurl,controlperformwellinthecategory.
Hair styling products with improved product forms, such as gels, sprays, hard/soft
waxes,andpomadesininnovativepackaginghelpinthecategorysgrowth.
Manufacturerssalesoftheothertoiletriesproductclassareestimatedat$6,602millionin
2012,up3.0%from$6,412millionin2011.
Availabilityofpersonalcleansingproductsinavarietyofforms,suchasbarsoaps,body
washes,andbathadditivesgivesconsumersawidearrayofoptionstochoosefrom.
Clinicalstrengthantiperspirantsanddeodorantscontinuetobeamainstayin2012.
Procter&GamblesOlaydoesexceptionallywellin2012inthedepilatories,waxes,and
bleachesmarket.
The shaving products category continues to be dominated by mass marketers, but
specialty brand Art of Shaving proliferates through a rapid increase of its vertically
integratedmalegroomingsalons.
33
34
TheMarket
Manufacturers sales of oral care products are up 1.6% from $4,184 million in 2011 to
Multibenefittoothpastescontinuetosupportthesalesgainofthecategoryin2012.
Thetoothpastescategoryseesnewentrantstothemarketin2012.
Mouthwashesthatoffermultiplebenefits,suchasteethstrengthening,helpingrebuild
enamel,andpreventingcavities,supportthegrowthofthecategoryin2012.
Salesinthedentureproductscategoryarealsosupportedbytheagingpopulation,who
needtoreplacelostteeth.
Sales for the lip balms, jellies, and treatments category increase because consumers
purchase new innovative lip balm products that provide multiple benefits, such as
antioxidantsandsunprotection.
Thetoothwhiteningcategoryisbecomingmatureandfacesintensecompetitionfrom
multibenefit toothpastes and the mouthwashes category, thereby leading to a sales
declinein2012.
Total manufacturers sales of fragrances grow by 3.9% from $3,675million in 2011 to

$3,818millionin2012,withincreasesacrossboththemensandwomenscategories.
Sales of fragrances for women increase by 4.0% to $2,717million, while sales of
fragrancesformenincreaseby3.6%to$1,101millionin2012.
Thegrowthofthewomensfragrancescategorycontinuestobedependentonholiday
sales.
Additionally,anincreaseinforeigntouristswhousefragrancesonaregularbasisfindit
lessexpensivetopurchaseintheUnitedStatesthanintheirhomeland,alsohelpsgrow
thecategoryssales.
Thefragrancesformencategorycontinuestoexhibitlowgrowthin2012.Salesgrow
3.6%duringtheyear,from$1,063millionin2011to$1,101millionin2012.
The fragrances for men category struggles most in 2012, affected by Superstorm
Sandyandothercalamities.Thesuccessofthefragrancescategoryistiedveryclosely
totheholidaysellingseason,andsincetumultuouseventsoccurredinthelastquarter,
salesweregreatlyhamperedupuntilafewdaysbeforeChristmas.
4A4
TheMarket
Table33:U.S.DollarSalesofCosmeticsandToiletriesbyProductCategory,2007to2012
Productcategory
SKINCAREPRODUCTS
Facialtreatments
Handandbodylotions
Suncareproducts
Babycareproducts
Totalr
MAKEUPPRODUCTS
Facemakeup
Eyemakeup
Nailpolishes
Totalr
HAIRCAREPRODUCTS
Shampoos
Conditioners
Totalr
OTHERTOILETRIES
Shavingproducts
Totalr
ORALCAREPRODUCTS
Toothpastes
Mouthwashes
Toothbrushes
Dentureproducts
Totalr
FRAGRANCES
Fragrancesforwomen
Fragrancesformen
Total
TOTALr
rRestated.
2007
2008
5,763
2,160
769
286
143
9,121
2,507
2,133
1,397
305
6,342
2,311
1,713
1,561
1,277
316
7,178
3,473
1,869
345
136
5,823
5,928
2,172
844
278
151
9,373
2,537
2,200
1,311
307
6,355
2,307
1,695
1,561
1,291
304
7,159
3,558
1,915
336
139
5,948
1,622
735
726
337
320
273
4,013
2,706
1,180
3,886
36,363
1,693
779
730
351
320
281
4,154
2,546
1,108
3,654
36,643
$Million
2009
2010
2011
2012
5,860
6,091
6,360
6,645
2,192
2,208
2,240
2,283
860
933
984
1,048
278
278
283
288
146
143
154
169
9,336
9,653 10,021 10,433
2,549
2,655
2,804
2,909
2,304
2,431
2,621
2,709
1,252
1,248
1,352
1,377
341
406
564
662
6,446
6,740
7,341
7,657
2,276
2,361
2,501
2,620
1,632
1,650
1,658
1,680
1,497
1,525
1,578
1,653
1,257
1,280
1,323
1,317
314
328
333
340
6,976
7,144
7,393
7,610
3,686
3,792
3,907
4,026
1,911
1,942
1,999
2,040
341
348
362
373
138
135
144
163
6,076
6,217
6,412
6,602
1,682
761
725
342
319
285
4,114
2,379
1,010
3,389
36,337
1,668
759
718
347
320
287
4,099
2,444
1,024
3,468
37,321
1,719
782
725
357
314
287
4,184
2,612
1,063
3,675
39,026
1,749
799
741
374
318
271
4,252
2,717
1,101
3,818
40,372
35
36
TheMarket
Table34:CategorieswithDollarGrowthGreaterthantheIndustry
Average,2012
Productcategory
Change,%
Nailpolishes
17.4
13.2
9.7
Suncareproducts
6.5
Shampoos
4.8
Conditioners
4.8
4.8
Facialtreatments
4.5
Fragrancesforwomen
4.0
Facemakeup
3.7
Fragrancesformen
3.6
Table35:U.S.ManufacturersDollarSalesandGrowthofCosmeticsandToiletriesbyProduct
Category,2011and2012
$Million
Productcategory
2011
2012
Change,%
Facialtreatments
6,360
6,645
4.5
3,907
4,026
3.0
Facemakeup
2,804
2,909
3.7
Fragrancesforwomen
2,612
2,717
4.0
Eyemakeup
2,621
2,709
3.4
Shampoos
2,501
2,620
4.8
Handandbodylotions
2,240
2,283
1.9
1,999
2,040
2.1
Toothpastes
1,719
1,749
1.7
1,658
1,680
1.3
Conditioners
1,578
1,653
4.8
1,352
1,377
1.8
1,323
1,317
(0.5)
Fragrancesformen
1,063
1,101
3.6
Suncareproducts
984
1,048
6.5
Mouthwashes
782
799
2.2
Toothbrushes
725
741
2.2
Nailpolishes
564
662
17.4
(Continued)
4A6
TheMarket
Table35:U.S.ManufacturersDollarSalesandGrowthofCosmeticsandToiletriesbyProduct
$Million
Productcategory
2011
2012
357
374
4.8
Shavingproducts
362
373
3.0
333
340
2.1
Dentureproducts
314
318
1.3
Babycareproducts
283
288
1.8
287
271
(5.6)
154
169
9.7
144
163
13.2
39,026
40,372
3.4
Totalr
rRestated.
Change,%
Table36:U.S.ManufacturersSalesofCosmeticsandToiletriesbyProductCategoryAccordingto
ChangeinValue,2011and2012
$Million
Productcategory
2011
2012
Nailpolishes
564
662
17.4
144
163
13.2
154
169
9.7
Suncareproducts
984
1,048
6.5
Shampoos
2,501
2,620
4.8
Conditioners
1,578
1,653
4.8
357
374
4.8
Facialtreatments
6,360
6,645
4.5
Fragrancesforwomen
2,612
2,717
4.0
Facemakeup
2,804
2,909
3.7
Fragrancesformen
1,063
1,101
3.6
Eyemakeup
2,621
2,709
3.4
3,907
4,026
3.0
Shavingproducts
362
373
3.0
Mouthwashes
782
799
2.2
Toothbrushes
725
741
2.2
1,999
2,040
2.1
(Continued)
Change,%
37
38
TheMarket
Table36:U.S.ManufacturersSalesofCosmeticsandToiletriesbyProductCategoryAccordingto
$Million
Productcategory
2011
2012
333
340
2.1
Handandbodylotions
2,240
2,283
1.9
1,352
1,377
1.8
283
288
1.8
Toothpastes
1,719
1,749
1.7
Hairstylingproductsandspraysr
1,658
1,680
1.3
314
318
1.3
1,323
1,317
(0.5)
287
271
(5.6)
39,026
40,372
3.4
Babycareproducts
Dentureproducts
Totalr
Change,%
rRestated.
The nail polishes category is the fastest growing category in the cosmetics and toiletries
marketin2012withagrowthof17.4%.
Thedepilatories,waxes,andbleachescategoryisthesecondfastestgrowingcategory
withagrowthof13.2%.
In2012,onlyfourofthe26categoriespostagrowthhigherthan5.0%,whiletheother
10categoriespostagrowthbetween1.0%and3.0%.
Tencategorieswitnessagrowthbetween3.0%and5.0%.
Haircoloringproductsandtoothwhiteningproductsarethetwoproductcategorieswhich
experiencesalesdeclinesin2012.
UNITVOLUME
In2012,unitsalesincreaseby2.6%from9,639.3millionpackagesin2011to9,887.5million
packages.
Amongthe26productcategoriesprofiledinthisstudy,24productcategoriesregisterunit
growthin2012.
Theremainingtwocategories,haircoloringandtoothwhiteningproducts,experience
adeclinein2012.
Thenailpolishesandthedepilatories,waxes,andbleachescategoriesregisterdoubledigit
growthinunitvolumein2012.
4A8
TheMarket
Personal cleansing products remains the leading category in terms of unit volume at
1,663millionpackages,or16.8%oftheindustrystotalunitvolume,in2012.
Toothpastes, deodorants and antiperspirants, shampoos, facial treatment products,
hair styling products and sprays, and eye makeup are the other categories that have
largeunitvolumes.
Table37:UnitSalesofCosmeticsandToiletriesbyGrowth,2011and2012
Millionpackages
Productcategory
2011
2012
Change,%
Nailpolishes
202.2
234.6
16.0
29.4
33.2
12.9
17.3
18.9
9.3
154.6
165.0
6.7
Suncareproducts
230.6
244.8
6.2
Facemakeup
405.2
421.4
4.0
Conditioners
426.5
443.0
3.9
Shampoos
713.5
741.0
3.9
Fragrancesforwomen
155.0
160.0
3.2
Dentureproducts
85.4
88.0
3.0
Shavingproducts
232.0
238.3
2.7
Facialtreatments
655.2
670.0
2.3
1,629.0
1,663.0
2.1
Eyemakeup
514.7
524.9
2.0
Mouthwashes
188.5
192.0
1.9
81.2
82.6
1.7
Handandbodylotions
506.1
514.2
1.6
877.7
891.2
1.5
97.8
99.3
1.5
Toothpastes
990.5
1,005.0
1.5
Toothbrushes
344.3
349.0
1.4
235.1
237.5
1.0
523.5
528.7
1.0
99.4
99.9
0.5
227.3
225.0
(1.0)
17.4
17.0
(2.3)
9,639.3
9,887.5
2.6
Babycareproducts
Fragrancesformen
Totalr
39
310
TheMarket
Table38:UnitSalesofCosmeticsandToiletriesasaPercentageofTotal,2012
Productcategory
Millionpackages
%Oftotal
1,663.0
16.8
Toothpastes
1,005.0
10.2
891.2
9.0
Shampoos
741.0
7.5
Facialtreatments
670.0
6.8
528.7
5.3
Eyemakeup
524.9
5.3
Handandbodylotions
514.2
5.2
Conditioners
443.0
4.5
Facemakeup
421.4
4.3
Toothbrushes
349.0
3.5
Suncareproducts
244.8
2.5
Shavingproducts
238.3
2.4
237.5
2.4
Nailpolishes
234.6
2.4
225.0
2.3
Mouthwashes
192.0
1.9
165.0
1.7
Fragrancesforwomen
160.0
1.6
Fragrancesformen
99.9
1.0
99.3
1.0
Dentureproducts
88.0
0.9
Babycare
82.6
0.8
33.2
0.3
18.9
0.2
17.0
0.2
9,887.5
100.0
Total
RETAILVALUEANDTRADEMARGINS
Total retail sales in the cosmetics and toiletries business are valued at approximately
$60.1billionin2012.
Theaveragetrademarginforthecosmeticsandtoiletriesindustryis32.8%.
TrademarginsarediscussedindetailintheRetailChannelssectionofthischapter.
4A10
TheMarket
Among the 26 product categories covered in this study, eight categories have an average
trademarginhigherthantheindustryaverageof32.8%.
Facialtreatmentscontinuetohavethehighestaveragetrademarginof38.9%in2012.
Toothbrushescontinuetohavethelowestaverageretailmarginof18.3%.
Table39:U.S.SalesofCosmeticsandToiletriesbyProductCategory,RankedbyTradeMargin,2012
$Million
Productcategory
Manufacturerssales
Facialtreatments
6,645
10,870.6
38.9
Fragrancesforwomen
2,717
4,362.6
37.7
Fragrancesformen
1,101
1,730.5
36.4
169
265.0
36.2
1,377
2,119.3
35.0
Facemakeup
2,909
4,469.9
34.9
Eyemakeup
2,709
4,122.2
34.3
Conditioners
1,653
2,470.7
33.1
Handandbodylotions
2,283
3,389.2
32.6
1,680
2,481.1
32.3
Suncareproducts
1,048
1,545.0
32.2
Shampoos
2,620
3,843.6
31.8
4,026
5,871.8
31.4
Nailpolishes
662
958.4
30.9
Shavingproducts
373
538.2
30.7
Babycareproducts
288
412.3
30.1
340
486.0
30.0
2,040
2,836.0
28.1
Dentureproducts
318
441.3
27.9
163
222.7
26.8
271
359.3
24.6
Mouthwashes
799
1,035.4
22.8
374
481.5
22.3
1,317
1,677.7
21.5
Toothpastes
1,749
2,161.9
19.1
741
907.4
18.3
40,372
60,059.6
32.8
Toothbrushes
Total
Retailsales
Trademargin,%
311
312
TheMarket
4A12
COMPANIES
STRUCTUREOFTHEINDUSTRY
The cosmetics and toiletries industry is very competitive, with over 1,000 companies
manufacturingandmarketingmorethan20,000brandsinthe26majorproductcategories
coveredinthisreport.
The top 10 cosmetics and toiletries marketers represent 61.9% of total industry sales in
2012.
Nineoutof10ofthesemarketerscosmeticsandtoiletriessalesareestimatedatmore
than$1billioneach.
Procter& Gamble continues to be the undisputed market leader, representing 14.4%
oftotalU.S.cosmeticsandtoiletriessalesin2012.
LOralretainsitssecondposition,with11.3%oftotalindustrysalesin2012.
Unilever continues to be the third leading marketer in the cosmetics and toiletries
market,with8.8%ofindustrysalesin2012.
Este Lauder follows in the fourth position, with 6.7% of the total cosmetics and
toiletriesmarketsales.
Infifthposition,Johnson&Johnsonscontributes5.0%ofthecosmeticsandtoiletries
industrysalesin2012.
Table310:ManufacturersSalesoftheTop10CosmeticsandToiletries
CompaniesintheUnitedStates,2012
Rank
Company
$Million
2011
2012
Procter&Gamble
5,824
L'Oral
4,551
Unilever
3,546
EsteLauder
2,722
Johnson&Johnson
2,020
LimitedBrands
1,785
ColgatePalmolive
1,493
Coty
1,086
MaryKay
1,063
948
10
10
Allother
16,282
Total
40,372
Avon
314
Companies
Procter& Gamble has maintained a strong presence in the industry and retains its top
position in the cosmetics and toiletries market over the years. The company has a strong
presenceacrossallmajorproductclasses.
Procter& Gamble is among the top five marketers in each of the six product classes
profiledin2012.
LOral is the leading marketer in the makeup products class and the second leading
marketer in the hair care product class. The marketer continues to focus on major
industrytrendstoensuredemandforitsproducts.
Unilever is the leading marketer in the other toiletries product class in 2012. The
companybenefitsfromitsloyalconsumerbaseinthemassmarket.
Este Lauder is the secondleading marketer in the skin care and makeup product
classesin2012.
Johnson& Johnson is the leading marketer in the skin care product class, and the
companyalsoenjoysdominanceintheoralcareproductclass.
In 2012, sales of Avon decline due to various factors, such as business restructuring,
declineinthetotalnumberofactiverepresentatives,warningfromtheFDAregarding
fewvariantsoftheAnewproductline,andtalksofapossiblebuyoutofthecompany.
Mostoftheleading29majorcompaniesinthisreporthaveaglobalpresence.
Formostofthecompanies,theU.S.cosmeticsandtoiletriessalesmarketaccountsfor
averysmallportionoftheirglobalsales.
Marketers such as Unilever, ColgatePalmolive, and Procter & Gamble are global
players in consumerpackaged goods and have sales coming from many countries
aroundtheglobe.
Beiersdorf, Clarins, GlaxoSmithKline, Henkel, LVMH, Shiseido, and Kao are all
headquarteredoutsidetheU.S.market.WhilesalesfromEuropecontinuetoregistera
majorportionoftotalsalesforBeiersdorfandHenkel,LVMHnowhastherestofAsia
(besidesJapan)asitslargestmarket,followedbytheUnitedStatesandthenEurope.
Companies such as GlaxoSmithKline, Merck, and Sanofi generate a majority of sales
fromtheirpharmaceuticalbusiness.
CombeandRevlonsU.S.cosmeticsandtoiletriessalesaccountformorethan50.0%of
the companys total sales in 2012. Mary Kay follows in the third place, with the U.S
cosmeticsandtoiletriessalesaccountingfor35.4%ofthemarketerstotalglobalsales.
Onlyfivecompaniesearnlessthan3.0%oftheircosmeticsandtoiletriesrevenuesfrom
theU.S.region.TheseareMerck,GlaxoSmithKline,Sanofi,LVMH,andAlticor.
4A14
Companies
Table311:U.S.SalesofCosmeticsandToiletriesfor
LeadingCompanies,2012
Company
$Million
Procter&Gamble
5,824
L'Oral
4,551
Unilever
3,546
EsteLauder
2,722
Johnson&Johnson
2,020
LimitedBrands
1,785
ColgatePalmolive
1,493
Coty
1,086
MaryKay
1,063
Avon
948
Revlon
814
GuthyRenker
737
Henkel
635
Shiseido
542
Kao
525
Chanel
461
GlaxoSmithKline
407
EnergizerHoldings
396
Beiersdorf
344
LVMH
337
Church&Dwight
313
ElizabethArden
290
Merck
209
Sanofi
197
Alticor
176
TheCloroxCompany
172
Clarins
171
Combe
157
HelenofTroy
147
Allother
8,304
Total
40,372
315
316
Companies
Table312:EstimatedU.S.SalesofCosmeticsandToiletriestoTotalSalesforLeadingCompanies,
2012
$Million
U.S.cosmeticsand
toiletriessales
Company
157
220
71.4
Revlon
814
1,426
57.1
MaryKay
1,063
3,000
35.4
EsteLauder
2,722
9,714
28.0
737
2,600
28.3
1,086
4,611
23.6
290
1,238
23.4
LimitedBrands
1,785
10,459
17.1
L'Oral
4,551
28,869
15.8
Chanel
461
3,100
14.9
HelenofTroy
147
1,182
12.4
Church&Dwight
313
2,922
10.7
Clarins
171
1,671
10.2
Avon
948
10,717
8.8
ColgatePalmolive
1,493
17,085
8.7
EnergizerHoldings
396
4,567
8.7
Procter&Gamble
5,824
83,680
7.0
Unilever
3,546
51,324
6.9
Shiseido
542
8,553
6.3
Beiersdorf
344
7,762
4.4
Kao
525
15,243
3.4
TheCloroxCompany
172
5,468
3.1
Henkel
635
21,218
3.0
2,020
67,224
3.0
Alticor
176
11,300
1.6
GlaxoSmithKline
407
41,887
1.0
LVMH
337
36,117
0.9
Sanofi
197
44,913
0.4
Merck
209
47,267
0.4
32,068
543,474
5.9
Coty
ElizabethArden
Johnson&Johnson
Total
4A16
%Oftotalsales
Combe
GuthyRenker
Totalsales
317
Companies
Table313:ManufacturersSalesofMajorProductClassesofCosmeticsandToiletriesintheUnitedStatesby
MajorCompany,2012
$Million
Company
Makeup
Haircare
Othertoiletries
Oralcare
Fragrances
Total
Alticor
82
94
176
Avon
316
317
17
92
202
948
Beiersdorf
265
60
16
344
79
138
244
461
Chanel
Church&Dwight
111
202
313
92
27
51
171
ColgatePalmolive
636
851
1,493
Combe
127
20
157
Coty
58
415
72
541
1,086
ElizabethArden
52
23
215
290
230
166
396
1,112
1,158
170
12
262
2,722
406
407
GuthyRenker
526
42
169
737
HelenofTroy
85
47
147
Henkel
67
565
635
1,210
99
171
131
409
2,020
Kao
273
195
57
525
LimitedBrands
582
94
33
409
15
652
1,785
L'Oral
814
1,814
1,508
16
397
4,551
LVMH
69
155
113
337
MaryKay
550
431
11
17
54
1,063
Merck
209
209
Procter&Gamble
637
723
1,612
1,186
1,357
309
5,824
Revlon
601
152
52
814
Sanofi
76
51
66
197
114
363
26
39
542
68
37
58
172
323
1,311
1,892
14
3,546
7,752
6,494
5,703
5,563
3,437
3,119
32,068
Clarins
EnergizerHoldings
EsteLauder
GlaxoSmithKline
Johnson&Johnson
Shiseido
TheCloroxCompany
Unilever
Total
Skincare
318
Companies
Makeup products remains the strongest product class among the leading 29 companies,
representing84.8%ofthecompaniestotalindustrysalesin2012.
Othertoiletriesisthesecondstrongestproductclass,representing84.3%oftotalsales
in2012forthetop29companies.
The skin care product class has the least penetration from the major 29 companies,
witha74.3%penetrationin2012.
Table314:ManufacturersSalesbyProductClassofMajorCompanies,2012
Productclass
$Million
Top29companies
Total
%Majorcompaniestototal
Makeup
6,494
7,657
84.8
Othertoiletries
5,563
6,602
84.3
Oralcare
3,437
4,252
80.8
Fragrances
3,119
3,818
81.7
Haircare
5,703
7,610
74.9
Skincare
7752
10,433
74.3
32,068
40,372
79.4
Total
GROWTH
Manufacturers sales of the U.S. cosmetics and toiletries market grow 3.4% to
approximately$40.4billionin2012,upfrom$39.0billionin2011.
Consumers continue to be valueoriented, but are recently willing to pay more for
productsthatcanofferspecificbenefits.
Outofthetop29companiesprofiledinthisreport,fivemarketersregisterasalesdecline,
andtheremaining24companiesregisterasalesgainin2012.
GuthyRenker, a leading direct response television marketing company, registers the
highestgrowthat19.6%in2012,withsalesat$737millionin2012from$616millionin
2011.Itscostsareknowntobeexorbitantlyhighduetopayingcelebrityendorsersand
producingandairinginfomercials.
Chanel,aprestigecompany,registersthesecondhighestgrowthat10.6%,withsales
at $461million in 2012 up from $417 million in 2011. Chanels classic perfumes are
amongthebestperformersinthecategory.
LVMH shows the thirdhighest growth at 9.8% in 2012 to reach $337 million in 2012
from$307millionin2011.LVMHsbrandsofmakeupandperfumes,includingChristian
Dior,ridethewaveofsuccessintheluxurytradeclass.
TheCloroxCompanyandMerckaretiedinthefourthpositionwithagrowthof8.9%in
2011. Cloroxs Burts Bees is becoming an industry standard for accessibly priced
naturalproducts.
Amongthemajor29companies,16companiesregistersalesgrowthgreaterthanthe
industryaverageof3.4%in2012.
Helen of Troy records the highest decline among the top 29 companies, with sales
declining8.1%from$160millionin2012to$147millionin2012.
4A18
Companies
Table315:U.S.SalesofCosmeticsandToiletrieswithPercentageGrowthforLeading
Companies,2011and2012
$Million
Company
2011
2012
GuthyRenker
616
737
19.6
Chanel
417
461
10.6
LVMH
307
337
9.8
TheCloroxCompany
158
172
8.9
Merck
192
209
8.9
Alticor
164
176
7.3
Clarins
160
171
6.9
EsteLauder
2,569
2,722
6.0
L'Oral
4,304
4,551
5.7
LimitedBrands
1,706
1,785
4.6
EnergizerHoldings
379
396
4.5
ColgatePalmolive
1,431
1,493
4.3
504
525
4.2
3,406
3,546
4.1
392
407
3.8
1,048
1,086
3.6
Shiseido
527
542
2.8
Beiersdorf
335
344
2.7
1,979
2,020
2.1
154
157
1.9
1,047
1,063
1.5
Revlon
802
814
1.5
Sanofi
194
197
1.5
Henkel
626
635
1.4
5,898
5,824
(1.3)
321
313
(2.5)
1,014
948
(6.5)
ElizabethArden
313
290
(7.3)
HelenofTroy
160
147
(8.1)
7,903
8,304
5.1
39,026
40,372
3.4
Kao
Unilever
GlaxoSmithKline
Coty
Johnson&Johnson
Combe
MaryKay
Procter&Gamble
Church&Dwight
Avon
Allother
Total
Change,%
319
320
Companies
COMPANYDEVELOPMENTS
Someofthekeydevelopmentsfromthetop29companiesareasfollows.
Thecosmeticsandtoiletriesindustrycontinuestoconsolidate,therebymakingitmore
difficultforsmallermarketerstooperateindependently.
The acquisition of smaller companies by global corporations opens new doors and
greater investment in research and development for smaller companies, which are
oftenfacedwithlimitedfinancialresources,andhelpthembringnewandinnovative
productstoconsumers.
The year 2012 sees a flurry of merger and acquisition deals globally, with the United
Statesnoexception.
In2012,marketersfindthemselvesembroiledinlegalcomplaintsandlawsuits.
Este Lauders MAC Cosmetics wins a $90 million judgment against Chinese cyber
squatters selling counterfeit MAC beauty products. The lawsuit was filed against
TingtingChen,LimeiWeng,andZhangGuithe,andotherswhooperated112websites
including, themaccosmetics.com, mac2wholesale.com, maccosmeticworld.com,
wholesalemacmakeup.com, and cheapmakeuppick.com.The judge ordered for any
fundsfoundsinthepaypalaccountattachedtotheinfringingsitestobegiventoEste
Lauder. Additionally, third party providers such as online businesstobusiness selling
platforms,backendserviceproviders,searchengines,webdesigners,internetservice
providers, domain name registrars, and shippers to stop all services to the Chinese
cybersquatters.
In 2012, Christiansen Davis Bullock, a Texasbased firm files a complaint against
Unileverwithrespecttoafalse,deceptive,andmisleadingclaiminconnectionwiththe
Suave Professional Keratin Infusion 30 Day Smoothing Kit. Unilever discontinues the
productandrecalleditfromtheretailstores.
In2012,MaryKaytakesluxurydesigner,MichaelKorstocourtforbreachofcontract
and trademark infringement. According to Mary Kay, Michael Kors has registered a
cosmetics line with the same trademark initials as itself. The first filing with the U.S.
Patent and Trademark Office includes the MK with a circle around the letter while
thesecondfilingincludesMichaelKorsonthebottomborderofthecircle.According
toMaryKay,theagreementstatesthatMichaelKorscannotuseMKallbyitself,orin
closeproximitytoMichaelKorsorinrelationwithanyproductswhatsoever.
In June 2012, Revlon settles its dispute with shareholder Fidelity Management &
Researchregardingaclassactionlawsuitrelatedtoashareexchangeofferfrom2009.
In August 2012, Procter & Gamble files a complaint to the NAD (National Advertising
Division)intheUnitedStatesagainstColgatePalmoliveregardingtheusageofcertain
claimsforitsOpticWhiterangeoforalcareproducts.TheNADhassuggestedColgate
Palmolive to stop advertising some claims for its whitening toothpastes including
Samewhiteningingredientasstrips.
4A20
Companies
InSeptember2012,FDAwarnsLOraloverclaimsforantiagingproductsbyissuinga
warninglettertothecompany.Intheletter,FDAclaimsthat11ofthecompanysskin
care products can be classified as drugs as they serve the purpose of changing the
structureoranyfunctionofthehumanbody.Theseproductsinclude:GenifiqueYouth
Activating Concentrate, Genifique Eye Youth Activating Eye Concentrate, Genifique
CreamSerumYouthActivatingCreamSerum,GenifiqueRepairYouthActivatingNight
Cream,AbsoluePreciousCellsAdvancedRegeneratingandReconstructingCreamSPF
15 Sunscreen, Absolue Eye Precious Cells Advanced Regenerating and Reconstructing
Eye Cream, Absolue Night Precious Cells Advanced Regenerating and Reconstructing
NightCream,andRenergieMicroliftEyeR.A.R.EIntenseRepositioningEyeLetter.
In 2012, a number of marketers merge and acquire other brands or companies to

strengthentheirpositioninthemarket.
In 2012, Unilever integrates two acquisitions, Kalina, the Russian Personal Care
Company, and Alberto Culver, the global hair and skin care company. Unilever has
acquired a controlling stake in Kalina for approximately 500 millon. The acquisition
willhelpUnileverboostitspersonalcarebusinessinfastgrowingdevelopingmarkets.
Alsoin2012,HighRidgeBrands,aportfoliocompanyofBrynwoodPartners,acquires
theglobalrightstotheCoastpersonalcleansingproducts,aHenkelbrand.Inaddition,
BrynwoodPartnerspicksupWhiteRain,LALooks,DepSport,ZeroFrizz,ThickerFuller
Hair,Soft&Dri,andPure&Naturalbrandsin2012.
ElizabethArden acquires the CurveFragrance franchise from Fifth & Pacific(formerly
knownasLizClaiborne)foranundisclosedprice.
InMarch2012,Procter&GambleacquiresNewChapterInc.foranundisclosedsum.
NewChapterisaTexasbasedvitaminandsupplementcompany.
In April 2012, Coty proposes to acquire Avon. In May 2012, Avon turns down Cotys
proposalforitsacquisition.
InMay2012,ElizabethArdenacquiresgloballicensesandcontainsassetsassociatedto
the Ed Hardy, True Religion, and BCBG Max Azria fragrance brands from New Wave
Fragrancesforanundisclosedprice.
In June 2012, Elizabeth Arden acquires global permits to the Justin Bieber and Nicki
MinajfragrancebrandsfromGiveBackBrandsforanundisclosedprice.
Revlon acquires brands Pure Ice nail enamel and Bon Bons color cosmetics from Bari
Cosmetics in July 2012. Terms of the transaction are not disclosed; however, Revlon
uses$22millionofborrowingsunderits2011RevolvingCreditFacility,alongwithcash
onhandtofundtheacquisition.
Yellow Wood Partners acquires Parfum de Coeur perfume house in September 2012.
Parfums de Coeur markets Body Fantasies, Designer Imposters, and Bod Man
fragrancesinfood,drugandmasschannels.
In October 2012, Church & Dwight announces that it has completed its previously
announced acquisition of Avid Health for USD 650 million. Avid Health markets
nutritionalsupplements,mostlyinthegummyformat.
In October 2012, LOral USA signs an agreement to acquire Emiliani Enterprises
extendingitscoverageofAmericanhairsalons.
321
322
Companies
InOctober2012,LOralacquirestheVoguemakeupbrandinColombia.
InOctober2012,ColgatePalmoliveandOmronHealthcareenterabroadcooperation
agreementtomarketanddeveloporalcareproductsincludingelectrictoothbrushes.
InNovember2012,LOralacquiresUrbanDecay,specialtymakeupbrandintheU.S.
forapproximately$350million.
InDecember2012,Beiersdorfacquirestheremaining50%ofsharesandvotingrightsin
EBC EczacbaBeiersdorf Kozmetik rnler Sanayi ve Ticaret A.S (Turkey) for 29
million($37million).Atthetimeofacquisition,Beiersdorfpaysafixedcomponentof
25million($32million)incashandacontingentpurchasepricepayableattheoffset
offiscal2014ifcertainperformanceindicatorsaremetin2013.
In December 2012, Galderma, a pharmaceutical company formed as a joint venture
betweenNestleandLOral,acquiresSpirig,aleadingcompanyintheproductionand
developmentofdermatologicalproducts.
ValeantPharmaceuticalsacquiresAmbiSkincarefromJohnson&JohnsoninDecember
2012,andthenObagiMedicalinApril2013.
ItisannouncedinDecember2012thatMarkwinsInternationalhasacquiredPhysicians
FormulaHoldings,for$75.0million.
AlsoinDecember,Dr.FreshacquirestheReachbrandoftoothbrushesfromJohnson&
Johnson.
Afewmarketersdivesttheirbrandsorbusinessesinanattempttoincreasetheircashflow
andfocusonmoreimportantbusinesses.
In May 2012, Procter& Gamble (P&G) divests its snacks business to The Kellogg
Company for $2.7 billion in an allcash transaction. The Kellogg Company is a
multinationalfoodmanufacturingcompanybasedinBattleCreek,MI.Asaresultofthis
change,thePetCarebusinessisnowincludedintheFabricandHomeCaresegment.
ThedivestituremarksProcter&Gamblesexitfromthefoodandbeveragebusiness.
InJuly,2012,UnileverentersintoadefinitiveagreementtoselltoConAgraFoodsits
North American frozen meal business, the brands Bertolli and P.F. Changs. The total
cashconsiderationforthedealis$265million.ThedivestitureiscompletedinAugust,
2012.
In2012,Henkelssubsidiary,theDialCorporation,divestsitsPure&Naturalbrand.The
Pure&NaturalbrandisacquiredbyGoldenSun,asubsidiaryofBrynwoodPartners.
In July 2012, LOral completes the sale of its home care business from the Cadum
GrouptoEauEcarlateSASforanundisclosedsum.
InJuly2012,Sanofiannouncestheexecutionofanagreementaccordingtowhichitwill
divestitsdirectandindirectstakeofaround19.3%intheYvesRocherGroup.
In July 2012, LOral completes the sale of its home care business from the Cadum
GrouptoEauEcarlateSASforanundisclosedsum.
In October 2012, Sanofi and BristolMyers Squibb coannounce the restructuring of
theirlongtermalliancefollowingthelossofexclusivityofPlavixandAvapro/Avalidein
manymajormarkets.
4A22
Companies
The year witnesses marketers milestones, major strategic planning shifts, increase in
infrastructural facilities, partnerships and license agreements, associations with
organizations,sustainableandphilanthropicinitiatives,andothernews.
InJanuary2012,Burt'sBeesofficiallylaunchesanewnaturalbrand,namedGd,under
different categories, including shampoos, conditioners, body washes, body butter,
bodylotion,andhandwashes.Itisaimedatayoungerdemographicdifferentthanits
flagshipbrandBurtsBees.
In January 2012, LOral announces the launch of a website in the United States,
designedtoinspireandempowergirlstopursuecareersinscienceandtechnology.
In February 2012, Procter & Gamble announces its $10 billion productivity and cost
saving plan to decrease costs in areas like supply chain, research and development,
marketingandoverheadexpenses.
In2012,Procter&Gamblecelebratesits175thanniversary.
InFebruary2012,BeiersdorflaunchesEucerinSkinInstitute,anintegratedconceptthat
consistsofscientificskindiagnosisaswellaspersonalconsultationandindividualskin
treatment.
In March 2012, Amway teams with University of Michigan to harness exclusive
patented technology in its skin care products that counters common side effects of
retinolforimprovedresults.
InMarch2012,LOralinauguratesitsGlobalHairResearchCenterinParisSaintOuen,
France.This100millionfacility,builton25,000squaremeterspace,employees500
people.Thiscenterwillbetheheadofaglobalnetworkofsixregionalcenters,andthe
headquartersforthecompanysinternationaldepartmentsofhaircolor,haircareand
hairstyling.
In May 2012, LVMH teams up with the European Commission to promote best
environmentalbehaviorsintheframeworkofGreenWeek2012.
InSeptember2012,ColgatePalmoliveannouncesthatitsagencypartnersY&R,MEC,
VML, Wunderman and GHG are joining forces to create a single operating unit to
engagewithconsumersinrealtimeacrossalltouchpointsandtodriveefficiencies.
InSeptember2012,ElizabethArdenannouncesinvestmentinRedDoorSpaHoldings.
In November 2012, LOral announces major expansion of Kentucky Manufacturing
Plant. The proposed plant expansion includes renovations to the existing plant, new
constructionandthepurchaseofnewequipment.
In June 2012, Shiseido announces a plan to strengthen its U.S. corporate,
manufacturing,anddistributionoperations.Thecompanyannouncesthatitwillalign
theU.S.finance,legal,andhumanresourcesfunctionsofitspremierconsumerbrands;
includingBareEscentuals,BeautePrestigeInternationalUSA,Nars,andShiseidointoan
unified,sharedservicesplatform.In2012,Johnson&JohnsonrecallsitsJohnsonsBaby
ShampooanddiscontinuesitsAveenosorganicHarvestlineofproductsonaccountof
inclusionofharmfulchemicals.
EnergizerHoldingsgetsheatfromreportsoffiveconsumersinNorthAmericacatching
fire from using its Banana Boat UltraMist sunscreens near sparks or flame. It recalls
over20formulationsfromthemarket,blamingthedeliverysystem.Nolawsuitshave
beenfiledasofyet.
323
324
Companies
Johnson&JohnsonsOrganicHarvestlineofshampoolosesitsUSDANationalOrganic
Program (NOP) certification on account of the fact that the products contain
ingredientsthatarenotonthenationallyapprovedlistoforganicingredients.
BurtsBeespartnerswithPreserve,asustainableconsumergoodscompany,todevelop
arecyclablesolutionforitsBurtsBeesLipBalm,TintedLipBalm,LipShimmerTubes,
andBurtsBeesplasticcapsin2012.Thepartnershipisaimedatdivertingplasticfrom
landfills in order to provide material to develop packaging for new products such as
Preservetoothbrushesandrazors.
In2012,EsteLauderentersintoalicenseagreementwithAmericanluxurysportswear
brand, Tony Burch and Milanbased fashion company Marni. These additions will
strengthen the marketers Aramis and Designer Fragrances (ADF) portfolio of brands.
ThelicensingagreementgivesEsteLauderexclusiveglobalrightstomarketfragrances
under the Ermenegildo Zegna Group, as well as develop new product lines in the
groomingsegment.
In2012,HelenofTroyentersintoanagreementtopurchase84acresoflandinOlive
BranchinMississippi.Thelandwillbeusedforthepurposeofconstructinga1.3million
square foot distribution center. The distribution center is expected to cost an
approximate$37millionandwillbeoperationalfromthethirdquarterof2014.
Burts Bees enters into a license agreement with childrens brand builder Ayablu In
2012.
Currently Burts Bees range of baby care products include body washes, bar soaps,
moisturizers, ointments and care, and sun care products. This move sees the brands
expansion into multiple categories including home and lifestyle. The line debuts with
newbornessentialsthatincludeapparel,accessories,bathlinens,andgiftsets
The company debuts this range of products through select Target stores and the
retailerswebsite,target.com.During2012,thecompanygraduallyexpandeditsrange
ofproductstobeavailableatbuybuybabyretailoutletsandBabiesRUs.com.BurtsBees
hasalsolaunchedaportaldedicatedtoitsnewlineofproductsatburtsbeesbaby.com.
In2012,Avoncontinuestofacemanychallenges.
InquiriesaremadeintoallegationsofbriberybythecompanysemployeesinChinaand
othercountries.
InMarch2012,Cotymakesanunsolicited$10billionoffertoacquireAvon,asitplans
toutilizeAvonsstrongsalesforceinemergingmarkets.
InApril2012,AvonrejectsCotys$10billionofferforatakeover.
The$23.25persharebidwasputata20%premiumtoAvonsrecentstockprice.Avon
responded that the valuation was too low, and that Cotys nonbinding bid did not
presentarealoffer.
InMay2012,afterCotysbiddies,sharesofAvonplungeon9.7%.
In October 2012, Avon catches FDAs attention for having infringed guidelines
regardingfivedifferentproductsofitsAnewrange.
FDA claims that its products Anew Clinical Advanced Wrinkle Corrector, Anew
Reversalist Night Renewal Cream, Anew Reversalist Renewal Serum, Anew Clinical
Thermafirm Face Lifting Cream and Solutions Liquid Bra Toning Gel have uses that
apparentlycausethemtobeclassifiedasdrugs.Asaresultofthis,FDAasksAvonto
rectify the violations, while Avon pledges its commitment to abide by the laws and
regulations.
4A24
Companies
Avon outlines initial steps to costcutting, two of which include, global headcount
reductionofapproximately1500positions,anditsexitfromSouthKoreaandVietnam.
In February 2013, Avon declares its fourth quarter 2012 losses deepen as a result of
In March 2013, Avon completes its refinancing activities by closing public offering of
$1.5billioninnotes.
Avoninvestsonnewpackagingsystems.
In November 2012, Avon announces a decline in quarterly dividend from $0.23 per
shareto$0.06pershare,forthefourthquarterdividendpaidinDecember2012.
325
326
Companies
4A26
CONSUMERRESEARCH
Consumer research has been conducted via an online survey among 305 residents of the
UnitedStatesinMay2013.
Thepurposeoftheresearchistounderstandtheusagepatternsofcertaincosmetics
and toiletries categories, where these products are bought, and what attitudes the
respondentshaveaboutusingandbuyingcosmeticsandtoiletriesproducts.
ThesamplewasselectedtomatchthepopulationoftheUnitedStatesintermsofrace,
ethnicgroup,andagebreakdownoftheU.S.population.
Thesamplewasalmostexactlysplitevenlybymalesandfemales
PleasenotethatKlinepurposefullydidnotattempttosurveyanyoneunder15orover
69yearsofage,forvariousreasons.
HAIRCARE
Usage
Table316:UsageofHairCareProductsbyAge
Age,%
1519
2029
3039
4049
5059
6069
%Ofall
responses
2in1shampooandconditioner
21
18
21
15
16
37
Shampoo
20
19
20
19
13
88
Conditioner
10
22
21
19
17
11
69
Hairstylinggel
10
16
25
21
19
34
Hairstylingcream
22
28
24
10
16
Hairstylingpomadeorwax
24
37
18
11
12
Hairspray
19
25
21
17
13
36
Hairstylingmousse
21
33
17
14
20
Inhomehaircolor/dye/greycoverage
13
28
24
19
11
25
Thinninghairprep/hairregrowthproduct
14
43
29
10
Damagecontrolproducts
25
31
18
13
23
Scalp/dandruffcontrolproducts
21
24
21
16
10
29
Insalonhaircolor/dye/greycoverage
35
30
13
Otherhaircareproducts
10
28
16
24
12
10
16
Noneoftheabove
14
14
29
29
14
328
ConsumerResearch
Figure31:UsageofHairCareProductsbyGender
2in1shampooandconditioner
Conditioner
Damagecontrolproducts
Hairspray
Hairstylingcream
Hairstylinggel
Hairstylingmousse
Hairstylingpomadeorwax
Inhomehaircolor/dye/greycoverage
Insalonhaircolor/dye/greycoverage
Scalp/dandruffcontrolproducts
Shampoo
Thinninghairprep/hairregrowthproduct
Otherhaircareproducts
Noneoftheabove
0%
10%
20%
30%
40%
50%
Female
60%
70%
Male
80%
90% 100%
In the United States, hair care products such as hair regrowth products, 2in1 shampoos
and conditioners, dandruff control products, and hair styling gels are the most popular
amongmen.
Women use mostly hair care products like damage control products, hair gels, hair
sprays,haircoloringproducts,andhairstylingcreams.Eachoftheseproductsareused
byatleast30%ofwomen.
Shampoos, conditioners, hair styling gels, and hair sprays are the hair care products
thatareusedmostbyHispanics.
Accordingtothesurvey,12%ofwomengettheirhairdyedinsalons,while37%usein
homehaircolor.
4A28
ConsumerResearch
Retaildistribution
Table317:RetailDistributionofHairCareProductsintheUnitedStates
Male
Female
Idon'tshopfortheseproducts,someoneelsebuysthemforme
83
17
Massmerchandisers
41
59
Discountdepartmentstores
56
44
Upscaledepartmentstores
88
13
Traditionaldepartmentstores
71
29
Specialtybeauty/cosmeticstoreswhichcarryseveralbrands
27
73
Storeswhichonlycarryonebrand
33
67
Warehouseclub
54
46
Drugstores
47
51
Food/grocerystores
48
52
Dollarstore
43
57
HomeshoppingTVchannels
80
20
Internet/Online/mobilephone
29
71
Persontopersonsales
38
63
Catalog/mailorder
50
50
Spa/salon
36
64
Other/don'tknow
83
17
329
330
ConsumerResearch
Figure32:ChannelsShoppedforHairCareProducts
Catalog/mailorder
Dollarstore
Drugstores
Food/grocerystores
Internet/online/mobilephone
Merchandisers
Persontopersonsales
Spa/salon
Warehouseclub
Other/don'tknow
0%
1519
2029
10%
3039
20%
30%
4049
40%
5059
50%
6069
60%
70%
80%
Consumerswhousuallydonotshopforhaircareproductsaremalesagedbetween15and
19years.
Internet/mobile shopping is more popular among people whose age is in the range of 20
and29years,at41%,whilespecialtystoreschannelisfavoredbyconsumersagedbetween
40and49.
Discountdepartmentstores,upscaledepartmentstores,andtraditionaldepartmentstores
areusedthemostbyconsumersbetweentheagesof30and39.
4A30
ConsumerResearch
Figure33:ShiftsinChannelsShoppedforHairCareProducts
60%
50%
40%
30%
20%
10%
0%
Ipurchasehaircare
productsfomspecialty
stores
Ipurchasehaircare
Ipurchasehaircare
productsfromdirectsales productsfromdepartment
stores
Ipurchasehaircare
productsfromsalonsor
spas
Moreofteninthepast12months
Lessoftenthaninpreviousyears
Aboutthesameaspreviousyears
Notsure/don'tknow
Haircareconcerns
Table318:HairCareConcernsbyGender
%
Gender
Male
Female
%Oftotalresponses
Oilyhair
50
50
25
Thinninghairorhairloss
62
38
31
Dryhair
30
70
22
Frizzyhair
92
23
Dandruff
71
29
26
Itchyscalp
58
42
20
Greyhair
47
53
32
Fine,limphair
23
77
19
Howtostyleitwell
27
73
24
Hairtoothick
24
76
12
Hairtoocurly
36
64
Coarsehair
16
84
Noneoftheabove
67
33
Other
50
50
331
332
ConsumerResearch
Whilehaircareconcernsamongmenaredandruff,hairlossorthinningofhair,anditchy
scalp, women worry about frizzy hair, coarse hair, fine limp hair, dry hair, and on how to
styletheirhair.
Ofthetotalrespondentswhostatedstylingtheirhairwellasaconcern,31%ofthem
areagedbetween30and39,followedcloselybypeopleaged2029.
Grayhair,oilyhair,hairloss,anddandruffarethemajorhairconcernsamongHispanics
intheUnitedStates.
SKINCARE
Usage
Table319:UsageofSkinCareProductsbyAgeGroup
%
1519
3039
4049
6069
%Ofall
responses
27
23
19
15
52
Facialscruborexfoliator
20
29
23
14
39
Toner/astringent
19
31
21
21
16
Facialmoisturizer
23
25
19
15
13
45
BBcreamortintedmoisturizer
32
35
12
11
Eyetreatment
11
23
21
32
11
17
Acnetreatment
23
33
21
15
26
Oilcontrollingtreatment/antishineproduct
36
31
10
17
14
Facialsunscreen
18
27
26
14
10
34
Darkspotcorrector/skinbrightener(anti
discoloration,antidarkspot/markproduct)
17
20
34
17
13
Facialselftanningorsunlesstanningproducts
23
46
23
Bodycreams/lotions
20
24
19
19
10
59
Otherfacialskincareproducts
16
24
16
22
18
18
10
10
18
29
27
17
4A32
5059
Facialcleanserorwash
Noneoftheabove
2029
ConsumerResearch
Figure34:UsageofSkinCareProductsbyGender
Acnetreatment
BBcreamortintedmoisturizer
Bodycreams/lotions
Darkspotcorrector/skinbrightenera
Eyetreatment
Facialcleanserorwash
Facialmoisturizer
Facialscruborexfoliator
Facialselftanningorsunlesstanningproducts
Facialsunscreen
Oilcontrollingtreatment/antishineproduct
Toner/astringent
Otherfacialskincareproducts
Noneoftheabove
0%
10%
20%
30%
40%
Female
a Includesantidiscoloration,antidarkspot/markproduct.
50%
60%
70%
80%
Male
IntheUnitedStates,skincareproductsusedbymorethanhalfofthepopulationarefacial
cleansersandbodylotions.
Facialsunscreenandscrubareusedbyover30%ofthepeople,andacnetreatmentis
usedbyalmost26%.
Acnetreatmentproductsareusedalmostequallybybothmenandwomen.
Body creams and lotions, facial moisturizers, facial cleansers, facial scrubs, and facial
sunscreensareafewskincareproductsthataremostusedbyHispanics.
333
334
ConsumerResearch
Retaildistribution
Table320:RetaildistributionofskincareproductsintheUnitedStates
%
Male
Female
%Oftotal
responses
90
10
Massmerchandisers
36
64
61
67
33
44
56
38
62
25
75
Warehouseclub
43
57
Drugstores
43
57
40
Food/grocerystores
49
51
27
Dollarstore
41
59
14
40
60
24
76
10
Persontopersonsales
20
80
12
Catalog/mailorder
60
40
Doctorsoffice
33
67
Spaorsalon
50
50
Storesthatcarryonlyonebrand
31
69
11
Other/don'tknow
75
25
4A34
ConsumerResearch
Figure35:ChannelsShoppedforSkinCareProductsbyAge
Catalog/mailorder
Departmentstores
Dollarstore
Drugstores
Food/grocerystores
Massmerchandisers
Persontopersonsales,suchasAvonorArbonne
Spa/salon
Warehouseclub
Other/don'tknow
0%
1519
2029
10%
20%
3039
30%
4049
40%
5059
50%
60%
70%
80%
90%
6069
Mass merchandisers and drug stores are the most used channels to purchase skin care
productsbyconsumersagedbetween20and29years.
Internetoronlineshoppingforthecategoryisusedby11%ofconsumersaged20and29,
whichishigherthananyotheragegroup.
335
336
ConsumerResearch
Figure36:ShiftsinChannelsShoppedforSkinCareProducts
80%
70%
60%
50%
40%
30%
20%
10%
0%
Ipurchaseskincare
productsfomspecialty
stores
Ipurchaseskincare
Ipurchaseskincare
Ipurchaseskincare
productsfromdirectsales productsfromdepartment productsfromsalons,spas
stores
ordoctor'soffice
Moreofteninthepast12months
Notsure/don'tknow
Skincareconcerns
Table321:SkinCareConcernsbyGender
%
Linesorwrinkles
Unevenskintoneorhyperpigmentation
DarkSpots
Postacnemarksorscars
Acne/blemishes
Eyepuffinessorbagsundereyes
Largepores
Brokencapillaries/spiderveins
Drypatches
Scars
Saggingfacialskin
Rosacea
Darkcirclesundereyes
Oilyskin
Ingrownhairs
Irritation/redness
Sundamage
Noneofthese
Male
35
33
47
28
44
37
34
19
32
58
41
31
29
44
52
45
49
77
Female
65
67
53
72
56
64
66
81
68
43
59
69
71
56
48
55
51
23
4A36
%Ofallresponses
41
18
26
19
31
31
23
8
21
14
12
6
26
28
10
11
17
11
337
ConsumerResearch
Figure37:SkinCareConcernsbyAge
Acne/blemishes
Brokencapillaries/spiderveins
Darkcirclesundereyes
DarkSpots
Drypatches
Eyepuffinessorbagsundereyes
Ingrownhairs
Irritation/redness
Largepores
Linesorwrinkles
Oilyskin
Postacnemarksorscars
Rosacea
Saggingfacialskin
Scars
Sundamage
Unevenskintoneorhyperpigmentation
Noneofthese
0%
10%
20%
1519
30%
2029
40%
3039
50%
4049
60%
5059
70%
80%
90%
6069
Linesorwrinklesisbyfarthebiggestskincareconcernwomen,followedbypuffyeyes,dark
circles,andacnearethemajorskincareproblemsamongwomenintheUnitedStates.
Consumersbetweentheagesof20and29areconcernedmostaboutbyproblemslike
acneorblemishes,oilyskin,acnescars,andlargeporeswhilethoseagedbetween40
and49worryaboutwrinkles,puffyeyes,anddarkspots.
AccordingtotheHispanicrespondentsinthesurvey,majorskincareconcernsinclude
oily skin, dark spots, eye puffiness, and wrinkles. Nearly 7% of the Hispanics worry
aboutspiderveinsandsaggingfacialskinwhilealmost5%ofthemareconcernedwith
ingrownhairs.
338
ConsumerResearch
FRAGRANCES
Usage
Table322:UsageofFragranceProductsbyAge
Age
%
Perfumeorcologne
Aftershave
Otherfragrances
Noneoftheabove
1519
10
10
2029
23
15
19
16
3039
21
16
25
13
4049
18
23
18
24
5059
20
23
21
16
6069
10
20
21
Total
100
100
100
100
65
27
22
20
%Ofallresponses
In the United States, perfumes are more popular among people aged 20 and 29 years,
followedbyconsumersbetweentheagesof30and39.
Foraftershaveproducts,thehighestusageisatiebetweenmentheagesof40and49,
and 50 and 59, with each age group contributing to 23% of the total of aftershave
productsusage.
Compared to men, women in the United States utilize perfumes or colognes to a greater
extent.
Accordingtothesurvey,thehighestusageofperfumesisbywomen(71%)followedby
men(59%).
Theclaimtonotuseanyfragranceatallissplitequallybygender,atabout20%ofmen
and20%ofwomensayingtheyusenoneoftheabovefragrances.
Nearly 82% of the Hispanic respondents use perfumes or colognes while 41% of them
employaftershave.
Approximately8%oftheHispanicsdonotutilizeanykindoffragranceproducts.
4A38
ConsumerResearch
Retaildistribution
Table323:RetailDistributionofFragrancesintheUnitedStates
%
Male
Female
56
44
%Oftotalresponses
4
Massmerchandisers
54
46
40
53
47
14
72
28
53
47
25
23
77
11
15
85
11
Warehouseclub
73
27
Drugstores
68
32
18
Food/grocerystores
71
29
Dollarstore
65
35
33
67
50
50
11
Persontopersonsales
42
58
Dutyfree(airport,inflight,etc.)
67
33
Catalog/mailorder
29
71
Other/don'tknow
25
75
Figure38:ChannelsShoppedforFragrancesbyAge
Catalog/mailorder
Dollarstore
Drugstores
DutyFree(airport,inflight,etc.)
Food/grocerystores
Merchandisers
Persontopersonsales
Warehouseclub
Other/don'tknow
0%
1519
2029
5%
10% 15% 20% 25% 30% 35% 40% 45% 50%
3039
4049
5059
6069
339
340
ConsumerResearch
Approximately67%ofthepeoplewhoshopforfragrancesinhomeshoppingchannelsand
44%oftheminupscaledepartmentstoresareagedbetween50and59years.
Menshopatwarehouseclubsforfragrancesmuchmorethanwomendo.
Internetoronlineordersareemployedbypeopleintheagegroupsof40and49,followed
byconsumersaged20and29years.
ORALCAREPRODUCTS
Table324:UsageofOralCareProductsintheUnitedStates
%
Mouthwash
Whiteningproductsstrips,trays,etc.
(notincludingtoothpasteormouthwash
withwhiteningproperties)
Noneofthe
above
1519
17
2029
21
23
14
3039
19
22
14
4049
21
19
19
5059
19
23
13
6069
12
23
Total
100
100
100
79
34
16
Age
%Ofallresponses
IntheUnitedStates,oralcareproductssuchasmouthwashesandteethwhiteningproducts
areusemorebymenthanwomen.
Approximately55%ofthepeoplewhoemployteethwhiteningproductsaremenwhile45%
ofthemarewomen.
AmongtheHispanics,nearly86%ofthetotalrespondentsusemouthwasheswhilearound
2%ofthemdonotemploythementionedoralcareproducts.
4A40
341
ConsumerResearch
OTHERTOILETRIES
Usage
Table325:UsageofToiletriesProductsbyAge
%
Bar
soap
Bodywashor
showergel
Deodorant
antiperspirant
stick/rollon/
underarmspray
Deodorant
bodysprayor
fragrancespray
1519
16
2029
17
24
20
25
20
21
3039
18
20
17
22
20
23
4049
21
19
20
16
22
18
5059
19
18
20
16
20
16
6069
17
10
14
12
13
Total
100
100
100
100
100
100
67
75
92
31
62
64
Age
%Ofallresponses
Shaving
creamorgel
Other
toiletries
Figure39:UsageofToiletriesProductsbyGender
Barsoap
Bodywashorshowergel
Deodorantandantiperspirantstick/rollon/underarmspray
Deodorantandbodysprayorfragrancespray
Shavingcreamorgel
Othertoiletries
0%
10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Female
Male
342
ConsumerResearch
IntheUnitedStates,barsoapsareusedequallybymenandwomen,whilebodywashesare
usedmorebywomen.
Of the total population, 92% use the more traditional stick/rollon or underarm spray
deodorants,while31%usebodyspray.
Only47%ofwomensaytheyuseshavingcreamorgel.
AmongtheHispanics,nearly90%ofthemutilizeantiperspirantrollonorunderarmspray
whilearound33%employbodysprays.
Barsoapsarepreferredtobodywashesandalmost58%ofthemuseothertoiletries.
Retaildistribution
Table326:RetailDistributionofOtherToiletries
%
Gender
Male
Female
%Ofalltotals
86
14
Massmerchandisers
46
54
74
63
37
100
67
33
24
76
Warehouseclubs
52
48
20
Drugstores
50
50
48
Food/grocerystores
50
50
48
Dollarstore
51
49
21
60
40
30
70
Persontopersonsales
32
68
Catalog/mailorder
50
50
Other/dontknow
75
25
23
77
13
4A42
ConsumerResearch
Figure310:ChannelsShoppedforToiletriesbyAge
Catalog/mailorder
Dollarstore
Drugstores
Food/grocerystores
Merchandisers
Persontopersonsales
Warehouseclub
Other/don'tknow
0%
1519
2029
10%
3039
20%
30%
4049
40%
5059
50%
6069
60%
70%
80%
Nearly 71% of the consumers aged between 15 and 19 years do not shop for toiletries
products.
Consumers between the ages of 2029, 3039, and 4049, each account for 21% of total
purchasesmadeinmassmerchandiserstores.
343
344
ConsumerResearch
Figure311:ShiftsinChannelsShoppedforToiletries
70%
60%
50%
40%
30%
20%
10%
0%
Ipurchaseshowergelfomspecialty
stores
Ipurchaseshowergelfromdirect
sales
Ipurchaseshowergelfrom
departmentstores
Moreofteninthepast12monthsthanpreviously
Notsureordon'tknow
GroomingattitudesintheUnitedStates
Figure312:IdontreallycareaboutmyappearancebyAge
60%
50%
40%
30%
20%
10%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
Neitheragreenordisagree
4A44
6069
ConsumerResearch
IntheUnitedStates,only4%ofthemenstronglyagreethattheyarenotconcernedabout
their appearance, while no woman strongly agrees about not being concerned about her
looks.
Nearly 56% of the Caucasian people and almost 67% of African Americans strongly
disagreetheywouldconsiderhavingplasticsurgery.
Approximately 34% of the women and 23% of the men slightly agree that they are
apprehensiveabouttheirfacelookingolder.
AmongtheHispanicpopulationintheUnitedStates,almost23%ofthembelievethat
onlycleansingisnecessarytotakecareoftheirskin.
Closeto51%oftherespondentswhostrictlyconsidermoisturizingasanimportantskin
careregimeliebetweentheagesof30and39.
Only5%oftheconsumersagedbetween20and29areloyaltotheirbrandswhereas
almost 23% of people between the ages of 60 and 69 strongly refuse to experiment
withdifferentbrands.
About 50% of the African Americans, 36% of the Asians, and 23% of Caucasian
Americansstronglyagreetotakeprideintakingcareoftheirskin.
Almost 29% of men and 19% of women in the United States somewhat agree to be
unawareofthelatestskincareadvanceswhile30%ofthemenand36%ofthewomen
neitheragreenotdisagree.
Natural or organic products are increasingly being favored by people of different age
groups. Approximately 14% of consumers aged between 15 and 19, 23% of people
aged between 20 and 29, and 25% of consumers between the ages of 30 and 39
strongly agree to use natural products. Close to 17% of the Hispanics wish to utilize
productswithnaturalororganicingredients.
Approximately29%ofthoseconsumerswhoseincomeliesbetweentherangeof$125,000
to $149,999 and 27% of persons with an income range of $150,000 to $199,999 would
considerundergoingnoninvasiveproceduressuchasBotox.
345
346
ConsumerResearch
AttitudesinbuyinggroomingproductsintheUnitedStates
Figure313:IenjoytryingnewbeautyorgroomingproductsbyAge
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
Nearly36%ofCaucasianAmericans,35%ofAfricanAmericans,7%ofAsians,50%ofNative
Americans,and11%ofpeoplewithmixedracialbackgroundintheUnitedStatessomewhat
agreetoenjoytestingnewgroomingproducts.
About52%ofthewomensomewhatagreetooftenshopatnearbystoreswhileonly
3% of them strongly disagree. Among the men, 40% of them agree toshop at stores
nearbywhile7%ofthemstronglydisagree.
Consumersbetweentheagesof60and69(36%)and15and19(33%)donotspenda
lot of money on buying grooming products for personal use. Only 17% of consumers
with an income range between $100,000 and $124,999 agree to spend a lot on
groomingproductswhilenearly22%ofthemdisagree.
While59%ofthewomenintheUnitedStatesstronglydisagreethatafamilymember
purchasesgroomingproductsforthem,only30%ofthemenstronglydisagreeforthe
same.
Approximately 24% of the Hispanics strongly agree while another 40% of them
somewhatagreetoshopforbeautyproductswhileshoppingforotherproducts.
Closeto50%oftheNativeAmericansand21%oftheAsiansstronglyagreetolookout
forimprovedorlatestbeautyproductswhileonly11%oftheCaucasiansand6%ofthe
AfricanAmericansdothesame.
Only 5% of the men and 4% of women strongly agree to spending large amounts of
moneyongroomingproducts,while11%ofthemenand10%ofthewomensomewhat
agree.
4A46
ConsumerResearch
Nearly 43% of consumers between the ages of 40 and 49 believe that higher priced
groomingproductsareofahigherqualitythanlowerpricedproductswhileonly11%of
them strongly consider this to be false. Close to 71% of Asians in the United States
considerhigherpricedproductstobeofahigherquality.
Almost 44% of the women and 34% of the men somewhat agree that they purchase
mostoftheirgroomingproductswhentherearedealsorpromotionswhileonly2%of
themenand1%ofthewomenstronglydisagree.
Figure314:IwouldconsiderhavingplasticsurgerybyGender
60%
50%
40%
30%
20%
10%
0%
Male
Female
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
Figure315:IwouldconsiderhavingplasticsurgerybyAge
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
347
348
ConsumerResearch
Figure316:IamconcernedaboutmyfacelookingolderbyRace
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
White/Caucasian
Black/AfricanAmerican
Stronglyagree
AsianorPacificIslander
Somewhatagree
NativeAmericanor
AlaskanNative
Mixedracialbackground
Somewhatdisagree
Other
Stronglydisagree
Figure317:CleansingisreallyallyouneedtotakecareofyourskinbyGender
35%
30%
25%
20%
15%
10%
5%
0%
Male
Female
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
4A48
ConsumerResearch
Figure318:CleansingisreallyallyouneedtotakecareofyourskinbyAge
40%
35%
30%
25%
20%
15%
10%
5%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
Figure319:MoisturizingisanimportantaspectofskincarebyGender
60%
50%
40%
30%
20%
10%
0%
Male
Female
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
349
350
ConsumerResearch
Figure320:MoisturizingisanimportantaspectofskincarebyAge
60%
50%
40%
30%
20%
10%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
Figure321:IliketotrydifferentbrandsofbeautyorgroomingproductsImnotthatbrandloyalbyAge
40%
35%
30%
25%
20%
15%
10%
5%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
4A50
6069
351
ConsumerResearch
Figure322:IliketotrydifferentbrandsofbeautyorgroomingproductsImnotthatbrandloyalbyRace
70%
60%
50%
40%
30%
20%
10%
0%
White/Caucasian
Stronglyagree
Somewhatagree
NativeAmericanor
AlaskanNative
Somewhatdisagree
Other
Stronglydisagree
Figure323:ItakeprideincaringformyskinbyAge
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
352
ConsumerResearch
Figure324:ItakeprideincaringformyskinbyRace
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
White/Caucasian
Stronglyagree
Somewhatagree
NativeAmericanor
AlaskanNative
Somewhatdisagree
Other
Stronglydisagree
Figure325:ItrytokeepupwiththelatestskincareadvancesbyIncome
80%
70%
60%
50%
40%
30%
20%
10%
0%
$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to $125,000to $150,000to $200,000or Refuseto
$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
4A52
Stronglydisagree
ConsumerResearch
Figure326:IliketousenaturalororganicproductsbyAge
60%
50%
40%
30%
20%
10%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
Figure327:IliketousenaturalororganicproductsbyIncome
70%
60%
50%
40%
30%
20%
10%
0%
$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
353
354
ConsumerResearch
Figure328:IwouldconsiderhavingnoninvasiveprocedureslikeBotoxbyAge
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
Figure329:IwouldconsiderhavingnoninvasiveprocedureslikeBotoxbyIncome
80%
70%
60%
50%
40%
30%
20%
10%
0%
$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
4A54
Stronglydisagree
ConsumerResearch
Figure330:IenjoytryingnewbeautyorgroomingproductsbyGender
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Male
Female
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
Figure331:IrarelygoshoppingbyIncome
80%
70%
60%
50%
40%
30%
20%
10%
0%
Under
$15,000
$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to$125,000to$150,000to$200,000or Refuseto

$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
355
356
ConsumerResearch
Figure332:InormallyonlygoshoppingatstoresnearmebyAge
60%
50%
40%
30%
20%
10%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
Figure333:Ispendalotofmoneyonbeauty/grooming/toiletriesforpersonalusebyrace
60%
50%
40%
30%
20%
10%
0%
White/Caucasian
Stronglyagree
Somewhatagree
NativeAmericanor
AlaskanNative
Somewhatdisagree
4A56
Stronglydisagree
Other
357
ConsumerResearch
Figure334:Itendtohaveafamilymemberpurchasemybeauty/grooming/toiletriesproductsbyrace
60%
50%
40%
30%
20%
10%
0%
White/Caucasian
Stronglyagree
Somewhatagree
NativeAmericanor
AlaskanNative
Somewhatdisagree
Other
Stronglydisagree
Figure335:I'malwaysonthelookoutfornewandimprovedbeauty/grooming/toiletriesproductsbyAge
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
1519
2029
3039
4049
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
5059
6069
358
ConsumerResearch
Figure336:I'malwaysonthelookoutfornewandimprovedbeauty/grooming/toiletriesproductsbyIncome
80%
70%
60%
50%
40%
30%
20%
10%
0%
Under
$15,000

$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
Figure337:Idon'tlikespendingalotofmoneyonbeauty/grooming/toiletriesproductsbyIncome
80%
70%
60%
50%
40%
30%
20%
10%
0%
Under
$15,000

$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
4A58
Stronglydisagree
359
ConsumerResearch
Figure338:Higherpricedbeauty/grooming/toiletriesproductsaregenerallyofhigherqualitythanlower
pricedproductsbyIncome
60%
50%
40%
30%
20%
10%
0%
Under
$15,000

$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
Figure339:ItendtomakemostofmypurchaseswhentherearedealsorpromotionsbyGender
50%
45%
40%
35%
30%
25%
20%
15%
10%
5%
0%
Male
Female
Stronglyagree
Somewhatagree
Somewhatdisagree
Stronglydisagree
360
ConsumerResearch
Figure340:ItendtomakemostofmypurchaseswhentherearedealsorpromotionsbyIncome
80%
70%
60%
50%
40%
30%
20%
10%
0%
Under
$15,000

$34,999
$44,999
$54,999
$74,999
$99,999
$124,999 $149,999 $199,999
more
answeror
don'tknow
Stronglyagree
Somewhatagree
Somewhatdisagree
4A60
Stronglydisagree
RETAILDISTRIBUTION
OUTLETDEFINITIONS
Cosmetics and toiletries are sold through a wide variety of purchase channels, with the
primaryretailoutletsfortheindustryshownbelow:
Departmentstores
Directsales
Drugoutlets
Foodstores
Massmerchandisers
Professionaloutlets
Specialtystores
In terms of total sales volume, mass merchandiser outlets continue to be the most
importantpurchasechannelforcosmeticsandtoiletries.
Consumersshopatmassmerchandiseroutletsforvaluesavings,convenientlocations,
andawidevarietyofstockkeepingunits(SKUs)frommostoftheproductcategories.
Therearethreemaintypesofmassmerchandiseroutlets:bigboxretailers(Walmart,
Target, and Kmart), general merchandise stores (dollar stores, such as Dollar General
andFamilyDollarStores),andwarehouseclubs(SamsClubandCostco).
Drugstoreoutletsaccountforaconsiderableportionofsalesacrossallproductcategories.
Therearethreesubclassesofdrugstores,asfollows:
Chaindrugstores,includingretailerssuchasWalgreens,RiteAid,andCVS.
Independentsfocusmostlyonprescriptiondrugsandothermedicines.
Deepdiscountdrugstoresconsistofafewregionalretailers.
Foodstoresremainanimportantchannel,especiallyfortheallfamilyproductcategories.
Food outlets can be divided into traditional supermarkets, super stores, food/drug
combinationstores,supercenters/combostores,andconveniencestores.
Departmentstorescanbedividedintothreeclasses,asfollows:
Lowerenddepartmentstores,suchasKohls,J.C.Penney,andSears.
Traditionaldepartmentstores,includingMacysandDillards.
Specialtydepartmentstores,suchasNeimanMarcusandSaksFifthAvenue.
362
RetailDistribution
Direct selling also plays a significant role in the selling of cosmetics and toiletries. This
channelconsistsoffiveprimarysubclasses:
PersontopersonmarketerslikeAvonandMaryKay.
HomeshoppingchannelssuchastheHomeShoppingNetworkandQVC.
Infomercials,whichrepresentaneducational/entertainmentformatwhereconsumers
canorderproductsdirectlyfromthemanufacturerviaatollfreetelephonenumber.
Ecommerce,includingbrandwebsites,multibrandsitessuchasGloss.comandretailer
sites.
Nonelectronic vehicles, which consist of catalogs, direct mail order, and direct
responseprints.
Specialty stores have become a significant purchase channel for cosmetics and toiletries
lately.Thefourmainsubclassesareasfollows:
Verticallyintegratedstores,suchasBath&BodyWorks.
Cosmeticspecialtyshops,suchasSephora,Ulta,andPureBeauty.
Beautysupplystores,suchasSallyBeautyandmanysmallindependents.
Apparelspecialtystores,suchasGapandBananaRepublic.
Professionaloutletsincludesalons,spas,anddoctorsoffices.
Of these purchase channels, salons are the most important, with purchases coming
mainlyfromhaircaresalonsandfromskincaresalons.KlinesSalonHairCarereport
coversthehaircaresegmentmorethoroughly.
Spas and medical care provider offices are an important channel for the skin care
marketandareassessedinmoredetailinKlinesreportProfessionalSkinCare.
ThisCosmetics&ToiletriesUSAstudyreportsonlythesalesofproductspurchasedfor
takehomebyconsumers.Ourprofessionalstudiesreportsalesofthoseproductsused
bytheprofessionalsaswell,knownasbackbarsales.
Other purchase channels for cosmetics and toiletries include health clubs, kiosks, hotel
stores,andgiftshops.
Travelretailordutyfreeshopsaretheonlyconsumeroutletsnotcoveredinthisreport.
4A62
RetailDistribution
SALESBYRETAILOUTLET
Mass merchandisers continue to be the most preferred retail channel for cosmetics and
toiletries, with total sales advancing 3.5% to reach $12,404 million in 2012, from
Mass merchandisers represent 30.7% of total industry sales in 2012, constant from
2011levels.
Massmerchandiserscontinuetoexpandtheirrangeofproductsbymakingavailableto
consumers not just the necessities, but a range of premium products at high price
points.
Themassmerchandiserretailchannelbigboxretailers,warehouseclubs,anddollar
storesis increasingly viewed as a destination for stocking up on commoditytype
items,suchaspersonalcleansingproducts,shampoos,anddeodorants.
Salesfromwarehouseclubscontinuetogrowin2012.
Massmerchandisershavealsoincreasinglystartedtostockuponnaturalpersonalcare
productswhichareindemandbytheconsumers,therebydrivingthesalesupforthe
retailchannel.
Privatelabel products, a growing segment in the cosmetics and toiletries market, is
predominantlypresentinmassmerchandisers,andtheincreasingpopularityofthese
privatelabelproductsaidsinthegrowthofthechannel.
Additionally,thereisagrowingtrendofmassmerchandiserslaunchingtheirownline
of privatelabel products. In November 2012, Walgreens introduces the Ology line of
personalcareandhomeproductssupposedlyfreeofharmfulchemicals.
The promotional offers organized by mass merchandisers, such as discounts, are
instrumentalindrivingsales.
In2012,Targetdecidestogomoreupscaleinitsbeautydepartmentinordertoattract
more highend brands. As part of this effort, in July 2012, Target launches a "beauty
concierge" test program in 32 stores around the Chicago area. Concierges, available
approximately 40 hours per week, stroll the beauty department with iPads, mirrors,
and product samples to provide unbiased expertise and guidance to shoppers in the
retailer's beauty department. By the end of 2013, Target plans to have 190 stores
offeringthisservice.
363
364
RetailDistribution
Drug stores follow as the second leading retail channel for cosmetics and toiletries in the
UnitedStates,withsalesat$7,276millionin2012,up1.8%from$7,149millionin2011.
The share of distribution for drug stores decreases nominally from 18.3% in 2011 to
18.0%in2012.
Drugstoreretailerscontinuetodiversifytheirproductofferingswithaddedemphasis
onthefrontendtobettercompetewithotherretailchannelsthatareencroachingon
theirturfsuchasmassmerchandisersandwarehouseclubs.
Acquisitions are one of the ways for the major drug chains to grow and have been
responsible for the major door expansion of Walgreens since 2005. Small regional
chainsarebeingpickedupbybothWalgreensandCVStofillinholesintheirnational
coverage.
Privatelabelandexclusivecosmeticandtoiletryproductsarestronginthedrugstores
channel, with some retailers such as CVS having very established privatelabel
programsthatmimicthelargestsellingbrandstowhichtheyareverysimilarinactive
ingredients and packaging. In contrast, Walgreens offers many exclusive and hard to
findbrands.
Manyofthechainsdevotemorefloorspacetopersonalcareandexpandtheirproduct
andbrandassortment.
Weeklyflyersfromthethreemajorchainsallhighlightcosmeticandtoiletryitemson
promotion.
Loyaltyprogramsandinstoreeventshelpengagethebeautycustomer.
Department stores are the thirdleading retail channel for cosmetics and toiletries, with
salesat$5,417millionin2012,up5.0%from$5,157millionin2011.
The share of sales from department stores increases from 13.2% of sales in 2011 to
13.4%in2012.
Departmentstoresremainchallengedasadestinationforbeautyproductsintheface
of growing sales from specialty stores, direct merchants, and mass merchandisers
expandingtheirselection.
Department store sales are cannibalized as some shoppers purchase from the e
commercesitesofdepartmentstores,whicharecapturedintheInternetportionofthe
directchannel.
Departmentstoreretailersworktobetterengageandcommunicatewiththeirbeauty
consumersbymorefrequentcommunicationviaoptinemails,morebeautyspacein
thecatalogsandmoremailingsdevotedexclusivelytobeauty,andgreateruseofsocial
mediatoengageconsumers.
Departmentstoresmodifytheirbeautydepartmentstoofferamoremodernshopping
environmentandbecomemorepertinenttobeautyshoppers.
Afraid to be stuck with unsold merchandise as experienced during the recession in
2008and2009,departmentstoresasawholecutbackonproductinventory.
Furthersalesinthedepartmentstoresareoffsetbythegoodperformanceofthemass
andspecialtystoreretailers.
Massretailersenhancetheirproductassortmentwithawidervarietyofupscalelines,
andtheadditionofsalesassociatesinmanycases.
Beauty specialty store retailers, such as Sephora and Ulta, continue to chip away at
department store sales, with the ability to more easily shop across brands with
knowledgeablesalesassistanceandinafunenvironment.
4A64
RetailDistribution
FoodstoresarethefourthleadingretailchannelforcosmeticsandtoiletriesintheUnited
States,withsalesup1.3%toreachat$5,217millionin2012,upfrom$5,149millionin2011.
Thedistributionshareforfoodstoresslidesfrom13.2%in2011to12.9%in2012.
Food outlets face increased competition from other channels encroaching upon their
share,sofoodstoresfeellotsofpressureanddonotplaceapriorityoncosmeticsand
toiletries.
While some retailers keep all the mainstream and natural personal care products
together,anincreasingnumberofstoresplacetheirnaturalpersonalcareproductsina
dedicatedarea,alongwithnaturalandorganicpackagedfood.
As cosmetic and toiletry marketers offer an evergrowing number of line extensions,
foodoutletsoftenfindthemselvesshortofspacetoofferalltheavailableproducts.
Privatelabelcosmeticsandtoiletriesaretypicallyevidentincommoditytypesegments.
Shampoos,handandbodylotions,liquidsoaps,andsuncareproductsarethetypical
productlabelofferings.
The direct sales channel registers sales at $4,499 million in 2012, up 6.7% from
Thedirectsaleschannelaccountsfor11.1%oftheU.S.cosmeticsandtoiletriesmarket
in2012,upfrom10.8%in2011.
Highestgrowthfortheentirechannelemergesfromtheecommercesubchannel.The
elimination of shipping charges for most beauty purchases over a certain minimum,
coupled with shoppers feeling more comfortable making online beauty purchases,
contributestothefastgrowthofthissubchannel.
Additionally,theeaseofpurchasealongwiththelureoffreesamples,andtheabilityto
order24/7fromacomputer,smartphone,ortablet,alongwiththeeasyabilitytoprice
checkproducts,furtherhelpstogrowsalesintheecommercesubchannel.
Home shopping networks, such as QVC and HSN, which have now begun to
merchandise mainstream brands, help the retail channel experience robust sales in
2012.
Printedmaterialsthatincludedirectresponse,catalogs,consumermagazines,remits,
andbillinginsertsareusedascommunicationsvehiclesforinformationpurposesand
helpdrivepurchaseinothersubchannels,mostlyinecommerce.
Persontoperson sales continues to dominate as the largest subclass of the direct
channel,despiteadeclineinmarketshare.
Oneofthebiggestchallengesfacingcompaniesthatfollowthepersontopersonsales
modelisrecruitingandretainingsalesassociates.
365
366
RetailDistribution
Specialty stores register increasing sales of $4,228million in 2012, up 8.2%, from

Thespecialtystoresaccountfor10.5%oftheU.S.cosmeticsandtoiletriesmarket,up
from10.0%in2011.
Specialty stores continue to revolutionize the merchandising of cosmetic and toiletry
productsandarecarefullymonitoredand,manytimesmimicked,byotherchannels.
Growth in this channel is driven by a large number of new store openings, more
apparel chains with sizeable store counts, knowledgeable sales associates, good
customer service, an easy ability to shop across product lines, and a more fun
environmentthananyotherchannel.
Attractive price points offered by specialty retailers such as Bath & Body Works and
VictoriasSecretBeautyhelpgrowthischannel.
SpecialtystoressuchasSephoraandUltabenefitfromtheopensellenvironmentand
availabilityofnichebrandsalongsidemajoronesincosmeticspecialtystores.
In 2012, Sephora launches Fragrance Flight Bars at some of its locations. Fragrance
FlightBarsisestablishedsoshoppersarenotinfluencedbycelebrityendorsementsor
productpackaging.
Ultalaunchesanewloyaltyprogramin2012calledULTAmateRewardsprogram,which
willeventuallyreplaceTheClubatUlta.Thenewprogramrollsouttothecentralregion
oftheUnitedStates,withmoreareasaddedin2013.
Sales through professional outlets decrease 9.3% to $1,331million in 2012 from

$1,467millionduring2011.
Thesaleschannelaccountsfor3.3%oftheU.S.cosmeticsandtoiletriesmarketin2012,
downfrom3.8%in2011.
The increasing popularity of professional results at home products contribute to the
declineofthechannelsalesin2012.
Moreover, consumers continue to opt for doityourself (DIY) solutions across
categoriesincluding,haircoloringproducts,nailpolishes,anddepilatories,waxes,and
bleaches.
Althoughtheeconomyisgettingbetter,consumersfrequencyofvisitingprofessional
outlets remains low contributing to the decline of the share of the channel in 2012.
Salonvisitsaregraduallygettingmorefrequentbutarenotuptoprerecessionlevels.
As a result, some professional brand marketers are broadening their distribution to
includetheInternet,specialtystores,andotherchannelsinordertostaycompetitive.
4A66
RetailDistribution
Table327:ManufacturersSalesofCosmeticsandToiletriesbyRetailOutlet,2011and2012
$Million
Retailoutlet
%Oftotal
2011
2012
2011
2012
Change,%
11,981
12,404
30.7
30.7
3.5
Drugstores
7,149
7,276
18.3
18.0
1.8
Departmentstores
5,157
5,417
13.2
13.4
5.0
Foodstores
5,149
5,217
13.2
12.9
1.3
Directsales
4,217
4,499
10.8
11.1
6.7
Specialtystores
3,906
4,228
10.0
10.5
8.2
Professionaloutlets
1,467
1,331
3.8
3.3
(9.3)
39,026
40,372
100.0
100.0
3.4
Massmerchandisers
Total
Theaveragemarginacrossallretailoutletsforcosmeticsandtoiletriesis34.3%in2012.
Professional outlets displace department stores to represent the largest margin at 50.0%,
muchhigherthantheindustryaverage.
Thechannelsellsproductsatfullpriceascomparedtootherchannelsofdistribution
whichtendtohavesomekindofapromotionalofferonmostofthetime.
Lowmarketingactivityofsalonproductscontributetothehighretailmargin
Thedirectsalesanddepartmentstoreschannelsalsoposthighmarginsat43.9%and38.0%,
respectively.
The direct sales channel has limited administrative and operational expenditures in
comparisontootherchannelsandhencemaintainahighmargin.
Department stores high margin is as a result of the minimal discounts offered on its
products.
Margins for drug stores, food stores, and mass merchandisers fall below the industry
average.
The drug stores, food stores, and mass merchandisers offer a variety of have huge
promotionaloffersintheformofpurchasewithpurchaseoffers,anddiscountcoupons
overandabovethemanufacturerspromotionalschemes.
Massmerchandisers,apopularretailchannelwiththemassconsumers,hasthelowest
averagemarginduetoincreasingcompetitionandpricingpressuresexperiencedfrom
otherretailchannels.
367
368
RetailDistribution
Table328:AverageMarginforMajorRetailOutletsintheUnited
States,2012
Retailoutlet
Professionaloutlets
Directsales
Departmentstores
Specialtystores
INDUSTRYAVERAGE
Drugstores
Foodstores
Massmerchandisers
Averagemargin,%
50.0
43.9
38.0
37.0
34.3
30.0
30.0
28.8
Additional details about retail channels can be found in Klines Beauty Retailing report
series.
Table329:PercentageofSalesofCosmeticsandToiletriesbyTypeofRetailOutlet,2012
%Oftotalmanufacturersdollars
Mass
merchandisers
Drug
stores
Department
stores
Food
stores
Babycareproducts
48
27
21
100
Conditioners
39
18
20
16
100
Dentureproducts
39
29
32
100
47
20
24
100
42
46
10
100
27
20
45
100
Eyemakeup
29
19
26
14
100
Facemakeup
24
18
30
16
10
100
Facialtreatments
14
16
25
30
100
Fragrancesformen
19
11
37
16
16
100
Fragrancesforwomen
12
34
12
35
100
39
39
18
100
36
19
18
22
100
Handandbodylotions
28
18
11
33
100
33
27
20
11
100
19
25
24
18
11
100
Mouthwashes
46
25
29
100
Nailpolishes
37
39
100
43
10
27
12
100
Shampoos
41
13
23
11
100
Shavingproducts
41
25
26
100
18
15
49
12
100
Suncareproducts
42
30
12
100
49
28
19
100
Toothbrushes
46
22
31
100
Toothpastes
44
18
37
100
Weightedaverage
31
18
13
13
11
11
100
Productcategory
Direct
sales
4A68
Specialty
stores
Professional
outlets
Total
369
RetailDistribution
Table330:U.S.SalesofCosmeticsandToiletriesbyTypeofRetailOutlet,2012
$Million
Productcategory
Mass
merchandisers
Drug
stores
Department
stores
Food
stores
Direct
sales
Specialty
stores
Professional
outlets
Total
Babycareproducts
138
78
60
288
Conditioners
645
298
17
331
50
66
264
1,653
Dentureproducts
124
92
102
318
959
408
82
490
61
41
2,040
68
75
16
163
92
68
24
153
340
Eyemakeup
786
515
704
108
379
244
2,709
Facemakeup
698
524
873
58
465
291
29
2,909
Facialtreatments
930
1063
1661
133
1994
532
332
6,645
Fragrancesformen
209
121
407
11
176
176
1,101
Fragrancesforwomen
326
163
924
27
326
951
2717
514
514
237
53
1,317
605
319
17
302
34
34
370
1680
Handandbodylotions
639
411
114
114
251
753
23
2,283
123
101
75
26
41
374
262
344
330
41
248
151
1,377
Mouthwashes
368
200
232
799
Nailpolishes
245
258
26
20
53
53
662
1731
403
81
1087
282
483
4,026
Shampoos
1074
341
26
603
157
131
288
2,620
153
93
15
97
373
Shavingproducts
30
25
83
20
169
Suncareproducts
440
314
63
126
63
52
1,048
133
76
51
271
Toothbrushes
341
163
230
741
Toothpastes
770
315
647
17
1,749
12,403
7,281
5,433
5,227
4,583
4,268
1,331
40,372
Total
370
RetailDistribution
4A70
PRIVATELABELACTIVITY
Privatelabelproductsaredefinedinthisreportasproductsmarketedashousebrandsor
storebrands,aswellasgenericproducts.
Forthepurposeofthisstudy,productsfromretailerssuchasBath&BodyWorksand
TheGaparenotconsideredprivatelabelbrands,butspecialtybrands.
Although privatelabel product penetration in the cosmetics and toiletries industry is

marginal,theyslowlyandgraduallyimprovetheirmarketshare.
Theprivatelabelproductsrepresenta3.2%ofthetotalcosmeticsandtoiletriessalesin
2012, flat from 2011 percentage. Sales of private label grow 3.1% to reach
$1,300millionin2012,upfrom$1,261millionin2011.
Privatelabel products have a significant presence in the baby care products,
mouthwashes,toothbrushes,andsuncareproductscategoriesin2012.
The national, wellrecognized brands still dominate the various categories in the
cosmeticsandtoiletriesindustry.
Sales of privatelabel products in some product categories are too negligible to be
consideredforanalysisinthisstudy.
Thepersonalcleansingproductscategoryholdsthetoppositioninprivatelabelsales.
Privatelabel sales in the personal cleansing products category total $338million in
2012,accountingfor26.0%ofthetotalsegmentsales.
Mouthwashesrepresent10.4%oftotalprivatelabelsales,or$135millionin2012.
Facialtreatmentsaccountfor9.8%oftotalprivatelabelsales,or$127millionin2012.
In2012,privatelabelsuncareproductsregistersalesof$122million,or9.4%oftotal
personalcareprivatelabelsales.
Thesaleofprivatelabelproductsasapercentageofcategorysalesaveragestobe3.2%.
In nine product categories, sales of privatelabel products are above or equivalent to
theindustryaverage.
Baby care products continue to be the leading category in privatelabel sales as a
percentage of the entire category, accounting for 18.8% of category sales in the U.S.
marketin2012.
Salesofprivatelabelbrandsinthemouthwashescategoryaccountfor16.9%oftotal
mouthwashsalesin2012.
Privatelabelsalesin10categoriesrepresentlessthan1.0%ofthetotalcategorysales.
Four out of these 10 categories have virtually no privatelabel sales at all. These
categories include hair styling products and sprays, hair coloring products, skin care
productsformen,andethnichaircareproducts.
372
PrivatelabelActivity
Retailersutilizeprivatelabelproductsasoneofthemeanstodifferentiatethemselvesfrom
otherretailersinthemarket.
In addition to differentiating themselves from the others in the market, the retailers
countonprivatelabelproductstoboostprofitabilityandimproveconsumerloyalty.
Most of the retail stores offer private label programs in order to compete with the
nationalbrandsthatarebackedbyagoodadvertisingsupport.
Furthermore,retailersbenefitfromthesaleofprivatelabelproductsduetothehigh
profitmargin on these products in comparison to those on nationally advertised
brands.
Retailers are increasingly supporting the sales of privatelabel products by providing
them prime shelf space. Other promotional initiatives include instore campaigns,
rewardcards,andnewspaperpromotions.
To help better understand the consumers needs and choices, privatelabel
manufacturersworkcloselywithretailersinordertodevelopproductsthatappealto
themasses.
Privatelabel products are now achieving mainstream status as retailers narrow down the
price and quality gaps that once differentiated the privatelabel products from national
brands.
The initial wave of privatelabel products focused on copying the national branded
products and making them available at a low price points, especially during the
recession.However,thenotionhaschangednowwithretailersdevelopinginnovative
products and packaging that helps the retailers differentiate their products from the
othersavailableinthemarket.
Privatelabel products are more prominently present in the personal hygiene
categoriesthanthecosmeticcategories.
In 2012, personal cleansing products, mouthwashes, facial treatments, and sun care
productsrepresentthelargestsalesamongotherprivatelabelproductcategories.
In2012,thegrowthofprivatelabelproductsdipsbelowtheindustrygrowthrateof3.6%.
Thelipbalms,jellies,andtreatmentscategoryrecordsthehighestgrowthrateinthe
privatelabel segment in 2012, with sales up 22.2% from $9 million in 2011 to
$11millionin2012.
The eye makeup and nail polishes categories follow as the secondfastest growing
categoriesinthesegmentwith14.3%growthforeachofthem.However,theseareall
fromsmallbasesalesfigures.
In2012,privatelabelmakesitspresencefeltinthemakeupproducts.
Privatelabel products are now available in the eye makeup, lipsticks and lip glosses,
facemakeup,andnailpolishescategories.
4A72
Table331:U.S.SalesofPrivatelabelCosmeticsandToiletriesbyProductCategory,2012
Productcategory
$Million
338
26.0
Mouthwashes
135
10.4
Facialtreatments
127
9.8
Suncareproducts
122
9.4
Handandbodylotions
109
8.4
Toothbrushes
101
7.8
Shampoos
82
6.3
Babycareproducts
54
4.2
Conditioners
41
3.2
Fragrancesforwomen
37
2.8
Dentureproducts
26
2.0
Eyemakeup
24
1.8
Facemakeup
22
1.7
16
1.2
Toothpastes
15
1.2
Shavingproducts
14
1.1
11
0.8
10
0.8
Nailpolishes
0.6
0.2
Fragrancesformen
0.2
0.2
1,300
100.0
Total
%Oftotalprivatelabelsales
373
374
Table332:U.S.SalesofPrivatelabelCosmeticsandToiletriesbyProductCategoryasaPercentageof
CategorySales,2012
$Million
Products
Privatelabel
Babycareproducts
%Privatelabeltocategorytotal
54
288
18.8
Mouthwashes
135
799
16.9
Toothbrushes
101
741
13.6
Suncareproducts
122
1,048
11.6
338
4,026
8.4
Dentureproducts
26
318
8.2
16
271
5.9
109
2,283
4.8
Shavingproducts
14
373
3.8
Shampoos
82
2,620
3.1
11
374
2.9
Conditioners
41
1,653
2.5
127
6,645
1.9
163
1.8
37
2,717
1.4
Nailpolishes
662
1.2
Eyemakeup
24
2,709
0.9
Toothpastes
15
1,749
0.9
Facemakeup
22
2,909
0.8
10
1,377
0.7
Fragrancesformen
1,101
0.3
2,040
0.1
1,680
1,317
169
340
1,300
40,372
3.2
Handandbodylotions
Facialtreatments
Fragrancesforwomen
Total
Total
4A74
Table333:U.S.SalesofPrivatelabelCosmeticsandToiletriesbyProductCategory,Rankedby
$Million
Category
2011
2012
Change,%
11
22.2
Eyemakeup
21
24
14.3
Nailpolishes
14.3
10
11.1
Facemakeup
20
22
10.0
Shavingproducts
13
14
7.7
Toothbrushes
94
101
7.4
Toothpastes
14
15
7.1
15
16
6.7
120
127
5.8
35
37
5.7
Mouthwashes
129
135
4.7
Suncareproducts
117
122
4.3
Babycareproducts
52
54
3.8
330
338
2.4
Fragrancesformen
109
109
26
26
Conditioners
43
41
(4.7)
Shampoos
90
82
(8.9)
1,261
1,300
3.1
Facialtreatments
Fragrancesforwomen
Handandbodylotions
Dentureproducts
Total
375
376
Privatelabelproductswillcontinuetoperformwellthroughtheforecastperiodfrom2012
to2017.
Privatelabelisexpectedtoincreaseitsmarketshareduringtheforecastperiodending,
2017.
Private labels will continue to provide stiff competition to branded products by
launching products with improved quality and at competitive prices. However, mass
retailers will continue to offer privatelabel brands that mimic the bestselling
nationallyadvertisedonesduetotheattractivemargins.
Privatelabel products enriched with natural ingredients and a naturallypositioned
imagewillwitnessexpansioninthecomingfiveyears.
Pricing for privatelabelproducts will also grow during the next fiveyears, but would
stillbeacostsavingalternativecomparedwithnationalbrands.
Reinforcingtheperceptionofimprovedquality,retailersareexpectedtocreatemulti
tiered privatelabel products in the cosmetics and toiletries market. These multi
layeredprivatelabelproductsareexpectedtoattractdifferentconsumerssegments.
Retailers will look to expand the distribution network for their privatelabel products
beyondtheirownstorenetworksandarelikelytosupporttheirproductofferingswith
improvedpromotionalsupport.
4A76
MARKETINGACTIVITY
TRACEABLEMEDIAEXPENDITURES
Traceable media expenditures (TME) in the cosmetic and toiletry market are recorded at
TotalTMEspendingonthecosmeticsandtoiletriesmarketfor2012increases2.7%.
Televisionremainstobethemostpreferredmediumofadvertisingformostmarketers,
followedbymagazines.
Marketers spend approximately 50% of the entire TME on television advertisements
andapproximately45%onprintmediain2012.
TMEaresourcedfromKontarMedia.
Thefiveleadingproductcategoriesaccountfor48.3% oftotaladvertisingexpendituresin
2012.
Facial treatments, the leading category in dollar sales, continue to have the largest
advertising spending, with a TME of $1,334 million in 2012, up 9.3% from
Shampoos is the secondmost advertised category, representing 7.3% of the total
mediaspending,withaTMEof$446millionin2012
Face makeup continues to be the thirdlargest category with respect to advertising
expendituresin2012.TheTMEforthecategoryin2012is$438million,upmarginally
by1.6%from$431millionin2011.
Skin care products for men and ethnic hair care products are the smallest categories
with respect to promotional spending, with a TME of $19 million and $1 million,
respectively.
The 29 leading marketers profiled in this report represent $5,750 million in TME, or
approximately91.2%ofthetotalindustryTME,in2012.
Thetopfivemarketersaccountfor63.7%oftotalindustryTMEin2012.
LOralhasthelargestTME,withaspendingof$1,448millionin2012,up10.4%from
$1,312millionin2011.Thecompanyaccountsfor23.0%oftotalindustryTMEin2012.
Procter&GambleisthesecondlargestadvertiserwithaTMEof$1,217millionin2012,
down18.3%from$1,490millionin2011.
Unilever, the third largest advertiser, spends a TME of $522million, accounting for
8.3%ofthetotalindustryTMEin2012.
378
MarketingActivity
In 2012, 10 categoriesTME as a percentage of the category sales are above the industry
averageof15.6%.
NailpolishesaccountforthelargestTMEasaproportionofthecategorystotalsalesin
2012.
TheTMEinthenailpolishescategoryrepresents36.3%ofthetotalcategoryssalesin
2012.
In2012,theTMEfordepilatories,waxes,andbleachesare$57million,oraccountfor
35.0%ofthecategorystotalsales.
Sales of tooth whitening products total $271million, while the categorys TME is at
$79millionin2012. Therefore,thepercentageofTMEtothetotalcategoryssalesis
29.2%.
TheethnichaircareproductscategoryhastheleastpercentageofTMEasaproportion
tothecategoryssalesat0.3%.
In 2012, 15 of the leading 29 companies have a TME as a percentage of sales above the
industryaverageof15.6%.
GuthyRenker registers the highest percentage of spending to sales proportion, at
41.2%during2012.
GlaxoSmithKline is the secondleading marketer, which records a TME representing
31.9%ofthecompanyssalesinthecosmeticsandtoiletriesmarketin2012.
LOralisinaclosethirdposition,withtheTMEaccountingfor31.8%ofthecompanys
sales.
Mostofthemarketersincreasetheiradvertisingbudgetinordertosupportsalesgrowthfor
theirbrandsin2012.
Marketersutilizedifferentmarketingmediatopromotetheirproductsfortheirvarious
portfoliosofbrands.
There is an evolution of nontraditional media, such as social media, the Internet,
YouTube, and mobile marketing, but these are complementary to the traditional
advertisingmedia,whichcontinuestobeimportant.
Most companies have started to launch campaigns that encompass both traditional
andnewmediatogainaccesstoawiderrangeofconsumersandexposeproductsto
morepeople.
Companies are increasingly starting to advertise on the Internet because it is an
effective platform to share product information and create awareness among
consumers,duetoitswideoutreachandeasyaccessofinformation.
Mostofthemarketersgenerallysupporttheirnewproductintroductionswithaheavy
advertising expenditure. These promotions are in the form of print and television
advertisements,samples,socialmedia,sweepstakes,andinstoremarketing.
Other promotional tools adopted by marketers include the use of Internet, coupons,
mobilecommerce,andlaunchevents.
4A78
MarketingActivity
Table334:ProductCategoriesRankedbyTraceableMediaExpenditures,2012
Category
$Million
Facialtreatments
1,334
21.2
Shampoos
446
7.1
Facemakeup
438
6.9
Eyemakeup
379
6.0
Toothpastes
338
5.4
Fragrancesforwomen
325
5.2
Othercosmeticsandtoiletries
322
5.1
Handandbodylotions
297
4.7
297
4.7
277
4.4
Haircareproductsmultiproduct
255
4.0
Nailpolishes
240
3.8
224
3.6
165
2.6
154
2.4
Fragrancesformen
135
2.1
Conditioners
119
1.9
Mouthwashes
105
1.7
Suncareproducts
80
1.3
79
1.3
Dentureproducts
61
1.0
57
0.9
Babycareproducts
55
0.9
Toothbrushes
42
0.7
33
0.5
Shavingproducts
31
0.5
16
0.3
6,305
100.0
Total
%Oftotal
379
380
MarketingActivity
Table335:LeadingCosmeticandToiletryCompaniesRankedbyTraceableMedia
Expenditures,2012
Company
$Million
%Oftotal
L'Oral
1,448
23.0
Procter&Gamble
1,217
19.3
Unilever
522
8.3
Johnson&Johnson
440
7.0
EsteLauder
386
6.1
GuthyRenker
304
4.8
Coty
283
4.5
Revlon
161
2.6
Kao
131
2.1
GlaxoSmithKline
130
2.1
ColgatePalmolive
110
1.7
LVMH
90
1.4
Chanel
87
1.4
Church&Dwight
66
1.0
ElizabethArden
57
0.9
Shiseido
52
0.8
Sanofi
51
0.8
Combe
39
0.6
EnergizerHoldings
33
0.5
Clarins
27
0.4
Beiersdorf
26
0.4
MaryKay
18
0.3
Merck
18
0.3
Avon
13
0.2
Alticor
12
0.2
HelenofTroy
12
0.2
TheCloroxCompany
10
0.2
Henkel
0.1
LimitedBrandsa
555
8.8
6,305
100.0
Allother
Total
aTMEdatanegligible.
4A80
MarketingActivity
Table336:TraceableMediaExpendituresofCosmeticandToiletryProductCategoriesRankedby
PercentageofSales,2012
Traceablemediaexpenditures
U.S.salesofcosmetics
andtoiletries,$million
Category
$Million
%Ofsales
Nailpolishes
662
240
36.3
163
57
35.0
271
79
29.2
1,317
297
22.6
1,377
277
20.1
Facialtreatments
6,645
1,334
20.1
Toothpastes
1,749
338
19.3
Dentureproducts
318
61
19.2
Babycareproducts
288
55
19.1
Shampoos
2,620
446
17.0
Facemakeup
2,909
438
15.1
Eyemakeup
2,709
379
14.0
799
105
13.1
Handandbodylotions
2,283
297
13.0
Fragrancesformen
1,101
135
12.3
Fragrancesforwomen
2,717
325
12.0
2,040
224
11.0
1,680
165
9.8
169
16
9.5
374
33
8.8
Shavingproducts
373
31
8.3
Suncareproducts
1,048
80
7.6
Conditioners
1,653
119
7.2
741
42
5.7
4,026
154
3.8
340
0.3
322
255
6,305
15.6
Mouthwashes
Toothbrushes
Total
40,372
aSalesincludedinvariouscategories.
bAdjustedtoexcludehaircaremultiproducttoavoiddoublecounting.
381
382
MarketingActivity
Table337:TraceableMediaExpendituresofLeadingCosmeticandToiletryCompaniesRanked
byPercentageofIndustrySales,2012
U.S.salesofcosmeticsand
toiletries,$million
Company
$Million
%Ofsales
GuthyRenker
737
304
41.2
GlaxoSmithKline
407
130
31.9
4,551
1,448
31.8
337
90
26.7
1,086
283
26.1
Sanofi
197
51
25.9
Kao
525
131
25.0
Combe
157
39
24.8
2,020
440
21.8
313
66
21.1
5,824
1,217
20.9
Revlon
814
161
19.8
ElizabethArden
290
57
19.7
Chanel
461
87
18.9
Clarins
171
27
15.8
Unilever
3,546
522
14.7
EsteLauder
2,722
386
14.2
ColgatePalmolive
1,493
110
7.4
Shiseido
542
52
9.6
Merck
209
18
8.6
EnergizerHoldings
396
33
8.3
HelenofTroy
147
12
8.2
Beiersdorf
344
26
7.6
Alticor
176
12
6.8
TheCloroxCompany
172
10
5.8
1,063
18
1.7
Avon
948
13
1.4
Henkel
635
1.1
LimitedBrandsa
1,785
Allother
8,304
555
6.7
40,372
6,305
15.6
L'Oral
LVMH
Coty
Johnson&Johnson
Church&Dwight
Procter&Gamble
MaryKay
Total
aTMEdatanegligible.
4A82
MarketingActivity
Television advertising is the most commonly used form of advertising for cosmetic and
toiletryproductsduetoitsabilitytocoverawideaudience,oramorespecifictargetgroup,
asrequired.
Differentkindsoftelevisionchannelsincludenetworktelevision,cabletelevision,and
syndicatedtelevision.
Companiesalsousedifferentprintmediasuchasmagazines,newspapers,andjournals
toreachouttoconsumerswiththeiradvertisements.
Advertisingintheprintmediaiscomparativelycheaperthanadvertisingontelevision.
Different types of magazines include Sunday magazines, local magazines, womens
service magazines, fashion magazines, and magazines for specific groups, such as
Hispanicmagazines.
Increasingly, companies are also using nontraditional media, such as the Internet,
social media sites, and mobile phones to advertise their product lines. Such media is
used in addition to the traditional advertising and to reach out to a wider set of
consumers.
In2012,marketerscontinuetoengagecelebritiestoendorsetheirbrandsforprintand
televisionadvertisements.
Largeproductclassessuchasskincare,makeup,andhaircarewidelypromotetheuse
ofcelebritiestoendorsetheirnewproductlinesortheirbestsellingproductsbythis
mean.
ThecelebritiesengagedbymarketerincludepopularfilmandTVpersonalities,models,
andsportspersonsandathletes.
Therearefewmarketerswhousereallifepeopletopromotetheirproductsinorderto
giveconsumersamorerealfeelandjustifythebenefitsoftheirproducts.
The Internet has emerged as an extremely important medium to promote cosmetic and
toiletryproducts.
The medium is convenient, cost effective, accurate, and allows marketers to inform
peopleabouttheirbrands,productbenefits,andinnovationsonaregularbasis.
The medium of the Internet allows cosmetic and toiletry marketers to expand their
reachbeyondgeographicbarriersandcanbeaccessedvirtuallyfromanycornerofthe
worldthatoffersInternetaccess.
Manyretailersandmarketersofferspecialwebonlypromotionstohelpdrivesales.In
addition,samplesandgiftwithpurchase(GWP)aremoreoftenofferedonlinethanin
theactualretaillocation.
The Internet is increasingly used as a medium of crossmarketing a brand across
different media. Increasingly, most brands websites have links to their presence on
socialmediasitessuchasFacebook,Twitter,YouTube,Pinterest,andblogs.
TheInternetmediumofferstheconvenienceofathomeshopping,enablingconsumers
toshopfortheirbeautyneedsattheirowntimeandconvenience.
A brands website acts as a medium to convey the message to its consumers about
what the brand is all about and why consumers should be reposing their trust in the
brand.
383
384
MarketingActivity
Mostbrandwebsitesrequestconsumerstosignupwiththem,andonceregistered;the
member is entitled to receive a newsletter and access to special offers, samples,
coupons, various events, sweepstakes, giveaways, and insider information on a
monthlybasis.
Besides convenience, most brand websites also have customer service links or the
optionofspeakingtocustomerserviceexecutivestoanswertheconsumersproduct
relatedqueries.
Increasingly,websitesaddvaluebyfeaturingtips,funapplications,games,andquizzes
toentertaincustomers,therebystrengtheninginterestandloyaltyforthebrand.
Social media is emerging as an effective means to reach the end customer, both
independentlyandasacomplementtotraditionalcommunicationchannels.
It enables companies to reach out to their consumers and learn about their brand
experience,aswellasgetinsightsabouttheirbrandsfromthesecustomers.
TwoofthemostprominentplatformsinsocialmediaareFacebookandTwitter,both
ofwhichhaveseenexponentialgrowthintheirimportanceastoolsofcommunication.
Othersocialmediaplatformsincludepicturesharingsites,suchasFlickrandPinterest,
other microblog platforms, such as Tumblr, and a host of similar forums, such as
LinkedIn.
Agrowingnumberofcompaniesusesocialmediatosharedetailsaboutnewproduct
introductions, coupons, sweepstakes, special offers, events, details about social
initiatives, as well as to use it as an open platform to communicate with their
consumers through live chats, and share valuable consumer insights, opinions, and
experiences.
Facebook is being used by companies and brands to update information on brands,
announce new campaigns, new product launches, and details about coming events.
Facebookprovidesthemechanismforacompanyorbrandtoforwardblogpostsand
reviewstoitsconsumers.
Twitter is considered to be a direct forum for discussions, with more immediate
responsestocustomerenquiries.
Social media is increasingly being used to produce viral content in order to gain
attentionandattractnaturallinks,whichhelpstoreceivespontaneousresults.
4A84
MarketingActivity
Directmarketingisatraditionalmarketingmethoddirectedatconsumers,previouslyusing
the postal service, but now also utilize email, advertising circulars, brochures/catalogs,
postcards,andnewsletters.
Italsoincludesanyproductsthataresolddirectlytoconsumers,whichinthepersonal
care industry would include persontoperson brands such as Mary Kay and Avon;
infomercial brands, such as Proactiv and Sheer Cover; and brands that are sold on
homeshoppingchannels,suchasQVCandHSN.
Themainadvantageofdirectmarketingisthatbrandsusethismarketingtechniqueto
offer a personalized approach to their customers, thereby making the consumer feel
importantanduniquefromthemasses.
Brochures/catalogs are the ideal way to introduce a company and its collection of
products and services to potential customers. Marketers often make the cover of a
brochure/catalogattractive,withacatchycoverline,inordertoattractthecustomer
toreadthroughitratherthanjustignoreit.Theinsideofthefrontandthebackcover
generallyconsistsofthecompanysprofileandcontactinformation.Thebackpageof
thebrochureandcataloggenerallyfeaturesthebrandsbestsellers,thelatestlaunch,
oravaluedealinthecaseofcosmeticcompanies.Theinsidepagesofabrochureand
catalog typically features the complete collection of products and services offered by
the company. This specific channel of direct marketing is most popular with direct
marketerssuchasMaryKay,Alticor,andAvon.
Direct Response television (DRTV) is a popular direct marketing medium adopted by
cosmeticandtoiletrybrandsthatdoesnotfocusonthetraditionaladvertisingmedia.
DRTVhasbecomeaglobalphenomenon,withQVCandHSNbeingtheoutrightleaders.
For example, GuthyRenkers principal marketing activities involve the production of
infomercialsandhalfhourtelevisionprogramsthatmarketvariousbrands.
Insert media is another direct marketing medium adopted by beauty brands that
involvesinsertingmarketingmessagesaboutnewproductlaunches,events,coupons,
and samples in newspapers, magazines, and catalogs. As an example, the Mary Kay
LookBookcatalogcontainstwofoilwrappedsamplesofnewproducts.
Beautyretailersstillusecatalogsthatgomostlytoeitherchargeaccountcustomers,or
membersoftheirloyaltyprograms.Departmentstores,suchasLord&Taylor,Macys,
and Nordstrom, include cosmetic and beauty items as part of their regular catalog
mailings.SephoraregularlymailscatalogstomembersofitsBeautyInsiderprogram.
385
386
MarketingActivity
Samplesarealsousedbybrandsas amediumtoattractconsumersto trytheirproducts,

generate curiosity about a product, and gauge the consumers reaction to a new product
launch.
Samplesaregivenoutbybeautybrandssothatcustomerscantrytheproductbefore
makingapurchase.
Samplinginformationisalsodistributedintheformofnewspaperandmagazineinserts.
Another method of distribution is by including samples with any other cosmetic or
toiletry products purchased. This is often applicable for both instore and online
purchases.
The use of social media, such as Facebook and Twitter, is gaining prominence as
channelstodisseminateinformationaboutproductsamplestoconsumers.
Samplingisoftenakeymarketingstrategyforpromotingbrandsinretailstores.Luxury
brandsespeciallyutilizesampling.
Blogsarealsobeingusedasachanneltoshareinformationaboutproductsamples.
Coupons are one of the most popular and common means of product promotions in the
cosmeticandtoiletryindustry,formassmarketproducts.
Couponsarenotonlyusedtoattractconsumersbuttostrengthenbrandloyalty,which
isrequiredtosustainsalesinthefaceoffiercecompetition.
Consumersusediscountcouponstotestnewproductsandforbrandcomparison.
Coupons were initially offered mainly through the mail and as inserts in weekend
newspaperscommonlyknownasfreestandinginserts(FSI).
However, with the constant evolution in the cosmetic and toiletry industry, coupons
are now available through various avenues, such as the brands website, a retailers
website,socialmediasites,andevenonmobilephones.
Luxurybrandsoftenrelyonpricepromotionaloffersinsteadofcoupons.Intheprestige
arena, giftwithpurchase (GWP) or purchase with purchase (PWP), along with
promotional offers of a free product with a purchase becomes the main price
promotional tool, and is an extremely important marketing method for promoting
luxuryproducts.
Afewmarketers,suchasProcter&Gamble,hostaweekendnewspapercouponinsert
several times a year, which includes coupons for several of its brands including Olay,
Pantene,andCrest.ThisweekendnewspaperinsertallowsProcter&Gambletooffer
extravaluetoitsconsumersandhelpgainadditionalexposureforitsbrands.
Coupons are increasingly offered through mobile phones to attract consumers,
especiallyyoungadults.
With the rapid advent of online purchasing, coupon codes are also published online,
whichthebuyerneedstoenterwhilemakingthepurchaseandconsumersareallowed
toenjoytherelatedbenefitfromthecouponcode.
In order to make the offer more attractive, buyers of beauty brands online are also
offeredfreeshippingoftheirproducts,especiallywhenacertainminimumamountis
met. For example, Este Lauder offers free shipping with beauty purchases over a
certain amount as an incentive to encourage purchase. However, at times, Este
Lauderoffersfreeshippingforallonlineorders,withnominimumamountrequired.
4A86
MarketingActivity
TMEisonlyanapproximatemeasureofconsumeradvertisingcosts.
Itdoesnotincludecostsofinternaladvertisingdepartmentsoradagenciesfees,which
are often large, and charges for creative and production costs, which can also be
substantial.
As a partial offset to these costs, however, large advertisers can get substantial
quantity discounts that are not included in tabulations of media expenditures,
particularlyfortelevision.
Such discounts give large manufacturers a considerable advantage over smaller
competitors.
Discounts usually apply to yearly contracts for substantial purchases; for instance, a
standard 25% discount for television at nonprime time and a 12% discount for
magazines.
Smallerdiscountsaregivenforcontractsofshorterlengthorforlesserpurchases.
PROMOTIONS
Cosmeticandtoiletrycompaniesalsorelyonconsumerpromotionto:
Educatecustomersaboutnewproductlaunches
Encouragetrialsbyconsumers
Boostsalesforatemporaryperiod
Encourageupsellingorcrosssellingofproducts
Enhancecompetitivepositionduringpricewarperiods
Offerconsumersthevaluetheyareexpecting
Traditionalpromotionsinclude:
Coupons
Bandpackingoftwoproducts
Specialbonussizedpackages
Sampling
Trial/travelsizes
GWPorPWPpromotions
Other promotional vehicles include rebates and sweepstakes, especially for highvolume
commodity items like shampoos, deodorants and antiperspirants, personal cleansing
products,andtoothpastes.
387
388
MarketingActivity
Otherpromotionaleffortsattempttoboostconsumerawarenessandbrandimage.
Offering indirect discounts through free packs is a popular means of marketers to
promotesalesofbrandsthataredeclining.
Companiesemployinstorevisualaids,aimedatpromotingnewproductlaunchesand
toattractcustomersnearthepointofsale.
Specialeventsponsorshipsaredesignedtoboostbrandawarenessandarefrequently
supportedwithfreeproductsampledistributions.
Pointofpurchase displays and various other merchandising materials are also used
extensivelytoencourageimpulsivepurchasing.
Manymanufacturersofferatollfreetelephonenumberthatcanbeusedbyconsumers
tocallforinformation,productliterature,andsamples,ortoorderproducts.
Trade promotion support for cosmetics and toiletries is still driven by deal funding,
includingtypicaloffinvoicedealsandotherdiscountsandfinancialincentives.
Performancesupportforadvertisinganddisplayallowancesalsoremainssubstantial.
Further details on promotional efforts are provided in section four: The Products, and
sectionfive:MajorCompaniesofthisreport.
DetailsonTMEareprovidedinsectionseven:Advertising.
4A88
OUTLOOK
GROWTHTRENDS
Thecosmeticsandtoiletriesmarketprospersin2012duetoimprovingeconomicconditions,
technologicallyinnovativeproductintroductions,anincreaseinmediaexpenditure,aheavy
acquisitionactivity,andarisingdisposableincomeinthehandsofconsumers.
The improving economy has a desirable effect on the sales of the cosmetic and
toiletries industry. There is an increase in the disposable income available to
consumers; however, they are still mindful of their spending patterns due in part to
lingering unemployment. Highend consumers are less affected and continue to
purchase premium beauty products. This helps trade channels such as department
storesandspecialtystoresregistersalesgains.
Segments such as antiaging facial treatments continue to gain popularity among
consumers seeking to postpone or eliminate professional procedures like injected
fillersandcosmeticsurgery.
Technologicaladvancementisofimportanceinthecosmeticsandtoiletriesindustryin
ordertoattracttheattentionoftheconsumersbyofferingthemnewandmoreresults
orientedproducts.
Mass marketers will continue to retain their leading position in the market with the
introduction of products that offer results similar to luxury products while being
availableatalowerpricepoint,asthemajorityofthepopulationshopsinmassoutlets.
Sales of natural products will continue to pick up as consumers increasingly opt for
naturalandorganicproducts.
Table338:CompoundAverageGrowthRateoftheCosmeticsandToiletriesMarket,
2007to2017
Million
CAGR,%
Year
Dollars
Packages
Dollars
2007
36,263
9,578.9
2012
40,372
9,887.5
2.1
0.6
2017
46,829
10,924.7
3.0
2.0
Packages
390
Outlook
During the forecast period ending 2017, growth in the unit volume will grow slower than
dollarsalesgrowthwhichisgoingtobelargelybackedbythegrowthofproductsoffering
multiplebenefitsandavailableatpremiumprices.
Theluxury,specialty,andprofessionalchannelsareexpectedtohaveagrowthhigher
thanthemasschannelduringtheforecastperiod,resultinginhighervaluegrowthand
relativelylowervolumegrowth.
BASECASE(MOSTLIKELY)UNITANDDOLLARFORECASTSTO2017
Overallgrowth
Manufacturers sales in the cosmetics and toiletries market are forecast to advance to
$46.8billionby2017,increasingatacompoundannualgrowthrate(CAGR)of3.0%.
Unitgrowth
Total unit volume in the cosmetics and toiletries market is projected to reach
10,924.7million packages by 2017, growing at a CAGR of 2.0% from 9,887.5million
packagesin2012.
Nineofthe26categoriesareexpectedtohaveunitgrowthhigherthantheaverage.
Table339:UnitGrowthForecastfortheNineFastestGrowing
Categories,2012to2017
Productcategory
CAGR,%
Nailpolishes
8.0
Suncareproducts
6.4
5.3
Eyemakeup
4.4
Facialtreatments
4.2
3.5
Shampoos
2.2
Facemakeup
2.0
Fragrancesforwomen
2.0
4A90
Outlook
Table340:UnitSalesofCosmeticsandToiletriesintheUnitedStatesbyProductCategory,in
OrderofSize,2012and2017
Millionpackages
Productcategory
2012
CAGR,%
1,663.0
1,797.0
1.6
Toothpastes
1,005.0
1,046.0
0.8
891.2
925.9
0.8
Shampoos
741.0
826.0
2.2
Facialtreatments
670.0
823.0
4.2
Eyemakeup
524.9
650.8
4.4
528.7
555.2
1.0
Handandbodylotions
514.2
552.0
1.4
Conditioners
443.0
480.0
1.6
Facemakeup
421.4
465.3
2.0
Toothbrushes
349.0
366.0
1.0
Nailpolishes
234.6
344.7
8.0
Suncareproducts
244.8
334.0
6.4
237.5
256.0
1.5
Shavingproducts
238.3
253.0
1.2
225.0
230.0
0.4
Mouthwashes
192.0
203.0
1.1
Fragrancesforwomen
160.0
177.0
2.0
165.0
175.0
1.2
99.3
105.8
1.3
Fragrancesformen
99.9
104.0
0.8
Dentureproducts
88.0
89.0
0.2
Babycareproducts
82.6
86.0
0.8
33.2
39.5
3.5
18.9
24.5
5.3
17.0
16.0
(1.2)
9,887.5
10,924.7
2.0
Total
2017
391
392
Outlook
Table341:UnitSalesofCosmeticsandToiletriesintheUnitedStatesRankedby
ForecastRateofGrowth,2012to2017
Productcategory
CAGR,%
Nailpolishes
8.0
Suncareproducts
6.4
5.3
Eyemakeup
4.4
Facialtreatments
4.2
3.5
Shampoos
2.2
Facemakeup
2.0
Fragrancesforwomen
2.0
1.6
Conditioners
1.6
1.5
Handandbodylotions
1.4
1.3
Shavingproducts
1.2
1.2
Mouthwashes
1.1
1.0
Toothbrushes
1.0
Toothpastes
0.8
0.8
Fragrancesformen
0.8
Babycareproducts
0.8
0.4
Dentureproducts
0.2
(1.2)
Total
2.0
The tooth whitening products category is the only category to witness a decline in unit
volumeduringtheforecastperiodwithanannualratedeclineof1.2%through2017.
4A92
Outlook
Dollargrowth
Manufacturerssalesofcosmeticsandtoiletriesareprojectedtoreach$46,829millionby
2017,upataCAGRof3.0%from$40,372millionin2012.
Intotal,25ofthe26categoriesareexpectedtoincreaseindollarsalesthrough2017.
Nailpolishesandsuncareproductsareexpectedtoachievethehighestgrowthamong
allthecategoriesataCAGRof9.0%and7.1%,respectively,through2017.
TheU.S.economyisexpectedtoimproveoverthenextfiveyearstoexperiencemoderate
growth.Thiswillresultinthefollowing:
Consumersarelikelytoincreasetheirspendingonnewandinnovativeproductsthat
offermultifunctionalbenefitssuchassunprotection,antiaging,makeupeffects,and
acne reduction benefits. Consequently, the industry is also expected to have many
multicategoricalproducts.
Productsofferingprofessionalresultsathomewillcontinuetobeamainstayandare
expectedtogainattentionduringtheforecastperiod.Antiagingproductsarelikelyto
add in extra benefits including skin lightening, brightening complexions, evening out
skintones,andlighteningdarkspots.
Marketersareexpectedtointroducesimilarmultibeneficialproductsacrossalltrade
classestowidentheirportfolio.
Nailpolishisthefastestgrowingcategoryinthecosmeticsandtoiletriesindustryin2012
andisexpectedtomaintainitsrhythmofstrongperformancethroughtheforecastperiod.
Thebroadselectionofnailshadesandtexturesisexpectedtoinciteconsumerstowear
andrepurchaseoftenasawayofselfexpression.
Other innovations that are likely to drive growth include newer versions of current
trendsthatincludetexturednails,magneticnailpolish,andglitternailpolish.
Innovations in formulas especially in the gel nail segment are also expected to drive
salesinthefuture.
Someconsumerswillcontinuetoremainsensibleabouttheamountofmoneyspenton
salonvisitsandwillcontinuetoseekoutwaystoobtainthesalonlookwhiledoingtheir
ownnails.
Hence,consumersarelikelytoincreasetheirspendingonretailproductstoattainthe
professionalresultsonceobtainedonlythroughsalons.
Gelbasednailpolishesandkitsareanticipatedtogrowasmoremarketerslaunchsuch
products.Thesepolishesandsystemscarryahigherpricepointandwillcontributeto
theoveralldollargrowthforthecategory.
393
394
Outlook
Suncareproductsisforecasttobethesecondfastestgrowingcategoryduringthenextfive
years,growingataCAGRof7.1%.
Consumersapprehensionsofdevelopingskincancerasaresultoftoomuchexposure
tothesunwillensureincreasingdemandforsuncareproducts.
TheintroductionoftheFDAslongawaitedsunscreenmonographwillinducenewness
inthecategory.
Naturalandorganicformulationswillcontinuetogainattentioninthecategory,while
itwillremaindifficulttocreatetrulynaturalsunscreenproducts.
Thesuntanningsegmentisexpectedtocontinueitsdeclineduringtheforecastperiod.
The category is expected to witness an increase in the prices of the products due to
newandimprovedproductformulationsinaccordancewiththenewFDAregulations.
Theblurbetweentheskincareandsuncareproductsisexpectedtohaveadetrimental
effectonthesuncarecategorysgrowthduringtheforecastperiod.
Privatelabelproductswillcontinuetogrowthrough2017,butnotatthefastrateof
recentyears.
Skincareproductsformenwillprosperthrough2017.
Thecategoryhasstrongpotentialforbothvalueandvolumegrowthinthefuture.
As marketers continue to innovate and spread awareness about mens skin care
products,theproportionofmenbuyingtheseproductsislikelytoincreasegradually,
with male consumers feeling less awkward buying skin care products, as opposed to
theearlierpracticeofusingproductsoftheirfemalefamilymembers.
Thereisopportunityintheantiagingsegmentwithagrowingdemandfrommenaged
30yearsandolderforproductsofferingantiagingbenefits.
already available in the market, will be another area for marketers to attract the
attentionofthemaleconsumers.
Although prestige marketers shall continue to hold most of the market share in the
category,marketshareformassbrandsareexpectedtogrowfasterthantheprestige
brandsduringtheforecastperiod.
FacialtreatmentsareforecasttogrowatahealthyCAGRof5.0%inthecomingfiveyears.
The emphasis on looking good and keeping aging at bay will continue during the
forecastperiod,eveniftheUnitedStatesentersperiodsofeconomicuncertainty.
The definition of antiaging will continue to evolve and will include a myriad of
attributesinadditiontowrinklereductionandfirming,suchasbrightening,luminosity,
andradiance.
Facialtreatmentproductswillbeusedbothasasubstitutetocosmeticproceduresand
asanadjuncttothem,withthecommongoaloflookingasyoungaspossible.
Innovation backed by science will continue to be the main impetus to growing this
productcategory.
The FDA is expected to be more involved in examining the claims of facial treatment
brands.
Morenaturalingredientsarelikelytobeusedinfacialtreatmentproductsduringthe
forecastperiod.
Luxuryfacialtreatmentproductsareexpectedtoexhibitthemostgrowthoverthenext
fiveyearsandareexpectedtobecomethelargesttradeclass.Moreconsumerswillbe
willingtotradeuptowhattheyperceiveasbetterproducts.
4A94
Outlook
Duringtheforecastperiod,salesofthetoothwhiteningproductscategoryareexpectedto
decline.
Thesalesforthecategoryareprojectedtodeclineatacompoundannualrateof0.5%.
The tooth whitening category growth will be limited by stiff competition from
whiteningtoothpastesandmouthwashes.Usageoftheseproducts,increasinglymulti
benefit, is more affordable and convenient than the purchase of a separate tooth
whiteningproduct.
Twoothercategoriesareexpectedtounderperformduringtheforecastperiodwitha
CAGR of less that 1.0%. These categories include hair coloring products and denture
products.
Table342:DollarSalesofCosmeticsandToiletriesintheUnitedStatesbyProductCategory,in
theOrderofSize,2012and2017
Dollarsales
Productcategory
2012
2017
Facialtreatments
6,645
8,482
5.0
4,026
4,424
1.9
Facemakeup
2,909
3,372
3.0
Eyemakeup
2,709
3,296
4.0
Fragrancesforwomen
2,717
3,231
3.5
Shampoos
2,620
3,050
3.1
Handandbodylotions
2,283
2,500
1.8
2,040
2,160
1.1
Conditioners
1,653
1,870
2.5
Toothpastes
1,749
1,856
1.2
1,680
1,802
1.4
1,377
1,553
2.4
Suncareproducts
1,048
1,480
7.1
1,317
1,345
0.4
Fragrancesformen
1,101
1,244
2.5
Nailpolishes
662
1,019
9.0
Mouthwashes
799
856
1.4
Toothbrushes
741
802
1.6
374
410
1.9
Shavingproducts
373
402
1.5
340
371
1.8
Dentureproducts
318
322
0.3
Babycareproducts
288
303
1.0
271
264
(0.5)
169
220
5.4
163
195
3.7
40,372
46,829
3.0
Total
CAGR,%
395
396
Outlook
Table343:DollarSalesofCosmeticsandToiletriesintheUnitedStatesbyProduct
Category,RankedbyForecastRateofGrowth,2012to2017
Category
CAGR,%
Nailpolishes
9.0
Suncareproducts
7.1
5.4
Facialtreatments
5.0
Eyemakeup
4.0
3.7
Fragrancesforwomen
3.5
Shampoos
3.1
Facemakeup
3.0
Conditioners
2.5
Fragrancesformen
2.5
2.4
1.9
1.9
Handandbodylotions
1.8
1.8
Toothbrushes
1.6
Shavingproducts
1.5
1.4
Mouthwashes
1.4
Toothpastes
1.2
1.1
Babycareproducts
1.0
0.4
Dentureproducts
0.3
(0.5)
Total
3.0
4A96
KLINESFUTUREVIEWSCENARIOFORECASTINGMODELFORTHEU.S.
COSMETICSANDTOILETRIESMARKET
METHODOLOGY
Three different sales scenarios reflecting total market growth through 2017 have been
developedbasedonKline&CompanysFutureViewForecastingMethodology.
Thethreegrowthscenariosbasecase,optimisticcase,andpessimisticcaseforecast
sales and growth rates for each product category and the entire market annually
through2017.
FutureViewForecastingMethodologycombinestheanalysisofindustryrelatedfactorsand
macroeconomicfactorstoarriveatthethreeforecastscenarios.
At the industry level, the three forecasts incorporate microeconomic analysis of
industrydevelopments,interviewswithindustryexperts,andKlinesexpertjudgment.
Industrydevelopmentsassessedincludetechnologicalchanges,productintroductions,
marketingandadvertisingexpenses,andchangesinconsumertastesandpreferences.
ThemacroeconomicanalysistakesintoaccounttheroleoffactorssuchasGDP,energy
pricesanddisposablepersonalincomesinshapingfuturecosmeticsandtoiletriessales.
INDUSTRYLEVELFACTORS
Manyoftheluxuryconsumershavetradedup,backtotheluxurybrands,whileacertain
segmentstillremainsskepticaloftheeconomicsituation.
Thissegmentofthepopulationplaysitsafebystickingtomassproducts,oratthemost
upgradingtotheuseofmasstigebrandsuntiltheeconomyrecoverscompletely.
398
Underthebestcasescenario,thecosmeticsandtoiletriesmarketwouldreturntoahealthy
growth.
Marketersaregoingtocontinuetoemphasizeontechnologicaladvancementsinorder
todrawconsumersattentionandenticethemtospendmoremoney.
Marketers are expected to increase their advertising budget significantly in the years
that follow to support the introduction of new products, and positively affect sales
growthinthecosmeticsandtoiletriesindustry.
Social media will continue to be a prominent medium adopted by marketers to
communicatewithconsumers.Facebook,Twitter,andYouTubeareusedbyalmostall
theleadingmarketerstoestablishaninstantconnectionwiththeconsumers,especially
the young audience. This young audience matures and spends more on brands they
follow.
Ecommerce will gain momentum and is likely to be a big growth driver for the
cosmeticsandtoiletriesindustryduetotheeaseofpurchaseofproducts.
Thenaturalmovementwillcontinuetobeabiggrowthdriverasconsumersrealizethe
disadvantagesofusingharshchemicalsusedinproductsandtheneedformaintaining
ahealthylifestyle.
Accordingtotheworstcasescenario,thenegativefactorsthatinfluencethemarketduring
therecessionof2009and2010willgainstrengthduringtheforecastperiod.
Consumersbecomevalueconsciousandoptforfamilysizedeconomicalproducts,and
buyonlynecessities.Also,tocutcoststheywoulduseonlyoneproductperfunction
insteadofusingdifferentbrandedproductsservingthesamepurpose.
The luxury trade class will decline as consumers look to cut corners. Consumers will
tradedowntousingmassbrandedproducts,therebycreatingalowersalesvolumefor
luxury brands sold primarily through departmental stores. The emergence of the
masstige segment further puts pressure on the department stores, but the dollar
valueofsuchproductslowersasthemarketisfloodedwiththem.
Privatelabelproductswillgainsalesduetotheiravailabilityatpricepointlowerthan
thatofferedbynationalbrands.
Marketerswouldreducetheiradvertisingexpenses,whichmightresultinsalesdecline
forafewmarketers.
MarketerswillbelesslikelytoinnovateastheR&Dexpendituredeclines,resultingin
lessernewproductlaunchesperyear.
Mature categories such as personal cleansing products, hand and body lotions,
antiperspirants and deodorants, denture products, and baby care categories will
experiencedifficultieswithdownwardpricepressures.
Thesmallercompanieswillcontinuetolacktheadvertisingbudgetandfinancialbackingto
competedirectlywiththelargemarketers,suchasProcter&Gamble,LOral,andUnilever,
therebyhintingataclosure,merger,orbeingopenforacquisition.
4A98
MACROECONOMICFACTORS
Underthebestcasescenario,theeconomyrecuperatesfasterthantheexpectedtimeframe.
The global economy stabilizes and helps strengthen the U.S. economy without any
externalpressure.
Another pivotal factor that will contribute to the economic recovery is the
manufacturingindustry,whichwillhelpcombattheproblemofrecession.
Consumers will gain confidence in spending and further help improve the economy.
Luxury consumers, who had traded down during unfortunate times, will go back to
purchasingluxuryproductswithapremiumprice.
The initiatives taken by the federal government, including various fiscal stimulus
packages,willstrengthentheeconomicactivity.
The worst case scenario expects the economy is most likely to remain vulnerable to the
economicdownturn.
Theglobaleconomyislikelytobeaffectedandslowdownduetothedebtcrisisinthe
Europeancountries.
ThereisapossibilityoftheU.S.economyplungingintorecessionagain,iftheeconomy
undergoesanymajorsetbacks.
The continued situation around unemployment will have a detrimental effect on the
consumersconfidencetherebylimitingtheirdesiretospend.
Consumers will minimize their discretionary spending, as they experience a loss of
disposablepersonalincome.
The real estate sector would waver again, and more foreclosures and lower home
valueswillplungethenationintoadelayedrecovery.
Major marketers limit their spending across the board, and mergers and acquisitions
activitycomestoagradualhalt.
OVERALLCOSMETICSANDTOILETRIESINDUSTRY
Undertheoptimisticscenario,themarketforcosmeticsandtoiletriesintheUnitedStatesis
projected to grow at a compound annual growth rate (CAGR) of 4.4% to reach
The pessimistic scenario forecasts industry sales to reach $40,880million in 2017, up at a

CAGRof0.3%from$40,372millionin2012.
399
3100
Figure341:FutureViewScenarioForecastsforCosmeticsandToiletriesIndustrySalesintheUnitedStates,2012
to2017
$Million
60,000
Bestcase,CAGR,4.4%
50,000
Basecase,CAGR,3.0%
40,000
Worstcase,CAGR,0.3%
30,000
20,000
10,000
0
2012
2013
2014
2015
2016
2017
NOTE:Currentsales=$40,372Million
FRAGRANCES
Sales in the fragrances product class are projected to grow at a CAGR of 4.2% under the
optimisticscenario,reaching$4,700millionin2017.
Thepessimisticscenarioprojectsanegativeannualrateof0.7%forfragrancesduringthe
forecastperiod.
Saleswilldeclineto$3,690millionin2017,downfrom$3,818millionin2012.
Figure342:FutureViewScenarioForecastsforFragranceSalesintheUnitedStates,2012to2017
$Million
5,000
Bestcase,CAGR,4.2%
4,500
Basecase,CAGR,3.2%
4,000
Worstcase,CAGR,(0.7)%
3,500
3,000
2,500
2,000
1,500
1,000
500
0
2012
2013
2014
2015
2016
2017
4A100
HAIRCAREPRODUCTS
Hair care products are projected to grow at a healthy CAGR of 3.8% during the forecast
periodundertheoptimisticscenario.
Saleswillgrowfrom$7,610millionin2012to$9,150millionin2017.
Thepessimisticscenarioprojectssalestototal$7,730millionataCAGR0.3%.
Figure343:FutureViewScenarioForecastsforHairCareProductSalesintheUnitedStates,2012to2017
$Million
10,000
Bestcase,CAGR,3.8%
9,000
8,000
Basecase,CAGR,2.1%
7,000
Worstcase,CAGR,0.3%
6,000
5,000
4,000
3,000
2,000
1,000
0
2012
2013
2014
2015
2016
2017
MAKEUPPRODUCTS
MakeupproductsareprojectedtogrowataCAGRof5.8%duringtheforecastperiodunder
theoptimisticscenario.
Saleswillgrowfrom$7,657millionin2012to$10,128millionin2017.
Thepessimisticscenarioprojectssalestototal$7,780millionataCAGRof0.3%.
3101
3102
Figure344:FutureViewScenarioForecastsforMakeupProductSalesintheUnitedStates,2012to2017
$Million
12,000
Bestcase,CAGR,5.8%
10,000
Basecase,CAGR,3.8%
8,000
Worstcase,CAGR,0.3%
6,000
4,000
2,000
0
2012
2013
2014
2015
2016
2017
ORALCAREPRODUCTS
Undertheoptimisticscenario,oralcaresalesareprojectedtoincreaseataCAGRof2.7%to
reach$4,856millionin2017,upfrom$4,252millionin2012.
Underthepessimisticscenario,salesintheoralcareproductclasswillreach$4,230million
in2017atanegativeannualrateof0.1%from$4,252millionin2012.
Figure345:FutureViewScenarioForecastsforOralCareProductSalesintheUnitedStates,2012to2017
$Million
6,000
Bestcase,CAGR,2.7%
5,000
Basecase,CAGR,1.2%
4,000
Worstcase,CAGR,(0.1)%
3,000
2,000
1,000
0
2012
2013
2014
2015
2016
2017
4A102
SKINCAREPRODUCTS
Under the optimistic scenario, sales of skin care products are projected to advance at a
CAGRof5.6%toreach$13,680millionby2017.
ThepessimisticscenarioforecastssalestoadvanceataCAGRof1.0%fortheproductclass
toreach$10,950millionby2017.
Figure346:FutureViewScenarioForecastsforSkinCareProductSalesintheUnitedStates,2012to2017
$Million
16,000
Bestcase,CAGR,5.6%
14,000
Basecase,CAGR,4.5%
12,000
Worstcase,CAGR,1.0%
10,000
8,000
6,000
4,000
2,000
0
2012
2013
2014
2015
2016
OTHERTOILETRIES
Intheoptimisticscenario,othertoiletriesareprojectedtogrowataCAGRof2.5%toreach
Underthepessimisticscenario,salesofothertoiletriesareexpectedtodeclineanannual
rateof0.3%toreach$6,500millionin2017.
3103
3104
Figure347:FutureViewScenarioForecastsforOtherToiletryProductSalesintheUnitedStates,2011to2016
$Million
7,600
Bestcase,CAGR,2.5%
7,400
7,200
Basecase,CAGR,1.7%
7,000
6,800
6,600
Worstcase,CAGR,(0.3%)
6,400
6,200
6,000
5,800
5,600
2011
2012
2013
2014
2015
2016
2017
4A104
TheProducts
SectionFour
TheProducts
SectionFourof
ContinuingService
CARRIEMELLAGE
KlineMarketResearch
+19734353412
SPECIALNOTICE


company.

employees of subscribing companies and their subsidiaries, as defined above, until
June1,2016. Similarly, all sections of the survey are so restricted for three years from their
datesofissue.Failuretopreventunauthorizeddisclosurebeforethesedateswillresultinlegal
actionagainstthesubscriber.
Kline&Company,Inc.
Servingthe
Strategicanalyses
4A4
TABLEOFCONTENTS
Page
4A.INTRODUCTION............................................................................................................4A1
Reportcontents.............................................................................................................4A1
Restatedsalesestimates................................................................................................4A2
Productcategorydescriptions.......................................................................................4A3
Fragrances......................................................................................................................4A3
Haircareproducts..........................................................................................................4A4
Makeup..........................................................................................................................4A7
Oralcareproducts.........................................................................................................4A9
Skincareproducts........................................................................................................4A11
Othertoiletries.............................................................................................................4A13
4B.THEMARKET.................................................................................................................4B1
Totalsales......................................................................................................................4B1
Growth...........................................................................................................................4B1
4C.FRAGRANCES................................................................................................................4C1
Introduction...................................................................................................................4C1
Manufacturerssales......................................................................................................4C1
Retailsales.....................................................................................................................4C3
Competition...................................................................................................................4C3
Retaildistribution..........................................................................................................4C4
Outlook..........................................................................................................................4C5
FragrancesforMen.......................................................................................................4C9
Categoryperformance...................................................................................................4C9
Categorydevelopment................................................................................................4C15
Categorysegmentation................................................................................................4C19
Competition.................................................................................................................4C19
Retaildistribution........................................................................................................4C22
Marketingactivity........................................................................................................4C23
Outlook........................................................................................................................4C25
FragrancesforWomen................................................................................................4C27
Categoryperformance.................................................................................................4C27
Categorydevelopment................................................................................................4C34
Categorysegmentation................................................................................................4C40
Competition.................................................................................................................4C41
Retaildistribution........................................................................................................4C44
Marketingactivity........................................................................................................4C45
Outlook........................................................................................................................4C48
REPRODUCTION ORDISCLOSUREFORBIDDEN;SEESPECIALNOTICE KLINE&COMPANY,INC.
TABLEOFCONTENTS
(Continued)
Page
4D.HAIRCAREPRODUCTS..................................................................................................4D1
Introduction...................................................................................................................4D1
Manufacturerssales......................................................................................................4D1
Retailsales.....................................................................................................................4D2
Competition...................................................................................................................4D3
Retaildistribution..........................................................................................................4D6
Outlook..........................................................................................................................4D7
Conditioners...............................................................................................................4D11
Categoryperformance.................................................................................................4D11
Categorydevelopment................................................................................................4D14
Categorysegmentation................................................................................................4D18
Competition.................................................................................................................4D19
Retaildistribution........................................................................................................4D22
Marketingactivity........................................................................................................4D22
Outlook........................................................................................................................4D24
EthnicHairCareProducts............................................................................................4D27
Competition.................................................................................................................4D35
Outlook........................................................................................................................4D39
HairColoringProducts................................................................................................4D41
Competition.................................................................................................................4D47
Outlook........................................................................................................................4D51
HairStylingProductsandSprays.................................................................................4D55
Competition.................................................................................................................4D62
Outlook........................................................................................................................4D66
4A2
TABLEOFCONTENTS
(Continued)
Page
4D.HAIRCAREPRODUCTS(Continued)
Shampoos...................................................................................................................4D69
Competition.................................................................................................................4D77
Outlook........................................................................................................................4D83
4E.MAKEUP.......................................................................................................................4E1
Introduction...................................................................................................................4E1
Manufacturerssales......................................................................................................4E1
Retailsales.....................................................................................................................4E3
Competition...................................................................................................................4E3
Retaildistribution..........................................................................................................4E7
Promotion......................................................................................................................4E8
Outlook........................................................................................................................4E10
EyeMakeup................................................................................................................4E13
Categoryperformance.................................................................................................4E13
Categorydevelopment................................................................................................4E16
Categorysegmentation................................................................................................4E19
Competition.................................................................................................................4E20
Retaildistribution........................................................................................................4E22
Marketingactivity........................................................................................................4E23
Outlook........................................................................................................................4E25
FaceMakeup..............................................................................................................4E27
Categorysegmentation................................................................................................4E32
Competition.................................................................................................................4E32
Outlook........................................................................................................................4E38
TABLEOFCONTENTS
(Continued)
Page
4E.MAKEUP(Continued)
NailPolishes...............................................................................................................4E55
Competition.................................................................................................................4E59
Outlook........................................................................................................................4E63
4F.ORALCAREPRODUCTS..................................................................................................4F1
Introduction...................................................................................................................4F1
Manufacturerssales......................................................................................................4F1
Retailsales.....................................................................................................................4F2
Competition...................................................................................................................4F3
Retaildistribution..........................................................................................................4F5
Outlook..........................................................................................................................4F6
DentureProducts.........................................................................................................4F11
Categoryperformance.................................................................................................4F11
Categorydevelopment................................................................................................4F12
Categorysegmentation................................................................................................4F14
Competition.................................................................................................................4F15
Retaildistribution........................................................................................................4F17
Marketingactivity........................................................................................................4F17
Outlook........................................................................................................................4F18
LipBalms,Jellies,andTreatments...............................................................................4F21
Competition.................................................................................................................4F25
Outlook........................................................................................................................4F29
Mouthwashes..............................................................................................................4F31
Competition.................................................................................................................4F34
Outlook........................................................................................................................4F37
4A4
TABLEOFCONTENTS
(Continued)
Page
4F.ORALCAREPRODUCTS(Continued)
Toothbrushes...............................................................................................................4F39
Competition.................................................................................................................4F43
Outlook........................................................................................................................4F46
Toothpastes.................................................................................................................4F49
Competition.................................................................................................................4F55
Outlook........................................................................................................................4F59
ToothWhiteningProducts...........................................................................................4F63
Competition.................................................................................................................4F66
Outlook........................................................................................................................4F69
4G.SKINCAREPRODUCTS..................................................................................................4G1
Introduction...................................................................................................................4G1
Manufacturerssales......................................................................................................4G1
Retailsales.....................................................................................................................4G3
Competition...................................................................................................................4G3
Retaildistribution..........................................................................................................4G7
Outlook..........................................................................................................................4G7
TABLEOFCONTENTS
(Continued)
Page
4G.SKINCAREPRODUCTS(Continued)
BabyCareProducts.....................................................................................................4G11
Categoryperformance.................................................................................................4G11
Categorydevelopment................................................................................................4G13
Categorysegmentation................................................................................................4G16
Competition.................................................................................................................4G18
Retaildistribution........................................................................................................4G20
Marketingactivity........................................................................................................4G20
Outlook........................................................................................................................4G21
FacialTreatments.......................................................................................................4G23
Competition.................................................................................................................4G37
Outlook........................................................................................................................4G48
HandandBodyLotions...............................................................................................4G53
Competition.................................................................................................................4G60
Outlook........................................................................................................................4G69
SkinCareProductsforMen.........................................................................................4G73
Competition.................................................................................................................4G78
Outlook........................................................................................................................4G82
SunCareProducts.......................................................................................................4G85
Competition.................................................................................................................4G99
Privatelabel..............................................................................................................4G103
Outlook.....................................................................................................................4G107
4A6
TABLEOFCONTENTS
(Continued)
Page
4H.OTHERTOILETRIES........................................................................................................4H1
Introduction...................................................................................................................4H1
ManufacturersSales.....................................................................................................4H1
RetailSales.....................................................................................................................4H3
Competition...................................................................................................................4H3
RetailDistribution..........................................................................................................4H9
Outlook..........................................................................................................................4H9
DeodorantsandAntiperspirants.................................................................................4H13
Categoryperformance.................................................................................................4H13
Categorydevelopment................................................................................................4H15
Categorysegmentation................................................................................................4H19
Competition.................................................................................................................4H20
Retaildistribution........................................................................................................4H24
Marketingactivity........................................................................................................4H25
Outlook........................................................................................................................4H28
Depilatories,Waxes,andBleaches..............................................................................4H31
Competition.................................................................................................................4H37
Outlook........................................................................................................................4H42
PersonalCleansingProducts.......................................................................................4H45
Competition.................................................................................................................4H67
Outlook........................................................................................................................4H74
TABLEOFCONTENTS
(Continued)
Page
4H.OTHERTOILETRIES(Continued)
ShavingProducts........................................................................................................4H77
Competition.................................................................................................................4H84
Outlook........................................................................................................................4H89
4A8
4A.INTRODUCTION
REPORTCONTENTS
The Products section presents market profiles of 26 major cosmetic and toiletry categories.
These analyses summarize important market activity for each category in a brief, concise
fashion.Datapresentedareestimatesofaccuracylevelsthataresatisfactoryforscreeningand
planningpurposes.Therefore,whenmorepreciseinformationisrequired,asinthedecisionto
launch a new product or brand, more detailed studiesthose specifically designed for the
particularcaseshouldbeundertaken.
Productcategoriesaregroupedintosixmajorproductclassesfragrances,haircareproducts,
makeup products, oral care products, skin care products, and other toiletriesand are listed
alphabetically within each product class. Each category of the 2012 report contains the
followinginformation:
Category performance. Reports the categorys sales performance at the manufacturer,

retail,andunitlevels.
Categorydevelopment.Asummaryofkeytrends,developments,andnewproductactivities
thataffectedthecategory.
Categorysegmentation.Whereapplicable,ananalysisofthecompanyssalessegmentedby
tradeclass,producttype,and/orproductform.
Competition.Theapproximatebreakdownofmanufacturerssalesorbrandsharesthrough
consumeroutletsindollarsbybrandandrelateddiscussionofperformanceduringtheyear.
Includesprivatelabelactivity.
Retail distribution. The approximate percentages of dollar sales sold by major types of
outlets.
Marketing activity. A description of various promotional vehicles employed by major
marketers.Traceablemediaexpenditures(TME)arepresentedinChapter7ofthisstudy.
Outlook.AfiveyearforecastofmanufacturerssalesofthecategorythroughU.S.consumer
outlets, estimated on the same basis as the market data for the base year. Forecasts are
made in units and in constant dollars. The forecasts are based on our interviews with
suppliersinthemarket,pastgrowthpatterns,trendsinthemarket,thelikelihoodofnew
productintroductions,andchangesinpopulation,disposableincome,andconsumertastes,
amongotherfactors.
Percentagetotalsoncertaintablesmaynotalwaysaddduetorounding.
4A2
Introduction
RESTATEDSALESESTIMATES
Certainproductcategoryandbrandsalesestimatesinthiseditionofthereportreflectvalues
thathavebeenrevisedorrestatedfromthepreviousedition.Theserestatementsarearesult
ofadditionaltimedevotedtothecompleteandaccurateresearchingofsalesestimatesandthe
inclusionofotherdistributionchannelswithbroaderproductrepresentation.Theultimategoal
is to quantify the cosmetics and toiletries industry in an accurate, complete, and logical
manner,capturingallU.S.consumerpurchases.
4A2
Introduction
PRODUCTCATEGORYDESCRIPTIONS
FRAGRANCES
Fragrancesformen
Therearemanyformsofliquidfragranceproductsformen:
Eau de toilettes are diluted alcoholic solutions of perfumes, and eau de parfums
containfragrancesinmoreconcentratedforms.
Colognes contain more concentrated solutions of essential oils than aftershaves and
thereforeleavealongerlastingfragrance.Theyareusedtofreshentheskinandimpart
amasculinescent,frequentlyaftershavingorshowering.
Aftershaves, available in a variety of products, are lower in fragrance concentration
thancolognes.Aftershavesarebasicallyfragranceproductsthatalsosootheandheal
razornicksandconditionandinvigoratetheskinaftershaving.Productsareavailable
asliquids,lotions,andgels.
Ancillaryproductsareusuallyfeaturedaslineextensionsoftheliquidfragranceandinclude
fragrancedsoaps,deodorantsandantiperspirantsscentedwithabrandedmensfragrance,
fragrancedtalcumpowders,skincareproducts,andhaircareproducts.
ToiletryproductsfrommasstoiletrybrandssuchasOldSpice,GilletteSeries,andBrutare
notcoveredinthisanalysis.
Salesforliquidfragranceproductsforthesebrandsareincludedhere.
Bodysprays,suchasAxe,arenotincludedinthisanalysis.
Thesebrandsarecoveredinthedeodorantsandantiperspirantscategory.
Fragrancesforwomen
Womens fragrance products include perfumes, toilet waters, colognes, deocolognes, and
bodysplashes.
Perfumescontainfragrancesinrelativelyconcentratedforms.
Toiletwatersaredilutedalcoholicsolutionsofperfumes.
Colognes are similar to toilet waters but historically contain less fragrance; however,
many of todays colognes are concentrated and contain more perfume oil than toilet
watersdo.
Deocolognes are low in perfume concentration and are applied through an aerosol
spray.
Bodysplashesandmistsarethelowestinfragranceconcentration.
Solids are available in pressed powder or soft solid form and typically come in
compacts,pots,orsticks.
4A3
4A4
Introduction
Ancillaryproductssuchasdustingpowders,bodylotions,andbathadditives,whicharepart
ofafragranceline,arecoveredinthisprofileaswellasintheirrespectivecategoriesinthis
report.
Unisexfragrances,suchasCKOne,arecoveredinthiscategory.
HAIRCAREPRODUCTS
Allhaircareproductsalesreportedareforathomeuseonly.
Forprofessionaluse(backbarsales),refertoKlinesSalonHairCarereportseries.
Conditioners
Conditioners are used to moisturize and treat the hair and are generally available in a
varietyofformulasdesignedfornormal,dry,oily,andothertypesofhair.
Formulasmayalsobedesignedforhairtextureorendresult,suchascurly,straight,or
volumizing.
Morerecently,productsarebeingintroducedtoprovideotherbenefits,suchascolor
protectionorshineenhancement.
Mostconditionersareinstantproductsthatareappliedtothehairafterwashingandare
leftonthehairforonetothreeminutesbeforerinsing.
Alsoincludedaretherapeuticconditioners,whichareformulatedtoprovidemoreintensive
treatmenttothehair.
Suchproductsarealsooftencalledconditioningtreatmentsordeepconditioners.
Productsareoftenusedtotreathairthatisdamageproneorexcessivelydry.
Therapeutic or deep conditioning products are typically left on the hair for 5 to 20
minutesbeforerinsing.
Someproductsrequirenorinsing.
Somedeepconditioningproductsareavailableinsingleusepackets.
Inadditiontosalesgeneratedbymassbrands,ourcategorydefinitionandmarketsizedata
include:
SalonbrandssuchasMatrix(LOral);theseproductsderivethemajorityoftheirsales
from salons, although some volume is also generated from sales in mass outlets and
throughtheInternet.
Minor sales of conditioners also come from direct sales companies such as Avon,
prestigecompaniessuchasEsteLauder,andspecialtymarketerssuchasBath&Body
Works(LimitedBrands).
4A4
Introduction
Combination products that contain both shampoo and conditioner are included in the
shampooscategory.
Ethnic hair care products are specially designed to be effective for AfricanAmerican hair;
thefivemaintypesaredescribedbelow.
Relaxerkits(alsocalledperms)aredesignedtoremovecurlfromthehair,eithertotallyor
partially.
Styling aids serve a variety of functions and include products designed to counteract the
drynessproducedfromarelaxer.
Theseproductsholdthehairinplace,aswellaslubricatethescalp,preventdamage,
conditionandmoisturizethehair,andalloweasierstyling.
Suchproductsincludepressingaids,settinglotions,andhairtonics,aswellasspritzes,
gels,andmoussesthatarespeciallyformulatedforethnichair.
Dresses and lotions are typically petrolatumbased and are designed to add a wavy
appearancetothehairorholditinaparticularstyle.
Productsincludehairdressingconditioners,pomades,andtemporarywaveproducts.
Thissegmentincludesproductsspeciallyformulatedformensgrooming.
Curlmaintenanceproductsenhanceormaintainthecurlproducedbyacurlingproduct.
These products hold the hair in place as wellas lubricate the scalp, prevent damage,
andconditionandmoisturizethehair.
Such products include curl moisturizers, curl activators and restorers, combout
conditioners,curlmoisturizingsprays,andoilsheens.
Curl/wave kits are designed to add curl and body to the hair, help it set better and hold
longer.
Sales of other consumer products positioned specifically for ethnic consumers, such as
shampoos,conditioners,andhaircolorants,arealsoincludedinthiscategory.
4A5
4A6
Introduction
Haircoloringproductsaredesignedtocolorhair,eithertemporarilyorpermanently.There
arebasicallyfivetypesofhaircoloringproducts:
Permanentdyesprovidelongtermcolortohairandlastuntilnewhairgrowsout.
Semipermanent dyes highlight naturally colored hair or color gray hair without
bleachingaction.Theyaretypicallyappliedasshampooandremainonthehairthrough
severalwashings.
Permanentdemipermanentdyesprovideuptosixweeksofsheerhaircolortoblend
away gray hair without ammonia and without changing the natural color of the hair.
Productisleftinthehairforapproximatelyfiveminutes.
Special effects include lighteners, frosting products, and highlighting kits that are
usuallyappliedtoselectstrandsofhair.
Temporary colorants include rinses, shampoos, mousses, and gels that produce a
cosmetic change in the shade of hair and can be easily removed in one or more
shampoos.Theseproductsdonotpenetratethehairshaftandarenotasharmfulas
othercoloringproducts.
Thehairstylingproductscategorycoversavarietyofproductsforcontrollingandenhancing
theappearanceofbothmensandwomenshair,includingthefollowing:
Styling gels are used to style and hold hair in place. Gels are applied after hair is
washedandareleftonthehairwhileitisbeingsetorstyled.
Stylingmoussesperformthesamefunctionasgelsbutalsoprovidebodytothehair.
Productsareavailableasaerosolfoamsandareappliedtoeitherwetordryhair.
Spritzesandotherheavystylingspraysarehighlevelresinfixatives,typicallyappliedto
either wet or damp hair to aid in the styling or sculpting of the hair. Such products
produce greater hold and stiffness and generally result in a less natural look than
traditionalaerosolhairsprays.
Stylinglotionsarewaterorwater/alcoholliquid,gellikeformulasavailableinbottlesor
tubes. A glaze is a variety of lotion that usually imparts more shine and hold than a
lotion.
Hair volumizers and thickeners give hair volume and an overall thicker, fuller
appearance.
Treatmentsimprovethehairsoverallmanageability.Productusagenormallyrequires
anextrastepinadditiontoroutinecleansingandconditioningofhair.Usageofthese
products has proliferated recently to include generaltreatment products as well as
onesthataregearedtowardspecifichairtypes,suchasdamaged,fine,orcolortreated
hair.
Retexturizingproductsmakecoarseorfrizzyhairsmoothand,insomecases,straight.
Shine enhancers are mists or serums that add shine to hair. Many of these products
alsocontainsunprotectioningredients.
Mens grooming products help men maintain a certain hairstyle. These products are
typicallyformulatedastonicsandcreams.
Stylingproductsinotherforms,suchaspomades,putty,waxes,sticks,andpastes,are
also included in this category. These product forms generally provide control, shine,
andareusedfrequentlyfortexturedeffects.
4A6
Introduction
Hairspraysareusuallyappliedafterstylingthehairtohelpholditinplace.
Sprays are available in varying degrees of holding power, in scented or unscented
formulations,andinaerosolorpumpcontainers.
Shampoos
Shampoosareusedtocleansethehairandscalpandareavailableinavarietyofformulas.
Someshampoosaredesignedtoworkbestonnormal,dry,oroilyhair.
Others are developed for certain hair colors such as blonde, brunette or redhead, to
helpprotectandenhancecolor.
Antidandruffformulationshelpcontrolflakyscalp.
Someproductsmaycontainconditionersorshineagentsandmayalsobecalledtwo
inoneorthreeinoneproducts.
Childrensproductsareespeciallygentle.
MAKEUP
Eyemakeup
Eyemakeupconsistsofthefollowingproducts:
Eyeshadow,whichisusedontheeyelidorundertheeyebrowtogivetheappearance
of a shadow, is available in such forms of sticks, cakes, liquids, pencils, or brushons,
andinavarietyofcolorsandattributes.
Mascara is used on eyelashes to darken, color, and/or thicken. Mascaras that are
colorlessorsheertintedarealsoincluded.
Otherproductsincludeeyebrowproducts,whichareusedtodarkenandadddefinition
to eyebrows; eyeliners, which are used to line or darken the eyelid; and eye lining
pencils,whichareusedtoaddcoloraboveand/orbelowtheeyelid.
Productssuchasartificialeyelashes,tweezers,andotherimplementsarenotincluded.
Eyemakeupremoversarecoveredinthemiscellaneousproductscategory.
Facemakeup
Facemakeupisappliedtothefacetocreatesmoothandpolishedlook.
Products covered in this section are makeup bases, face powders, blushers, and
concealers.
Makeup bases or foundations are applied to the face before other makeup products
such as powders and blushers. Twoinone products that can be applied dry like a
powder or wet like a base are also included in this category. Bases are available in
different textural finishes including lotions, creams, cakes, gels, aerosols, sticks, or
mousses, and in medicated or hypoallergenic formulations. Some products like
concealersmorethoroughlycoverskinimperfections.
4A7
4A8
Introduction
Facepowdersareformulatedtolightlycoverthefaceorothermakeuptoimpartsubtle
color, provide an even appearance, and help control shine and oil. Products are
traditionallyavailableinpressedcakeorloosepowderforms.
Blushers are applied to the face to add color, usually after a concealer and makeup
base has been applied. Products are available in several forms, the most common of
whichisbrushonpowder.Otherformsincludecream,gel,liquid,stick,pencil,bronzer,
andmousse.
Coversticksandconcealersarealsoincludedinthiscategory.
Concealersformulatedtotreatskinrelatedproblemsarenotcoveredinthissection.
Lipsticksandlipglossescolor,moisturize,addshine,protectthelips,andcanalsoalterthe
apparentshapeofthelips.
Lipsticks are soft solids that are most typically applied in stick form but are also
availableincompactsandlargepencils.
Lip glosses, which range from liquids to very soft solids, are sold in small jars, pots,
compacts,tubes,androlloncontainers.
Liplinersaretypicallyusedtooutlinethelipstogivethemgreaterdefinition.
Lipbalmsandjelliesareanalyzedseparatelyaspartoftheoralcareproductsclass.
Nailpolishes
Nailpolishesincludethreesubcategories:
Enamels, which gives color and gloss to the fingernails and strengthen them against
breaking.Productscomeinvariousshadesandcolors.
Basecoats,whichareapplieddirectlyonthenailbeforeenamel.Ridgefillersareatype
ofbasecoatthatisspeciallydesignedtoensurethatthenailsurfaceiscoatedevenly.
Topcoats,whichareappliedafterpolishing,tosealtheenamelandprovideprotection
againstchipping.
Multifunctionalproductswhichincorporatealloftheabovebenefitsarealsoincluded.
Topcoatsandbasecoatsmaybeusedalonebutaremorecommonlyusedinadditiontonail
enamel.
Some clear coats are positioned as threeinone coats for use before and after nail
polish,orevenalone.
Nail hardeners are products specifically formulated to provide added durability. Nail
hardenersthatcontaincolorandthosethatarepositionedasbasecoatsareincludedinthe
nailpolishescategory.
Thiscategorydoesnotincludeartificialnails,nailtreatments,nailpolishremovers,orany
nailcareimplements.
4A8
Introduction
ORALCAREPRODUCTS
Dentureproducts
Cleansers are available in tablet, cream, gel, powder, and crystal forms and are used to
removefoodanddebrisfromdentures.
Adhesivesareavailableascreams,powders,liquids,andstripsandaredesignedtosecure
denturesinplace.
Denturelinersandcushionsarenotincludedaspartofthisanalysis.
Lipbalmsprotectthelipsagainstchappingduringcoldweatheranddryinginwarmweather.
Products are available in natural, fruit, and other flavors, and with such benefits as
sunscreenandaddedvitamins.
LipbalmsmarketedbysuchsuncarebrandsasBananaBoatrepresentminorsalesand
areincludedintheSunCareProductssectionofthisreport.
Lip balm brands that contain SPF such as ChapStick and Blistex are included in this
category.
Lipjelliesalsopreventchappinganddryingandaresimplyamoreconvenientlypackaged
methodofapplyingpetroleumjellytothelips.
Traditionalpetroleumjelly,whichisnotspecificallypackagedasalipcareproduct,is
not included in this category but is profiled in the miscellaneous products section of
thisreport.
Liptreatmentsconditionlips,smoothmouthlines,controlslipsticksmudgingandbleeding,
andgivelipsafullerappearance.Thisincludeslipplumpers.
Lip balm products that are marketed exclusively as ultratherapeutic products, such as
CamphoPhenique,Herpecin,andTanac,arenotcoveredinthisreportbutarediscussedin
NonprescriptionDrugsUSA.
Products where color is the primary benefit are covered in the lipsticks and lip glosses
categoryofthisreport.
4A9
4A10
Introduction
Mouthwashes
Mouthwashes,gargles,andrinsesareliquidproductsthatareusedtocleansethemouth,
fortifyteeth,andfreshenbreath.
In some cases, mouthwashes are also used to help treat or prevent sore throats and
coldsaswellascavities,plaque,andgumdisorders.
Mouthwashes, gargles, and rinses are generally positioned as breathfreshening,
antibacterial,orantiplaque,andsomearealsofluoridetreatments.
Breathfreshenerssuchassprays,arenotcoveredinthisreport.
Toothbrushes
Toothbrushesareusedtoapplytoothpastes,gels,anddentalcreamsforcleaning,polishing,
andwhiteningteeth,aswellascleansingthemouth.
Toothbrushescomeinavarietyofshapes,sizes,anddesigns.
Thecategory,however,isbroadlyclassifiedintotwosegments:childrenandadults.
Thechildrenssegmentcoverstoothbrushesdesignedforyouth,children,andtoddlers.
Thisreportincludesmanualandbatterypoweredbrushes.
Electrictoothbrushesarenotcoveredinthisreport.
Toothpastes
Toothpastesareusedtoclean,polish,andwhitentheteeth,aswellascleansethemouth,
sweetenthebreath,andreduceincidenceoftoothdecayandgumproblems.
Products are available primarily as pastes and gels, but are also sold as powders and
liquiddrops.
Toothwhiteningproductsareappliedtotheteethtoobtainalightershade.
Products are available primarily as whitening strips, brushon gels, and moldable
mouthpiecesortrays.
Thisreportcoversproductsforathomeuseonly.
4A10
Introduction
SKINCAREPRODUCTS
Babycareproducts
Babycareproductsaredesignedtosoothe,protect,andhealthetenderskinofinfantsand
youngchildren,particularlyskinthatisirritatedfromdiaperrashandchafing.
Thissegmentincludesbabybath,lotions,oils,andpowders.Excludedarebabyshampoos
anddiaperrashcreams.
Theseproductsarealsooftenusedbyadultsasbathoils,skinmoisturizers,skinsoothers,
andforeyemakeupremoval.
Facialtreatments
Facialtreatmentsperformvariousfunctionsand,whilesomeoverlapexists,mostproducts
aregroupedintooneofthefollowingsegments:
Moisturizers and treatments keep skin soft, firm, smooth, and often claim to protect
skin and reduce signs of aging. Such treatments as eye creams, serums, and acne
productsarealsoincludedhere.
Thecleanserssegmentconsistsofcleansers,masques,porestrips,andfacialcleansing
cloths.Cleansingcreams,lotions,gels,andbarscleansetheskinandremovemakeup.
Masquesaredesignedtocleanse,firm,purify,ormoisturizethefacebyexfoliatingskin,
absorbing oil, or providing moisturizing benefits, and are typically worn for several
minutes or overnight. Pore strips are designed to cleanse clogged pores and remove
blackheads by applying and removing a bandagelike strip. Facial cleansing cloths,
wipes, and towelettes are designed to cleanse the skin and remove makeup with or
withouttheuseofwater.
Acneaidsarecreamsandlotionsforcontrolofmildinfections,orotherskinblemishes.
Astringentsandtonersstimulatetheskin,helpremoveexcessoil,andcanalsoreduce
appearanceofporesize.
Makeupremoversarenowincludedasfacialtreatmentsinthisreport,whereasin2010
editionandpreviouslyitwasinmiscellaneousproducts.
Oilblottersandfacialtissuesthatdonotcontainacleansingagentarenotincludedinthis
report.
Handandbodylotions
Handandbodycreams,lotions,andtreatmentsaredesignedtopreservethenaturalbeauty,
youthfulfeel,andappearanceofskinandtoprotectagainstenvironmentalharm.
Productsareformulatedtosmoothandlubricate,moisturize,sootheandpreventdryness,
relievechapping,protectagainstexternaldamage,andsometimesexfoliate.
4A11
4A12
Introduction
Included are such specialty body treatments as skinfirming products, body masques, and
relatedproducts.
Fragrancelineextensionsofbodylotionsarealsoincluded.
Footcareproductsincludesmoothinglotionsandcreams,deodorizers,powders,exfoliating
scrubs,andwashesarealsoincluded.
Athletes foot products, fungicidal products, and corn and callus removers are not
included in this report but are discussed in Klines companion report Nonprescription
DrugsUSA.
Specialtyfootinsertsarealsoexcludedfromthisreport.
Skin care products for men include moisturizers, night creams, antiaging products, facial
and body cleansers, hand and body lotions, replenishing eye creams, exfoliating scrubs,
facialmasques,andaftersportstreatmentsmarketedspecificallytomen.
Thefollowingproductsarenotincludedinthiscategorybutarereportedintheirrespective
sectionsofthisreport:shavingcreamsandgels,personalcleansingproducts,deodorants,
andaftershaves.
Although men often use allpurpose or womens skin care products, such usage is not
includedhere.
Suncareproducts
Fivetypesofsuncareproductsareincludedhere,manyofwhichareavailableascreams,
gels,foams,lotions,oils,sprays,andsticks:
SuntanningproductswithSPF5andunder,whichpromotetanningoftheskinunder
sunlight.
Sunscreens with SPF6 to SPF14 and sunblocks with SPF15 and over, which can
eliminateupto99%ofthesunsultraviolet(UV)radiationandthuspreventburningor
prolongtanning.
Sunless tanning products, which represent two types of products: products that tan
withoutexposingtheskintothesun,andproductsthatalsocontainsunscreen.
Aftersun products, which often contain aloe vera and are designed to soothe and
moisturize sun exposed skin. Lip balms marketed by such sun care brands as Banana
Boat are included in the aftersun and other products segment of this category. Lip
balmbrandslikeChapStickandBlistexthatcontainSPFarereportedintheLipBalms,
Jellies,andtreatmentsproductcategory.
4A12
Introduction
SPFisthestandardmeasurementofasunscreenscapacitytoprotectagainstUVrays.
TheSPFnumberreferstotheeffectivenessofsuncarepreparationsinprotectingthe
skinfromtheharmfuleffectsofthesunsUVradiation.
ThewavelengthsoftheUVraysemittedbythesunlongalpha(UVA)raysandshort
beta(UVB)raysaffecttheskindifferently.
Facialmoisturizers,bodymoisturizers,makeup,andotherproductsthatareratedwithan
SPF but for which sun protection is considered a secondary benefit are included in their
respectiveproductcategorieswithinthisstudy.
OTHERTOILETRIES
Antiperspirantsaredesignedtoeitherinhibitorstoptheflowofperspirationandmayalso
preventodor.
Deodorantssuppressbacterialdecompositionthatcausesodor.
Deodorantsandantiperspirantsareofferedinmanyproductforms.
Solid sticks have an antiperspirant active powder suspended in a wax matrix and are
twistedupandappliedonusersskin;therearetwomaintypesofsolidsticks.Regular
solidsticksweretheoriginalsolidstickintroduced.Invisiblesolidsticksorsheersolids
aresolidstickswithasofterfeel.
Softsolidextrudablesextrudecreamysolidthroughmeshdome.
Gelsareeitherclearoropaqueandusuallyassociatedwithwetandcooling,butalsoa
morestickyandslipperyfeel.
Rollons are one of the original modern forms of antiperspirant delivery; aqueous
solutionsarerolloutontousersskinviaarollingball.
Aerosolsaresprayedontousersunderarmorotherareasofthebody.
Depilatoriesaredesignedtoremoveunwantedhairandareanalternativetoshaving.
Most depilatories contain an alkaline chemical that causes the hair shaft to separate
fromtheskinsothehaircanbewipedaway.
Theseproductsareofferedingels,creams,lotions,rollons,mousses,andaerosols.
Theseproductsareeffectiveforaboutsevendays.
4A13
4A14
Introduction
Waxesareappliedtounwantedhairandpeeledoff,removinghairdowntotheroot,not
justattheskinssurface.
Theseproductsareavailableinhotandcoldvarieties.
Someofthenewerwaxescontainsugar,whichissaidtohelptheremovalprocess.
Typically,theseproductsareeffectiveforthreetoeightweeksbeforeregrowthoccurs.
Bleachesareproductsthatfadehairratherthanremoveit.
Theseproductsaremostcommonlyusedinthefacialarea.
Theseproductsaretypicallyeffectivefortwotothreeweeks.
Not included in category sales are buffer products or epilettes, which are a more
mechanicalmeansofhairremoval/sloughing.
Otherminorproductformsarealsoavailable,suchaspaste,rockorcrystal,andwipe
ontowellettes.
Alsoexcludedareprofessionaluseproducts.
Personalcleansingproductsaredividedintosixproducttypes:
Bar soaps include traditional commodity soaps such as deodorant, moisturing, and
complexion soaps as well as specialty soaps such as highly fragranced and novelty
soaps.
Bodywashesaretypicallyforuseovertheentirebodyandareusedexclusivelyinthe
shower,inplaceofbarsoaps.
Pricepointsarehigherthancommoditybar,liquid,andsomelowerpricedspecialtysoaps.
Thissegmentdoesnotincludebathandshowergels;suchproductsarecoveredintheBath
Additivessegmentofthisreport.
Liquid soaps are usually available in pump packaging and often contain moisturizing
andconditioningagents.
Mostmanufacturersofferrefills.
Mechanicshandsoapsorwaterlesshandcleanersareexcludedfromthecategory.
4A14
Introduction
Liquid gels for use over the entire body, in the bath or shower, are covered in the Bath
Additivessectionofthisreport.
Antibacterialhandgelsorhandsanitizersaredesignedtofightoffgermsonthehands
withoutsoap,water,ortowelsinapproximately15seconds.
Most contain a bitter agent that has been added to discourage ingestion by pets or
children.
Bathadditivestypicallyofferthefollowingbenefits:
Softenwaterforgentleskincare.
Moisturize,sootheandsmoothskin.
Impartfragrancetowaterandapleasantatmospherearoundthebath.
Offertargetedaromachology/aromatherapeuticbenefits,suchasstressreduction.
Productsareofferedinthefollowingforms:
Bath liquids, grains, cream baths, cubes, salts, crystals, tablets, sachets, and mousses
areformulatedtoeithercreatefoamunderrunningbathwaterordissolveinthebath
tosoftenandperfumethewater.
Productsaretypicallysegmentedtoappealtoadults,teens,orchildren.
Bath and shower oils and gels are an extension of bubble baths, offering a high
moisturizingbenefitandleavingskinfeelingsoftandsmooth.
Fragrancebathadditivesaregenerallyincludedinpopularfragrancelines.
The bath additives section covers adult and childrens bath additives. Infant bath
additivesarediscussedseparatelyinthebabycarecategoryofthisreport.
Shavingproducts
Shavingproductsincludeshavingcreamsandsoapsandpreshavelotions.
Shaving creams and soaps, available in scented and unscented forms, are used to
softenthebeardbeforeshavingwitharazor.
Aerosol types, including foams and gels, are by far the most popular, but some
brushlessshavingproducts,lathercreams,andsoapsarestillsold.
Preshavelotionsareusedtocoatthebeardandlubricatetheskinbeforeshaving.
Razorsareexcluded.
4A15
4A16
Introduction
4A16
4B.THEMARKET
TOTALSALES
Sales of personal care products in the United States further advance in 2012 to reach
$40.3billion,upby3.4%from$39.0billionin2011.
Sales of individual product categories range from approximately $6.6 billion for facial
treatmentsto$163millionfordepilatories,waxes,andbleaches.
The six leading product categoriesfacial treatments, personal cleansing products, face
makeup,eyemakeup,fragrancesforwomen,andshampoosaccountformorethanhalfof
totalmarketsalesatthemanufacturerslevelin2012.
GROWTH
Themarketregistersagrowthof3.4%insalesin2012.
Leading companies continue to introduce new products with improved technologies,
supportingtheoverallgrowthofthepersonalcareindustryintheUnitedStatesin2012.
Other factors that support the growth include; aggressive promotional activities and
innovationsintermsofbothproductandpackaging.
Twentyfour product categories display growth while only two register a decline in sales
during2012.
Nailpolishescategorycontinuestopostthehighestgrowthin2012,upby17.4%.
Eight other product categoriesfacial treatments, fragrances for women, shampoos,
conditioners, sun care products, lip balms, jellies, and treatments, skin care products
formen,anddepilatories,waxes,andbleachesregistergainsof4.0%ormore.
4B2
TheMarket
Table4B1:ManufacturersSalesofCosmeticsandToiletriesintheUnitedStatesbyProduct
$Million
Productcategory
2011
2012
Change,%
Facialtreatments
6,360
6,645
4.5
Personalcleansingproductsr
3,907
4,026
3.0
Facemakeupr
2,804
2,909
3.7
Fragrancesforwomen
2,612
2,717
4.0
Eyemakeupr
2,621
2,709
3.4
Shampoosr
2,501
2,620
4.8
Handandbodylotionsr
2,240
2,283
1.9
1,999
2,040
2.1
Toothpastes
1,719
1,749
1.7
1,658
1,680
1.3
Conditionersr
1,578
1,653
4.8
Lipsticksandlipglossesr
1,352
1,377
1.8
Haircoloringproductsr
1,323
1,317
(0.5)
Fragrancesformen
1,063
1,101
3.6
Suncareproductsr
984
1,048
6.5
Mouthwashes
782
799
2.2
Toothbrushes
725
741
2.2
Nailpolishesr
564
662
17.4
Lipbalms,jellies,andtreatmentsr
357
374
4.8
Shavingproducts
362
373
3.0
Ethnichaircareproductsr
333
340
2.1
Dentureproducts
314
318
1.3
Babycareproducts
283
288
1.8
287
271
(5.6)
Skincareproductsformenr
154
169
9.7
144
163
13.2
39,026
40,372
3.4
Totalr
rRestated.
4A2
4C.FRAGRANCES
INTRODUCTION
Included in this section are womens fragrances, which includes perfumes, toilet waters,
bodysplashes,colognes,andbodymistsandmensfragrances,whichincludesaftershaves,
colognes,andbodysplashes.
Allancillaryfragranceproductsarealsoincluded.
MANUFACTURERSSALES
Total manufacturers sales of fragrances grow by 3.9% from $3,675million in 2011 to

$3,818millionin2012,withincreasesacrossboththemensandwomenscategories.
Sales of fragrances for women increase by 4.0% to $2,717million, while sales of
fragrancesformenincreaseby3.6%to$1,101millionin2012.
Fragrancesforwomenaccountfor71.2%oftotalsales,whilefragrancesformenmake
upthebalance.
Figure4C1:ManufacturersSalesofFragrancesintheUnitedStates,2012
Fragrancesfor
women,71.2%
Fragrancesfor
men,28.8%
Total:$3,818Million
4C2
Fragrances
Historicalsales
Saleshavedeclinedatacompoundannualgrowthrate(CAGR)of0.4%from$3,886million
in2007to$3,818millionin2012.
Table4C1:HistoricalSalesofFragrancesintheUnited
States,2007to2012
Year
$Million
Change,%
2007
3,886
2008
3,654
(6.0)
2009
3,389
(7.2)
2010
3,468
2.3
2011
3,675
6.0
2012
3,818
3.9
Salesbyproducttype
Liquid products, including colognes, perfumes, aftershaves, and body mists and splashes,
accountfor90.6%oftotalfragrancesalesin2012,up3.9%from2011.
Ancillaryproducts,suchasbodylotions,bathadditives,andperfumeddeodorants,account
for9.4%oftotalsales.
Ancillaryproductsgrowasvaluesetsgrowinpopularity.
Table4C2:ManufacturersSalesofFragrancesintheUnitedStatesbyProductType,2011and2012
Producttype
Liquidproducts
Ancillaryproducts
Total
$Million
%Oftotal
2011
2012
2011
2012
Change,%
3,329
3,458
90.6
90.6
3.9
346
360
9.4
9.4
4.0
3,675
3,818
100.0
100.0
3.9
Salesbytradeclass
Theluxurytradeclassaccountsforthelargestportionoffragrancesales,witha61.6%share
in2012,upfroma60.7%sharein2011.
The specialty trade class continues to grow, reaching a share of 21.3% in 2012, up from
20.8%in2011.
Themassanddirecttradeclassescontinuetolosesharein2012.
4A2
Fragrances
Table4C3:ManufacturersSalesofFragrancesintheUnitedStatesbyTradeClass,2012
$Million
Tradeclass
Womens
Luxury
1,582
769
2,351
61.6
Specialty
739
73
812
21.3
Mass
198
170
368
9.6
Direct
198
89
287
7.5
2,717
1,101
3,818
100.0
Total
Mens
Total
%Oftotal
RETAILSALES
Retailsalesoffragrancesareestimatedat$6,093million,upfrom$5,859millionin2011.
COMPETITION
Eachoftheninelargestcompaniesgeneratesmorethan$100millioninfragrancesalesand
togetheraccountformorethanthreequartersoftotaldollarvolumein2012.
Table4C4:ManufacturersSalesofFragrancesintheUnitedStatesbyCategoryandCompany,2012
$Million
Company
Womens
Total
%Oftotal
LimitedBrands
639
13
652
17.1
Coty
345
196
541
14.2
LOral
181
216
397
10.4
Procter&Gamble
134
175
309
8.1
EsteLauder
238
24
262
6.9
Chanel
181
63
244
6.4
ElizabethArden
188
27
215
5.6
Avon
146
56
202
5.3
LVMH
96
17
113
3.0
569
314
883
23.1
2,717
1,101
3,818
100.0
Allother
Total
Mens
4C3
4C4
Fragrances
LimitedBrandsremainsinfirstplaceandgainsshareasthelargestmarketeroffragrances,
increasingtoa17.1%sharein2012,upfroma16.8%shareofthetotalfragrancesmarketin
2011.
The company is the leading marketer of womens fragrances, competing with brands
from Bath& Body Works, Victorias Secret, and Pink. Sales of its mens fragrances
remainlow.
Sales grow due to the regular launch of new and different scents coupled with
promotionalpricingandappealingmarketing.
Cotyremainsinsecondplacewithashareof14.2%in2012,upfrom13.9%in2011.
Thecompanyrankssecondinsalesinbothmensandwomensfragrances.
During2012,LOralcontinuestoberankedthirdwitha10.4%share,unchangedfromthe
prioryear.
In 2012,thecompanyranksfirstinthesales ofmensfragrancesandtiedforfifthin
womensfragrances.
Procter&Gambleremainsinfourthpositionwithsalesof$309millionandan8.1%share.
The company ranks third in the sales of mens fragrances and eighth in womens
fragrances.
EsteLauderremainsinfifthplacewithtotalsalesof$262million,downfrom$273million
in2011.
Itssharedropsto6.9%in2012,from7.4%in2011.
The company ranks third in the sales of womens fragrances and seventh in mens
fragrances.
RETAILDISTRIBUTION
Department stores maintain their position as the leading retail outlet for the sales of
fragrancesin2012.
4A4
Fragrances
Table4C5:RetailDistributionofFragrancesintheUnitedStates,2012
Retailoutlet
%Ofmanufacturersdollars
Womens
Mens
Weightedaverage
Departmentstores
34
37
35
Specialtystores
35
16
30
Massmerchandisers
12
19
14
Directsales
12
16
13
Drugstores
11
Foodstores
100
100
100
Total
OUTLOOK
Sales for the total fragrances industryexperience growth for the third year in a row after
severalyearsofsoftsales.
The industry is still largely dependent on holiday sales and foreign tourists, both of
whicharenotenoughtosubstantiallygrowthecategory.
Whilenewproductshelpcreatesomeexcitementintheindustry,mostofthegrowth
comesfromestablishedscentsandfranchises.
Thefragrancesindustryfacesmanychallengeswhichstiflerobustgrowth.
A reduced demand for fragrances as gifts due to competition from other products
rangingfromconsumerelectronicstogiftcards.
Concern about the healthfulness of fragrances regarding asthma, allergies, and the
potentialtobeahormonedisrupter.
Lackofcompatibilitywiththegrowingtrendofnaturalpersonalcareproducts.
The prohibition of fragrances in work environments mandated by companies or
requestedbycoworkers.
Amorecausalworkenvironmentwithlessdressupopportunities.
The fragrances industry needs to take steps to become more pertinent with consumers
duringtheforecastperiod.
The industry needs to work towards more natural scents that are wellsuited to a
naturallifestyle,containinglesssyntheticingredientsandthatarelesslikelytointeract
withthebodysendocrineandhormonalfunctioning.
Researchers should look to develop scents that offer beneficial properties to
consumerssuchasloweringbloodpressure,elevatingmood,orprovidingmoreenergy.
To help lessen confusion on the part of the consumer, there needs to be more
distinctionbetweenscents.
4C5
4C6
Fragrances
Classicsanddesignerscentswillremainpopularthroughtheforecastperiod.
Celebrityscentswillserveasalaunchpadtogetyoungerconsumersinterestedinthe
category.
Marketersneedtoreassesstheirproductofferingstobesuretheyaretrulydifferent,
insteadofjustservingtoconfusetheconsumer.
Marketers need to further review their distribution strategies, as the offering of
prestigescentsinmasschannels,continuestohurtbrandequity,asithasfornearlya
decade.
Marketers need to better engage consumers to help cement a better relationship with
purchasers.
The marketing methods utilized during the forecast period need to be carefully
examinedonthebasisofbrand.
Marketersneedtotellmorestoriesaboutthereasonforthescentandwhatitstands
for.
Samplingisbecomingmorevitalthanever.
Workingwithretailerstodevelopspecialeventscanhelpencouragetrialofproducts.
Promotionalendeavorsshouldtakeplacethroughouttheyearandnotjustaroundgift
givingtime.
Engaging consumers through social media will become an important medium,
especiallyasreadershipofmagazinesdeclines.
SalesoffragrancesareprojectedtoincreaseataCAGRof3.2%,reaching$4,475millionby
2017from$3,818millionin2012.
Table4C6:ForecastManufacturersSalesofFragrancesintheUnitedStatesby
$Million
Category
2012
2017
CAGR,%
Fragrancesforwomen
2,717
3,231
3.5
Fragrancesformen
1,101
1,244
2.5
Total
3,818
4,475
3.2
Unitvolumeisexpectedtoincreaseduetotheavailabilityofsmallersizedproducts.
Packagesareexpectedtoreach281millionin2017.
4A6
Fragrances
Table4C7:ForecastUnitVolumeofFragrancesintheUnitedStatesbyCategory,
2012and2017
Millionpackages
Category
2012
2017
CAGR,%
Fragrancesforwomen
160
177
2.0
Fragrancesformen
100
104
0.8
Total
260
281
1.6
4C7
4C8
Fragrances
4A8
FRAGRANCESFORMEN
CATEGORYPERFORMANCE
Manufacturerssales
Thefragrancesformencategorycontinuestoexhibitlowgrowthin2012.
Salesgrow3.6%duringtheyear,from$1,063millionin2011to$1,101millionin2012.
Sales of fragrances for men have declined at a compound annual growth rate (CAGR) of
1.4%from$1,180millionin2007to$1,101millionin2012.
Table4C8:HistoricalSalesofFragrancesforMenin
Year
$Million
Change,%
2007
1,180
2008
1,108
(6.5)
2009
1,010
(8.8)
2010
1,024
1.4
2011
1,063
3.8
2012
1,101
3.6
Unitsales
Unitsalesoffragrancesformenincrease1.5%to99.9millionfrom99.4millionin2011.
Retailsales
Sales of fragrances for men at the retail level total $1,731million for 2012, up 3.7% from
4C10
FragrancesforMen
Table4C9:Manufacturers'SalesofFragrancesforMenintheUnitedStatesbyBrand,2011and2012
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
LUXURY
AcquadiGi
L'Oral
50
53
6.9
6.9
4.7
4.8
Bleu
Chanel
42
45
5.8
5.9
4.0
4.1
GucciGuiltyPourHomme
Procter&Gamble
40
42
5.5
5.5
3.8
3.8
ArmaniCode
L'Oral
24
24
3.3
3.1
2.3
2.2
LightBluePourHomme
Procter&Gamble
23
22
3.2
2.9
2.2
2.0
PoloBleu
L'Oral
21
21
2.9
2.7
2.0
1.9
TheOneForMen
Procter&Gamble
23
21
3.2
2.7
2.2
1.9
Polo
L'Oral
14
15
1.9
2.0
1.3
1.4
L'HommeYvesSaint
Laurent
L'Oral
13
14
1.8
1.8
1.2
1.3
PoloBlack
L'Oral
13
13
1.8
1.7
1.2
1.2
EternityForMen
Coty
13
13
1.8
1.7
1.2
1.2
LeMale
Shiseido
13
13
1.8
1.7
1.2
1.2
ObsessionforMen
Coty
12
12
1.7
1.6
1.1
1.1
EuphoriaMen
Coty
11
12
1.5
1.6
1.0
1.1
Legend
InterParfums
12
1.6
1.1
CoolWater
Coty
11
11
1.5
1.4
1.0
1.0
TheOneSport
Procter&Gamble
11
1.4
1.0
GucciByGucci
Procter&Gamble
13
10
1.8
1.3
1.2
0.9
EternityAqua
Coty
10
1.2
1.3
0.8
0.9
Chrome
Clarins
10
1.2
1.3
0.8
0.9
DrakkarNoir
L'Oral
1.1
1.2
0.8
0.8
VersacePourHomme
EuroItaly
1.1
1.2
0.8
0.8
1Million
Coty
1.2
0.8
LaNuitdeL'Homme
L'Oral
1.2
1.0
0.8
0.7
Aramis
EsteLauder
1.1
1.0
0.8
0.7
VersaceManEauFraiche
EuroItaly
1.0
1.0
0.7
0.7
L'HommeLibre
L'Oral
0.7
1.0
0.5
0.7
L'Eaud'IsseyPour
Homme
Shiseido
1.0
0.9
0.7
0.6
EauLacosteBlanc
Procter&Gamble
0.6
0.9
0.4
0.6
BigPony1
L'Oral
1.0
0.8
0.7
0.5
Dolce&Gabbana
Procter&Gamble
0.8
0.7
0.6
0.5
BigPony3
L'Oral
0.8
0.7
0.6
0.5
PoloDoubleBlack
L'Oral
0.7
0.7
0.5
0.5
(Continued)
4A10
4C11
FragrancesforMen
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
LUXURY(Continued)
BurberryTouchforMen
InterParfums
0.7
0.7
0.5
0.5
BurberryBritforMen
InterParfums
0.7
0.7
0.5
0.5
TerreD'Hermes
Hermes
0.6
0.7
0.4
0.5
CurveForMen
ElizabethArden
0.8
0.5
0.6
0.4
Coach
EsteLauder
0.8
0.5
0.6
0.4
NauticaVoyage
Coty
0.7
0.5
0.5
0.4
ArmaniCodeSport
L'Oral
0.7
0.5
0.5
0.4
BigPony4
L'Oral
0.7
0.5
0.5
0.4
BigPony2
L'Oral
0.7
0.5
0.5
0.4
LacosteEssential
Procter&Gamble
0.7
0.5
0.5
0.4
PradaMan
Coty
0.6
0.5
0.4
0.4
EuphoriaMenIntense
Coty
0.6
0.5
0.4
0.4
PlatinumEgoiste
Chanel
0.4
0.5
0.3
0.4
VinceCamuto
Procter&Gamble
0.5
0.4
Spicebomb
L'Oral
0.5
0.4
IsseyPourHommeSport
Shiseido
0.5
0.4
ConnectedKennethCole
Reaction
Coty
0.6
0.4
0.4
0.3
GuessSeductiveHomme
Coty
0.6
0.4
0.4
0.3
TheOneGentleman
Procter&Gamble
0.6
0.4
0.4
0.3
EdHardyLove&Luck
ElizabethArden
0.6
0.4
0.4
0.3
KennethColeReaction
Coty
0.6
0.4
0.4
0.3
Pi
LVMH
0.4
0.4
0.3
0.3
AllureHommeSport
Chanel
0.4
0.4
0.3
0.3
Fahrenheit
LVMH
0.4
0.4
0.3
0.3
PleasuresforMen
EsteLauder
0.4
0.4
0.3
0.3
LacosteEssentialSport
Procter&Gamble
0.4
0.4
0.3
0.3
AllureHomme
Chanel
0.4
0.4
0.3
0.3
Artisian
Shiseido
0.4
0.4
0.3
0.3
BvlgariMan
Chanel
0.4
0.4
0.3
0.3
EckoBlue
ParluxFragrances
0.4
0.4
0.3
0.3
PradeAmberPour
Homme
Coty
0.3
0.4
0.2
0.3
Encounter
Coty
0.4
0.3
AllureHommeExtreme
Chanel
0.4
0.3
(Continued)
4C12
FragrancesforMen
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
LUXURY(Continued)
P.S.
ElizabethArden
0.4
0.3
0.3
0.2
CKFree
Coty
0.4
0.3
0.3
0.2
Play
LVMH
0.4
0.3
0.3
0.2
KennethColeNewYork
Black
Coty
0.4
0.3
0.3
0.2
TrueReligion
ElizabethArden
0.4
0.3
0.3
0.2
PoloSport
L'Oral
0.3
0.3
0.2
0.2
0.3
0.3
0.2
0.2
Coty
212CarolinaHerrera
Coty
0.3
0.3
0.2
0.2
GucciPourHommeII
Procter&Gamble
0.3
0.3
0.2
0.2
JohnVarvatos
ElizabethArden
0.3
0.3
0.2
0.2
HappyforMen
EsteLauder
0.3
0.3
0.2
0.2
TomFordForMen
EsteLauder
0.3
0.3
0.2
0.2
Joop!
Coty
0.3
0.3
0.2
0.2
JohnVarvatosStar
ElizabethArden
0.3
0.3
0.2
0.2
AngelMen
Clarins
0.1
0.3
0.1
0.2
EdHardyVillian
ElizabethArden
0.3
0.2
TomFordNoir
EsteLauder
0.3
0.2
OnlytheBrave
L'Oral
0.4
0.1
0.3
0.1
DieselFuelForLifeFor
Him
L'Oral
0.3
0.1
0.2
0.1
UsherHe
ElizabethArden
0.3
0.1
0.2
0.1
EdHardyHearts&
Daggers
ElizabethArden
Fragrances
0.3
0.1
0.2
0.1
PoloExplorer
L'Oral
0.3
0.1
0.2
0.1
Tommy
EsteLauder
0.3
0.1
0.2
0.1
KennethColeRSVP
Coty
0.3
0.1
0.2
0.1
DrifterforMen
ElizabethArden
0.3
0.1
0.2
0.1
HanaeMoriforMen
InternationalCosmetics
&Perfumes
0.3
0.1
0.2
0.1
TheBeat
InterParfums
0.1
0.1
0.1
0.1
EdHardyMen
ElizabethArden
0.1
0.1
0.1
0.1
TommyBahama
GeminiCosmetics
0.1
0.1
0.1
0.1
Bang
Coty
0.1
0.1
0.1
0.1
NauticaOcean
Coty
0.1
0.1
0.1
0.1
CurveCrush
ElizabethArden
0.1
0.1
0.1
0.1
(Continued)
4A12
4C13
FragrancesforMen
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
LUXURY(Continued)
MarcJacobsMen
Coty
0.1
0.1
0.1
0.1
DirtyEnglish
ElizabethArden
0.1
0.1
0.1
0.1
VeraWangMen
Coty
0.1
0.1
0.1
0.1
IzodForMen
GeminiCosmetics
0.1
0.1
0.1
0.1
Allother
L'Oral
14
14
1.9
1.8
1.3
1.3
Allother
Coty
10
1.4
1.2
0.9
0.8
Allother
LVMH
1.2
1.2
0.8
0.8
Allother
Procter&Gamble
0.8
0.8
0.6
0.5
Allother
ElizabethArden
0.4
0.3
0.3
0.2
Allother
EsteLauder
0.7
0.3
0.5
0.2
Allother
Chanel
0.3
0.3
0.2
0.2
Allother
Clarins
0.1
0.3
0.1
0.2
Allother
InterParfums
0.3
0.2
Allother
65
74
9.0
9.6
6.1
6.7
725
769
100.0
100.0
68.2
69.8
Total
MASS
OldSpice
Procter&Gamble
25
25
14.1
14.7
2.4
2.3
Stetson
Coty
17
17
9.6
10.0
1.6
1.5
Adidas
Coty
15
16
8.5
9.4
1.4
1.5
McGraw
Coty
13
12
7.3
7.1
1.2
1.1
GilletteSeries
Procter&Gamble
10
10
5.6
5.9
0.9
0.9
Bod
YellowWoodPartners
10
5.1
5.9
0.8
0.9
JovanMuskForMen
Coty
5.1
4.7
0.8
0.7
Brut
HelenofTroy
PlayboyForHim
Coty
SkinBracer
4.5
4.7
0.8
0.7
11
6.2
4.1
1.0
0.6
ColgatePalmolive
2.3
2.4
0.4
0.4
AquaVelva
Combe
2.3
2.4
0.4
0.4
DavidBeckham
Coty
2.8
2.4
0.5
0.4
NiveaforMen
Beiersdorf
1.7
1.8
0.3
0.3
AntonioBanderas
Coty
1.7
1.8
0.3
0.3
PreferredStock
Coty
1.7
1.2
0.3
0.2
HalstonMen'sFragrance
ElizabethArden
1.1
1.2
0.2
0.2
EnglishLeather
DanaClassicFragrances
1.1
1.2
0.2
0.2
Afta
ColgatePalmolive
1.1
1.2
0.2
0.2
PierreCardin
FiveStarFragrances
0.6
0.6
0.1
0.1
(Continued)
4C14
FragrancesforMen
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
MASS(Continued)
Canoe
0.6
0.6
0.1
0.1
BritishSterling
0.6
0.6
0.1
0.1
Gravity
Coty
0.6
0.6
0.1
0.1
MuskForMen
Coty
0.6
0.6
0.1
0.1
1.7
1.8
0.3
0.3
3.4
4.1
0.6
0.6
18
16
10.2
9.4
1.7
1.5
177
170
100.0
100.0
16.7
15.4
Privatelabel
Allother
Coty
Allother
Total
DIRECT
UnpluggedforMen
Avon
10
11.2
0.9
VelocityforHim
MaryKay
9.8
10.1
0.8
0.8
MesmerizeforMen
Avon
8.7
9.0
0.8
0.7
BlackSuede
Avon
6.5
6.7
0.6
0.5
MKHighIntensity
MaryKay
6.5
6.7
0.6
0.5
Domain
MaryKay
6.5
6.7
0.6
0.5
DerekJeterDrivenBlack
Avon
6.5
5.6
0.6
0.5
MuskMarine
Avon
4.5
0.4
MuskFire
Avon
4.5
0.4
WildCountry
Avon
4.3
4.5
0.4
0.4
Ironman
Avon
4.3
4.5
0.4
0.4
DerekJeterDriven
Avon
2.2
2.2
0.2
0.2
PatrickDemsey2
Avon
4.3
1.1
0.4
0.1
PatrickDemsey
Unscripted
Avon
4.3
1.1
0.4
0.1
ChristianLacroixNoir
Avon
3.3
1.1
0.3
0.1
Turn4XT
Avon
3.3
1.1
0.3
0.1
Tribute
MaryKay
1.1
1.1
0.1
0.1
HerveLegerHomme
Avon
2.2
0.2
DerekJeterDrivenSport
Avon
2.2
0.2
DerekJeterDrivenFresh
Avon
2.2
0.2
DerekJeterDrivenWarm
Avon
2.2
0.2
Allother
Avon
6.5
5.6
0.6
0.5
12
11
13.0
12.4
1.1
1.0
92
89
100.0
100.0
8.7
8.1
Allother
Total
(Continued)
4A14
4C15
FragrancesforMen
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
27
29
39.1
39.7
2.5
2.6
SPECIALTY
Abercrombie&Fitch
Abercrombie&Fitch
Honor
Express
11.6
12.3
0.8
0.8
VerySexyforHim
LimitedBrands
11.6
9.6
0.8
0.6
BananaRepublic
TheGap
8.7
9.6
0.6
0.6
Bath&BodyWorks
LimitedBrands
8.7
8.2
0.6
0.5
AmericanEagle
AmericanEagle
4.3
4.1
0.3
0.3
11
12
15.9
16.4
1.0
1.1
Total
69
73
100.0
100.0
6.5
6.6
TOTAL
1,063
1,101
100.0
100.0
Allother
CATEGORYDEVELOPMENT
Markettrends
Thefragrancesformencategorystrugglesmostin2012,affectedbyeconomicuncertainty,
SuperstormSandy,andthesenselessmassshootingofinnocentAmericans.
Thesuccessofthefragrancescategoryistiedverycloselytotheholidaysellingseason,
andsincetheaboveeventsoccurredinthelastquarter,thisgreatlyhamperssales,up
untilafewdaysbeforeChristmas.
Withoutrobustgrowth,thecategorydoesnotappeartoberebounding,butratherjust
slowlymovingbacktolevelsseenbeforetherecession.
The luxury trade class displayed the highest growth, up 6.1%, followed by specialty
tradeclassadvancingat5.8%.
Althoughsalesoffragrancesformenhavegrownyearlysince2010,itdoesnotindicatethat
Americanmenarewearingmorefragrances.
Muchofthefragrancepurchasedisbyinternationaltouristswholikescentsandwho
frequent the U.S. shopping venues looking for clothes and fragrances that are more
attractivelypricedthanintheirhomecountries.
Withthetrendtowardstelecommutingandmorecasualworkenvironments,menare
notdressinguponadailybasisastheydidseveraldecadesago.
Concernaboutworkmateswhoaresensitivetofragrance,alongwiththecontroversy
aboutthepotentialoffragrancesashormoneandendocrinedisrupters,contributeto
hamperingrealsalesgrowth.
Fragrancedoesnotappeartobeadailyusegroomingproductnecessityamongmost
men,butratherreservedforspecialoccasions.
4C16
FragrancesforMen
Category growth continues to be driven by firmlyentrenched brands, such as LOrals

Acqua di Gi and Chanels Bleu continuing to thrive, and by the expansion of reputable
franchises,suchasProcter&GamblesGucciandDolce&Gabbana.
Asseenoverthepastfewyears,classicsandbrandsfromestablishedmarketersexhibit
themostvitality.
Edgybrandsandthosewithacelebrityalignmentmightbepopularoneyearandfall
out of the fashion the next. Therefore, most fragrance marketers are careful and
developallianceswithmainstreamaccessoryorfashionbrands.
Newlauncheshelpgrowthefragrancesformencategory.
InterParfums Montblanc Legend was the bestperforming mens fragrance launch of
2012,andisgearedtoyoungmen.ThescentisreminiscentofAbercrombiesFierceto
somefragranceexperts.
Procter & Gambles Dolce & Gabbana The One franchise was extended with a third
fragranceTheOneSport,whichisalighterandfresherversionoftheoriginal.
SpicebombisthemaleequivalentofViktor&RolfsFlowerbombfragrancefromLOral,
andthedistinctivepackaginglookslikeahandgrenade.
Nichescentsalsohelptogrowthefragrancesformencategory.
Scentsfrommarketers,suchasAcquaduParma,CliveChristian,ByKilian,Houbigant,
Bond No. 9, and Amouage create excitement in the industry and offer a point of
differentiation.
These scents have price points as high as several hundred dollars, based on their
ingredientcompositionandlongevity.
Theallureofthesenichescentsisthatfewpeoplewearthesescents,duetotheirhigh
priceandlimiteddistribution,andthereforeofferadistinctiveopportunityforamanto
smelldifferentlyfromhiscolleagues.
While collectively these scents are estimated at 5% to 8% of the total fragrances for
menmarketintheluxurytradeclass,eachofthesescentsindividuallyhassmallsales
andarenottrackedindividuallyinthisreport.
Nichescentsaretypicallynotlargeenoughinvolumeforthelargecompaniestooffer,
especially with their select distribution to very high end boutiques and department
stores,suchasNeimanMarcus,BergdorfGoodman,andBarneys.
Flankers,lineextensions,andmigrationofscentstosecondarychannelscontributetothe
declineinthebrandsequity.
Marketers continue to add flankers and line extensions to offer newness to the
consumer, but when new introductions are made, the main brand typically exhibits
decliningsales.During2012,Procter&GamblesTheOneForMendeclinesnearly9%
withthelaunchofTheOneSport.
Theindustryalsoutilizesapracticewherebyaluxuryscentisofferedforsaleinmass
channels,dilutingthebrandsequity.Thismaybeintentionallydonebymarketersto
helpgrowsales,ormaybetheresultofdivertedgoods.
Thesepracticesmakethebrandspositioningmurkyanderodethebrandsequity.
4A16
FragrancesforMen
Eventhoughthefragrancesformencategoryhasgrownyearlysince2010,severalfactors
continuetostiflesubstantialgrowth.
Many workplaces frown upon the use of fragrance due to headache and allergic
reactions.
Youngermencontinuetousescentedgroomingproductsinlieuoffragrance.
More telecommuting and casual work environments lower the opportunities to wear
fragrance.
Concernabouttheeffectsoffragranceproductsonhormonesandendocrinefunction
leadssomementoabandondailyuseoftheseproducts.
Confusionamongconsumersaboutthevariousbrandsandlineextensions,leadsmany
to either purchase only the more wellknown brands, or even abandon the category
entirely.
Frustration on the part of consumers due to the lack of differentiation among scents
alsoleadstolessofapriorityonpurchasing.
A movement to ban the wearing of fragrances in the workplace is gaining awareness in

someareasoftheUnitedStatesandbeyond,whichcouldnegativelyimpactthecategorys
futuresales.
InDecember2012,legislationintroducedinNewHampshirepreventsstateemployees
who have contact with members of the public from wearing fragrances during the
workday.
Private employers and other government agencies in the United States and Canada,
suchasthecityofDetroit,MI;Portland,OR,andtheU.S.CensusBureau,havebanned
thewearingoffragranceattheirworkplace.
In Europe, there is a movement to ban fragrances that include certain ingredients
includingthetopsellingChanelNo.5,whichissaidtoincludeatreemossextractthat
cansetoffallergicreactions.
Most personal care products are required to display their ingredient composition on
thepackage,withonlyafewexceptions.Fragranceformulationsareconsideredtrade
secretsandareexemptfromtheingredientrequirementdisclosure,butthereisapush
by various advocacy groups to make it mandatory to have their ingredients made
public.
Giftsoffragrancesarenotheldinthesameesteemasdecadesago.
Menareoptingforelectronics,suchastablets,games,andgadgets,pushingfragrances
tothebackseatasoneofthemostwantedgifts.
Withanemphasisonvalue,giftshopperscanpurchaseseveralitemsonsales,whereas
fragrancesaretypicallysoldatfullprice.
4C17
4C18
FragrancesforMen
M&Aactivity
A number of new licensing agreements and corporate developments are signed or take
effectduring2012,withmoreannouncedfor2013.
AlfredDunhillannouncesthatitisswitchinglicensingpartnerseffectiveApril2013to
InterParfumsina10yeardealfromProcter&Gamble.
InterParfumsacquiresthefragrancelicenseofKarlLagerfieldinearly2012fromCoty.
InterParfumslosesthefragrancelicenseofBurberryasBurberrytakesownershipofits
ownfragrancelicenseasof2013.
Kenneth Cole signs a licensing deal with Parlux effective January 2013 after 10 years
withCoty.
Coty, which has distributed Puigs fragrances in North America for the past six years,
willceasedoingsowhenthelicenseexpiresonJune30,2013.
Clarins Fragrance Group will begin to distribute Puigs fragrances in North America
effectiveJuly1,2013.
ElizabethArdenacquirestheglobalfragrancelicensesofEdHardy,TrueReligion,and
BCBGMaxAzriafromNewWaveFragrancesinmid2012.ElizabethArdenalsoacquires
thefragrancelicensesofJustinBieberandNickiMinajfromGiveBackBrandsLLC.
Yellow Wood Partners acquires Parums de Coeur, Ltd a privatelyheld firm for an
undisclosedamountinfall2012.
Notablenewproducts
Table4C10:SelectNewFragrancesforMenIntroducedintheUnitedStatesin2012
Company
Brand
Avon
JonBonJovi
Chanel
Chanel
Coty
CalvinKlein
Coty
PacoRabanne
ElizabethArden
EdHardy
EsteLauder
TomFord
Interparfums
Montblanc
LOral
Viktor&Rolf
Procter&Gamble
Dolce&
Gabbana
Procter&Gamble
VinceCamuto
Shiseido
IsseyMiyake
Description
UnpluggedforMen,acollaborationbetweenAvonandJonBonJovi,awoody,floral,and
muskyscent
AllureHommeExtreme,thenewestextensionintheAllureline,includesmuskyshades,
tartspices,aromaticfreshness,andwoodyaccords
Encounter,thenewestCalvinKleinscent,openswithmandarin,cardamom,andrum,
alongwithpepper,jasmine,patchouli,andcognac.
OneMillionintroducedintheUnitedStatesincludesnotesofgrapefruit,redorange,
mint,rose,cinnamon,spices,leather,wood,patchouli,andamber
VillianopenswithnotesofItalianBergamotandFrenchlavenderalongwithmasculine
spicesandEgyptianbasilandwildsage
TomFordNoirhastopnotesofbergamot,verbena,caraway,pinkpepper,andviolet
ThefirstmalescentfromMontblancwithcontrastingnotesthatevokestrengthand
tenderness,traditionandmodernity.Thefougrescentstopnotesincludelavender,
bergamot,coumarin,verbena,andpineappleleaves
Spicebomblookslikeahandgrenadeandcontainsnotesofchili,saffron,leather,
tobacco,andvetiver,alongwithbergamot,grapefruit,elemi,andpepper
TheOnefranchiseisextendedwithTheOneSport,thethirdfragranceintheline.Thisis
lighterandfresherthantheotherscentsinthefranchiseandopenswithaquaticnotes
androsemaryalongwithcardamomandsequoiawood.
Inablackbottlewiththefamilycrest,thisfragranceopenswithItalianbergamot,
mandarin,andblackpepper
IsseyPourHommeSport,sporteditionofhisnamesakefragranceopenswithseveral
citrusnotes
4A18
FragrancesforMen
CATEGORYSEGMENTATION
Salesbyproducttype
Liquidproductsaccountfor91.0%ofthetotalmensfragrancesalesin2012,downslightly
from91.1%in2011.
Table4C11:ManufacturersSalesofFragrancesforMenintheUnitedStatesbyProductType,
2011and2012
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Liquidproductsa
968
1,002
91.1
91.0
Ancillaryproducts
95
99
8.9
9.0
Total
1,063
1,101
100.0
100.0
aIncludescologne,eaudeparfum,eaudetoilette,andaftershave.
Change,%
3.5
4.2
3.6
COMPETITION
Bycompany
Table4C12:ManufacturersSalesofFragrancesforMenintheUnitedStatesbyCompany,2011and2012
$Million
%Oftotal
Company
2011
2012
2011
2012
LOral
214
216
20.1
19.6
Coty
195
196
18.3
17.8
Procter&Gamble
164
175
15.4
15.9
Chanel
56
63
5.3
5.7
Avon
58
56
5.5
5.1
Abercrombie&Fitch
27
29
2.5
2.6
Shiseido
23
27
2.2
2.5
ElizabethArdena
34
27
3.2
2.5
EsteLauder
29
24
2.7
2.2
InterParfums
13
23
1.2
2.1
MaryKay
22
22
2.1
2.0
LVMH
18
17
1.7
1.5
EuroItaly
15
17
1.4
1.5
Clarins
11
14
1.0
1.3
LimitedBrands
14
13
1.3
1.2
Allother
170
182
16.0
16.5
Total
1,063
1,101
100.0
100.0
aElizabethArdenpurchasesthefragrancebrandsofNewWaveduring2012.
Change,%
0.9
0.5
6.7
12.5
(3.4)
7.4
17.4
(20.6)
(17.2)
76.9
(5.6)
13.3
27.3
(7.1)
7.1
3.6
4C19
4C20
FragrancesforMen
The top three companiesLOral, Coty, and Procter & Gambletogether account for
53.3%oftotalcategorysales,downslightlyfrom53.8%in2011.
LOralmaintainsthetopspotastheleadingmarketeroffragrancesformenwitha19.6%
share.
Salesgrow0.9%or$2millionto$216millionbasedonthestrengthoffragrances,such
asAcquadiGi,ArmaniCode,andthePolofranchise.
Sixofthetop10scentsbelongtoLOral.
The companys Acqua di Gi continues to be the leader among male fragrances with
$53millioninsales,$8millionaheadofsecondplacedChanelsBleu.
ArmaniCoderanksfourth,andPoloBlueremainsinsixthposition.
LOralcontinuestorelyonitsassociationwithclassicdesignersforitsscentsincluding
Giorgio Armani, Ralph Lauren, Yves Saint Laurent, and Viktor and Rolf, and growth is
experiencedduring2012becausemostoftheclassicsperformwell.
Theluxurytradeclassistheonlytradeclassinwhichthecompanycompetes.However,
whensomeofitsproductsdoendupinmassretailers,itistypicallyduetodiversion
ratherthananintentionaleffortbythecompany.
ThemajorlaunchoftheyearistheViktorandRolfsSpicebomb,withsalesof$4million
during2012.
Cotyremainsinsecondplace,withsalesadvancing$1millionor0.5%during2012.
Share drops from 18.3% to 17.8%, while sales increase from $195 million to
$196million.
Cotys biggest decline is from sluggishness in Kenneth Cole scents, a franchise which
Cotylosesasoflate2012.
ManyofCotysmajorscentshaveeitherrelativelyflatorslightlyupwardsales,suchas
EternityforMen0.0%,Euphora9.1%,andEternityAqua11.1%
Encounteristhemajorlaunchoftheyearwithsalesreaching$3million.
Unlikemanyothermarketersthatcompeteineithertheluxuryorthemasstradeclass,
Cotyisactiveinboth.
ManyofCotysmassscentsexperienceflatordecliningsales,suchasStetson,McGraw,
andPlayboy.
Since2006,inadditiontoitsownbrands,CotydistributesanumberofPuigsbrandsin
North America, including Prada, Nina Ricci, Carolina Herrera, Antonio Banderas, and
Paco Rabanne, which are reflected in Cotys total sales. However, Coty will cease to
distributethePuigfragranceswhenthelicenseexpiresonJune30,2013.
4A20
FragrancesforMen
Rounding out the top three marketers is Procter& Gamble with sales increasing 6.7%,
whichisagreatergrowthratethanLOralorCoty.
Salesgrowfrom$164millionin2011to$175millionin2012.
Procter & Gamble owes its fragrance success to its two highend European fashion
house licenses Dolce & Gabbana and Gucci in contrast to both LOral and Coty
thatalignwithmidtierfashionbrandsandcelebrities.
GucciGuiltyPourHommeisthethirdleadingmensfragrance,andcontinuestogrow,
up5%to$42million.
Dolce&GabbanastopscentsLightBluePourHommeisinfifthplace,whileTheOne
dropstoseventhplace,duetothelaunchofTheOneSportwhichobtains$11millionin
salesinjustafewmonths.
In2012,Procter&GamblelaunchesitsfirstscentwithdesignerVinceCamuto.
The company also competes in the mass market with its lower end, but long
established Old Spice, the leading mass brand, and the Gillette Series, both of which
are more aligned to shaving than fine fragrances, and both of which have a loyal
customerbase.
In a distant fourth place and nudging Avon out of this spot is Chanel, with sales growing
12.5%during2012.
Sales reach $63 million; however, sales are more than $100 million behind the third
rankedmarketer.
ChanelssalesincreasebasedonthesuccessofBleu,whichcontinuestogrow.
Bybrand
LOrals Acqua di Gi continues to lead the categorys sales and grows faster than the
industryaverage.
Salesreach$53millionin2012,agrowthof6.0%from$50millionintheprioryear.
Thebrandsshareoftheluxurytradeclassremainsflatat6.9%,whileshareofthetotal
mensfragrancemarketgrowsfrom4.7%to4.8%during2012.
ChanelsBleuisfirmlyentrenchedinsecondplaceinitssecondfullyearoncounter.
Salesare$45million,up7.1%from$42millionin2011.
Bleusshareoftheluxuryfragrancemarketgrowsslightlyfrom5.8%to5.9%whilethe
brandsshareofthetotalmensfragrancemarketgrowsfrom4.0%to4.1%.
Remaining in third place is Procter & Gambles Gucci Guilty Pour Homme, with sales
growing5.0%duringtheyear.
Salesreach$42million,upfrom$40millionduringitsfirstyearoncounter.
Thisscentmaintainsa5.5%shareoftheluxurymensmarket,anda3.8%shareofthe
totalfragrancemarket.
4C21
4C22
FragrancesforMen
Abercrombie&FitchsFierce,remainsinfourthplacewithsalesgrowingfrom$27millionin
2011to$29millionin2012.
Fierceistheleadingapparelretailerbrand.
Salesarestrongasthisscentispopularamongmaleteenagers(andthewomenthey
encounter).DuetothepopularityofthisscentamongtheAbercrombie&Fitchmale
customers,theretailerscentsthestorewithFierceandhasfansblowingthefragrance
outsidethestoretoenticeothercustomers.
Procter&GamblesOldSpiceisthemassleaderandranksfifthintotalcategoryssales.
Salesremainflatat$25million.
While this brand is more aligned with shaving than with fine fragrance, the viral
advertising and video campaigns for its body wash products help grow its fragrance
sales.
The brand accounts for 14.7% of the mens mass market for scents, up from 14.1%
during2011.
RETAILDISTRIBUTION
Department stores remain the favored channel for the purchase of fragrances for men at
37%,downslightlyfrom2011levels.
Specialtystoresanddirectsales,bothexperiencegainsofonesharepointduringthe
year.
Thedirectchannelincreasesduetoonlinesalesfrombothbrickandmortarretailers,
suchasspecialtyanddepartmentstores,andInternetonlyretailers.
Cosmetic specialty stores, including Ulta and Sephora, grow as a shopping venue for
fragranceduetotheirwideproductassortments,promotions,andloyaltyprograms.
Table4C13:ManufacturersSalesofFragrancesforMeninthe
UnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Departmentstores
38
37
Massmerchandisers
20
19
Directsales
15
16
Specialtystores
15
16
Drugstores
11
11
Foodstores
100
100
Total
4A22
FragrancesforMen
MARKETINGACTIVITY
Discountsandspecialpromotionsareofferedbymarketersandretailersinallclassesofthe
tradetohelppromotethefragrancesformencategory.
Consumerpromotionformensfragrancesincludespricerelatedprograms,sampling,
gifts,anddifferentinstoreactivities.
Sampling is particularly important for all trade classes and is becoming increasingly
importantasconsumerswanttotryaproductbeforetheybuyit.
Marketers also look at alternative promotional methods, including targeted event
sponsorships,samplingatdifferentvenues,andinteractivecampaignstohelpincrease
theexposureoftheirbrands.
Mostofthemajormarketersutilizesocialmediaandvideostopromotetheirscents.
Toreachyoungerandmoretechnologicallysavvyconsumers,brandsareusingtheInternet
andsocialmedia.
Brands reallocate their marketing budgets to include online advertising and viral
Internetcampaigns.
Blogger outreach is becoming a more important component of a brands marketing
effort with dissemination of product samples and literature to fashion and beauty
bloggers.
ManyfragrancebrandshaveFacebookpages,whereconsumerscanlikethebrandand
findoutthelatestnewproductsandpromotionalactivitiesofthebrand.
Giftwithpurchase (GWP) and purchasewithpurchase (PWP) offers are the domain of

luxurybrandsinthedepartmentstorechannelsandareprimepurchasedrivers.
Luxury marketers also employ sampling, giftsets with ancillary products which offer
great value as compared to purchasing these products individually, sample vials,
fragrancecards,andcatalogblowincardstostimulatesales.
Luxurybrandsalsoplacegreatemphasisandfocusoninstorepromotions.Marketers
oftenpartnerwithkeyretailersforadvertisingeffortsorinstoreevents.
In addition to GWP and PWP promotions, free samples are sometimes offered at a
luxurycounterinadepartmentstore,orwhenpurchasingonline.
Additionally,whenpurchasesaremadedirectlyorfromluxuryretailers,freeshipping
with beauty purchases over a certain amount is offered as a way to encourage
purchase.
4C23
4C24
FragrancesforMen
Sampling is increasing in popularity, with scented strips in magazines and store catalogs,
scented blotter cards distributed at retail stores, and fragrance vials attached to cards or
distributedinretailstores.
Sampling is very important for the purchase of luxury fragrance and is a marketing
methodutilizedbydepartmentstoresandbeautyspecialtystores.Moststoresinthese
channelscanmakesamplevialsuponrequestforconsumerstotry.
These retailers also sometimes have premade samples and scent strips which they
obtaindirectlyfromthemanufacturer.
Sephoratypicallyoffersasamplersetduringtheholidayseasonandcontinuestosellit
until stocks run out. As in the past, the sampler set works on the same premise of
buyingoneofthesets,tryingallthesamples,choosingthescentpreferred,andthen
redeeming the enclosed gift certificate for a free fullsize bottle of the preferred
fragrance.
Continuinginpopularity,availableyearround,andgearedtocostconsciousconsumers,are
valueandgiftsets.
Thesesetsareattractivetoconsumersbecauseofthehighlevelofvaluetheyoffer,as
thereisgreatsavingsinpurchasingtheseproductsasaset,whencomparedtobuying
eachoneontheirown.
AtMacys,athreepiecefitsetwithavalueof$139.50isavailablefor$78.00fromPolo
Bleuthatincludesaneaudetoilette,anaftershave,andadeodorant.
Valueandgiftsetscanalsoincludearelatedproductthatisnotfragrancerelatedto
target the audience. At Macys, a complimentary duffle bag is available with the
purchaseofanylargesprayfromtheGivenchymensfragrancecollection.
Specialty retailers increasingly utilize many of the same marketing methods to encourage
salesasdepartmentstores.
Marketingmethodsinthischannelincludepromotions,instoresamplinganddisplays,
directtoconsumermailings,email,andmorerecentlysocialmedia.
A tactic utilized by several specialty retailers is the placement of fragrance samplers
along with fragrances near the checkout counters to encourage pointofpurchase
impulsepurchases.
Ulta frequently runs promotions to encourage the purchase of fragrances whereby
consumersreceiveawiderangeofgiftsthatchangeperiodically,suchasanovernight
bag,withaminimumamountspentonafragrancepurchase.
Afragrancealongwitharangeofancillaryproductsinamaleorientedtoteorshaving
bag,issometimespromotedbyspecialtyretailers.
Forexample,atUlta,afreedufflebagisavailablewithanylargespraypurchasefrom
CalvinKlein.
CustomersatUltaalsoreceiveafreetoiletrybagwithaBurberryTouchforMentravel
spray and after shave balm with the purchase of any largesized Burberry mens
fragrance.
4A24
FragrancesforMen
Mass marketers utilize gift sets, coupons, and price discounts mostly promoted in their
weeklyflyerstohelpsellfragrancesformen.
Limitedsamplingisavailableinthischannel.
During theholidayselling season, mass merchandisers and drug chains typicallyoffer
promotionalpricingonthesaleofmensfragrances.
Direct marketers use their sales consultants and websites to promote new fragrances;
however,themarketingoffragrancesformenisnotthemainpriorityofmostdirectsales
companies.
Avon typically promotes new fragrances on the cover of its brochures at the time of
theirlaunch.
Scentstripsareoftenfeaturedincatalogs.
Otherpromotionalvehiclesincludemediaadvertising,discounts,andGWPoffers.
Intensemarketingeffortsincludingmediaadvertisements,sampling,anonlinecomponent,
social media, and other promotions including contests are typically used for both new
launchesandalsoclassicfragrances.
ForCalvinKleinsEncounterscent,actorAlexanderSkarsgardfromthetelevisionseries
True Blood along with model Lara Stone appear in print and broadcast advertising,
displayingthetensionanddesireinanencounterbetweenamanandwoman.
MontblancLegendisintroducedwithablackandwhiteadvertisingcampaignfeaturing
malemodelSimonClark.
Traceablemediaexpenditures(TMEs)formensfragrancesare$134.6millionin2012,down
from$204.9millionin2011.
LOral is the leader with TME at $63.5 million in 2012, down from $76.2million in
2011.
Procter&Gamblehasadvertisingexpendituresof$7.2million,downconsiderablyfrom
$33.4millionin2011.
CotyhasaTMEof$15.7million,downfrom$25.6millionin2011.
Fragrances for men are sometimes copromoted with their female versions, but this
jointadvertisingismostlycapturedinthewomenscategory.
DetailsonTMEareprovidedintheAdvertisingsectionofthisreport.
OUTLOOK
Slow growth is expected in the fragrances for mens category, as various challenges will
stymiesubstantialgrowth.
Despitegainsinthreeofthepastfiveyears,categorysalesarestillbelowprerecession
levelsandwillstruggletomoveforward,asfragrancesarenolongerthedailygrooming
necessityusedbymen.
Theuseoffragranceswillcontinuetobeoccasiondriven,ratherthanuseddaily.
4C25
4C26
FragrancesforMen
Substantialgrowthinthiscategoryisreliantonanumberofoutsidefactors.
Theriseintelecommutingallowsworkerstodressmorecasually.
Thelowerlevelofformalityintheworkplaceascomparedtopriorgenerations.
Policies,bothofficialandunofficial,restrictingtheusefragranceintheworkplace
The trend towards the use of natural products which runs contrary to what most
fragrancesonthemarketareformulatingwith.
Theuseofotherscentedproductsforfragrantpurposesincludingscentedbodysprays,
deodorants,bodymists,andairproducts.
Thecategorywillbedominatedbyclassics;howevernewentrantsareexpectedtosucceed
iftheyoffersomethingnewandexciting.
FirstyearsalesofMontblancLegendandTheOneSportpostgoodresults.
Offering a scent that is unique and different to its audience can help a brand thrive
alongwithacomprehensivemarketingprogramandadequatesampling.
Challengeswillcontinuetoplaguethefragrancesformencategoryoverthenextfiveyears.
Consumersneedtobecomemorefamiliarwiththestorybehindthebrandandmore
intimatewithwhatthebrandstandsfor.
Brands need to become innovative in their interactions with consumers to better
engagewiththem.
Sales of fragrances for men are projected to grow at a low CAGR of 2.5% to total
Table4C14:ForecastManufacturersSalesofFragrancesforMenby
ProductTypeintheUnitedStates,2012and2017
$Million
Producttype
2012
Liquidproducts
Ancillaryproducts
Total
2017
CAGR,%
1,002
1,134
2.5
99
110
2.1
1,101
1,244
2.5
Unit sales are projected to increase slightly from 99.9million packages in 2012 to
104.0millionpackagesin2017.
4A26
FRAGRANCESFORWOMEN
CATEGORYPERFORMANCE
Manufacturerssales
The fragrances for women category advances, up 4% in 2012, for the third year in a row,
afterexperiencingbigdeclinesinboth2008and2009.
Sales reach $2,717million, up 4.0% from $2,612million in 2011, and finally exceed
salesof2007.
Saleshaveincreasedatacompoundannualgrowthrate(CAGR)of0.1%since2007.
Table4C15:HistoricalSalesofFragrancesforWomen
intheUnitedStates,2007to2012
Year
$Million
Change,%
2007
2,706
2008
2,546
(5.9)
2009
2,379
(6.6)
2010
2,444
2.7
2011
2,612
6.9
2012
2,717
4.0
4C28
FragrancesforWomen
Table4C16:Manufacturers'SalesofFragrancesforWomenintheUnitedStatesbyBrand,2011and2012
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
2012
%Oftotal
2011
2012
LUXURY
CocoMademoiselle
Chanel
52
58
3.5
3.7
2.0
2.1
ChanelNo.5
Chanel
44
48
2.9
3.0
1.7
1.8
Dolce&GabbanaLightBlue
Procter&Gamble
44
43
2.9
2.7
1.7
1.6
Beautiful
EsteLauder
37
37
2.5
2.3
1.4
1.4
VivaLaJuicy
ElizabethArden
27
30
1.8
1.9
1.0
1.1
Angel
Clarins
25
27
1.7
1.7
1.0
1.0
Viktor&RolfFlowerbomb
L'Oral
22
27
1.5
1.7
0.8
1.0
CashmereMist
EsteLauder
25
26
1.7
1.6
1.0
1.0
J'adore
LVMH
22
26
1.5
1.6
0.8
1.0
Euphoria
Coty
24
23
1.6
1.5
0.9
0.8
Pleasures
EsteLauder
20
23
1.3
1.5
0.8
0.8
ChanceEauTendre
Chanel
18
20
1.2
1.3
0.7
0.7
Romance
L'Oral
20
20
1.3
1.3
0.8
0.7
Happy
EsteLauder
18
18
1.2
1.1
0.7
0.7
WhiteDiamonds
ElizabethArden
19
18
1.3
1.1
0.7
0.7
JimmyChoo
InterParfums
17
0.3
1.1
0.2
0.6
Chance
Chanel
15
16
1.0
1.0
0.6
0.6
DaisyEauSoFresh
Coty
15
15
1.0
0.9
0.6
0.6
GucciGuilty
Procter&Gamble
22
15
1.5
0.9
0.8
0.6
Philosophy
Coty
15
15
1.0
0.9
0.6
0.6
Trsor
L'Oral
17
15
1.1
0.9
0.7
0.6
AcquadiGioia
L'Oral
15
14
1.0
0.9
0.6
0.5
DaisyMarcJacobs
Coty
13
14
0.9
0.9
0.5
0.5
Dolce&GabbanaTheOne
Procter&Gamble
17
14
1.1
0.9
0.7
0.5
Girlfriend
ElizabethArden
14
0.9
0.5
LaVieEstBelle
L'Oral
14
0.9
0.5
MarcJacobsDot
Coty
14
0.9
0.5
CoachPoppy
EsteLauder
18
13
1.2
0.8
0.7
0.5
Eternity
Coty
13
13
0.9
0.8
0.5
0.5
Wonderstruck
ElizabethArden
24
13
1.6
0.8
0.9
0.5
BrightCrystal
EuroItaly
11
12
0.7
0.8
0.4
0.4
CKOne
Coty
11
12
0.7
0.8
0.4
0.4
PradaCandy
Coty
12
0.3
0.8
0.2
0.4
Shalimar
LVMH
12
12
0.8
0.8
0.5
0.4
AromaticsElixir
EsteLauder
11
11
0.7
0.7
0.4
0.4
ChanceEauFraiche
Chanel
10
11
0.7
0.7
0.4
0.4
Fame
Coty
11
0.7
0.4
Opium
L'Oral
12
11
0.8
0.7
0.5
0.4
(Continued)
4A28
4C29
FragrancesforWomen
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
2012
%Oftotal
2011
2012
LUXURY(Continued)
PinkFriday
ElizabethArden
SensuousNude
EsteLauder
11
0.7
0.4
10
11
0.7
0.7
0.4
0.4
TruthorDare
Coty
BurberryBody
InterParfums
11
0.7
0.4
10
10
0.7
0.6
0.4
0.4
Coco
Chanel
10
10
0.7
0.6
0.4
0.4
GucciPremiere
Procter&Gamble
RedDoor
ElizabethArden
10
0.6
0.4
11
10
0.7
0.6
0.4
0.4
Someday
ElizabethArden
35
10
2.3
0.6
1.3
0.4
BondNo.9Classics
Chloe
BondNo.9
0.5
0.6
0.3
0.3
Coty
0.5
0.6
0.3
0.3
MissDiorCherie
LVMH
0.6
0.6
0.3
0.3
WonderstruckEnchanted
ElizabethArden
0.6
0.3
YouthDew
EsteLauder
0.6
0.6
0.3
0.3
BurberryBrit
InterParfums
0.5
0.5
0.3
0.3
CocoNoir
Chanel
0.5
0.3
JuicyCouture
ElizabethArden
0.6
0.5
0.3
0.3
Obsession
Coty
0.5
0.5
0.3
0.3
VeryIrresistible
LVMH
0.5
0.5
0.3
0.3
Alien
Clarins
0.4
0.4
0.2
0.3
Allure
Chanel
0.5
0.4
0.3
0.3
ArmaniCodeforWomen
L'Oral
0.5
0.4
0.3
0.3
BeDelicious
EsteLauder
0.5
0.4
0.3
0.3
CoachPoppyFlower
EsteLauder
0.5
0.4
0.3
0.3
FanDiFendi
LVMH
0.4
0.4
0.2
0.3
JoMalone
EsteLauder
0.4
0.4
0.2
0.3
L'Eaud'Issey
Shiseido
0.5
0.4
0.3
0.3
Lovestruck
Coty
0.4
0.4
0.2
0.3
Miracle
L'Oral
0.5
0.4
0.3
0.3
Oh,Lola!MarcJacobs
Coty
0.5
0.4
0.3
0.3
Sensuous
EsteLauder
10
0.7
0.4
0.4
0.3
VeraWangPrincess
Coty
0.5
0.4
0.3
0.3
WhiteLinen
EsteLauder
0.5
0.4
0.3
0.3
CoachSignature
EsteLauder
0.5
0.4
0.3
0.2
FlorabyGucci
Procter&Gamble
0.5
0.4
0.3
0.2
Knowing
EsteLauder
0.4
0.4
0.2
0.2
BCBGMaxAzria
ElizabethArden
0.3
0.3
0.2
0.2
EdHardyBornWild
ElizabethArden
0.3
0.3
0.2
0.2
EdHardyWomen
ElizabethArden
11
0.7
0.3
0.4
0.2
(Continued)
4C30
FragrancesforWomen
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
%Oftotal
2012
2011
2012
LUXURY(Continued)
ForbiddenEuphoria
Coty
0.3
0.3
0.2
0.2
HappyHeart
EsteLauder
0.3
0.3
0.2
0.2
Heat
Coty
0.6
0.3
0.3
0.2
HeatRush
Coty
10
0.7
0.3
0.4
0.2
Hypnose
L'Oral
0.4
0.3
0.2
0.2
LoveChloe
Coty
0.3
0.3
0.2
0.2
MichaelbyMichaelKors
EsteLauder
0.3
0.3
0.2
0.2
NarcisoRodriguez
Shiseido
0.3
0.3
0.2
0.2
Pulse
Coty
0.3
0.3
0.2
0.2
Ralph
L'Oral
0.4
0.3
0.2
0.2
Reb'lFleur
ParluxFragrances
13
0.9
0.3
0.5
0.2
BigPony2
L'Oral
0.3
0.1
CoutureCouture
ElizabethArden
0.3
0.3
0.2
0.1
Este
EsteLauder
0.3
0.3
0.2
0.1
Fancy
ParluxFragrances
0.5
0.3
0.3
0.1
FancyLove
ParluxFragrances
0.3
0.3
0.2
0.1
FlorabyGucciEauFraiche
Procter&Gamble
0.2
0.3
0.1
0.1
Glowing
Coty
0.3
0.1
HanaeMori
International
Cosmetics&Perfumes
0.3
0.3
0.2
0.1
Inspire
Procter&Gamble
0.3
0.3
0.2
0.1
Lola
Coty
0.6
0.3
0.3
0.1
LuckyYou
ElizabethArden
0.3
0.3
0.2
0.1
Oscar
L'Oral
0.3
0.3
0.2
0.1
PradaInfusionD'Iris
Coty
0.3
0.3
0.2
0.1
Pretty
ElizabethArden
0.3
0.3
0.2
0.1
Pure
EsteLauder
0.3
0.3
0.2
0.1
TheBeat
InterParfums
0.3
0.3
0.2
0.1
TrsorInLove
L'Oral
0.3
0.3
0.2
0.1
VeraWang
Coty
0.3
0.3
0.2
0.1
Villain
ElizabethArden
0.2
0.3
0.1
0.1
Amarige
LVMH
0.2
0.2
0.1
0.1
Boucheron
L'Oral
0.2
0.2
0.1
0.1
CKBeauty
Coty
0.3
0.2
0.2
0.1
CoolWaterWoman
Coty
0.2
0.2
0.1
0.1
FantasyBritneySpears
ElizabethArden
0.2
0.2
0.1
0.1
GucciByGucci
Procter&Gamble
0.2
0.2
0.1
0.1
Hearts&Daggers
ElizabethArden
0.6
0.2
0.3
0.1
(Continued)
4A30
4C31
FragrancesforWomen
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
2012
%Oftotal
2011
2012
LUXURY(Continued)
L'AirDuTemps
Coty
0.2
0.2
0.1
0.1
Lovely
Coty
0.3
0.2
0.2
0.1
MarcJacobs
Coty
0.2
0.2
0.1
0.1
ParisHilton
ParluxFragrances
0.3
0.2
0.2
0.1
Queen
ParluxFragrances
0.2
0.2
0.1
0.1
VeryIrresistibleIntense
LVMH
0.2
0.2
0.1
0.1
Womanity
Clarins
0.1
0.2
0.1
0.1
BabyPhatGoddess
Coty
0.1
0.1
0.1
0.1
BeautifulLove
EsteLauder
0.1
0.1
0.1
0.1
Believe
ElizabethArden
0.1
0.1
0.1
0.1
BeyondParadise
EsteLauder
0.1
0.1
0.1
0.1
ByNight
Procter&Gamble
0.1
0.1
0.1
0.1
CircusFantasy
ElizabethArden
0.1
0.1
0.1
0.1
Eat,Pray,Love
LVMH
0.2
0.1
0.1
0.1
EdHardyLove&Luck
ElizabethArden
0.1
0.1
0.1
0.1
Eva
FalicFashionGroup
0.1
0.1
0.1
0.1
Forever
ElizabethArden
0.1
0.1
0.1
0.1
Fresh
LVMH
0.1
0.1
0.1
0.1
GlowbyJLo
Coty
0.1
0.1
0.1
0.1
GucciEnvyMe
Procter&Gamble
0.1
0.1
0.1
0.1
GuessbyMarciano
Coty
0.1
0.1
0.1
0.1
JessicaMcClintock
J.McClintock
0.2
0.1
0.1
0.1
LollipopBling
ElizabethArden
0.1
0.1
0.1
0.1
Organza
LVMH
0.1
0.1
0.1
0.1
PalomaPicasso
L'Oral
0.1
0.1
0.1
0.1
Peace,Love,&Juicy
ElizabethArden
0.1
0.1
0.1
0.1
PleasuresDelight
EsteLauder
0.1
0.1
0.1
0.1
PleasuresExotic
EsteLauder
0.1
0.1
0.1
0.1
PureWhiteLinen
EsteLauder
0.1
0.1
0.1
0.1
SalvatoreFerragamo
FerragamoParfums
0.1
0.1
0.1
0.1
TommyGirl
EsteLauder
0.1
0.1
0.1
0.1
TrsorMidnightRose
L'Oral
0.2
0.1
0.1
0.1
UnforgivableWoman
EsteLauder
0.1
0.1
0.1
0.1
VeryHollywoodMichaelKors
EsteLauder
0.1
0.1
0.1
0.1
BurberryLondon
InterParfums
0.1
0.1
BurberrySportforWomen
InterParfums
0.1
0.1
EaudeCartier
ParfumsCartier
0.1
0.1
FairyDust
ParluxFragrances
0.1
0.1
(Continued)
4C32
FragrancesforWomen
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
2012
%Oftotal
2011
2012
LUXURY(Continued)
Allother
Chanel
0.2
0.2
0.1
0.1
Allother
EsteLauder
0.6
0.6
0.3
0.3
Allother
ElizabethArden
12
12
0.8
0.8
0.5
0.4
Allother
LVMH
21
22
1.4
1.4
0.8
0.8
Allother
Procter&Gamble
26
27
1.7
1.7
1.0
1.0
Allother
L'Oral
26
27
1.7
1.7
1.0
1.0
Allother
Coty
29
30
1.9
1.9
1.1
1.1
156
170
10.4
10.7
6.0
6.3
1,505
1,582
100.0
100.0
57.6
58.2
Allother
Total
SPECIALTY
Bath&BodyWorks
LimitedBrands
248
260
35.7
35.2
9.5
9.6
VSFantasies
LimitedBrands
100
105
14.4
14.2
3.8
3.9
DreamAngels
LimitedBrands
95
100
13.7
13.5
3.6
3.7
Bombshell
LimitedBrands
50
53
7.2
7.2
1.9
2.0
Pink
LimitedBrands
25
27
3.6
3.7
1.0
1.0
Angel
LimitedBrands
24
26
3.5
3.5
0.9
1.0
Gorgeous
LimitedBrands
24
26
3.5
3.5
0.9
1.0
Abercrombie&Fitch
Abercrombie&Fitch
19
20
2.7
2.7
0.7
0.7
Gap
TheGap
17
16
2.4
2.2
0.7
0.6
VerySexyforHer
LimitedBrands
14
15
2.0
2.0
0.5
0.6
BananaRepublic
TheGap
10
12
1.4
1.6
0.4
0.4
Incredible
LimitedBrands
TheBodyShop
L'Oral
Rapture
10
1.4
0.4
10
10
1.4
1.4
0.4
0.4
LimitedBrands
0.9
0.8
0.2
0.2
SexyLittleThings
LimitedBrands
0.9
0.8
0.2
0.2
AmericanEagle
AmericanEagle
0.3
0.4
0.1
0.1
Bebe
Bebe
0.3
0.4
0.1
0.1
Crabtree&Evelyn
Crabtree&Evelyn
0.4
0.4
0.1
0.1
HenriBendel
LimitedBrands
0.3
0.4
0.1
0.1
Allother
LimitedBrands
Allother
Total
1.0
0.3
0.3
0.1
31
33
4.5
4.5
1.2
1.2
695
739
100.0
100.0
26.6
27.2
MASS
HalleBerry
Coty
12
12
5.8
6.1
0.5
0.4
JovanMusk
Coty
12
12
5.8
6.1
0.5
0.4
CalgonBodyMists
Coty
10
4.4
5.1
0.3
0.4
DoveBodyMists
Unilever
4.4
4.5
0.3
0.3
CelineDion
Coty
4.4
4.0
0.3
0.3
(Continued)
4A32
4C33
FragrancesforWomen
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
%Oftotal
2012
2011
2012
MASS(Continued)
BodyFantasies
YellowWoodPartners
3.9
3.5
0.3
0.3
FaithHill
Coty
2.9
3.0
0.2
0.2
DegreeBodyMists
Unilever
2.4
2.5
0.2
0.2
SecretBodyMists
Procter&Gamble
1.5
2.0
0.1
0.1
Shania
Coty
1.9
2.0
0.2
0.1
WhiteShoulders
ElizabethArden
1.9
2.0
0.2
0.1
Chantilly
DanaClassic
Fragrances
1.9
1.5
0.2
0.1
JeanNat
Revlon
1.9
1.5
0.2
0.1
Tabu
DanaClassic
Fragrances
1.5
1.5
0.1
0.1
AntonioBanderas
Coty
1.5
1.0
0.1
0.1
LadyStetson
Coty
1.0
1.0
0.1
0.1
Love'sBabySoft
DanaClassic
Fragrances
1.5
1.0
0.1
0.1
VanillaFields
Coty
1.5
1.0
0.1
0.1
WildMusk
Coty
1.5
1.0
0.1
0.1
WindSong
YellowWoodPartners
1.5
1.0
0.1
0.1
AdidasMovesforHer
Coty
1.0
0.5
0.1
Charlie
Revlon
1.0
0.5
0.1
Ciara
Revlon
0.5
0.5
Primo!
YellowWoodPartners
1.0
0.5
0.1
Privatelabel
Privatelabel
35
37
17.0
18.7
1.3
1.4
Allother
Coty
16
14
7.8
7.1
0.6
0.5
39
41
18.9
20.7
1.5
1.5
206
198
100.0
100.0
7.9
7.3
Allother
Total
DIRECT
UnpluggedforHer
Avon
16
8.1
0.6
OutspokenIntensebyFergie
Avon
14
15
6.8
7.6
0.5
0.6
OutspokenbyFergie
Avon
12
13
5.8
6.6
0.5
0.5
Imari
Avon
11
11
5.3
5.6
0.4
0.4
EternalMagic
Avon
10
10
4.9
5.1
0.4
0.4
MyLife
Carol'sDaughter
10
3.9
5.1
0.3
0.4
Today
Avon
10
10
4.9
5.1
0.4
0.4
FarAway
Avon
3.9
4.0
0.3
0.3
ImariSeduction
Avon
3.9
4.0
0.3
0.3
RareGold
Avon
3.9
4.0
0.3
0.3
RareDiamonds
Avon
3.4
3.5
0.3
0.3
Haiku
Avon
2.9
3.0
0.2
0.2
(Continued)
4C34
FragrancesforWomen
$Million
Tradeclass/brand
Company
2011
2012
%Oftradeclass
2011
2012
%Oftotal
2011
2012
DIRECT(Continued)
ThinkingofYou
MaryKay
2.4
3.0
0.2
0.2
Mark
Avon
2.9
2.5
0.2
0.2
StepIntoSexy
Avon
1.9
2.5
0.2
0.2
Tomorrow
Avon
2.4
2.5
0.2
0.2
BelaBelara
MaryKay
1.9
2.0
0.2
0.1
ExpressionsbyReeseWitherspoon
Avon
14
6.8
1.5
0.5
0.1
Journey
MaryKay
1.5
1.5
0.1
0.1
Velocity
MaryKay
1.5
1.5
0.1
0.1
Affection
MaryKay
2.4
1.0
0.2
0.1
Always
Avon
1.9
1.0
0.2
0.1
Belara
MaryKay
1.0
1.0
0.1
0.1
Candid
Avon
0.5
0.5
HerveLegerFemme
Avon
2.9
0.5
0.2
Allother
Avon
22
12
10.7
6.1
0.8
0.4
Allother
MaryKay
12
12
5.8
6.1
0.5
0.4
10
3.9
5.1
0.3
0.4
206
198
100.0
100.0
2,612
2,717
Allother
Total
TOTAL
7.9
7.3
100.0
100.0
Unitsales
Unitsalesoffragrancesforwomenincreasefrom155.0millionpackagesin2011,up3.2%
to160millionpackagesin2012.
Retailsales
Salesattheretaillevelareestimatedat$4,363millionin2012,upfrom$4,191millionin
2011.
CATEGORYDEVELOPMENT
Markettrends
Forthethirdyearinarow,thefragrancesforwomencategorygrowscomparedtotheprior
year.
Salesfor2012grow4.0%andarethehighestsince2007.
Unitsalesmoveupwards,growing3.2%in2012.
4A34
FragrancesforWomen
The fragrances for women category is trending upward, but sales have just reached pre
recessionlevels.
Growthof4.0%fortheyearisbehindthegrowthof6.9%during2011.
The category is negatively affected by the uncertain economy, the devastation by
Superstorm Sandy in the Northeast, along with the senseless shootings of innocent
Americans,whichhelpedstifletheholidayspirit.
Thegrowthofthefragrancescategorycontinuestobedependentonholidaysales.
Additionally,anincreaseinforeigntouristswhousefragrancesonaregularbasisfindit
lessexpensivetopurchaseintheUnitedStatesthanintheirhomeland,alsohelpsgrow
thecategoryssales.
Thespecialtytradeclassexperiencesthehighestgrowthrate,up6.3%,followedbythe
luxurytradeclassat5.1%.
Boththemassandthedirecttradeclassesobservedecliningsales.
The categorys growth continues to be driven by classics, such as Chanels Coco

Mademoiselle, Chanel No.5, and Chance; along with the expansion of popular franchises,
suchasElizabethArdensJuicyandCotysMarcJacobs.
Classicsandbrandsfromestablishedmarketersandfranchises,exhibitthemostvigor.
As in 2011, several new celebrity scents launched in 2012 are targeted at younger
consumersattractingsomeofthemtothefragrancecounterforthefirsttime.
These new celebrity scents include Elizabeth Ardens Justin Beibers Girlfriend, Nicki
MinajsPinkFridayandTaylorSwiftsWonderstruckEnchanted;andCotysLadyGagas
Fame;andMadonnasTruthorDare.
Attheoppositeextreme,nichescentsalsohelptogrowthefragrancesforwomencategory.
Scents from marketers, such as By Kilian, Maison Frances Kurkdjian, Houbigant Paris,
Creed, and Bond No. 9, create excitement in the industry and offer a point of
differentiation.
These scents are priced as high as several hundred dollars, based on their ingredient
compositionandtheirstayingpower.
The appeal of niche scents is that these scents are not meant for the masses due to
their high price and limited distribution, and therefore offer a distinctive opportunity
forapersontosmelldifferentfromtheircolleaguesandfriends.
While collectively these scents are estimated to account for about 5% of the total
fragrancesforwomenmarketintheluxurytradeclass,eachofthesescentsindividually
hassmallsalesandisnottrackedinthisreport.
Nichescentsaretypicallynotlargeenoughinvolumeforthelargecompaniestooffer,
especiallywiththeirselectdistributiontohighendboutiquesanddepartmentstores,
suchasNeimanMarcus,BergdorfGoodman,andBarneys.
Highend retailers are interested in these scents as they carry a higher margin than
mainstream brands, and allow them to carry a different assortment of scents from
thosefoundindepartmentstores.
4C35
4C36
FragrancesforWomen
Growthinthefragrancesforwomencategoryoccursinthefollowingareas:
Both, the luxury trades class and the specialty trade class experience aboveaverage
growthat5.1%and6.3%,respectively.
The other trade classes of mass and direct experience declines in 2012. Avon is
responsibleforthedeclineinthedirecttradeclass.
Classicsandbrandsfromestablishedhousesexperiencethemostgrowthduring2012.
New celebrity scents targeting younger female consumers create some energy in the
category.
Majorbeautycompaniesalignwithfashiondesignersoraccessoryhousestodevelop
newscents.
Thetrendtowardsmorenaturalpersonalcareproductscouldbeoneofthefactorsstifling
realgrowthinthefragrancescategory.
The media reports the possibility of harmful ingredients in fragrance products which
couldaffectthehormonesandtheendocrinesystem.
Few fine fragrances contain all natural ingredients; most fragrances include synthetic
ingredients.
Furthermore, all personal care products are required to display their ingredient
composition on the package, with only a few exceptions. Fragrance formulations are
considered trade secrets and are exempt from disclosure; hence, there is a push by
variousadvocacygroupstomakeitmandatorytohavetheseingredientsmadepublic.
Instead body sprays, scented body washes, and hand and body lotions, and even air
products, such as candles and room scents, are utilized as a replacement for fine
fragrances.
Inaddition,thereareanumberofotherfactorsthatcontributetothelackofrobustgrowth
inthefragranceindustry.
Fragrancesaresavedforspecialoccasionsratherthandailyuse,reducingoverallusage.
This decline in usage can partly be attributed to the more casual workplaces where
employees do not get dressed up as much as in the past, coupled with more people
workingfromhomeonaregularbasis.
Inacontinuingtrend,consumersnolongerownawidearrayoffragrances,butrather
juststicktoone,orafewsignaturescents.
A further challenge to the industry is the movement to ban the wearing of fragrances at
workplaces, which is gaining awareness in some areas of the United States, negatively
affectingthecategorysfuturesales.
InDecember2012,NewHampshireintroducesalegislationbarringstateemployeesin
contactwithmembersofthepublicfromwearingfragrancesduringtheworkday.
Private employers and other government agencies in the United States and Canada
haveimplementedbansonthewearingoffragranceintheworkplace,suchasthecity
ofDetroit,MI;Portland,OR,andattheU.S.CensusBureau.
In Europe, there is a movement to ban fragrances that include certain ingredients
includingthetopsellingChanelNo.5whichissaidtoincludeatreemossthatcanset
offallergicreactions.AsimilarmovementcouldpotentiallyspreadtotheUnitedStates.
4A36
FragrancesforWomen
Flankers,lineextensions,andmigrationofscentstosecondarychannelscontributetothe
declineinbrandequityandposeanothersetofchallengestotheindustry.
Marketerscontinuetolaunchflankers,whichcapitalizeonthemasterscent,butata
slower pace than in the past. The main issue with flankers is that when attention is
placedonthenewintroduction,themainbrandtypicallyexhibitsdecliningsales.
Procter&GamblesGucciGuiltydeclinesnearly32%duringtheyear,withthelaunchof
GucciPremiere.
Coty and Elizabeth Arden offer luxury scents in mass channels after it has been on
counterforafewmonths.
Sometimesthisisintentionallydonebymarketerstohelpgrowsales,oristheresultof
divertedgoods,butineithercase,thesepracticesconfuseandfrustratetheconsumer,
contributingtotheerosionofthebrandsequity.
Another challenge is that the retail environment for fragrances continues to evolve, as
consumersareincreasinglyvalueconscious.
Retailersstarttheholidaysellingseasonearly,andofferpromotionalpricingonholiday
items from as early as October. However, most of the promotional pricing does not
applytofragranceandbeautyitems.
Giftwithpurchase (GWP) and purchasewithpurchase (PWP) are powerful luxury
beauty goods drivers, and consumers typically plan their purchase around these
offeringswhichoccursonlyalimitednumberoftimesduringtheyear.
Celebrityfragrances,launchedintheluxurytradeclass,areofferedforsaleinthemass
channelsforashortperiodoftime,typicallyatlowerpricepoints,enticingconsumers
towaitforthepricetobereduced.
In a growing trend, giftcard purchases are increasing as they offer the receiver the
opportunitytoactuallypickoutthegifttheywant.
Consumers often prefer todo their holiday shopping online, which is not suitable for
fragrancepurchasing.
Fragrancesforwomenpackagingcontinuestobecomemoreinnovativeandhelpscreatean
urgetobuyatthepointofpurchase.
While the classic scents are in classic type bottles, many of the newer scents have
interestingbottledesignstohelpcreateabuzz.LancmesLaVieEstBelleaimstobea
classicandishousedinaredesignedversionofa1949classicbottle.
MarcJacobsDotresemblesaredandblackladybug.
NickiMinajsPinkFridayisacaricatureofherselfandfeaturesabustwithagoldface,
pinkwig,andhergoldnameplatenecklace.
Justin Beibers Girlfriend is a purple heartshaped bottle housed inside a pink and
purpleslinkytypecasing.
Black packaging is popular among some new launches during 2012 including Lady
GagasFame,MadonnasTruthorDare,andChanelsNoir.
JenniferLopezsGlowingsbottlelightsupandglowsfor15secondsafterspraying.
4C37
4C38
FragrancesforWomen
Newfragranceformscontinuetoremainpopular.
Following a trends that has been popular for several years, rollerballs still have high
momentum among young consumers due to their lower price points and ability to
storeinthepurseorworkdesk.Somebrandsalsoofferrollerballcollections,suchas
MarcJacobsthatoffersarollerballtrioofitstopsellingscents.
Some brands offer spray pens which are the same size as the rollerball but with a
sprayheadinsteadofarollontipintheircollection.JuicyCoutureoffersaspraypen
collectionofthreescents.
Packaging that includes charms as rings, pendants, and other items helps to keep
interest high among the younger, more costconscious consumers. Sample size
collectionscontinuetobepopular.
Smallsizesappropriatefortravelandsamplesizecollection,suchascoffretscontinue
tobepopularandappealtoconsumersduetothevaluepricingandvarietyofscents.
Viktor&RolfsFlowerbombcomesinatravelduo,andChloesscentsareavailableasa
miniatureduo.
Toolsandeventsareutilizedtohelpconsumersnarrowdownfragrancepurchases.
Itisnotknownyethowsuccessfulthesetoolsreallyare,butmanyareofferedtohelp
guidetheconsumertothescentthatmightbeappropriateforthem.
Retailers,bothinstoreandonline,includingMacys,Nordstrom,Sephora,andBath&
Body Works offer fragrance finder tools to help consumers discover their fragrance
personalityandthescentmostappropriateforthem.
SephoralaunchesFragranceFlightBarsatsomeofitslocationsduring2012,whichare
basedoffitsSensoriumlimitedengagementmultiscentsoryexperienceshowcasedat
one Manhattan location during 2011. These Fragrance Flight Bars allow customers to
checkoutscentsbasedontheir"impressions,"ratherthanbytraditionalfragranceThe
scents are in unbranded containers and are classified asAddictive, Playful, Casual or
Chicallowingpeopletoexperiencehoweachfragrancemakesthemfeel.Inthehope
thatfragrancepurchasingwillbeaneasierandmorerewardingexperience.
Sniffapalooza invites perfume enthusiasts, representatives from fragrance houses,
journalists, authors, and celebrities from around the world to various events that
includeworkshopsandpreviewsofnewlauncheswithperfumers.
Specialeventsfromretailersoccurseveraltimesduringtheyeartoacquaintconsumers
withnewscentsandoffersamplestopotentialcustomers.NordstromhostsaBeauty
Trend show that travels across the country, and a fragrance event that acquaints
consumers with new scents and other products. In 2012, Bath & Body Works hosts
AmericasFavoriteFragranceevent.
4A38
FragrancesforWomen
Retailerscontinuetobeselectiveaboutthescentstheycarry,astheyareafraidofbeingleft
withunsoldinventoryasexperiencedwhentherecessionfirststarted.
Departmentandspecialtystorestypicallyplayitsafewithclassicscentsandonlyadd
newfragrancesfromsuccessfulbrandsorfranchises.Highenddepartmentstoresstay
awayfromcelebrityscentsasthesequicklymigratetomassretailers.
Department and specialty stores carefully monitor their fragrance inventory and are
frequentlyoutofstockonthemostindemandscents.
The department store channel reduces the number of sales associates, driving the
consumertoshopfromotherchannels.
M&Aactivity
A number of new licensing agreements and corporate developments are signed or take
effectduring2012,withmoreannouncedfor2013.
AlfredDunhillannouncesthatitisswitchinglicensingpartnerseffectiveApril2013,to
InterParfumsina10yeardealfromProcter&Gamble.
InterParfumshastwomajorlicensechangesduringtheyear.
ItacquiresthefragrancelicenseofKarlLagerfieldinearly2012fromCoty.
InterParfumslosesthefragrancelicenseofBurberry,asthecompanytakesownership
ofitsownfragrancelicenseasof2013.
Kenneth Cole signs a licensing deal with Parlux effective January 2013, after 10 years
withCoty.
CotywhichhasdistributedPuigsfragrancesinNorthAmericaforthepastsixyearswill
ceasedoingsowhenthelicenseexpiresonJune30,2013.
Inlate2012,CotysignssingerKatyPerryforanewlineoffragrancestobedeveloped
andmarketedbyCoty.
ClarinsFragranceGroupwilldistributePuigsfragrancesinNorthAmericaeffectiveJuly
1,2013.
Elizabeth Arden acquires the global fragrance licenses of Ed Hardy, True Religion, and
BCBGMaxAzriafromNewWaveFragrancesinmid2012.Italsoacquiresthefragrance
licensesofJustinBieberandNickiMinajfromGiveBackBrands,LLC.
YellowWoodPartnersacquiresParumsdeCoeur,Ltdinfall2012.
Notablenewproducts
Thereareanumberofnotablenewlaunchesthathaveconsiderablesalesduring2012and
addexcitementtothecategoryandinclude:
LaVieEstBelle(LOral)$14million
Girlfriend(ElizabethArden)$14million
MarcJacobsDot(Coty)$14million
Fame(Coty)$11million
PinkFriday(ElizabethArden)$11million
TruthorDare(Coty)$11million
GucciPremiere(Procter&Gamble)$10million
4C39
4C40
FragrancesforWomen
Table4C17:SelectNewFragrancesforWomenIntroducedintheUnitedStatesin2012
Company
Brand
Description
Avon
JonBonJovi
UnpluggedforHerisacollaborationbetweenAvonandJonBonJoviofferingfloral
orientalcompositionstartingwithgourmetnotesofplumandcitrus
Chanel
CocoNoir
ChanelsnewscentwithtopnotesofgrapefruitandCalabrianbergamotfollowed
byaheartofrose,narcissus,rosegeraniumleaf,andjasmine
Coty
HalleBerry
Closerisconsideredamodernfemininefloralthatopenswithaccordsofozone,
wildraspberry,andwaterlily
Coty
JenniferLopez
Glowingisawoodyfloralwithtopnotesofbergamot,mandarin,andcypressina
bottlethatlightsupandglowsfor15secondsafterused
Coty
LadyGaga
LadyGagasdebutscent,Fameisbuiltonthreemainaccords:darkaccord,sensual
accord,andlightaccord.ThedarkaccordincludespoisonousflowerBelladonna
andincense.Scentspraysonblackandturnsclearontheskin,andishousedina
blackbottle
Coty
Madonna
TruthorDareisMadonnasfirstscentandisdescribedasbeingbothlightanddark,
openingwithnotesofgardenia,creamytuberose,andneroli
Coty
MarcJacobs
Dotisfloralfruity,surroundedwithexoticnotesofcoconutandwrappedinsoft
vanillainaladybuginspiredbottle
ElizabethArden
JustinBeiber
GirlfriendisJustinBeiberssecondscentandisgearedtohisadolescentfanbase.
Topnotesincludemandarin,blackberry,pear,andstrawberry
ElizabethArden
NickiMinaj
FirstfragrancefromNickiMinajPinkFridayisnamedafterherfirstalbumofthe
samename,isafloralmuskcontainingnotesofpinkflowerpetals,creamyvanilla,
musk,andwoods.ThefragranceishousedinabustshapedbottleofMinaj
completewithapinkwig
ElizabethArden
TaylorSwift
WonderstruckEnchantedisthesecondfragrance,presentedasaflankerfromthe
youngpopcountrysingerTaylorSwift.Scentisanorientalgourmandthatopens
withnotesofwildberries,pinkpoppy,andpassionfruit.Asintheoriginal,the
bottleisadornedwithdanglingcharms
EsteLauder
DonnaKaren
Womanhastopnotesofsandalwoodandorangeblossom
LOral
Lancme
LaVieEstBellereportedlytookthreeyearstoformulatewithIrisasthekey
ingredientsurroundedbyorangeblossomsandjasmine.Theflaconisaredesigned
versionofaclassicLancmebottlefrom1949
LOral
RalphLauren
BigPonyforHeristhefourfragrancefemalecounterpartofthemenscollection
witheachscentnumberedfromonetofourandhousedinclearbottleswhich
showthebrightlycoloredjuice
LimitedBrands
Bath&Body
Works
Newscentsduring2012include:CashmereGlow,ForeverRed,andLoveLoveLove
LimitedBrands
VictoriasSecret
Incredible,namedafterthelingerielaunchofthesamename,isafloralfruityscent
withtopnotesofwhitepeachcombinedwithpearandlotusaccords
Procter&Gamble
Gucci
GucciPremiereissaidtobeinspiredbygownsfromtheGucciPremierecouture
collectionwithtopnotesofbergamotandorangeblossom
Salesbyproducttype
Allproductcategoriesexperienceincrease,inlinewiththetotalmarket.
The largest dollar volume increase is in the perfumes, toilet waters, and colognes
category.
4A40
FragrancesforWomen
Table4C18:SalesofFragrancesforWomenintheUnitedStatesbyProductType,2011and2012
$Million
Producttype
%Oftotal
2011
2012
2011
2012
Change,%
1,943
2,021
74.4
74.4
4.0
418
435
16.0
16.0
4.1
2,361
2,456
90.4
90.4
4.0
251
261
9.6
9.6
4.0
2,612
2,717
100.0
100.0
4.0
LIQUIDPRODUCTS
Perfumes,toiletwaters,andcolognes
Bodymistsandsplashes
Total
ANCILLARYPRODUCTS
TOTAL
COMPETITION
Bycompany
Table4C19:ManufacturersSalesofFragrancesforWomenintheUnitedStatesbyCompany,
2011and2012
$Million
Company
%Oftotal
2011
2012
2011
2012
LimitedBrands
602
639
23.0
23.5
6.1
Coty
315
345
12.1
12.7
9.5
EsteLauder
244
238
9.3
8.8
(2.5)
ElizabethArdena
201
188
7.7
6.9
(6.5)
LOral
167
181
6.4
6.7
8.4
Chanel
159
181
6.1
6.7
13.8
Avon
156
146
6.0
5.4
(6.4)
Procter&Gamble
133
134
5.9
4.9
0.8
LVMH
91
96
3.5
3.5
5.5
MaryKay
34
32
1.3
1.2
(5.9)
Clarins
33
37
1.3
1.4
12.1
InterParfums
28
41
1.1
1.5
46.4
TheGap
27
28
1.0
1.0
3.7
Parlux
34
20
1.3
0.7
(41.2)
Abercrombie&Fitch
19
20
0.7
0.7
5.3
335
391
12.8
14.4
16.7
Allother
Change,%
Total
2,612
2,717
100.0
100.0
4.0
aElizabethArdenpurchasesthefragrancebrandsofNewWaveFragrancesandGiveBackBrands
during2012.
4C41
4C42
FragrancesforWomen
LimitedBrandscontinuestobetheleaderasthelargestmarketeroffragrancesforwomen,
witha23.5%shareduring2012,upfrom23.0%in2011.
Salesgrow6.1%duringtheyearfrom$602millionin2011to$639millionin2012.
All divisions of Limited Brands contribute to the companys growth as Bath & Body
Works,VictoriasSecret,andPinkexperiencegainsin2011.
New scents launched on a regular basis at favorable price points, along with
promotionalpricingonmultiplepurchasesistheprimestrategyforthesebrands.
Thesemiannualsalesprovidesignificantdiscountsonproductstomovemerchandise,
andmakewayfornewitemsisthekeypromotionaleventoftheyear.
NewscentsfromBath&BodyWorksduringtheyearincludeCashmereGlow,Forever
Red,andLoveLoveLove.
Bath & Body Work repackages its body splashes and relaunches them as fragrance
mistsinearly2012.
The major womens fragrance launch for Victorias Secret is Incredible, launched at
approximatelythesametimeasthebraofthesamename.
Both Bath & Body Works and Victorias Secret experience enormous success in the
fragrances for women category, after having tried to capture the fragrances for men
categorytonoavail.
Cotyisthesecondleadingmarketer,commanding12.7%oftotalsalesin2012andgrowing
by9.5%from2011.
Coty continues to compete in both the luxury and mass trade classes with an
assortmentofcelebrityanddesignerscentsandworkstobecomeaglobalfragrance
leader.
The company scouts hot celebrities and develops scents under their names.
Celebrities that offer debut scents with Coty during 2012 include Lady Gaga and
Madonna.
Aside from the debut of Lady Gagas Fame and Madonnas Truth or Dare, the only
othermajorfemalefragrancelaunchesoftheyearareMarcJacobsDotandJennifer
LopezGlowing.
Coty launches a series of new scents in early 2013 including Guess Girl and See by
Chloe.
The only major mass launch for Coty during 2012 is an extension of the Halle Berry
franchise,Closer.
EsteLauderremainsinthirdplacewiththreeofthetop11luxuryfragrances.
Thecompanyhasan8.8%categoryshare,downfrom9.3%in2011,assalesdip2.5%
duringtheyear.
Beautifulssalesareflatfrom2011,whileCashmereMistandPleasureshaveincreasing
sales.Thesethreearethecompanyslargestfragrancebrands.
Asidefromscentsunderthemajorbeautybrands,suchasEsteLauderandClinique,
the company works to put together a portfolio of designer brands including Donna
Karan, Coach, Michael Kors, Tommy Hilfiger, and more recently Ermenegildo Zegna,
ToryBurch,andMarni.ThecompanyacquiredthefragrancefranchisesforZenga,Burch,
andMarniinlate2011,andishandledbytheAramisandDesignerFragrancesdivision
ofEsteLauder.
TheDonnaKaranfranchiseisextendedin2012withthefalllaunchofWoman.
InitialscentsfromZengaandMarnilaunchinearly2013,andanewCoachscentcalled
LovelaunchesintimeforValentinesDay.
4A42
FragrancesforWomen
ElizabethArdenmovesintofourthplacewiththeacquisitionoffragrancebrandsfromNew
WaveFragrancesandGiveBackBrands.
Via these acquisitions Elizabeth Arden acquires the global fragrance licenses of Ed
Hardy,TrueReligionandBCBGMaxAzriafromNewWaveFragrancesinmid2012.The
companyalsoacquiresthefragrancelicensesofJustinBieberandNickiMinajfromGive
BackBrands,LLC.
These acquisitions help Elizabeth Arden achieve a 6.9% share in the fragrances for
womencategory.However,overallsalesdeclineby6.5%.
Salesdropfrom$201millionin2011to$188millionin2012.
SalesdeclineduetothesoftnessinthenewlyacquiredEdHardyfranchise,alongwitha
salesdropofthefirstJustinBeiberscent,andweaknesswiththesecondscent.
ThemajornewscentfromElizabethArdenduring2012isNickiMinajsPinkFridayand
JustinBeibersGirlfriend.
LOraldropstofifthplacewith6.7%shareandsalesup8.4%to$181million.
ThebiglaunchoftheyearisLaVieEstBellewhichachievessalesof$14millionwith
justafewmonthsoncounter.
Viktor & Rolf Flowerbomb continues to grow with an increasing distribution as this
scentjoinsthetop10withjustafewyearsoncounter.
TheonlyothermajorlaunchduringtheyearisthefemaleversionsoftheRalphLauren
Polocollection;however,thesedidnotperformaswellastheirmalecounterparts.
Bybrand
Bath&BodyWorks(LimitedBrands)remainstheleadingbrandinthecategory,withsales
up4.8%from$248millionin2011to$260millionin2012.
The brand holds a 35.2% share of the specialty segment and a 9.6% share of the
category.
New fragrances added to its portfolio in 2012 include Cashmere Glow, Forever Red,
andLoveLoveLove.
Since2009,Bath&BodyWorkshasaddedhighendscentscomposedofseveralnotes
toitsportfolio,suchasCashmereGlow,ForeverRed,andLoveLoveLovelaunchedin
2012However,thebrandstilloffersseveralofitsclassicscents,wherethenameofthe
scentisdescriptiveofthefragrancenotes,suchasCountryAppleandCitrusMelon.
Bath&BodyWorksfragrancesaretypicallysomeofthelowestpricedscentsfoundat
theshoppingmallandthesefavorablepricepointsalongwithfrequentpromotionsand
twosemiannualsaleshelpgrowthebrand.
Promotionsareimportantforthesuccessofthisbrandwhichareofferedyearround
andincludebuythreegettwofreeandbuythreegetthreefreeoffers.
Additionally, the special online fragrance exclusive promotions are offered on the
brandswebsite.
Smallsizescentsalongwithtravelsizeversionsofnewreleasesaresoldnearthecash
registertoencouragetrialandimpulsepurchasing.
4C43
4C44
FragrancesforWomen
VS Fantasies (Limited Brands), formerly Victorias Secrets Garden, is the secondlargest

brand in the category, with a 5.0% increase in sales from $100million in 2011 to
$105millionin2012.
VS Fantasies accounts for 14.2% of the specialty trade class and 3.9% of overall
fragrancessales.
Newscentsareaddedtotheline,andunderperformingonesarediscontinued.
Thecollectioncontinuestodowellduetoitsattractivepricepointsandregularlyoffers
promotionsofthreefor$24.00,orfivefor$30.00.
TheDreamAngelsmasterfranchisefromVictoriasSecret(LimitedBrands),ranksthirdwith
salesof$100million,up5.3%from$95millionin2011.
Thecompanyworkstopromoteitsnewerscents,suchasIncrediblelaunchedin2012.
ChanelsCocoMademoiselleranksfourthandistheleaderintheluxurysegment.
Salesgrow11.5%in2012to$58million.
The brand is supported with magazine and television advertising, along with online
supportduringtheholidaypurchasingperiod.
A new broadcast advertising campaign premieres in 2012 featuring actress Keira
KnightleyridingthroughParisonamotorcycle.
In fifth place is another Victorias Secret scent Bombshell, which grows 6.0% during its
secondfullyearinstores.
RETAILDISTRIBUTION
Specialtystorescontinuetogrowandmaintainthetopspotastheleadingchannelforthe
purchaseoffragrancesforwomen.
The specialty stores channel grows because of increasing sales from vertically
integrated retailers, such as Bath & Body Works and Victorias Secret, along with
growthfromcosmeticspecialtystores,suchasSephoraandUlta.
Departmentstorestrailspecialtystoresbyonesharepoint,increasingshareslightlyas
consumersreturntodepartmentstores.
However, retail share for mass merchandisers and drug stores drop slightly as
consumersreturntohighendretailersforthepurchaseoffragrances.
4A44
FragrancesforWomen
Table4C20:ManufacturersSalesofFragrancesforWomenintheUnited
StatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Specialtystores
34
35
Departmentstores
33
34
Massmerchandisers
14
12
Directsales
11
12
Drugstores
Foodstores
100
100
Total
MARKETINGACTIVITY
Price and gift promotions along with sampling and instore activities are the main ways
womensfragrancesaremarketedacrossallretailchannels.
Samplingremainsimportantforalltradeclasses.
New launches typically receive heavy promotional backing generally consisting of media
advertisements,sampling,anonlinecomponent,andotherpromotionsincludingcontests.
Socialmediaisnowincludedasoneofthemarketingtoolsutilized,inadditiontoevent
sponsorshipsandsampledissemination.
TheInternetandsocialmediaconstituteanincreasingportionofbrandsmarketingefforts,
asthesearelessexpensivewaystoconnectwithconsumerswhencomparedtotraditional
advertising.
The Internet also provides tools that consumers can use in the scent purchasing
process,suchasfragrancefindertypetoolsbasedonconsumersresponsestoasetof
questions.
The utilization of social media is seen as a way for brands to connect with younger
consumers.
Over the past few years blogger outreach is used by an increasing percent of beauty
brandswherebytheyprovidefashionandbeautybloggersinformationandsamplesof
new products so that the recipients can blog about these and help create additional
buzz.
YouTubevideoscontinuetobeusedtocomplementabrandsmarketingstrategyand
servetwo majorpurposes:thefirstistocommunicatethestoryaboutthescentand
secondlytoprovideanoutletforbroadcastingvideos,advertisingthescent.
4C45
4C46
FragrancesforWomen
Inapracticethatisunchangedforoveradecade,prestigemarketerscontinuetoprovide
samples and offer promotional programs, such as valuepriced gift sets, catalog blowins,
fragrancestrips,GWPoffers,andPWPoffers.
Sampleshelpconsumerstryabrandbeforemakinganinvestment.
Commonsamplingmethodsincludefragrancevialsattachedtocards,scentedstripsin
magazines,andscentedblottercardsorribbonsdistributedatretailstores.
Specialtyretailersanddepartmentstoresofferseveraldifferentwaysforconsumersto
sampleascent.Somebrandsprovideretailersreadymadevialscontainingthescent.
Someretailershavetheabilitytofillthelittlevialswithascentuponrequest.
Sephoracontinuestooffersamplersetswheretheconsumercantryoutvariousscents
and then redeem the enclosed gift certificate for a fullsized bottle of the preferred
scent.
Giftsetsareincreasinginpopularityandserveasapromotionalitemonacontinualbasis.
Thesesetstypicallycontaineitheravarietyoffragranceminiatures,orafragranceand
ancillaryproducts.
Thesesetsarepopularduetotheiremphasisonvalueandthefactthattheytypically
costlessthaniftheindividualcomponentsarepurchasedseparately.
Severalbrandsdevelopgiftsetsoffragranceminiaturesthatarebundledtogetherand
appealtoconsumersdesireforvariety.
Department stores and specialty retailers rely on promotions, instore sampling and
displays,directtoconsumermailings,andemailtohelpspursales.
Strategicplacementoffragrancesinthestoresoftenattractsconsumerswhoarenot
specificallylookingtomakeafragrancepurchase,andaresometimesdoublyexposed
tothesamefragranceinastore.
Thesetwochannelsalsoofferspecialgiftsets,somemadeespeciallyforwomenthat
include the fragrances and ancillary products usually contained in a tote bag or
cosmeticcase.
Departmentandspecialtystoresalsoofferatotebagfilledwithfragrancesamplesasa
giftwithaminimumpurchase.
Inapracticeunchangedfordecades,thedepartmentstoreschannelemploysspritzer
people that spray a chosen scent on blotter paper for the consumer to test. Some
providesafetypinsoraribbonontheblotterpapersothattheconsumercanactually
wearthescentforawhiletomakesuretheylikeitbeforemakingapurchase.
Macys attempts to increase its fragrance sales during 2012 with an advertising
campaignthatpromotestheretailerasthefragranceauthority.
4A46
FragrancesforWomen
LeadingspecialtyretailbrandBath&BodyWorksandVictoriasSecretmakegreatuseof
positioning fragrance offerings in more than one location in a store, especially near the
checkoutcounters.
Victorias Secret and Bath & Body Works offer several of their scents in smaller sizes
nearthecheckoutcountersforimpulsepurchasing.
Victorias Secret promotes its products using a number of promotional activities,
including two semiannual sales in June and January; several GWPs and PWPs
throughout the year; and directmailing campaigns announcing new products and
offers.VictoriasSecretregularlyofferspromotionaldealsonitsvaluepricedFantasies
line.
Bath&BodyWorksregularlysendsoutoffersviaemailordirectmailtoconsumersin
itsdatabaseofferingpricediscountsonmultiplepurchases.Buythreegettwofreeand
buythreegetthreefree promotions are fairly common throughout the year.
Additionally,theretailersometimesofferssamplesofupcomingfragranceproducts,at
introductorypricesof$1.00or$2.00.
Sephora and Ulta increase their share of the fragrances market through a number of
endeavorswhicharepromotedinstore,ontheirwebsites,andthroughmailers.
Boththeseretailersofferloyaltyprogramswherebyconsumersreceiverewardspoints
basedonpurchasevolumes,whichareredeemableforvariousproductsandperks.
Sephora provides five free fragrance samples with any online fragrance purchase of
$25.00 or more. The retailer also offers a selection of fragrance promotion gifts
preparedinconjunctionwiththebrands.Forexample,aCliniquetoteisavailablewith
thepurchaseofselectfragrancesfromthebrand.
Ulta regularly mails scheduled brochures that highlight promotions to encourage the
purchaseoffragrances.Consumersreceivegifts,suchasatotebag,aninsulatedcooler,
candlesticks,orevenarobewiththepurchaseoffragrances,valuedaboveacertain
amount.
Drugchainsandmassmerchandiserspromotefragranceswithpromotionaldiscounts,such
asgiftsetsandpricediscounts,intheirflyers.
CVS,RiteAid,andWalgreensofferloyaltyprogramswherepointsareearnedbasedon
purchaseswhichcanberedeemedforfuturepurchases.
During2012,Walgreenspromotes4,000BalanceRewardspointswiththepurchaseof
selectscents.
Targetflyersin2012frequentlypromotedesignerandcelebrityfragrancesat15%off.
Sales associates and catalogs are used by persontoperson direct marketers to promote
newfragrances.
Avon typically promotes new fragrances on the cover of its brochures at the time of
theirlaunch.
Scentstripsareoftenfeaturedinitscatalogs.
MaryKayshowcasesitsfragrancesinitsLookBook.
4C47
4C48
FragrancesforWomen
Examplesofsomeluxuryfragrancepromotionsduring2012includethefollowing:
BradPittfrontsanewprintandbroadcastcampaignforChanelsNo.5andistheonly
malespokespersonsforafemalescent.
AnewbroadcastadvertisementforChanelsCocoMademoisellefeaturesactressKeira
LadyGagasFamedebutswithaprintcampaignimagefeaturingthesingernudewith
muchsmallerscalemenstrategicallyplaced,crawlingupherbody.Gagaalsolaunches
atwittercampaignaboutthescent.However,Fameislessinnovativethanexpected.
Gucci launches the Premiere scent with a broadcast and print campaign featuring
actressBlakeLively.
The launch of Nicki Minaj Pink Friday includes an extensive digital and social media
campaign,alongwithprintandbroadcastadvertisementsaroundtheholidays.
LancmesLaVieEstBelledebutswithanadvertisingcampaignfeaturingactressJulia
Roberts.
An increasing number of brands include YouTube videos of their advertisements on
theirwebsite.
Totalmediaexpenditures(TMEs)forwomensfragrancesdeclinein2012to$324.5million,
downfrom$392.5millionin2011.
Magazinesaccountfornearly70%ofthetotaladvertisingspend.
LVMH is the leading advertiser with TME of $59.6 million during 2012 for its JAdore
andMissDiorCheriebrands.
Cotyfollowsinsecondplacewithadvertisingexpendituresof$50.8million,downfrom
$75.0millionin2011.
Chanel follows in third place with $44.9 million in advertising expenditures, followed
closelybyProcter&Gambleat$40.9million.
DetailsonTMEareincludedintheAdvertisingsectionofthisreport.
OUTLOOK
Low to moderate growth is forecast during the next five years as the industry has many
hurdlestoovercome.
Evenbeforetherecessionstartedin2008,theindustryexperienceddecliningsalesdue
tolowerdemand.
Considerablechallengescontinuetoplaguetheindustrywhichneedstobeovercome
forsubstantialgrowthtobeexperienced.
4A48
FragrancesforWomen
Challengesnegativelyaffectingthefragrancesforwomencategoryareexpectedtoremain
fairlyconsistentoverthenextfiveyearscontinuingtoimpederealgrowthandinclude:
Lackofcompatibilitywiththegrowingtrendofnaturalpersonalcareproducts.
Increasing concern that fragrances can cause hormone disruptions, asthma, or other
unpleasantsideeffects.
The prohibition of fragrances in work environments mandated by companies or
requestedbycoworkers.
Amorecausalworkenvironmentwithfewerdressupopportunities.
A reduced demand for fragrances as gifts due to competition from other products
rangingfromconsumerelectronicstogiftcards.
Thefollowingisexpectedtooccurduringtheforecastperiod:
In lieu of becoming completely natural, companies are expected to take steps to
eliminateunnecessaryingredientsandincludemorenaturalones.
Companieswillworktobecomemoresustainablebyimprovingtheirenergyefficiency,
loweringtheiremissions,andofferingmoreecofriendlypackaging.
Anincreasingnumberofbrandsmayofferrefillabledecorativeflaconsasawaytobe
moreenvironmentallysensitive.
Theclassicscentswillremainstrongandcontinuetogrowastheyareviewedasthe
safe choice for many consumers that are keeping fewer fragrances than in previous
decades.
Companies,suchasCotyandElizabethArdenwillcontinuetoalignwithcelebritiesand
willbecomemorecautiousaboutthecelebritiesthattheychoose.
Coty and LOral are expected to continue their alignment with fashion designers,
whileEsteLauderwillaimhigherduetolicenseagreementswithhighendandniche
designers.
Whilenewnessdrivesthecategory,marketerswilllikelybemorecautiousofwhatthey
bringtomarketbecauseofthehighcostinvolvedinlaunchinganewscent.
Nichescents,costinginexcessof$100.00andwithlimiteddistributionareexpectedto
show the most growth over the forecast period because they provide the consumers
theopportunitytosmelldifferentthantherestoftheirfriends.
Someoftheissuesthatwilllikelyaffectthefragrancesforwomencategoryoverthenext
fiveyearsinclude:
New forms of fragrances in small sizes and at lower price points are expected to
increaseinpopularity,suchasfragrancepens,inadditiontorollerballs.
Companies and brands will likely offer collections of small coffrets of their scents to
help keep consumers loyal to their company and/or brand, while still satisfying
consumersneedforvariety.
Fragrances will likely multitask by providing some additional advantages beyond just
impartingascent,possiblyahealthbenefit,suchashelpingtolowerbloodpressure,
improvingsinuscongestion,oroverallrelaxation.
Consumers will still be interested in value during the forecast period and fragrances
needtocommunicatetheirvalue,whichgoesbeyondprice.
Fragranceswilllikelyremainchallengedasadesiredgiftofchoice.
4C49
4C50
FragrancesforWomen
Reaching the consumer and grabbing their attention will require the use of a
comprehensivemarketingapproach.
Innovative print and broadcast advertising, possibly with the use of celebrities or a
brandspokespersonwillremainthecoreeffortutilizedbybrands.
YouTube videos of the broadcast advertisements, along with additional videos that
helpchannelthespiritoftheproductwillbeincludedonthebrandswebsite.
Cooperative advertising with retailers in newspapers, magazines, and in department
stores and specialty stores brochures are expected to continue during the forecast
period.
Samplingeffortswillcontinuetobeofextremeimportanceandcouldeventakenew
forms,suchasaflashdrivethatemitsascent.
Consumers will likely check out reviews, blogs, and social media before purchasing a
new scent, and brands will need to plan for blogger outreach and social media
engagement.
Specialty and department stores are forecast to remain the leading channels for the
purchaseoffragrances.
Ecommercewillincreaseinpopularityforthereplenishmentoffragrancesandalsofor
giftgiving.
Toolsandapplicationsprovidedbymarketersandretailersareexpectedtomakethe
sellingoffragranceseasier.
Sales are projected to increase at a CAGR of 3.5% to $3,231million by 2017 from

Table4C21:ForecastManufacturersSalesofFragrancesforWomenin
theUnitedStatesbyProductType,2012and2017
$Million
Producttype
2012
Liquidproducts
Ancillaryproducts
Total
2017
CAGR,%
2,456
2,917
3.5
261
314
3.8
2,717
3,231
3.5
UnitvolumeisforecasttoincreaseataCAGRof2.0%to177millionpackagesin2017,from
160millionpackagesin2012.
4A50
4D.HAIRCAREPRODUCTS
INTRODUCTION
Included in the hair care market are products used for cleansing, conditioning, styling,
coloring,andgroominghair.
Productcategoriesincludedareasfollows:
Conditioners
Shampoos
Hairpermingproductsarenolongerincludedinthisreport.
MANUFACTURERSSALES
Manufacturers sales of hair care products are $7,610million in 2012, up 2.9% from
Shampoos is the largest category in the product class, accounting for 34.4% share of the
totalhaircaresales.
Salesoftheshampooscategorytotal$2,620millionin2012.
Hairstylingproducts,thesecondlargestcategory,accountsfor22.1%ofthetotalhaircare
class.
Salesforthecategoryare$1,680millionin2012.
Conditioners, with sales at $1,653million in 2012, is the thirdlargest category in the

productclass,constituting21.7%ofthetotalproductclasssales.
Sales of hair care products have advanced at a compound annual growth rate (CAGR) of
1.2%between2007and2012.
4D2
HairCareProducts
Table4D1:ManufacturersSalesofHairCareProductsinthe
UnitedStates,2007to2012
Year
$Million
Change,%
2007r
7,178
2008r
7,159
(0.3)
2009r
6,976
(2.6)
2010r
7,144
2.4
2011r
7,393
3.5
2012
7,610
2.9
rRestated.
Figure4D1:ManufacturersSalesofHairCareProductsintheUnitedStates,2012
Ethnichaircare
products,4%
Shampoos,34%
Haircoloring
products,17%
Hairstylingproducts
andsprays,22%
Conditioners,22%
Total:$7,610Million
NOTE:Totalsmaynotaddduetorounding.
RETAILSALES
In 2012, retail sales of hair care products total $10,959million, up 3.1% from
Salesbytradeclass
Masscontinuestobethelargesttradeclass,representing80.3%oftotalhaircaresalesin
2012.
Professional brands follow in a distant second place with 16.1% of sales, while the
directsalestradeclassrepresents2.6%sharefortheyear.
Specialty and luxury trade classes account for 0.6% and 0.4% of total hair care sales,
respectively,in2012.
4A2
4D3
HairCareProducts
Table4D2:ManufacturersSalesofHairCareProductsintheUnitedStatesbyTradeClass,2012
$Million
Hair
styling
Conditioners
Hair
coloring
Ethnic
haircare
Total
%Of
total
2,077
1,138
1,236
1,317
340
6,108
80.3
Professional
369
503
356
1,228
16.1
Direct
132
28
37
197
2.6
Specialty
27
16
49
0.6
Luxury
15
28
0.4
2,620
1,680
1,653
1,317
340
7,610
100.0
Tradeclass
Mass
Total
Shampoos
COMPETITION
Thethreeleadingmarketers,Procter&Gamble,LOral,andUnilever,accountfor58.2%of
theproductclass.
Table4D3:ManufacturersSalesofHairCareProductsintheUnitedStatesbyCategoryandCompany,2012
$Million
Company
Shampoos
Hair
styling
Conditioners
Hair
coloring
Ethnichair
care
Total
%Of
total
Procter&Gamble
736
222
327
308
19
1,612
21.2
LOral
287
227
253
646
95
1,508
19.8
Unilever
546
364
362
39
1,311
17.2
39
77
41
38
195
2.6
113
57
171
2.2
EsteLauder
56
65
49
170
2.2
GuthyRenker
112
26
31
169
2.2
57
56
43
156
2.0
152
152
2.0
674
643
490
173
186
2,166
28.5
2,620
1,680
1,653
1,317
340
7,610
100.0
Kao
Johnson&Johnson
JohnPaulMitchell
Systems
Revlon
Allother
Total
4D4
HairCareProducts
Procter&Gambleisthelargesthaircaremarketer,withsalesof$1,612million,accounting
for21.2%oftotalhaircaresalesin2012.
Sales of the marketer decline 0.8% from $1,625million in 2011 to $1,612million in
2012.
Procter&Gamblehasitspresenceinallhaircarecategories.
Limitednewproductactivity,adecreaseinthemarketingandadvertisingsupportfor
itsbrands,andadecreaseincouponingactivitycontributetothemarketersdeclinein
theoverallhaircareproductclassin2012.
Procter&GambledecreasesitsTMEsignificantlyby21.7%,from$301.3millionin2011
to$236.0millionin2012.
The company is the leading marketer in the shampoos category and is the second
leading marketer in the conditioners and hair coloring categories. It has a share of
28.1%oftheoverallsalesoftheshampooscategory.Salesforthecompanygrow3.4%
from$712millionin2011to$736millionin2012.Thecompanymarketsninebrandsin
the shampoos category, including the top two brands, Pantene ProV and Head &
Shoulders,andthefifthlargestbrand,HerbalEssences.
Head & Shoulders becomes the leader in the shampoos category in 2012, displacing
Pantene ProV. Head & Shoulders sales grow 9.0%, from $244 million in 2011 to
$266million in 2012. The brands growth is driven by improved marketing and
promotionalactivitiesinthecategory.Procter&Gamblelaunchesvariouscampaignsto
supportthesalesofthebrandinthecategory.ThemarketersignssoccerplayerLionel
Messi as its spokesperson to promote its Head & Shoulders brand. New product
launches and the success of natural products support the growth of Herbal Essences
brandintheshampooscategoryin2012.
Procter & Gamble is the secondleading marketer in the conditioners category,
constituting 19.8% of the total category sales. Sales for the company grow 0.9%, up
from$324millionin2011to$327millionin2012.PanteneProVmaintainsitsposition
asthetopbrandintheconditionerscategorywithacategoryshareof13.3%.Salesfor
thebranddecline1.2%from$167millionin2011to$165millionin2012.Limitednew
productactivityandpromotionalactivitiescontributetothebrandssalesdeclineinthe
conditionerscategoryin2012.HerbalEssencesisthesecondlargestbrandforProcter
&Gambleintheconditionerscategory,withsalesat$98millionin2012.
Procter&Gambleisthesecondleadingmarketerinthehaircoloringproductscategory,
withsalesat$308millionin2012,down9.7%from$341millionin2011.Themarketer
discontinues several brands in 2011, such as Clairol Hydrience, Clairol Men's Choice,
andClairolUltress,contributingtothesalesdeclinein2012.
Procter & Gamble is the third leading marketer in the hair styling products category,
withsalesdecreasing2.2%to$222millionin2012from$227millionin2011.Limited
newproductactivityandadecreaseinmarketingandpromotionalactivitycontributes
tothemarketersdeclineinthehairstylingproductscategory.
4A4
HairCareProducts
LOral, with a share of 19.8% in the product class, is the secondlargest marketer in hair
care.
Sales for the company are down slightly by 0.1% from $1,509million in 2011 to
LOral is the leading marketer in the hair coloring products and ethnic hair care
productscategories.
In hair coloring products, LOral accounts for an estimated 49.1% of the categorys
sales in 2012. Sales decline 0.3% from $648million in 2011 to $646million in 2012.
LOrals product offering in hair coloring mainly comprises permanent hair colors.
LOral Preference, L'Oral Excellence, and Garnier Nutrisse are the three leading
brands,and2012marksthelaunchofafewdistincthaircolorlines,includingGarnier
Olia.
AlthoughtheshareofLOralintheoverallethnichaircareproductscategorydeclines
from 29.1% in 2011 to 27.9% in 2012, the company maintains its reigning position in
the category. Sales of the company decline by2.1%, from $97 million in 2011 to $95
millionin2012.In2012,LorealintroducesDarkandLovelyAuNaturaleantibreakage
maintenanceandstylingline,alongwithafewotherproductintroductionstooffsetits
salesdecline.
LOral maintains its position as the secondleading marketer in the hair styling
products category, with a share of 13.5% of the category sales, down from 13.8% in
2011.Salesforthemarketerdecline0.9%from$229millionin2011to$227millionin
2012. The decrease in marketing and promotional activities contributes to the sales
declineforLOralinthehairstylingproductscategoryin2012.
LOraldecreasesitsTMEspendbyapproximately20.3%,from$60.5millionin2011to
$48.2millionin2012.
GarnierFructisistheleadinghairstylingbrandofthecompany,andthesecondlargest
inthecategory.Itssalesare$88millionin2012,down2.4%from$84millionin2011.
LOralistheleadingmarketerintheprofessionaltradeclass,withRedkentheleading
brand,followedbyMatrixinthirdposition.
Themarketeroccupies21.8%oftheprofessionaltradeclass,upfrom21.2%in2011.
LOralisthethirdlargestmarketerintheshampooscategorywitha10.9%share;the
companys sales grow 0.7% from $284 million in 2011 to $286 million in 2012. The
company offers 10 brands in the shampoos category. Garnier Fructis is the leading
brandfromLOral,andsalesdecline1.4%,from$136millionin2011to$134millionin
2012.Limitednewproductactivityoffsetsthebrandsgrowthinthecategory.
LOralisalsoplacedthirdintheconditionerscategorywithashareof15.3%.Salesfor
themarketergrow1.2%from$250millionin2011to$253millionin2012.Thelargest
brandfromLOralisGarnierFructis,whichhasashareof7.0%ofthetotalcategory
sales.
4D5
4D6
HairCareProducts
Unileveristhethirdlargestmarketerofhaircareproducts,withtotalsalesat$1,311million
in2012,up4.3%from$1,257millionin2011.
The marketers sales growth is primarily supported by its significant launch of Clear
shampoos and conditioners in 2012, including a range focused on scalp therapy and
totalrepair.
Themarketerhasapresenceinfourofthefivehaircarecategories,withtheexception
ofthehaircoloringproductscategory.
Unilever,thesecondrankedmarketerintheshampooscategory,hasacategoryshare
of20.8%.Thecompanyssalesgrow4.4%from$523millionin2011to$546millionin
2012. Suave continues to be the leading brand of Unilever and is the thirdlargest
brand in the category. Sales of the brand are up 3.8%, from $186 million in 2011 to
$193million in 2012. New product activity and increased marketing contribute to
Suavesperformanceinthecategory.
In the conditioners category, sales for the marketer grow 7.7% from $336 million in
2011 to $362 million in 2012. Unilever primarily benefits with the launch of a new
brand,Clearconditionersin2012.TheClearbrandhassalesof$27millionin2012,as
thebrandbenefitsfromitsscalptherapyrangeofconditioners.Thelargestbrandfrom
Unilever is Suave, which has a category share of 6.5% in 2012. Sales for Suave grow
4.9% from $103million in 2011 to $108 million in 2012. New product launches and
economicallypricedproductscontributetoSuavesgrowth.
Unilever continues to be the leading marketer in the hair styling products and
conditionerscategoryin2012.SalesforUnilevergrow1.4%from$359millionin2011
to$364millionin2012inthehairstylingproductscategory.TRESemmistheleading
brandofthecompany,withsalesat$124millionin2012,up7.8%from$115millionin
2011. Thegrowthofthebrandissupportedbyseveralnewproductintroductionsby
Unileverin2012.
Unileveristhesecondleadingmarketerintheethnichaircareproductscategorywith
ashareof11.5%in2012.Salesforthecompanyremainflatat$39millionin2012,the
same as 2011. Lack of technological advancements and limited new product activity
account for stagnant sales for Unilever in 2012. Limited distribution channels, with
beauty supply stores accounting for the majority, offset the growth of the marketer.
Soft & Beautiful is the leading brand for Unilever, accounting for 4.1% of the total
categorysalesin2012,downfrom4.5%in2011.Thebrandssalesdecline$1million
from$15millionin2011to$14millionin2012.Soft&Beautifulhasapresenceinthe
relaxerkitsandstylingaidssegments.
RETAILDISTRIBUTION
Massmerchandisers,themostpreferredchannelofretaildistribution,accountsfor39.4%
shareofthehaircaremarketin2012.
Drug stores and food stores follow with market shares of 20.9% and 19.8%,
respectively.
4A6
HairCareProducts
Table4D4:RetailDistributionofHairCareProductsintheUnitedStates,2012
Shampoos
Hair
styling
Conditioners
Hair
coloring
Ethnichair
care
Massmerchandisers
41
36
39
39
27
39.4
Drugstores
13
19
18
39
20
20.9
Foodstores
23
18
20
18
19.8
Salons
11
22
16
12.2
Specialtystoresa
45
5.4
Direct
1.9
Departmentstores
0.3
Total
100
aIncludesbeautysupplystores.
100
100
100
100
100.0
Retailoutlet
Weighted
average
OUTLOOK
Sales of hair care products are projected to grow at a moderate rate of 2.1% during the
forecastperiodfrom2012to2017.
Shampoos and conditioners are expected to drive the sales of the hair care product
Haircareproductswithimprovedformulationsandinnovativepackagingareexpected
tosupportthegrowthoftheproductclass.
Shampoos, the largest category in the hair care product class, is expected to experience
steady growth of 3.1% over the forecast period despite its relatively mature stage in the
UnitedStates.
Shampoosthatprotectthescalpshealthandenhanceshineareexpectedtoperform
wellinthefuture.
Shampoosthatcatertospecifichairproblemsandhairtypesareexpectedtosupport
thecategoryssales.
Marketers will constantly incorporate additional hair care benefits, such as frizz
protectionandcolorprotectionintotheirproducts.
Naturalshampoosornaturallypositionedshampoosthatwillnotcausedamagetothe
hairarelikelytohavegooddemandinthefuture.
Mens shampoos will continue to grow over the forecast period, supported by new
productlaunchesandanincreasingdemandforsuchproducts.
Marketersconsiderthissegmenttohaveahugepotential,andasaresult,companies
such as Unilever and Procter & Gamble are including mens care products in their
prioritylists.
Aggressive and innovative product promotions are expected to be among the key
driversforthecategorysgrowth.
4D7
4D8
HairCareProducts
Hair styling products and sprays, the second largest category in hair care, is expected to
growmoderatelyby1.4%overthenextfiveyears.
Manufacturers will continue to introduce hair styling products with multibenefits to
supportthecategorygrowthovertheforecastperiod.
Hairstylingproductsthatoffermultibenefitsforcoloredandtreatedhairarelikelyto
dowellduringtheforecastperiod.
Hairstylingproductsthatwillprotecthairscalpshealthareexpectedtoperformbetter.
Marketersareexpectedtointroduceproductstargetedtomen,asthemenssegment
isexpectedtoperformwellovertheforecastperiod.
Sales of professional hair styling products are expected to grow moderately over the
forecastperiod.
Sales of conditioners are expected post steady growth of 2.5% over the forecast period,
2012to2017.
New product activity and considerable promotional and marketing activities are
expectedtobetheprimegrowthdriversforthesalesgrowthofthecategory.
The continuous growth in the aging population will likely drive the need for
conditionersasthemoistureandshineinhairdeclineswithage.
Research and development efforts from the leading marketers will result in the
introductionofnewandinnovativeproductsinthecategory.
The majority of marketers are expected to launch innovative products that cater to
specifichairproblemsincludingthinningandvolumeboostthatwillperformwellover
theforecastperiod.
Conditionersthatofferextrabenefits,suchassunandscalpprotection,areexpected
toperformwell.
Colorprotectingandcolorenhancingconditionersareprojectedtogrowatahealthy
rateduringtheforecastperiod.
Thegrowingnumberofconsumerswhocolortheirhairareexpectedcontributetothe
growthofcolorprotectionconditioners.
Productsformulatedwithnaturalingredientsarelikelytoemergeasagrowingniche
4A8
HairCareProducts
Thehaircoloringcategoryisexpectedtoexperienceamoderategrowthof0.4%overthe
forecastperiod.
Agingconsumerswillcontinuetolookforcoloringproductsthathavethemainbenefit
ofcoveringgrayhair.
The aging population or consumers in the 35 to 65 age group will be the leading
consumer segment for the category and are likely to drive the sales growth of
permanenthaircolorproducts.
Permanenthaircolorswillcontinuetobetheleadingsegmentinthecategory,asthey
arethemostsuitableproductstocompletegraycoverage.
Youngconsumerswhoconsiderhaircolorasafashionstatementwillalsocontinueto
supportthecategorygrowth.
Productswithimprovedformulationssuchasfoambasedandcreambasedhaircolors
willcontinuetogainpopularityovertheforecastperiod.
Ongoing active research and development activities will result in improvements in
productquality.
Hair coloring products are expected to incorporate a number of additional benefits,
includingthenourishmentofhairandprotectionfromthesun.
Themenshaircoloringsegmentwillcontinuetoshowgrowthovertheforecastperiod,
supportedbynewproductlaunchesandinnovationsinthecategory.
The ethnic hair care category is estimated grow moderately by 1.8% over the forecast
period.
TheethnicpopulationisprojectedtogrowfasterthantheoverallAmericanpopulation
supportingtheoverallcategorygrowth.
Products that cater to specific hair concerns such as curl control, protection against
breakage,andvarioushairtypesareexpectedtoperformwellovertheforecastperiod.
Ethnichaircareproductsthatarepositionedasnaturalorcontainnaturalingredients
areexpectedtogrowsignificantlyovertheforecastperiod.
Consumersarelikelytocontinueseekproductsthatcontainnaturalingredients,such
astiareflower(softens,purifyiesandsoothes)andfloralextracts.
Relaxerkitsareexpectedtoleadthecategoryshareovertheforecastperiod.
Consistent with trends in the general market, African American men are increasingly
focusedongrooming.
However,thecategoryisexpectedtofacecompetitionfromgeneralhaircarebrands
thathavehaircolorsandhairstylingproductwhichareattractivetoethnicconsumers,
especiallyamongtheyoungerpopulation.
Sales of the hair care products class are forecast to grow at a CAGR of 2.1% to reach
$8,438millionin2017from$7,610millionin2012.
4D9
4D10
HairCareProducts
Table4D5:ForecastManufacturersSalesofHairCareProductsintheUnitedStatesby
$Million
Category
2012
2017
CAGR,%
Shampoos
2,620
3,050
3.1
1,680
1,802
1.4
Conditioners
1,653
1,870
2.5
1,317
1,345
0.4
340
371
1.8
7,610
8,438
2.1
Total
UnitsalesareforecasttoincreaseataCAGRof1.5%from2,037millionpackagesin2012to
2,197millionpackagesin2017.
Table4D6:ForecastUnitSalesofHairCareProductsintheUnitedStatesbyCategory,
2012and2017
Millionpackages
Category
2012
2017
CAGR,%
Shampoos
741
826
2.2
529
555
1.0
Conditioners
443
480
1.6
225
230
0.4
99
106
1.4
2,037
2,197
1.5
Total
4A10
CONDITIONERS
CATEGORYPERFORMANCE
Manufacturerssales
In 2012, manufacturers sales of conditioners grow 4.8% to reach $1,653million, up from

The category has grown at a compound annual growth rate (CAGR) of 1.2% between
2007and2012.
Table4D7:HistoricalSalesofConditionersintheUnited
States,2007to2012
Year
$Millionr
Change,%
2007
1,561
2008
1,561
2009
1,497
(4.1)
2010
1,525
1.9
2011
1,578
3.5
2012
1,653
4.8
rRestated.
Unitsales
Unit sales in the category grow marginally by 3.7% from 427million packages in 2011 to
Retailsales
Retailsalesofconditionerstotal$2,470.7millionin2012,up4.8%from$2,356.7millionin
2011.
4D12
Conditioners
Table4D8:ManufacturersSalesofConditionersintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
%Oftradeclass
%Oftotal
Company
2011
2012
2011
2012
2011
2012
PanteneProVr
Procter&Gamble
167
165
14.1
13.3
10.6
10.0
GarnierFructisr
L'Oral
116
115
9.8
9.3
7.4
7.0
Suave
Unilever
103
108
8.7
8.7
6.5
6.5
TRESemmr
Unilever
109
107
9.2
8.7
6.9
6.5
HerbalEssencesr
Procter&Gamble
96
98
8.1
7.9
6.1
5.9
Dove
Unilever
68
66
5.7
5.3
4.3
4.0
Aussie
Procter&Gamble
45
48
3.8
3.9
2.9
2.9
Organixr
VogueInternational
24
38
2.0
3.1
1.5
2.3
Nexxus
Unilever
36
37
3.0
3.0
2.3
2.2
Neutrogena
Johnson&Johnson
31
32
2.6
2.6
2.0
1.9
AlbertoVO5r
BrynwoodPartners
28
29
2.4
2.3
1.8
1.8
Clear
Unilever
27
2.2
EverPurer
L'Oral
17
18
1.4
1.5
1.1
1.1
Aveenor
Johnson&Johnson
15
16
1.3
1.3
1.0
1.0
BrilliantBrunette
Kao
15
15
1.3
1.2
1.0
0.9
Infusium23
HelenofTroy
17
14
1.4
1.1
1.1
0.8
Finesse
Lornamead
13
12
1.1
1.0
0.8
0.7
VivePror
L'Oral
14
11
1.2
0.9
0.9
0.7
Johnson's
Johnson&Johnson
0.8
0.7
0.6
0.5
Fekkai
Procter&Gamble
0.7
0.7
0.5
0.5
EverSleek
L'Oral
0.7
0.6
0.5
0.5
EverStrong
L'Oral
0.7
0.6
0.5
0.4
WhiteRain
BrynwoodPartners
0.5
0.4
0.4
0.3
EverCreme
L'Oral
0.4
0.3
Burt'sBees
TheCloroxCompany
0.3
0.3
0.2
0.2
RadiantRedr
Kao
0.3
0.2
0.2
0.2
Freeman
FreemanBeauty
0.3
0.2
0.2
0.1
Jhirmack
InspiredBeauty
Brands
0.2
0.2
0.1
0.1
L'OralKids
L'Oral
0.2
0.2
0.1
0.1
Got2B
Henkel
0.2
0.2
0.1
0.1
Condition
HelenofTroy
0.1
0.1
0.1
0.1
Sunsilka
Unilever
0.3
0.2
43
41
3.6
3.3
2.7
2.5
MASS
Privatelabel
(Continued)
4A12
1.6
4D13
Conditioners
Table4D8:ManufacturersSalesofConditionersintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
%Oftradeclass
%Oftotal
Company
2011
2012
2011
2012
2011
2012
Allother
Allother
148
156
12.5
12.6
9.4
9.4
Allother
KaoUSA
23
23
1.9
1.9
1.5
1.4
Allother
Henkel
0.1
0.1
0.1
0.1
1,187
1,236
100.0
100.0
75.2
74.8
MASS(Continued)
Total
PROFESSIONAL
Matrix
L'Oral
43
44
12.3
12.4
2.7
2.7
PaulMitchell
JohnPaulMitchell
Systems
42
43
12.0
12.1
2.7
2.6
Aveda
EsteLauder
32
33
9.2
9.3
2.0
2.0
Redken
L'Oral
29
30
8.3
8.4
1.8
1.8
Nioxin
NioxinResearch
Laboratories
27
30
7.7
8.4
1.7
1.8
TIGI
Unilever
17
17
4.9
4.8
1.1
1.0
BumbleandBumble
EsteLauder
13
14
3.7
3.9
0.8
0.8
Pureology
L'Oral
13
13
3.7
3.7
0.8
0.8
Joico
Shiseido
10
11
2.9
3.1
0.6
0.7
Alterna
TSGConsumer
Partners
2.0
2.2
0.4
0.5
Sebastian
Procter&Gamble
2.3
2.0
0.5
0.4
108
106
30.9
29.8
6.8
6.4
349
356
100.0
100.0
22.1
21.5
15
31
78.9
83.8
1.0
1.9
10.5
5.4
0.1
0.1
10.5
10.8
0.1
0.2
19
37
100.0
100.0
1.2
2.2
25.0
25.0
0.1
0.1
75.0
75.0
0.4
0.4
100.0
100.0
0.5
0.5
Allother
Total
DIRECT
Wen
GuthyRenker
Avon
Avon
Allother
Total
LUXURY
Origins
EsteLauder
Allother
Total
SPECIALITY
Victoria'sSecret
LimitedBrands
33.3
31.3
0.3
0.3
Bath&BodyWorks
LimitedBrands
20.0
18.8
0.2
0.2
Crabtree&Evelyn
Crabtree&Evelyn
6.7
6.3
0.1
0.1
40.0
43.8
0.4
0.4
15
16
100.0
100.0
1.0
1.0
1,578
1,653
100.0
100.0
Allother
Total
TOTAL
aDiscontinued.
rRestated.
4D14
Conditioners
CATEGORYDEVELOPMENT
Markettrends
Salesofconditionersgrowby4.8%in2012.
Theconditionersmarketcontinuestofollowtheshampoosmarketcloselyintermsof
markettrendsandcharacteristics.
Thebranding,positioning,anddistributionofconditionerstendtobethesameasthe
correspondingshampoobrands.
However,conditionersoftenfollowshampoos,andareslightlybehindshampooswhen
itcomestomarketpenetration.
Conditionersmarginallylagbehindshampoosintermsofmarketpenetrationandreach.
Conditionerswithimprovedformulationssupportthecategorysgrowthin2012.
Conditioners that offer extra benefits apart from moisturization perform well in the
category.
Alongwithmoisturizingthehair,consumersexpectconditionerstoofferotherbenefits,
suchasaddingvolume,enhancingshine,andprotectingcolor.
In 2012, John Paul Mitchell Systems introduces Full Circle leavein treatment that
claimstodetangle,cleanse,andtamefrizzallatonce.
Most of the larger brands in the category offer specialized products as per the
consumershairconcerns.
Leading brands, such as Pantene, Suave, and Garnier have separate product lines for
colorprotection,controllingfrizz,volumizing,andstrengthening.
The socalled cleansing conditioners are reported in the shampoos category, since
theyreplaceshampoos.
Menspecificconditionerscontinuetoperformwellin2012.
Several leading marketers including Unilever and Procter & Gamble launch men
specificconditionersin2012.
Unilever launches a new line of Clear Men range of conditioners in 2012 and also
extendsitsSuaveforMenandAxelineofconditionerswithnewvariants.
Procter & Gamble also extends its Head & Shoulders line of conditioners with new
variantstargetedatmen.
Product customization continues to be an important product trend among hair care

products.
Conditionersthatcatertotheneedsofvarioushairconcerns,suchasthinning,volume
boost,andhairtypescontinuetoperformwellin2012.
Marketers also launch conditioners for specific hair types to support the categorys
growth.
In2012,Procter&GamblelaunchesPanteneProVDailyMoistureRenewalconditioner
suitableforboththickandmediumhair.
In 2012, L'Oral launches Garnier Fructis Triple Nutrition Cream conditioner that is
suitablefordryanddamagedhair.
4A14
Conditioners
Several leading marketers including Unilever and Procter & Gamble launch new range of
conditionerssupportingtheoverallgrowthofthecategory.
Unilever introduces its new Clear range of conditioners in early 2012. The range
includesscalptherapyandtotalcareconditioners.
L'Oral launches a new range of EverCreme shampoos and conditioners in 2012,
supportingthecategorysgrowth.
Conditionerswithmultiplebenefitsperformwellinthecategory.
Conditioners that offer extra benefits, such as protection from hair color, frizz
protectionsupportthecategorysgrowth.
ThesuccessofLOralsEverSleekandEverCreme,sulfatefreerangeofconditionersin
2012,willpromptothermarketerstolaunchsimilarproducts.
In 2012, Kao launches Color Care range of conditioners that claims to protect color
underitsGoldwellbrand.
Natural formulations have become a norm in the category, with most marketers either
introducing a complete new range of naturallypositioned products or reformulating their
existinglinestoincludenaturalingredients.
Many leading marketers, such as Vogue International and Procter & Gamble launch
productswithmorenaturalingredientsin2012.
Naturallypositioned brands, such as Organix, perform well in 2012; the sales of
Organixgrowby58.3%,from$24millionin2011to$38millionin2012.
In 2012, Vogue International launches Organix Shea Butter and Argan Oil conditioner
andOrganixAustralianTeatreeConditioner.
Procter & Gamble launches Herbal Essences Long Term Relationship natural
conditionerin2012.
However, most of these products contain a mix of some natural with primarily
syntheticingredients.
Theprofessionalconditionerscategoryexperiencesmoderategrowthof2.0%in2012.
Consumers in the United States increase their salon visits in 2012, supporting the
categorysgrowth.
4D15
4D16
Conditioners
Notablenewproducts
Table4D9:SelectNewConditionersIntroducedintheUnitedStatesin2012
Company
Brand
Description
Aesop
BlackLabel
Volumizingconditionercontainsbothblendedbotanicaloilsandvegetable
andsyntheticproteins
AloxxiInternational
Aloxxi
ColorCareVolumizingandStrengtheningconditionerprovidesvolume,
strength,andcolorprotectionthroughitsspecialAppleCellStem
Technology
EsteLauder
BumbleandBumble
ColorMindedconditionerisinfusedwithdualpolymertechnologythatis
designedtomakehairimpermeabletowater,reducingbothcolorwashout
andfading
HainCelestialGroup
QueenHelene
SilkyTwirlsconditionercontains17aminoacids,plusvitaminsA,B,C,Dand
K,thepresenceofwhich,deliverssmoothinghydrationtothecurlsand
twirls
JohnPaulMitchell
Systems
PaulMitchell
FullCircleleaveintreatmentisdesignedtodetangle,cleanse,andtame
frizzallatonce
Johnson&Johnson
Aveeno
PureRenewalconditionerrefresheshairwithoutwaterforaclean,healthy
lookbetweenwashes
Johnson&Johnson
Neutrogena
CleanReplenishingconditionergentlycleansesanditsmoistureenriched
formulapenetratesdrydamagedstrandstomakehairmoreresilient
Johnson&Johnson
Neutrogena
TripleMoistureDailyDeepconditionercontainsnaturallyderivedextracts
thatpenetrateandmoisturizehairstrand,therebyprovidingsmoothness
andsoftness
Johnson&Johnson
Neutrogena
TripleRenewalWeightlessconditionerisinfusedwithablendofamino
acids,vitamins,andnaturallyderivedproteins
Johnson&Johnson
Neutrogena
CleanVolumeconditionergentlycleansesandaddsbodytoflatlifelesshair,
leavingnobuildup
Kao
Goldwell
ExtraRichconditioner,withitsuniqueformulawithpomegranateessence
providesminimalcolorfading
LOral
EverCreme
Nourishingconditionerinfusedwithomega3and6thathelpsrestore
moisture;containsnaturalbotanicalsandisfreefromparabens
LOral
GarnierFructis
TripleNutritionconditionerfortifiesandinfusesnutrientsforsilkyhair,full
oflife
LOral
GarnierFructis
PureCleanFortifyingconditionerbooststhehealthofhairandscalp,andis
thefirstbiodegradableformulafromFructis
LOral
LOralParis
AdvancedHairCareTotalRepair5Restoringconditionerhelpsrepairfive
visiblesignsofdamagedhair:splitends,weakness,roughness,dullness,and
dehydration
LOral
LOralParis
TripleResistReinforcingconditionerinstantlyhelpsnourishhairfromroot
tocoretotip,therebystrengtheninghair
LOral
LOralParis
SmoothIntensepolishingconditionersoftenshairinstantlyandcombats
symptomsofroughtextures,leavinghairsmooth
LOral
Matrix
BlondeCareconditionercontainsanexoticblendofchamomileand
panthenolthatcleansesanddetangleshairforanenhancedbrilliantshine,
withoutaddingweighttothehair
(Continued)
4A16
Conditioners
Table4D9:SelectNewConditionersIntroducedintheUnitedStatesin2012
Company
Brand
Description
Procter&Gamble
Head&Shoulders
DamageRescueconditionernourishesdamagedhairandrelievesdryscalp
bylockinginmoisturetherebymaintainingahealthymoisturebarrier
Procter&Gamble
PanteneProV
ProVBeautifulLengthsconditionerfortifieshairagainstdamagethatleads
tobreakage,therebyincreasingthelengthofeachhairstrand
Procter&Gamble
PanteneProV
ProVMoistureRenewalconditionerisspeciallyformulatedtonurturethe
hairslipidlayerensuringmaximummoistureretentioninanaturaland
healthyway
Procter&Gamble
PanteneProV
PanteneAdvancedandKeratinRepairconditionerfeaturesadvanced
technologytohelprestoresmoothnesstoextremelydamagedhair,while
preventingfurtherdamage
Unilever
Axe
Apollo2in1shampooandconditionercombinescrispfruitandacreamy
background,therebyrenderingauniquemasculinefragrancetohair
Unilever
Clear
TotalCareNourishingDailyconditioner,withitsadvancedcomplexof
vitaminsandnutrientsgentlycleansesandhelpsrestorethescalpsnatural
moisturebalance
Unilever
Clear
Damage&ColorRepairDailyNourishingconditioner,cleansesgentlyand
hasadvancedcolorsafeformulathatprovidesprotectionfromdaily
damage
Unilever
Clear
VolumizingRootBoostconditionerprovidesspecialnourishingandallday
volumefromroottotip
Unilever
Clear
StrongLengthsDailyConditionercontainsarichstrengtheningserumto
nurtureandprotecthairfrombreakage
Unilever
Clear
MoisturizingDryScalpconditionercontainsanextrarichformulathat
nourishesdryscalpandhairtorestorenaturalmoisturebalance
Unilever
Clear
FrizzControlconditionerhasagentlenourishingformulainfusedwitha
smoothingcomplex,provides24hourfrizzcontrol
Unilever
Clear
UltraSheaconditionercontainsaformulainfusedwithNutritium10TM
MoistureLock,sheabutter,andnaturaloilsthatquenchesdrynessand
locksinmoisture
Unilever
Nexxus
FrizzDefyconditionercontainsMoroccanarganoilandcoconutextract,
thathelpcreatesmoothstylesandcontrolfrizzallday
Unilever
TRESemm
SplitRemedyconditionerconditionsandmoisturizeshairstrandwhile
bindingupto80%ofsplitends
Unilever
Suave
DailyclarifyingconditionerisapHbalancedconditioner,thatlightly
nourisheshairaftershampoo,andissuitableforbothnormalaswellasoily
hair
VogueInternational
Organix
KeratinOilconditioner,fightssplitendsandstrengthensandrestoreshair
beauty
VogueInternational
Organix
CitrusMintconditionerthickensandtexturizeshairwhilestimulatingscalp
withfreshnessofcitrusextracts
VogueInternational
Organix
MoroccanArganOilconditionerisfreefromsulfatesandparabens,andisa
blendofMoroccanarganoil,vitaminE,andantioxidants
4D17
4D18
Conditioners
M&Aactivity
In 2012, Brynwood Partners acquires the brand White Rain from Sun Products for an
undisclosedamount.
WhiteRainissoldinthetopthreecategoriesofthehaircareproductclass:shampoos,
conditioners,andhairstylingproducts.
ThisdealisexpectedtostrengthenthepositionofBrynwoodPartnersinthehaircare
productclass.
Salesbytradeclass
The mass trade class continues to be the leading retail channel in 2012, accounting for
74.8%ofthecategorysalesin2012.
Productsinthespecialtyandluxurytradeclassesremainflatduringtheyear.
Table4D10:ManufacturersSalesofConditionersintheUnitedStatesbyTradeClass,2011and2012
Tradeclass
%Oftotal
2012
2011
2012
1,187
1,236
75.2
74.8
4.1
349
356
22.1
21.5
2.0
Direct
19
37
1.2
2.2
94.7
Specialty
15
16
1.0
1.0
6.7
0.5
0.5
1,578
1,653
100.0
100.0
4.8
Professional
Luxury
Total
4A18
2011
Mass
$Million
Change,%
Conditioners
COMPETITION
Bycompany
Table4D11:ManufacturersSalesofConditionersintheUnitedStatesbyCompany,2011and2012
$Million
%Oftotal
Company
2011
2012
2011
2012
Change,%
Unilever
336
362
21.3
21.9
7.7
Procter&Gamble
324
327
20.5
19.8
0.9
LOral
250
253
15.8
15.3
1.2
Johnson&Johnson
55
57
3.5
3.4
3.6
EsteLauder
47
49
3.0
3.0
4.3
JohnPaulMitchellSystems
42
43
2.7
2.6
2.4
Kao
41
41
2.6
2.5
VogueInternational
24
38
1.5
2.3
58.3
Privatelabel
43
41
2.7
2.5
(4.7)
416
442
26.4
26.7
6.3
1,578
1,653
100.0
100.0
4.8
Allother
Total
Unilever,theleadingmarketer,hasashareof21.9%ofthecategoryssalesin2012,slightly
upfrom21.3%in2011.
Salesforthemarketergrow7.7%from$336millionin2011to$362millionin2012.
Unileverprimarilybenefitswiththelaunchofanewbrand,Clearconditionersin2012.
Clear has sales of $27 million in 2012, as the brand benefits from its scalp therapy
rangeofconditioners.
ThelargestbrandfromUnileverisSuave,whichhasacategoryshareof6.5%in2012.
Sales for Suave grow 4.9% from $103million in 2011 to $108million in 2012. New
product launches and its economically priced products contribute to the brands
growth.
TRESemm,thesecondlargestbrandforUnilever,hasanoverallshareof6.5%in2012.
SalesofTRESemmdeclineby1.8%,from$109millionin2011to$107millionin2012.
Limitednewproductactivityoffsetsthebrandsgrowthinthecategory.
Dove,thethirdlargestbrandforUnilever,hasacategoryshareof4.0%in2012.
Salesforthebranddeclineby2.9%,from$68millionin2011to$66millionin2012.
Minimaladvertisingsupportcontributestothebrandsdeclineinthecategory.
Unilevers youthcentric brand Sunsilk is discontinued in 2012. Diminishing consumer
interestinthebrandresultsinthediscontinuationofthebrand.
The only professional brand marketed by Unilever in the category is TIGI, with the
brandssalesflatat$17million.
4D19
4D20
Conditioners
In 2012, the secondleading marketer, Procter& Gamble, has a share of 19.8% in the
categoryssales.
Salesforthecompanygrow0.9%,upfrom$324millionin2011to$327millionin2012.
PanteneProVmaintainsitspositionasthetopbrandinthecategorywithacategory
share of 10.0%. Sales for the brand decline 1.2% from $167million in 2011 to
$165millionin2012.
Limitednewproductactivity,lackofdifferentiation,andlimitedpromotionalactivities
contributetothebrandssalesdeclinein2012.
The only significant launches under the Pantene ProV brand in 2012 are Advanced
KeratinconditionerandAgeDefyconditioner.
HerbalEssences,thesecondlargestbrandforProcter&Gamble,hasacategoryshare
of5.9%in2012.
It is the fifthlargest brand in the category. Sales for the brand are up 2.1% from
$96millionin2011to$98millionin2012.
New product activity from the brand and its natural products line contribute to the
brandsgrowthinthecategory.Thecompanylaunchesarangeofnaturalconditioners
includingHoneyImStrongconditionerandLongTermRelationshipnaturalconditioner
undertheHerbalEssencesbrand.
SalesforAussiegrow6.7%from$45millionin2011to$48millionin2012.
Better promotional activities, such as instore marketing contribute to the brands
growthinthecategory.
Intheprofessionaltradeclass,Procter&Gamblehasasegmentshareof2.0%in2012;
SebastianistheonlybrandmarketedbyProcter&Gambleintheprofessionalsegment.
SalesforSebastiandeclineby$1millionto$7millionin2012.
LOralisplacedthirdinthecategorywithashareof15.3%.Salesforthemarketergrow
1.2%from$250millionin2011to$253millionin2012.
ThelargestbrandfromLOralisGarnierFructis,whichhasashareof7.0%ofthetotal
categoryssales.
Garnier Fructis is the secondlargest brand in the category. Sales for Garnier Fructis
declineby0.9%from$116millionin2011to$115millionin2012.
TheonlysignificantlaunchundertheGarnierFructisbrandisPureCleanconditioner.
EverPure,thelineofsulfatefreeconditionersintroducedin2011,continuestoperform
wellforLOralin2012.
Thebrandgrowsby5.9%from$17millionin2011to$18millionin2012.
ThesuccessofEverPureandEverSleekandthegrowingconsumerconcernaboutharsh
chemicalsusedinhaircareproductspromptsLOraltolaunchafourthlineofsulfate
freeproducts.Thenewline,EverCreme,hassalesof$5millionduringitsfirstyearof
introductionin2012.
Vive Pro, the variant under the LOral Paris umbrella, continues to witness sales
decline in 2012. Sales for the brand shrink from $14million in 2011 to $11million in
2012.
Salessufferduetolimitedpromotionalspendingandlackofnewproductactivityfrom
thebrandin2012.
4A20
Conditioners
LOralistheleadingmarketerintheprofessionaltradeclasswithashareof24.7%in2012.
The company markets the top professional conditioner brand Matrix. Sales for the
brandgrow2.3%from$43millionin2011to$44millionin2012.
SalesforRedkengrowby$1millionto$30millionin2012.Newconditionersunderthe
DiamondOilandAllSoftlineareaddedtoRedkensofferingsin2012.
The sales of the brand Pureology, offering color protection products, remain flat at
$13millionin2012.
Johnson&Johnsonisthefourthleadingmarketerinthecategory,withacategoryshareof
3.4%in2012.
Themarketersellsthreebrandsinthecategory:Neutrogena,Aveeno,andJohnson's.
The marketer launches several new products under both, Aveeno and Neutrogena
brandsthatsupportthemarketerssalesgrowthinthecategory.
Salesforthecompanygrowby3.6%from$55millionin2011to$57millionin2012.
Neutrogena,thelargestbrandforJohnson&Johnson,hasacategoryshareof1.9%in
2012.
The sales of the brand grow by $1 million from $31 million in 2011 to $32 million in
2012.
ThelaunchofNeutrogenaTGelrangeofconditionerssupportsthebrandsgrowthin
2012.
ThesalesofAveenogrowby6.7%,from$15millionin2011to$16millionin2012.
EsteLauder,withacategoryshareof3.0%,isinfifthplaceinthecategory.Thecompany
operatesintheprofessionalconditionersandluxuryconditionerssegment.
Salesforthecompanygrowfrom$47millionin2011to$49millionin2012,registering
agrowthof4.3%.
ThemarketerbenefitsfromthelaunchofAvedaInvatirangeofconditionersthatclaim
toreducehairloss.
The marketer sells two brands in the professional segment: Aveda and Bumble and
bumble.
OriginsistheonlybrandmarketedbyEsteLauderintheluxurysegment.
SalesofAvedagrowby$1millionfrom$32millionin2011to$33millionin2012.
Bumble and bumble, the other professional brand of Este Lauder, grows 7.7% from
Privatelabel
Sales of the privatelabel conditioners decline by 4.7% from $43million in 2011 to

$41millionin2012.
As the economy recovers, consumers in the United States switch back to national
brands,contributingtothesalesdeclineofprivatelabelproductsin2012.
4D21
4D22
Conditioners
RETAILDISTRIBUTION
Massmerchandiserscontinuetoleadthecategory,with39%ofthecategoryssales.
Drug stores maintain their share as the channel increases its offering of economical
pricedproductsandprivatelabelproducts.
Table4D12:ManufacturersSalesofConditionersintheUnitedStates
byRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
Massmerchandisers
40
39
Foodstores
21
20
Drugstores
18
18
Professionaloutlets
17
16
Specialtystores
Directsales
Departmentstores
100
100
Total
2012
MARKETINGACTIVITY
Marketers advertise both shampoos and conditioners together as part of their hair care
lines.
Marketing and promotional activity is the key driver for the conditioners category in
theUnitedStates.
Promotional campaigns usually include television and print advertising, along with
couponing.
Print and broadcast media advertising continue to be the primary mode for marketing
conditionerbrands.
Marketersadvertisetheirnewproductsextensivelyontelevision,innewspapers,and
inmagazines.
Fashion magazines and womens magazines, such as Allure and InStyle, are the main
avenuesforprintbasedadvertisingforconditioners.
Marketers promote the entire hair care product lines including hair styling,
conditioners,andhaircoloring.
LOraladvertisesitsEverCremebrandwiththeclaimsulfatefreemoisturesystem.
4A22
Conditioners
Marketers primarily advertise product benefits through the media to keep consumers
interestengaged.
TelevisioncommercialsforNexxusFrizzProtectionlineclaims,smoothensupto100%
ofroughnessandreduces90%frizz.
Discount coupons and pricebased promotions continue to remain the key tool for
marketers.
Discountsareofferedonnewproductstoencouragetrial.
Marketersalsousediscountsinanattempttorevivebrandsfacingasalesslowdown.
Discountsareofferedthroughcouponsdistributedviafreestandinginserts(FSIs),print
advertisements,andtheInternet.
Coupons in $1.00 and $2.00 denominations are offered by all the leading marketers
includingUnileverandProcter&Gamble.
Marketers also provide discounts and buyonegetone free promotions for brands
whosesalesaredeclininginordertokeepuptheirshare.
Marketers also provide free samples to promote the sales of their underperforming
brands.
Marketers continue to use the Internet as one of the major sources for advertising their
brands.
Social media sites, such as Facebook, Pinterest, and Twitter, are widely used by
marketersforpromotinghaircareproducts.
Newlaunchesandproductinformationisprovidedbymostofthemarketersthrough
theirrespectiveFacebookpageandthroughothersocialmediasites.
Marketers also provide discount coupons on their websites. For example, Dove and
Garnierprovidediscountcouponsontheirindividualwebsites.
Thewebsitesalsoprovidehairtipsandsuggestionsfordifferenthairproblems.
Major brands websites communicate product benefits and other unique features of
eachlineandvariant.
In 2012, traceable media expenditures (TME) specifically for conditioners total

$118.8million,upsignificantlyfrom$41.0millionin2011.
LOral has the highest media spending in the category in 2012. LOrals advertising
spendingonpromotingitsconditionersis$40.7million.
Approximately,62%or$25.4millionisspentonpromotingitsGarnierFructisline.
Unileverhasthesecondhighestmediaspendinginthecategory.Unileversadvertising
spending on promoting its conditioners is $12.6million. Approximately, 55.8% or
$7.6millionisspentonpromotingitsDovebrand.
Procter&Gamble,thesecondleadingmarketerinthecategory,spends$2.6millionin
2012,adeclineby51.9%from$5.4millionin2011.
DetailsonTMEfor2012areprovidedintheAdvertisingsectionofthisreport.
4D23
4D24
Conditioners
OUTLOOK
Salesofconditionersareexpectedtogrowsteadilyovertheforecastperiod,2012to2017.
SalesofconditionersatthemanufacturerslevelareforecasttogrowataCAGRof2.5%
New product activity and considerable promotional and marketing activities are
expectedtobetheprimegrowthdriversforthesalesgrowthofthecategory.
The continuous growth in the aging population will likely drive the need for
conditionersasthemoistureandshineinthehairdeclineswithage.
Productinnovationwillcontinuetodrivethecategoryssalesovertheforecastperiod.
Research and development efforts from the leading marketers will result in the
introductionofnewandinnovativeproducts.
Majority of the marketers are expected to launch innovative products that cater to
specifichairproblemsincludingthinningandvolumeboostthatwillperformwellover
theforecastperiod.
Conditionersthatcatertospecifichairproblemsandhairtypesareexpectedtosupport
thecategoryssales.
Conditionersthatofferextrabenefits,suchassunprotectionandscalpprotectionare
expectedtoperformwell.Marketersareexpectedtolaunchsuchproductsinorderto
increasetheirmarketshareinthecategory.
Consumersfromcertaindemographicswillcontributetothecategorysgrowth.
Thegrowingproportionofbabyboomersislikelytoresultinincreasedconsumptionof
hairconditioningproducts,sinceagingdiminishesthenaturalmoisturecontentofhair,
resultingintheneedformoisturizationthroughconditioningagents.
Products targeted at men are expected to increase, resulting in an increase in the

contributionofmaleconsumerstothecategorysgrowth.
Several leading marketers including Unilever and Procter & Gamble will continue to
launch menspecific shampoos and conditioners to support the growth of mens care
conditionersovertheforecastperiod.
Colorprotectingandcolorenhancingconditionersareprojectedtogrowatahealthyrate
Consumerswhocolortheirhairareexpectedtoincrease,contributingtothegrowthof
colorprotectionconditioners.
Technological innovations will make the conditioners more effective in protecting
coloredhairandenhancingthecoloredeffect.
4A24
Conditioners
Marketers are expected to incorporate more natural ingredients in their products, as

consumerschoosenaturallypositionedproducts.
Productsformulatedwithnaturalingredientsarelikelytoemergeasagrowingniche
Growing fears of the potential harm caused by chemical ingredients will encourage
consumerstopurchaseproductswithnaturalingredients.
Chemical agents, such as sulfates and parabens will be increasingly eliminated from
product formulations in view of the widely publicized potential harm associated with
theseingredients.
Marketers are expected to increase their marketing and promotional activities over the
forecastperiod.
Marketers are expected to continue supporting new products with aggressive and
innovativeadvertisingcampaigns.
Several leading marketers including Unilever and Procter & Gamble are expected to
increase their TME spending to support their respective brands over the forecast
period.
Newproductactivityandpromotionsareexpectedtobetheprimegrowthdriversin
themasstradeclass.
ManufacturerssalesareforecasttoincreaseataCAGRof2.5%to$1,870millionby2017,
upfrom$1,653millionin2012.
Unit volume sales are projected to increase at a CAGR of 1.5%, growing from 443million
packagesin2012to480millionpackagesin2017.
4D25
4D26
Conditioners
4A26
ETHNICHAIRCAREPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesofethnichaircareproductsgrow2.1%in2012,from$333millionin
Thecategoryssalesgrowatacompoundannualgrowthrate(CAGR)of1.5%since2007.
Table4D13:HistoricalSalesofEthnicHairCareProducts
Year
$Millionr
Change,%
2007
316
2008
305
(3.5)
2009
314
3.0
2010
328
4.5
2011
333
1.5
2012
340
2.1
rRestated.
Unitsales
Unitsalesinthecategoryadvance1.5%,from97.8millionpackagesin2011to99.3million
packagesin2012.
Retailsales
Retail sales of ethnic hair care products are estimated at $486.0million in 2012, up 2.1%
4D28
EthnicHairCareProducts
Table4D14:ManufacturersSalesofEthnicHairCareProductsintheUnitedStatesbyProductTypeandBrand,2011and2012
$Million
Producttype/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
RELAXERKITS
Dark&Lovely
L'Oral
18
16
17.5
16.0
5.4
4.7
SoftsheenOptimumCare
L'Oral
16
15
15.5
15.0
4.8
4.4
Soft&Beautiful
Unilever
10
9.7
9.0
3.0
2.6
OrganicRootStimulator
DermovivaSkin
Essentials
6.8
8.0
2.1
2.4
JustForMe
Unilever
7.8
8.0
2.4
2.4
GentleTreatment
JohnsonProducts
6.8
7.0
2.1
2.1
PinkOil
LusterProducts
5.8
5.0
1.8
1.5
LusterSCurl
LusterProducts
4.9
4.0
1.5
1.2
AfricanPride
StrengthofNature
3.9
4.0
1.2
1.2
UltraSheen
JohnsonProducts
3.9
4.0
1.2
1.2
CrmeofNature
Colomer
1.9
3.0
0.6
0.9
Realistic
Colomer
1.9
2.0
0.6
0.6
PCJ
LusterProducts
1.0
1.0
0.3
0.3
BeautifulBeginnings
L'Oral
1.0
1.0
0.3
0.3
Fabulaxer
Colomer
1.0
1.0
0.3
0.3
TCB
Unilever
1.0
1.0
0.3
0.3
Motions
Unilever
1.0
1.0
0.3
0.3
10
8.7
10.0
2.7
2.9
103
100
100.0
100.0
30.9
29.4
Allother
Total
STYLINGAIDS
PinkOil
LusterProducts
11.8
11.3
2.4
2.4
Dark&Lovely
L'Oral
10.3
9.9
2.1
2.1
Ampro
Ampro
7.4
9.9
1.5
2.1
Isoplus
MurraysWorldwide
8.8
8.5
1.8
1.8
Soft&Beautiful
Unilever
7.4
7.0
1.5
1.5
LetsJam
L'Oral
5.9
5.6
1.2
1.2
PanteneProV
Procter&Gamble
5.9
5.6
1.2
1.2
L'Oral
4.4
4.2
0.9
0.9
BB
BronnerBrothers
2.9
2.8
0.6
0.6
Realistic
Colomer
2.9
2.8
0.6
0.6
Smooth'NShine
Henkel
2.9
2.8
0.6
0.6
TCB
Unilever
2.9
2.8
0.6
0.6
LeKairCholesterol
ScientificResearch
1.5
1.4
0.3
0.3
Motions
Unilever
1.5
1.4
0.3
0.3
(Continued)
4A28
4D29
$Million
%Oftradeclass
Producttype/brand
Company
2012
2011
2012
2011
2012
1.5
1.4
0.3
0.3
15
16
22.1
22.5
4.5
4.7
68
71
100.0
100.0
20.4
20.9
Dark&Lovely
L'Oral
22
23
41.5
41.1
6.6
6.8
Textures&Tones
Procter&Gamble
11
11
20.8
19.6
3.3
3.2
Bigen
HoyuAmerica
13.2
14.3
2.1
2.4
CrmeofNature
Colomer
7.5
7.1
1.2
1.2
Dark&Natural
L'Oral
7.5
7.1
1.2
1.2
9.4
10.7
1.5
1.8
53
56
100.0
100.0
15.9
16.5
2011
%Oftotal
STYLINGAIDS(Continued)
Parnevu
MurraysWorldwide
Allother
Total
HAIRCOLORINGPRODUCTS
Allother
Total
HAIRDRESSESANDLOTIONS
DermovivaSkin
Essentials
12.5
13.7
1.8
2.1
PinkOil
LusterProducts
10.4
9.8
1.5
1.5
BlueMagic
J.Strickland
6.3
7.8
0.9
1.2
BB
BronnerBrothers
6.3
5.9
0.9
0.9
L'Oral
6.3
5.9
0.9
0.9
AfricanPride
StrengthofNature
6.3
5.9
0.9
0.9
AllWays
Colomer
6.3
5.9
0.9
0.9
TCB
Unilever
6.3
5.9
0.9
0.9
Isoplus
MurraysWorldwide
4.2
3.9
0.6
0.6
Murrays
MurraysWorldwide
4.2
3.9
0.6
0.6
UltraSheen
JohnsonProducts
4.2
3.9
0.6
0.6
SoftsheenOptimumOil
Therapy
L'Oral
4.2
3.9
0.6
0.6
RoyalCrown
J.Strickland
2.1
2.0
0.3
0.3
CombThru
Unilever
2.1
2.0
0.3
0.3
Dax
ImperialDax
2.1
2.0
0.3
0.3
SoftsheenBreakthru
L'Oral
2.1
2.0
0.3
0.3
Motions
Unilever
2.1
2.0
0.3
0.3
12.5
13.7
1.8
2.1
48
51
100.0
100.0
14.4
15.0
Allother
Total
(Continued)
4D30
$Million
Producttype/brand
Company
2011
%Oftradeclass
%Oftotal
2012
2011
2012
2011
2012
SHAMPOOSANDCONDITIONERS
CrmeofNature
Colomer
16.7
18.9
1.8
2.1
PanteneProV
Procter&Gamble
16.7
10.8
1.8
1.2
DermovivaSkin
Essentials
8.3
8.1
0.9
0.9
L'Oral
8.3
8.1
0.9
0.9
PinkOil
LusterProducts
5.6
5.4
0.6
0.6
QueenHelene
QueenHelene
5.6
5.4
0.6
0.6
SoftsheenBreakthru
L'Oral
5.6
5.4
0.6
0.6
Dark&Lovely
L'Oral
5.6
5.4
0.6
0.6
Isoplus
MurraysWorldwide
5.6
5.4
0.6
0.6
LeKairCholesterol
ScientificResearch
2.8
2.7
0.3
0.3
TCB
Unilever
2.8
2.7
0.3
0.3
Motions
Unilever
2.8
5.4
0.3
0.6
13.9
16.2
1.5
1.8
36
37
100.0
100.0
10.8
10.9
Allother
Total
CURL/WAVEMAINTENANCEPRODUCTS
CareFreeCurl/CareFree
CurlGold
L'Oral
29.4
29.4
1.5
1.5
LusterSCurlWave
Nouveau
LusterProducts
17.6
17.6
0.9
0.9
Dark&Natural
L'Oral
11.8
11.8
0.6
0.6
Lustrasilk
InspiredBeautyBrands
11.8
11.8
0.6
0.6
LongAid
KeystoneLaboratories
5.9
5.9
0.3
0.3
TCB
Unilever
5.9
5.9
0.3
0.3
WorldofCurls
J.Strickland
5.9
5.9
0.3
0.3
11.8
11.8
0.6
0.6
17
17
100.0
100.0
5.1
5.0
Allother
Total
CURL/WAVEKITS
CombThru
Unilever
18.8
18.8
0.9
0.9
LusterSCurl
LusterProducts
12.5
12.5
0.6
0.6
SportinWave
L'Oral
12.5
12.5
0.6
0.6
Duke
Johnson&Johnson
6.3
6.3
0.3
0.3
Total
100.0
100.0
2.4
2.4
TOTAL
333
340
100.0
100.0
4A30
CATEGORYDEVELOPMENT
Markettrends
Salesofethnichaircareproductsgrow2.1%in2012.
SeveralleadingmarketersincludingL'OralandUnileverlaunchanewrangeofethnic
haircareproducts,therebysupportingthecategorysgrowth.
Naturallypositionedproductssupportthegrowthofthecategoryasethnicconsumers
increasinglychooseproductsthatcontainnaturalandorganicingredients.
In2012,productsthatcatertospecifichairtypesandhairconcerns,suchasfrizzandcurl,
controlperformwellinthecategory.
Severalleadingmarketers,suchasColomerandUnileverlaunchproductsthatsuitdry
hairandcurlyhairtosupportthecategorysgrowth.
Afewmarketerslaunchproductswithinnovativeformulationsthatcatertotheneeds
oftheethnicconsumers,supportingthecategorysgrowth.
ColomerlaunchesStrengthofNatureBeautifulTexturesthatisintendedforconsumers
withcurlyhairandisalsoclaimedtocontrolfrizz.
Este Lauder launches Aveda Curl Controller that contains organic babassu oil which
smoothesandelongatestightcurlswhilefightingfrizzandconditioninghair.
Ethnic hair care products that are naturallypositioned continue to perform well in the
category.
Incorporationofnaturalandorganicproductsintheethnichaircareproductscategory
continuestogainmomentum.
Several ethnic hair care marketers, such as Carols Daughter and Colomer launch
products with natural ingredients or enhance their existing products with natural
ingredientstosupportthecategorysgrowth.
Naturallypositionedbrands,suchasCrmeofNatureperformwellin2012,andsales
ofthebrandgrowby16.7%,from$12millionin2011to$14millionin2012.
Also, increased awareness and dissatisfaction regarding synthetic chemicalbased
products on the hair, helps ethnic hair consumers shift to the use of natural and
organicproducts.
Moreover,ithasbeenobservedthatnaturallytreatedhairrequireslessmaintenance
thansyntheticchemicallytreatedhair.
FragilephysicalpropertiesofAfricanAmericanhairisanotherimportantreasonforthe
marketerstofocusonnaturalingredients.
In 2012, Carols Daughter introduces Manoi Oil Sacred Strengthening Serum that
containsMonoiOil;asacredTahitianblendoftheTiareGardeniaFlowerandCoprah
CoconutOil,whchclaimstostrengthenhair.
4D31
4D32
IngredientssourcedfromAfricacontinuetoplayanimportantroleinthecategorysgrowth,
duetotheirprovenefficacyandtraditionalusageamongtheAfricanpopulation.
Shea butter, shea oil, and other herbal ingredients of African origin are increasingly
beingincorporatedinproductsaimedatAfricanAmericanconsumers.
Othercommonlyusedingredientsincludealoe,honey,sheaoil,oliveoil,coconutoil,
andavocado.
In 2012, SheaMoisture introduces its Three Butters line of products that contain
ingredientsincludingshea,mango,andavocadobutters.
Therelaxerkitssegmentssalescontinuetodeclinein2012.
AlthoughrelaxershavebeenatthetopoftheAfricanAmericanhairindustryformany
years,2007witnessedabeginningtotheend,withconstantlydecliningsalesofrelaxer
kits.
The socalled naturalista trend primarily contributes to the segments decline in the
category.Thetermappliestopeoplewhoseeknaturalproductsandwhoshunrelaxers
becauseoftheintrinsicharshchemicalformulationsthatallowrelaxerstowork.
Increasingavailabilityofethnichaircareproductsthroughthemasschannelpromotesthe
categorysgrowthin2012.
Mass merchandisers offer premium ethnic hair care brands along with traditional
brands supporting the categorys growth. A few premium variants available at mass
outletsincludeJaneCarterSolutionandMissJessiesCurlsline.
Consumers choose to shop in mass outlets due to the availability of ethnic hair care
productsateconomicalprices.
Notablenewproducts
Table4D15:SelectNewEthnicHairCareProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
AfricanPride
StrengthofNature
BeautifulTexturesconditionshairfromtiptoroot,whilereducingfrizz
CarolsDaughter
MonoiOil
SacredStrengtheningSerumreversesandpreventsdamageto
distressedhaircausedbyheatstyling,colortreating,orchemical
straightening
DermovivaSkin
Essentials
OrganicRoot
Stimulator
Moisturizinghairlotionprotectshairfromhighheat,restoresthe
hairsnaturalmoisturebalance,andstraightensit
DermovivaSkin
Essentials
OrganicRoot
Stimulator
OliveOilBuiltInProtectionisanolyerelaxertoalleviatetheitching
andburningthatsometimesoccurduringtherelaxerprocess
EsteLauder
Aveda
BeCurlyCurlControllerconditionsandreducesfrizz.Itscontains
babassuoil,softeninglocks
EsteLauder
Aveda
BeCurlyCurlEnhancingHairSpray,infusedwithorganicaloeand
wheatprotein
InspiredBeauty
BrandsInc
Lustrasilk
MoistureMaxHydrateTherapyconditionerreconstructs,strengthens,
andprotectsthehairstrand,whilemaintainingmoisturebalance
(Continued)
4A32
Table4D15:SelectNewEthnicHairCareProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
InspiredBeauty
BrandsInc
Lustrasilk
MoistureMaxLeaveInMoisturisingConditioningsprayconditions,
strengthens,andrepairshair
LusterProducts
PinkOil
PinkGlossercontains10naturalingredientsthathelpnourishhairand
addsbrilliantshinetothehair
LusterProducts
PinkOil
PinkStylingShaperpreventshairfromstyledamaging,while
protectinghairfromexcessiveheatstyling
LOral
DarkandLovely
AuNaturaleantibreakagemaintenanceandstylinglineisinfusedwith
mangooilandbamboomilk,nourishmentforallcurltypes
LOral
DarkandNatural
5MinutePermanentHaircolorlocksincolorandleaveshairsoft
LOral
DarkandLovely
HealthyGloss5MoistureHairCrmeinfuseshairwithsupremeshine
andreplenisheshairandscalpwithmoisture
LOral
DarkandLovely
FadeResistantRichConditioningColor,containsmoistureseal
technology,enhancestheconditioningpower
Procter&Gamble
Pantene
TrulyNaturalshampooprovidesmoisture,shine,andhealthtoeach
hairstrand
Procter&Gamble
Pantene
TrulyNaturalconditioneraddsmoistureandhealthtoeachhairstrand
Procter&Gamble
Pantene
TrulyNaturalShineSerumaddsmoisturetohairanditskeyingredient
arganoiladdslonglastingshine
SheaMoisture
ThreeButters
ThreeButtersUtilityShampoo,includesshea,mangoandavocado
butterstoprovidehydration
SheaMoisture
ThreeButters
ThreeButtersUtilityScalpConditionerenhancessmoothnessand
refinesskinstexture
SheaMoisture
ThreeButters
ThreeButtersUtilityGelMoussesmoothesandhydrateshair,while
addinghold
Unilever
Motions
MoisturizingCleansercontainssheabutter,coconut,andavocadooils
Unilever
Motions
SmoothingConditionersoftensandnourisheseventhemost
unmanageablecurls,infusedwithingredientssheabutter,coconut,
andavocadooils
Unilever
Motions
RadiatingGlossprovidesanaturalandevenluster,containsshea
butter
Unilever
Motions
DefineMyCurlsisarichgelthatenhancesmoisturetodeliverthe
ultimatesoft,separatedcurls
Unilever
Motions
HydratemyCurlshydratesandlightlydefinescurls,whilereducing
frizz
Unilever
Motions
DeepConditioningMasquecontainssheabutter
4D33
4D34
Salesbyproducttype
Relaxerkitsisthelargestsegmentinthecategory,accountingfor29.4%ofthecategorys
sales,downfrom30.9%in2011.
Segmentsalesdecline2.9%from$103millionin2011to$100millionin2012.
Despite the growing reluctance to use products with a high proportion of chemicals,
relaxerkitsremainthelargestsegmentinthecategory,asthevastmajorityofAfrican
Americanwomenconsiderrelaxersindispensable.
Styling aids, with a share of 20.9% in 2012, up from 20.4% in 2011, is the secondlargest
segmentinthecategory.
Salesinthesegmentadvanceto$71millionin2012,up4.4%from$68millionin2011.
Thesegmentholdsitsownevenasgeneralmarketstylingproductsincreasinglytarget
ethnicconsumers.
Several leading marketers including Unilever and L'Oral introduce new styling
productstosupportthesegmentsgrowthinthecategory.
In2012,UnileverlaunchesalineofMotionsstylingproductsincludingDefineMyCurls
andHydrateMyCurls.
Haircoloringproducts,withashareof16.5%,isthethirdlargestsegmentinthecategory.
Salesgrow5.7%from$53millionin2011to$56millionin2012.
Ethnic consumers with the primary purpose of gray coverage, continues to drive
segmentgrowth.
Ethnicteenagersandmenareincreasinglydriventohaircolors,followingthefashion
trends.
Hairdressesandlotionssegmentadvancesto$51millionin2012,up6.3%from$48million
in2011.
The segment constitutes 15.0% of the total category sales in 2012, up from 14.4% in
2011.
Sales of shampoos and conditioners grow 2.8% to reach $37million in 2012, up from
$36millionin2011.
Thesegmentaccountsfor10.9%oftheoverallcategorysalesin2012,upfrom10.8%in
2011.
4A34
Table4D16:ManufacturersSalesofEthnicHairCareProductsintheUnitedStatesbyProductType,
2011and2012
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Change,%
Relaxerkits
103
100
30.9
29.4
(2.9)
Stylingaids
68
71
20.4
20.9
4.4
53
56
15.9
16.5
5.7
Hairdressesandlotions
48
51
14.4
15.0
6.3
Shampoosandconditioners
36
37
10.8
10.9
2.8
Curl/wavemaintenanceproducts
17
17
5.1
5.0
2.4
2.4
333
340
100.0
100.0
2.1
Curl/wavekits
Total
COMPETITION
Table4D17:ManufacturersSalesofEthnicHairCareProductsintheUnitedStatesbyCompany,
2011and2012
$Million
Company
%Oftotal
2011
2012
2011
2012
Change,%
LOral
97
95
29.1
27.9
(2.1)
Unilever
39
39
11.7
11.5
LusterProducts
32
30
9.6
8.8
(6.3)
Colomer
20
22
6.0
6.5
10.0
Procter&Gamble
21
19
6.3
5.6
(9.5)
DermovivaSkinEssentials
16
18
4.8
5.3
12.5
JohnsonProducts
13
13
3.9
3.8
MurraysWorldwide
13
13
3.9
3.8
HoyuAmerica
2.1
2.4
14.3
StrengthofNature
2.1
2.1
J.Strickland
1.5
1.8
20.0
63
70
18.9
20.6
11.1
333
340
100.0
100.0
2.1
Allother
Total
4D35
4D36
LOralcontinuestobetheleadingmarketerinthecategory,withanoverallcategoryshare
of27.9%in2012,downfrom29.1%in2011.
Salesofthecompanydecline2.1%,from$97millionin2011to$95millionin2012.
Lackofsignificantmarketingandpromotionalactivitycontributestothesalesdecline
forthemarketerin2012.
In 2012, LOral introduces Dark and Lovely Au Naturale antibreakage maintenance
andstylingline,alongwithafewotherproductintroductionstooffsetitssalesdecline.
LOralsupportsitsbrandswithaninsignificanttraceablemediaexpenditure(TME)of
amere$0.2millionin2012.
Dark & Lovely is the leading brand in the market accounting for 14.1% of the overall
categoryssalesin2012,downfrom14.7%in2011.
Salesforthebranddeclinefrom$49millionin2011toreach$48millionin2012.
Dark&Lovelyistheleadingbrandinhaircoloringproducts,relaxerkits,whileinstyling
itisthesecondleadingbrand.
Lackofmarketingandpromotionalactivitycontributestothebrandssalesdeclinein
2012.
OptimumCareisthesecondleadingbrandforLOralwithanoverallcategoryshareof
6.6%in2012,downfrom6.2%in2011.
Salesofthebranddecline4.5%from$22millionin2011to$21millionin2012.
Unileveristhesecondleadingmarketerinthecategorywithashareof11.5%in2012.
Salesforthecompanyremainflatat$39millionin2012,thesameasin2011.
Lackoftechnologicaladvancementsandlimitednewproductactivityaccountforsales
decline for Unilever in 2012. Limited distribution channels, with beauty supply stores
accountingforthemajority,offsetthegrowthofthemarketer.
Thebrandssalesdecline$1millionfrom$15millionin2011to$14millionin2012.
Soft&Beautifulhaspresenceintherelaxerkitsandthestylingaidssegments.
Lackofmarketingandpromotionalactivitieslimitsthebrandsgrowthinthecategory
in2012.
JustForMeandTCBaretiedforsecondplace,withsalesat$8millioneachin2012.
JustForMeisabrandespeciallyformulatedforchildrenintheagegroupof514years.
TCBisaneconomicalhaircarebranddesignedespeciallyforAfricanAmericanwomen.
SalesoftheMotionsbrandgrowby$1million,from$4millionin2011to$5millionin
2012.Anincreasingnewproductactivitysupportsthebrandsgrowthin2012.Unilever
launchesarangeofMotionsNaturallyYouproductsincludingshampoos,conditioners,
andstylingaidsin2012.
4A36
LusterProducts,thethirdplacedmarketer,hasanoverallcategoryshareof8.8%in2012,
downfrom9.6%in2011.
Salesforthecompanydecline6.3%from$32millionin2011to$30millionin2012.
Lackofnewproductactivityandmarketingcontributetothemarketerssalesdecline
inthecategory.
Pink Oil is the leading brand with sales at $20million in 2012, down 4.8% from
$21millionin2011.
SalesofLusterSCurl,thesecondleadingbrandofLusterProducts,decline10.0%from
Colomer regains its position as the fourthleading marketer in the category, displacing
Procter&Gamble.
Salesofthecompanyadvance10.0%toreach$22millionin2012,from$20millionin
2011.
Increasingnewproductactivitysupportsthemarketerssalesgrowthinthecategoryin
2012.
CrmeofNatureistheleadingbrandwithsalesof$14millionin2012,up16.7%from
$12millionin2011.
Positive performance and an increasing acceptance of natural products support the
brandsgrowthin2012.
In2012,themarketerlaunchesArganOilrangeofnaturalethnichairproductsacross
varioussegmentsincludingstylingaids,shampoos,conditioners,andhaircoloring.
RETAILDISTRIBUTION
In2012,beautysupplystoreslosedistributionby2.2%toaccountfor45%ofthetotalretail
sales.
Beautysupplystorescontinuetobetheleadingretailchannelin2012.
The share of mass merchandisers as a retail outlet for ethnic hair care products remains
constantat27%.
The increase in the share of mass merchandisers is a result of the increased sales of
ethnic hair care products from such stores due to the availability of products at
economicalprices.
Theretaildistributionproportionbetweendrugstores,andprofessionaloutletsremainsthe
samein2012,asseenin2011.
Foodstoresshareincreasesto7%.
4D37
4D38
Table4D18:ManufacturersSalesofEthnicHairCareProductsintheUnited
%Oftotal
Retailoutlet
2011
Beautysupplystores
46
45
Massmerchandisers
27
27
Drugstores
20
20
Foodstores
Professionaloutlets
100
100
Total
2012
MARKETINGACTIVITY
TotalTMEforethnichaircarereducesdrasticallyfrom2011.ThetotalTMEinthecategory
isestimatedatamere$1.1millionin2012,comparedto$2.9millionin2011.
Pricebased promotions and discount coupons continue to be an important means of

promotingsalesofethnichaircareproducts.
Marketers continue to attract consumers through pricebased promotions, as this is
oneofthekeyfactorswhichinfluenceconsumerstotrynewproducts.
Discount coupons are distributed through magazines, the Internet, and freestanding
inserts(FSIs).
includingLOralandUnilever.
Marketersrelyontelevisionandprintmediatopromoteethnichaircareproducts.
Advertisements for ethnic hair care products are featured in magazines and on
televisionprogramswithastrongfollowingamongAfricanAmericans.
AfricanAmericancelebritiesarecommonlyfeaturedinthepromotioncampaigns.
Bria Murphy, actress and model, continues to be the brand ambassador for the
SoftsheenCarson brand. Bria Murphy features in various media advertisements
includingtelevisionandprint.
In2012,WeAreOnyxlaunchesanonlinebeautyplatform,weareonyx.com,establishedto
catertotheneedsofethnicconsumersonpersonalcarebeauty.
WeAreOnyx.com website touts itself as an online video platform that lets ethnic
consumerslearnfrombeautyexpertswholooklikethem(AfricanAmericans),shopfor
recommended products directly from the video page, and sample everything before
theymakepurchases.
Memberspayafeeof$20/monthfortheeducationandsamples.
4A38
Marketerspromoteethnichaircareproductsthroughsocialmedianetworksitesincluding
FacebookandPinterest.
New product information and promotional offers are presented by all the leading
brandsincludingSoftsheenCarsonthroughtheirrespectivepagesonFacebook.
DetailsonTMEareprovidedintheAdvertisingsectionofthisreportandinthedatabase.
OUTLOOK
Theethnichaircarecategoryisexpectedtopostmoderategrowthovertheforecastperiod,
2012to2017.
ThecategoryisexpectedtogrowataCAGRof1.8%overtheforecastperiod.
TheethnicpopulationisprojectedtogrowfasterthantheoverallAmericanpopulation
supportingtheoverallcategorysgrowth.
Productinnovationwilldrivethecategoryssalesovertheforecastperiod.
Products that cater to specific hair concerns, such as curl control, protection against
breakage,andvarioushairtypesareexpectedtoperformwellovertheforecastperiod.
Marketers are expected to incorporate additional hair care benefits, such as frizz
protection and curl control into their products to support their respective market
shares.
Ethnichaircareproductsthatarepositionedasnaturalorcontainnaturalingredientsare
expectedtogrowsignificantlyovertheforecastperiod.
Consumers are likely to continue seeking products that contain natural ingredients,
suchastiareflower(softens,purifies,andsoothes)andfloralextracts.
Several leading marketers including Unilever and Luster Products are expected to
eliminatechemicalagents,suchassulfatesandparabensfromtheirproducts.
Relaxerkitsareexpectedtoleadthecategorysshareovertheforecastperiod.
Relaxerkitsareexpectedtoretainitspositionastheleadingsegmentinthecategory.
However,relaxerkitsareexpectedtoexperiencesalesdeclineovertheforecastperiod,
duetothegrowingawarenessabouttheuseofharmfulchemicalsusedinrelaxerkits
totreathair.
The segments growth can rebound if the leading marketers introduce products with
innovativeformulationsovertheforecastperiod.
RelaxerkitscontinuetobeanintegralpartofmanyAfricanAmericanconsumershair
regimenandwilltakeawhiletotransitiontootherproducts.
4D39
4D40
Consistent with trends in the general market, AfricanAmerican men are increasingly
focusedongrooming.
Anumberofmenareoptingforlongerhairstyles,suchascornrowsandbraids,which
requirestylingaids.
Mens hair coloring products are also expected to grow in sales during the forecast
period.
Foamhaircolors,whichcontinuetodowellintheoverallmarketin2012,willlikelybe
formulatedforAfricanAmericanhair,drivingsalesinthissegment.
However,thecategoryisexpectedtofacecompetitionfromgeneralhaircarebrandsthat
have hair colors and hair styling product which are attractive to ethnic consumers,
especiallyamongtheyoungerpopulation.
Thecategorysgrowthwillbelimitedwiththepopularityofwigsandhairextensionsin
theUnitedStates.
Sales at the manufacturers level are projected to increase at a CAGR of 1.8% from
Unit volume is projected to increase at aCAGR of 1.3% over the forecast period to reach
105.8millionpackagesin2017,upfrom99.3millionpackagesin2012.
4A40
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesforthehaircoloringproductscategorydeclinemarginallyby0.5%to
$1,317millionin2012,downfrom$1,323millionin2011.
Since2007,thecategoryssaleshavegrownatacompoundannualgrowthrate(CAGR)of
0.6%.
Table4D19:HistoricalSalesofHairColoringProductsin
Year
$Millionr
Change,%
2007
1,277
2008
1,291
1.1
2009
1,257
(2.6)
2010
1,280
1.8
2011
1,323
3.4
2012
1,317
(0.5)
rRestated.
Unitsales
Unitsalesinthecategorydeclineby0.9%from227millionpackagesin2011to225million
packagesin2012.
Retailsales
Retail sales of hair coloring products total $1,677.7million in 2012, down 0.5% from
$1,686.7millionin2011.
4D42
HairColoringProducts
Table4D20:ManufacturersSalesofHairColoringProductsintheUnitedStatesbyCompanyand
Brand,2011and2012
$Million
Company/brand
Producttype
%Oftotal
2011
2012
2011
2012
LORAL
L'OralExcellenceCrme
Permanent
146
152
11.0
11.5
Preference
Permanent
153
151
11.6
11.5
GarnierNutrisse
Permanent
92
97
7.0
7.4
Fria
Permanent
78
73
5.9
5.5
NaturalMatch
Permanent
23
21
1.7
1.6
L'OralCouleurExperte
Specialeffects
22
21
1.7
1.6
ColourRays
Permanent
17
17
1.3
1.3
PreferenceLesBlondissimes
Permanent
15
13
1.1
1.0
HiLightStyliste
Permanent
13
13
1.0
1.0
Frost&Design
Lightener
0.6
0.6
ToneRefiner
Lightener
0.6
0.6
Garnier100%Colora
Permanent
0.2
70
72
5.3
5.5
648
646
49.0
49.1
ClairolNice'NEasyb
Permanent
142
130
10.7
9.9
ClairolNaturalInstincts
Semipermanent
75
67
5.7
5.1
NiceNEasyColorBlendFoam
Permanent
35
37
2.6
2.8
BalsamColor
Semipermanent
0.5
0.5
Frost'NTip
Lightener
0.5
0.5
ClairolLovingCarea
Semipermanent
0.6
ClairolHydriencea
Permanent
0.3
ClairolMen'sChoicea
Haircolorformen
0.2
ClairolTouchofSuna
Lightener
0.2
ClairolUltressa
Permanent
0.1
58
62
4.4
4.7
341
308
25.8
23.4
RevlonColorsilk
Permanent
130
135
9.8
10.3
Frost&Glow
Lightener
0.4
0.4
Allother
12
12
0.9
0.9
Total
147
152
11.1
11.5
Allother
Total
PROCTER&GAMBLE
Allother
Total
REVLON
(Continued)
4A42
Table4D20:ManufacturersSalesofHairColoringProductsintheUnitedStatesbyCompanyand
Brand,2011and2012
Company/brand
Producttype
$Million
%Oftotal
2011
2012
2011
2012
COMBE
JustforMenc
Haircolorformen
110
115
8.3
8.7
GrecianFormula
Haircolorformen
0.6
0.5
Total
118
122
8.9
9.3
26
38
2.0
2.9
15
23
1.1
1.7
0.5
0.5
22
22
1.7
1.7
1,323
1,317
100.0
100.0
KAO
JohnFriedaPrecisionFoamColour
DEVELOPLUS
Permanent
Developlus
Semipermanent
SANOFI
SunIn
Specialeffects
ALLOTHER
TOTAL
aDiscontinued.
bIncludesPerfect10.
cIncludesJustForMenTouchofGray.
rRestated.
CATEGORYDEVELOPMENT
Markettrends
Salesforthehaircoloringcategorydeclinesmarginallyin2012.
As the economy continues to recover in 2012, consumers are moving back to
professional hair coloring services, attributing to the decline of the athome hair
coloringcategory.
Mostconsumersvisitsalonsforhaircoloringasitlastsforalongerperiodcomparedto
theathomehaircoloringproducts.
New product activity continues to be sluggish in 2012, with very few product lines
beingintroducedduringtheyear.
Productswithnewformulations,suchashairfoamscontinuetogrowin2012.
Foamformulationsinhaircoloringproductsremainasignificanttrend,whichbeganin
2011.
Advantages,suchasdripfreeformat,100%graycoverage,longlasting,andconvenient
application,increasethedemandforfoamhaircolors.
Severalleadingmarketers,suchasKaoandLOral,launchmorenewfoambasedhair
coloringproducts.
Afewofthekeyvariantsintroducedinthissegmentin2012includeGarnierNutrisse
NourishingcolorfoambyLOralandSammyFatcolorfoambyHoyuAmerica.
4D43
4D44
In2012,professionalhaircoloringproductsgainmorepopularityoverathomehaircoloring
products,asmoreconsumersvisitsalons.
With the economic recovery in 2012, women are increasing their frequency of salon
visitsforroottouchuporhaircolor.
Womenconsumersareincreasingthefrequencyoftheirsalonvisitsfromprioryears,
supportingthegrowthofprofessionalhaircoloringproducts.
Thehaircoloringproductscategoryalsobenefitsfromfavorabledemographicandproduct
trends.
The baby boomers population who need to cover graying hair continues to grow in
2012.
Increasingavailabilityofathomehaircoloringproductsencouragesmorepeopletotry
them.
The fashionforward younger consumers continue to experiment with their looks by
changingtheirhaircolor.
Haircoloringmarketerscontinuetoincorporatenaturalingredientsintheirnewproducts.
Haircoloringproductsthatarefreefromchemicals,suchasammoniacontinuetogrow
inthecategory.
Ammonia, a key ingredient present in most permanent hair colors available in the
market,isaharshchemicalwhichhelpsopenupthesurfaceofthehairstrandtoallow
thehaircolortopenetratethrough.
In2012,RevlonlaunchesanammoniafreeLuxuriousColorsilkButtercreamNourishing
PermanentCreamColor.
Kaocontinuestogrowsignificantly,postinganincreaseof46.2%in2012,afteritsmarket
entryin2011withitsnewfoambasedhaircolors.
Themarketercontinuestoaddmoreshadestoitsfoambasedcolorsin2012.
4A44
Notablenewproducts
Table4D21:SelectNewHairColoringProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Combe
JustForMen
TheAutostophaircolorisatechnologybreakthrough,involving
thedyeandthehydrogenperoxidealreadymixedinasingle
tubewithascrewedoncomb.Theeffectofthecolordoesnot
getdarkerthanitshouldirrespectiveofthetimeperiodfor
whichitiskepton.Itcomesinareadytouseconvertibletube
andcolorshairin10minutes.Itcomesinfivepermanentshades
Developlus
Splat
SplatHairColorisavailableasoneapplicationkitthatincludes
color,bleach,andperoxide.Itformsaprotectiveshieldthat
preventsthecolorfromwashingout
HoyuAmerica
Sammy
FatFoamisnondripwhippedfoamthatwrapshairstrands
leavingevencoloredhair.Itisavailablein10shadesandeachkit
containscolorpowder,basesolution,gloves,shampoo,
conditioner,mixingshaker,andinstructions
Kao
JohnFrieda
ThemarketeraddsmoreshadestoitsPrecisionFoamColor,
permanenthaircolor,availablein30shades
L'Oral
Fria
FriaWildOmbreisanathomehaircoloringproductthatclaims
togivemultishadeeffectswithonepackage.Itisavailablein
shades,suchasmediumtodarkbrown;darkblondetolight
brown;andlighttomediumblonde.Thepatentedbrush
applicatorallowsquickandpreciseapplication
L'Oral
GarnierNutrisse
Theproductisammoniafreeandcontainsbambooextract
whichreinforcesthehair'sprotectivecuticlelayerwhilecoloring
L'Oral
Preference
Thepermanenthaircolorisoptimizedwithfadedefying
conditionersthatkeephairsilkyandhealthyfromroottotip.
Theproductconcealsgrayhairandisavailablein37shades
rangingfromdarkblondetodarkbrown
L'Oral
GarnierOlia
Theproductisavailablein23shadesanduses60%oilblendwith
naturalfloweroilsinthecolorant.Thisoilbasedformulaincites
colorantstopenetratedeepintohairforlongerlastingcolor
RevlonColorsilk
LuxuriousColorSilkButtercreamisanammoniafree,permanent
athomehaircolorthatisavailablein13shades.Theformula
preventsoversaturationofdyetoattainuniformcolor
throughout
Revlon
4D45
4D46
Salesbyproducttype
Permanenthaircolorcontinuestobethelargestproducttype,accountingfor68.3%ofthe
categoryssalesin2012.
Manufacturerssalesfortheproducttypegrow0.8%,upfrom$893millionin2011to
$900millionin2012.
Female consumers above 30 years of age mostly use permanent hair colors to cover
theirgrayhair.
Introduction of new permanent hair colors by several leading marketers including
LOralsupportthesalesgrowthofthesegmentin2012.
Salesofsemipermanenthaircolorsdecline18.0%,from$89millionin2011to$73million
in2012.
Theshareofsemipermanenthaircolorsintheoverallhaircoloringcategorydeclines
to5.5%in2012,downfrom6.7%in2011.
Thedeclineisseenasyoungerconsumersmovetowardsproductsthatprovidespecial
effectswhiletheolderconsumersgravitatetowardspermanentcolors.
Anumberofsemipermanentlines,suchasClairolLovingCarehavebeendiscontinued,
andnonewonesareintroduced.
Salesofhaircolorformenadvance7.4%,upfrom$121millionin2011to$130millionin
2012.
Thehaircolorformensegmentaccountsfor9.9%ofthesalesinthecategoryin2012,
upfrom9.1%in2011.
Sales of Combe, the leading marketer for mens hair color, grow at 3.4% to reach
$122millionin2012,upfrom$118millionin2011.Itsdominantpositioninthemens
haircolorsegmentisgrowing,asisitsbrandequity.
OthermajormarketersinthesegmentincludeProcter&GambleandLOral,butthey
trailCombesignificantly.
Furthergrowthinthesegmentisoffsetbyminimalnewproductactivityanddearthof
innovations.
Sales of the special effects segment post a decline of 3.6% to reach $27million in 2012,
Thenichesegmentaccountsforamere2.1%shareoftheoverallcategorysalesin2012,
thesameasin2011.
Limited new product activity and discontinuation of Procter & Gambles Herbal
Essenceslinein2011contributestothesalesdeclineinthesegmentin2012.
Sales of lighteners continue to decline reaching $27million in 2012, down 10.0%, from
$30millionin2011.
4A46
Table4D22:ManufacturersSalesofHairColoringProductsintheUnitedStatesbyProductType,
2011and2012
$Million
Producttype
2011
2012
893
900
Semipermanent
89
Haircolorformen
2011
2012
67.5
68.3
0.8
73
6.7
5.5
(18.0)
121
130
9.1
9.9
7.4
Specialeffects
28
27
2.1
2.1
(3.6)
Lighteners
30
27
2.3
2.1
(10.0)
162
160
12.2
12.1
(1.2)
1,323
1,317
100.0
100.0
(0.5)
Permanent
Allother
Total
%Oftotal
Change,%
COMPETITION
Table4D23:ManufacturersSalesofHairColoringProductsintheUnitedStatesbyCompany,
2011and2012
Company
$Million
%Oftotal
2011
2012
2011
2012
Change,%
LOral
648
646
49.0
49.1
(0.3)
Procter&Gamble
341
308
25.8
23.4
(9.7)
Revlon
147
152
11.1
11.5
3.4
Combe
118
122
8.9
9.3
3.4
69
89
5.2
6.8
29.0
1,323
1,317
100.0
100.0
Allother
Total
(0.5)
In2012,LOralcontinuestobetheleadingmarketerinthecategory.
LOralaccountsforanestimated49.1%ofthecategoryssalesin2012.
Salesdeclinemarginallyby0.3%from$648millionin2011to$646millionin2012.
LOraldecreasesitsmarketingactivitycontributingtoitssalesdeclinein2012.
ThemarketerallocatesTMEofapproximately$164.8millionin2012,down11.4%from
$186.1millionin2011.
LOralsproductofferingsmainlycomprisepermanenthaircolors.
brandsofthecompany.
Sales of LOrals leading brand, L'Oral Excellence Crme, post a growth of 4.1% in
2012 and Garnier Nutrisse experiences growth of 5.4%, whereas L'Oral Preference
declines1.3%.
4D47
4D48
ThemarketersupportsthesalesgrowthofL'OralExcellenceCrmeswithanincrease
inpromotionalactivity(TME)in2012.
The marketer allocates a TME of approximately $32.7 million in 2012, up from
$21.2millionin2011topromotetheL'OralExcellenceCrme.
Garnier Nutrisse enjoys a growth of 5.4% in 2012, with sales reaching $97million in
2012,upfrom$92millionin2011.
Sales of Garnier Nutrisse are supported by the launch of Garnier Nutrisse Nourishing
HairColorFoamin2012.
In spite of new product activity and significant TME support of $18million in 2012,
salesofFriadeclineto$73millionin2012,down6.4%from$78millionin2011.
NaturalColorMatchexperiencesadeclineof8.7%to$21millionin2012,downfrom
$23millionin2011.
In 2012, sales of Couleur Experte decline by 4.5%, from $22 million in 2011 to
$21millionin2012.
SalesofColourRaysremainstagnantat$17millionin2012,sameas2011levels.
Preference Les Blondissimes, a line targeting blonde consumers, declines further to
$13millionin2012,down13.3%from$15millionin2011.
Smallerlighteninghaircolorlines,Frost&DesignandToneRefiner,remaindormantin
2012at$8millioneach.
A few distinct hair color lines, such as Superior Preference and Wild Ombre, are
launchedin2012.
Sales of Procter & Gamble, the secondleading marketer, decline to $308million in 2012,
down9.7%from$341millionin2011.
Procter % Gambles overall share in the categorys sales fall from 25.8% in 2011 to
23.4%in2012,duetothedeclineinthesalesofClairolNiceNEasyandClairolNatural
Instinctslines.
Limitednewproductactivityalsocontributestothemarketersdeclineinthecategory.
Salesdeclineforthemarketerinthecategorycanalsobeattributedtothesignificant
decreaseinthemarketingactivity.Procter&GamblesTMEforhaircoloringproducts
declines significantly by 32.2% in 2012, down from $82.3 million in 2011 to
$55.7millionin2012.
ClairolNiceNEasyColorBlendFoamistheonlybrandtoexperiencegrowthin2012;
thebrandgrowsby5.7%,from$35millionin2011to$37millionin2012.
Thesuccessoffoambasedcolorantssupportsthebrandsgrowthinthecategory.
ThesalesofthebrandarealsosupportedbyaTMEofalmost$21millionin2012.
Nice N Easy drops by 8.5% while Natural Instincts declines by 10.7% to $130million
and$67million,respectively,in2012.
Balsam Color manages to maintain its sales at $6million in 2012, for the second
consecutiveyear.
FrostNTipssalesdeclineby14.3%,from$7millionin2011to$6millionin2012.
Themarketerdiscontinuesseveralproductsin2011,contributingtothesalesdeclinein
2012.
Some of the brands that were discontinued by the marketer in 2011 include Loving
Care,ClairolHydrience,ClairolMen'sChoice,ClairolTouchofSun,andClairolUltress.
4A48
Revlonpostsamoderategrowthof3.4%toreach$152millionin2012,from$147millionin
2011.
The leading brand, Revlon Colorsilk, posts a healthy growth of 3.8%. Sales advance
from $130million in 2011 to $135million in 2012. However, further growth of the
marketerisrestrictedbynegligibleTME.
TheExtensionoftheColorsilkrangecontributestothemarketersgrowthin2012.
RevlonintroducestheLuxuriousColorsilkButtercreamlinein2012.Theproductlineis
apermanenthaircolorlinethaterasesgrayhair.Theproductisammoniafreeandis
availablein13shades.
Combe, the leading marketer of mens hair coloring products, posts a growth of 3.4% in
2012.
Manufacturers sales for the company increase to $122million in 2012 from
$118millionin2011.
Themarketerholdsmorethan85.0%marketshareofthemenshaircoloringsegment.
TheintroductionofJustForMenAutostoplinesupportsthegrowthofthemarketerin
2012,withthemarketerallocatingapproximately$22.1millioninTMEforthebrand.
TheJustforMenbrandhassolidbrandequityandiswellpositionedinthemarketplace.
However, Grecian Formula fails to perform well in 2012 showing a 12.5% decline in
salesfrom$8millionin2011to$7millionin2012.
GrecianFormulaisatreatmentforgrayhairwhichrequiresapplicationeverydayfor
the first two weeks. The complexity of everyday application and slow results over a
period of two weeks dissuades consumers from using the product, and they shift to
moreconvenientandfasterresultorientedproducts.
Developlus sales grow significantly by 53.3%, from $15 million in 2011 to $23 million in
2012.
Thecompanyoffersthreesemipermanenthaircolorbrandsinthecategory:Splat(also
inwashablehaircolorsinvividcolorslikepink,purpleandblue),Satin(withaloevera
base), Xora (avocado oil base and magnetically charged color molecules). Another
brand,ColorOops,isahaircolorremover,whichisnotcoveredinthisstudy.
Themarketerhasamarketshareof1.7%inthehaircoloringcategoryin2012,upfrom
1.1%in2011.
RETAILDISTRIBUTION
Theretaildistributionforhaircoloringproductsremainspracticallyunchangedin2012,in
syncwith2011.
Mass merchandisers and drug stores tie in the first place as the leading retail
distributionchannelsforhaircolor.
4D49
4D50
Table4D24:ManufacturersSalesofHairColoringProductsinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
39
39
Drugstores
39
39
Foodstores
18
18
100
100
Specialtystores
Total
MARKETINGACTIVITY
In2012,promotionalactivitiesforhaircoloringproductsincludetelevision,electronicand
printmediaadvertisements,couponing,andretailactivities.
Television advertising remains the leading promotional method in the category,
followedbyonlineadvertisements.
Pricebased promotions and media advertisements are also an important means of

promotingsalesofhaircoloringproducts.
Pricebasedpromotionthroughcouponsisanimportantmeansofenticingconsumers
topurchasehaircolors.
Discountcouponsaredistributedthroughmagazinesandfreestandinginserts(FSIs).
includingLOralandProcter&Gamble.
Dedicatedbrandwebsitesareemergingasanimportantmediumtopromotehaircoloring
products.
Brandwebsitesofhaircoloringproducts,suchasGarnierandClairolfeatureadviceon
haircoloringandhelpthevisitorschoosetherightshadeofhaircolor.
The Internet is also one of the major sources of advertising marketers use for promoting
theirrespectivebrands.
Social media sites, such as Facebook and Twitter, are widely used by marketers for
advertisingtheirproducts.
Many of the new launches and product information is provided by the marketers
throughtheirrespectivepagesonFacebook.
4A50
In 2012, TME for hair coloring products total $296.5million, down 14.6% from
Marketersspendabout61.0%ofTMEor$180.3millionontelevisionadvertisementsin
2012,followedbymagazinesat$107.8million.
LOralcontinuestobetheleadingmarketerintermsofadvertisingexpendituresaswellas
category sales, with a TME of $164.1million in 2012, down 11.8% from $186.1million in
2011.
The company spends approximately 64.2% or $105.8million on television
advertisementsin2012.
ATMEof$32.7millionisallocatedtopromoteL'OralExcellenceCrme.
GarnierNutrissesadvertisementexpenditurein2012totals$53.8million.
Procter & Gambles media spend on the hair coloring category in 2012 is $55.7million,
downsignificantlyby32.2%,from$82.3millionin2011.
The company spends approximately 59.6% or $33.2 million on television
advertisementsfollowedbymagazineadvertisementswith$21.7million.
NiceNEasyhairfoamgarnersalionsshareoftheTMEat$20.4million.
TheClairolNaturalInstinctslineissupportedwith$13.0million.
Combe,whichspecializesinmenshaircolor,spends$33.1millionpromotingitsbrandsin
2012,down25.0%from$26.4millionin2011.
The marketer allocates almost 91.5% or $30.3 million of its TME through television
advertisements.
Just For Men Autostop, launched in 2012, garners a lions share of the TME at
$22.1million.
FurtherdetailsonTMEcanbefoundintheAdvertisingsectionofthisreport.
OUTLOOK
The hair coloring category is expected to experience moderate growth over the forecast
period.
Thecategoryisexpectedtogrowby0.7%duringtheforecastperiod,2012to2017.
Theagingpopulationwillcontributetothecategorysgrowthinthefuture.
Agingconsumerswillcontinuetoseekcoloringproductsthathavethemainbenefitof
coveringgrayhair.
The aging population or consumers in the 35to65 age group will be the leading
consumer segment for the category and are likely to drive the sales growth of
permanenthaircoloringproducts.
Permanenthaircolorswillcontinuetobetheleadingsegmentinthecategory,asthey
arethemostsuitableproductsforcompletegraycoverage.
4D51
4D52
Several leading manufacturers, such as LOral and Procter & Gamble, are expected to
supportthecategorysgrowthwithnewproductintroductions.
New products are expected to have improved formulations and colors, following the
markettrend.
Young consumers who consider hair color as a fashion statement will also continue to
supportthecategorysgrowth.
Brighthuesincoloringproductsappealtoyoungerconsumersandwillcontinuetobe
popularduringtheforecastperiod.
Innovationswithimprovedformulationsinthehaircoloringproductsareexpectedtorevive
thecategorysgrowthovertheforecastperiod.
Productswithimprovedformulations,suchasfoambasedandcreambasedhaircolors
Marketerslaunchingnewfoambasedproductsarealsoexpectedtoexperiencegrowth
through2017.Thefoamcoloringproductsarelessmessywithaconvenientapplicator
andareavailableinadripfreeformula,andareincreasinglypreferredbyconsumers.
Foambasedproductsthatarefreefromammoniaandchemicalswillbethepreferred
haircoloringproducts.
New marketers are also expected to enter the foambased hair colors segment, with
otherevolvingformulations,therebysupportingthecategorysgrowththrough2017.
Foreaseofapplication,haircoloringproductsarelikelytohaveimprovisedfeaturesin
factors,suchasapplicationmethod,applicationtime,andformulationconsistency.
Ongoingactiveresearchanddevelopmentactivitieswillresultinimprovementsinproduct
quality.
Hair coloring products are expected to incorporate a number of additional benefits,
includingnourishmentofhairandsunprotection.
Antiaging properties are likely to emerge as an important additional benefit of hair
coloringproducts.
Marketersareexpectedtolaunchhaircoloringproductswithaddedbenefits,suchas
nourishing,glossy,andsleeklook.
Consumerswillcontinuetolookforhaircoloringproductsthatcontainnaturalingredients,
suchasherbalandfloralextract.
Naturalhaircoloringproductsthatwillnotcausedamagetothehairarelikelytohave
gooddemandinthefuture.
Negativeimpactofammoniahaircolorsisexpectedtomakeconsumersshifttonatural
products.
4A52
The mens hair coloring segment will continue to show growth over the forecast period,
supportedbynewproductlaunchesandinnovations.
The leading marketer in the segment, Combe will continue to do well through the
forecastperiod.
The category is expected to revive with the launch of new products with innovative
formulations,suchasJustForMenAutostopline,whichisatechnologybreakthrough
involvingthedyeandthehydrogenperoxidebeingalreadymixedinasingletubewith
ascrewedoncomb,tosupportthecategorysgrowth.
Manufacturers sales of the category are forecast to grow at a CAGR of 0.7% to

However, as the economy recovers, consumers are expected to shift to professional
haircoloringproducts,limitingthecategorysgrowth.
Unit sales are projected to grow at a CAGR of 0.4%, from 225million units in 2012 to
230millionunitsin2017.
4D53
4D54
4A54
HAIRSTYLINGPRODUCTSANDSPRAYS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesofhairstylingproductsandspraysadvanceto$1,680millionin2012,
Saleshavedeclinedatcompoundannualgrowthrate(CAGR)of0.4%from2007.
Table4D25:HistoricalSalesofHairStylingProductsinthe
Year
$Millionr
2007
1,713
2008
1,695
(1.1)
2009
1,632
(3.7)
2010
1,650
1.1
2011
1,658
0.5
1,680
1.3
2012
rRestated.
Change,%
Unitsales
Unit sales in the category grow 1.0% to 528.7million packages in 2012, up from
Retailsales
Retail sales of hair styling products total $2,481.1million in 2012, up 1.7% from
4D56
HairStylingProductsandSprays
Table4D26:ManufacturersSalesofHairStylingProductsintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
2011
TRESemm
Unilever
115
GarnierFructis
L'Oral
PanteneProV
%Oftradeclass
2012
%Oftotal
2011
2012
2011
2012
124
10.2
10.9
6.9
7.4
84
82
7.4
7.2
5.1
4.9
Procter&Gamble
70
61
6.2
5.4
4.2
3.6
Suave
Unilever
60
59
5.3
5.2
3.6
3.5
FrizzEase
Kao
56
58
4.9
5.1
3.4
3.5
HerbalEssences
Procter&Gamble
53
56
4.7
4.9
3.2
3.3
Aussie
Procter&Gamble
56
55
4.9
4.8
3.4
3.3
Got2B
Henkel
51
52
4.5
4.6
3.1
3.1
StudioLine
L'Oral
39
35
3.4
3.1
2.4
2.1
Nexxus
Unilever
32
32
2.8
2.8
1.9
1.9
Axe
Unilever
26
27
2.3
2.4
1.6
1.6
WhiteRain
BrynwoodPartners
12
14
1.1
1.2
0.7
0.8
SalonGrafix
ContinentalFragrances
14
13
1.2
1.1
0.8
0.8
JohnFrieda
KaoUSA
12
12
1.1
1.1
0.7
0.7
Organix
VogueInternational
12
0.6
1.1
0.4
0.7
L.A.Looks
BrynwoodPartners
13
11
1.1
1.0
0.8
0.7
Consort
Unilever
12
11
1.1
1.0
0.7
0.7
Dove
Unilever
11
11
1.0
1.0
0.7
0.7
AquaNet
Lornamead
10
10
0.9
0.9
0.6
0.6
AlbertoVO5
BrynwoodPartners
0.7
0.6
0.5
0.4
Dep
BrynwoodPartners
0.7
0.5
0.5
0.4
FX
VogueInternational
0.6
0.5
0.4
0.4
Brylcreem
Combe
0.5
0.4
0.4
0.3
SheerBlonde
Kao
0.4
0.4
0.3
0.3
Finesse
Lornamead
0.4
0.4
0.3
0.2
Hask
0.4
0.3
0.2
0.2
Condition
HelenofTroy
0.4
0.3
0.2
0.2
Vitalis
HelenofTroy
0.3
0.3
0.2
0.2
Fekkai
Procter&Gamble
0.2
0.3
0.1
0.2
FinalNet
HelenofTroy
0.2
0.2
0.1
0.1
SalonStyle
0.1
0.1
0.1
0.1
Protein29
TheStephanCompany
0.1
0.1
0.1
0.1
Allother
Unilever
54
52
4.8
4.6
3.3
3.1
Allother
Henkel
0.7
0.7
0.5
0.5
MASS
(Continued)
4A56
4D57
Table4D26:ManufacturersSalesofHairStylingProductsintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
2011
%Oftradeclass
2012
%Oftotal
2011
2012
2011
2012
MASS(Continued)
Allother
SunProducts
0.2
0.2
0.1
0.1
Allother
Kao
0.2
0.2
0.1
0.1
278
290
24.5
25.5
16.8
17.3
1,133
1,138
100.0
100.0
68.3
67.7
11.4
11.7
3.4
3.5
11.2
11.1
3.4
3.3
Allother
Total
PROFESSIONAL
Redken
L'Oral
57
59
PaulMitchell
JohnPaulMitchell
Systems
56
56
Matrix
L'Oral
49
51
9.8
10.1
3.0
3.0
TIGI
Unilever
49
48
9.8
9.5
3.0
2.9
Aveda
EsteLauder
37
37
7.4
7.4
2.2
2.2
Sebastian
Procter&Gamble
35
34
7.0
6.8
2.1
2.0
Bumbleandbumble
EsteLauder
27
28
5.4
5.6
1.6
1.7
AmericanCrew
Colomer
21
22
4.2
4.4
1.3
1.3
Nioxin
Procter&Gamble
11
13
2.2
2.6
0.7
0.8
Alterna
TSG
1.2
1.4
0.4
0.4
152
148
30.4
29.4
9.2
8.8
500
503
100.0
100.0
30.2
29.9
12
26
85.7
92.9
0.7
1.6
Allother
Total
DIRECT
Wen
Allother
GuthyRenker
Total
14.3
7.1
0.1
0.1
14
28
100.0
100.0
0.8
1.7
83.3
83.3
0.3
0.3
16.7
16.7
0.1
0.1
100.0
100.0
0.4
0.4
100.0
100.0
0.3
0.3
1,658
1,680
100.0
100.0
SPECIALTY
Victoria'sSecret
Allother
LimitedBrands
Total
LUXURY
Allother
TOTAL
4D58
CATEGORYDEVELOPMENT
Markettrends
Hair styling products with new formulations and new forms continue to support the
categorysgrowthin2012.
Hair styling products with improved product forms, such as gels, sprays, hard/soft
waxes,andpomadesininnovativepackaginghelpinthecategorysgrowth.
Moreover, innovative product forms, such as styling putty and pomades, better
product functions, such as volumizers and thickeners, packaging, and colors support
thecategoryssales.
In 2012, L'Oral launches a line of styling putty products under the Garnier Fructis
brand;thekeyvariantsincludeCleanSleekPowerPutty,SufferHairPowerPutty,and
MessMakerPowerPutty.
Hairstylingproductsthatcontainnaturalandorganicingredientsremainaprominenttrend
in2012,helpinginthecategoryssalesgrow.
Hairstylingproductsaregettingcommonlyformulatedwithnaturalingredients,such
asbotanicalingredients,fruitextracts,andnaturaloils.
Several leading marketers, including L'Oral and Unilever, introduce products with
naturalformulationstosupporttheirsalesinthecategory.
In2012,L'OrallaunchesEverStylerangeofhairstylingproductsthatcontainnatural
ingredientsincludingbotanicalextracts,andtheproductlineisfreefromalcoholand
parabens.
Growing awareness about the benefits of using natural ingredients and support from
marketers in the form of new product activity, makes consumer pick hair styling
products that are free from synthetic chemical ingredients to protect their hair from
furtherdamage.
Multibenefithairstylingproductscontinuetoexperiencesalesgrowthin2012.
Hair styling products that offer multibenefits including protection for colored and
heattreatedhairsupportthecategorysgrowth.
In 2012, Unilever launches TRESemm Platinum Strength Heat Protect Spray that
fortifiesandstrengthenshair.
Productsextendingnourishingpropertiesareindemandfromconsumers.
Sales for the professional segment of hair styling products and sprays grow marginally in
2012.
Salesgrowby0.6%,from$500millionin2011to$503millionin2012.
Consumersareincreasingtheirsalonvisitscomparedtothepreviousyears.
However, consumers still remain watchful about the number of trips made to salons
fortheirhairstylingneeds.Furthermore,consumersseekouthairstylesthatareeasy
tohandleanddoesnotrequirefrequentsalontrips.
4A58
Technologicaladvancementsinotherhaircareproductcategories,suchasshampoosand
conditioners,offsetfurthergrowthinthecategory.
Afewshampoosandconditionerproducts,suchasvolumeandshineenhancing,affect
thegrowthofthehairstylingproductscategory.Asaresultofthis,volumeandshine
enhancingproductsinthecategoryareaffected.
TheincreasingagingpopulationintheUnitedStateslimitsthecategorysgrowth.
It is estimated that there are approximately 43 million baby boomers in the United
Statesin2012.
The elderly segment of the population does not consider hair styling products to be
important, as against the younger population. This is partly because younger
consumershaveacomparativelyhigherpropensitytomakestylestatementsandkeep
upwiththefashiontrends.
Thebabyboomerpopulationpreferstouselowpricedhairstylingproducts,ornone,
therebyaffectingthecategoryssalesvolumeandgrowth.
Notablenewproducts
Table4D27:SelectNewHairStylingProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Henkel
Got2B
TheGluedSpikingFreezespraycreateslonglastingstyle
Henkel
Got2B
TheKinkyCurlingMoussecreatescurlswithoutfrizz
Henkel
Got2B
TheGluedExtremeMoussecontainsaweightlessformulato
createmaximumvolumeattheroots
LOral
GarnierFructis
TheSpikeExplosionPowerGelcontainstaurineandcitrus
complex
LOral
GarnierFructis
TheDisorderhairgelcontainsnaturalingredientsincludingcitrus
LOral
GarnierFructis
TheCleanSleekPowerGelandPuttyprovidesultraslick,wet
shinelookforanyhairstylewith24hourhold
LOral
GarnierFructis
TheSufferHairPowerPuttycontainsnaturalingredients
includingcitrusandlemonextracts
LOral
GarnierFructis
TheMessMakerPowerGelandPowerPuttycontainsalight
formula
LOral
LOralParisEverStyle
CurlActivatingMoussecontainsaweightlessformula,natural
ingredients,andisfreefromalcoholandparabens
LOral
LOralParisEverStyle
CurlDefiningGelcontainsnaturalingredientsandisfreefrom
alcoholandparabens
LOral
LOralParisEverStyle
VolumeRootLiftingsprayis100%freefromdryingalcoholsand
containsnaturalingredients
(Continued)
4D59
4D60
Table4D27:SelectNewHairStylingProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Unilever
Axe
TheGravityDefyingDustgelcontainhumidityresistantformula
Unilever
Axe
ExtremeSpikeUpHoldSpraykeepsthespikesfortheentireday
Unilever
TRESemm
ThePlatinumStrengthHeatProtectSprayfortifiesand
strengthenshair
Unilever
TRESemm
KeratinSmoothHeatProtectionShineSprayhelpsshieldhair
fromthedamagingeffectsofheatstyling
Unilever
TRESemm
KeratinSmoothInfusingSmoothSerumhelpseliminatefrizzand
Illuminatesshine
Unilever
TRESemm
The24HourBodyhairspraycontainsasalonqualityformulathat
resistshumidityandfightsfrizz
Unilever
TRESemm
TheNourishingRitualsRejuvenatingMasquecontainsdeadsea
minerals
VogueInternational Organix
SmoothHydrationArganOil&SheaButterCurlEnhancingYogurt
smoothesandhydratesthickunrulycurlswithitsnongreasy,
hydratingformula
ThickandFullBiotin,CollagenRootBoostSpraycontains
proVitaminB7biotinwhichaddsextravolumetothehair
MoroccanSeaSaltSpraycontainsweightlessleaveinsurfmist
withtexturizingseasalt
Salesbyproducttype
Sales of hair sprays and spritzes grow 1.7% to reach $609million in 2012. The segment
accountsfor36.3%ofthecategoryssales,upfrom36.1%in2011.
Hair sprays, with innovative formulations and packaging designs, drive the segments
salesin2012.
UnileversTRESemmbenefitsfromitsnewPlatinumStrengthHeatProtectSpray.
Promotionalsupportintheformofadvertisementsforhairsprayssustainsthegrowth.
Gels experience a modest growth of 0.3% to reach $385million in 2012, up from

$384millionin2011.
Gelscontribute22.9%,downslightlyfrom23.2%ofthecategoryssalesin2011.
Thewidevarietyavailableingelsandmoussescontinuestocontributetotheirgrowth.
LOrallaunchesGarnierFructisSpikeExplosionPowerGelandUnileverlaunchesAxe
GravityDefyingDustgelin2012.
4A60
SalesforMoussesgrowslightlyby0.7%in2012from$153millionin2011to$154millionin
2012.
Newproductintroductions,suchasKinkyCurlingmousseandExtremeGluedmousse
supportthesegmentsperformancein2012.
Sales of treatments, volumizing products, and shine enhancers gain moderately, as they
haveacceptancefromconsumersoverawiderangeofages,fromthoseintheirearly20sto
thoseintheir50s.
Aswiththeentirecosmeticsandtoiletriesindustry,mensproductscontinuetoexperience
growth.
Mens products have a small sales base and its sales are estimated at $57million in
2012.
Salesareup1.8%from$56millionin2011.
Unilever with its Axe brand is the key marketer selling men specific hair styling
productsinthecategory.
Table4D28:ManufacturersSalesofHairStylingProductsintheUnitedStatesbyProductType,
2011and2012
$Million
Producttype
2011
2012
2012
Change,%
Spraysandspritzes
599
609
36.1
36.3
1.7
Gels
384
385
23.2
22.9
0.3
Mousses
153
154
9.2
9.2
0.7
Lotions,pomades,andglazes
118
119
7.1
7.1
0.8
Treatments
100
102
6.0
6.1
2.0
Retexturizingproducts
96
98
5.8
5.8
2.1
Shineenhancers
84
86
5.1
5.1
2.4
Hairvolumizersandthickeners
68
70
4.1
4.2
2.9
Mensgroomingproducts
56
57
3.4
3.4
1.8
1,658
1,680
100.0
100.0
1.3
Total
%Oftotal
2011
4D61
4D62
COMPETITION
Bycompany
Table4D29:ManufacturersSalesofHairStylingProductsandSpraysintheUnitedStatesbyCompany,
2011and2012
$Million
%Oftotal
Company
2011
2012
2011
2012
Change,%
Unilever
359
364
21.7
21.7
1.4
L'Oral
229
227
13.8
13.5
(0.9)
Procter&Gamble
227
222
13.7
13.2
(2.2)
Kao
75
77
4.5
4.6
2.7
EsteLauder
64
65
3.9
3.9
1.6
Henkel
59
60
3.6
3.6
1.7
56
56
3.4
3.3
589
609
35.5
36.3
3.4
1,658
1,680
100.0
100.0
1.3
Allother
Total
Unilevercontinuestobetheleadingmarketerinthehairstylingproductscategoryin2012.
Unilevers share remains at 21.7% of the categorys sales in 2012, unchanged from
2011.
SalesforUnilevergrow1.4%from$359millionin2011to$364millionin2012.
Thegrowthofthemarketerissupportedbynewproductactivityinthecategory.
Unilever launches several new products including, TRESemm Body Hair Spray, Axe
GravityDefyingDustgel,andAxeSpikedUpSpray.
TRESemmistheleadingbrandofthecompany,withsalesat$124millionin2012,up
7.8%from$115millionin2011.Thegrowthofthebrandissupportedbyseveralnew
product introductions by Unilever in 2012. Some of the key launches under the
TRESemmbrandincludePlatinumStrengthDeepConditioningtreatmentandKeratin
SmoothHeatProtectionShineSpray.
The secondleading brand of the marketer, Suaves sales decline by 1.7% in 2012 to
reach $59million from $60million in 2011. The brands biggest strength, economical
pricing,doesnotbenefitSuaveinthecategory.Inthehairstylingcategory,consumers
increasingly purchase products with better performance, keeping pricing as a
secondary factor. Furthermore, negligible traceable media expenditure (TME)
allocationatlessthanamillionandincreasingcompetitionfromotherleadingbrands
offsetsitssalesprospectin2012.
Limitednewproductactivityalsorestrictsthebrandsgrowthinthecategory.
SalesoftheAxebrandgrow3.8%from$26millionin2011to$27millionin2012.
In 2012, Unilever supports the brands sales with new product launches: Spiked Up
LookSpikingGlueandSpikedUpLookExtremeHoldingSpray.
Sales of Nexxus and Dove remain stagnant at $32million and $11 million in 2012,
respectively.
SalesofConsortdeclineby$1millionin2012to$11million,from$12millionin2011.
4A62
LOral is the secondleading marketer in the category with a category share of 13.5%,
downfrom13.8%in2011.
Salesforthemarketerdecline0.9%from$229millionin2011to$227millionin2012.
Decreaseinthemarketingandpromotionalactivitiescontributetothesalesdeclinein
2012.LOraldecreasesitsTMEspendbyapproximately35.7%,from$60.5millionin
2011to$38.9millionin2012.
GarnierFructisistheleadingbrandofthecompany,withsalesat$82millionin2012,
Despiteawiderangeofproductofferingsandwellestablishedpositioning,thebrand
declinesin2012.
Thebrandssalesdeclinein2012duetoadecreaseinmarketingactivities.
LOral is the leading marketer in the professional trade class in the category, with
RedkenastheleadingbrandfollowedbyMatrixinthirdposition.
Themarketeroccupies21.8%oftheprofessionaltradeclass,upfrom21.2%in2011.
Procter&Gamblecontinuestobeinthethirdpositioninthehairstylingproductscategory.
Salesofthemarketerdecrease2.2%to$222millionin2012from$227millionin2011.
Limited new product activity and a decrease in the marketing and promotional
activitiescontributetothesalesdeclineforthemarketerinthecategory.
Pantene ProV, the largest brand of the marketer in the category, remains the third
leadingbrandinthemasstradeclass.Salesofthebranddeclineto$61millionin2012,
down 12.9% from $70million in 2011. Limited new product activity and substantial
decrease in promotional activities offset the brands growth in 2012. The marketer
significantly decreases its TME support for the Pantene ProV brand in 2012 from
$34.6millionin2011to$10.1millionin2012.
SalesofHerbalEssencesgrowby5.7%to$56millionin2012,upfrom$53millionin
2011. Increasing promotional and marketing activity supports the brands growth in
2012.Procter&Gamblesupportsthebrandwithapproximately$6.8millioninTMEin
2012,upfrom$0.5millionin2011.
SalesofProcter&GamblesAussiedeclineby$1millionto$55millionin2012.
Procter & Gamble is present in the professional trade class with its Sebastian and
Nioxinbrands.In2012,themarketeroccupies9.4%oftheprofessionaltradeclass,up
from9.2%in2011.Sebastianisthesixthleadingbrandintheprofessionaltradeclass
with sales at $34million, down 2.9% from $35million in 2011. Procter & Gambles
other professional brand, Nioxin experiences growth in 2012. The brand grows by
4D63
4D64
RETAILDISTRIBUTION
In 2012, mass merchandisers continue to be the leading retail channel for hair styling
products.
Massmerchandisersaccountfor36.0%ofthetotalcategoryssalesin2012,unchanged
from2011.
Astheeconomycontinuestorecover,consumersseekvaluefortheirmoneyandseek
outletsofferingthebestprices.
Professional outlets continue to be the secondleading retail channel for hair styling
productswithacategoryshareof22.0%,unchangedfrom2011.
Table4D30:ManufacturersSalesofHairStylingProductsinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
36
37
Professionaloutlets
22
22
Drugstores
19
19
Foodstores
19
18
Specialtystores
Direct
Departmentstores
100
100
Total
MARKETINGACTIVITY
Televisionadvertisements,electronicandprintmediaadvertisements,couponing,andretail
activities are the prominent channels that marketers utilize to advertise their hair styling
products.
Print advertising, mainly magazines, remains the leading promotional method in the
category,followedbytelevisionadvertisements.
Marketersdeployprintadvertisementsastheycandisplaythewholearrayofproducts
offeredineachproductline.
Printadvertisementsalsofeaturevarioushairstylesachievedbyusingtheproducts.
Television advertising focuses on products targeted at younger consumers, and
marketerstrytoattractconsumerswithappealingaudiovisualelements.
Printadvertisingcontinuestobethemostutilizedchannelaccountingfor$80.7million
inTMEin2012,followedbytelevisionadvertisingwith$66.3million.
4A64
Couponsremainanimportantpromotionalmediumformarketersinthecategory.
Couponsaredistributedthroughfreestandinginserts(FSIs)inmagazinesandweekend
newspapers.
Marketers often attempt to entice consumers to try new products with coupons.
Couponsrangefrom$1.00toashighas$3.00,dependingonthepriceoftheproduct.
Marketers,suchasUnileverandProcter&Gambleoffercouponsworth$1.00ontheir
websitesfortheirhairstylingproducts.
In addition to FSIs, the leading marketers also promote their brands through
downloadablecouponsontheirwebsites.
Most major marketers including Unilever and L'Oral utilize social media and videos to
promotetheirscents.
To reach younger and more technologically savvy consumers, brands are using the
Internetandsocialmedia.
Themarketersusesocialmediasites,suchasFacebookandTwittertoshareupdated
informationonproducts,launches,andcoupons.
Several leading marketers provide hair styling tips and other product benefits on their
websites.
Unilever, through its TRESemm brand website provides hair styling tips and hair
stylingnewstoengageconsumerswiththelateststylingtrends.
L'Oral,throughitsGarnierwebsite,suggestssuitablehairstylesforaconsumerbased
ontheirhairtype.
Marketers in the hair styling category promote products based on two factors: target
consumergroupsandthevarietyofproductsoffered.
Hair spraysare the most predominantly advertised hair styling product in magazines,
suchasGlamour,Allure,andCosmopolitan.
Television advertisements are the most preferred for styling products that target
youngerconsumers.
Hairspraysareadvertisedasapartoftheirhaircarelinesthatfeatureshampoosand
conditioners.
Due to the variety in styling products available, promotions are through exclusive
campaignspromotingtherangeofstylingproductsunderabrand.
Hair styling products receive a TME of $164.9 million in 2012, down 30.3% from
Print advertising remains the most favored mode of advertising hair styling products,
accountingfor48.9%or$80.7millionofTMEin2012.
4D65
4D66
Unilever is the leading advertiser with a TME of $39.2 million in 2012, down from
$55.7millionin2011.
DoveStyleCarerangeisthehighestadvertisedhairstylingvariantfromUnilever,with
aTMEsupportofover$17.6millionin2012.
Dove gets a TME support of $22.5 million or 57.3% of the marketers advertising
expenditurein2012.
Axe receives only $5.4 million or 13.7% of the marketers advertising expenditure in
2012.
In 2012, LOral is the second largest advertiser in the category, with a TME of almost
$38.9million,downfrom$60.5millionin2011.
TheTMEisspreadmainlybetweentelevisionandmagazinesadvertisements.
Television and magazine advertising collectively account for more than 92% or
$35.8millionofTMEin2012.
LOral Paris EverStyle variant receives the singlelargest TME support at almost
$11.4millionin2012.
GarnierFructisStyleSleekFinish,astylingsprayvariant,garnersalmost$10.2millionin
TMEin2012,spreadacrossmagazinesandtheInternet.
Procter&GambleisthethirdleadingadvertiserinthecategorywithaTMEof$27.7million
in2012,downfrom$55.4millionin2011.
The marketer drops its TME significantly by 50.0%, from $55.4 million in 2011 to
$27.7millionin2012.
Procter & Gamble allocates $13.7 million or 49.4% of its TME through television
advertisements followed by $11.7 million or 42.2% of its TME through magazine
advertisements.
PanteneProVlinereceivesatotalTMEsupportofapproximately$10.1millionin2012,
spreadprimarilyacrosstelevisionandmagazineadvertising.TheTMEsupportforthe
branddecreasesby70.8%in2012from$34.6millionin2011.
FurtherdetailsonTMEcanbefoundintheAdvertisingsectionofthisreport,aswellasin
thedatabase.
OUTLOOK
The category is forecast to grow at a moderate rate of 1.4% during the forecast period,
2012to2017.
Hair styling products with better formulations and innovative packaging will perform well
throughtheforecastperiod.
Manufacturersofhairstylingproductswillcontinuetoincorporatenewformulations
totheirexistingproductsaswellasnewproductstosupportthecategorysgrowth.
Severalleadingmanufacturers,suchasUnileverandL'Oral,areexpectedtoupgrade
theirproductpackagingwithnewdesignstoattracttheirtargetaudiences.
4A66
Manufacturers will continue to introduce hair styling products with multibenefits to

supportthecategorysgrowthovertheforecastperiod.
Hairstylingproductsthatoffermultibenefitsforcoloredandtreatedhairarelikelyto
dowellduringtheforecastperiod.
Hairstylingproductsthatwillprotecthairscalphealthareexpectedtoperformbetter.
As consumers increasingly want to protect their hair from the harmful UV rays,
manufacturersareexpectedtolaunchsuncarehairstylingproductsovertheforecast
period.
Marketers are expected to introduce products targeted at men, as the mens segment is
expectedtoperformwellovertheforecastperiod.
Several leading marketers including Unilever and Henkel introduce menspecific hair
productsin2012andareexpectedtocontinueintroducingmoremalecentricproducts
duringtheforecastperiod,2012to2017.
Marketers are expected to develop products that cater to mens needs including
masculineformats,fragrances,andpackaging.
Manufacturerswillcontinuetoincorporatenaturalingredientsintheirproductstosupport
thecategorysgrowththrough2017.
With increasing awareness about the harmful chemicals contained in hair styling
products, consumers have become mindful of the products they use and would
increasinglyoptfornaturalandorganicproductsoverregularhairstylingproducts.
The sales of professional hair styling products are expected to grow moderately over the
forecastperiod.
As the economy recovers, consumers are likely to take home more products from
salons,supportingthecategorysgrowthintheprofessionalchannel.
Higher price points of professional brands as compared with mass brands would add
moresalesvaluetothecategory.
Sales of hair styling products are projected to increase at a CAGR of 1.4% to reach
Unit volume of the category is forecast to increase at a CAGR of 1.0% over the forecast
periodtoreach555.2millionpackagesin2017,upfrom528.7millionpackagesin2012.\
4D67
4D68
4A68
SHAMPOOS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturers sales in the category grow 4.8% from $2,501million in 2011 to

Saleshaveincreasedatacompoundannualgrowthrate(CAGR)of2.5%from2007.
Table4D31:HistoricalSalesofShampoosintheUnited
States,2007to2012
Year
$Millionr
Change,%
2007
2,311
2008
2,307
(0.2)
2009
2,276
(1.3)
2010
2,361
3.7
2011
2,501
5.9
2,620
4.8
2012
rRestated.
Unitsales
Unit sales in the category grow 3.8% from 714million packages in 2011 to 741million
packagesin2012.
Retailsales
Retailsalesofshampoostoconsumersareestimatedat$3,843.6millionin2012,up4.9%,
from$3,665.2millionin2011.
4D70
Shampoos
Table4D32:ManufacturersSalesofShampoosintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
MASS
Head&Shoulders
Procter&Gamble
244
266
12.1
12.8
9.8
10.2
PanteneProVr
Procter&Gamble
259
255
12.8
12.3
10.4
9.7
Suave
Unilever
186
193
9.2
9.3
7.4
7.4
GarnierFructisr
L'Oral
136
134
6.7
6.5
5.4
5.1
HerbalEssencesr
Procter&Gamble
130
132
6.4
6.4
5.2
5.0
TRESemmr
Unilever
120
117
5.9
5.6
4.8
4.5
Dove
Unilever
76
72
3.8
3.5
3.0
2.7
Neutrogena
Johnson&Johnson
53
54
2.6
2.6
2.1
2.1
PertPlusr
HelenofTroy
55
50
2.7
2.4
2.2
1.9
Aussie
Procter&Gamble
46
48
2.3
2.3
1.8
1.8
AlbertoVO5r
BrynwoodPartners
44
45
2.2
2.2
1.8
1.7
Organixr
VogueInternational
29
45
1.4
2.2
1.2
1.7
Nexxus
Unilever
40
41
2.0
2.0
1.6
1.6
Axer
Unilever
44
40
2.2
1.9
1.8
1.5
SelsunBlue
Sanofi
36
36
1.8
1.7
1.4
1.4
Johnson'sBaby/Kids
Johnson&Johnson
37
35
1.8
1.7
1.5
1.3
SuaveforMen
Unilever
34
33
1.7
1.6
1.4
1.3
Clear
Unilever
30
1.4
1.1
EverPurer
L'Oral
18
19
0.9
0.9
0.7
0.7
Aveenor
Johnson&Johnson
17
19
0.8
0.9
0.7
0.7
SheerBlonder
Kao
17
17
0.8
0.8
0.7
0.6
Gillette
Procter&Gamble
16
17
0.8
0.8
0.6
0.6
Finesser
Lornamead
17
16
0.8
0.8
0.7
0.6
BrilliantBrunette
Kao
14
14
0.7
0.7
0.6
0.5
VivePror
L'Oral
16
13
0.8
0.6
0.6
0.5
Infusium23
HelenofTroy
14
12
0.7
0.6
0.6
0.5
Fekkai
Procter&Gamble
10
12
0.5
0.6
0.4
0.5
EverSleek
L'Oral
10
10
0.5
0.5
0.4
0.4
WhiteRain
BrynwoodPartners
11
0.5
0.4
0.4
0.3
EverStrongr
L'Oral
0.4
0.4
0.4
0.3
Prell
PrestigeBrands
0.3
0.4
0.3
0.3
SelsunBlueNaturals
Sanofi
0.3
0.3
0.3
0.3
EverCreme
L'Oral
0.3
0.3
RootAwakening
Kao
0.4
0.3
0.4
0.2
L'OralKidsr
L'Oral
0.3
0.3
0.2
0.2
NizoralADr
Johnson&Johnson
0.3
0.2
0.2
0.2
Burt'sBeesr
TheCloroxCompany
0.1
0.2
0.1
0.2
Denorexr
PrestigeBrands
0.2
0.2
0.2
0.2
RadiantRed
Kao
0.2
0.1
0.2
0.1
(Continued)
4A70
4D71
Shampoos
Table4D32:ManufacturersSalesofShampoosintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
MASS(Continued)
Jhirmack
0.1
0.1
0.1
0.1
Ultraswim
Sanofi
0.1
0.1
0.1
0.1
Freeman
FreemanBeauty
Got2B
Henkel
Sunsilk
Unilever
0.1
0.1
Allother
Henkel
90
82
4.5
3.9
3.6
3.1
Privatelabel
Allother
Total
134
147
6.6
7.1
5.4
5.6
2,108
2,077
100.0
100.0
80.7
79.3
PROFESSIONAL
PaulMitchell
JohnPaulMitchell
Systems
57
57
15.7
15.4
2.3
2.2
Matrix
L'Oral
46
47
12.7
12.7
1.8
1.8
Aveda
EsteLauder
33
34
9.1
9.2
1.3
1.3
Redken
L'Oral
29
30
8.0
8.1
1.2
1.1
Nioxin
NioxinResearch
Laboratories
27
29
7.4
7.9
1.1
1.1
TIGI
Unilever
20
20
5.5
5.4
0.8
0.8
Bumbleandbumble
EsteLauder
17
18
4.7
4.9
0.7
0.7
Pureology
L'Oral
14
13
3.9
3.5
0.6
0.5
Joico
Shiseido
2.5
2.4
0.4
0.3
Alterna
TSG
1.9
2.2
0.3
0.3
Sebastian
Procter&Gamble
1.9
1.6
0.3
0.2
Zotos
Shiseido
1.7
1.6
0.2
0.2
Allother
Total
91
92
25.1
24.9
3.6
3.5
363
369
100.0
100.0
14.5
14.1
DIRECT
Wen
GuthyRenker
60
112
74.1
84.8
2.4
4.3
Avon
Avon
17
15
21.0
11.4
0.7
0.6
4.9
3.8
0.2
0.2
81
132
100.0
100.0
3.2
5.0
Allother
Total
SPECIALITY
Bath&BodyWorks
LimitedBrands
12
13
50.0
48.1
0.5
0.5
Victoria'sSecret
LimitedBrands
29.2
25.9
0.3
0.3
Crabtree&Evelyn
Crabtree&Evelyn
4.2
3.7
16.7
22.2
0.2
0.2
24
27
100.0
100
1.0
1.0
Allother
Total
LUXURY
Origins
EsteLauder
26.7
26.7
0.2
0.2
11
11
73.3
73.3
0.4
0.4
100.0
0.6
0.6
100.0
100.0
Allother
Total
15
15
TOTAL
2,501
2,620
100.0
4D72
Shampoos
CATEGORYDEVELOPMENT
Markettrends
Salesofshampoosgrow4.8%in2012.
Several leading marketers including L'Oral and Unilever launch new range of
shampoos,supportingthecategorysgrowth.
Antidandruffshampooscontinuetoseegoodgrowthin2012.
Brands, such as Head & Shoulders (Procter & Gamble) grows 9.0% and jumps to the
leading spot in the category; the growth of the brand is significantly higher than the
categorysgrowthof4.8%.
Shampoosthatpromotescalphealthgarnerattentionin2012.
Marketers that introduce scalp care products perform well in 2012, supporting the
overallcategorysgrowth.
For example, Unilever benefits from the introduction of its scalp therapy range of
shampoosunderitsClearbrandin2012.
The range includes Scalp Therapy Lengths Nourishing shampoo, Complete Care Anti
dandruffshampoo,andUltraSheaCleansingshampoo.
TheClearbrandhassalesof$30millioninitsfirstyearoflaunch.
Shampoosthatoffermultiplebenefitssupportthecategorysgrowth.
Consumers are looking for functional benefits in their shampoos beyond the basic
cleansingandnourishingproperties.
Marketers incorporating more functional benefits, such as frizz protection and anti
agingperformwellinthecategoryin2012.
Unilever launches Nexxus Frizz Defy Frizz Protection shampoo in 2012 that contains
frizzdefyingtechnologyandMorroccanarganoil.
In2012,Procter&GamblelaunchesPanteneAgeDefyshampoothatworkstogetherto
helphairactupto10yearsyoungerbythickeningexistinghairstrands.
Shampoos that provide protection for colored hair and colorenhancement for hair
contributetothecategorysgrowth.
Thegrowingnumberofconsumerswhocolortheirhairsupportsthegrowthofcolor
protectionshampoos.
SeveralleadingmarketersincludingKaoandL'Orallaunchcolorprotectionandcolor
enhancementshampoossupportingthecategorysgrowth.
KaolaunchesitsColorCarerangeofshampoosunderitsGoldwellbrandin2012.
Shampoosthatcatertotheneedsofvarioushairconcerns,suchasthinning,volumeboost,
andhairtypescontinuetoperformwellin2012.
In 2012, Pantene ProV (Procter & Gamble) introduces the Pantene ProV Daily
MoistureRenewal,whichissuitableforbothmediumandthickhairtypes.
4A72
Shampoos
Marketers continue to incorporate natural ingredients in their hair care products as

consumersseekproductsthatarefreefromchemicalingredients,suchassulfate.
Several leading marketers, such asVogue International and Procter & Gamble launch
products with natural ingredients or enhance their existing products with natural
ingredientstosupportthecategorysgrowth.
Naturallypositioned brands, such as Organix perform well in 2012, with sales
increasingat55.2%from$29millionin2011to$45millionin2012.
VogueInternationalandTheCloroxCompanylaunchtheirrangeofnaturalshampoos,
which contain natural ingredients claimed to be beneficial for consumers with hair
problemsincludingthinninghair.VogueInternationallaunchestheKeratinOilrangeof
shampoos.
Increasing new product activity in the category contributes to the sales growth in the
categoryin2012.
Several leading marketers including Unilever and Procter & Gamble launch their new
rangeofshampoosin2012.
UnileverintroducesitsnewClearrangeofshampoosinearly2012.Therangeincludes
scalptherapyandtotalcareshampoos.
Procter & Gamble extends its Head & Shoulders line of antidandruff shampoos with
newvariantsincludingClinicalStrengthantidandruffshampoo.
Significantmarketingsupportandpromotionalactivitiesalsosupportthecategorysgrowth.
Several leading marketers including Unilever and L'Oral support their brands with
hugetraceablemediaexpenditures(TME)inordertogrowtheirmarketsharesinthe
category.
In 2012, TME for shampoos total $446.3million, up significantly by 27.0% from
Menspecific hair care products continue to gain importance in 2012, supported by new
productlaunches.
Several leading marketers including Unilever and L'Oral launch products targeted at
menin2012.
UnileverlaunchesClearMenrangeofshampoosin2012.
Unilever also extends its Suave for Men range with new variants, such as Suave for
Men Deep Cleansing shampoo. L'Oral extends its Redken for Men range with new
variants.
Theprofessionalshampooscategoryexperiencesmoderategrowthof2.1%in2012.
Astheeconomyrecovers,consumersareslowlyincreasingtheirsalonvisits.
4D73
4D74
Shampoos
Thesalesofshampoosinthedirecttradechannelpostsignificantgrowthof63.0%in2012,
supportedbythestrongperformanceofthebrand.
Wenpostssignificantgrowthof86.7%inthecategory,upfrom$60millionin2011to
$112millionin2012.
Wen is positioned as a fiveinone product, replacing shampoos, daily conditioner,
detangler, deep conditioner, and leavein conditioner supporting its growth in the
category.
Notablenewproducts
Table4D33:SelectNewShampoosIntroducedintheUnitedStatesin2012
Company
Brand
Description
Aesop
BlackLabel
Calmingshampoocontainsblendedbotanicaloils,vegetable,andsynthetic
proteins
EsteLauder
Bumble&Bumble
ColorMindedshampooisinfusedwithdualpolymertechnologythatis
designedtomakehairimpermeabletowater,reducingbothcolorwashout
andfading
HainCelestialGroup
QueenHelene
SoftTwirlsshampoocontains17aminoacids,plusvitaminsA,B,C,DandK,
thepresenceofwhichdeliverssmoothinghydrationtocurls
JohnPaulMitchell
Systems
PaulMitchell
SpringLoadedDetanglingshampoodetangles,cleanses,andconditionsallat
once
Johnson&Johnson
Aveeno
PureRenewalshampoorefresheshairwithoutwaterforacleanandhealthy
lookbetweenwashes
Johnson&Johnson
Neutrogena
CleanReplenishingshampoogentlycleanseshairanditsmoistureenriched
formulaprovidesalldaymoisturization
Johnson&Johnson
Neutrogena
TripleMoistureCreamLathershampoocontainsthreenaturallyderived
extractsthatpenetratetofightdrynessonallthreedimensionsofthehair
strand,asidefromcombatingfrizz
Johnson&Johnson
Neutrogena
TripleRenewalVolumeBoostingshampooisinfusedwithaminoacids,
vitamins,andnaturallyderivedproteins
Johnson&Johnson
Neutrogena
AntiResidueshampooisatreatmentthatinstantlycleanseshair,rendering
thestrandscleanandresiduefree
Johnson&Johnson
Neutrogena
Cleanvolumeshampoogentlycleansesandaddsbodytoflatandlifeless
hair
Kao
Goldwell
FadeStopshampoo,withitsuniqueFadeStopformulawithpomegranate
essencepreventsminimalcolorfading
LOral
LOralParis
TotalRepair5Restoringshampoohelpsrepairfivevisiblesignsofdamaged
hairsplitends,weakness,roughness,dullness,anddehydration
LOral
LOralParis
TripleResistReinforcingshampooinstantlyhelpsnourishhairfromrootto
coretotip,therebystrengtheninghair
LOral
LOralParis
SmoothIntensePolishingshampoosoftenshairandcombatssymptomsof
roughtextures,leavinghairsmooth
(Continued)
4A74
Shampoos
Company
Brand
Description
LOral
GarnierFructis
GarnierFructisPureCleanshampoobooststhehealthofhairandscalp,and
containsabiodegradableformulafromFructis
LOral
Matrix
BlondeCareshampoocontainsablendofchamomileandpanthenol
LOral
EverCreme
TheIntenseNourishingshampoocontainsnaturalbotanicalsandisfree
fromsulfatesandparabens
M&MCosmetics
Sofnfree
NothingButClarifyingShampoocontainsvariouscombinationsofoilsfrom
sheabutter,coconut,jojoba,soyabean,wheatgerm,teatreeoil,vitaminE,
keratin,andnaturallyderivedfragrances
NaturesGate
NaturesGate
BabySoothingshampoo&washcleansesfinehairandsoothesdelicateskin
withmildherbs,infusedwithbabybotanicalsincludingjojobaoil,sweet
almond,andvegetableglycerin
Procter&Gamble
HerbalEssences
TheHoneyImStrongshampooisinfusedwithhoney
Procter&Gamble
Head&Shoulders
TheClinicalStrengthAntidandruffshampoohelpspreventitching,scaling,
irritation,andrednessassociatedwithseborrheicdermatitisanddandruff
Procter&Gamble
Head&Shoulders
DamageRescueDandruffshampoonourishesdamagedhairandhelps
relievedryscalp
Procter&Gamble
PanteneProV
PanteneAdvancedandKeratinRepairshampoofeaturesadvanced
technologytohelprestoresmoothnessofextremelydamagedhair,while
preventingfurtherdamageatthekeratinlevel
Procter&Gamble
PanteneProV
TheDailyMoistureRenewalshampoocleansandprovidesanallday
moisturizationtothehair
Procter&Gamble
PanteneProV
PanteneAgeDefyshampooisclaimedtohelphairactupto10years
youngerbythickeningexistinghairstrands
TheCloroxCompany
BurtsBees
BabyBeeshampoocontainsnaturalplantbasedcleansingcomplexin
combinationwithsweetorangeandlemonoilstocreateanourishing
formulathatleavesbabyhairandskinsilkysoft
TheQuantumBeauty
Company
LeeStafford
BleachBlondeshampoocontainsproblondecomplexthathelpskeephair
clean,andkeepsblondehairbright,fresh,andhealthy
Unilever
Axe
Apollo2in1shampooandconditionerhasfruitscentthatthecompany
claimsisuniqueandmasculine
Unilever
Dove
TheDamageSolutionsColorCareshampoocleansandconditionscolor
treatedhair
Unilever
Clear
ScalpTherapyStrongLengthsNourishingshampoocontainsstrengthening
serumandisformulatedwithNutrium10,amoisturecomplexofvitamins
andnutrients
Unilever
Clear
ScalpandHairTherapyCompleteCareAntiDandruffshampoonourishes
deeplyandhelpseliminatedandruffsymptoms,leavingthescalphealthy
Unilever
Clear
ScalpandHairTherapyUltraSheaCleanseandNourishShampooisenriched
withsheabutterandnaturaloilsthathelpslockmoistureintodryscalpsand
leaveshairstrongandbeautiful
Unilever
Clear
ScalpandHairTherapyTotalCareNourishingShampoocontains10
nutrientsandvitaminsthatnourishesscalpforstrong,beautifulhair
(Continued)
4D75
4D76
Shampoos
Company
Brand
Description
Unilever
Clear
ScalpandHairTherapyDamage&ColorRepairNourishingShampoois
speciallyformulatedtonourishthescalpdeeply,creatingtheright
foundationforstrong,beautifulhair
Unilever
Clear
ScalpandHairTherapyFrizzControlNourishingShampooprovidefrizz
controlandnourishesthehair
Unilever
ClearMen
ScalpTherapy2in1AntiDandruffShampoocontainsGinseng,mint,andtea
tree
Unilever
ClearMen
ScalpTherapyDailyStrongandFullAntiDandruffShampoocontainsBio
Nutrium10,ablendof10nutrientsandbotanicalactivestonourishdeeply
Unilever
ClearMen
ScalpTherapyClean&RefreshAntiDandruffDailyShampoohelpseliminate
dandruffsymptomsatthesourcewithpyrithionezinc
Unilever
ClearMen
ScalpTherapyCoolSportMintAntiDandruffDailyShampoocontainsnatural
mintandCleansesscalpandhair,leavinganextracoolingsensation
Unilever
ClearMen
ScalpTherapy2In1DryScalpHydrationAntiDandruffShampoogently
cleansesandconditionstoleavehairmanageablewithadeepclean
sensation
Unilever
Suave
DailyclarifyingshampooisapHbalancedshampoo,thathasnewformula
forlongerlastingfragranceandissuitableforbothnormalaswellasoily
hair
Unilever
TRESemm
TheSplitRemedyshampoocontainsamoisturizingformulathatgently
cleansesandstrengthenshair
VogueInternational
Organix
MoroccanArganOilshampooisfreeofsulfatesandparabens,penetrates
hairshaftrestoringshineandsoftnesswhilestrengthening
VogueInternational
Organix
KeratinOilshampoofightssplitendsandflyaways,whilestrengtheninghair
andrestoringitsbeauty
VogueInternational
Organix
CitrusMintshampoothickensandtexturizeshairwhilestimulatingscalp
M&Aactivity
In 2012, Brynwood Partners acquires the brand White Rain from Sun Products for an
undisclosedprice.
White Rainis sold in the topthreecategories in the hair care product class including
shampoos,conditioners,andhairstylingproducts.
ThisdealisexpectedtostrengthenthepositionofBrynwoodPartnersinthehaircare
productclass.
4A76
Shampoos
Salesbytradeclass
Thecategoryisdominatedbymassproducts,whichaccountfor79.3%oftheoverallsalesin
2012.
Specialtyandluxuryarethesmallesttradeclasses,accountingfor1.0%and0.6%ofthe
categoryssales,respectively,in2012.
Sales in the direct trade class grow significantly by 63.0% in 2012, mainly driven by
GuthyRenkersbrandWen,salesofwhichgrow86.7%in2012.
Table4D34:ManufacturersSalesofShampoosintheUnitedStatesbyTradeClass,2011and2012
Tradeclass
Massmerchandisers
Professionaloutlets
Directsales
Specialtystores
Luxurystores
Total
$Million
2011
2012
2,018
2,077
363
369
81
132
24
27
15
15
2,501
2,620
%Oftotal
2011
2012
80.7
79.3
14.5
14.1
3.2
5.0
1.0
1.0
0.6
0.6
100.0
100.0
Change,%
2.9
1.7
63.0
12.5
4.8
COMPETITION
Bycompany
Table4D35:ManufacturersSalesofShampoosintheUnitedStatesbyCompany,2011and2012
Company
Procter&Gamble
Unilever
LOral
Johnson&Johnson
GuthyRenker
HelenofTroy
EsteLauder
BrynwoodPartners
Sanofi
VogueInternational
Privatelabel
Allother
Total
$Million
2011
2012
712
736
523
546
284
287
113
113
60
112
69
62
57
57
54
56
55
53
45
45
29
45
90
82
410
426
2,501
2,620
%Oftotal
2011
2012
28.5
28.1
20.9
20.8
11.4
11.0
4.5
4.3
2.4
4.3
2.8
2.4
2.3
2.2
2.2
2.1
2.2
2.0
1.8
1.7
1.2
1.7
3.6
3.1
16.4
16.3
100.0
100.0
Change,%
3.4
4.4
1.1
86.7
(10.1)
3.7
(3.6)
55.2
(8.9)
3.9
4.8
4D77
4D78
Shampoos
Procter&Gamblecontinuestobetheleadingmarketerintheshampooscategoryin2012.
Salesofthemarketergrow3.4%in2012from$712millionin2011to$736millionin
2012.
Procter&Gamblehasa28.1%marketshareoftheoverallcategoryssalesin2012.
The company markets seven brands in the category, including the top two brands
PanteneProVandHead&Shoulders.
Head&Shouldersbecomesthecategoryleaderin2012,displacingPanteneProV.
Head&Shoulderssalesgrow9.0%,from$244millionin2011to$266millionin2012.
Thebrandsgrowthisdrivenbyimprovedmarketingandpromotionalactivitiesinthe
category.
Procter & Gamble launches various campaigns to support the sales of its Head &
Shouldersbrandinthecategory.Themarketersigns soccerplayerLionelMessiasits
spokespersontopromoteitsHead&Shouldersbrand.
Consumers seek products which provide further functional benefits as compared to
regularshampoos,contributingtoHead&Shouldersgrowth.
PanteneProV,thesecondleadingbrandinthecategory,hasacategoryshareof9.7%
in2012,downfrom10.4%in2011.
Sales for the brand decline by $4million to $255million in 2012, down from
$259millionin2011.
Pantene ProV has limited new product activity in 2012 compared to 2011, when
Procter&GambleaddedanumberofproductstothePanteneProVline.
Head&ShouldersfromProcter&Gambleholdsthefirstpositionwith10.2%shareinthe
category.
Head&Shouldersdominatestheantidandruffsegmentofshampoos.
Head&ShouldersaddsaClinicalStrengthantidandruffshampootoitslinein2012.
In2012,thesalesofHerbalEssencesfromProcter&Gamblegrowmarginallyby1.5%,from
HerbalEssencesisthefifthlargestbrandintheentireshampooscategory.
Newproductlaunchesandthesuccessofnaturalproductssupportthebrandsgrowth
in2012.
The marketer introduces Herbal Essences Honey Im Strong line of strengthening
shampoosin2012.
4A78
Shampoos
SalesforProcter&Gamblesothermassbrandsshowadecentperformancein2012.
Aussieexperienceshealthygrowth,withsalesincreasing4.3%from$46millionin2011
to $48million in 2012. Strong promotional activities and new product formulations
contributetothebrandsoverallperformance.Thesuccessofnaturalproductssupport
thebrandsgrowth,asAussiesproductscontainAustralianWildPeachandAustralian
KangarooPawFlowerextracts.
Gillettesshampoosalesgrow6.3%in2012from$16millionin2011to$17millionin
2012.Bettermarketingandpromotionalactivitycontributestothebrandsgrowth.The
marketer allocates approximately $5.1 million to promote the brand in 2012, up
significantlyfrom$0.5millionin2011.
Procter&Gamblemarketsoneprofessionalbrandinthecategory,Sebastian.
SalesofSebastiandecline14.3%from$7millionin2011to$6millionin2012.
Procter & Gamble is struggling to make Sebastian products appealing to its target
youngerconsumersegment
Unilever, the secondleading marketer in the category, has a 20.8% category share. The
salesofthecompanygrow4.4%,from$523millionin2011to$546millionin2012.
SuavecontinuestobetheleadingbrandofUnilever;andisthethirdlargestbrandin
thecategory.Salesofthebrandareup3.8%,from$186millionin2011to$193million
in2012.NewproductactivityandincreasedmarketingcontributetotheSuavebrands
performanceinthecategory.UnileverlaunchesSuaveProfessionalMoroccanInfusion
range of shampoos to support its growth in the category. However, sales for Suaves
mensvariant,SuaveforMen,declinemoderatelyby2.9%from$34millionin2011to
$33millionin2012.
ThesecondlargestbrandfromUnileverisTRESemm.Thebrandssalesdecline2.5%
from $120million in 2011 to $117million in 2012. Limited promotional activities
contributetothebrandssalesdeclineinthecategory.
Dove,thethirdlargestbrandfromUnilever,declines5.3%from$76millionin2011to
$72millionin2012.Limitednewproductactivitycontributestothebrandsdeclinein
2012.TheonlysignificantproductlaunchfromDovein2012isDamageSolutionsColor
CareShampoo.
Unileverlaunchesanewbrand,Clearinthecategoryin2012.Thebrandexperiences
sales of $30 million in its first year of launch. Significant marketing and promotional
activity supports the brands performance in the category. The marketer allocates
approximately$58.5milliontopromoteitsClearbrandin2012.
UnileverdiscontinuesitsSunsilkbrandin2012.
4D79
4D80
Shampoos
LOralisthethirdlargestmarketerinthecategorywitha11.0%share;thecompanyssales
grow1.1%from$284millionin2011to$287millionin2012.
Thecompanyoffers10brandsinthecategory.
Garnier Fructis is the leading brand from LOral, and sales decline 1.4%, from
$136millionin2011to$134millionin2012.Limitednewproductactivityoffsetsthe
brandsgrowthinthecategory.
ThesalesofEverPuregrow3.3%,from$18millionin2011to$19millionin2012.The
successofsulfatefreeshampoossupportthebrandssalesinthecategory.
ViveProfromLOralcontinuestodeclinein2012;salesforthebranddecline18.8%,
from $16million in 2011 to $13million in 2012. Limited distribution and lack of new
productactivityaffectsthebrandsperformance.
LOralsuccessfullylaunchesEverCremein2012,acleansingconditionerorrather
a conditioning shampoo that doesnt foam to compete with Wen brand. Sales are
approximately$7millioninitsfirstyear.
LOral markets two professional hair care brands: Matrix and Redken. Matrix
witnessesa2.2%growthin2012,withthebrandssalesincreasingfrom$46millionin
2011 to $47million in 2012. The brands growth is supported by new product
introductionin2012.LOrallaunchesanewBlondeCareshampooundertheMatrix
brand in 2012. Redken grows 3.4% from $29million in 2011 to $30million in 2012.
RedkenlaunchesAllSoftandBlondeGlamshampoosin2012.
Johnson&Johnson,thefourthrankedmarketer,hasa4.3%shareinthecategoryssales.
Salesforthecompanyareflatat$113millionin2012,sameas2011levels.
Thecompanyoffersfourbrandsinthecategory.
Neutrogena,theleadingbrandfromJohnson&Johnson,grows1.9%from$53million
in2011to$54millionin2012.
Significant product launches under Neutrogena in 2012 are Clean Replenishing
shampooandTripleMoistureCreamLathershampoo.
Johnson'sBaby/Kidsbrandexperiencesadeclineof5.4%,from$37millionin2011to
$35millionin2012.
Sluggishsalesinthechildrensandbabieshaircaresegmentnegativelyaffectthesales
oftheJohnson'sBaby/Kidsline.
The sales of Wen (GuthyRenker) shampoos grow 86.7%, up from $60million in 2011 to
$112millionin2012.
ThecategoryshareofWengrowsfrom2.4%in2011to4.3%in2012.
Themarketercontinuestobenefitfromdirectlypresentingthebenefitsofitsproducts
toconsumersviainfomercials.
Moreover, Wen is positioned as a fiveinone product, replacing shampoos, daily
conditioner, detanglers, deep conditioner, and leavein conditioner. These factors
contributetoitshighprice.
ValuesalesarehighbecauseWencleansingconditionercostsabout$40.00abottle,and
the instructions mention that one must use a great deal more of the product than a
normalshampoo.Peopleorderingtheproductareautomaticallyenrolledinamonthly
subscription, with monthly charges made to their credit cards and product shipped
outmonthly.
WhileWenfacesrisingcompetitionfromLOralEverCremecleansingconditionerand
others,thegrowthisstillformidable.
4A80
Shampoos
Naturallypositionedproductsalsoseegoodgrowthinthecategory.
Organix, a naturallypositioned brand from Vogue International, grows 55.2% from
Betterperformanceofnaturalproductscontributetothebrandsgrowthin2012.
VogueInternationalextendsitsOrganixbrandwithArganOilSheaButtershampooand
ThickeningCitrusMintshampooin2012.
Privatelabel
Salesofprivatelabelproductsdecline8.9%from$90millionin2011to$82millionin2012.
ArecoveringeconomyintheUnitedStatescontributetothesalesdipforprivatelabel
productsasconsumerstradeuptonationalbrandswithbetterbenefits.
Thetechnologicaladvancementsandspecializedingredientsintheheavilyresearched
nationalbrandsrendercompetitionfromplainerprivatelabelproductslessenticing.
RETAILDISTRIBUTION
Massmerchandiserscontinuetoleadthecategoryastheleadingretaildistributionchannel,
witha41%shareofthecategoryssales.
Drugstoressharedeclinesfrom14%in2011to13%in2012.
However, food stores experience a decline of 100 basis points as consumers
increasinglyvisitmassmerchandisers.
The direct channel grows from 4% in 2011 to 6% in 2012, supported by the positive
performanceoftheWenbrand.
Table4D36:ManufacturersSalesofShampoosintheUnited
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
39
41
Foodstores
24
23
Drugstores
14
13
Professionaloutlets
13
11
Specialtystores
Directsales
Departmentstores
100
100
Total
4D81
4D82
Shampoos
MARKETINGACTIVITY
Aggressivemarketingandpromotionalactivityisthebiggestgrowthdriverforarelatively
matureshampooscategory.
Television and print media continue to be the most preferred channel for advertising of
shampooproducts.
Several leading marketers including Procter & Gamble and Unilever promote their
leadingbrandsthroughtelevisionandmagazines.
Marketersbundletheirentirehaircareproductlineincludinghairstyling,conditioners,
andhaircoloringasacompleteproductset.
Discountcouponsandpricebasedpromotionsarealsoimportantmeansofpromotingthe
salesofshampoos.
Discount coupons are distributed through magazines, the Internet, and freestanding
inserts(FSIs).
includingLOralandProcter&Gamble.
Marketers continue to attract consumers through pricebased promotions, as this is
oneofthekeyfactorswhichinfluenceconsumerstotrynewproducts.
Marketers also provide discounts and buyonegetonefree promotions for brands
whosesalesaredeclininginordertokeepuptheirshare.
Several leading marketers, such as Unilever and Procter & Gamble provide cash nd
discountcouponsthroughtheirwebsitetosupportthesalesfortheirrespectivebrands.
Marketersprovidefreesamplestosupportthesalesoftheirnewproductsaswellastheir
underperformingproducts.
Marketers provide free samples on new product launches in order to encourage
consumerstotrythem.
Procter&GambledistributesitsnewTRESemmSplitRemedyshampoosin2012.
MarketerscontinuetorelyontheInternetandsocialmediasites,suchasFacebook,Tumblr,
Pinterest,andTwitter,topromoteandadvertisetheirproducts.
Presence on the social networking websites is an economical means to stay in touch
withexistingandpotentialcustomers.
New product information and promotional offers are presented by all the leading
brandsthroughtheirrespectivepagesonFacebook.
Brandwebsitesareemergingasanimportantmediumtopromoteshampoos.
Thebrandwebsitesprovidehairtipsandsuggestionsfordifferenthairproblems.
Major brands websites communicate product benefits and other unique features of
eachlineandvariant.
Marketers websites also provide contests to encourage consumer involvement with
thebrands.
4A82
Shampoos
Marketerslaunchdifferentpromotioncampaignstopromotetheirbrands.
Head&ShoulderslaunchesacampaignstarringsoccerplayerLionelMessi,appearing
inaseriesoftelevisionadvertisementsdesignedspecificallytoreachHispanicmalesin
theUnitedStates.
In 2012, TME for shampoos total $446.3million, up significantly by 27.0% from

Marketersspendalmost67.4%ofTMEontelevisionor$301.0millionin2012,followed
bymagazineswith$127.3million.
MarketleaderProcter&GamblesTMEfor2012is$156.3million,downby0.5%,from
ThePanteneProVbrandgarners$82.2millionoftheTMEin2012.ThePanteneProV
MoistureRenewallineisallocatedaTMEof$33.5millionin2012.
TheantidandruffbrandHead&Shouldersgarners$60.2millionoftheTME.
Secondleadingmarketer,UnileverhasaTMEof$103.3millionin2012,upsignificantlyby
94.9%from$53.0millionin2011.
Themarketersignificantlyspends$55.4milliontopromoteitsClearbrandin2012.
In2012,TMEforUnileversleadingbrandSuaveare$19.4millionandTRESemmhasa
TMEof$11.6million.
Approximately$78.3millionor75.7%ofthetotalTMEisspentontelevisionadvertising,
followedbymagazineadvertisingwith$19.2million.
Thirdleading marketer LOrals media spending on promoting its shampoo brands is

$51.4millionin2012,downfrom$70.7millionin2011.
GarnierFructis,LOralsleadingbrand,hasaTMEof$51.1million.
The marketer allocates approximately 71.5% or $36.7 million on television
advertisementsfollowedbymagazineadvertisementswithaTMEof$14.0million.
DetailedinformationonTMEinthecategoryisprovidedintheAdvertisingsectionofthis
report.
OUTLOOK
SalesoftheshampooscategoryareexpectedtogrowataCAGRof3.1%overtheforecast
period,2012to2017.
ThecategorycontinuestogrowdespiteitsrelativelymaturestageintheUnitedStates.
Shampoos with new and improved formulations are expected to drive the categorys
growthovertheforecastperiod.
Shampoos that protect the scalp health and enhance shine are expected to perform
wellinthefuture.
Marketers launching shampoos with improved formulations are expected to
experiencegrowththrough2017.
4D83
4D84
Shampoos
Productinnovationwillcontinuetodrivethecategoryssalesovertheforecastperiod.
Shampoosthatcatertospecifichairproblemsandhairtypesareexpectedtosupport
thecategoryssales.
Marketers will constantly incorporate additional hair care benefits, such as frizz
protectionandcolorprotectionintotheirproducts.
Shampoosthatcontainnaturalingredientsareexpectedtodrivethecategoryssales.
Consumerswillcontinuetolookforshampoosthatcontainnaturalingredients,suchas
herbalandfloralextracts.
Several leading marketers, such as Unilever and L'Oral are expected to eliminate
chemicalagents,suchassulfatesandparabensfromtheirproducts.
The success of L'Orals newer lines, such as EverPure and EverCreme (sulphatefree
ranges)willpromptothermarketerstooffersimilarproducts.
Naturalshampoosornaturallypositionedshampoosthatwillnotcausedamagetothe
hairarelikelytohavegooddemandinthefuture.
Mensshampooswillcontinuetogrowovertheforeastperiod,supportedbynewproduct
launchesandanincreasingdemandforsuchproducts.
Marketersconsiderthissegmenttohaveahugepotential,andasaresult,companies,
such as Unilever and Procter & Gamble are including mens care products in their
prioritylist.
UnileverlaunchestheClearMenrangeofshampoosand conditionersin2012,which
maybetheonlyrealthreattoHead&Shouldersdominance.
Procter&GamblealsolaunchesmensshampoosundertheHead&Shouldersbrand.
Aggressiveandinnovativeproductpromotionsareexpectedtobeamongthekeydriversfor
thecategorysgrowth.
Marketers will continue to exploit the Internet and its growing reach to increase the
onlineproportionofproductpromotion.
Onlinesocialmediawillcontinuetogainstrengthasproductpromotionandadvertising
tools.
Asthevolumeofonlineshoppingincreases,marketersareincreasinglylikelytoplace
theirproductsonlinetobuildtheirmarketshares.
Marketerswillencourageonlineshoppingbyprovidingdiscountsandfreesamplesfor
productsthatarepurchasedonline.
ManufacturerssalesareexpectedtoincreaseataCAGRof3.1%to$3,050millionby2017,
Unit volume sales are forecast to increase at a CAGR of 2.2% growing from 741million
packagesin2012to826millionpackagesby2017.
4A84
4E.MAKEUP
INTRODUCTION
Makeup products are applied to the face, eyes, and lips to impart color, to highlight and
accentuate,andtocoverblemishesorotherimpuritiesoftheskin.
Includedinthisproductclassarethefollowingcategories:
Eyemakeup
Facemakeup
Nailpolishes
MANUFACTURERSSALES
Themakeupproductclassisdrivenbythestrongperformanceofthefacemakeupandnail
polishescategoriesin2012.
The nail polishes category is the fastestgrowing product category in 2012, growing
17.4%toreach$662millionin2012,upfrom$564millionin2011.
Face makeup grows 3.7% to reach $2,909 million in 2012, up from $2,804 million in
2011andcontributesthemostdollarstothemakeupproductclass.
Totalsales
Salesofthemakeupproductclassreach$7,657millionatthemanufacturerslevelin2012,
Facemakeup,thelargestmakeupcategory,accountsfor38.0%oftotalsalesin2012.
Eye makeup follows as the secondleading makeup category with 35.4% of total
makeupproductclasssales,downslightlyfroma35.7%in2011.
Both,facemakeupandeyemakeupcollectivelyrepresent73.4%ofthetotalmakeup
productclasssalesin2012.
Lipsticksandlipglossesrepresent18.0%oftotalmakeupsalesin2012,downslightly
from18.4%oftotalmakeupsalesin2011.
Nail polishes is the smallest makeup category, though continues to be the fastest
growing,up17.4%.Nailpolishesrepresent8.6%oftotalsalesin2012,upfroma7.7%
sharein2011.
REPRODUCTIONORDISCLOSUREFORBIDDEN;SEESPECIALNOTICE KLINE &COMPANY,INC.
4E2
Makeup
Historicalsales
Since2007,makeupsaleshaveincreasedatacompoundannualgrowthrate(CAGR)of4.3%
to$7,657millionin2012.
Table4E1:HistoricalSalesofMakeupintheUnited
States,2007to2012
Year
$Million
Change,%
2007
6,342
2008
6,355
0.2
2009
6,446
1.4
2010
6,740
4.6
2011
7,341
8.9
2012
7,657
4.3
Salesbytradeclass
Massbrandsrepresent49.0%ofallmakeupsalesin2012.Thetradeclassgrowsby4.3%for
theyear,onparwiththetotalmarketgrowthof4.3%.
Salesofluxurybrandsfollowinsecondposition,with32.7%ofthetotalmakeupsales,
surpassingthetotalmarketgrowthandgrowingthefastest,up7.7%in2012.
The direct trade class is the thirdlargest, but declines by 2.1% to $1,169 million in
manufacturerssalesin2012.Avon,thesecondlargestdirectmarketer,contributesto
thedecline.
Figure4E1:ManufacturersSalesofMakeupintheUnitedStates,2012
Facemakeup,
38.0%
Nailpolishes,
8.6%
Lipsticksandlip
glosses,18.0%
Eyemakeup,
35.4%
Total:$7,657Million
4A2
Makeup
Table4E2:ManufacturersSalesofMakeupintheUnitedStatesbyTradeClass,2012
Tradeclass
$Million
Face
makeup
Eye
makeup
Lipsticksand
lipglosses
Nail
polishes
Total
%Oftotal
Mass
1,224
1,405
538
585
3,752
49.0
Luxury
1,087
884
494
38
2,503
32.7
Direct
538
356
246
29
1,169
15.3
Specialty
49
58
93
10
210
2.7
Professional
11
23
0.3
2,909
2,709
1,377
662
7,657
100.0
Total
RETAILSALES
Retail sales of makeup products are estimated at $11,670 million in 2012, up 4.4% from
COMPETITION
Thetopfivemarketersinthemakeupproductclassrepresent62%oftotalmakeupsalesin
2012,downfrom64%in2011.
The topfive companies generate more than $250million in sales in 2012, much less
thanthe$400milliontheycontributedin2011.
LOralcontributestwothirdsofthenewdollarsin2012 withthemostcoming from
Maybelline,LOralParis,andtheEssiebrands.
LOralistheleadingmarketerinthemakeupproductclassin2012.
Salestotal$1,814millionin2012,up10.5%from$1,641millionin2011.
LOrals share of the total makeup product class is 23.7% in 2012, up from 22.3% in
2011.
LOralhasasignificantpresenceinmostoftheproductcategoriesinthesegmentand
increasesitspresenceinthenailpolishescategoryin2012.
LOralprofitsfromitsstrongdistributionmodelthatisrootedinthemassandluxury
tradeclasses.
LOrals Maybelline is the leading brand in the makeup product class, with sales at
$782millionin2012,up8.8%from$719millionin2011.
LOral Paris is the thirdleading makeup brand in 2012, behind Covergirl, with sales
reaching $558million in 2012, up 6.9% from $522million in 2011. Eye makeup is the
largestproductcategoryforthebrand,with47.7%ofthetotalsales.
LancmeisthethirdleadingbrandintheluxurytradeclassbehindMACandClinique
withsalesof$281millionin2012,up5.2%from$267millionin2011.Lancmesshare
ofthetotalmarketis3.7%in2012.
4E3
4E4
Makeup
Table4E3:ManufacturersSalesofMakeupintheUnitedStatesbyCategory,Company,andMajor
Brand,2012
$Million
Face
makeup
Company/brand
LORAL
Eye
makeup
Lipsticksand
lipglosses
Total
Maybelline
235
446
91
10
782
LOralParis
188
266
83
21
558
Lancme
117
128
32
281
26
40
22
88
68
68
YSLBeaute
11
10
30
Dermablend
584
890
236
104
1,814
MAC
173
140
88
405
Clinique
196
105
47
352
EsteLauder
115
49
29
198
BobbiBrown
44
30
32
106
SmashboxBeauty
12
19
11
42
Origins
18
14
39
Aveda
16
565
354
226
13
1,158
328
290
103
723
REVLON
Revlon
105
133
123
48
409
Almay
58
71
129
Sinful
34
34
PureIce
25
25
Bari/BonBons
163
204
126
108
601
UrbanDecay
Essie
Total
ESTELAUDER
Totala
PROCTER&GAMBLE
Covergirl
Total
(Continued)
4A4
Nail
polishes
Makeup
Table4E3:ManufacturersSalesofMakeupintheUnitedStatesbyCategory,Company,andMajor
Brand,2012
$Million
Face
makeup
Eye
makeup
Lipsticksand
lipglosses
178
141
110
431
210
218
Rimmel
26
57
26
113
NYCNewYorkColor
14
18
10
42
OPI
21
21
Nicole
19
19
Coty
Total
49
75
27
264
415
192
61
18
271
Nars
17
15
14
46
Shiseido
28
46
237
85
41
363
805
670
508
169
2,152
662
7,657
Company/brand
MARYKAY
SallyHansen
SHISEIDO
BareEscentuals
Total
ALLOTHER
TOTAL
2,909
2,709
1,377
aTotalnolongerincludesBeautyBank,whichisnowincludedinAllOther.
Nail
polishes
Total
Este Lauder is the secondleading makeup marketer with a 15.1% share of the makeup
market,andtotalsalesof$1,158millionin2012.
Thecompanysurpassesoverallmarketgrowthwith6.5%growthin2012.
The company continues to be the leading marketer within the luxury trade class in
2012,accountingfor46.2%ofsegmentsales.
The companys MAC and Clinique brands are the leaders in the luxury segment and
importantbrandsforthemarketerastheyrepresent65.4%ofcompanyssalesin2012.
The face and eye makeup categories represent 79.4% of the companys sales, with a
totalofsevenbrandsinthemakeupluxurytradeclassin2012.
Clinique is the leading brand in face makeup within the luxury class with an 18.0%
share.
MACisthe leadingmarketerinthelipsticksandlipglosses categorywithintheluxury
trade class, with sales of $88 million in 2012. MAC has a category share of 17.8% in
2012.
MACdoublesitsnailpolishesbusinessin2012reaching$4millioninsalesin2012.
4E5
4E6
Makeup
Procter&Gamble continues to be the thirdlargest makeup marketer in 2012 with its

Covergirlbrand.
Sales total $723 million in 2012, down 4.1% from $754million in 2011. Procter &
Gamble represents 9.4% of total category sales in 2012, down from 10.3% of total
makeupsalesin2011.
Procter & Gamble is the largest marketer in the face makeup category with sales of
Face makeup represents the largest category for the brand with 45.4% of Covergirls
totalmakeupsalesin2012.
Procter&Gamblerankssecondintheeyemakeupcategory,withsalesof$290million
in2012,down4.6%from$304millionin2011.
Revlon is the fourthleading marketer in the makeup product class, with sales at $601
millionin2012,up1.5%from$592millionin2011.
Revlonrepresents7.8%oftotalmakeupsalesin2012downslightlyfrom8.1%in2011.
TheRevlonbrandhasa16.0%shareofthemasstradeclassin2012.
Eyemakeupistheleadingcategoryforthebrand,accountingfor32.5%ofthebrands
makeupsalesin2012.
Revlonisthefourthleadingeyemakeupmarketerin2012,with4.9%ofthecategorys
salesin2012.
Almayssalesdecline3.0%to$129millionin2012from$133millionin2011.
Revlonisthefourthlargestbrandinthelipsticksandlipglossescategorywithsalesof
RevlonacquirestheBonBonsandPureIcebrandsfromBariCosmeticsin2012,which
combinedcontribute$29millioninsalestothecompany.
MaryKayremainsinthefifthposition,witha5.6%shareofthetotalmakeupsales.
Salesgrow4.4%from$413millionin2011to$431millionin2012.
Facemakeupandeyemakeuprepresent74.0%ofthemarketerssales.
MaryKaylimitsthenumberofSKUsofnailpolishessoldtotwowhichvarybyseason
and/orholiday.
Cotyisthesixthleadingmarketerinthemakeupcategoryin2012.
Salesgrow1.0%in2012to$415million,upfrom$411millionin2011.
NailpolishisthemostimportantcategorytoCotyasitrepresents63.6%ofitsmakeup
sales,or$264million.
The Sally Hansen brand represents 52.5% of the marketers sales in 2012. The brand
declines8.0%in2012withsalesof$218million.Thebranddoesnotprovideenough
productormarketingnewnesstogrowsalesfrom2011.
Cotysnailpolishesmarketsharedeclinesfrom56.6%in2011to45.2%in2012.Coty
faces stiff competition with its plethora of new launches in the mass and specialty
tradeclasses.
Rimmel is the secondleading brand in Cotys portfolio behind Sally Hansen. Rimmel
sales reach $113 million in 2012, up 11.9% from $101 million in 2011. Rimmel
represents27.2%ofCotysalesin2012.
EyemakeupistheleadingcategoryfortheRimmelbrandwithsalesof$57millionin
2012,up9.6%from2011.
4A6
Makeup
RETAILDISTRIBUTION
Themassmerchandiserchannelrepresents26%ofmakeupsalesandcontinuestobethe
leadingchannelformakeupproductsin2012.
Nailpolishesarethefastestgrowingcategoryin2012.Lipsticksandlipglossesdecline
inthemasstradeclass.
Budgetbrands,suchasEyesLipsFace,Rimmel,andWetnWild,helpfuelthegrowthin
thechannel.
Department stores rank a close second with a 25% share as consumers seek personal
attentionandproducttrial.
Allcategoriesoutperformedthetotalmarketgrowthof4.3%.
Nailpolishesgrowthefastest,up25.8%in2012.
Drugstoresanddirectsalesaccountfor21%and15%oftotalmakeupsales,respectively,in
2012.
Drugstoresloseonesharepointtomassmerchandisersasmanydollarstoresbeginto
sell budget makeup brands and mass merchandiser stores revamp and extend shelf
spacetomorebrands.
CVSclosesallofitsBeauty360locationsin2012.
DirectsalesoverallareimpededbyAvonsfailuretokeepupwiththeoverallmarkets
growth.
Table4E4:RetailDistributionofMakeupintheUnitedStates,2012
Face
makeup
Eye
makeup
Lipsticksandlip
glosses
Nail
polishes
Weighted
average
Massmerchandisers
24
29
19.0
37
26
Departmentstores
30
26
24
25
Drugstores
18
19
25
39
21
Directsales
16
14
18
15
Specialtystores
10
11
10
Foodstores
Professionaloutlets
0.5
100
100
100
100
100
Retailoutlet
Total
4E7
4E8
Makeup
PROMOTION
Themakeupproductclasscontinuestobestronglyadvertisedin2012,andthepromotional
activitiesvarybytradeclass.
Themarketingmixforallmarketersincludesocialmediamarketing,suchasFacebook,
Twitter,YouTube,Pinterest,andTumblr.
Blogsonthebrandswebsitecontinuetobepopularandhelpconsumersfindcoupons,
dates when stores offer giftwithpurchase (GWP) promotions, as well as dates when
brandswillholdpromotionsthatofferdiscountshippingorfreesamples.
Online subscription on company websites, such as glossybox.com, julepmaven.com,
and curlbox.com, are making inroads whereby for a monthly fee, the subscriber will
receivetrialsamplesofbeautyproducts.
Traceablemediaexpenditures(TMEs)fortheproductclassreach$1,320millionin2012,up
16.5%from$1,133millionin2011.
The top three advertisers in the product classLOral, Procter & Gamble, and
Revlonaccount for approximately 75% of total advertising dollars for the entire
makeupproductclass.
LOral continues to be the leading advertiser in the product class with TME of
$605.3millionin2012,up10.9%from$546.0millionin2011.
LOralsMaybellineistheleadingadvertisedbrandin2012,with$320.6millioninTME,
up6.7%from$300.4millionin2011or53.0%ofLOralstotaladvertisingdollars.
LOral Paris is the secondlargest advertised brand by the marketer in 2012, with
$222.8million,up14.3%from$194.9millionin2011.
Procter & Gamble is the secondleading advertiser in the product class with TME of
$224.6millionin2012,down44.9%from$325.5millionin2011.
Procter&GamblesflagshipbrandCovergirlaccountsfor96.0%ofthemarketerstotal
advertisingspendingin2012,whiletheremainingisusedtosupporttheluxurybrand
Dolce&Gabbana.
Revlon follows as the thirdleading advertiser in the product class with TME of
$147.0million in 2012, up 7.1% from $137.2million in 2011. Revlons flagship brand
Revlonreceivesabout81%oftheTMEin2012.
Massbrandscharacteristicallyrelyonprintandtelevisionmedia,anddiscountcoupons
eitheratinstoredisplaysorinprintviamagazinesandwebsites.
Leading mass brands are often supported by celebrity endorsements. For example,
CoverGirlusessingersPinkandJanelleMonaeandactressSofiaVergara.
Mostlargemassretailerstypicallyrunpromotionsofferingmakeupproductsatbuy
onegetonefreeorbuyonegetonehalfpricetostimulatemultiplepurchases.
Theleadingmassbrands,suchas Maybelline,LOral,andRevlon,pushcoupons and
discountstosmartphones.
Mass marketers use their own websites to duplicate the role of the beauty
representative found in department stores to help consumers match products with
theirskintypeandorshade.
4A8
Makeup
4E9
Sales personnel at beauty counters continue to be critical in selling luxury brands within
department stores promoting products by way of education and free samples. Marketers
partnerwithstorestoprovideinstoreactivitiestodrawconsumerstotheircounters.
Retailersareincreasinglycarvingoutspacetoshowcasesingleitemsacrossallbrands,
nearthecashregistertogetconsumerstoeithertrynewproductsintrialand/ortravel
sizes.
Retailers, such as Sephora, use end caps that change monthly in their stores to
showcasefavoriteand/orhotitems.
Marketers continue to use giftwithpurchase (GWP) and purchasewithpurchase
(PWP)promotionsasincentivestopurchase.
Marketersusesocialmediasitestopromotenewproductsandinstoreevents.
Thepromotionalactivitymainlycentersonbringingconsumerstothebeautycounters,
wheresalespersonnelofferfreemakeovers,consultations,andsamples.
Most luxury brands websites offer free shipping on orders above $50.00; however,
Este Lauder offers free shipping and returns, and Clinique offers freestandard
shipping. Some marketers, such as Bobbi Brown, offer free returns on foundation,
concealer,andpowder.
Este Lauder is the leading marketer in the luxury trade class with a TME of
CliniquereceivesthemostTMEfromthemarketeranduses$61.8milliontopromote
itsproductsin2012.Itisalsotheonlyleadingluxurybrandthatadvertisesontelevision,
usingapproximately20%ofitstotalTMEallotmentfromthemarketer.
Lancme is the secondlargest advertised brand in the luxury trade class with
$28.6millioninTMEin2012,followedbytheEsteLauderwith$23.4million,andBare
Escentualswith$18.5million.
Table4E5:ExamplesofCouponingActivityofMakeupintheUnitedStates,2012
Company/division
Brand
Promotion
EsteLauder
BobbiBrown
Pickthreesamplesofconcealer,mascara,orBBcreamandfree
shippingwithminimum$65.00purchase.Freereturnson
foundation,concealer,orpowder
LOral
LOralParis
$1.00offonanyLOralParisproduct
Procter&Gamble
Covergirl
$3.00offwhenyoupurchasetwoCovergirlnailproducts
Procter&Gamble
Covergirl
Save$2.00withthepurchaseofPeoplemagazineandany
CovergirlOutlastlipcolor
Procter&Gamble
Covergirl
$2.00offontwo24HRmascaraand/orOutlastlipcolor
Revlon
Revlon
$3.50offonanyRevlonpurchaseof$10.00ormore
Revlon
Revlon
Save$2.00onanyRevlonPhotoReadyFaceProduct
Shiseido
Nars
20%offonatotalorderfortwodaysstartingCyberMonday
4E10
Makeup
OUTLOOK
Thegrowthoftheproductclassislikelytobesupportedbyincreasesintheadvertisingand
promotional efforts of the marketers, including those that declined in advertising dollars
spentin2012.
Additionally, smaller niche brands and budget brands are expected to increase their
advertisingbudgetsduringtheforecastperiod.
Newnessintheproductclasswillcontinuetodrivesalesaswellaspriceincreasesthat
arewarrantedthroughnewingredients,packaging,andtechnologyacrosstradeclasses.
It is anticipated that marketers with skin care brands will continue to introduce
scientificallyadvancedingredientsintomakeupproducts,especiallythoseproductsin
thefacemakeupcategory.
Trendsettingproductsfoundfirstintheluxurytradeclassislikelytotrickledownto
masswherebudgetbrandssuchasEyeLipsFace,Rimmel,andWetnWildarelikelyto
capitalize.
Promotion through tutorials of products on marketers websites and/or packaging is
expectedtocontinue,asconsumersarelikelytoseekouttheirfavoritecelebritylook
orprofessionalmakeupartistlookwithoutalwayshavingtogotoacounterorexpert.
Natural products are still underdeveloped but provide great potential for marketers
withsuchheritage,whilespecialtystorescontinuetopromotethesebrands.
Face makeup categorys sales are predicted to remain on par with the overall makeup
marketgrowthataCAGRof3.8%through2017.
Foundationsandprimersthatofferskincarebenefitsareexpectedtodrivesalesboth
inunitsanddollars.However,somesaleswillbecannibalizedbythegrowingpopularity
ofbeautybalms.
However, as women strive for complexion perfection, primers and concealers are
expectedtosupportnewsales.
Finishing products that help keep products in place are anticipated to grow in
popularityasmoremarketerslaunchsuchproducts.
Liquidandcreamfoundationsareanticipatedtobeattheforefrontattheexpenseof
mineralpowders.
Asconsumerscontinuetoreachforcomplexionperfection,withproductsthatcontain
beneficialornaturalskincareingredientsandareweightlesswhilematchingskintone,
isexpectedtogrowatahealthyrate.
Inadditiontofoundations,primersandconcealerswillbesoughtafter.
Consumer confidence is expected to improve and sales are expected to increase
especiallyamonghigherpricedbrandsasconsumerstradebacktotheirtrustedbrands
ofthepastorfindnewbrandsthatoffersomethingdifferent.
Shadematchingisexpectedtoplayacriticalroleinobtainingandkeepingconsumers
especiallyamongmassmarketers.
4A10
Makeup
SalesintheeyemakeupcategoryareanticipatedtogrowataCAGRof3.1%through2017.
Marketers are expected to add new limited or seasonal collections to their lines to
createexcitementandaddincrementalsalesthroughouttheyear.
Thetrendofwearingmultipleshadesoneyelidsisjustbeginningandislikelytospur
saleswithinthecategory.Also,layingshimmerorglittereyeshadowisanticipatedto
growsales.
Marketers are likely to continue to launch new and improved formulas within eye
shadowsandmascaras.
Mascarasthatpromotelashlengththroughtheuseofmorefibersorwithproductsto
fillinthegapsbetweenlashesareexpectedtofuelsalesinthecategory.
ThecategorywilllikelyseeanincreaseinadvertisingduringtheforecastperiodasTME
declinesforthecategoryin2012.
Lipsticksandlipglossescategoryssalesareexpectedtobetheslowest,growingataCAGR
of2.4%duringtheforecastperiodthrough2017.
Itisanticipatedthatwomenwillpurchasemultiplelipproductstocapturetheirmood
ortimeofthedayandislikelytospursales.
It is likely that lip liners will remain relatively flat unless a new trend or innovative
technologytakesholdduringtheforecastperiod.
Bold,redlipsarelikelytoremainpopularandarepredictedtostay.
Natural brands are anticipated to grow as they improve shades and formulas and
increasepromotion.ThenewestbrandisObsessiveCompulsiveCosmeticswithacult
favorite,LipTar.
Multifunctionallipproducts,suchasthosethataredualtipped,stainononesideand
moistureorglossontheother,arelikelytocontinuetodrivesales.
More attractive packaging is anticipated because consumers consider lip products a
beneficialaccessory.
The nail polishes categorys sales are projected to outpace the overall market growth of
9.0%duringtheforecastperiodending2017.
Enthusiasm in the category is anticipated as marketers continue to launch innovative
shades,textures,anddifferenttypesofnailart.
Thebroadrangeofexcitingnewhuesisexpectedtoprovokeconsumerstowearand
repurchaseoftentosuittheirfashionpalette.
Gelbased formulations are here to stay and it is anticipated that marketers will
increasingly advertise gellike products as well as doityourself (DIY) gel products.
These products are expected to drive retail prices and sales volumes, as more
consumersadoptgelpolishesathome.
Itisalsoanticipatedthatnewinnovationsingeltechnology,suchaseasyremovalgel
polishislikelytofuelsalesthroughtheforecastperiod.
Brandsthathavenotfollowedthenailcrazearepredictedtolaunchandadvertisenew
products.
4E11
4E12
Makeup
Sales for the makeup product class are forecast to grow at a CAGR of 3.8% to reach
$9,241millionby2017,upfrom$7,657millionin2012.
UnitsalesareexpectedtoadvanceataCAGRof4.2%through2017toreach1,740million
packages,upfrom1,418millionpackagesin2012.
Table4E6:ForecastManufacturersSalesofMakeupintheUnitedStatesby
Category,2012to2017
$Million
Category
2012
2017
CAGR,%
Facemakeup
2,909
3,509
3.8
Eyemakeup
2,709
3,160
3.1
1,377
1,553
2.4
662
1,019
9.0
7,657
9,241
3.8
Nailpolishes
Total
Table4E7:ForecastUnitSalesofMakeupintheUnitedStatesbyCategory,2012to2017
Millionpackages
Category
2012
2017
CAGR,%
Eyemakeup
524.9
650.8
4.4
Facemakeup
421.4
488.5
2.5
237.5
256.0
1.5
Nailpolishes
234.6
344.7
8.0
1,418.4
1,740.0
4.2
Total
4A12
EYEMAKEUP
CATEGORYPERFORMANCE
Manufacturerssales
Salesincreaseatacompoundannualgrowthrate(CAGR)of4.9%since2007.
Table4E8:HistoricalSalesofEyeMakeupintheUnited
States,2007to2012
Year
$Million
Change,%
2007
2,133
2008
2,200
3.1
2009
2,304
4.7
2010
2,431
5.5
2011
2,621
7.8
2012
2,709
3.4
Manufacturerssalesintheeyemakeupcategorygrowby3.4%toreach$2,709millionin
2012,upfrom$2,621millionin2011.
Eye makeup is the secondleading makeup category in 2012, with 35.4% of the total
salesfortheproductclass.
Mascarascontinuetoaccountformajorityofthesaleswithinthecategory.
Mascarasaretheleadingsegmentintheeyemakeupcategory,with51.0%oftotaleye
makeupsalesin2012.
Mascarasgrowby3.4%toreach$1,383millioninmanufacturerssales.
Growthofthecategoryisfueledbynewproductlaunchesthatincludeproductswith
multiplebenefitsandnewbrushtechnology.
4E14
EyeMakeup
Table4E9:ManufacturersSalesofEyeMakeupintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
MASS
2011
2012
%Oftradeclass
2011
2011
2012
Maybelline
LOral
422
446
30.7
31.7
16.1
16.5
Covergirlr
Procter&Gamble
304
290
22.1
20.6
11.6
10.7
LOralParisr
LOral
257
266
18.7
18.9
9.8
9.8
Revlon
Revlon
133
133
9.7
9.5
5.1
4.9
Almay
Revlon
74
71
5.4
5.1
2.8
2.6
Rimmelr
Coty
52
57
3.8
4.1
2.0
2.1
Wet'N'Wild
Markwins
30
32
2.2
2.3
1.1
1.2
PhysiciansFormula
PhysiciansFormula
23
25
1.7
1.8
0.9
0.9
NYCNewYorkColor
Coty
15
18
1.1
1.3
0.6
0.7
Neutrogena
Johnson&Johnson
15
15
1.1
0.9
0.6
0.6
TSGConsumerPartners
EyesLipsFace
10
13
0.7
0.6
0.4
0.5
Prestige
PrestigeCosmetics
0.6
0.6
0.3
0.3
BonneBell
BonneBell
30
30
2.2
2.1
1.1
1.1
100.0
100.0
Allother
Total
1,374
1,405
52.4
51.9
LUXURY
MAC
EsteLauder
134
140
16.2
15.8
5.1
5.2
Lancme
L'Oral
122
128
14.8
14.5
4.7
4.7
Clinique
EsteLauder
100
105
12.1
11.9
3.8
3.9
Chanel
Chanel
49
50
5.9
5.7
1.9
1.8
EsteLauder
EsteLauder
48
49
5.8
5.5
1.8
1.8
Benefit
LVMH
30
40
3.6
4.5
1.1
1.5
BobbiBrown
EsteLauder
29
30
3.5
3.4
1.1
1.1
ChristianDior
LVMH
26
29
3.1
3.3
1.0
1.1
SmashboxBeauty
SmashboxBeauty
Cosmetics
18
19
2.2
2.1
0.7
0.7
LauraMercier
Amway
18
19
2.2
2.1
0.7
0.7
Nars
Shiseido
14
15
1.7
1.7
0.5
0.6
TrishMcEvoy
TrishMcEvoy
13
14
1.6
1.6
0.5
0.5
Shiseido
Shiseido
1.0
1.0
0.3
0.3
Origins
EsteLauder
0.7
0.8
0.2
0.3
FashionFair
JohnsonPublishing
0.7
0.7
0.2
0.2
ElizabethArden
ElizabethArden
0.7
0.6
0.2
0.2
Clarins
Clarins
0.6
0.5
0.2
0.2
Stila
Stila
0.5
0.5
0.2
0.1
152
161
18.4
18.2
5.8
5.9
826
884
100.0
100.0
31.5
32.6
Allotherr
Total
(Continued)
4A14
2012
%Oftotal
4E15
EyeMakeup
Table4E9:ManufacturersSalesofEyeMakeupintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
DIRECTSALES
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
132
141
36.7
39.6
5.0
5.2
MaryKay
MaryKay
Avon
Avon
95
88
26.4
24.7
3.6
3.2
BareEscentuals
Shiseido
61
61
16.9
17.1
2.3
2.3
Mark
Avon
13
12
3.6
3.4
0.5
0.4
Artistry
Alticor
1.1
1.1
0.2
0.1
VictoriaJackson
VictoriaJackson
Cosmetics
2.5
0.6
0.3
0.1
46
48
12.8
13.5
1.8
1.8
360
356
100.0
100.0
13.7
13.1
22
22
40.0
37.9
0.8
0.8
Allother
Total
SPECIALTY
VictoriasSecret
LimitedBrands
Privatelabel
21
24
38.2
41.4
0.8
0.9
Allother
12
12
21.8
20.7
0.5
0.4
55
58
100.0
100.0
2.2
2.0
66.7
66.7
0.2
0.1
33.3
33.3
0.1
0.1
100.0
100.0
0.2
0.2
100.0
100.0
Total
PROFESSIONAL
Aveda
EsteLauder
Allother
Total
TOTAL
2,709
2,621
rRestated.
Unitsales
Unit sales of eye makeup products grow 2.0% to reach 525million packages in 2012, up
from515millionpackagesin2011.
Retailsales
Retailsalesoftheeyemakeupcategoryareestimatedat$4,122millionin 2012, up3.4%

4E16
EyeMakeup
CATEGORYDEVELOPMENT
Markettrends
Growthofthecategorycontinueswiththesmokyeyestrendasthedriver,butisenhanced
in2012withboldeyebrows.
Themostdramaticgrowthcomesfromeyelinerandeyebrowproductsaswomenstrive
for eyes that communicate sex appeal, with dramatic eyeliner and accentuated
eyebrows.
Eyeshadowsalesarerelativelyflatasbothsalesinthemassandluxurytradeclasses
declinein2012.
Eyeshadowsalesdeclineto$677millionin2012from$681millionin2011.
Eye shadow formats are released by many brands from trios to quads to multiple
colored palettes. Some marketers, such as Smashbox Cosmetics use palettes to
enhancespecificeyecolorstotaketheguessworkoutofthemindoftheconsumer.
Thebreadthofeyeshadowshadesisvastin2012.Shadesrangefromnudestodeep,
richcolors,tometallicandglitterinallcolorsoftherainbow.UrbanDecaycontinuesto
doverywellwithitsNakedpalettefranchises
Severalmarketersprovideeyeshadowpalettestoencouragewomentoplayandhave
fun with color. Consumers also enjoy the value proposition that multiple shadows
provide.
Palettes have a downside for marketers, as consumers are less likely to purchase
severalsingleeyeshadows.
Similar to the wet/dry foundations, many of the brands eye shadow assortments
include eye shadow powders that can go on dry for a subtle look, but that can be
moistenedtogooncreamyforlongerlasting,deeperpigments.
Additionally, creamy eye shadows in pots like MACs Pro Longwear Paint Pot that
provide high pigment in a creamy texture but dry to a powder are also seen from
severalmarketers.Inthemassmarket,MaybellinelaunchesColorTattoo24hrCream
GelShadow.
Multitonedeyesareatrendasareshadowswithhintsofsparkleorshimmer.
Bakedpowderscontinuetobepopular,asmarketersembossbeautifuldesignsonthe
eyeshadow.Auniqueuseofthebakedeyeshadowandmarketingconnectionisfrom
Chantecaille, which embosses elephants in its eye shadow palettes of rich, earthy
metallicshadeswhilesupportingaWildlifeTrustthroughproceedsfromsales.
In addition to paint pots, marketers use creamy formulas in the form of crayons or
liquids, such as Cliniques Chubby Stick Shadow Tint for Eyes and Lid Smoothie
Antioxidant8hourEyeColourandRevlonsColorstaySmokyShadowStick.
New applications are seen as well, such as Bare Minerals Whipped Velvet Longwear
Eyecolorthatgoesongoldandbuffsouttoabrilliantbluehue.
Primersareincludedinsomepalettes,suchasAlmaysWakeUpEyeShadow+Primer
product.
Tutorials on how to doityourself (DIY) are being used by marketers. For example,
Lorac includes a sticker to put on the mirror with instructions on ways to achieve a
certaineyelook.
4A16
EyeMakeup
Mascaraisthepreferredsegmentthatmostwomendonotgowithout.Mostwomenseek
longer,fuller,anddefinedlashes.
Theplethoraofnewandimprovedmascarascontinuestoaddexcitementandgrowth
tothecategory.
In addition to volume and definition, dualpurpose mascaras that include eyelash
primersandadditivefibersarelaunched.
Falselashesareeasilyavailablefrommostmarketers.Althoughmostwomenarenot
comfortableapplyingfalselashesthemselves,thefalselasheslookappealstothem,in
partduetosingersAdeleandKatiePerrywhoareknownforwearingfalselashes.This
trendmakeswayformarketerstolaunchmascarasthattoutafalselashlookorthat
have fibers in their formula to achieve the look. New products include MACs False
Lashesmascara,andTooFacedBetterThanFalseLashesmascara.
The rods, wipers, brushes, tubes, and formulas are all changing constantly with new
shapes and colors. Marketers use pictures of their different brush technology to
showcasethedifferencesbetweentheirproductsandthedifferentlooksoflashesthat
canbeachieved.
Mascarastoutinghighglossareattheforefront.
Primers are also used as part of the application either as a separate product or as
doubleendedmascarabrush.
Buzzwords in marketing mascaras in 2012 include lash extensions, fiber extensions,
extreme,mega,mouse,gel,collageninfused,impact,antismudge,andmultiplying.
Eyelinersandeyebrowproductsarethefastestgrowingsegmentineyemakeupin2012.
Geleyelinercontinuestobepopularasconsumersfinditeasytousesinceitglideson
smoothlyandiseasilysmudgedforthesmokyeyelook.
Liquideyelinerisbecomingmoremainstreamasmarketersmaketheproducteasyto
use.
Glittereyelinerispopularin2012toachieveasparklylook.
Nomattertheshape,theboldeyebrowslookisatrendin2012.
Thereareaplethoraofnewproductlaunchesintheeyebrowsegmentin2012.
BenefitCosmeticsdeclaresApril1622astheNationalBrowWeek.Thebrandhasmore
than400browbarsacrosstheUnitedStates.
MACdedicatesanentirecounterinitsfreestandingstoresforbrowproductsin2012.
4E17
4E18
EyeMakeup
Notablenewproducts
Table4E10:SelectNewEyeMakeupProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Amway
LauraMercier
EyeColorfeaturingnewbakedtechnologyinsixshades
Amway
LauraMercier
CaviarStickeyecolorpencilthatoffersanewtechniquetoenhancethe
smokyeyelook
Chanel
Chanel
LesQuatreOmbresDeChanelacombinationof4eyeshadows
Chanel
Chanel
CrayonSourcilsEyebrowPencil
Coty
Rimmel
LashAcceleratorEndlessmascara
Coty
Rimmel
ScandaleyesWaterproofKohleyeliner
EsteLauder
BobbiBrown
LimitedEditionEyeShadowPaletteCollections
EsteLauder
Clinique
ChubbyStickShadowTint
EsteLauder
EsteLauder
PureColorStayOnShadowPaint
EsteLauder
MAC
FalseLashesmascara
EsteLauder
SmashboxCosmetics
PhotoOpEyeEnhancingPaletteforblue,brown,andhazeleyes
Lorac
Lorac
ProPalette16eyeshadowsamixofmatteandsparklingcolorsthatcanbe
appliedwetordry
LOral
LOral
Infallible24HREyeShadow
LOral
LOral
ColourRicheeyeshadow
LOral
LOral
VoluminousPowerVolume24HRMascara
LOral
LOral
VoluminousFalseFiberLashesmascara
LOral
LOral
TelescopicShockingExtensionsmascara
LOral
LOral
MagicDeCreaseEyelidPrimer
LOral
LOral
LOral
Lancme
HypnoseStarMascaradualactionbrushhasaflatsideforoptimizing
productdepositatthelashlinewhiletheroundedsideseparates,defines,
andlengthens
LOral
Maybelline
VolumExpresstheMegaPlushMascara
LOral
Maybelline
DefineABroweyebrowpencil
LOral
Maybelline
EyeStudioMasterShapeBrowPencil
LOral
UrbanDecay
SmokedEyeshadowPalette
LVMH
Dior
DiorShowExtasemascara
Markwins
WetNWild
MegaImpactmascara
MaryKay
MaryKay
LashLoveWaterproofmascara
Revlon
Revlon
SmokyShadowStick
Revlon
Revlon
PhotoreadyPrimer,Shadow+Sparkleeyeshadow
Shiseido
Nars
EyelinerStylofelttipliquideyeliner
Shiseido
Nars
LargerThanLifeLongWearEyeliner
Stila
Stila
Stila5EyeshadowPalette
TooFaced
Cosmetics
TooFacedCosmetics
3WayLashingLiningToolAtripletiplashemphasizingtoolthatfillsin
spacesbetweenlashes
TooFaced
Cosmetics
TooFacedCosmetics
BetterThanFalseLashesmascara
4A18
EyeMakeup
M&Aactivity
LOral acquires Urban Decay from Castanea Partners, Inc., a private equity firm in
November2012.
The financial details of the acquisition are not disclosed, but are estimated to be as
highas$350million.
CosmeticsinJuly2012.
Terms of the transaction are not disclosed; however, Revlon uses $22 million of
borrowings under its 2011 Revolving Credit Facility, along with cashonhand to fund
theacquisition.
Salesbyproducttype
Table4E11:SalesofEyeMakeupProductsintheUnitedStatesbyProductType,2011and
2012
Producttype
$Million
%Oftotal
2011
2012
1,337
1,382
51.0
51.0
3.4
Eyeshadowsr
681
677
26.0
25.0
(0.6)
Allothera,r
603
650
23.0
24.0
7.8
Total
2,621
2,709
aIncludeseyelinersandeyebrowproducts.
rRestated.
100.0
100.0
3.4
Mascarasr
2011
2012
Change,%
Mascarasrepresentthemajorityoftheeyemakeupcategorywitha51.0%sharein2012.
Salesforthesegmenttotal$1,382millionin2012,up3.4%from$1,337millionin2011.
Newproductactivityfuelsthegrowthinthecategory.Someofthemarketersdriving
the growth include Maybelline, Covergirl, Rimmel, Clinique, Lancme, MAC, and
Benefit.
4E19
4E20
EyeMakeup
Eyeshadowisthesecondleadingsegmentintheeyemakeupcategory,with25.0%ofeye
makeupsalesin2012.
Eyeshadowsdeclineslightlyin2012.Itisdebatableifpalettesalescannibalizethesales
of single eye shadow purchase, which holds higher price point overall than if one
breaksdownthepriceofshadowsinapalette.
Another trend that is a likely contributor to fewer purchases of eye shadow is the
smoky eye look where consumers use heavy eyeliner and mascara with just one eye
shadow.
Theforecastto2017showseyeshadowincreasing,asfashionwilldictatemorecolor
intotheeyeshadowregimens,withmultiplecolorsofeyeshadowsoneyelids,aswell
asabitofsparkle.
COMPETITION
Bycompany
Table4E12:ManufacturersSalesofEyeMakeupintheUnitedStatesbyCompany,2011and2012
$Million
%Oftotal
Company
2011
2012
2011
2012
Change,%
LOralr
841
890
32.1
32.9
5.8
EsteLaudera
339
354
12.9
13.1
4.4
Procter&Gambler
304
290
11.6
10.7
(4.6)
Revlon
207
204
7.9
7.5
(1.4)
MaryKay
132
141
5.0
5.2
6.8
Avon
108
100
4.1
3.7
(7.4)
Shiseido
83
85
3.2
3.1
2.4
Allother
607
645
23.2
23.8
6.3
Total
2,621
2,709
100.0
100.0
aDoesnotincludesalesofBeautyBank,whichisnowincludedinAllother.
rRestated.
3.4
4A20
EyeMakeup
LOralistheleadingeyemakeupmarketerin2012withsalesof$890million,up5.8%from
$841millionin2011.
LOral increases its share slightly as the company outperforms the overall market
growthforthecategory.
LOral is the leading advertiser in the eye makeup category with traceable media
expenditure(TME)of$204.2millionin2012,sameasin2011.
Maybelline is the largest advertised brand from LOral in 2012, with TME of
$133.4million,up8.5%from$122.9millionin2011.
LOralParisissupportedwith$59.2millioninadvertisingdollarsin2012.TMEdeclines
8.1%in2012comparedtothelevelofsupportreceivedin2011.
All of LOrals brands contribute to the companys growth as all outpace the overall
marketgrowthof3.4%.MaybellineandLOralPariscontributethemostdollars,while
Urban Decay and YSL Beaute experience doubledigit gains of 29.0% and 11.1%,
respectively.
Maybellineistheleadingbrandintheeyemakeupcategoryandoutpacesthemarket,
growing5.7%toreach$446millionin2012,upfrom$422in2011.
Lancmessaleswith4.9%growthreach$128millionin2012,upfrom$122millionin
2011.
GrowthoftheMaybellinebrandcomesfromitsmascaralaunches,eyebrowcollection,
andeyeshadows.Eyelinersalesforthebrandareflatin2012.
MaybellineexpandsitsshareoftheeyebrowsegmentwithitsEyeStudioMasterShape
Brow Pencil and DefineABrow product. Maybelline also has success with its Volum
ExpresstheMegaPlushandIllegalLengthfiberextensionmascaras.Salesgaincomes
fromitsColorTattoo24hrCreamGelShadow.
Lancmes growth comes from many products within the eye shadow, mascara and
eyebrows segments. Known for its mascaras, Hypnose Star and Hypnose Doll lashes
contributetothebrandssuccessinthesegment.
UrbanDecayssalessoarduetothepopularityofitsNakedeyeshadowpalettes.
SalesofEsteLaudergrowby4.4%to$354millionin2012from$339millionin2011.
Este Lauder moves into second position in the eye makeup category with 13.1% of
MACandCliniqueareEsteLaudersleadingbrands,withsalesat$140million,up4.5%
and$105million,up5.0%,respectively,in2012.
MACandCliniquecollectivelyrepresent63%ofEsteLauderstotaleyemakeupsales
in2012.
MACsgrowthisrecognizedbythesuccessofseveralnewproductsacrossthecategory
includingFalseLashesmascara,PaintPots,EyeBrows,aswellasseveraleyeliners.
Cliniques growth comes from its new Chubby Stick Shadow Tint, the existing Lid
SmoothieAntioxidant8HourEyeColor,aswellasthenewHighImpactmascara.
TheEsteLauderbrandgrowsonly2.1%in2012toreach$49millioninsales.Growthis
attributed partly to its newest mascaras Sumptuous Extreme Waterproof and
SumptuousTwoToneEyeOpeningmascara,andthelaunchofPureColorPaintPots.
EsteLaudersTMEfor2012is$12.7million,upfrom$3.7millionin2011.
4E21
4E22
EyeMakeup
Procter & Gamble moves down to the third position in the category as sales slide down
4.6%in2012to$290millionfrom$304millionin2011.
Themarketersshareofthecategoryalsodeclinesfrom11.6%in2011to10.7%in2012.
ThenewlaunchesinmascarathatincludetheLashBlastfranchiseperformwellforthe
Covergirlbrandbutsalesdonotexceedthefalloutfromtheeyeshadowandeyeliner
sales decline. The brand does not compete in the eyebrow category, which fuels
growthformanymarketersin2012.
Despite having an impressive cast of megastar spokesmodels including singers Taylor
SwiftandPink,Covergirldoesnothavecomparablenewproductlaunchestopromote
in 2012. However, the marketer appears to be rectifying the situation with new
productsreleasesinearly2013.
Procter & Gamble is the secondleading advertiser in the category with TME of
$74.2millionin2012,down27%from$101.6millioninTMEin2011.Twothirdsofthe
TMEsupportthebrandsmascaraproducts.
Revlonranksfourthin2012,with7.5%ofthecategoryssales.
Salesforthemarketerare$204millionin2012,adeclineof1.4%from$207millionin
2011.ThemarketershrinksitsTMEfrom$52.2millionin2011to$31.5millionin2012.
TheRevlonbrandssalesare$133millionin2012,flatfrom2011.
Revlonsbestperformingsegmentiseyeshadowsin2012.
TME to support the eye shadow business is approximately $8 million in 2012. The
mascarabusinessissupportedwithapproximately$9.5millioninTMEin2012.
Almayssalesdecline4.1%from2011withsalesof$71millionin2012.
Almayissupportedwith$11.6millioninTMEfortheeyeshadowsegment,inparticular,
products within the Intense IColor franchise, and, $1.8 million in TME is used to
supportitsAlmayOneCoatGetUp&Growmascara.
MaryKayisthefifthleadingeyemakeupmarketerwithacategoryshareof5.2%andsales
of$141millionin2012,up6.8%.
Mary Kays growth is recognized due to several successful launches including its lash
primerandbrowbuilder,creameyeshadowpots,andLashLoveWaterproofmascara.
The waterproof version is added in 2012 as an extension of the successful launch of
LashLovein2011.
Additionally, the gel eyeliner, although not new, performs well in the second half of
2012.
RETAILDISTRIBUTION
Department stores and specialty stores gain at the expense of drug stores, as consumers
seek out makeup artist lines and luxury brands on one end of the spectrum and budget
brands,suchasEyesLipsFace,Rimmel,andWetNWildbrandsatmassmerchandisers.
4A22
EyeMakeup
Table4E13:ManufacturersSalesofEyeMakeupinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
29
29
Departmentstores
25
26
Drugstores
20
19
Directsales
15
14
Specialtystores
Foodstores
100
100
Total
MARKETINGACTIVITY
Massbrandscontinuetouseheavyadvertising,pricingdiscounts,andcouponstopromote
products.
The leading mass brands, such as Maybelline, LOral, and Revlon, offer discount
coupons,andcontinuetopushcouponsanddiscountstosmartphonesthroughtheir
retailpartnerships.
MostmarketersarenowusingsocialmediasitesincludingFacebook,Twitter,YouTube,
Pinterest, and Tumblr to promote their brands and expand awareness among
consumers.
Massmarketerswebsitesfeaturehowtosectionssothatbuyerscanobtainthelookon
themodelintheadvertisement.
Thetopmassbrandsareoftenbackedbycelebrityendorsements.
TheadvertisingcampaignforCovergirlusesactress,SofiaVergaraforitsLashBlast24
hr mascara. Covergirl also uses singer Taylor Swift for its Lash Blast Volume mascara
andforitsEyeEnhancersandPerfectPointPlusLinerproducts.
AlmaycontinuestouseactressKateHudsoninitsadvertisements.
BothLOralandRevlonusesupermodelsfortheireyemakeupadvertisements.
Table4E14:CouponingActivityforEyeMakeupintheUnitedStates,2012
Company/division
Brand
Promotion
LOral
LOralParis
Buyonegetonehalfoff
LOral
Maybelline
Save$2.00withthepurchaseofPeoplemagazineand
Procter&Gamble
Covergirl
$2.00offontwo24HRmascaraand/orOutlastlipcolor
Shiseido
Nars
20%offontotalorderfortwodaysstartingCyberMonday
4E23
4E24
EyeMakeup
Luxury brands in the eye makeup category trust sales personnel at beauty counters to
promote products by way of makeup application and free trial. Retailers typically use in
storeactivitiestodrawconsumerstocounters.
Promotionalactivityisusuallyservedthroughgiftwithpurchase(GWP)andpurchase
withpurchase (PWP) promotions as key incentives to purchase, although marketers
continuetoincreasesamplingeffortsatcounterandonlinetominimizeGWPevents.
Moretraditionaladvertisingisseenfromthosewhorarelyorneveradvertisedbefore
includingBobbiBrown, whosigned actress,KatieHolmestobeitsfirst evercelebrity
spokesperson.OthersincludeChantecaille,Nars,andMAC.
Retailers and marketers are using applications in smart phones and sending emails
directlytoconsumerstopromotetheirproductsandspecialevents.
Most luxury brands websites offer free shipping on orders above $50.00; however,
Este Lauder offers free shipping and returns, and Clinique offers free standard
shipping.BobbiBrownoffersfreereturnsonfoundation,concealers,andpowders.
Many marketers are participating in friends and family events with 20% off coupons
that in the past have usually been used for stores fashion items excluding beauty
products.
Marketersareincreasingtheirsamplingeffortsespeciallywithonlineorders.
Direct marketerscontinue to rely on sales consultants to promote their products,but are

increasinglyutilizingothervehiclesincludingprintandtelevisionadvertising.
Mary Kay is one of the leading direct marketers whose success in 2012 can be
attributedtosalesrepresentativesholdingpartiestopromoteratherthansellingone
toone.
VictoriaJacksonisnolongersoldonGuthyRenkerswebsiteorontelevision.
Avon continues to falter, as key executives struggle to get the U.S business back on
track.
TMEsforthecategorydecrease9.5%to$378.5millionin2012from$418.4millionin2011.
Massbrandsmakeupapproximately85%ofTMEin2012.
LOralhasthehighestTMEintheeyemakeupcategory,with$204.2millionin2012,
flatfrom2011.
Procter&Gamble,thesecondlargestadvertiserinthecategorywithonlyitsCovergirl
brand,hasadvertisingexpendituresof$74.2millionin2012,downfrom$101.6million
in2011.
Revlon,adistantthird,decreasesitsTMEto$31.5millionin2012,from$52.2millionin
2011.
DetailsonTMEareprovidedintheAdvertisingsectionofthisreportandonthedatabase.
4A24
EyeMakeup
OUTLOOK
Sales of the eye makeup category are expected to grow reasonably through 2017, and
continueasthesecondlargestmakeupcategory.
The category will see an uptick in television media spending although it decreases in
2012.
Eyemakeupwillcontinuetoseemorepromotionalmarketingviasocialmediaoutlets
byallmarketers.
Addedbenefitstoeyeshadowsandmascaraswilllikelycontinue.
Budgetbrandsinthemassmarketareforecasttocapitalizeonsuccessfullaunchesin
theluxuryspacebybringingfreshnesstothemassmarket.
Mascaraswillcontinuetobethemostsoughtaftereyemakeupproductbyconsumers.
Mascara is a staple and each one offers something different whether thickening,
curling,orlengtheningandisforeseentogrow.
From fashion runways to Grammy winner Adele, the quest for long, thick, and full
lasheswillnotfadeamongwomen.
Thebrushandfibertechnologywillreignfrom2012andthroughtheforecastperiod.
Marketerswillcontinuetoinnovateonthebrushtechnology,withenhancedproduct
formulations,whichmayincludebenefits,suchaslashbuilding,eyelashtreatments,or
primerstodrivesalesanddemandahigherpricepointeveninthemasstradeclass.
Additionally,productsthatincorporatebenefits,suchashairgrowth,orinnovativeskin
care ingredients are likely to foster new growth. Further benefits, such as quicker
dryingtimeandheat/smearresistant,arelikelytocontributetosalesgrowth.
Eye shadow products are forecast to grow almost as fast as mascaras, as women
increasinglyexperimentandaddmorecolortotheirwardrobeofeyeshadows.
Creamy, creaseresistant, long lasting, easytoapply shadows are expected as more
marketersaddtotheirproductlines.Thissingleshadowproductisprojectedtodrive
sales during the forecast period. Also applications, such tubes, sticks, or pots, are
expectedtoincreaseinpopularity.
Marketersareexpectedtolaunchnew,limitededitioneyeshadowcollectionstoadd
incrementalsalesthroughouttheyearandtocreateexcitement.
Eye shadow palettes are forecast to continue to be popular as consumers enjoy the
value proposition, and as marketers include other benefittype products, such as
primers,whichareanticipatedtogrowduringtheforecastperiod.
Newformulationsand deliverymechanismswillcontinuetofuelsales intheeyeliner
segment.
Newshadesincludingglittereyelinersarepredictedtogrowduringtheforecastperiod.
New technology and new shades are expected to continue to drive sales in the
eyebrowcategory,aswellascapturemoreconsumersastheyaddeyebrowmakeupto
theirregimen.
4E25
4E26
EyeMakeup
Salesofeyemakeupareexpectedtogrowat aCAGRof3.1%,reaching$3,160millionby
Table4E15:ForecastManufacturersSalesofEyeMakeupintheUnitedStatesbyProductType,
2012to2017
$Million
Producttype
2012
2017
Mascaras
1,382
1,615
Eyeshadows
677
Allothera
650
%Oftotal
2012
2017
CAGR,%
51.0
51.1
3.2
783
25.0
24.8
3.0
762
24.0
24.1
3.2
Total
2,709
3,160
aIncludeseyelinersandeyebrowproducts.
100.0
100.0
3.1
Duringtheforecastperiod,unitsalesofeyemakeupproductsareexpectedtoincreaseata
CAGRof4.4%from524.9millionpackagesin2012to650.8millionpackagesin2017.
4A26
FACEMAKEUP
CATEGORYPERFORMANCE
Manufacturerssales
Category sales for face makeup grow 3.7% in 2012 to reach $2,909 million at the
manufacturerslevel,whichisslowerthanthe5.6%growthexhibitedin2011.
Facemakeupisthelargestmakeupcategory,with38.0%ofthetotalmakeupproduct
classsalesin2012.
Saleshaveincreasedatcompoundannualgrowthrate(CAGR)of3.0%since2007.
Table4E16:HistoricalSalesofFaceMakeupinthe
Year
$Million
Change,%
2007
2,507
2008
2,537
1.2
2009
2,549
0.4
2010
2,655
4.2
2011
2,804
5.6
2012
2,909
3.7
Mass products contribute to most sales within the face makeup category in 2012, with
42.1%oftotalcategoryssales.Themasstradeclass,up3.3%,barelymaintainspacewith
thetotalcategorysgrowthof3.7%in2012.
Theluxurytradeclassfollowsasthesecondleadingtradeclassin2012,with37.4%of
totalfacemakeupsales.Theluxurytradeclassgrows7.5%toreachto$1,087millionin
2012, from $1,011million in 2011. Sales outpace all major trade classes as makeup
artistbrandsandhigherendbrandsoutperformthetradeclassgrowth.
Directsalesisthethirdlargesttradeclasswithsalesestimatedat$538millionin2012,
down 2.4% from $551 million in 2011. Mary Kay is the largest brand to perform
positivelyinthistradeclassin2012.
4E28
FaceMakeup
Makeupbases,thelargestsegment,continuetocontributetotheoverallcategorysgrowth,
withsalesreaching$2,042millionin2012,up4.0%from$1,960millionin2011.
Newlaunchesinfoundationsaswellasanotheryearofaboveoverallcategorygrowthfor
concealersarethedrivingfactorbehindthegrowthinfacemakeupsales.Concealersales
areup6.8%fueledmostlybyluxurybrandsandlesswithinthemasstradeclass.
Topluxurybrands,includingbutnotlimitedto,MAC,Clinique,BobbiBrownCosmetics,
and Laura Mercier, drive growth in the luxury class, while top mass brands, such as
LOral, Maybelline, and budget brand Eyes Lips Face all grow concealer sales
dramatically.
Table4E17:ManufacturersSalesofFaceMakeupintheUnitedStatesbyTradeClassandBrand,2011and2012
Tradeclass/brand
Company
$Million
MASS
2011
2012
%Oftradeclass
2011
%Oftotal
2011
2012
Covergirl
Procter&Gamble
335
328
28.3
26.8
11.9
11.3
Maybelline
LOral
208
235
17.6
19.2
7.4
8.1
LOralParis
LOral
175
188
14.8
15.4
6.2
6.5
Revlon
Revlon
107
105
9.0
8.6
3.8
3.6
Neutrogena
Johnson&Johnson
72
75
6.1
6.1
2.6
2.6
PhysiciansFormula
PhysiciansFormula
61
62
5.1
5.1
2.2
2.1
Almay
Revlon
59
58
5.1
5.1
2.2
2.1
Wet'N'Wildr
Markwins
24
28
2.0
2.3
0.9
1.0
Rimmel
Coty
25
26
2.1
2.1
0.9
0.9
NYCNewYorkColorr
Coty
13
14
1.1
1.1
0.5
0.5
EyesLipFace
TSGConsumer
Partners
10
0.5
0.8
0.2
0.3
SallyHansen
Coty
0.6
0.6
0.2
0.2
89
86
7.5
7.0
3.2
3.0
100.0
100.0
42.3
42.1
Allother
Totalr
1,185
1,224
LUXURY
Clinique
EsteLauder
185
196
18.3
18.0
6.6
6.7
MAC
EsteLauder
158
173
15.6
15.9
5.6
5.9
Lancme
LOral
112
117
11.1
10.8
4.2
4.2
EsteLauder
EsteLauder
113
115
11.2
10.6
4.0
4.0
Chanel
Chanel
42
46
4.2
4.2
1.5
1.6
BobbiBrown
EsteLauder
40
44
4.0
4.0
1.4
1.5
LauraMercier
Alticor
33
37
3.3
3.4
1.2
1.3
BeneFit
LVMH
30
32
3.0
2.9
1.1
1.1
Shiseido
Shiseido
26
28
2.6
2.6
0.9
1.0
(Continued)
4A28
2012
4E29
FaceMakeup
Table4E17:ManufacturersSalesofFaceMakeupintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
LUXURY(Continued)
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
2012
ChristianDior
LVMH
21
23
2.1
2.1
0.7
0.8
FashionFair
JohnsonPublishing
20
20
2.0
1.8
0.7
0.7
Clarins
Clarins
18
19
1.8
1.7
0.6
0.6
Origins
EsteLauder
17
18
1.7
1.7
0.6
0.6
Nars
Shiseido
14
17
1.4
1.6
0.5
0.6
ElizabethArden
ElizabethArden
14
14
1.4
1.4
0.5
0.5
TrishMcEvoy
TrishMcEvoy
12
13
1.2
1.2
0.4
0.4
SmashboxBeauty
SmashBoxBeauty
Cosmetics
11
12
1.1
1.1
0.4
0.4
Dermablend
LOral
0.7
0.6
0.2
0.2
Prescriptivesa
EsteLauder
111
119
11.0
10.9
5.6
5.9
1,011
1,087
100.0
100.0
36.1
37.4
Allotherr
Totalr
DIRECTSALES
BareEscentuals
Shiseido
199
192
36.1
35.7
7.1
6.6
MaryKay
MaryKay
166
178
30.1
33.1
5.9
6.1
Avon
Avon
97
91
17.6
16.9
3.5
3.1
SheerCover
GuthyRenker
40
39
7.3
7.2
1.4
1.3
Artistry
Alticor
13
13
2.4
2.4
0.5
0.4
Mark
Avon
13
11
2.4
2.2
0.5
0.4
VictoriaJackson
VictoriaJackson
Cosmetics
13
2.4
2.2
0.5
0.1
10
10
1.8
1.9
0.4
0.3
551
538
100.0
100.0
19.7
18.5
Allother
Total
SPECIALTY
VictoriasSecret
LimitedBrands
14
14
29.9
28.6
0.5
0.5
MerleNormanr
MerleNorman
8.3
8.2
0.1
0.1
Privatelabelr
20
22
42.6
44.9
0.7
0.8
Allotherr
19.2
18.4
0.3
0.3
47
49
100.0
100.0
1.7
1.7
70.0
63.6
0.3
0.3
30.0
36.4
0.1
0.1
100.0
0.4
0.4
100.0
100.0
Totalr
PROFESSIONAL
Aveda
EsteLauder
Allother
Total
10
11
TOTALr
2,804
2,909
100.0
aDiscontinued.
rRestated.
4E30
FaceMakeup
Unitsales
Unitvolumeinthecategorygrowsto421.4millionpackagesin2012,upfrom405.2million
packagesin2011.
Unitsgrowsimilartoretailvolume.
Retailsales
Retail sales of the face makeup category are estimated at $4,470million, up 3.7% from
CATEGORYDEVELOPMENT
Markettrends
All face makeup product types contribute to the growth of the category. The luxury class
outperforms all other classes. Complexion products continue to be an important
componentinwomensmakeupregimenastheystriveforaflawlessfinish.
Marketersareusingwords,suchasnudeornakedtoconveythemessageofdelivering
thatflawlessfinish.Benefitlaunchesafoundationproductwithjustthatinthename,
HelloFlawlessOxygenWow.
Liquid foundations continue to be popular in 2012 after several years of powder
minerals at the forefront. Whipped or mousse formulas in foundations make a
comebackin2012.
Mostmarketersincludeaprimerintheirproductmixtoobtainlongerlastingandeven
application,fuelingadditionalsales.
Sunprotectionandantiagingbenefitsinmakeupbasesandpowdersareexpectedin
2012asmostmarketersincorporatethebenefitsorSPFfactorintheproductsname.
Forexample,LOralsVisibleLiftRepairAbsoluteAgeReversingFoundationSPF16.
Concealers grow the fastest in 2012 compared to other face products. There is
excitement in the category with new launches featuring new formulas and/or
applicators. Examples are LOrals True Match Crayon Concealer and YSL Beautes
ToucheEclatRadiantTouch.
Shadematchingprogramsamongmassmarketerscontributetothegrowthinthetrade
class. Luxury brands touted the sheer number of shades in their respective lines to
accommodateallskintones.
Blushersarealsodoingverywellcomparedtoprioryearsasbrandscomeoutwithnew
formats including variation of creams, sticks, liquid, and new and improved powder
formulas. Luxury brands such as Benefit launch lip and cheek kits, while other luxury
brands update their pressed blushers with beautiful designs pressed in powder. It is
expectedthatmorebrandswillusedesignsintheirpressedblushcompactstotempt
womenintobuyingbeautifulblushers.Luminousandsheerarewordsmarketersuseto
describethenewblushers.
The recurring theme or buzzwords used by all brands include flawless perfection,
weightlessandbreathable,lightweightandfresh,aswellascomfortableandhydrating.
4A30
FaceMakeup
Notablenewproducts
Table4E18:SelectNewFaceMakeupProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Clarins
Clarins
EverlastingCompactFoundationSPF15.Awetanddrytexturewhichissaid
toprovideaflawlessfinishandlasts15hours
EsteLauder
BobbiBrown
LongWearEvenFinishCompactFoundation
EsteLauder
Clinique
PoreRefiningSolutionsInstantPerfectingMakeup
EsteLauder
EsteLauder
DoubleWearStayInPlacePowder
EsteLauder
EsteLauder
DoubleWearStayInPlaceConcealerSPF10
EsteLauder
EsteLauder
PureColorSensuousRouge
EsteLauder
MAC
MineralizeBlush&Highlighter
EsteLauder
MAC
MatchmasterFoundationSPF15
Johnson&Johnson
Neutrogena
HealthySkinBrighteningEyePerfectorconcealer
Johnson&Johnson
Neutrogena
ShineControlPrimer
Johnson&Johnson
Neutrogena
ShineControlMakeup
LOral
Lancme
TeintIdoleUltra24Hfoundation
LOral
Lancme
TranslucenceMattifyingSilkyPressedPowder
LOral
LOralParis
VisibleLiftSerumAbsoluteConcealer
LOral
LOralParis
VisibleLiftRepairAbsoluteAgeReversingFoundationSPF16
LOral
LOralParis
TrueMatchLumiHealthyLuminousMakeup
LOral
LOralParis
TrueMatchSuperBlendableMakeup
LOral
LOralParis
TrueMatchCrayonConcealer
LOral
Maybelline
DreamBouncyBlush
LOral
Maybelline
NudeAirfoamMakeup
LOral
UrbanDecay
NakedSkinWeightlessUltraDefinitionLiquidMakeup
LOral
YSLBeaute
LeTeintToucheclatfoundation
LOral
YSLBeaute
ToucheclatRadiantTouchconcealer
LVMH
ChristianDior
DiorskinNudefoundation
LVMH
MakeUpForEver
HDComplexionStarterKit
Procter&Gamble
Covergirl
Covergirl&OlayPressedPowder
Revlon
Revlon
NearlyNakedFoundation
Revlon
Revlon
PhotoreadyAirbrushMousseMakeup
Revlon
Revlon
ColorstayWhippedCremeMakeup
Shiseido
BareEscentuals
ReadySPF20Foundation
Shiseido
BareEscentuals
CorrectingConcealer
TarteCosmetics
TarteCosmetics
MaracujaFoundation
4E31
4E32
FaceMakeup
Salesbyproducttype
Makeupbasescontinuetobethelargestsegmentinthefacemakeupcategorywith4.0%
growthin2012.
The segments growth can be attributed to consumers continued demand for
complexionperfection,aswellasmarketersnewlaunchesinprimers,makeupbases,
andconcealers,toachievethislook.
Facepowder,althoughthesmallestoftheproducttypes,growsthefastestin2012,up
5.1%.Thisisfueledbynewlauncheswithneworimprovedformulations,marketingof
newskincarebenefits,orclaimsforflawlessorvelvetyfinish.
Table4E19:ManufacturersSalesofFaceMakeupintheUnitedStatesbyProductType,2011and2012
Producttype
Makeupbases
Blushers
Facepowders
Totalr
rRestated.
$Million
2011
2012
1,773
1,844
462
476
451
474
2,804
2,909
%Oftotal
2011
2012
63.0
63.4
16.5
16.4
16.1
16.3
100.0
100.0
Change,%
4.0
3.0
5.1
3.7
COMPETITION
Bycompany
Table4E20:ManufacturersSalesofFaceMakeupintheUnitedStatesbyCompany,2011and2012
Company
LOralr
EsteLauder
Procter&Gamble
Shiseido
MaryKay
Revlon
Avon
Allotherr
Totalr
rRestated.
$Million
2011
2012
529
584
531
565
335
328
239
237
166
178
166
163
110
103
222
228
2,804
2,909
%Oftotal
2011
2012
18.9
20.1
18.9
19.4
11.9
11.3
8.5
8.1
5.9
6.1
5.9
5.6
3.9
3.5
7.9
7.8
100.0
100.0
4A32
Change,%
10.4
6.4
(2.1)
(0.8)
7.2
(1.8)
(6.4)
2.7
3.7
FaceMakeup
LOraltakesthetopspotawayfromEsteLauderin2012with20.1%oftotalcategorys
salesin2012.
Sales for LOral grow 10.4% to reach $584million in 2012, up from $529million in
2011. Sales for the company now include sales from Urban Decay, a brand the
companyacquiresfromprivateequityfirmCastaneaPartnersinNovember2012.
LOralsupportsitsfacemakeupbrandsbyincreasingitsadvertisingexpensesby9.4%
to$195.2million,upfrom$178.3millionin2011.
LOralcompetesinthefacemakeupcategorywithLOralParis,Maybelline,Lancme,
UrbandDecay,YSLBeaute,andDermablendbrands.WiththeexceptionofDermablend,
allbrandscontributetothegrowthofthecompany.
Thecompanysmassbrands,MaybellineandLOralParisanditsnewlyacquiredbrand,
UrbanDecay,drivethemajorityofgrowthin2012withdollargainsof13.0%,7.4%,and
52.9%,respectively.
Maybellinecontinuestobetheleadingbrandforthecompanyin2012,with salesof
$235million,upfrom$208millionin2011.
Maybellinesgrowthisdrivenbyallfacemakeupcategories.Concealersalesisfollowed
by makeup bases, and blush sales. New launches, such as Instant Age Rewind Eraser
Dark Spot Concealer + Treatment, Dream Nude Airfoam makeup, and Dream Bouncy
blushfuelgrowth.
LOralsupportsMaybellinesDreamlineofproductswithapproximately$65millionin
traceablemediaexpenditures(TME)in2012.
LOral supports Maybellines Instant Age Rewind line of face products with
approximately$84millioninTMEin2012.
LOral reduces its advertising for its Maybelline Fit Me line from $63 million in TME
duringitslaunchin2011to$7.5millionin2012.
SalesofLOralParisareestimatedat$188millionin2012,up7.4%from$175million
in2011.
LOralParisgrowthisachievedbynewlaunchactivitiesespeciallyinthemakeupbase
categoryasarangeofnewproductshitshelvesin2012.Theseproductsarewithinthe
TrueMatchandVisibleLiftproductlines.
TME for the LOral Paris brand increases in 2012 to $91 million, same as in 2010.
However, TME had dipped in 2011 to $75 million. Approximately, 88% of the dollars
aresplitbetweenpromotingtheTrueMatchandVisibleliftmakeuplinesandcloseto
10%spentontheMagicLumilineoffaceproducts.
TheluxurybrandLancmeachievessalesof$117million,up7.4%from$112millionin
2011. Sales increase due to continuing success of existing products, and to a lessor
extentnewlaunches.Lancmeissupportedwithapproximately$11.5millioninTMEin
2012, up 10% from 2011. These dollars are in support of Teint Idole Ultra 24H
foundation,TeintMiraclefoundation,andlesssoonBlushSubtil.
TheluxurybrandsYSLBeauteandGiorgioArmaniMaestroaresupportedbyclosetoa
halfamilliondollarseach,tosupporttheTouceEclatandliquidfoundationproducts
respectively.
4E33
4E34
FaceMakeup
Este Lauder moves down to second position in the face makeup category in 2012 even
thoughthecompanyincreasesitscategorysharefrom18.9%in2011to19.4%in2012.
SalesofEsteLaudertotal$565millionin2012,up6.4%from$531millionin2011.
TheEsteLauderCompaniesInc.increasesitsadvertisingexpensesto$53.7millionin
2012, up from $34.1million in 2011. Close to 95% of advertising dollars is used to
support its Clinique and Este Lauder brands. Products specifically supported include
CliniquesEvenBetterandStayMatteOilFreefoundationandEsteLaudersDouble
WearandInvisiblefoundationlines.Lessthan1%ofadvertisingexpenditureisusedto
supporttheAerinline,whichincludesblushandlipstick.
Withtheexceptionofthenamesakebrand,EsteLauder,thecompanysluxurybrands
outperformthemarket.Productlaunchesforthebrandin2012arenotenoughtofuel
brandsalesbeyondthe1.8%growth.
The companys two leading brandsMAC and Cliniqueaccount for 65.3% of Este
Lauderstotalfacemakeupsalesin2012.
Thetopperformingbrandsinthecompanysportfolioin2012includeMAC,up9.5%;
Bobbi Brown, up 10.0%; and Smashbox Beauty, up 9.1%. Advertising supports Bobbi
BrownsfoundationandconcealerkitandSmashboxsCameraReadyFoundationand
PhotoFinishFoundationPrimer.
Thenamesakebrand,EsteLauder,hasaninnovativemarketingcampaigncobranding
with the television show, Madmen, to promote a collection including limited edition
lipstickandcrmerouge.Thebrandsupportedthecollectionwithhalfmilliondollarsin
advertising.
In 2012, sales for Aveda and BeautyBank brands remain flat. BeautyBank, sold
exclusivelyatKohls,withbrandsincludingFlirtandAmericanBeautyfacecompetition
fromnewbrand,VeraWang,thatentersKohlsin2012,andElle,whichisalsosoldat
Kohls.
Procter&Gambleisthethirdleadingmarketerinthefacemakeupcategory,withsalesat
Procter&GamblecompetesinthemasstradeclasswithitsCovergirlbrandandwithits
Dolce & Gabbana line within the luxury trade class. Dolce & Gabbanas sales are not
itemizedinthisreport.
Covergirlscategorysharedeclinesslightlyfrom11.9%in2011to11.3%ofsalesin2012,
assalesdeclineacrossallproductcategoriesexceptpowder,whichisfueledbyanew
product,Covergirl&OlayPressedPowder.
In 2012, Procter & Gamble decreases its advertising budget by 8% down to
$87.1million.Approximately68%ofTMEisusedtopromoteCovergirlandOlaySimply
AgelessandToneRehab2in1foundationproducts.CovergirlCleanMakeupandTru
Blendfoundationissupportedbycloseto$24millioninadvertising.
4A34
FaceMakeup
Shiseidoisthefourthleadingfacemakeupmarketerin2012.
Itscategorysharedeclinesfrom8.5%in2011to8.1%in2012.
Salestotal$237millionin2012,downslightlyfrom$239millionin2011.
TheBareEscentualsbrandcontributes$192millioninsalestothecompanyin2012,
butsalesdecline3.5%assalesdipacrossallcategories.
Shiseido increases its TME by 59% for its Bare Escentuals Bare Minerals brand to
approximately $13.2million in 2012. Onequarter of this is used to promote the new
launch of Ready foundation. The namesake brand does not receive TME in 2012;
however,thecompanysotherluxurybrand,CleDePeauBeaute,receivescloseto2%
ofthecompanysTME.
Bare Escentuals launches a new cream foundation, Ready SPF 20 and a correcting
concealer,butsalesarenotenoughtocompensateforthedropinsalesfromexisting
Nars, the makeup artist brand, outperforms other brands within Shiseidos portfolio,
with sales reaching $17million in 2012, up 21.4% from $14million in 2011. Sales are
drivenbythebrandsblushandbronzingpowder.
The Shiseido brand outpaces the overall market performance, up 7.7% to reach
$28million in sales in 2012, up from $26 million in 2011. The brand introduces new
foundationsandlimitededitioncompactpowder.
Mary Kay is the fifthleading marketer in the face makeup category in 2012. In 2011, the
companytiedwithRevlonforfifthplace.
MaryKayssalesreach$178millionin2012,up7.2%from$166millionin2011.Sales
continue to flourish from the companys 2011 launch of Time Wise Luminous and
Mattefoundations.
Revlonisthesixthleadingmarketerinthefacemakeupcategory.
The Revlon brands sales are estimated to be $107million in 2012, down 1.9% from
2011.
RevlonalsocompetesinthemassmarketwithitsAlmaybrand.
Almays sales decline from $59 million in 2011 to $58 million in 2012. Almays sales
declineacrossallcategoriesin2012.
TMEdecreases13%to$44.9millionin2012forboththeRevlonandtheAlmaybrands.
Justover$14millionoftheTMEisusedtopromoteAlmaysSmartShadeandWakeUp
foundations. The Revlon brands TME promotes its Colorstay Foundations (whipped
andliquid),AgeDefyingwithDNAAdvantagefoundation,andPhotoreadyfoundations
(whippedandliquid).
4E35
4E36
FaceMakeup
RETAILDISTRIBUTION
Department stores continue to be the most soughtafter shopping destination for face
makeup as personal consultation and shade matching is a key component for trial and
purchase.
Marketers of mass brands continue to evolve ways in which women can obtain the
perfectshadeviavirtualonlineconsultants,matchingdepartmentstorebrandshades
toproductsintheirmassline.
Some marketers provide free returns on face makeup products when purchased
throughtheInternet.
Specialty stores, such as Ulta and Sephora, continue to obtain more customers with
expandeddistribution.
Table4E21:ManufacturersSalesofFaceMakeupintheUnitedStates
%Oftotal
Retailoutlet
2011
2012
Departmentstores
30
30
Massmerchandisers
24
24
Drugstores
19
18
Directsales
16
15
Specialtystores
10
Foodstores
Professionaloutlets
100
100
Total
MARKETINGACTIVITY
Advertisingandpromotionforfacemakeupproductsvarybytradeclass.
Socialmediamarketingisnowpartofthemarketingmixforallmarketers,nomatter
wheretheproductissold.
ConsumerscanfollowtheirfavoritebrandviaFaceBook,Twitter,and/orTumblr.
Most marketers also have a link on their brands website to YouTube, as well as
Pinterest.Consumerscanwatchhowtovideosandfindthelatesttrendscomealiveby
watching the brands makeup artists applying product to the brands spokesmodels.
ConsumerscanusePinteresttosharethelatestlooksand/orproducts.
Marketers are also using loyalty programs in order to obtain information about their
customersandtotrackpurchasesasawaytogetimmediatefeedbackfromtheirmost
loyalfans.
Blogs continue to be popular both for makeup enthusiasts to share new products,
review products, share coupons, giftwithpurchase (GWP) programs, and Internet
shippingpromotions.
4A36
FaceMakeup
Massbrandstypicallyrelyontheprintandtelevisionmedia,coupons,instoredisplays,and
pricediscounts.
TMEformassbrandsareestimatedtobeapproximately$335millionin2012withjust
underhalfallocatedtotelevision.
Promotional activities for mass brands commonly include pricing discounts and
couponseitherfromthemanufacturerinweeklynewspapersoratlocalretailstores.
Many mass marketers ask the consumer to sign up to its club in order to receive
couponsviaitswebsite.
Mostmassretailersinthedrugstoreandmassmerchandiserchannelsfrequentlyrun
promotionsofferingmakeupproductsatbuyonegetonefreeorbuyonegetone
halfoff.
Fashionmagazinesareoneofthepreferredformsofadvertisingforthefacemakeup
category.Magazinesarealsousedtoprovidesamplesofnewproductsforconsumers
totry.
Brands,suchasCovergirl,usetheirwebsitetohelpmatchfoundationshades.Visitors
can choose a department store brand and the site will provide the Covergirl product
thatmatchesthatproduct.LOrealParisusesavirtualconsultationtotakethevisitor
step by step to provide the right product color and texture for her skin type and
solutionneed.
Procter&GambleusesseveralmediapersonalitiestopromoteitsCovergirlbrand.The
latestspokespeopleincludesingersJanelleMonaeandPink.
Luxury brands typically use instore activities to promote products. However, 2012 sees
muchmoreadvertisingthroughfashionmagazines.
Special events, free makeovers, and consultations continue to be the mainstay for
bringingconsumerstothebeautycountersindepartmentstores.
Retailerscontinuetocarveoutspacetoshowcasesingleitemsacrossallbrandsnear
thecashregistertogetvisitorstoeithertrynewproductsinalargesamplesizeorto
purchaseitemsacrossbrandsthattheymayuseonthego.
RetailerssuchasSephorauseendcapsthatchangemonthlyintheirstorestoshowcase
favoriteand/orhotitems.
Luxurybrandsspend$104millioninTMEin2012.Thesplitisapproximately60%40%,
withthemajorityusedinprintandtheremainderontelevision.
GWPandpurchasewithpurchase(PWP)promotionscontinuetobeusedthroughout
theyeartoshowcasetopsellersandtoprovideasamplingvehiclefornewproductsas
wellasdrawwomentothecounter.
Luxury marketers offer some form of discount or free shipping with a minimum
purchasemadeonthecompanyswebsite.Marketersareincreasinglyluringwomento
buyandreceivefreesampleswhentheyorderonline.
In addition to social media, specialty marketers typically use instore displays, and
activitiestodriveconsumerstoselfservedisplays.
Directmarketerscontinuetorelyontheirsalesrepresentatives,socialmediasites,and
catalogstopromoteproducts.
4E37
4E38
FaceMakeup
Table4E22:SelectExamplesofCouponingActivityforFaceMakeupintheUnitedStates,2012
Company/division
Brand
Promotion
EsteLauder
BobbiBrown
Pickthreesamplesofconcealer,mascara,orBBcreamandfree
shippingwithminimum$65purchase.Freereturnson
foundation,concealer,orpowder.
LOral
LOralParis
$1.00offonanyLOralproduct
LOral
LOralParis
TrueMatchLumifoundationfeaturedinPeoplemagazinethat
teamsupwithamazon.com.Ifyoupurchaseandturninthe
receiptofafeaturedproduct,amazon.comwouldsendouta
$10.00giftcardtothepurchaser
Procter&Gamble
Covergirl
Save$1.00onanyCovergirlproduct
Revlon
Revlon
Save$2.00onanyRevlonPhotoReadyFaceProduct
TheTMEforthefacemakeupcategoryincreasesby1.5%,reaching$437.5millionin2012,
upfrom$430.9millionin2011.
LOral is the leading advertiser in the face makeup category with TME of
Procter&GamblefollowsinsecondplacewithaTMEof$87.1million,down8%from
$95millionin2011.
LuxurymarketerEsteLaudermovesaboveRevlontothirdplace.Itsupportsitsface
makeupbrandswithTMEof$53.7million,up57%from$34.1millionin2011.
Revlonisnowthefourthleadingadvertiser,withTMEof$44.9million,down8%from
$51.8millionin2011.
DetailsonTMEareprovidedintheAdvertisingsectionofthisreportandonthedatabase.
OUTLOOK
Sales of the face makeup category are anticipated to grow at a reasonable rate through
2017 based in part because beauty balms (tracked in facial treatments) are expected to
erodesomefoundationsalesacrossalltradeclasses,whileconcealersandprimersarelikely
tospursales.
Foundationswithmultipleskincarebenefits,aswellasbreathablefeelwilllikelydrive
sales,alongwithnewtechnologyinproductforms.
Mineral powder foundation must tout new benefits, formulas, or ingredients to
reignitethesegment.
As beauty balms currently do no mask all imperfections, it is expected that the
continuationofnewconcealerformatsandformulationswillhelpdrivegrowth.
Shadematchinginthemasstradeclassisforecasttobeprincipaltothehealthofthe
category.
4A38
FaceMakeup
As consumers continue to seek complexion perfection with products that contain

beneficialornaturalskincareingredientsandareweightlesswhilematchingskintone,
thecategoryisexpectedtogrowatahealthyrate.
Inadditiontofoundation,itisexpectedthatadditionalproducts,suchasprimersand
concealerswillbesoughtafter.
It is anticipated that growth will come from two ends of the price spectrum: from
budgetbrands,suchasEyesLipsFace,toluxuryandmakeupartistbrands.
Budgetbrandsareexpectedtolaunchsophisticatedmakeupartisttypeproducts,such
asprimersduringtheforecastperiod.
Additionally, budget brands are marketing hightech ingredients in their packaging to
lure consumers to switch brands, and are expected to continue through the forecast
period.
As consumer confidence improves, consumers are expected to trade up to higher
priced products, as well as make multiple purchases instead of settling for one most
neededproduct.
MarketersareforecasttoincreaseTMEtosupporttheirbrands,aftercuttingwayback
duringtherecessionaryyears.
Massmarketersareexpectedtocontinuewithlargeadvertisingbudgetsandtheuseof
celebrity spokespersons to promote products. Moreover, brands which did not
advertise much or at all in the past have started to increase their print advertising.
ThesebrandsincludeMAC,LauraMercier,andBobbiBrown.BobbiBrown,forthefirst
time,hasacelebrityspokespersoninactressKatieHolmes.
Highlighting powders and sheer blushes are expected as more marketers outside the
nichebrandswillfollowsuittogetconsumersexcitedabouttheblushsegmentagain.
Face powders that provide additional benefits beyond setting makeup or reducing
shineareexpectedtogrowduringtheforecastperiod.Itisexpectedthatpowderswith
light reflection or hydration benefits will help drive sales. Bronzers are expected to
drive sales as marketers extend the shade range and continue to showcase pressed
powdersinprismordesignformatstoobtainshelfappeal.
New blushes with skin care benefits and that are sheer are expected to drive sales.
New innovations in blushes are expected as well, such as those that aid with
hyperpigmentationorcontainhydratingproperties.
Marketers are expected to provide new variations to the traditional pressed powder
blushinforms,suchaswhippedcream,sticks,andliquidtints.Packagingofblushesis
expectedtonotonlybefunctionalbuttobepretty.
Socialmediasiteswillcontinuetohelpdrivesalesasconsumersshareproductreviews,
which can help new brands or products go viral. Video sites will also provide
customerswithtutorialsinordertoachievetheirdesiredlook.
Sales of the face makeup category are forecast to advance at a CAGR of 3.8% to
4E39
4E40
FaceMakeup
Table4E23:ForecastManufacturersSalesofFaceMakeupintheUnitedStatesbyProductType,
2012to2017
$Million
%Oftotal
Producttype
2012
2017
2012
2017
CAGR,%
Makeupbases
2,042
2,484
70.2
70.8
4.0
Facepowders
445
536
15.3
15.3
3.8
Blushers
422
489
14.5
13.9
3.0
2,909
3,509
100.0
100.0
3.8
Total
UnitsalesareexpectedtogrowataCAGRof2.5%from421.4millionpackagesin2012to
488.5millionpackagesby2017.
4A40
LIPSTICKSANDLIPGLOSSES
CATEGORYPERFORMANCE
Manufacturerssales
Categorysalesforlipsticksandlipglossesareclosetotheir2007levels,havingdeclinedata
negativecompoundannualgrowthrate(CAGR)of0.3%since2007.
Table4E24:HistoricalSalesofLipsticksandLipGlosses
Year
$Million
Change,%
2007
1,397
2008
1,311
(6.2)
2009
1,252
(4.5)
2010
1,248
(0.3)
2011
1,352
8.3
2012
1,377
1.8
Manufacturerssalesofthelipsticksandlipglossescategorygrowslowlyat1.8%in2012to
reach$1,377million.
Theslowgrowthrateisduetolacklustersalesinthelipglossandliplinersegments.
Overall,thelipsticksegmentperformswell.
Thebrandsintheluxuryclassfarebetterthanmassbrandsbothinlipstickandlipliner
sales.
Helpingtofuelsalesoflipsticksareinnovativeproductsthattoutlonglastingcolorand
added functionality, such as moisturizing and/or SPF benefits, along with attractive
packaging.
Nourishingingredients,suchasomega3andvitaminEorproductsenrichedwithargan
oiltoconditionandsoftenlips,arehighlightedinthemarketingmaterials.
4E42
LipsticksandLipGlosses
Lipsticks and lip glosses remain an essential category within the makeup products class,
representing 18.0% of the total makeup in 2012, remaining relatively flat from 18.4% of
totalmakeupsalesin2011.
Saleswithinthemasstradeclassdecline2.2%to$538millionin2012.
Themassmarketcontributes39.1%ofsalestothecategory.
LOralisleadingmassmarketerwithbrandsMaybellineandLOralParis.Maybelline
representscloseto17%ofsalestothetradeclassandgrows7.1%in2012.
SalesfortheLOralParisbranddecline5.7%in2012despitenumerouslaunchesand
advertising. LOral Paris is one of the few mass brands that perform well in the lip
glosssegmentwithitsColourRichelipgloss,alongwithbrands,NYColorandRimmel.
It is likely that sales from LOral Paris new Caresse lipstick and Caresse Wet Shine
StainbyColourRichewillfuelsalesin2013.
Maybelline grows 7.1% in 2012, fueled by lipsticks including the Color Sensational
Vividslipstickline.Thebrandslipglossandliplinersalesareflatin2012.
LeadingbrandsRevlonandCovergirlbothdeclineinsalesin2012.SalesfromRevlons
launchofJustBittenKissableBalmStainarenotenoughtocompensatedeclinesinits
Colorstaylipsticklinein2012.CovergirlslaunchofBlastFlipstickBlendableDuolipstick
salesperformwellin2012butisnotenoughtooffsetsteepdeclineswithinitslipgloss
segment.
Manufacturerssalesintheluxurytradeclassgrowby8.1%toreach$494millionin2012,
contributing35.9%tothecategoryssales.TopbrandsincludingMAC,Clinique,andChanel
bringinthemostdollarstofuelgrowthin2012.
MACssignaturelipstickcontinuestoperformwell,asdoesitsnewlaunchesofSheen
Supremelipstick,ProLongwearLipPencil,andProLongwearLipglass.
CliniqueslaunchofChubbyStickspropelssalesforthebrand.
ThelaunchofRougeCocoShinelipstickdrivessalesfortheChanelbrand.
Salesinthespecialtysegmentremainflatin2012with$93millioninsales.
TheVictoriasSecretbrand,whichmakesup62.4%ofthetradeclass,declinesslightly
by1.7%in2012.
Privatelabel brands contribute close to 11% of sales to the specialty segment with
$10millionin2012,up11.1%from2011.TheseincludeUltaandSephorastorebrand
lipsticksandlipglosses.
Direct sales, which represent 17.9% of the categorys sales, are flat in 2012 with sales of
$246million.
MaryKayistheonlytopbrandtogrowsalesforthetradeclass.
AvoncontinuestofalterintheU.S.market,duetomajorchangesintopmanagement
andthefactthattheycontinuetoloseU.S.salesrepresentatives.
4A42
4E43
Table4E25:ManufacturersSalesofLipsticksandLipGlossesintheUnitedStatesbyTradeClassandBrand,2011and2012
Tradeclass/brand
Company
MASS
Revlon
Revlon
125
123
22.7
22.9
9.2
8.9
Covergirl
Procter&Gamble
114
103
20.7
19.1
8.4
7.5
Maybelliner
L'Oral
85
91
15.5
16.9
6.3
6.6
L'OralParis
L'Oral
88
83
16.0
15.4
6.5
6.0
Rimmelr
Coty
19
26
3.5
4.8
1.4
1.9
Wet'N'Wildr
Markwins
22
25
4.0
4.6
1.6
1.8
BonneBell
BonneBell
20
18
3.6
3.3
1.5
1.3
Neutrogena
Johnson&Johnson
13
2.4
1.7
1.0
0.7
EyesLipsFace
TSGConsumerPartners
1.5
1.3
0.6
0.5
Bari/BonBons/LoveMyLIps
Revlon
0.7
0.5
0.3
0.2
Prestige
PrestigeCosmetics
0.5
0.4
0.2
0.1
SallyHansen/NYC
Coty
Allother
$Million
%Oftradeclass
2011
2012
2011
2012
%Oftotal
2011
2012
0.2
0.2
0.1
0.1
48
47
8.7
8.7
3.6
3.4
100.0
100.0
Total
550
538
40.7
39.1
LUXURY
MAC
EsteLauder
80
88
17.5
17.8
5.9
6.4
Clinique
EsteLauder
43
47
9.4
9.5
3.2
3.4
Chanel
Chanel
32
35
7.0
7.1
2.4
2.5
Lancme
L'Oral
31
32
6.8
6.5
2.3
2.3
BobbiBrown
EsteLauder
30
32
6.6
6.5
2.2
2.3
EsteLauder
EsteLauder
28
29
6.1
5.9
2.1
2.1
UrbanDecay
L'Oral
20
22
4.4
4.5
1.5
1.6
ChristianDior
LVMH
14
15
3.1
3.0
1.0
1.1
Origins
EsteLauder
13
14
2.8
2.8
1.0
1.0
Nars
Shiseido
12
14
2.6
2.8
0.9
1.0
SmashboxBeauty
SmashboxBeauty
Cosmetics
10
11
2.2
2.2
0.7
0.8
LauraMercier
Amway
10
1.8
2.0
0.6
0.7
FashionFair
JohnsonPublishing
1.9
1.8
0.7
0.7
Shiseido
Shiseido
1.8
1.8
0.6
0.7
TrishMcEvoy
TrishMcEvoy
1.8
1.8
0.6
0.7
Benefit
LVMH
1.5
1.6
0.5
0.6
YSLBeaute
L'Oral
1.5
1.6
0.5
0.6
Stila
Stila
0.9
1.0
0.3
0.4
Clarins
Clarins
0.9
0.8
0.3
0.3
ElizabethArden
ElizabethArden
0.9
0.8
0.3
0.3
85
89
18.6
18.0
6.3
6.5
457
494
100.0
100.0
33.8
35.9
Allotherr
Totalr
(Continued)
4E44
Table4E25:ManufacturersSalesofLipsticksandLipGlossesintheUnitedStatesbyTradeClassandBrand,2011and2012
Tradeclass/brand
Company
$Million
DIRECTSALES
MaryKay
MaryKay
Avon
Avon
BareEscentuals
Artistry
%Oftradeclass
%Oftotal
2011
2012
2011
2012
2011
107
110
43.5
44.7
7.9
8.0
85
85
34.6
34.6
6.3
6.2
Shiseido
18
18
7.3
7.3
1.3
1.3
Amway
11
11
4.5
4.5
0.8
0.8
Mark
Avon
10
4.1
3.7
0.7
0.7
VictoriaJackson
VictoriaJacksonCosmetics
1.2
0.4
0.2
0.1
12
12
4.9
4.9
0.9
0.9
246
246
100.0
100.0
18.2
17.9
Allother
2012
Total
SPECIALTY
VictoriasSecret
LimitedBrands
59
58
63.4
62.4
4.4
4.2
MerleNorman
MerleNorman
7.5
7.5
0.5
0.5
Privatelabel
10
9.7
10.8
0.7
0.7
Allother
18
18
19.4
19.4
1.3
1.3
100.0
100.0
Totalr
93
93
6.9
6.8
PROFESSIONAL
Aveda
EsteLauder
83.3
83.3
0.4
0.4
Allother
16.7
16.7
0.1
0.1
Total
100.0
100.0
0.4
0.4
TOTALr
1,352
1,377
100.0
100.0
rRestated.
Unitsales
Unit volume sales of the lipsticks and lip glosses category increase 1.0% to 238million
packagesin2012,upfrom235millionpackagesin2011.
Retailsales
Retailsalesoflipsticksandlipglossestotalapproximately$2,119millionin2012,up2.4%
4A44
CATEGORYDEVELOPMENT
Markettrends
Lipsticksperformbetterthanlipglossesandliplinersmostduetofashiontrends,andthe
newformulasavailableonthemarket.
Formulasthatarehybridsoflipsticks,gloss,andstainsareattheforefront.
Longwearinglipsticksthatgoonsheerwithbuildablepigmentsarepopular.
Lipsticks that allow consumers to experiment to create their own look is seen in
advertisements,suchasCovergirlsBlastFlipstickthathascreamycolorononeendand
shimmerycolorontheflipside,withthebenefitofbuildablecolor,theintensityof
whichcanbecontrolledbytheconsumer.
Marketing descriptors of lip products in 2012, includes words such as velvet, deep,
plush, rich, concentrate, vibrant, luminous, sheer, nourishing, luxurious, lightweight,
stain,soft,liquid,intense,andcreamy.LOralParistapsintotheseastheyadvertise
Caresse Wet Shine Stain as a lip color that has it all: lipstain power, touch of shine,
hydratingcomfort,andfreshcolors.
True reds play an important role in 2012 to balance out sultry eyes and even
complexion.
Seasonalityplaysaroleintextureasmarketersshowdeep,rich,velvetytexturesforfall
in crimson, blackest purples, and deepmulled wine colors. And, for spring/summer,
colorsrangefromnudestopalepinksandtotheotherendofthespectrumtoneon.
Allthetopbrandsintheluxurytradeclassperformwellintheproductcategory.
MACcontributesthemostdollarstothetradeclass.Thesecondlargestcontributoris
CliniquewithitsChubbySticklaunch.
Makeupartistbrandsoverallleadthewaywiththehighestgrowth,up10.8%insales
combined.
Traditionalbrands,suchasLancmeandEsteLauderalsoperformwellwithLAbsolu
RougefromLancmeandEsteLaudersPureColorLipstick.
Lipglosssalesdeclinein2012.
Overall, consumers seem to be gravitating toward the new lipsticks as marketers
update thelongstanding tube to slimmer tubes that contain a formula that has high
shine.
Theluxuryclassfaresbetterthanthemasstradeclassduetomanynewlaunchesinthe
segmentfromtopbrandsincludingMAC,Chanel,andBobbiBrown.
Lip liners are up slightly in 2012. Once again, the luxury brands perform better than the
massbrandsin2012.
Higher price points in the luxury market play a significant role in driving sales in the
segment.
Luxury brands that help drive growth in the category include Chanel, Nars, Dior, YSL
Beaute,andUrbanDecay.
4E45
4E46
Notablenewproducts
Table4E26:SelectNewLipsticksandLipGlossesIntroducedintheUnitedStatesin2012
Company
Brand
Description
Amway
LauraMercier
CrmeSmoothLipColor
Avon
Avon
ShineAttractLipstick
Chanel
Chanel
CocoRougeCocoShine
EsteLauder
BobbiBrown
HighShimmerLipGloss
EsteLauder
Clinique
ChubbyStickMoisturizingLipColorBalm
EsteLauder
EsteLauder
PureColorLipstick
EsteLauder
MAC
ProLongwearLipPencil
EsteLauder
SmashboxCosmetics
BeLegendaryLipstick
LOral
Lancme
RougeinLove
LOral
LOralParis
ColorRichBalm
LOral
LOralParis
ColourCaressebyColourRichelipstick
LOral
LOralParis
ColourCaresseWetShineStainbyColourRichelipgloss
LOral
LOralParis
InfallibleLeGloss8hour
LOral
Maybelline
ColorsensationalVividslipstick
LOral
Maybelline
SuperStay10hrStainGloss
LOral
YSLBeaute
RougePurCoutureVenisaLevers
LVMH
Benefit
UltraPlushLipgloss
LVMH
Dior
DiorAddictLipGlow
LVMH
Sephora
PantoneUniverseLipLusterLipstick
ObsessiveCompulsive
Cosmetics
ObsessiveCompulsive
Cosmetics
LipTar
Procter&Gamble
Covergirl
BlastFlipstickBlendableLipDuo
Revlon
Revlon
ColorburstLipButter
Revlon
Revlon
JustBittenKissableBalmStain
Shiseido
Nars
VelvetGlossLipPencil,abutterylipformula,intheformofa
pencilthatprovidesaglossyfinish
Tarte
Tarte
GlamazonPurePerformance12hourlipstick
M&Aactivity
RevlonInc.acquiresbrandsPureIcenailenamelbrand,andBonBonscolorcosmeticsfrom
BariCosmeticsinJuly2012.
borrowings under its 2011 Revolving Credit Facility, along with cash on hand to fund
theacquisition.
4A46
LOral acquires Urban Decay from Castanea Partners, Inc., a private equity firm in
November,2012.Thefinancialdetailsoftheacquisitionisnotdisclosedbutisestimatedto
beashighas$350million.
Salesbyproducttype
Lipsticks are the leading segment in the category, with 70.0% of category sales, reaching
$964millionin2012.
Lipsticksarethefastestgrowingsegment,up3.3%in2012attheexpenseoflipglosses,
asmanylaunchesincludelipstickswithhighshineinslimstickforms.
New packaging in slim cases, fat pencils, and beautiful cases contribute to the
excitementinthelipstickcategory.
Lip liners fare much better in the luxury trade class in 2012 compared to the mass
market.
Lip glosses are up slightly due to higher priced brands in the luxury space while the
segmentfaltersinthemasstradeclass.
Table4E27:ManufacturersSalesofLipsticksandLipGlossesintheUnitedStatesbyProductType,
2011and2012
Producttype
$Million
%Oftotal
2011
2012
2011
2012
Change,%
Lipsticksa
933
964
69.0
70.0
3.3
Lipglosses
311
303
23.0
22.0
(2.6)
Lipliners
108
110
8.0
8.0
1.9
Total
1,352
1,377
aIncludesmultiusesticksandlargepencils.
100.0
100.0
1.8
4E47
4E48
COMPETITION
Bycompany
Table4E28:ManufacturersSalesofLipsticksandLipGlossesintheUnitedStatesbyCompany,
2011and2012
$Million
Company
2011
2012
LOralr
231
236
EsteLauderr
209
Revlonr
2011
2012
Change,%
17.1
17.1
2.2
226
15.5
16.4
8.1
129
126
9.5
9.2
(2.3)
MaryKay
107
110
7.9
8.0
2.8
Procter&Gamble
114
103
8.4
7.5
(9.6)
95
94
7.0
6.8
(1.1)
164
167
34.6
35.0
1.8
1,352
1,377
100.0
100.0
1.8
Avon
Allother
Total
rRestated.
%Oftotal
LOral is the leading marketer in the lipsticks and lip glosses category in 2012. Category
salesforthecompanytotal$236millionin2012,up2.2%from$231millionin2011.
LOralrepresents17.1%ofthecategoryssalesin2012,unchangedfrom2011.
LOral is the leading advertiser, spending $130.8 million in traceable media
expenditures(TME).
LOral competes in the category with its mass brands, LOral Paris and Maybelline,
anditsluxurybrands,Lancme,YSLBeaute,andUrbanDecay.Allbrandscontributeto
the growth of the company in 2012, except LOral Paris. Maybelline adds the most
dollars,whileitsnamesakebranddeclines5.7%in2012.SalesofLOralParisColour
RicheandColourCaresselineofproductsperformwellandaresupportedwithTMEof
$25 million. However, LOral Paris does not fare well with its Infallible lipstick line
despitespending$19millioninTMEin2012.
Salesofthecompanysmassbrandsareuponly0.6%in2012,reaching$174millionin
sales.
Maybellineperformsverywellin2012,withsalesincreasing7.1%toreach$91million
in2012,upfrom$85millionin2011.Thebrandisontrendwithnewlaunchesin2012.
The brand capitalizes on what interests women, the gloss that stays on, and high
pigment lipsticks that stays on and feels creamy. Maybelline launches two new
products: Super Stay 10hour Stain Gloss and Colorsensational Vivids lipsticks. The
launchoftheseproductsissupportedwithcloseto$78millioninTME.
Sales of LOrals luxury brands grow 6.9% in 2012 to reach $62 million from
$58million.BothLancmeandYSLBeautehavesuccessfullaunchesinRougeinLove
andRougePurCoutureVenisaLevers,respectively.Bothproductsaresupportedwith
closeto$9millioninTME.
4A48
Este Lauder Companies is the secondleading marketer in the lipsticks and lip glosses
category,withsalesat$226million,increasing8.1%from$209millionin2011.
EsteLauder,asacompany,holdsacategoryshareof16.4%in2012,upfrom15.5%in
2011.
AllEsteLaudersbrandsgrowin2012.
The companys leading brand, MAC, contributes the most dollars, up 10.0% to reach
$88 million in 2012. MAC launches several new products in this category. Its original
lipstickprovidesadditionaldollarstothebrandssales.
MACallocatesmostofitsadvertisingbudgetof$3.7million,whichisup20%from2011,
to promote its lipsticks and nail polishes using multiplepage print advertisements.
MAC receives editorial pieces for its Marilyn Monroe collection of 29 items including
lipstick.
Clinique is the secondleading brand for the company in the luxury trade class with
salesat$47millionin2012,up9%from$43millionin2011.
TheCliniquebrandissupportedwithcloseto$24millioninTMEin2012.Over90%of
theTMEisusedtopromoteitsChubbyStickproduct.
TheBobbiBrownbrandisup6.7%in2012,reaching$32millioninsalesmostlikelydue
toshadeextensionsacrossalllipproductsandincreasedadvertising.Thebrandsigns
onactressKatieHolmesasitsfirstcelebrityspokesperson.However,salesdeclinefrom
itsdoubledigitgrowthbetween2010and2011.
GrowthofOriginsisup7.7%,totaling$14millionin2012,upfrom$13millionin2011.
The brand capitalizes on trends with a variety of lip products in formats that
consumers desire, such as liquid, chubby pencils, and a nourishing lipstick with its
FlowerFusionproduct.
Este Lauder decreases advertising for its namesake brand in 2012, and uses that
allocatedtopromoteitsPureColorlipstick.
Revlonremainsinthirdplaceinthelipsticksandlipglossescategory,despitea2.3%sales
declinein2012.Companysalesare$126millionin2012,downfrom$129millionin2011.
Revlonhasa9.2%categoryshareofsalesin2012.
Revlon competes in the mass lip category with its Revlon and Bari brands. Although
RevloncompeteswiththeAlmaybrandinothermakeupcategories,Almaynolonger
participatesinthelipcategory.
SalesoftheRevlonbrandslideprimarilyduetothedipinlipglosssalesforthebrand.
Itsliplinerandlipsticksegmentsarerelativelyflat.
The decline in sales, however, is not due to the lack of advertising support from the
company,asthebudgetincreasesover40%to$33millioninTMEin2012comparedto
$23millionin2011.
4E49
4E50
Mary Kay jumps up a rank to become the fourthleading category marketer with 8.0% of
categorysalesin2012,surpassingProcter&Gamble.
Mary Kay is the leading directselling brand in the category, with sales reaching
$110million in 2012, up 2.8% from 2011. This is notable, as the company did not
launchitsnewTrueDimensionlipstickuntillatein2012.Theproductisontrendasitis
toutedasasheer,yetbuildablelipcolorinaluxuriousslimlinepackage.
Procter&Gambledropsdownaranktobecomethefifthleadingmarketerinthelipsticks
andlipglossescategory,withsalesof$103millionin2012,down9.6%from$114millionin
2011.
Themarketeraccountsfor7.5%ofthetotalcategoryssalesin2012,downfrom8.4%
in2011.
TheCovergirlbrand,thesecondleadingbrandinthecategory,istheonlybrandthat
Procter&GamblehasintheU.S.massmakeupmarket.
Manufacturers sales are estimated at $103million in 2012, down 9.6% from
$114millionin2011.
ThecompanydiscontinueditsMaxFactorbrandinearly2010;however,thebrandis
stillsoldinternationally.
Covergirlcompetesinthelipstickandlipglosssegments.Thebrandseesalargedropin
salesamongitslipglossproducts.
Procter & Gamble is the secondlargest advertiser in the category, supporting its
Covergirl brand with $55 million in 2012, down from $78.5 million in TME in 2011.
Television advertising represents about 37% of the brands TME. The remainder is
spentonprintadvertising.
RETAILDISTRIBUTION
Drugstorescontinuetobetheleadingretailchannel;however,theyloseonesharepointto
massmerchandisersin2012.
Department stores remain in second position, as many women continue to seek the
brandsthatareonlyfoundindepartmentstoresfortheirlipstickpurchases.
Table4E29:ManufacturersSalesofLipsticksandLipGlossesinthe
%Oftotal
Retailoutlet
2011
2012
Drugstores
26
25
Departmentstores
24
24
Massmerchandisers
18
19
Directsales
18
18
Specialtystores
11
11
Foodstores
Professionaloutlets
100
100
Total
4A50
MARKETINGACTIVITY
Theadvertisingandpromotionalactivitiesinthecategoryvarybytradeclass.
Approximately $277 million of TME is used to promote brands and products in the
categoryin2012.Ofthat,78%or$217millionisusedtopromotebrandsandproducts
inthemasstradeclass.
Socialmediamarketingisnowanintegralpartofthemarketingmixforallmarketers,
nomatterwheretheproductissold.
Most brand websites include videos to showcase products on models, as well as
tutorials so that consumers can get the look at home. Websites also include links to
sites,suchasFacebook,Twitter,Pinterest,andTumblr.
Blogs, message boards, and reviews on brand websites have increased tremendously
andconsumershavealotofinformationabouttheproductsbeforetheytryand/orbuy
them.
Blogscontinuetoproliferateandareapopularmeansforconsumerstofindcoupons,
dates,andstoreswheregiftwithpurchase(GWP)promotionswillbeheld,aswellas
brandsholdingpromotionsthatofferdiscountshipping.
Massbrandstypicallyrelyonprintandtelevisionmedia,andinstoredisplaycoupons.
Mass retailers in the drug store and mass merchandiser channels frequently use
promotionsofferingmakeupproductsatbuyonegetonefreeorbuyonegetone
halfpricetoencourageadditionalpurchases.
Luxury brands in the lipsticks and lip glosses category rely on editorials, celebrity
endorsements,andinstoreactivitiestopromoteproducts.Companieswithluxurybrands
supportthemwith$55millioninTME.
Veryfewluxurybrandsadvertiseproductsinthiscategoryontelevision.However,in
2012,bothCliniqueandDiorsupporttheirbrandsontelevision.
The promotional activity is generally focused on GWP or purchasewithpurchase
(PWP).Departmentstorescontinuetousethisvehicletobringpotentialcustomersto
thecounter,whilespecialtystoresletconsumerspicksamplestotakehometotrynew
products.
Indepartmentstores,onceconsumersareatthecounter,salespersonnelwillprovide
a makeover, speak of new products, and sometimes, provide the customer with
samplestotakehome.
ChanelandDiorremainpopular,especiallyinthiscategory,asitisarelativelylowcost
for a consumer to experience these brands without the expense of investing in the
brandsiconicfashionlines.
Direct marketers rely mostly on their sales consultants including parties, catalogs, price
discounts,GWPoffers,andsamplingtoachievesales.
Directbrandsrepresent5%oftheTMEforthecategoryin2012.Avonspendscloseto
$1 million in 2012 to promote its Shine Attract lipstick, while Mary Kay spends over
$4millioninTMEtopromoteitsNourishinePlusLipGloss.
4E51
4E52
Leading marketers, including Procter& Gamble, LOral, and Este Lauder, feature many
celebrityspokespersonstoadvertisetheirbrandsandproducts.
Procter & Gambles Covergirl brand features Sofia Vergara for its new Blast Flipstick
lipstick.
LOral Paris runs a series of fivepage print advertising showcasing products in all
makeupsegments.AdvertisementsfeaturemodelsBarbaraPalvinandDoutzenKroes,
andsingerGwenStefani.
MAC uses singer Beth Ditto for its advertisements. MAC also employs a fivepage
magazineadvertisementtoshowcasebothlipsandnailsthatmatch.
LOral is the largest advertiser in the category with combined expenditures for all its
brandsat$130.8millionin2012,aslightdeclinefromthe$134.2millionspentin2011.
LOralspends$60millionontelevisionandover$71millioninprintadvertising.
Maybellineisthehighestadvertisedbrandin2012with$78millioninTME.
LOralParisfollowsasthesecondlargestadvertisedbrandforLOralinthecategory
withTMEof$44.1millionin2012,downfrom$49.8millionin2011.
Procter & Gamble is the third largest advertiser, using $57.1 million to promote the
Covergirlbrandanditsproducts.
Revlon is the fourthlargest advertiser with TME at $32.9 million in 2012, up from
$23.2millionin2011.RevlonusesactressEmmaStonetopromoteitslaunchofJustBitten
KissableBalmStain.
Table4E30:SelectExamplesofCouponingActivityforLipsticksandLipGlossesintheUnitedStates,2012
Company
Brand
Promotion
Coty
Rimmel
$2.00offonanyRimmelLipProductatWalmart
LOral
LOralParis
$1.00offonanyLOralParisproduct
LOral
Maybelline
Save$2.00withthepurchaseofPeoplemagazineandMaybelline
Sensationallipcolor
Procter&Gamble
Covergirl
Save$2.00withthepurchaseofPeoplemagazineandanyCovergirl
Outlastlipcolor
Procter&Gamble
Covergirl
$2.00offwiththepurchaseoftwoCovergirl24HRMascaraand/or
CovergirlOutlastLipColor
4A52
OUTLOOK
Sales of the lipsticks and lip glosses category are anticipated to pick up over the forecast
periodthrough2017ataCAGRof2.4%.
Itislikelythatmarketerswillimprovelipglossformulationstobelesstackywithlonger
wearwiththeuseofstaintechnologyinordertobringwomenbacktothesegment.
It is predicted that lip liners sales will remain relatively flat. Although lip glosses are
expectedtogrowonly1%duringtheforecastperiod,thesegmentssaleswillneedto
risehigherinordertogetbacktopositiveresultsfirst.
During the forecast period, it is anticipated that women will purchase multiple lip
productstocapturetheirmoodsandtotransitionfromdaytonighttimelooks.Kline&
Companyexpectstoseemoreglamourinmakeupasconsumeroptimismrises.
Bold,redlipsarelikelytoremainpopularandarepredictedtostay.
Naturalbrandsarepredictedtogrowastheyimproveshadesandformulas.Retailers
and magazine editorials are more often featuring brands, such as Burts Bees, Josie
Maran,andObsessiveCompulsiveCosmetics.
Trends in lipsticks that are likely to continue and drive newness and growth include
longwearingcolorthatarehighinpigmentandhavetheappearanceofliquid,lacquer,
orhighshine.
Although intense colors will continue to be popular, it is anticipated that a trend for
young,moisturizednudelipswillrunasaparalleltrendoverthenextfewyears.
Products containing natural, moisturizing ingredients, such as but not limited to
maracujaoiland/orargonoilsareexpectedtofuelsalesinthecategory.
Marketerswillcontinuetolaunchnewandimprovedproductswithinnovativeingredients,
improvedapplicators,andpackagingtoinspirewomentopurchase.
Prettyanduniquepackaging,suchasTarteswoodenlipstickpackage,isanticipatedto
becomemoreprevalent,ascasesforlipstickproductscontinuetobeanaccessoryina
womenspurse.
Primers,nowpartofthefacemakeupregimen,maybecomeapartofthelipregimen
forimprovedliptextureandtoensurelongwear.Thesetypeofnewbenefitswilllikely
drivegrowthaspricesincrease.
Ontheotherhand,massmarketers,especiallybudgetbrands,suchasEyesLipsFace
and Rimmel are forecast to promote antiaging benefits similar to luxury brands in
ordertokeepcustomersfromtradingbackuptothebrandsthattheyleftduringthe
recessionperiod.
Marketers that have not used traditional advertising in the past will likely increase
advertising budgets to include magazine advertising, revamping of brand websites,
and/ortheuseofsocialmediaasawaytopromotetheirbrandsandproducts.
Collectionsand/orlimitededitionproductsarepredictedtocontinueasawaytokeep
consumersexcitedaboutthebrandandaswaytospuradditionalproductsales.
4E53
4E54
SalesareexpectedtoforecastataCAGRof2.4%,reaching$1,553millionby2017,upfrom
Table4E31:ForecastManufacturersSalesofLipsticksandLipGlossesintheUnitedStatesby
ProductType,2012to2017
$Million
%Oftotal
Producttype
2012
2017
2012
2017
CAGR,%
Lipsticksa
964
1,118
70.0
72.0
3.0
Lipglosses
303
319
22.0
20.5
1.0
Lipliners
110
116
8.0
7.5
1.1
Total
1,377
1,553
aIncludesmultiusesticksandlargepencils.
100.0
100.0
2.4
Unit volume is forecast to grow at a CAGR of 1.5% from 238 million packages in 2012 to
reach256millionpackagesin2017.
4A54
NAILPOLISHES
CATEGORYPERFORMANCE
Manufacturerssales
Sales of the nail polishes category grow 17.4% to reach $662million in 2012, up from
$564millionin2011.
Nail polishes is the fastestgrowing category in the entire cosmetics and toiletries
industryin2012andhasbeensince2010.
Manufacturers sales increase at a compound annual growth rate (CAGR) of 16.8% since
2007.
Table4E32:HistoricalSalesofNailPolishesintheUnited
States,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
305
307
341
406
564
662
Change,%
0.8
10.8
19.1
39.1
17.4
The nail polish boom continues as marketers provide abundant innovative technologies
withproductsforconsumerstoimitatesaloneffectsinacosteffectivemannerathome.
Theassortmentofnailcolorsandthosewithuniquefinishesandtexturesfromgelto
caviartovelvetandsequinnailscontinuetoaddfreshnesstothecategory.
3D, nail art, and nail appliques offer additional ways to decorate nails with ease
(however,onlythepolishistrackedinthisstudy).
Geltechnologyisoneofthemaindriversinnailpolishin2012.Itisthenewstandard,
andtheunparallellongwearthatgeltechnologydeliversiscatchingonwithconsumers.
OnesuchmarketernewtothegelpolishsegmentisHautePolish,whichoffersaone
stepgelnailpolishsystem.
Matching lips and nails, is gaining some popularity among marketers including MAC,
whichbringsbackatrendfromdecadesago.
Because of the low cost of nail polishes they are an impulse purchase and used to
createandexpressonesownstyleorupdateoneswardrobe.
Luxurybrandsoutperformmassbrand,althoughfromamuchsmallerbase,up25.8%
reaching$39millionin2012from$31millionin2011.Beautybrands,suchasMACand
Lancmedoubletheirnailpolishbusinessin2012.
Massmarketsalesgrowby20.2%in2012toreach$584million.Twothirdsofthetop
massbrandsshowsignificantgrowthin2012.
4E56
NailPolishes
Table4E33:ManufacturersSalesofNailPolishesintheUnitedStatesbyTradeClassandBrand,2011and2012
%Oftradeclass
Tradeclass/brand
Company
2011
$Million
2012
2011
2012
2011
%Oftotal
2012
SallyHansenr
Coty
229
210
47.1
36.0
40.6
31.7
Essie
LOral
31
68
6.4
11.6
5.5
10.3
Revlon
Revlon
38
48
7.8
8.2
6.7
7.3
Sinful
Revlon
26
34
5.3
5.8
4.6
5.1
WetNWild
Markwins
20
34
4.1
5.8
4.6
5.1
PureIce
Revlon
22
25
4.5
4.3
3.9
3.8
LOralParis
LOral
21
0.4
3.6
0.4
3.2
OPIr
Coty
19
21
3.9
3.6
3.4
3.2
Nicoler
Coty
12
19
2.5
3.3
2.1
2.9
NYCNewYorkColor
Coty
10
10
2.1
1.7
1.8
1.5
Maybelline
LOral
10
0.8
1.7
0.7
1.5
Orly
OrlyInternational
1.9
1.5
1.6
1.4
Rimmelr
Coty
1.0
0.7
0.9
0.6
CoverGirl
Procter&Gamble
0.2
0.3
0.2
0.3
Bari/BonBons
BariCosmetics
0.8
0.2
0.7
0.2
HardCandy
FalicGroup
3.2
2.6
0.2
0.2
53
67
11.1
11.6
9.6
10.3
486
584
100.0
100.0
86.2
88.2
MASS
Allotherr
Total
LUXURY
ChristianDior
LVMH
19.4
20.5
1.1
1.2
Chanel
Chanel
22.6
17.9
1.2
1.1
EsteLauder
EsteLauder
9.7
12.8
0.5
0.8
Clinique
EsteLauder
9.7
10.3
0.5
0.6
MAC
EsteLauder
6.5
10.3
0.4
0.6
Lancme
LOral
6.5
10.3
0.4
0.6
ElizabethArden
ElizabethArden
4.9
10.3
0.4
BobbiBrown
EsteLauder
16.1
15.4
0.7
0.8
31
39
100.0
100.0
5.5
5.9
Allotherr
Total
DIRECT
Avon
Avon
MaryKay
Mark
20
18
54.1
62.1
3.5
2.7
MaryKay
21.6
6.9
1.4
0.3
Avon
5.4
6.9
0.4
0.3
18.9
24.1
1.2
1.1
37
29
100.0
100.0
6.6
4.4
10.0
70.0
80.0
1.2
1.2
Allother
Total
SPECIALTY
VictoriasSecret
LimitedBrands
Privatelabel
Allother
Total
TOTAL
20.0
20.0
0.4
0.3
10
10
100.0
100.0
1.8
1.5
564
662
100.0
100.0
4A56
NailPolishes
Unitsales
Unitsalesofnailpolishesgrow16.0%to235millionpackagesin2012,upfrom202million
packagesin2011.
Retailsales
Retailsalesofnailpolishesincrease17.3%from$817millionin2011to$958millionin2012.
CATEGORYDEVELOPMENT
Markettrends
Newcolorscontinuein2012asmostmarketersexpandtheircolorassortment.
Fall colors feature metallic and sparkle as well as colors in cranberry, deep purples,
ruby reds, blue denim, grays, greens, and black, while spring comes with mango,
tangerine,lime,Caribbeanwatercolors,lavender,andpalebabypinks.
Thereseemstobenoendinsightinthemarketofinimitablefinishesonecancreate,
suchasvelvet,rubber,leather,lace,metal,crackle,andglitter.
Atthesametime,theFrenchmanicurewithahintofsparkleaddedtotheendofthe
nail is popular among those who do not want to be too outlandish, but provides a
personaltouch.
Defineyourownstyleistheunderlyingthemein2012.
Retailers,suchasCVSwithNuance,aregettingintothecategoryandthebrandissupported
bySalmaHayekasitsspokesperson.Thebrandlaunchedwith30shades.
CVSalsoputsupkiosksinstorestoserveasaplatformtoshowcasenewproducts.
CotyregeneratesitsOPIbrandconstantlybycreatinglimitededitioncolorcollectionsthat
tie into current trends in movies or television, to bring excitement and draw young
consumerstothebrand.
ForexampleandnotlimitedtoMariahCareycollectionof8chartsmashingshades
inspiredbytheicon,avintageMinnieMousecollection,KardashianKolorwithKendall
&Kylie,anAmazingSpidermancollection,andaJamesBondcollectionforthemovie,
Skyfall.
Maybelline creates a fashion element in its advertisements for its new ColorShow nail
polishes.
Somethemesseenin2012includedenimsheavymetalandrunwayhotshades.
4E57
4E58
NailPolishes
M&Aactivity
RevlonInc.acquiresPureIcenailenamelandBonBonscolorcosmeticsfromBariCosmetics
inJuly,2012.
borrowings under its 2011 Revolving Credit Facility, along with cash on hand to fund
theacquisition.
LOral acquires Urban Decay from Castanea Partners, Inc., a privateequity firm in
November2012.
Thefinancialdetailsoftheacquisitionarenotdisclosed,butestimatedtobeashighas
$350million.
Notablenewproducts
Table4E34:SelectNewNailPolishesIntroducedintheUnitedStatesin2012
Company
Brand
Description
Coty
SallyHansen
NewCompleteSalonManicure
Coty
SallyHansen
New&ImprovedDiamondStrengthNoChipNailColor
Coty
SallyHansen
MagneticNailColor3Dnailartinseconds
EsteLauder
EsteLauder
PureColorVividShinenailpolish
LOral
Essie
Stylenomicsnailpolish
LOral
Essie
LuxEffectsfivemultidimensionaltopcoats
LOral
Essie
Mirrormetallicshades
LOral
LOrealParis
ColourRichenailpolish
LOral
Maybelline
ColorShownailpolish
Procter&Gamble
Covergirl
OutlastStayBrilliantNailGloss
Revlon
Revlon
Brilliantnailpolish
4A58
NailPolishes
COMPETITION
Bycompany
Table4E35:ManufacturersSalesofNailPolishesintheUnitedStatesbyCompany,2011and2012
$Million
Company
2011
2012
Cotyr
275
264
Revlona
90
LOral
%Oftotal
2011
2012
Change,%
48.8
39.9
(4.0)
108
15.9
16.3
20.0
40
104
7.1
15.7
160.0
Markwins
20
34
3.5
5.1
70.0
Avon
22
20
3.9
3.0
(9.1)
EsteLauder
13
1.4
1.9
62.5
OrlyInternational
1.6
1.4
LVMH
1.1
1.2
33.3
Chanel
1.2
1.1
MaryKay
1.4
0.3
(75.0)
Allother
79
93
15.1
15.3
18.8
564
662
100.0
100.0
17.4
Total
aIncludesPureIcesales.
rRestated.
Cotyremainsthedominantnailpolishmarketerin2012witha39.9%shareofthecategory.
Coty competes in the nail polish arena with brands, Sally Hansen, OPI, OPI Nicole,
Rimmel,andNYCNewYorkColor.
Salesforthecompanydeclineby4%in2012to$264millionduetostiffcompetitionin
thecategoryandlackofnewlaunchesfromtheSallyHansenbrand.
OPIandOPINicolecontributethemostdollarstothecompany,butarenotenoughto
offsetthedeclinesornominalgrowthfromtheotherbrandsinthecompanysportfolio.
Nail polishes is the prime category for the marketer, accounting for 64% of its total
makeupsalesin2012.
Sally Hansens sales decline 8.3% in 2012 to $210 million, down from $229 million in
2011.Thebrandaccountsfor79.5%ofCotysnailpolishsalesin2012.SallyHansenhas
two new and improved product launches and the Magnetic nail launch in 2012.
However,thebrandfacescompetitionfromallmarketersinthemassmarket.
TheNicolebrandgrowsby$7milliondollarsin2012.Totalsalesare$19millionin2012,
up58.3%from2011.
SalesofRimmeldecline20.0%to$4millionin2012,downfrom$5millionin2011as
thebrandfocusesitseffortselsewhere.
4E59
4E60
NailPolishes
Cotyssalonbrand,OPIreaches$21millionin2012,up10.5%from$19millionin2011.
OPIs sales growth is attributed to the fact that its polishes do not contain
formaldehyde,dibutylphthalate,ortoluene,gainingacceptancefromconsumerswho
areconcernedaboutthechemicalsusedinmanynailpolishes.
OPI is available in salons, as well as at Sephora, Ulta, JC Penney, and Pure Beauty
retailers (This report covers only products sold for consumers to take home. For
detailed information on professional nail polishes sales, please refer to Kline &
CompanysProfessionalNailCare:GlobalMarketBrief.)
Revlonisthesecondlargestmarketerinnailpolishesandsurpassesoverallmarketgrowth..
Revlonssalesreach$108millioninmanufacturerssalesin2012,up20.0%from2011.
Nailpolishesrepresent18.0%ofRevlonstotalmakeupsales.
RevlonacquiresBonBonsandPureIcefromBariCosmeticsin2012.
PureIcesalesreach$25millionin2012,up13.6%from$22millionin2011.
Sinfulssalesreach$34millionin2012,up30.8%from$26millionin2011.
Revlons share of the category increases to 16.3% in 2012, up from 15.9% in 2011
primarilyduetoitsnewlaunchactivity.
RevlonincreasesitsTMEby57.1%to$19.8millionin2012from$12.6millioninTMEin
2011.OverhalftheexpendituresupportstheColorstaynailpolishline.
LOral retains its position as the thirdlargest nail polish marketer, with sales of
$104millionin2012,up160%from$40millionin2011.
LOralcompetesinnailpolisheswithitsLOralParis,Maybelline,Essie,Lancme,and
YSLBeautebrands.
SalesoftheEssiebrandincreasefrom$31millionin2011to$68millionin2012and
contributethemostdollarsforthecompany.
Essie continues to expand its shade selection to sustain its popularity among
consumersseekingthelatestfashionhues.
Since the acquisition of Essie by LOral in 2011, the brand continues to expand its
distribution.Thebrandissoldindrugstores,massmerchandisersincludingTargetand
Walmart,departmentstores,andspecialtystores,suchasUltaandSephora.
LOral Paris sales grow the most on a percentage basis from $2 million in 2011 to
$21millionin2012.ItssuccesscomesfromthelaunchoftheColourRichenailpolish
line.
Maybellinemorethandoublesitsnailpolishbusinessin2012reaching$10millionin
sales,upfrom$4millionin2011.MaybellinessuccesscomesfromthelaunchofColor
Shownailpolish.
Lancme doubles its nail polish business in 2012 with sales of $4 million, up from
$2millionin2011anddoesnotadvertise.Thebrandssuccesscomesfromthelaunch
ofLeVernisandVernisinLovenailpolishes.
4A60
NailPolishes
MarkwinsWetNWildmovesupasthefourthlargestbrandinthenailpolishescategory
in2012.
Salesareup70.0%in2012toreach$34million,upfrom$20millionin2011.
Thebrandsphilosophyisbasedonfashion,fun,andaffordability.
Thebrandperformsverywellbecausenailpolishisahighimpulsepurchaseproduct,
andthebrandspricepointof$1.99makesiteasyforconsumerstobuy.
Avonslidestothefifthpositionwithdecliningsalesof9.1%in2012.
SalesforAvonareapproximately$22millionin2012,downfrom$20millionin2011.
Avon does not perform well in the nail polishes category because the company as
wholeisstrugglingintheUnitedStatesandthebrandfacesstiffcompetitionfromthe
massmarket.
Avonaccountsforthemajorityofnailpolishessaleswithinthedirectchannelholding
a62.1%sharein2012.
RETAILDISTRIBUTION
Drugstores andmassmerchandisersmaintaina75% shareofthe overallsalesinthenail

polishescategory.
Table4E36:ManufacturersSalesofNailPolishesintheUnitedStates
%Oftotal
Retailoutlet
2011
2012
Drugstores
38
39
Massmerchandisers
37
37
Directsales
Specialtystores
Departmentstores
Foodstores
Professionaloutlets
100
100
Total
MARKETINGACTIVITY
Cotyspends$104milliononitsnailpolishbrands.Traceablemediaexpenditures(TME)for
Cotysnailpolishesareupfrom$63.0millionin2011.Thisfigureincludesspendingforthe
companysSallyHansen,OPI,andNicolebrands.
Magazines are the primary medium used to promote the companys brands and
products.
4E61
4E62
NailPolishes
The Sally Hansen namesake brand is supported with $46.5 million in TME in 2012. About
onethirdoftheexpendituresupportstheSalonEffectsfranchise.
OPI Products receive TME of $43.2 million in 2012, up from $25.3 million in 2011.
About40%oftheTMEsupportsthebrandsGelcolorline.
OPINicoleissupportedwith$13.8millioninTMEin2012.
AllofCotysbrands,andespeciallyOPINicoleuseseasonaland/orlimitededitioncolor
collectionsasawaytomotivateconsumerstodrivesalesandrepurchaseoften.
Coupons are regularly made available in magazines, online, as well as on retailer
shelves.
CotyincreasinglypromotesitsSallyHansenbrandthroughsocialmediasites,suchas
Facebook,Twitter,Pinterestandoffershowtotutorialsonthebrandswebsiteandon
YouTube.
SallyHansenfeaturesanIlovenailartcontesttowincashprizesandatriptoNew
York on its website to promote its products. Viewers can vote through the brands
websiteorthroughPinterestandTwitter.
LOralsupportsitsbrandswith$70.4millioninTMEin2012.
LOralParislaunchofColourRichenailpolishesissupportedby$42.5millioninTME
in2012.
Essieispromotedonsocialwebsites,suchasFacebook,andonecansignuptofollow
thebrandonTwitter.
Essiedoesnotpromoteitsproductswithcoupons.
Essiereceives$30.2millioninTMEtosupportthebrand.Approximately$4.4millionof
theexpenditureisusedtosupportitsLuxeffectslinein2012.
Maybelline receives $17.7 million in TME to support the launch of Color Show nail
polish.
Promotionalvehiclesformassbrandslargelyincludepricediscountsandcoupons.
National mass retailers regularly run promotions offering nail products at buyone
getonefreeorbuyonegetonehalfpricetoinspireadditionalpurchases.
Social media, brand websites, and advertising in womens fashion magazines are the
main marketing means for the nail polishes category. Magazines feature tips from
celebritystylistsonhowtogetthelooksofstars,suchasKatyPerryandBeyonc.
OPIrefreshesitslinebycobrandingorpromotinglimitededitionshades.Forexample,
OPI launched new shades inspired by Bond for the new Skyfall movie and a Vintage
MinnieMousecollection,aswellasinspiredcolorsbysingerMariahCareyandanother
bytheKardashiansisters,KendallandKylie.
RevlonusesactressHalleBerrytoadvertiseitsColorstaynailpolish.
4A62
NailPolishes
Table4E37:SelectExamplesofCouponingActivityforNailPolishesintheUnitedStates,2012
Company/division
Brand
Promotion
Coty
SallyHansen
$5.00offonSalonGelPolishStarterKit
Coty
SallyHansen
$2.00offonanySallyHansennailtreatmentproductwhenyou
buyanySallyHansennailpolish
Procter&Gamble
Covergirl
$3.00offwhenyoupurchasetwoCovergirlnailproducts
Revlon
Revlon
$3.50offonanyRevlonpurchaseof$10.00ormore
Sales representatives and catalogs are used to promote nail polishes through the direct
saleschannelin2012.
OUTLOOK
Thebroadselectionofnailshadesandtexturesisexpectedtoinciteconsumerstowearand
repurchaseoftenasawayofselfexpression.
Other innovations that are likely to drive growth include newer versions of current
trendsthatincludetexturednails,magneticnailpolish,andglitternailpolish.
Innovations in formulas especially in the gel nail segment are also expected to drive
salesinthefuture.
Consumerswillcontinuetoremainsensibleabouttheamountofmoneyspentonsalon
visitsandwillcontinuetoseekoutwaystoobtainthesalonlookwhiledoingtheirown
nails.
Hence,consumersarelikelytoincreasetheirspendingonretailproductstoattainthe
professionalresultsonceobtainedonlythroughsalons.
Gelbasednailpolishesandkitsareanticipatedtogrowasmoremarketerslaunchsuch
products.Thesepolishesandsystemscarryahigherpricepointandwillcontributeto
theoveralldollargrowthforthecategory.
Two brands at either end of the spectrum, Sally Hansen and Chanel, are expected to
launchnewproductstostimulategrowthnotseenin2012.
It is anticipated that marketers will advertise and promote their nail polishes heavily
SalesofnailpolishesareforecasttogrowataCAGRof9.0%toreach$1,019millionin2017,
upfrom$662millionin2012.
UnitsalesarepredictedtogrowataCAGRof8.0%toreach345millionpackagesin2017,
upfrom235millionpackagesin2012.
4E63
4E64
NailPolishes
4A64
4F.ORALCAREPRODUCTS
INTRODUCTION
Oralcareproductscleanseandsoothethemouth,gums,teeth,andlips.Productsincluded
inthissectionare:
Dentureproducts
Mouthwashes
Toothbrushes(manualandbatteryoperated)
Toothpastes
Thisreport excludesoralcaremedications,dentalfloss,electrictoothbrushes,andbreath
fresheners.
MANUFACTURERSSALES
Manufacturers sales of oral care products are up 1.6% from $4,184 million in 2011 to
Toothpastesrepresentthelargestcategorywith41.1%oftotaloralcaresales.
Figure4F1:ManufacturersSalesofOralCareProductsintheUnitedStates,2012
Toothwhitening
products,6%
Denture
products,8%
Toothpastes,41%
Lipbalms,jellies,
andtreatments,9%
Toothbrushes,17%
Mouthwashes,19%
Total:$4,252Million
4F2
OralCareProducts
Since2007,saleshaveincreasedatacompoundannualgrowthrate(CAGR)of1.2%.
Table4F1:HistoricalSalesofOralCareProductsinthe
Year
$Million
Change,%
2007
4,013
2008r
4,154
3.5
2009r
4,114
(1.0)
2010r
4,099
(0.4)
2011r
4,184
2.1
2012
rRestated.
4,252
1.6
Salesbytradeclass
Table4F2:ManufacturersSalesofOralCareProductsintheUnitedStatesbyTradeClass,2012
$Million
Tradeclass
Tooth
pastes
Mass
Mouth
washes
Tooth
brushes
Lipbalms,jellies,
andtreatments
Denture
products
Toothwhitening
products
Total
%Of
total
1,749
799
741
303
318
257
4,167
98.0
Specialty
35
12
47
1.1
Direct
24
26
0.6
Luxury
Total
12
12
0.3
1,749
799
741
374
318
271
4,252
100.0
RETAILSALES
Salesofalloralcareproductsareestimatedat$5,386.8millionattheretaillevelin2012,an
increaseof1.9%from$5,288.8millionin2011.
The top five major marketers competing in the oral care products class control
$3,225millionor75.8%oftheproductclasssalesin2012.
4A2
4F3
OralCareProducts
COMPETITION
Table4F3:ManufacturersSalesofOralCareProductsintheUnitedStatesbyCategoryandCompany,2012
$Million
Tooth
pastes
Mouth
washes
Tooth
brushes
Procter&Gamble
628
187
244
ColgatePalmolive
659
12
180
Company
Johnson&Johnson
Lipbalms,jellies,
andtreatments
Denture
products
Toothwhitening
products
98
200
1,357
31.9
851
20.0
Total
%Of
total
29
354
18
409
9.6
GlaxoSmithKline
242
21
125
406
9.5
Church&Dwight
154
45
202
4.8
Pfizer
79
79
1.9
Sanofi
66
66
1.6
TheCloroxCompany
58
58
1.4
Dr.Fresh
57
57
1.3
Blistex
49
49
1.2
PrestigeBrands
Allother
Total
40
40
0.9
37
159
206
170
55
51
678
15.9
1,749
799
741
374
318
271
4,252
100.0
Procter& Gamble remains the largest marketer of oral care products in 2012, with total
salesof$1,357million,downby2.9%from$1,398millionin2011.
Procter& Gamble contributes 31.9% to the oral care products category share,
comparedto33.4%sharein2011.
Thecompanycompetesinfiveofthesixcategories,notparticipatinginthelipbalms,
jellies,andtreatmentscategory.
Some of the key factors that contribute to the marketers decline in the oral care
marketin2012includelimitednewproductactivity,adecreaseincouponingactivity,
andadecreaseinthemarketingandadvertisingsupportforitsbrands.
Procter&GambledecreasesitsTMEtosupportitsbrandsintheoralcareproductclass
significantlyby21.6%from$269.3millionin2011to$211.2millionin2012.
Procter&Gambleistheleadingmarketeroftoothbrushesandtoothwhitenersandis
thesecondleadingmarketeroftoothpastes,mouthwashes,anddentureproducts.
The company is the leading marketer of tooth whitening products, with a significant
lead over other marketers in the category. Sales for the marketer in the tooth
whiteningcategorydeclineby5.7%from$212millionin2011to$200millionin2012.
Higherpricepointscomparedtocompetitorsresultsinsalesdeclineforthemarketerin
thecategory.
Procter&Gamblemaintainsitsleadershipintoothbrushes,itssecondlargestproduct
category.Salesdecreaseby4.3%,from$255millionin2011to$244millionin2012for
themarketerinthetoothbrushescategory.
Procter & Gamble, well known for its product innovations, experiences lesser
innovations and new product activity in 2012 limiting the marketers growth in the
category.
4F4
OralCareProducts
ThecompanylosesitsgroundtoColgatePalmolivein2012tobecomethesecondleadingin
thetoothpastescategory.
Salesofthecompanydeclineby2.9%from$647millionin2011to$628millionin2012.
Procter & Gambles increase in price for its products in 2012 is also a major factor
contributingtoitssalesdeclineinthecategory.
ColgatePalmolive is the secondlargest marketer in the oral care market, with sales of
ColgatePalmoliveholds20.0%shareoftheclassin2012,upfrom19.2%in2011.
The company competes in the three largest product categories in the oral care
products class: toothpastes, mouthwashes, and toothbrushes. ColgatePalmolive
focusesonthetoothbrushesandtoothpastescategories,withover98%ofitstotaloral
caresalescontributedbythesetwocategories.
The company replaces Procter & Gamble to become the leading marketer in the
toothpastescategoryin2012.
ThemarketerprimarilybenefitsfromthesuccessofitsOpticWhiterangeoforalcare
productsin2012.
Thenewtrendwhiteninghelpsthecompanygrowitssalesin2012 andstrengthen
ColgatePalmolivespositionintheoralcaremarket.
Salesoftoothpastes,accountingfor77.4%ofthecompanystotalsalesintheoralcare
market,increaseby5.9%in2012.
Thecompanyregisters8.4%growthinthetoothbrushescategory.
The success of the Colgate Optic White range of oral care products, which includes
toothbrushes,contributesdirectlytothecompanysgrowth.
In2012,Johnson&Johnsonremainsthethirdlargestmarketerintheoralcaremarketwith
Thecompanyholds9.6%shareoftheclassin2012,slightlydownfrom9.7%in2011.
The company participates in four of the six categories including mouthwashes,
toothpastes,toothwhiteningproducts,andlipbalms,jellies,andtreatmentscategories
intheoralcaremarket;however,86.5%ofitstotalsalescomefromthemouthwashes
segment.SalesofJohnson&Johnsoninthemouthwashescategorygrowby1.1%,from
Johnson& Johnsons Listerine is still the undisputed leader in the mouthwashes
categorywith44.3%ofthetotalcategorysales.
In the mouthwashes category, Listerines sales grow 1.2% from $336 million to
$340million in 2012. Growth of the Listerine brand is supported by the strong
performanceofitsalcoholfreevariantsListerineZeroandTotalCare.
ThemarketersellsitsReachbrandofmanualtoothbrushestoDr.Freshin2012foran
undisclosedamount.
4A4
OralCareProducts
GlaxoSmithKline is in fourth place, with total sales increasing 4.9% from $387million in
GlaxoSmithKline participates in five categories in the oral care products market, not
participating in the lip balms, jellies, and treatments category. The company has a
majorpresenceinthedentureproductsandtoothpastescategories,contributingabout
90.4%ofthecompanystotalsalesintheoralcaremarket.
GlaxoSmithKline is the leading marketer of denture products and the thirdleading
marketeroftoothpastes.
In 2012, GlaxoSmithKlines sales in the denture products category increase 7.8% to
$125million from $116 million in 2011. The companys growth in the category is
supported by introduction of a new adhesive, Poligrip for Partials. The marketer
removes zinc from its Poligrip brands to promote its sales in 2012 as zinc in denture
productsisexpectedtoleadtohypocupremia,hyperzincemia,orneuropathy(damage
isanervedisorder).
Church&Dwightholdsthefifthpositionintheoralcaremarket,contributing$202million
insales,down3.8%from$210millionin2011.
The company competes in the toothpastes, toothbrushes, and tooth whitening
products categories, with a very small presence in the tooth whitening products
category.
Thecompanysmarketsharedeclinesto4.8%ofthetotalproductclasssalesin2012
from5.0%in2011.Themarketsharedeclineisdrivenprimarilyduetotheslidingsales
inthetoothbrushescategory.
Lack of new product activity and a decrease in marketing activity limits Church&
Dwightssalesintheoralcareproductclass.
ToothpastesarethestrongestcategoryforChurch&Dwight,accountingfor76.2%of
thecompanystotaloralcaresales.
RETAILDISTRIBUTION
Mass merchandisers are the leading retail channel for oral care products in 2012, with
43.7%ofsales.
Foodstoresranksecond,with31.4%ofthesalesshare.
4F5
4F6
OralCareProducts
Table4F4:SalesofOralCareProductsintheUnitedStatesbyRetailOutlet,2012
Retailoutlet
%Ofmanufacturerssales
Denture
products
Lipbalms
Mouth
washes
Tooth
whitening
Tooth
brushes
Tooth
pastes
Weighted
average
Massmerchandisers
39
33
46
49
46
44
43.7
Foodstores
32
20
29
19
31
37
31.4
Drugstores
29
27
25
28
22
18
22.3
Specialtystores
11
1.6
Directsales
0.6
Professionaloutlets
0.2
Departmentstores
Total
0.2
100
100
100
100
100
100
100.0
OUTLOOK
The oral care market is mature and will experience moderate growth of 1.2% over the
forecastperiod.
Toothpastes,mouthwashes,andtoothbrushes,thethreelargestcategoriesintheoral
careproductsclasswithacollectiveshareof77.4%,willdrivetheoverallmarket.
Multibenefitproductsacrossallthecategorieswilldrivethesalesoforalcareproduct
Several leading marketers, including Procter & Gamble and ColgatePalmolive, are
expectedtolaunchmoreinnovativeproductstosupportthegrowth.
The largest category in the oral care product class, toothpastes is expected to experience
slowandsteadygrowthof1.2%overtheforecastperiod,2012to2017,supportedbynew
productlaunches.
Marketers are expected to introduce more innovative or multibenefit products to
supporttheirsalesgrowth.
Companies are also expected to launch products pertaining to specific oral care
problemsincludingsensitiveteeth,protectionagainstplaque,anddrymouth.
Marketersareexpectedtocontinuewithstrongpromotionalsupportfortheirbrands
overtheforecastperiod.
New manufacturers, such as Hello Products, Kiss My Face, and other niche personal
careandcosmeticcompanies,areexpectedtolaunchinnovativenewproductsinthe
category,givingconsumersmorealternatives.
Traditional product options are expected to decline as companies turn to better
technologieswithimprovedformulations,multibenefitproductintroductionstogrow
marketshare.
Productstargetingagegroupsincludingchildrenandteensareexpectedtoexperience
growth, as marketers such as Procter & Gamble and Sunstar Americas continue to
launchsuchproductsinthecategory.
Toothpastes are used bya vast majority of adults and children to maintain good oral
health,makingitsmarketpenetrationhigh.
4A6
OralCareProducts
The mouthwashes category, second largest in oral care, is mature and will experience
relativelylowsalesgrowthoverthenextfiveyears.
Salesforthecategoryareexpectedtogrowby1.4%overthenextfiveyears.
Mouthwashesthatoffermultibenefitssuchasteethwhitening,protectionagainstbad
breath,andenamelprotectionareexpectedtosupportthecategorygrowthoverthe
forecastperiod.
Mouthwashes that are positioned to provide better results such as killing germs are
expectedtoseegrowthovertheforecastperiod.
New product innovations with better formulas will cater to the growth of
mouthwashesintheforecastperiod.
Better promotional and advertisements support for the mouthwashes category will
supportthesalesgrowthofthecategory.
Privatelabel products with continuous improvements in quality and pricing are
expectedtopostsalesgrowthinthecategoryovertheforecastedperiod.
However, the mouthwashes category will continue to face stiff competition from
toothpasteswithallinonebenefits.
Salesoftoothbrushesareexpectedtogrowataslowbutsteadyrateof1.6%overthenext
fiveyears.
Products with better technology and lower price are expected to grow over the
forecastperiod.
Marketerswillcontinuetolaunchnewandcreativeproductswithmultiplebenefits,to
keeppacewiththegrowthinconsumerdemandandexpectations.
Themanualsegmentwillexperiencegreatergrowthinthechildrenssegmentandless
intheadultsegment,drivenmainlybyinnovations,andbettermarketingstrategies.
Products that are designed for specific problems, including gum massage, plaque
removal,anddeepcleaningareexpectedtoseegrowth.
Marketers are expected to increase their marketing activity to support the category
salesovertheforecastperiod.
Factorsincludinglowpriceandnewproductlauncheswillsupportthesalesofprivate
labelproductsovertheforecastperiod.
Thelipbalms,jellies,andtreatmentscategoryisexpectedtopostmoderategrowthof1.9%
As the presence of lip care products increase across distribution channels, especially
massmerchandisers,thecategoryssalesarelikelytoincrease.
Sales of highpriced lip balms with additional benefits such as antiaging are likely to
increaseandsupportthecategorysgrowth.
Marketersarelikelytoadoptnewstrategiessuchaspackageinnovationsandtrialsizes
toattractnewcustomers.
New product introductions, particularly focused on products that improve lip quality,
willdriveconsumerinterest.
Tinted lip balms are likely to witness sales increase as they compete directly against
lipsticksandlipglosses
However,otherfactorswillhindergreaterexpansion,includingchangingfashions,the
continued inability of marketers to target older consumers, and continued consumer
belttightening.
4F7
4F8
OralCareProducts
Sales for denture products are expected to grow moderately by 0.3% over the forecast
periodsupportedbyacontinuousincreaseintheaverageageofAmericans
An aging population and new product innovations are expected to drive the sales of
dentureproductsovertheforecastperiod.
With growth in the dental accessories category, cleansing brands may also see
moderategrowthifthemarketerscanpositioncleansingproductsforuseinthisarea.
However, sales in the category will be limited by certain factors, including the wider
useofpermanentimplantsandimprovementinoralcare.
Thematuringtoothwhiteningproductscategoryisexpectedtodeclinemarginallyby0.5%
The tooth whitening category growth will be limited by stiff competition from
whiteningtoothpastesandmouthwashes.
The continual introduction of new toothpastes and mouthwashes with claims of
whiteningwillcontinuetoposestrongcompetitiontothetoothwhiteningproducts.
However,otherfactorsthatwillhelpdrivethe salesofthecategoryinclude;product
innovations, introduction of products in new formats such as gels and pens, and
whiteningproductsthatwilloffermultibenefitssuchasprotectionagainstenamelor
gums.
SalesoforalcareproductsareforecasttogrowataCAGRof1.2%,from$4,252millionin
2012to$4,510millionin2017.
Unit sales of oral care products are forecast to rise at a rounded CAGR of 0.9% from
1,816millionunitsin2012to1,895millionunitsin2017.
Table4F5:ForecastManufacturersSalesofOralCareProductsintheUnitedStatesby
Category,2012to2017
$Million
Category
2012
Toothpastes
2017
1,856
1.2
Mouthwashes
799
856
1.4
Toothbrushes
741
802
1.6
374
410
1.9
Dentureproducts
318
322
0.3
271
264
(0.5)
4,252
4,510
1.2
4A8
CAGR,%
1,749
Total
OralCareProducts
Table4F6:ForecastUnitSalesofOralCareProductsintheUnitedStatesbyCategory,2012to
2017
Millionpackages
Category
2012
Toothpastes
CAGR,%
1,005
1,046
0.8
Toothbrushes
349
366
1.0
Mouthwashes
192
203
1.1
165
175
1.2
Dentureproducts
88
89
0.2
17
16
(1.2)
1,816
1,895
0.9
Total
2017
4F9
4F10
OralCareProducts
4A10
DENTUREPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
In2012,salesfordentureproductsintheUnitedStatesgrow1.3%to$318million,upfrom
$314millionin2011.
Since2007,totalsalesofdentureproductshavecontractedatacompoundannualgrowth
rate(CAGR)ofadeclining0.1%peryear.
Table4F7:HistoricalSalesofDentureProductsintheUnited
States,2007to2012
Year
$Million
Change,%
2007
320
2008
320
2009
319
(0.3)
2010
320
0.3
2011
314
(1.9)
2012
318
1.3
Unitsales
Unit sales of denture products grow by 0.8% to about 88million units in 2012, up from
85millionin2011.
Retailsales
In 2012, retail sales of denture products are approximately $441.3million in the United
States,up1.2%from$436millionin2011.
Dentureadhesivesaccountfor$277million,whiledenturecleanserscontributeabout
$165milliontothetotalretailsales.
4F12
DentureProducts
Table4F8:ManufacturersSalesofDentureProductsintheUnitedStatesbyTypeandBrand,2011and2012
Producttype/brand
Company
%Ofproducttype
2011
$Million
2012
2011
2012
2011
%Oftotal
2012
DENTUREADHESIVES
Fixodent
Procter&Gamble
99
96
51.0
48.2
31.5
30.2
PoliGripa
GlaxoSmithKline
65
74
33.5
37.2
20.7
23.3
SeaBond
Combe
20
20
10.3
10.1
6.4
6.3
Wernets
GlaxoSmithKline
1.5
1.5
1.0
0.9
Effergrip
PrestigeBrands
1.0
0.5
0.6
0.3
Privatelabel
1.5
1.5
1.0
0.9
Allother
1.0
1.0
0.6
0.6
194
199
100.0
100.0
61.8
62.6
Total
DENTURECLEANSERS
Polidentb
GlaxoSmithKline
25
25
20.8
21.0
8.0
7.9
Efferdent
PrestigeBrands
26
23
21.7
19.3
8.3
7.2
PolidentOvernight
GlaxoSmithKline
16
16
13.3
13.4
5.1
5.0
EfferdentPlusc
PrestigeBrands
11
12
9.2
10.1
3.5
3.8
SmokersPolident
GlaxoSmithKline
2.5
2.5
1.0
0.9
DentuCrme/Gel/Foam
GlaxoSmithKline
2.5
2.5
1.0
0.9
Fixodent
Procter&Gamble
3.3
1.7
1.3
0.6
FreshNBrite
RevivePersonal
Products
1.7
1.7
0.6
0.6
EfferdentPowerCleanCrystals
PrestigeBrands
1.7
0.6
EfferdentPM
PrestigeBrands
0.8
1.7
0.3
0.6
PolidentforPartials
GlaxoSmithKline
0.8
0.8
0.3
0.3
Privatelabel
23
23
19.2
19.3
7.3
7.2
Allother
4.2
4.2
1.6
1.6
100.0
38.2
37.4
100.0
100.0
Total
120
119
100.0
TOTAL
314
318
aIncludesSuperPoliGrip,PoliGripUltraFresh,PoliGripFree,andSuperPoliGripComfortSealStrips.
bIncludesPolidentPowderandPolidentFreshCleanse.
cIncludesListerineFreshEfferdentPlusandEfferdentPlusWithFreshBurstListerineMouthwash.
CATEGORYDEVELOPMENT
Markettrends
Thedentureproductscategoryismaturewithlimitednewproductactivityin2012.
Sales grow marginally by 1.3%, supported by new product introductions by leading
marketersincludingPrestigeBrandsandGlaxoSmithKline.
PrestigeBrandslaunchesanewproduct,EfferdentPowerCleanCrystalsinearly2012.
GlaxoSmithKlinelaunchesanewdentureadhesive,PoligripforPartials.
4A12
DentureProducts
The growing number of denture wearers in the United States supports the categorys
growth.
Itisestimatedthatthereareapproximatelymorethan35milliondenturewearersin
theUnitedStatesin2012.
Salesofthecategoryarealsosupportedbytheagingpopulation,whoneedtoreplacelost
teeth.
The U.S. population continues to age, with approximately 43million persons aged 65
andolderasof2012.
GrowthisinhibitedbythefactthattoothlessnessintheUnitedStatesisafadingproblem,
andmostbabyboomersarepredictedtoretainmajorityoftheirteeththeirentirelives.
Improved toothbrushes, toothpastes, and broader use of professional services
contributetothisphenomenon.
Expandedinsurancecoveragefordentalservicesandanincreasedfocusonhealthand
wellnessforseniorsalsocontributetobetterdentalhygiene.
With the recent advances in dental technology, most consumers opt for permanent
implants.Therearealsopredictionsthatadultstemcellswillbeusedtoregenerateor
grownewteethwithinthenextdecade.
However, the dental accessories market continues to grow, as denture cleansers expand
theirscopefromdenturesonly,toencompassthisbroadercategory.
Notablenewproducts
Table4F9:SelectNewDentureProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
GlaxoSmithKline
Poligrip
PoligripSeal&Protectadhesivestabilizespartialproblemsand
reducespotentialproblemsinthefuture
PrestigeBrands
Efferdent
EfferdentPowerCleanCrystalsdenturecleanserreducesplaque
buildupandremovesfoodparticlesthatcancausegumirritation.
Helpsremovetoughstainsfromhardtoreachplaces
4F13
4F14
DentureProducts
Salesbyproducttype
Denture adhesives is the larger segment in the category and accounts for roughly 63% of
totalcategorysales,whiledenturecleansersrepresenttheremaining37%.
Salesofdentureadhesivesareupslightlyin2012by2.6%,from$194millionin2011to
$199millionin2012.
Thesalesofdenturecleansersaredownslightlyby0.8%in2012,from$120millionin
Fixodentdentureadhesivescontinuetoloseshare,withsalesdownover3%in2012,
resulting from a decrease in the promotional and advertising support for the brand.
Thebrandremainstheleaderinadhesiveproductsatjustunder50%ofthesegment
sales.
PoliGripistheonlybrandtogrowin2012,withsalesupbyalmost14%.Thebrandalso
gainsmarketshareduetothedropinFixodentssalesin2012.Introductionofanew
variant, Poligrip for Partials without Zinc, in the denture adhesives segment supports
thesalesgrowthofPoligripin2012.
Denture products containing zinc gained wide publicity in 2011 for causing
hypocupremia,hyperzincemia,andneuropathy(damagetothenerves).
Denturecleansersalesdeclineslightlyduringtheyear.GlaxoSmithKlinesPolidentand
PrestigeBrandsEfferdentremainthelargestplayers.
Intermsofindividualbrands,Polidentsbrandssalesremainflatin2012,butsalesfor
the Efferdents brands grow slightly by 2.6%, supported by the launch of Efferdent
PowerCleanCrystalsinearly2012.
Table4F10:ManufacturersSalesofDentureProductsintheUnitedStatesbyProductType,
2011and2012
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Change,%
Dentureadhesives
194
199
61.8
62.6
2.6
Denturecleansers
120
119
38.2
37.4
(0.8)
Total
314
318
100.0
100.0
1.3
4A14
DentureProducts
COMPETITION
Bycompany
Table4F11:ManufacturersSalesofDentureProductsintheUnitedStatesbyCompanyand
Segment,2011and2012
$Million
Company/segment
%Oftotal
2011
2012
2011
2012
Adhesives
68
77
21.7
24.2
Cleansers
48
48
15.3
15.1
116
125
36.9
39.3
Adhesives
99
96
31.5
30.2
Cleansers
1.3
0.6
103
98
32.8
30.8
Cleansers
38
39
12.1
12.3
Adhesives
0.6
0.3
40
40
12.7
12.6
20
20
6.4
6.3
0.6
0.6
Cleansers
28
28
8.9
8.8
Adhesives
1.6
1.6
Total
33
33
10.5
10.4
TOTAL
314
318
100.0
100.0
GLAXOSMITHKLINE
Total
PROCTER&GAMBLE
Total
PRESTIGEBRANDS
Total
COMBE
Adhesives
REVIVEPERSONALPRODUCTS
Cleansers
ALLOTHER
GlaxoSmithKlineandProcter&Gambleremainthecategoryleaders,collectivelyaccounting
forover70%ofcategorysalesin2012.
4F15
4F16
DentureProducts
In2012, salesforthecategoryleaderGlaxoSmithKlineincrease7.8%to$125millionfrom
$116millionin2011.
GlaxoSmithKlineconstitutes39.3%ofthemarketsharein2012,upfrom36.9%in2011.
GlaxoSmithKline is the secondleading marketer of denture adhesives, behind
Procter& Gamble, capturing almost onequarter of the categorys market share in
2012.Thecompanysdentureadhesivessalesrisebynearly$9millionduringtheyear.
The companys growth in the denture adhesives segment is supported by the
introductionofanewadhesive,PoligripforPartials.
ThemarketerremoveszincfromitsPoligripbrandstopromoteitssalesin2012aszinc
indentureproductsisfoundtocausehealthproblems.
Dentureadhesivesaccountforabout62%ofthecompanysdentureproductsales.
GlaxoSmithKline continues to be the leading marketer of denture cleansers in 2012,
withover40%segmentshare.Polidentisthetopbrandinthesegment.
Procter&Gamblessalesdropby$5millionto$98millionin2012.
FixodentistheonlybrandmarketedbyProcter&Gambleinthecategory.
Thecompanystotalmarketsharedecreasesslightlyto30.8%in2012,from32.8%in
2011.
Procter& Gamble decreases its advertising and promotional support for its Fixodent
brandin2012,leadingtothesalesdecline.
Lack of new product activity also offsets the growth of the brand in the category in
2012.
Fixodent, the top brand in the denture adhesives segment, drops by 4.9% in 2012 to
$96million.
Prestige Brands maintains its sales unchanged in the category, at $40million in 2012, the
sameasin2011.
Efferdentisamajorplayerinthedenturecleanserssegment.In2012,salesgrow2.6%
to $39million from $38million in 2011, supported by the success of its new launch,
EfferdentPowerCleanCrystalsinearly2012.
The sales of Effergrip decline by $1million in 2012. Effergrip is a small brand in the
dentureadhesivessegment.
Privatelabel
Privatelabel products contribute to sales of $26million or 8.2% of the categorys sales in

2012,withsalesbeingthesameasin2011.
Privatelabelproductsareprominentinthedenturecleanserssegmentwith19.3%or
approximately onefifth the share of the segments sales in 2012. Privatelabel sales
rank third, following GlaxoSmithKlines Polident and Prestige Brands Efferdent in the
denturecleanserssegment.
Inthedentureadhesivessegment,privatelabelproductsaccountforjust$3millionin
sales,capturing1.5%marketsharein2012.
4A16
DentureProducts
RETAILDISTRIBUTION
As in 2011, mass merchandisers remain the most important distribution channel for
dentureproductsin2012.
Massmerchandisersarethemostsignificantdistributionchannelwith39%ofsales.
Sharesoffoodstoresanddrugstoresarealsounchangedat32%and29%,respectively,
in2012.
Table4F12:ManufacturersSalesofDentureProductsinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
39
39
Foodstores
32
32
Drugstores
29
29
100
100
Total
MARKETINGACTIVITY
GlaxoSmithKlineremainstheleadingadvertiserinthedenturescategoryin2012withmore
than$18.9millionintraceablemediaexpenditures(TME)foritsproducts.
ThecompanymarketsfourbrandsinthecategoryincludingPoliGrip,Polident,Dentu
Crme, and Wernets. In 2012, PoliGrip receives almost TME of $12.8 million, and
Polidentreceives$6.1millionTME.
Thecompanyallocatesitsentireadvertisingbudgettotelevision,withnoneallocated
totheprintmedia.
Themarketeralsooffersdiscountcouponsof$1.00onitsPolidentandPoligripbrands.
However, GlaxoSmithKlines 2012 spending is 9.1% lower than its 2011 TME of
$20.8million.
CombehasthesecondlargestTMEinthecategory.
TMEforitsSeaBonddentureadhesiveproductisabout$3.8millionin2012,downby
24.0%from$5millionin2011.
In 2012, the company spends its total advertising budget on television, with none
allocatedtotheprintmedia.
4F17
4F18
DentureProducts
Procter&GambleranksthirdinTMEin2012,allocating$1.5millioninTMEtoFixodent.
Television advertisements remain the most preferred promotional method for the
marketerinthecategory.
Procter&Gambles2012advertisingspendisalmost77%lowerthanits2011TMEof
$6.5million.
Virtually, all of the marketing budget is spent on television advertisements and
syndicatedpromotions.
Themarketeralsooffersdiscountcouponsof$1.00onitsFixodentbrand.
TMEbybrandareincludedintheAdvertisingsectionofthisreport.
OUTLOOK
Sales for denture products are expected to grow marginally by 0.3%, over the forecast
periodsupportedbyacontinuousincreaseintheaverageageofAmericans.
Agingpopulationandnewproductinnovationsareexpectedtodrivethesalesofdenture
productsovertheforecastperiod.
The U.S. population continues to age, with approximately 43million persons aged 65
andolderasof2012.
Estimates show that the aged population is expected to almost double, to
approximately90millionby2050.
Irrespective of the limited new product activity, line extensions and reformulations
continuetobeintroduced,retainingconsumersinterestinthecategory.
With growth in the dental accessories category, cleansing brands may also see
moderategrowthifthemarketerscanpositioncleansingproductsforuseinthisarea.
Limited privatelabel activity in the category is expected to help the growth of branded
productsinthecategoryovertheforecastperiod.
Privatelabel products have not been able to establish a significant foothold in the
category and, therefore, do not exert significant downward pressure on dollar sales.
Thistrendisexpectedtocontinue.
Wideruseofpermanentimplantsandimprovementinoralcareismostlikelytolimit
thecategoryssalesduringthenextfiveyears.
Toavoidthehassleslinkedwithdentures,consumersareoptingfordentalimplants.
Expandedprofessionalservices,suchasrootcanals,havebecomeincreasinglypopular
amongconsumersastheseserviceshelppreserveoralhealth.
Advancements in dentistry, along with improved oral hygiene, will help people
preservetheirnaturalteeth.
Newtoothpastes,toothbrushes,andotherproductshelpconsumerstakebettercareof
theirteethathome.
The above factors will affect the demand for denture products and as a result prices
areexpectedtoslowlydecline.
4A18
DentureProducts
SalesofdentureproductsareforecasttogrowataCAGRof0.3%from$318millionin2012
to$322millionin2017.
Unit volume is expected to grow at a CAGR of 0.2%, from 88million packages in 2012 to
approximately89millionpackagesin2017.
4F19
4F20
DentureProducts
4A20
LIPBALMS,JELLIES,ANDTREATMENTS
CATEGORYPERFORMANCE
Manufacturerssales
Salesoflipbalms,jellies,andtreatmentsatthemanufacturerslevelincreaseby4.8%from
Since2007,manufacturerssalesoflipbalms,jellies,andtreatmentshaveincreasedat
acompoundannualgrowthrate(CAGR)of2.1%peryear.
Table4F13:HistoricalSalesofLipBalms,Jellies,and
TreatmentsintheUnitedStates,2007to2012
Year
$Million
Change,%
2007
337
2008
351
4.2
2009
342
(2.6)
2010
347
1.5
2011
357
2.9
2012
374
4.8
Unitsales
Unitsalesoflipbalms,jellies,andtreatmentsincreasefrom159millionpackagesin2011to
165millionpackagesin2012,up3.8%.
Retailsales
Retailsalesoflipbalms,jellies,andtreatmentsareup5.8%,totaling$482millionin2012
4F22
LipBalms,Jellies,andTreatments
Table4F14:ManufacturersSalesofLipBalms,Jellies,andTreatmentsintheUnitedStatesbyBrand,
2011and2012
$Million
Brand
Company
Chapstick
%Oftotal
2011
2012
2011
2012
Pfizer
82
79
23.0
21.1
BurtsBees
TheCloroxCompany
53
58
14.8
15.5
Blistex
Blistex
52
49
14.6
13.1
Carmex
CarmaLaboratories
31
31
8.7
8.3
EOS
EOSProducts
19
2.5
5.1
MaryKay
MaryKay
17
17
4.8
4.5
Nivea
Beiersdorf
14
16
3.9
4.3
Bath&BodyWorks
LimitedBrands
14
15
3.9
4.0
LipFusion
FusionBeauty
14
12
3.9
3.2
Mentholatum
RothoPharmaceutical
10
10
2.8
2.7
Neosporin
Johnson&Johnson
2.2
1.6
Aveeno
Johnson&Johnson
1.7
1.6
VaselineLipTherapy
Unilever
1.7
1.6
Neutrogena
Johnson&Johnson
1.1
1.6
Clinique
EsteLauder
1.4
1.3
Avon
Avon
1.4
1.1
Lancme
L'Oral
0.6
0.5
MAC
EsteLauder
0.6
0.5
EsteLauder
EsteLauder
0.3
0.3
Privatelabel
11
2.5
2.9
Allother
13
19
3.6
5.1
357
374
100.0
100.0
Total
CATEGORYDEVELOPMENT
Markettrends
Salesincreaseaslipcareproductsaredevelopedasanauxiliarytothesuncareregime.
Sales for the category increase because consumers purchase newinnovative lip balm
productsthatprovidemultiplebenefits,suchasantioxidantsandsunprotection.
Lip balms that provide protection against sun, tinted lip balms, and lip balms which
provide other treatment benefits perform well. Marketers such as Margaritaville and
Rohto Pharmaceuticals introduce lip balms with sun protection benefits for their
respectivebrandsin2012.
MarketerssuchasEOSProducts,TheCloroxCompany,andBeiersdorfofferlipbalms
thatcarrySPFratings,claimUVprotection,andfeatureantioxidantactivityin2012.
4A22
In2012,severalmarketersintroducenewproductsinthecategory,thatstimulatesales.
BurtsBees(Clorox),Blistex(Blistex),andNivea(Beiersdorf)productlinesexpandwith
theintroductionofnewvariantsin2012.BeiersdorflaunchesNiveaLipButtersinfour
flavors,Blistexenhancesitslipbalmportfoliowiththeadditionoftwonewproducts
MoistureMeltandSimpleandSensitivewhilethreenewshadesareaddedtoBurts
BeesLipShimmercollection.
EOS Products lip balms, especially Smooth Sphere, are gaining popularity among
women consumers. In 2012, the company launches a limited edition Alice in
Wonderlandcollectionwhichincludesathreepackcollection.
People increasingly buy products that comprises natural or organic ingredients. For
example, Burts Bees expands its lip balm product portfolio with the introduction of
UltraMoisturizingLipTreatmentwithKokumButter,whichdoesnotincludeparabens
phthalatesorpetrochemicals.
Sales of lip care products are expected to increase in winter, when consumers need to
protecttheirlipsfromharshconditionsandtorepairthechappingthatcanresultfromthe
weather,andfromcoldandflu.
This categorys products do not have an identifiable shelf space with retailers. They are
mostlyexhibitedinthecough/coldsectionsoratthefrontend/registers.
Most lip care products continue to be displayed in the cough/cold sections or at the
frontend/registers.
In some instances, dueto the brands popularity, the lip balm products are placed in
othersections.Niveaslipproductsarealsosoldwithinthehandandbodysectionsand
Burts Bees lip balms are offered alongside the companys other products in the
personalcareaisle.
Lipsticksandlipglossescompetewiththecategorysproductsataminorlevel.
Aminorsectionofsalesforthelipbalmproductsisoffsetbytheincreasingpresenceof
moisturizingingredientsinthelipsticksandlipglossesformulations.
Lipsticksandlipglossesenhancetheappearanceoflips,whilelipbalmismoreoften
usedasanalterativeproduct.
However,mostwomencontinuetousebothlipbalmsandtintedproductsfordifferent
purposes.
4F23
4F24
Notablenewproducts
Table4F15:SelectNewLipBalms,Jellies,andTreatmentsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Beiersdorf
Nivea
BeiersdorfintroducesNiveaLipbutterbalmsinjarformatsthatis
availableinfourdifferentflavors:RaspberryRoseKiss,Caramel
CreamKiss,VanillaandMacadamiaKiss,andSmoothKiss
Blistex
Blistex
Blistexenhancesitslipbalmcategoryportfoliowithtwonew
products:MoistureMeltthatprovidesmoisturizationandlong
lastingresistancetodrynessandSimpleandSensitivewithno
addeddyesorfragrances
BodyDrench
LipDrench
Infusedwithbeeswaxcomplexandisavailableinsixflavors,
relieveschappedlipsandprotectsitfromfreeradicals
CarmaLaboratories
Carmex
OrangeflavoredCarmexcreamylipconditioner,infusedwith13
moisturizersincludingcocoabutter.Anothervariant;Carmex
ultramoisturizinglipbalminpomegranateflavor
BurtsBees
BurtsBeesintroducesUltraMoisturizingLipTreatmentwith
KokumButter,whichhelpssootheandrestorelips.Thebrand
addsthreenewshadestoitsLipShimmercollection:cherry,
plum,andstrawberry
EOSProducts
EOS
EOSlauncheslimitededitioncollectioninthreeflavors:
WatermelonWonderland,SweetVanillaNonsense,and
BlueberryPotion.ItalsoinstallsPomegranateRaspberrySmooth
SphereLipBalmasapermanentflavor
Margaritaville
ParrotHead
FloridaysMoisturizingLipBalmwithSPF50.Thealoehydrating
complex500formulaisenrichedwithjojoba,avocado,cocoa
butter,andvitaminEtosootheandnourishlips
Rohto
Pharmaceuticals
Softlips
FournewvariantsSoftlipsJackFrostinglipbalm,Softlips
peppermintsticklipbalm,SoftlipsMarshmallowGhost,and
SoftlipsGlossprovidesunprotection
TheCloroxCompany
Salesbyproducttype
The stick form of lip balms, jellies, and treatments continues to dominate the majority of
thecategoryssalesin2012.
In 2012, sales of products in sticks grow with the introduction of several new Burts
BeesandEOSproducts.
Niveaintroducesnewlipbutterswhichareavailableinjarformatsin2012.
4A24
Table4F16:ManufacturersSalesofLipBalms,Jellies,andTreatmentsintheUnitedStatesby
ProductType,2011and2012
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Change,%
Sticks
242
251
67.8
67.1
3.7
Tubes
73
73
20.4
19.5
Jars
36
37
10.1
9.9
2.8
13
1.7
3.5
116.7
357
374
100.0
100.0
4.8
Allothera
Total
aIncludesspheres.
COMPETITION
Bybrand
Chapstick(Pfizer)persistsastheleadingbrandinthecategoryin2012.
The brands sales slide 3.7% to $79 million in 2012 from $82 million in 2011. Market
share of the brand declines as consumers increasingly buy natural products. The
company has not introduced any new lip balm products in 2011 and 2012. Pfizers
latest product launch in the category was in 2010, when the marketer introduced its
UltraSmoothlineinfourflavors.
Itconstitutes21.1%ofthetotalmarketin2012,downfromitspreviousyearsshareof
23.0%.
In2012,themarketershiftsitsadvertisementspendingfromtelevisiontomagazines;
andcontinuestousetheradioandtheInternetdisplaysasaddedmedia.
Pfizeristhethirdleadingadvertiserinthecategory,withaTMEof$5millionin2012.
BurtsBees(TheCloroxCompany)remainsaheadofBlistexandisthesecondlargestbrand
in2012.
Manufacturers sales increase 9.4% to $58 million in 2012 from $53 million in 2011.
Burts Bees products benefit as demand shifts from syntheticbased and petroleum
basedlipproductstothoseproductswhicharemorenatural.
Market share rises to 15.5% in 2012 from 14.8% in 2011. The Clorox Company
apportions$2.6millionintraceablemediaexpenditure(TME)in2012,ofwhich99.1%
isspentonmagazineadvertising.
Thebrandpromotesviaprintadvertisementsandsocialmedianetwork.In2012,the
companyinitiatesBurtsBeeslipbalmnaturalchampioncontest,inwhichpeopleenter
the contest by posting a photo of themselves with the brands lip balm. The winner
receives a three day trip including airfare, hotel, and ground transportation to Burts
BeesHeadquartersinDurham,privateconcerttickets,four$150.00spavouchers,and
$500.00ofBurtsBeesproducts.
4F25
4F26
BurtsBeesFacebookfanbasetouches1millionin2012,upsignificantlyfrom560,000
in2011.
The company increased its distribution channels through specialty natural retailers,
massretailers,anddepartmentstoresin2011,whichcontinuestoaidinincreasingthe
brandssalesin2012.
In2012,Blistex(Blistex)isthethirdleadingbrandinthecategory,regardlessofadeclinein
itssalesby5.8%to$49millionin2012from$52millionin2011.
The brands market share has dropped to 13.1% in 2012 from 14.6% in 2011. Share
gains by other brands, such as EOS, Burts Bees, and Nivea, cut down the brands
marketposition.
The marketer attempts to catch up with its rivals by introducing more products that
containnaturalingredients.
Thebrandlaunchestwonewproductsin2012:MoistureMeltandSimpleandSensitive.
Moisture Melt is a hydrating lip balm with shea butter softbeads in a base of aloe
Vera;andSimpleandSensitive,ahypoallergenicformulawithcocoabutter,jojobaoil,
andsunflowerseedoilthatmoisturizessensitivelipswithoutcausinganyirritation.
Blistexformatsincludesticks,tubes,andjars.
BlistexistheleadingadvertiserinthecategorywithaTMEof$9.4millionin2012,up
from$3.7millionin2011.Themarketerapportions$5.0millionor52.6%ofthetotal
TMEtoprintmediaand$4.0millionor42.5%oftotalTMEtothetelevisionadvertisting.
Carmex (Carma Laboratories) is the fourthlargest brand in the category with its market
shareat8.3%in2012,downfrom8.7%in2011.
Thebrandssalesfor2012areestimatedat$31million,thesameasits2011levels.
In spite of being one of the leading players in the lip care segment, Carmex has an
insignificantamountallocatedasmediaexpenditures.Thislimitsthegrowthprospect
forthebrand.
ThebrandintroducesorangeflavoredCarmexcreamylipconditionerandpomegranate
flavoredCarmexultramoisturizinglipbalmin2012.
Carmexlipbalmsareavailableintube,jar,andstickformats.
NewcomerEOSProductsjumpstofifthpositioninthelipbalmcategory,withsalesforEOS
lipbalmsgrowing111.1%in2012,to$19millionfrom$9millionin2011.
Sales for the EOS smooth sphere lip balm continue to increase with its agressive
marketingtacticsdesignedin2011.
The brand creates awareness by advertising in magazines, such as Marie Claire, OK!,
andCosmopolitanandbymaximizingtheproductsvisualimpactonshelf.
Innovativeproductformsandpackaging,whichisthemaindifferentiatingstrategyof
themarketer,resultsinsalesincrease.
EOSlipbalmproductscommandamarketshareof5.1%in2012,upfrom2.5%in2011.
The lip care products are made of natural and organic ingredients, which are
increasinglyindemand.
4A26
The marketer apportions TME of $8.5 million and has the second largest spending of
mediaexpenditurein2012.Printmedia,socialnetworks,andsamplingarethefavored
modesofpromotingitsproducts.
In2012,BeiersdorfedgesoutBath&BodyWorks,anditsNiveassalesareestimatedat
seventhposition,justafterMaryKay.Thebrandssalesriseto$16millionin2012from
$14millionin2011,anincreaseof14.3%.
Niveaslowerpricingoflipcareproductsanditsbrandimageboostitsgrowth.
Niveasmarketshareinthecategoryincreasesfrom3.9%in2011to4.3%in2012.
Thebrandoccupiesthefourthpositioninthecategoryintermsofmediaexpenditure,
with the most popular medium being print advertisements. The marketer spends
$4.1milliontopromoteitsNiveabrandinmagazines.
RETAILDISTRIBUTION
Mass merchandisers and drug stores remain the key distribution channels for lip balms,
jellies,andtreatmentsin2012.
Table4F17:ManufacturersSalesofLipBalms,Jellies,and
TreatmentsintheUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
Massmerchandisers
32
33
Drugstores
27
27
Foodstores
20
20
Specialtystores
11
11
Directsales
Departmentstores
100
100
Total
2012
4F27
4F28
MARKETINGACTIVITY
Promotionoflipbalmscontinuestoremainstrongin2012.
Print advertisements represent the most important channel of advertising for this
category, followed by television. Marketers spend $26.8 million or 81.2% of the total
TMEinprintmediaand$4.0millionor12.1%oftotalTMEintelevisionadvertising.
Specialvaluepacksandofferscontinuetobeutilizedaspopularmarketingstrategies.
In2012,BlistexandCarmexoffercouponsworth$0.65and$0.30,respectively.In2012,
Beiersdorfreports1millionfansonitsFacebookandextendscoupons,afterwatchinga
shortNiveavideo,forafreeNivealipbalm.
Mostmarketerspromotetheirbrandsonsocialmedia,suchasFacebook,Twitter,and
YouTube, since this media has a wider reach and is more personal in nature. New
product launches, latest discounts and offers, and other events are advertised in this
media.
TotalTMEforthelipbalms,jellies,andtreatmentscategoryincreasetonearly$33millionin
BlistexincreasesitsTMEallocationby46.9%in2012,to$9.4millionfrom$6.4million
in2011.
EOS Products allocates about $8.4million in advertisement spending, up 75.0% from
$4.8millionin2011.
Pfizer,thecategoryleaderwithitstopbrandChapstick,spends$5.0millionin2012,up
TheCloroxCompanyspends$2.6milliontoadvertiseitsBurtsBeesbrandcompeting
inthelipbalmcategory.Themarketerallocates99.7%ofitstotalTMEtosupportitsLip
Shimmercollection.
Carmex, in spite of being one of the major brands in the category, invests only
$1.2millioninTMEduring2012,downfrom$1.7millionin2011.
Blistexisthelargestspenderonadvertisinginthiscategoryin2012.
Thecompanyallocates52.6%ofthetotalTMEor$5.0milliontotheprintmedia.Romance
isthekeycomponentofadvertisinginmagazines,thatfeatureslogans,suchasLipService
isagoodthingandBecausefourstarProtectionisn'tenoughforfivestarmoments.
Thesecondmostpopularmediumofadvertisementistelevision.TaglinessuchasDiscover
Bliss.DiscoverBlistex.areemployedtoinduceconsumerinterest.Blistexspends42.5%of
totalTMEor$4.0milliontopromoteitslipbalmproductsinthismedium.
BlistexwebsitehasasectioncalledLipTipswhicheducatesconsumersaboutcommonlip
problems,offerstipsonlipcare,andfeatureslipquizzes.
EOSProductsisthesecondlargestmediaspenderonadvertisinginthecategoryin2012.
The company spends $8.4 million or 99.1% of its TME on magazine advetisements. In
magazineadvertisements,theproductsaremadetoresembleobjectsineverydaylife,such
asabasketofapples,eggsinnests,andberriesinblenders.
The marketer actively promotes its brand on social networking sites. EOS Facebook page
allows consumers to learn of new product introductions, the latest deals and offers
availableatvariousstores,andotherevents.
4A28
Pfizer, the thirdlargest spender on advertising in this category in 2012, increases its
advertisingexpendituresfromthepreviousyear.Themarketerspends$5.0millioninTME
in2012,up13.6%from$4.4millionspentin2011.
In 2012, Pfizer focuses its advertising spend primarily on magazines (76.1%), radio
(11.7%),andpointofpurchasedisplays(11.2%).
Beiersdorf spends $4.1 million to promote its Aquaphor and Nivea lip care brands. The
marketeradvertisesitslipcarebrandbyhostingconteststhroughthesocialmedia.
In 2012, Beiersdorf promotes its Nivea lip brand through its Kiss of the Year contest,
where fans can share their love story on Facebook and win an opportunity to
participateintheNewYearsEvekissonNiveaKissStageinTimesSquare.Thecouple
with the most public votes wins an all expenses paid trip to New York City to meet
NiveaambassadorsMarioLopezandCourtneyMazza,twoVIPticketstotheNewYears
Eve party at Hard Rock Caf, and a feature in the U.S. Weekly magazine which
highlightstheirnewyearskiss.
Details on TME by brand are included in the Advertising section of this report and in the
database.
OUTLOOK
Thelipbalms,jellies,andtreatmentscategoryisforecasttogrowataCAGRof1.9%inthe
fiveyearforecastperiod,2012to2017.
Brandawarenessislikelytoincreaseascompaniesraisetheirpromotionalbudget.
As the presence of lip care products increase across distribution channels, especially
massmerchandisers,thecategoryssalesarelikelytoincrease.
Salesofhighpricedlipbalmswithadditionalbenefits,suchasantiagingarelikelyto
increaseandsupportthecategorysgrowth.
Inthelipbalm,jellies,andtreatmentscategory,thetopsixmarketersholdacombined
marketshareofalmost68.0%in2012.Duetobroadpromotionalmeasurestakenby
thesecompanies,privatelabelproductswillnotbemajorcompetitorsinthelipbalm
productscategory.
Marketers are likely to adopt new strategies, such as package innovations and trial
sizestoattractnewcustomers.
Newproductinnovationswithincreasedfeatureswillinduceconsumerinterest.
Thereisanincreasingdemandforlipproductsthatprovidelipplumping,antioxidant,
andsunprotectionbenefitsapartfromsolelymoisturizingthelips.
Tinted lip balms are likely to witness sales increase as they compete directly against
lipsticksandlipglosses.
Risingconsumerawarenessaboutthebenefitsofnaturalandorganicproductswillhelp
increasethesalesofsuchproducts.
Manufacturersstrivetowardsteenagersremainingloyaltotheirbrandandcontinuing
theuseoftheirlipcareproducts,sincelipcareproductsaremostlyusedbyteenagers
toagreatextent.
4F29
4F30
However,somefactorsrestraingrowthofthelipbalmcategory.
Warmerclimateintheregioncouldimpactthesales.Demandforlipbalms,jellies,and
treatmentproductsaregreaterduringthecoldclimatethanatothertimesoftheyear.
As stronger and brighter lip colors become popular, women will increasingly select
lipsticksovertintedlipbalms.
Sales are forecast to grow at a CAGR of 1.9% to reach $410 million in 2017, up from
$374millionin2012.
Unit sales of the lip balm category are expected to increase at a CAGR of 1.2% from
165millionpackagesin2012to$175millionpackagesin2017.
Unit sales grow slower than dollar sales as the premiumpriced products are
increasinglybecomingpopular.
4A30
MOUTHWASHES
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesofmouthwashesincrease2.2%in2012astheeconomycontinuesto
recoverandnewproductformulationsoffermultipurposeproductstomeetmanyneeds.
Since 2007, sales of mouthwashes increase at a compound annual growth rate (CAGR) of
1.7%peryeartoreach$799millionin2012.
Table4F18:HistoricalSalesofMouthwashesintheUnitedStates,
2007to2012
Year
$Million
Change,%
2007
735
2008
779
6.0
2009
761
(2.3)
2010
759
(0.3)
2011
782
3.0
2012
799
2.2
Unitsales
Unitsalesofmouthwashesgrow2.0%in2012to192.0millionpackagesfrom188.5million
packagesin2011.
Retailsales
Retailsalesofmouthwashestotal$1,035.4millionin2012,up2.6%from$1,009.2millionin
2011.
4F32
Mouthwashes
Table4F19:ManufacturersSalesofMouthwashesintheUnitedStatesbyBrand,2011and2012
$Million
Brand
Company
2011
2012
Listerine
Johnson&Johnson
336
340
Crest
Procter&Gamble
105
Scope
Procter&Gamble
Act
%Oftotal
2011
2012
43.0
42.6
110
13.4
13.8
75
76
9.6
9.5
Sanofi
63
66
8.1
8.3
Biotene
GlaxoSmithKline
19
21
2.4
2.6
TomsofMaine
ColgatePalmolive
12
12
1.5
1.5
Plax
Johnson&Johnson
10
10
1.3
1.3
TheraBreath
CaliforniaBreathClinic
0.8
0.8
Lavoris
CharlesFloraConsumerProducts
0.3
0.3
Cepacol
ReckittBenckiser
0.3
0.3
Listermint
Johnson&Johnson
0.3
0.3
Rembrandt
Johnson&Johnson
0.3
0.3
OralB
Procter&Gamble
0.1
0.1
Targona
GlaxoSmithKline
0.3
Viadenta
ColgatePalmolive
0.3
Fluorigarda
ColgatePalmolive
0.1
Privatelabel
129
135
16.5
16.9
Allother
13
14
1.7
1.8
782
799
100.0
100.0
Total
aDiscontinued.
CATEGORYDEVELOPMENT
Markettrends
Themultibenefitmouthwashessupportthecategorysgrowthin2012.
Mouthwashesthatoffermultiplebenefits,suchasteethstrengthening,helpingrebuild
enamel,andpreventingcavitiessupportthegrowthofthecategoryin2012.ActTotal
Care is one of those products which gained from providing multibenefits including
teethstrengtheningandbreathfreshening.
Products that provide added benefits are important to consumers as these products
drivegrowthintheoralcareproductclass.
Among the multibenefit products, whitening mouthwashes see good growth as
consumersareincreasinglyturningtowhiteningoralcareproducts.
The sales of mouthwashes are also supported by consumers turning to easy, instant
solutionsforpreventingbadbreathandkillinggerms.
4A32
Mouthwashes
Listerine(Johnson&Johnson),thelargestbrandinthecategory,seesbetterresultsfromits
variant Listerine Zero, which is alcoholfree and provides protection against bad breath,
therebykillinggerms.
SecondleadingbrandCrest(Procter&Gamble)seesgrowthof4.8%in2012,andleads
the field by focusing on the tween segment. Crest continues to invest in its Crest
ProHealthCompleteproductsduringtheyear.ProHealthisthefirstevercollectionfor
kids aged 8 to 12 years, with flavors and packaging designed just for them. This line
includestheAnticavityFluorideRinse.
AlthoughtheCrestProHealthvariantreceivesalotofcomplaintsthatitturnstheteeth
yellow, the brand still benefits from the launch of Crest 3D White mouthwash range
whichfeatureswhiteningasitsmainbenefit.
Thecategorysgrowthisalsosupportedbysmallbrandsthatcontinuetopostlowgrowth.
Act(Sanofi)whichfeaturesanalcoholfreeformulahasan8.3%share.
TomsofMaine(ColgatePalmolive)isanaturallypositionedproductwitha1.5%share.
TheraBreath(CaliforniaBreathClinic),whichspecificallyaddresseshalitosis,hasa0.8%
marketshare.
Rembrandt(Johnson&Johnson)isawhiteningproductwith0.3%share.
Notablenewproducts
Table4F20:SelectNewMouthwashesIntroducedintheUnitedStatesin2012
Company
Brand
Description
ColgatePalmolive
Colgate
OpticWhiteportfoliohasexpandedwithnewRefreshingMintmouthwash
andAnticavitySparklingMinttoothpaste,claimstoeffectivelywhiten
teethandprotectagainstfuturestains
Johnson&Johnson
Listerine
TotalCareZeroinFreshMintvariant,preventscavities,restoresenamel,
strengthensteeth,preventsbadbreath,andcleansthewholemouth
Johnson&Johnson
Listerine
Ultracleanmouthwashcontainsantitartaringredientforcleaner,brighter
teeth,clinicallyproventoremoveplaqueandkillgerms.Itisavailablein
twovariants:ArcticFreshandFreshCitrus
Procter&Gamble
Crest
Crest3DWhiteArcticFreshIcyCoolMintOralRinseisinfusedwithatriple
actionformulathatwhitensteethbyremovingsurfacestains,helpsprotect
againsttheformationofnewstains,andfreshensbreath
Procter&Gamble
Crest
CrestProHealthClinicalAntiplaquerinse,offersprotectionfromplaque
andgingivitis,clinicallyproventoreduceplaqueandhelppreventplaque
regrowth,andclinicallyproventohelppreventandreversegingivitis
Procter&Gamble
Scope
Outlastmouthwashinfusedwithoutlasttechnologythatbindstightlyto
selectreceptorsinthemouth,creatingacool,refreshingsensationthat
lastslonger
Sanofi
Act
TotalCareinfusedwithnaturalbotanicalsthataregentleonsoremouths,
alcoholfree,andstrengthenstheteeth.Itisavailableintwovariants:Mild
MintandTropicalBreeze
4F33
4F34
Mouthwashes
COMPETITION
Bycompany
Table4F21:ManufacturersSalesofMouthwashesintheUnitedStatesbyCompany,2011and2012
$Million
%Oftotal
Company
2011
2012
2011
2012
Change,%
Johnson&Johnson
350
354
44.8
44.3
1.1
Procter&Gamble
181
187
23.1
23.4
3.3
Sanofi
63
66
8.1
8.3
4.8
GlaxoSmithKline
21
21
2.7
2.6
ColgatePalmolive
15
12
1.9
1.5
(20.0)
Allother
152
159
21.4
21.4
2.4
Total
782
799
100.0
100.0
2.2
Johnson&Johnsonremainstheleadingmarketerinthecategoryin2012,withtotalsalesof
$354 million, up 1.1% from $350 million in 2011. In 2012, the market share decreases to
44.3%,downfrom44.8%in2011.
Listerineisthecompanyslargestmouthwashbrandandisalsothepreeminentleader
inthiscategory.
Listerines sales grow 1.2% from $336 million to $340 million in 2012. Growth of the
Listerine brand is supported by the strong performance of its alcoholfree variants:
ListerineZeroandTotalCare.
The company continues to stress on the importance of using Listerine twice a day in
ordertohave24hourprotection.
IncreasedmarketingandnewproductactivitysupportthesalesoftheListerinebrand
in2012.
SalesofPlaxremainat$10millioneachin2011and2012duetoalackofpromotional
supportandexcitementforthebrand.
Sales of Listermint and Rembrandt remain low at a rounded $2 million each in 2012,
sameas2011levels.
4A34
Mouthwashes
Procter&Gambleisthesecondlargestmarketerinthiscategorywith23.4%share,upfrom
23.1%in2011.
Crest,thesecondlargestbrandinthecategory,experiencesasalesincreaseof4.8%in
2012withtheintroductionoftwonewproducts:CrestProHealthClinicalAntiPlaque
RinseandScopeOutlastmouthwash.
Crestsmarketshareincreasesfrom13.4%in2011to13.8%in2012.
The new Crest 3D Whitening range includes Arctic Fresh Rinse and Glamorous White
Rinse that help boost brand sales. Also, the cross marketing with the OralB
toothbrusheshelpsbroadenawarenessanddemandforthebrand.
Scope rises 1.3% in 2012, benefiting from new branding and packaging in 2012, with
salesreaching$76millionin2012from$75millionin2011.
ScopeOutlastmouthwash,introducedin2012,booststhebrandssaleswithitsstrong
performance.
Sanofiisthethirdleadingmarketerwith8.3%marketshare,upfrom8.1%in2011.
Salesincrease4.8%from$63millionin2011to$66millionin2012.
ThesalesgrowthforSanofiissupportedbyitsnewlaunchActtotalcare.
Productsformulatedforchildrenarebecomingincreasinglypopularwithparentsasa
meanstoboth,ensurehigherproductsafetyforchildrenandencouragechildrentouse
theproduct.ActsAnticavityKidsrinseforchildrenispopularamongconsumers.
Privatelabel
Themarketshareforprivatelabelproductsincreasesto16.9%in2012,upfrom16.5%in
2011.
Salesgrow4.7%to$135millionin2012,from$129millionin2011.
Privatelabel products have the secondlargest share of the market after Johnson &
JohnsonsListerine.
Improvedformulations,lowerpricepoints,multiplebenefits,andimprovedpackaging
contributetothesalesofprivatelabels.
RETAILDISTRIBUTION
In2012,theshareofretaildistributionofmassmerchandisers,foodstores,anddrugstores
remainsflatwith2011levels.
4F35
4F36
Mouthwashes
Table4F22:ManufacturersSalesofMouthwashesintheUnitedStates
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
46
46
Foodstores
29
29
Drugstores
25
25
100
100
Total
MARKETINGACTIVITY
In 2012, promotional activity for mouthwashes focuses heavily on television commercials

andmediaadvertisinginmagazines,withlimitedfocusonInternetdisplayadvertisements.
Johnson & Johnson is the leading advertiser with traceable media expenditures (TME) of
$55.9millionin2012,downby21.6%from$71.3millionin2011.
About threefourths of the companys advertising spend is allocated to television
commercials,withmostoftheremainingquarterspentonmagazineadvertisements.
All of the companys advertising support is allocated to the Listerine brand, with no
spendingonminorbrandsListermint,Plax,andRembrandt.
The company offers discounts coupons ranging from $1.00 to $2.00 on Listerines
websitetopromotethesalesofitsproducts.
The Listerine brands website also provides tips for maintaining a clean and healthy
mouth.
Procter&Gambleisthesecondlargestadvertiserformouthwashes,spending$22.0million
in2012.
TMEaredividedprimarilybetweentwobrandsCrestProHealthandScopebothof
whichhavenewproductlaunchesin2012.
Procter & Gamble allocates approximately $17.2 million to promote its Crest Pro
Healthbrand,andtheremaining$4.8millionisallocatedtotheScopebrand.
Advertising spend is primarily allocated to magazines and television commercials in
2012.Thecompanyallocates$18.0millionofitsTMEonmagazineadvertisementsand
$1.3millionontelevisionadvertising.
SanofiranksaclosethirdinTME,spending$23.6millionin2012.
Almostallofthecompanysadvertisingspendisallocatedtotelevisioncommercials.
About threefourths of advertising expenditures go to support Act Total Care Dry
Mouthformula,withaboutonefourthcollectivelygoingtoActAnticavityKidsFluoride
RinseandActRestoringMouthwash.
4A36
Mouthwashes
4F37
Advertising increasingly differentiates products based on the ability to deliver added

benefits.
DetailsonTMEbybrandareincludedintheAdvertisingsectionofthisreport.
OUTLOOK
The mouthwashes category is mature and, over the next five years, will experience
relativelylowsalesgrowth.
This category will continue to face stiff competition from toothpastes with allinone
benefits.
Toothpastes are increasingly incorporating mouthwash properties in product
formulationstherebygivingintensecompetitiontothecategory.
Mouthwashesthatoffermultibenefitsareexpectedtosupportthecategorysgrowthover
theforecastperiod.
Mouthwashesthatoffermultiplebenefits,suchasteethwhitening,protectionagainst
bad breath, and enamel protection are expected to see good sales growth over the
forecastperiod,2012to2017.
Multibenefit mouthwashes are more attractive to consumers as they are more
convenientandaffordablethanthealternativeofhavingtopurchasemultipleproduct
types.
However,themouthwashescategoryisnotconsideredasanecessity,ascomparedto
toothpastesandtoothbrushes.Whenfacedwithbudgetaryconstraints,consumerswill
morereadilyspendontoothpastes.
Productsthatarepositionedtoprovidebetterresults,suchaskillinggerms,areexpectedto
seegrowthovertheforecastperiod.
Increasingawarenessamongconsumersregardingoralhygienewillalsoboostthesales
ofmultibenefitmouthwashes.
However, if marketers do not support their brands with adequate TME, then further
growthofthecategoryislikelytoberestricted.
Newproductinnovationswithbetterformulaswillcatertothegrowthofmouthwashesin
theforecastperiod.
Better promotional and advertisements support for the mouthwashes category will
supportthesalesgrowthofthecategory.
Companywebsiteswillcontinuetopromoteproductsinexcitingmultimediaformatsto
enticeteensandyoungerconsumers.
MarketersareexpectedtousetheInternetandsocialmediaonalargerscaletoreach
youngerandmoretechnologicallysavvyconsumersinthefuture.
4F38
Mouthwashes
There are certain problems related to aging that result from increased medication that
include dry mouth and bad breath; these factors present opportunities for new product
innovationandbrandpromotion.
Toothpastesareincreasinglyincorporatingmouthwashesinproductformulations.
Dry mouth will continue to plague consumers, as a result of aging and higher use of
medicationwithadversesideeffects.
Marketers have been unable to convert a large numbers of consumers who do not
currentlyusemouthwashproductsintoregularusers,whichhaslimitedthecategorys
growth.
Furthermore,theyoungersegmentsofthepopulation,suchaschildren,representagrowth
opportunity,andsomebrands,suchasAct(Sanofi)arepursuingthissegmentaggressively.
Agespecific oral care sales will continue to experience strong growth, as marketers
refreshtheirbrandswithnewofferingsbasedonspecificneeds
Marketers, such as Procter & Gamble and Sanofi are expected to launch products
specific to tweens (aged 8 to 12), such as Crest ProHealth For Me Anticavity
mouthwash,whichwillsupportsalesovertheforecastperiod.
Privatelabelproductswithcontinuousimprovementsinqualityandpricingareexpectedto
postsalesgrowthinthecategoryovertheforecastedperiod.
Retailersarealsoexpectedtoallocatemoreshelfspacetosupportthesalesofprivate
Increasingsalesoflowerpricedprivatelabelproductswillweakendollarsales.
Therecoveringeconomywillexertbothpositiveandnegativeeffectsonprivatelabel
products.
Companies will continue to leverage their total oral hygiene portfolio of crosscategory
productstobothretailersandconsumerswithcoordinatedlaunchesandpromotions.
Manufacturers sales of mouthwashes are forecast to grow at a CAGR of 1.4% to reach

approximately$856millionin2017,upfrom$799millionin2012.
UnitsalesareforecasttoincreaseataCAGRof1.1%from192.0millionpackagesin2012to
about203.0millionpackagesin2017.
4A38
TOOTHBRUSHES
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesoftoothbrushesgrow2.2%in2012to$741millionfrom$725million
in2011.
Since2007,salesoftoothbrusheshaveincreasedatacompoundannualgrowthrate(CAGR)
of0.4%peryear.
Table4F23:HistoricalSalesofToothbrushesinthe
Year
$Million
Change,%
2007
726
2008
730
0.6
2009
725
(0.7)
2010
718
(1.0)
2011
725
1.0
2012
741
2.2
Unitsales
In2012,unitsalesoftoothbrushesgrow1.5%to349millionpackagesfrom344millionin
2011.
Retailsales
Retail sales of toothbrushes total $907.4million in 2012, up 2.2% from $888.2million in

2011.
4F40
Toothbrushes
Table4F24:ManufacturersSalesofToothbrushesintheUnitedStatesbyBrand,2011and2012
$Million
%Oftotal
Brand
Company
2011
2012
2011
2012
OralB
Procter&Gamble
215
204
29.7
27.5
Colgate
ColgatePalmolive
139
152
19.2
20.5
Reach
Dr.Fresh
45
49
6.2
6.6
Arm&HammerSpinBrush(Battery)
Church&Dwight
48
45
6.6
6.1
OralB(Battery)
Procter&Gamble
29
29
4.0
3.9
Colgate(Battery)
ColgatePalmolive
27
28
3.7
3.8
ButlerGum
Sunstar
24
26
3.3
3.5
Crest
Procter&Gamble
11
11
1.5
1.5
Aquafresh
GlaxoSmithKline
1.2
1.2
Dr.Fresh
Dr.Fresh
1.0
1.1
Privatelabel
94
101
13.0
13.6
Allother
77
79
10.6
10.7
725
741
100.0
100.0
Total
CATEGORYDEVELOPMENT
Markettrends
The toothbrushes category remains mature, since the product is considered a commodity
withhighhouseholdpenetration.
Toothbrusheswithbetterdesigns,features,andbenefitsdrivethesalesofthecategory
in 2012. For example, Procter & Gamble launches OralB ProHealth Clinical ProFlex
toothbrushthatremovesplaquefromtheteeth.
Improvingeconomicconditionsalsoaidinthesalesgrowthoftoothbrushesin2012.
Consumers are trying new manual toothbrushes with better features and are not
tradingupforinnovativetoothbrushes,astheyarequiteexpensive.Forexample,New
musicaltoothbrushespricedbetween$12.00and$15.00arelaunchedin2012,butare
notdoingwellduetotheirhighprices,suchasBrushBuddiesJustinBiebersinging
toothbrushwhichsellsforabout$15.00.
Premiumpricedproducts,includingsomebatteryoperatedbrushes,seesalesdecline.
Differentoralcareproducttypesbeingofferedasabundledpackagebyleadingmarketers
including Procter & Gamble and ColgatePalmolive support the categorys growth by
keepingconsumersloyaltotheirbrands.
Procter&GambleoffersitsCrestbrandasanoralcarepackagetoconsumers;thispack
includesatoothpaste,toothbrush,andmouthwash.
Similarly, ColgatePalmolive offers its Colgate brand as an oral care package that
containsitstoothbrush,toothpaste,andmouthwash.
4A40
Toothbrushes
Increasingmediasupportwithnewproductinnovationsdrivethesalesoftoothbrushesin
2012,andmostoftheleadingmarketerscontinuetoextendtheirproductlines.
Procter & Gamble extends its new product line for tweens (children aged 8 to 12),
featuringOralBPulsarProHealthForMeVibratingToothbrush.
ColgatePalmolivelaunchestheMaxFreshtoothbrush.
SunstarintroducesStarWarsLineofgumtoothbrushesforchildren.
M&Aactivity
In December 2012, Dr. Fresh completes the acquisition of its Reach brand manual
toothbrushesfromJohnson&Johnsonforanundisclosedprice.
Withtheacquisition,Dr.Freshbecomesthethirdleadingmarketerinthetoothbrushes
category.
TheacquisitiondoesnotincludeReachbrandflossorotherinterdentalproducts.
Notablenewproducts
Table4F25:SelectNewToothbrushesIntroducedintheUnitedStatesin2012
Company
Brand
Description
BrushBuddies
JustinBieber
JustinBiebersingingtoothbrushfeaturestwobuttons,eachof
whichwillplayasongfromthepopstarfortwominutes,sothatit
encourageskidstobrushformoretime
Church&Dwight
Arm&Hammer
ToothTunes
ToothTunesisamanualtoothbrushthatplayspopular
commercialmusicfortwominutestoencourageproperbrushing
ColgatePalmolive
ColgateOpticWhite
ColgateWispOpticWhitetoothbrushcontainsbothwhitening
cupsandpolishingbristles
ColgatePalmolive
ColgateMaxFresh
ColgateMaxFreshtoothbrush,withitsmultiheight,multiangle
bristlespenetratedeeplybetweentheteethtoblastawayplaque
ColgatePalmolive
ColgateMaxWhite
ColgateMaxWhitetoothbrushgentlyremovesstainswithits
uniquepolishingstarandspeciallydesignedbristles
ColgatePalmolive
Colgate
Colgate360ActiflexSonicPowertoothbrushcombinesunique
flexibleactionwiththepowerofsonicvibrationstocleanaround
andinbetweenteeth
ColgatePalmolive
Colgate360Optic
White
Colgate360OpticWhitePowertoothbrushpolishesawaysurface
stainsandcleanshardtoreachplaces
ColgatePalmolive
Colgate
Colgate360WholeMouthCleantoothbrush,withmorebacteria
removingnubs,removesover96%morebacteria
Procter&Gamble
OralB
OralBextendsitslineofProHealthforMelinewithaSensitive
Cleanrechargeablepowertoothbrushthatprovidesagentle
brushingexperiencetokids
Procter&Gamble
OralB
OralBadvantagePlustoothbrush,withouterangledbristlesthat
massages,stimulates,andcleansgumlineeffectivelyforwhiter
teeth
Sunstar
StarWarsLine
MovieinspiredGUMtoothbrushesforchildren
4F41
4F42
Toothbrushes
Salesbysegment
In 2012, sales distribution between the adults and childrens toothbrushes segment
continuetoshifttowardchildrensproducts.
Theadultssegmentcontributesheavilytotoothbrushsalesinthecategory.
Table4F26:ManufacturersSalesofToothbrushesintheUnitedStatesbySegment,2011and
2012
$Million
%Oftotal
Segment
2011
2012
2011
2012
Change,%
Adults
615
626
84.8
84.5
1.8
Children
110
115
15.2
15.5
4.5
Total
725
741
100.0
100.0
2.2
Introductionofnewproductsandbetterpromotionalactivitysupportthesalesgrowthof
childrenstoothbrushesin2012.
Mostoftheleadingmarketers,suchasProcter&GambleandDr.Freshconsiderage
segmentation as a major growth avenue, with childoriented products gaining more
popularity.
Increasingadvertisingandpromotionalsupportalsocatertothegrowthofchildrens
toothbrushes.
Kidsproductsaredevelopedforsmallermouthsandhands,aswellasdevelopingteeth.
Product design, advertising, and packaging are kid friendly, which tends to increase
usage.
Procter&GamblecontinuestosupportitsCrestProHealthproductlinefortweensin
2012.
Dr.FreshintroducesnewFireflyHelloKittytoothbrushesforchildren.
Batterypowered toothbrushes continue to experience growth, supported by the

introductionoflowcostprivatelabelofferingsatTargetandWalmart.Thelowpricepoints
encouragebuyerstoswitchfrommanualtoothbrushestobatteryoperatedones.
Batterypowered products, such as Colgate and OralB continue to receive strong
promotionalsupportfrommanufacturers.
OralBsbatterypoweredtoothbrushsalesremainstablein2012.
Colgates battery toothbrushes sales grow by 3.7%, from $27 million in 2011 to
$28millionin2012.
Arm & Hammers SpinBrush is the most affected by privatelabel introductions, with
salesdecliningin2012.
4A42
Toothbrushes
Manualtoothbrushessalesincreasemarginally,offsetbythedeclineinOralBssalesinthe
category.
Procter&GamblesmanualOralBtoothbrushsalesdeclineby5.1%in2012,duetothe
lackofnewproductintroductionsanddecreaseinmarketingactivity.
ColgatePalmolivesColgatetoothbrushesincreaseby9.4%,duetothesuccessofthe
newlylaunchedColgateOpticWhitein2011,whichcontainsbothwhiteningcupsand
polishingbristles.
COMPETITION
Bycompany
Table4F27:ManufacturersSalesofToothbrushesintheUnitedStatesbyCompany,2011and2012
$Million
Company
2011
2012
Procter&Gamble
255
244
ColgatePalmolive
166
Dr.Fresh
%Oftotal
2011
2012
Change,%
35.2
32.9
(4.3)
180
22.9
24.3
8.4
52
57
7.2
7.7
9.6
Church&Dwight
48
45
6.6
6.1
(6.3)
Sunstar
24
26
3.3
3.5
8.3
1.2
1.2
Allother
171
180
23.6
24.3
5.3
Total
725
741
100.0
100.0
2.2
GlaxoSmithKline
In 2012, Procter& Gamble continues to be the largest marketer in this category,

representingalmostonethirdofthecategorystotalsales.
However,thecompanysmarketsharedropsfrom35.2%in2011to32.9%in2012,as
overallsalesdecreaseby4.3%,from$255millionin2011to$244millionin2012.
ThesalesgrowthisoffsetwiththedeclineinitsleadingbrandOralB.Thebrandssales
declineduetodecreaseinmarketingactivity,suchasdiscountsandcouponsin2012.
Increasing competition from ColgatePalmolive in the toothbrushes category also
hampersthegrowthforProcter&Gamblein2012.
Procter&Gamble,wellknownforitsproductinnovations,investslessinR&Dandnew
productactivityin2012,limitingthemarketerssuccessinthecategory.
4F43
4F44
Toothbrushes
OralB continues to bethe largestbrand in this categorywith a decrease in market share

from33.7%in2011to31.4%in2012.
Thedeclineisdrivenbymanualtoothbrushes,whichdecline5.1%from$215millionin
2011 to $204million in 2012. Battery toothbrushes, a much smaller segment, see
stablesalesat$29millioneachin2011and2012.
Limited new product introductions and marketing activities, such as discounts and
coupons,restrictthegrowthoftheOralBmanualtoothbrushesin2012.
Increaseinpricepointsoffsetsthebrandsgrowthinthecategory.
In2012,ColgatePalmoliveremainsthecategoryssecondlargestmarketer.
Thecompanyssalesincrease8.4%to$180millionin2012from$166millionin2011.
ColgatePalmolivesmarketsharealsoincreasesfrom22.9%in2011to24.3%in2012.
Growth is seen primarily in manual toothbrushes which gain slightly in market share,
from19.2%in2011to20.5%in2012.
Salesofitsbatteryoperatedtoothbrushesalsogrowby3.7%,from$27millionin2011
to$28millionin2012.
The success of Colgates Optic White range of oral care products, which includes
toothbrushes,contributesdirectlytothecompanysgrowth.
Dr. Fresh becomes the thirdlargest marketer in 2012, replacing Church& Dwight in the
category.
Dr.FreshacquirestheReachbrandofmanualtoothbrushesfromJohnson&Johnsonin
2012,therebymakingDr.Freshthethirdleadingmarketerinthecategory.
Dr. Fresh, headquartered in Los Angeles, CA, offers over 250 personal care products
andmarketssomeoftheleadingoralcarebrandsincludingDr.Fresh,Firefly,Binaca,
andDr.Kens.
Thecompanyssalesincrease9.6%,from$52millionin2011to$57millionin2012.
ThecompanysgrowthissupportedbystrongsalesfromitsReachbrand,whichgrows
ThesuccessofReachTotalCareline,launchedin2011,supportsthebrandsgrowthin
2012.
The other smaller brand, Dr. Fresh also sees growth of $1 million in 2012 to reach
Church& Dwight, the thirdleading marketer in the category in 2011, drops to the fourth
positionin2012.
Thecompanysmarketsharedecreasesfrom6.6%in2011to6.1%in2012,withsales
droppingfrom$48millionto$45million.
Arm & Hammers SpinBrush, the largest batterypowered toothbrush brand in the
category,dropsto$45millionin2012from$48millionin2011.Theintroductionofa
privatelabel brand, similar in design and functionality of the SpinBrush, but priced
significantlylower,istheprimarycauseforthedrop.
Church& Dwight discontinues all Mentadent toothbrushes except one, significantly
paringthebrand.
4A44
Toothbrushes
Sunstar becomes the fifthlargest marketer in the category, replacing Johnson& Johnson,
whichsellsitsonlybrand,ReachtoDr.Freshin2012.
GUMistheonlybrandthecompanymarketsinthiscategory.
Manufacturerssalesofthebrandgrowfrom$24millionin2011to$26millionin2012.
Growth of the brand is supported by the improved performance of its new line of
manualandpowertoothbrushesfeaturingcharactersandlightsabersfromStarWars.
Privatelabel
In 2012, privatelabel products improve their already significant position in the

toothbrushescategory,withagrowthof7.4%.
Privatelabelproductssalesincreasefrom$94millionin2011to$101millionin2012,
withthemarketsharegrowingfrom13.0%in2011to13.6%in2012.
Inthecurrenteconomicclimate,manufacturersandretailersrespondtotheincreasein
demandwithmorestorebrandproducts.
RETAILDISTRIBUTION
Massmerchandisersremainthekeydistributionchannelfortoothbrushesin2012,withits
sharenearlyremainingflatwith2011.
Table4F28:ManufacturersSalesofToothbrushesintheUnited
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
46
46
Foodstores
32
31
Drugstores
22
22
100
100
Specialtystoresa
Total
aIncludesairport/hotelgiftshops.
MARKETINGACTIVITY
In 2012, television advertisements and freestanding inserts (FSIs) remain important for
marketersinthetoothbrushescategory.
FSIscontaincouponswithvaluesthatrangefrom$0.50to$1.00.
4F45
4F46
Toothbrushes
Procter&Gambleistheleadingadvertiserinthecategoryin2012with$21.6millionspent
intotaltraceablemediaexpenditures(TME),upsignificantlyfrom$18.3millionin2011.
Approximately, $20.7million in TME is allocated to OralB regular toothbrushes and
$20.8millioninTMEisallocatedtoOralBbatterytoothbrushes.
Procter&Gamblepromotesitstoothbrusheswithabout$54.6ofitsTMEontelevision
advertisements,followedby38.9%onInternetpromotions,and6%onmagazines.
Church& Dwight is the secondleading advertiser in the category, with 2012 TME of
$15.6millionforSpinBrush.
SpinBrushpromotionsthroughmagazinesandFSIsaccountforaboutonehalfoftotal
advertisingspend.Televisioncommercials(42.1%)andInternetdisplayadvertisements
(3.4%)accountfortheremainingpromotionalexpenditures.
Dr. Freshs $1.7million advertising spend in 2012 is almost completely allocated to the
promotionofitsReachTotalCaretoothbrushes.
TMEsarespentalmostexclusivelyonmagazineadvertisements.
Furthermore, the company mounts a number of social mediabased initiatives to
supportitsFireflytoothbrushes.
In2012,Dr.FreshteamsupwithDavidDeVore,the9yearoldstaroftheviralYouTube
video"DavidAfterDentist,"topromotegoodoralcarehabitsinchildren.
DataonTMEaredetailedintheAdvertisingsectionofthisreportandinthedatabase.
OUTLOOK
Salesoftoothbrushesareexpectedtogrowataslowbutsteadyrateof1.6%,overthenext
fiveyears.
Innovative product launches and strong marketing support will help drive the growth of
salesinthecategory.
Products with better technology and lower prices are expected to grow over the
The manual toothbrushes segment will experience greater growth in the childrens
segment and less in the adult segment, driven mainly by innovations, and better
marketingstrategies.
Marketers will continue to launch new and creative products with multiple benefits,
such as plaque removal, breath freshening, or gum massage to keep pace with the
growthinconsumerdemandandexpectations.
4A46
Toothbrushes
Toothbrushes that cater to specific oral care needs will perform better over the forecast
period.
Products that are designed for specific problems, including gum massage, plaque
removal,anddeepcleaningareexpectedtoseegrowth.
Childrensproductswillcontinuetoexpand,asparentsincreasinglyselecttoothbrushes
designedspecificallyforchildrenoradolescents.
Marketersareexpectedtoincreasetheirmarketingactivitytosupportthecategoryssales
SeveralleadingtoothbrushmarketersincludingProcter&Gamble,ColgatePalmolive,
and Dr. Fresh will continue to offer coupons including online and print coupons to
supporttheirrespectivesalesinthecategory.
Toothbrushmanufacturerswillcontinuetoinvestinadvertisingandspecialpromotions,
thereby reminding consumers of the importance of using the right tools to maintain
goodoralhealth.
Factors, including low prices and new product launches will support the sales of private
As privatelabel manufacturers offer greater variety, costconscious consumers will
increasinglypurchasestorebrands.
However,privatelabelproductswillconstraindollargrowth,butwillsupporttheunit
salesgrowth.
Sales are forecast to grow at a CAGR of 1.6% to reach $802million in 2017, up from
$741millionin2012.
Unit sales of toothbrushes are forecast to increase at a CAGR of 1.0%, from a rounded
349millionpackagesin2012toalmost366millionpackagesin2017.
4F47
4F48
Toothbrushes
4A48
TOOTHPASTES
CATEGORYPERFORMANCE
Manufacturerssales
In2012,salesfortoothpastesincrease1.7%to$1,749millionfrom$1,719millionin2011.
Dollar sales of toothpastes have increased at a compound annual growth rate (CAGR) of
1.5%peryearsince2007.
Table4F29:HistoricalSalesofToothpastesintheUnitedStates,
2011to2012
Year
$Million
Change,%
2007
1,622
2008
1,693
4.4
2009
1,682
(0.6)
2010
1,668
(0.8)
2011
1,719
3.1
2012
1,749
1.7
Unitsales
Unitsalesoftoothpastesareapproximately1,005millionpackagesin2012,up1.4%from
Retailsales
Salesoftoothpastesareroundedat$2,162millionattheretaillevelin2012,up2.0%from
4F50
Toothpastes
Table4F30:ManufacturersSalesofToothpastesintheUnitedStatesbyBrand,2011and2012
$Million
Brand
Company
Crest
%Oftotal
2011
2012
2011
2012
Procter&Gamble
637
618
37.1
35.3
Colgate
ColgatePalmolive
569
605
33.1
34.6
Sensodyne
GlaxoSmithKline
132
149
7.7
8.5
Arm&Hammer
Church&Dwight
82
83
4.8
4.7
Aquafresh
GlaxoSmithKline
84
80
4.9
4.6
Tom'sofMaine
ColgatePalmolive
46
48
2.7
2.7
Rembrandt
Johnson&Johnson
21
22
1.2
1.3
Aim
Church&Dwight
19
19
1.1
1.1
Orajel
Church&Dwight
17
16
1.0
0.9
Mentadent
Church&Dwight
14
12
0.8
0.7
CloseUp
Church&Dwight
14
13
0.8
0.7
Biotene
GlaxoSmithKline
13
13
0.8
0.7
Pepsodent
Church&Dwight
12
11
0.7
0.6
OralB
Procter&Gamble
0.5
0.5
Plus+White
CCAIndustries
0.4
0.5
Listerine
Johnson&Johnson
0.4
0.4
UltraBrite
ColgatePalmolive
0.4
0.3
Gleem
Procter&Gamble
0.1
0.1
CrestKids
Procter&Gamble
0.1
0.1
Privatelabel
14
15
0.8
0.9
Allother
14
14
0.8
0.8
1,719
1,749
100.0
100.0
Total
CATEGORYDEVELOPMENT
Markettrends
Toothpastesareconsideredacommoditywithhighhouseholdpenetrationandthecategory
remainsmaturein2012.
Overall,saleshavebeenmoderatelygrowingforthepastseveralyears.
Gainsforseveralleadingbrands,suchasColgateandSensodyne,aremainlyattributed
tonewproductlaunchesandheavypromotionalsupport.
Companiesloseandgainsharetoothercompetitors,butthereislimitednetexpansion
ofthecategory.
In 2012, ColgatePalmolive overtakes Procter& Gamble for the leadership position in
4A50
Toothpastes
Severalleadingmarketerscontinuetolaunchnewproductsin2012,therebysupportingthe
moderatesalesgrowthofthecategory.
ColgatePalmolive extends its Colgate Optic range with Enamel White variant, and
Colgate Max White line of professionally inspired daily toothpastes, and Toms of
MaineBotanicallyBrightwhiteningtoothpaste.
TheColgateOpticWhitetoothpasteisinfusedwithsodiummonofluorophosphate,an
activewhiteningingredient,andtherangeincludesSparklingMint,CoolMildMint,and
EnamelWhitevariants.
Procter&GambleintroducesCrestProHealthClinicalPlaqueControlToothpasteand
Crest3DWhiteGlamorousWhiteToothpaste.
Multibenefittoothpastescontinuetosupportthesalesgainofthecategoryin2012.
Toothpastes that provide multibenefits including battling tooth sensitivity, teeth
whitening,andpreventingplaquesupportthecategorysgrowth.
Amongthemultibenefittoothpastes,whiteningtoothpastesseegoodgrowthin2012,
supportedbythelaunchofnewwhiteningproductsincludingColgateOpticWhiteand
Crest3DWhitetoothpastes.
Toothpastes that provide therapeutic and sensitivity benefits, such as Sensodyne
Pronamelforsensitiveteethwitnessdoubledigitgrowthin2012.
Consumers who suffer from sensitive teeth are estimated to account for about one
quarteroftheU.S.population.
Consumerscontinuetoseekvalueforproducts.
Consumersprefermultibenefitproductsastheymoreattractiveandaffordablethan
havingtopurchasemultipleproducttypes.
Toothpastes that offer multibenefits including cavity protection, whitening, and/or
numbingeffectsforsensitiveteetharemoredesirable.
Premiumpricedproductsmustdemonstrateexcellentresultstostaycompetitive.
Consumers continue to increasingly utilize coupons and take advantage of special
promotions.
Thecategorycontinuestoseenewmarketersenterthemarketin2012.
Hello Products, based out of New Jersey, introduces a new line called 99% natural
oralcareproductsincludingtoothpastes,mouthwashes,andbreathfreshenersunder
the brand name Hello. Hello toothpaste offers benefits, such as strengthens and
whitens teeth, and reduces the effects of acid erosion and tartar buildup. The
toothpastegentlyandsafelypolishesstainsofftheteeth,andhelpspreventcavities.
The marketer launches the new oral care line to cater to consumers looking for
toothpasteswithnaturalingredients.
Privatelabelproductsareunabletoestablishasolidfoothold,duetostrongbrandloyaltyin
thecategory.
4F51
4F52
Toothpastes
Notablenewproducts
Table4F31:SelectNewToothpastesIntroducedintheUnitedStatesin2012
Company
Brand
Description
Church&Dwight
Arm&Hammer
Arm&HammerAdvancedWhiteBakingSoda&PeroxideFreshMinttoothpasteis
specificallyformulatedwithrefineddentalgradebakingsodatopreventnewstain
buildupinteeth.Besidesdeepcleaning,italsocontrolstartarandremovesplaque
Church&Dwight
Arm&Hammer
TheOrajelsensitivetoothpastecontainsalowabrasionformulathatisgentleron
theenamel,alsoprovidesrelieffrompainfultoothandnervesensitivity
ColgatePalmolive
Colgate
ColgateMaxFreshCoolCrystalsMinttoothpasteisafluoridetoothpastethathelps
tofreshenbreath,fightscavity,andwhitensteeth
ColgatePalmolive
Colgate
ColgateMaxFreshNightToothpastecontainszincwhichhelpstopreventgerm
buildupatnight
ColgatePalmolive
Colgate
ColgateMaxwithMouthwashBeadsTinglingMinttoothpastehasdissolvablemini
mouthwashbeadsthatcleansthemouth,helpsfightgerms,andpreventscavities
ColgatePalmolive
Colgate
ColgateOpticEnamelWhitetoothpastecontainsthesamewhiteningingredientas
whiteningstripsforwhiterteethinoneweekandfortifiesenamelforstrongwhite
teeth.
ColgatePalmolive
Colgate
ColgateMaxWhiteLiquidToothpasteprotectsagainstcavities.Thetoothpastehas
sodiumfluorideastheactiveingredient
ColgatePalmolive
TomsofMaine
BotanicallyBrightwhiteningtoothpasteissodiumlaurylsulfatefreeandfluoride
freetoothpastewhichisformulatedwithablendofbotanicalsthathelptowhiten
teethnaturally.Itisavailableintwoflavors:Spearmintwithaloeandchamomile
andpeppermintwithxylitolandpropolis
Dr.Fresh
Dr.Fresh
FireflyFluorideFoamtoothpastehasalight,foamyformulathatflushesout
bacteriaandgetstohardtoreachspots,specificallydesignedforchildrenwho
wearbraces
GlaxoSmithKline
Sensodyne
SensodynePronamelGentleWhiteningtoothpasteissugarfreeanticavity
toothpasteforsensitiveteethtoprotectagainstthegrowingproblemofacidwear.
Itprotectsteethagainstaciderosion,hardensenamel,andwhitensteeth
GlaxoSmithKline
Mentadent
MentadentAdvancedWhiteningRefreshingMinttoothpasteclaimstowhitenteeth
insevendays.Italsoaidsinremovingplaqueandpreventstartarbuildupbeforeit
forms
HelloProducts
Hello
Thetoothpastecontainsfluoride,whichisknowntohelppreventcavities.Itisfree
fromreportedlyharmfulingredientsincludingtriclosan
Johnson&Johnson
Rembrandt
RembrandtGentleWhitetoothpasteisspecificallydesignedforpeopleproneto
cankersores.Theproducthelpswhitenteethandstrengthenstoothenamel
withoutsodiumlaurylsulfate(SLS),whichhasbeenreportedtocauseirritation
KissMyFace
KissMyFace
TheTripleActiontoothpastecontainsxylitolandteatreeextractstohelpfight
cavitiesanditisfreefromsodiumlaurylsulfate,parabens,andartificialflavorsand
colors
KissMyFace
KissMyFace
TheWhiteningAnticavitytoothpastecontainsorganicaloeveratohealandsoothe;
Teatreetocleanseandactasanantiseptic;andIcelandMoss,anaturalwhitening
agent
(Continued)
4A52
Toothpastes
Table4F31:SelectNewToothpastesIntroducedintheUnitedStatesin2012
Company
Brand
Description
Procter&Gamble
Crest
CrestProHealthClinicalPlaqueControltoothpastehasaformulathatprotects
teethagainstplaque,gingivitis,cavities,andtoothsensitivity.Thistriclosanfree
toothpastealsohelpswhitenteethandpreventsplaquefromreoccurring
Procter&Gamble
Crest
CrestCompleteMultiBenefitExtraWhite+ScopeOutlastLastingMinttoothpaste
whitensteethbyremovingsurfacestainsandhelpsprotectagainstcavitiesand
tartars
Procter&Gamble
Crest
Crest3DWhiteAdvancedVividEnamelRenewaltoothpaste,ananticavity
toothpastewithsodiumfluorideasitsactiveingredient.Theproductisforpeople
agedoversixyears
Procter&Gamble
Crest
CrestProHealthClinicalGumProtectionInvigoratingCleanMinttoothpaste,ifused
formorethanfourweekshelpsreversegingivitisandimprovegumhealth.Italso
protectsfromteethsensitivity,cavities,plaque,andbadbreath
Procter&Gamble
Crest
TheCrest3DWhiteGlamorousWhitetoothpasteismadewithaformulathat
removessurfacestainsandsurroundsteethwithteethwhiteningagentsto
brightenthem
SunstarAmericas
GUM
GUMCrayolaSqueezeAColortoothpasteproductisavailableinavarietypackof
childsizetubesinthreeflavors:MelonBlast,BlueberryBurst,andJazzyApple.Itis
safetobeusedbychildrenagedabovetwoyears.Eachtubehasasmallnozzlethat
spreadsoutathinlineofpasteacrossthebrushtoencouragekidstobecreative
andusemultiplestripseverytimetheybrush
Vitacare
ChiaMint
ChiaMinttoothpasteincludesvitaminsA,C,D,Eandcalciumwhichhelptoheal,
protect,andstrengthengumsandteeth.TheproductsaresweetenedwithXylitol
andmarketedasglutenandfluoridefreeandsafeforpregnantwomen
Salesbyproducttype
Whitening toothpastes remain the largest segment, increasing 1.6% in sales in 2012 as
many leading marketers, such as Procter & Gamble and ColgatePalmolive introduce new
productswithwhiteningbenefits.
Salesofmultibenefittoothpastescontinuetogainpopularitywith1.3%increaseinsales.
Specialtyproductsseestronggrowthin2012,withsalesincreasingby5.3%,andsharerising
to10.2%,upfrom9.8%in2011.
StronggrowthbytheSensodyneRepair&Protectbrandcontributessignificantlytothe
increaseinsales.
GrowthbytheArm&Hammerbrandboostsbakingsodaandperoxidetoothpastessalesin
2012.
4F53
4F54
Toothpastes
Salesoftraditionaltoothpastesincreasemarginallyby0.5%,supportedbysalesofnatural
products.
Childrenstoothpastescontinuetoshownoticeablegrowth,with3.3%increaseinsales.
Table4F32:ManufacturersSalesofToothpastesintheUnitedStatesbyProductType,2011and2012
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Change,%
Whiteners
623
633
36.2
36.2
1.6
Multibenefit
468
474
27.2
27.1
1.3
Traditionala
201
202
11.7
11.5
0.5
Specialtyb
169
178
9.8
10.2
5.3
Tartarcontrol
86
86
5.0
4.9
Childrens
92
95
5.4
5.4
3.3
Bakingsodaandperoxide
69
70
4.0
4.0
1.4
Bakingsodac
11
11
0.6
0.6
Total
1,719
1,749
100.0
aIncludesregular,cavity,breathfreshening,natural,andvaluebrands.
bIncludessensitiveteethandgumcarevarieties.
cIncludesoriginalandtartarcontrolvarieties.
100.0
1.7
Salesbyproductform
The distribution of sales between pastes and gels is stable in 2012, with minor changes
comparedto2011.
Table4F33:ManufacturersSalesofToothpastesintheUnitedStatesbyProductForm,2011
and2012
Productform
2011
Paste
Gel
Total
$Million
%Oftotal
2012
2011
2012
946
968
55.0
55.3
2.3
773
781
45.0
44.7
1.0
1,719
1,749
100.0
100.0
1.7
4A54
Change,%
Toothpastes
Salesbypackagetype
Table4F34:ManufacturersSalesofToothpastesintheUnitedStatesbyPackageType,2011and2012
$Million
Packagetype
%Oftotal
2011
2012
2011
2012
Change,%
1,263
1,287
73.5
73.6
1.9
356
360
20.7
20.6
1.1
Total
1,619
1,647
94.2
94.2
1.7
PUMP
95
97
5.5
5.5
2.1
0.3
0.3
1,719
1,749
100.0
100.0
1.7
TUBE
Conventional
Standup
ALLOTHER
TOTAL
COMPETITION
Bycompany
Table4F35:ManufacturersSalesofToothpastesintheUnitedStatesbyCompany,2011and2012
Company
$Million
%Oftotal
2011
2012
2011
2012
Change,%
ColgatePalmolive
622
659
36.2
37.7
5.9
Procter&Gamble
647
628
37.6
35.9
(2.9)
GlaxoSmithKline
229
242
13.3
13.8
5.7
Church&Dwight
158
154
9.2
8.8
(2.5)
63
66
3.7
3.8
4.8
1,719
1,749
100.0
100.0
1.7
Allother
Total
In 2012, ColgatePalmolive overtakes Procter& Gamble for the leadership position in the
toothpastes market with 37.7% share, based on the strong performance of the Colgate
OpticWhitebrand.
ColgatePalmolivecontinuestoexperiencestrongsalesgains.
In 2012, ColgatePalmolives sales increase by 5.9%, up from $622 million in 2011 to
$659millionin2012.
Themarketshareofthecompanyincreasesfrom36.2%in2011to37.7%in2012.
ThestronggrowthofthemarketerisprimarilysupportedbythesuccessoftheColgate
OpticWhitebrandin2012.
The whitening toothpaste trend helps the brand grow its sales in 2012 and helps
strengthenColgatePalmolivespositioninthetoothpastescategory.
Newproductintroductions,suchasColgateOpticEnamelWhitewithformulationsfor
whiteningandsensitiveteethboostthecompanysperformancein2012.
4F55
4F56
Toothpastes
Procter&Gambleexperiencessalesdeclinein2012andthemarketerslidestothesecond
positioninthetoothpastescategory.
Sales of the company decline by 2.9%, from $647 million in 2011 to $628 million in
2012.
Themarketshareofthecompanyalsoslidesfrom37.6%in2011to35.9%in2012.
SalesofCrest,thecompanyslargestmasterbrandinthecategory,declineby3.0%to
$618millionin2012from$637millionin2011.
Thebrandssalesdeclineisinlinewiththedecreaseinthemarketingandadvertising
supportforitsbrandsin2012.
The marketer decreases the marketing support for the Crest brand significantly by
50.4%from$143.9millionin2011to$71.4millionin2012.
Procter&Gamblesincreaseinthepriceforitsproductsin2012isalsoamajorfactor
contributingtoitssalesdeclineinthecategory.
Decrease in couponing activity by the marketer in 2012 also limits the growth of the
companyinthecategory.
Limitednewproductactivityalsolimitsthegrowthofthemarketerin2012.
However, some of the key launches in 2012 by Procter & Gamble include Crest Pro
Health Clinical Plaque Control toothpaste and Crest 3D White Glamorous White
toothpaste.
GlaxoSmithKline remains the thirdleading marketer in the category with a 13.8% market
sharein2012,upfrom13.3%in2011.
Totalsalesofthemarketergrowby5.7%to$242millionin2012,upfrom$229million
in2011.
Growth in sales for GlaxoSmithkline is supported by Sensodyne, which experiences
stronggrowthandseesitsshareincreasefrom7.7%in2011to8.5%in2012.
SalesoftheSensodynebrandgrow12.9%,upfrom$132millionin2011to$149million
in2012.
The launch of Sensodyne Pronamel Gentle Whitening toothpaste and Sensodyne
Sensitivetoothpastesupportsthebrandsgrowthin2012.
Aquafresh, the next largest brand for the company, has a decrease in sales from
$84million in 2011 to $80million in 2012. The lack of new product activity and a
decreaseinmarketingactivitylimitsitssalesin2012.
Thebrandnowholdsamarketshareof4.6%in2012,downfrom4.9%in2011.
Biotene, a much smaller brand used to treat excessive tartar, dry mouth, and oral
irritations,remainsflatatjust$13millionin2012.
In2012,GlaxoSmithKlinelaunchesnewproductsundertheSensodynebrand.
The marketer supports its new launch, Sensodyne Pronamel with traceable media
expenditure(TME)of$19.5millionin2012.
4A56
Toothpastes
Church& Dwight remains in fourth place with an 8.8% market share, down from 9.2% in
2011.
Totalsalesin2012are$154million,comparedto$158millionin2011.
Arm&Hammer,thecompanysleadingbrand,hasa4.7%marketshare.Salesareupby
1.2%to$83millionin2012from$82millionin2011.
TheintroductionofmultibenefittoothpasteundertheArm&Hammerbrandsupports
thebrandsgrowthin2012.
During2012,Church&DwightlaunchestwosignificantnewproductsundertheArm&
Hammerbrandinthetoothpastescategory:AdvancedWhiteBakingSoda&Peroxide
FreshMinttoothpasteandOrajelSensitivetoothpaste.
Sales of privatelabel products grow 7.1% in 2012 to $15million, up from $14million in

2011.
Theprivatelabelscategorysharegrowsslightlyfrom0.8%in2011to0.9%in2012,but
furthergrowthisoffsetbytheincreasingcompetitionfromnationalbrands.
However, with heavy promotions and new product launches from national brands
includingColgate,Crest,andSensodyne,consumerssticktobrandedproducts.
RETAILDISTRIBUTION
In2012,foodstoresandmassmerchandisersremaintheprimarydistributionchannelsfor
toothpastes,withtheproportionofsalesthrougheachoutletunchangedfrom2011.
Table4F36:ManufacturersSalesofToothpastesintheUnitedStates
%Oftotal
Retailoutlet
2011
Massmerchandisers
44
44
Foodstores
37
37
Drugstores
18
18
100
100
Specialtystoresa
Total
aIncludesairport/hotelgiftshops.
2012
MARKETINGACTIVITY
Advertisementsandpromotionalactivityremainimportantinthetoothpastescategory.
Marketerscontinuetosupportnewproductswithextensiveadvertisingcampaigns.
Themarketingandpromotionalactivityalsodrivesthesalesforbothexistingandnew
products.
4F57
4F58
Toothpastes
Feature advertising, displays instore, and temporary price reductions (TPR) are the three
typesofpromotionsfoundtypicallyinthecategory.
Couponsremainanimportantpromotionalmediumformanufacturers,asmanyoffer
couponsof$0.50to$3.00offonpremiumbrands.
Leading marketers including ColgatePalmolive, GlaxoSmithKline, and Procter &
Gambleofferdiscountcouponstosupporttheirsales.
Television advertising continues to be the main media of advertising followed by print

media.
Televisionadvertisingaccountsforalmost80%ofallTMEin2012.
Printmediapromotionsthroughadvertisementsinmagazinesaccountfor16%ofthe
advertisingexpenditures.
Internetdisplayadvertisingisincreasinginusage,accountingfor3%ofmediaspend.
TotalTMEspentbymarketersonthetoothpastescategoryis$338.3millionin2012,down
by6.1%,from$360.3millionin2011.
ColgatePalmolive is the largest advertiser in the category in 2012, with TME of
$104.3million in 2012, up from $81.7 million in 2011 to support several major new
productsandallocatesmorethanonethirdofitsTMEtosupportitsOpticWhitebrand.
GlaxoSmithKline invests $100.2million in TME in its brands in 2012, allocating three
quartersofthebudgettopromoteSensodyne.
Procter & Gamble decreases its TME support significantly by 39.5%, from
Church&Dwightallocates$39.7millionin2012,withthreequarterssupportingArm&
HammerSensitiveWhitening.
ColgatePalmolive is the largest advertiser in the category with total TME of more than
ColgatePalmoliveswhiteningbrandsreceiveonehalfofTMEsin2012,withatotalof
$56.6millionspent.
ThemarketerspendsaboutonethirdofitsTMEtosupportitsOpticWhitebrand.
ColgatePalmolive also offers discount coupons ranging $1.00 to $3.00 on its website
andmagazines.
ColgatePalmolive partners with Jeannie Mai, fashion expert, actress, and television
personality,topromoteitsOpticWhitebrandwiththetaglineGettheperfectsmile.
ColgateOpticWhitecontinuestobesupportedbyanintegratedmarketingcampaign,
includingbothdirectinstoreandoutofstoresupport.
ColgatePalmolive demonstrates methods to combine digital and outdoor advertising
to maximize impact with its Smile campaign. ColgatePalmolive uses a dedicated
Facebookpagewhereusersareencouragedtouploadpicturesofthemsmiling.These
arethenturnedintolargecollageposterswhichcanbeseeninsupermarkets,shopping
malls,andotherpointofsalelocations.
ColgatePalmolive also provides various applications that can be downloaded on
mobile phones, including Colgate Smile Capsule, Colgate Smile Sign, and MaxWhite
iPhoneApplication.
ColgateOpticWhitetoothpasteisalsosupportedbyanintegratedmarketingcampaign,
includingboth,directinstoreandoutofstoresupport.
4A58
Toothpastes
GlaxoSmithKlinefocusesitspromotionalactivitiesonSensodyne.
In2012,thecompanyallocatesabout$77.2millioninTMEtoSensodyne.Sensodyneis
mainly advertised through television advertisements, with almost 95% of the brands
advertising budget spent on television promotions. Magazine and Internet
advertisementsarealsoused.
TMEof$23.0millionareallocatedforAquafreshtoothpastein2012.
Procter&GambledecreasesitsTMEsignificantlyby39.5%from$143.9millionin2011to
$87.0millionin2012.
Procter & Gamble also decreases its couponing and discounting activity in 2012. For
example, in 2011, Procter & Gamble offered coupons worth $3.00, but in 2012 the
marketerofferscouponsworth$1.00onlyandforaverylimitedperiod.
CrestProHealthlineoftoothpastescontinuetogetextensivemediasupportin2012,with
TMEof$51.1million.
CrestCompleteandCrestwhiteningproducts(Crest3DWhiteandCrestExtraWhite)
splitmostoftheremaining$29.0millionTME,mostofwhichisallocatedtotelevision
advertising.
Procter&GamblesCrest3DteamsupwithGenArtandFashionDesignerWhitneyPort
topromotetheimportanceofhavingaglamorouswhitesmile.
Procter & Gambles brand Crest launches a new advertising campaign that allows
consumerstofindproductsnearbyorbuythemonlinethroughaniPhoneapplication.
ThecampaignispartofabroadermarketinginitiativetopromoteanewlineofCrest
andOralBproductsthatfightplaque.
Data on TME by brand are included in the Advertising section of this report and in the
database.
OUTLOOK
The category is expected to experience slow and steady growth over the forecast period
supportedbynewproductlaunches.
Product innovation will continue to drive the categorys sales growth over the forecast
period.
Marketers are expected to introduce more innovative or multibenefit products to
supporttheirsalesgrowth.
Companies are also expected to launch products pertaining to specific oral care
problemsincludingsensitiveteeth,protectionagainstplaque,anddrymouth.
Singlebenefitproductoptions,suchasdedicatedwhiteningtoothpastes,areexpected
todecline,asconsumersincreasinglyexpectaplethoraofbenefitsfromeachproduct.
4F59
4F60
Toothpastes
Marketersareexpectedtocontinuetoprovidestrongpromotionalsupportfortheirbrands
The increasing promotional support from the marketers will also maintain brand
awareness.
Privatelabel sales are expected to remain flat or decline due to strong marketing
supportbytheleadingmarketersinthecategory.
New manufacturers, such as Hello Products, Kiss My Face, and other niche personal care
andcosmeticcompanies,areexpectedtolaunchinterestingnewproductsinthecategory,
givingconsumersmorealternatives.
Natural products are not perceived to be critical in this category, however, will
continuetohavemodestgrowthaspenetrationslowlyincreases.
Growing public concern about synthetic ingredients, such as triclosan, will also spur
growthinnaturaltoothpastes.
Traditional product options are expected to decline as companies turn to better
technologies with improved formulations and multibenefit product introductions to
growmarketshare.
Productstargetingspecificagegroups,includingchildren,tweens,andteens,areexpected
to experience growth, as marketers, such as Procter & Gamble and Sunstar Americas
continuetolaunchsuchproductsinthecategory.
Someofthetoothpastesforchildrenlaunchedin2012includeGUMCrayolaSqueeze
AColor toothpaste by Sunstar Americas and Firefly Fluoride Foam toothpaste by Dr.
Fresh.
Companieswillcontinuetointroduceproductswithnewlicensedcharacters.
Productsfortweensandteenswillbepromotedheavilyoncompanywebsites.
Thespecificrequirementsoftheagingpopulation,andthehealthissuesthatmayarise
from increased medication, such as dry mouth, is likely to offer opportunities for
innovationandpromotion.
The recovering economy in the United States is expected to turn consumers towards
brandedproductsthatofferbothproductandvaluebenefits.
Consumers will continue to seek products that offer better benefits rather than
purchasepremiumpricedproducts.
However,inordertosavemoney,manyconsumersaregivingupwhiteningproducts
andmouthwashesinfavoroftoothpastesthatofferthesebenefits.
Companies will continue to leverage their total oral hygiene portfolio of crosscategory
productstobothretailersandconsumers,includingcoordinatedlaunchesandanextension
betweentoothpastes,toothbrushes,andmouthwashes.
4A60
Toothpastes
Toothpastesareusedbyvastmajorityofadultsandchildrentomaintaingoodoralhealth,
makingitsmarketpenetrationhigh.
Newuserswillmostlycomefrompopulationgrowth.
Sales are forecast to grow at a CAGR of 1.2% to reach $1,856million in 2017, up from
Unit sales of toothpastes are forecast to increase at a CAGR of 0.8% from 1,005million
packagesin2012to1,046millionpackagesin2017.
4F61
4F62
Toothpastes
4A62
TOOTHWHITENINGPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesoftoothwhiteningproductsdecline5.6%,from$287millionin2011
Since2007,manufacturerssalesoftoothwhiteningproductshavedeclinedatacompound
annualgrowthrate(CAGR)of0.2%.
Table4F37:HistoricalSalesofToothWhiteningProductsin
Year
$Million
Change,%
2007
273
2008
281
2.9
2009
285
1.4
2010
287
0.7
2011
287
2012
271
(5.6)
Unitsales
Unitsalesoftoothwhiteningproductsareapproximately17millionpackagesin2012,down
5.6%from18millionpackagesin2011.
Retailsales
Retail sales of tooth whitening products are estimated at $359million in 2012, down by
4F64
ToothWhiteningProducts
Table4F38:ManufacturersSalesofToothWhiteningProductsintheUnitedStatesbyBrand,2011and2012
$Million
%Oftotal
Brand
Company
2011
2012
2011
2012
CrestWhitestrips
Procter&Gamble
212
200
73.9
73.8
GoSmile
GoSmile
12
12
4.2
4.4
Aquafresh
GlaxoSmithKline
12
4.2
3.3
LusterPremiumWhite
Dentovations
2.8
3.3
Rembrandt
Johnson&Johnson
2.4
3.0
Plus+White
CCAIndustries
1.7
1.5
Arm&HammerWhiteningBooster
Church&Dwight
1.4
1.1
KlearActionWhiteningLight
ThaneInternational
0.7
0.7
Dr.Georges
M&MInnovations
0.3
0.4
NaturalWhite
NaturalWhite
0.3
0.4
Listerinea
Johnson&Johnson
0.7
Privatelabel
15
16
5.2
5.9
Allother
2.1
2.2
287
271
100.0
100.0
Total
aDiscontinuedin2012.
CATEGORYDEVELOPMENT
Markettrends
The tooth whitening category is fairly mature and faces intense competition from multi
benefit toothpastes and the mouthwashes category, thereby leading to sales decline in
2012.
Increasing competition from oral care products, such as whitening toothpastes and
mouthwashesresultsinadeclineinsalesinthetoothwhiteningcategoryin2012.
Consumerscontinueto buytoothpastesandmouthwasheswithwhiteningproperties
astheyaremoreaffordablethanhavingtopurchasemultipleproducts.
Despite the economy recovering, consumers do not consider whitening strips to be as

essential as toothpastes, and the challenge for the marketers of whitening strips is to
providemultiplebenefitstoensurepurchase.
Consumerscontinuetoincreasinglyseekvalueforproductsinthecategory.
Premiumpricedproductsmustdemonstrateexcellentresults.
Consumersincreasinglyutilizecouponsandtakeadvantageofspecialpromotions.
4A64
Limited new product activity from several leading players results in sales decline in the
toothwhiteningcategoryin2012.
Procter&GambleintroducesCrest3DWhiteIntensiveProfessionalEffectsWhitestrips
thatclaimstoprovideprofessionalresultsinsevendays.
CCAIndustriesintroducesPlusWhiteOneStepwhiteninggelthatclaimstowhitenthe
teethinfiveminutes.
Declineinsalesofseveralleadingmarketers,suchasProcter&Gamble,GlaxoSmithKline,
andJohnson&Johnson,limitsthecategorysgrowthin2012.
Increasingcompetitionfromotheroralcareproductsthatusewhiteningagentsintheir
productstoprovideaddedvalue,limitsthecategorysgrowth.
Toothwhiteningstrips,rinses,andpensremainpopularinthecategory,comparedtothe
oldertrayform.
Notablenewproducts
Table4F39:SelectNewToothWhiteningProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
CCAIndustries
PlusWhite
PlusWhite5MinuteStainGuardrinseisformulatedwithPVP
(Polyvinylpyrrolidone),anonabrasivestainliftingpolymerthathelps
captureandremovestainsanddebrisfromtheteethssurface
CCAIndustries
PlusWhite
PlusWhite5MinutePremierSpeedWhiteningGelgentlyliftsaway
stainsandreducesteethyellowing
GoSmile
GoSmile
TheTouchSmileWhiteningPengivesbrighterandwhiterteethinless
thantwodays;alsosuitableforconsumerswithsensitiveteeth
Procter&Gamble
Crest
Crest3DWhiteIntensiveProfessionalEffectsWhitestripsusesashine
technologythatclaimstoremoveupto90%ofsurfacestainsinfive
days
4F65
4F66
COMPETITION
Bycompany
Table4F40:ManufacturersSalesofToothWhiteningProductsintheUnitedStatesbyCompany,
2011and2012
$Million
Company
2011
2012
Procter&Gamble
212
200
GoSmile
12
GlaxoSmithKline
2011
2012
73.9
73.8
12
4.2
4.4
12
4.2
3.3
(25.0)
Dentovations
2.8
3.3
12.5
Johnson&Johnson
3.1
3.0
(11.1)
CCAIndustries
1.7
1.5
(20.0)
Church&Dwight
1.4
1.1
(25.0)
25
26
8.7
9.6
4.0
287
271
100.0
100.0
Allother
Total
%Oftotal
Change,%
(5.7)
(5.6)
Procter&Gambleremainstheleaderinthecategory,withaslight decreaseinitsmarket
sharefrom73.9%in2011to73.8%in2012.
Collective sales for the marketer decline by 5.7%, from $212million in 2011 to
$200millionin2012.
Crestcontinuestobethemainbrandthecompanymarketsinthecategory.
Despiteanincreaseintraceablemediaexpenditure(TME)in2012,Procter&Gamble
experiencessalesdeclineduetolimitednewproductactivity.
Higher price points compared to its competitors also results in sales decline for the
In2012,Procter&GambleintroducesCrest3DWhiteGlamorousWhitetoothpasteand
Crest3DWhiteIntensiveProfessionalEffectsWhitestrips.
Go Smile is the secondlargest marketer in the category in 2012, moving ahead of

GlaxoSmithKlinewhichseesasteepdeclineinthecategory.
GoSmilescategoryshareincreasesfrom4.2%in2011to4.4%in2012,withthelaunch
ofGoSmilewhiteningpeninMay,2012.
Thewhiteningpenisamultiusebrushpenthatwhitensteethandalsominimizesteeth
sensitivity.Itistobeusedtwiceadayfortwoweeks.Ittargetspeoplewhodoforget
tousewhiteningproductsathomeandinsteadwanttousethemonthego.
GoSmileisaprestigebrandcarryingrelativelyhighpricesof$35.00to$120.00.
Theproductsareprimarilydistributedthroughcosmeticspecialtystores,suchasUlta
andSephora.
4A66
GlaxoSmithKline,whichtiedwithGoSmileforsecondplaceinthecategoryin2011,dropsto
thethirdplacein2012.Thecompanyexperiencesadeclineinitsmarketsharefrom4.2%in
2011to3.3%in2012.
Sales of Aquafresh White Trays drop sharply by 25.0% from $12million in 2011 to
$9millionin2012.
GlaxoSmithKline entered the category in 2007, but has not been able to significantly
buildsales.Itstrayformathasnotbeenaspopularwithconsumersastheeasytouse
andlessintrusivestrips.
The trays have not performed well as they are uncomfortable to fit and moreover,
cause a lot of inconvenience compared to whitening gels which are easy to use. The
marketerhasnotlaunchedanyotherformsinthecategory.
Johnson&Johnsondropstofifthplacein2012,experiencingadeclineinmarketsharefrom
3.1%in2011to3.0%in2012.
Listerine was discontinued from the market in 2011, leading to the sales decline for
Johnson&Johnsoninthecategory.
ThediscontinuationofListerineWhiteningproductscan,tosomeextent,beaccounted
for by the lawsuit for patent infringement filed against the company in 2008 by
Procter&Gamble.
ThelawsuitprohibitedJohnson&JohnsonandMcNeilPPCfrommaking,selling,and/or
importing any products that infringes on Procter& Gambles patents for tooth
whiteningproducts.In2011,thecompanystoppeddistributingitswhiteningstrips.
The companys other brand, Rembrandt, has sales grow by 14.3%, from $7million in
2011 to $8million in 2012. The brands growth is supported by an increase in
promotionalactivityin2012.
Privatelabel
Privatelabelproductshold5.9%ofthemarketshareinthiscategory,upfrom5.2%in2011.
Privatelabel sales increase from $15million in 2011 to $16million in 2012, as
consumersseektokeepdownexpenses.
Lowerpricepoints,improvedformulations,andimprovedpackagingcontributetothe
growthofprivatelabelssales.
Entrants,suchasCVSJusttheBasicsprivatelabeltoothwhiteningproducts,stimulate
growthasthiscategorymatures.
RETAILDISTRIBUTION
In2012,theproportionofsalesthroughretaildistributionremainsflat.
Mass merchandisers continue to account for almost onehalf of the sales in the
category.
4F67
4F68
Table4F41:ManufacturersSalesofToothWhiteningProducts
intheUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
49
49
Drugstores
28
28
Foodstores
19
19
Professional
Specialtystores
100
100
Total
MARKETINGACTIVITY
Televisionadvertisements,electronicandprintmediaadvertisements,couponing,andretail
activitiesarethechannelsthatmarketersprefertoadvertisetheirtoothwhiteningproducts.
Television advertising remains the leading promotional method in the category,
followedbytheInternet.
Marketers in the category promote their products through electronic and print media
advertisements.
Televisionadvertisementsarethemostcommonpromotionalmeans,withmorethan
75%ofthetotalmediaexpenditureinthecategoryin2012.
Internetpromotionsconstituteabout10%ofmediaexpenditure,andabout6%isspent
onmagazineadvertisements.
Couponsremainanimportantpromotionalmediumformanufacturersinthecategory.
Couponsrangefrom$1.00toashighas$10.00,dependingonthepriceoftheproduct.
Couponsarefrequentlyusedbecauseoftherelativelyhighpricepointsoftheproducts
inthecategory.
Marketers, such as Procter & Gamble, offer coupons worth $10.00 on their websites
fortheirtoothwhiteningproducts.
Marketersoftenattempttoenticeconsumerstotrynewproductswithcoupons.
In addition to freestanding inserts (FSIs), the leading marketers also promote their
brandsthroughdownloadablecouponsontheirwebsites.
Marketersalsousesocialmediatofurtherengagetheirconsumers.
Increasingly,mostbrandswebsiteshavelinkstotheirpresenceonsocialmediasites,
suchasFacebook,Twitter,andYouTube.
Severalleadingmarketers,suchas Procter&GambleandGlaxoSmithKline,usesocial
mediatosharedetailsaboutnewproductintroductions,coupons,sweepstakes,special
offers,events,anddetailsaboutsocialinitiatives.
4A68
TMEdedicatedfortoothwhiteningproducts,exclusiveoftoothpastes,growby80.1%,up
from$43.8millionin2011to$78.9millionin2012.
Procter& Gamble spends $53.7million promoting Crest tooth whitening products
during2012,reboundingfromaTMEof$40.2millionin2011,andremainsbyfarthe
topadvertiserinthetoothwhiteningcategory.
Johnson& Johnson increases media support to its Rembrandt tooth whiteners from
GlaxoSmithKlineshowsnoTMEonAquafreshwhiteningproductsin2012.
DetailsonTMEsareavailableintheAdvertisingsectionofthisreportandinthedatabase.
OUTLOOK
The mature tooth whitening products category is expected to decline marginally over the
forecastperiod.
The tooth whitening category growth will be limited by stiff competition from whitening
toothpastesandmouthwashes.
Usageoftheseproducts,increasinglymultibenefit,ismoreaffordableandconvenient
thanthepurchaseofaseparatetoothwhiteningproduct.
The introduction of new toothpastes and mouthwashes with claims of whitening will
continuetoposestrongcompetitiontotoothwhiteningproducts.
Marketers and retailers are expected to increase promotional activities and new product
introductionstosupportthegrowthoftoothwhiteningproductsovertheforecastperiod,
2012to2017.
There is a dire need for marketers to innovate and regularly introduce new tooth
whiteningproducts,whichthenneedstobeaggressivelysupportedthroughmarketing
andpromotionalefforts.
Betterpromotionalactivitiesandmorevisibilityofsuchproductsinretailchannelswill
alsohelpincreasesalesoftoothwhiteningproducts.
Continuedadvertisingwillalsohelpkeepbrandedproductsrelevantforconsumers.
Innovationsinthecategorywilldrivetheproductsalesovertheforecastperiod.
Innovations in product formats, such as gels and pens, are expected to support the
categorysgrowth.
Tooth whitening products with safe formulations, without causing damage to the
enamel,areexpectedtorevivesomeinterestinthecategory.
Tooth whitening products that will offer multibenefits, such as protection against
enamelorgumsareexpectedtopostgrowthinthecategory.
Newproductlaunchesbytopmanufacturers,suchasProcter&GambleandGoSmile,
arelikelytosupporttheoverallgrowthinthecategory.
4F69
4F70
Onthegowhiteningproductsthatcanbecarriedanywhereandprovideinstantresultsare
expectedtosupportthecategorysgrowthduringtheforecastperiod.
ManufacturerssalesareexpectedtodeclineataCAGRof0.5%from$271millionin2012
Unit sales of tooth whitening products are forecast to decline at a CAGR of 1.2% from
17millionpackagesin2012toalmost16millionpackagesin2017.
4A70
4G.SKINCAREPRODUCTS
INTRODUCTION
Skincareproductscleanse,moisturize,tone,protect,andotherwisecarefortheskin.
Includedinthissectionare:
Babycareproducts
Facialtreatments
Handandbodylotions
Suncareproducts
MANUFACTURERSSALES
Salesofskincareproductsgrow4.1%to$10,433millionin2012,upfrom$10,021millionin
2011.
The skin care product class continues to be dominated by the facial treatments
category,representing$6,645millioninsales,or63.7%oftotalskincaresalesin2012.
Figure4G1:ManufacturersSalesofSkinCareProductsintheUnitedStates,2012
Skincareproducts
formen,2%
Babycare
products,3%
Facialtreatments,
64%
Suncare
products,10%
Handandbody
lotions,22%
Total:$10,433Million
4G2
SkinCareProducts
Historicalsales
Since 2007, sales of skin care products have grown at a compound annual growth rate
(CAGR)of2.7%to$10,433millionin2012.
Table4G1:HistoricalSalesofSkinCareProductsintheUnited
States,2007to2012
Year
$Million
Change,%
2007
9,121
2008
9,373
2.8
2009
9,336
(0.4)
2010
9,653
3.4
2011
10,021
3.8
2012
10,433
4.1
Salesbytradeclass
Themassandluxurytradeclassescollectivelyrepresentabouttwothirdsofthetotalskin
caresalesin2012.
Themasstradeclasscontinuestobethelargesttradeclass,representing45.9%oftotal
skincaresalesin2012.
Theluxurysalestradeclassisatadistantsecond,accountingfor22.5%ofthetotalskin
careproductclasssalesin2012.
Thedirecttradeclassisinthirdplacewith17.0%ofsalesin2012.
The specialty trade class accounts for 7.6% of the total product class sales, while the
professionaltradeclassrepresents6.9%ofthetotalskincaresalesin2012.
Table4G2:Manufacturers'SalesofSkinCareProductsintheUnitedStatesbyTradeClass,2012
Facial
treatments
Handand
body
lotions
Suncare
products
Babycare
products
Skincare
products
formen
Total
%Of
total
Mass
2,247
1,303
888
285
68
4,791
45.9
Luxury
2,120
74
74
84
2,352
22.5
Direct
1,482
236
52
1,770
17.0
Specialty
97
646
34
17
797
7.6
Professional
699
24
723
6.9
6,645
2,283
1,048
288
169
10,433
100.0
Tradeclass
Total
$Million
4A2
4G3
SkinCareProducts
RETAILSALES
Retail sales of skin care products grow 4.3% to a rounded $16,482million in 2012 from a
rounded$15,810millionin2011.
COMPETITION
Table4G3:ManufacturersSalesofSkinCareProductsintheUnitedStatesbyCategoryandCompany,2012
Millionsofmanufacturersdollars
Facial
treatments
Handand
bodylotions
Suncare
products
Skincare
productsformen
Total
%Of
total
596
217
189
185
23
1,210
11.6
1,023
26
29
34
1,112
10.7
L'Oral
709
38
53
14
814
7.8
Procter&Gamble
609
20
637
6.1
17
542
18
582
5.6
MaryKay
449
95
550
5.3
GuthyRenker
526
526
5.0
Unilever
119
198
323
3.1
Avon
206
82
28
316
3.0
Kao
65
208
273
2.6
Allother
2,326
857
725
103
79
4,640
39.2
Total
6,645
2,283
1,048
288
169
10,433
100.0
Company
Johnson&Johnson
EsteLauder
LimitedBrands
Babycare
products
Thetop10companiesaccountfor$6,343millioninsalesor60.8%oftotalskincaresalesin
2012.
Thetopsevencompaniesremainunchangedfrom2011.
Unilever moves up to become the eighthleading marketer in the skin care products
classdisplacingAvontotheninthposition.
In 2012, sales of Avon decline due to various factors, such business restructuring,
declineinthetotalnumberofactiverepresentatives,warningfromtheFDAregarding
fewvariantsoftheAnewproductline,andtalksofapossiblebuyoutofthecompany.
4G4
SkinCareProducts
Johnson&Johnsoncontinuestobetheleadingmarketerintheskincareproductclassin
2012.
Salesofthemarketeradvance3.2%to$1,210millionin2012,upfrom$1,173millionin
2011.
Johnson&Johnsonrepresents11.6%oftotalskincaresalesin2012,marginallydown
from11.7%in2011.
Facialtreatmentscontinuetobetheleadingproductcategoryforthemarketer,with
salesat$596millionor49.3%ofthemarketerstotalskincaresalesin2012.
Johnson&JohnsonsNeutrogenaisthesecondlargestbrandinthemasssegmentwith
$347millioninmanufacturerssalesin2012,up5.2%from$330millionin2011.
OneofthemajorgrowthcatalystsforNeutrogenaistheNaturalslinewhichissaidto
be97%naturallyderivedandcontainsantioxidants.Thelineisextendedin2012with
MultiVitaminNourishingMoisturizer,whichisadailylotionthatreplenishesessential
nutrients.
In 2012, Neutrogena extends its acne line with the launchof AllInOne Acne Control
Treatment, which the company promotes as a multifunction product that is able to
fadethelookofacnescarswhilecontrollingpresentandpreventingfuturebreakouts.
Johnson & Johnson is the secondlargest marketer in the hand and body lotions
category, with sales at $217million in 2012, up 4.8% from $207 million in 2011. The
marketercompetesinthecategorywithitsAveeno,Neutrogena,Lubriderm,Johnsons,
andRoCbrands.
The marketers growth in the hand and body lotions category is due to the natural
positioning of its Aveeno brand and the formulation change of the Lubriderm line of
productsinlate2011,whichbecomevisiblein2012.
In the sun care category, Johnson & Johnson slides to become the thirdleading
marketer with sales at $189million in 2012, up 6.2% from $178million in 2011.
Johnson & Johnson is represented by two major brands in the category: Neutrogena
andAveeno.
Following a decline in 2011, Aveeno recuperates its sales in the sun care products
category in 2012 with the launch of its new Protect + Hydrate line of products
comprisingthreeSKUs.
Johnson&Johnsoncontinuestoleadthebabycareproductscategoryinspiteofsales
declineof1.1%from$187millionin2011to$185millionin2012.
Johnson&Johnsonhasbeeninthenewsfortheinclusionofunwantedformaldehydes
in its baby care products. The company has made claims to remove these
formaldehydes from its baby care products and the No More Tear Baby Shampoo by
2013.
Johnson&Johnsonsmoderategrowthinthebabycareproductscategoryisaffected
by the negative media coverage it has been receiving in the past few years with its
product recalls. Such news leads to a negative image about the brand among
consumers,therebyaffectingitssales.
4A4
SkinCareProducts
Este Lauder retains its position as the secondlargest marketer in the skin care product
class,withsalesat$1,112millionin2012,up8.5%from$1,025millionin2011.
EsteLauderrepresents10.7%oftotalskincaresalesin2012,upfrom10.2%oftotal
skincaresalesin2011.
EsteLauderistheleadingmarketerinthefacialtreatmentscategoryacrossalltrade
classeswithsalesat$1,023millionor15.4%oftotalfacialtreatmentssalesin2012.
EsteLaudersCliniquecontinuestobethelargestluxurybrandwithnearly22%share
ofthetotalluxuryfacialtreatmentsales.Salesgrow4.6%from$438millionin2011to
$458millionin2012.
WhileCliniqueiscertainlythecategorysleader,sevenpercentagepointsaheadofits
closest competitor, the brand continues to grow sales at a healthy rate, with some
market share lost during the year as other brands play catchup by introducing
products similar to those introduced by Clinique such as BB Creams and dark spot
correctors.
In2012,thesalesofthemarketeraredrivenbynewproductlaunchesduringtheyear
including Este Lauders Advanced Time Zone Age Reversing Wrinkle Crme, Este
LaudersPerfectionist[CP&R]WrinkleLifting/FirmingSerum,EsteLaudersReNutriv
ReCreationFaceCrmeandNightSerum,EsteLaudersReNutrivEyeBalmandNight
SerumforEyesandDayWearBBCrme,CliniquesDarkCircleCorrector,andCliniques
SkinFortifyingHydrator
In the skin care products for men category, Clinique Skin Supplies for Men is the
secondlargest brand with sales at $19million in 2012, an increase of 5.6% from
$18millionin2011.GrowthofthebrandissupportedbytheintroductionoftheAnti
FatigueCoolingEyeGelandtheDarkSpotCorrectorin2012.
LOralremainsthethirdleadingmarketerintheskincareproductclassin2012,withsales
at$814million,up7.7%from$756millionin2011.
LOralrepresents7.8%oftotalskincaresalesin2012,upfrom7.5%in2011.
LOralderives87.1%ofitstotalskincaresalesfromfacialtreatmentsproductsin2012.
LOralParisisthethirdlargestmassbrandinthefacialtreatmentscategorywithsales
of the brand up 3.2% to $227million in 2012, from $220million in the prior year.
Growthin2012isduetotheintroductionofproductsincludingYouthCodeBBCream
Illuminator,YouthCodeFoamingGelCleanser,andRevitaLiftTriplePower.
LOralsLancmeremainsthethirdlargestbrandintheluxurysegment,withsalesof
$243millionin2012,up5.7%from$230millionin2011.Salescontinuetogrowdueto
thesuccessofVisionnaireAdvancedSkinCorrector,whichmadeitsdebutin2011and
Gnifiquewhichwaslaunchedin2010.
Inthesuncarecategory,manufacturerssalesofLOralgrowatanaggressiverateof
12.8%to$53millionin2012,upfrom$47millionin2011.TheintroductionofLOrals
SublimeSunisthekeyreasonbehindthestronggrowthofthecompanyin2012.
4G5
4G6
SkinCareProducts
Procter&Gambleisthefourthleadingmarketerintheskincareproductclass,withsalesat
Procter&Gamblesshareintheskincareproductclassdeclinesfrom6.6%in2011to
6.1%in2012.
The marketer derives 95.6% of its total skin care sales from the facial treatments
categorywithsalesat$609millionin2012.
Procter& Gambles Olay remains the largest mass brand, accounting for slightly over
onequarteroftradeclasssalesinthefacialtreatmentsproductsclass.
Olayssalesinthefacialtreatmentsproductsdecline3.9%atthemanufacturerslevel,
from $593million in 2011 to $570million in 2012. A number of factors contribute to
Olayssoftsalesduring2012,includingincreasedcompetitionatmultiplepricepoints,
extensive marketing campaigns from competing brands, consumers trading up to
luxury products, mass private labels that mimic many of Olays product lines, and a
changeinretailerplanograms.
Procter & Gamble is one of the largest personal care advertisers and invests $125.3
millionsupportingtheOlaybrandduring2012,downfrom$197.3millionin2011.
Limited Brands retains its position as the fifthleading marketer in the skin care products
class,with5.6%oftotalskincaresalesin2012.
The companys sales in the product class total $582million in 2012, up 3.0% from
$565millionin2011.
LimitedBrandsgenerates93.1%ofitsskincaresalesfromthehandandbodylotions
categoryin2012.
LimitedBrandsrepresents23.7%shareoftotalhandandbodylotionscategoryssales
in 2012, up from a 23.3% share of the total categorys sales in 2011. Growth for the
marketer is supported by new product introductions and packaging changes to its
existinglineofproducts.
Bath&BodyWorksSignatureCollectionisoneofthebestsellingproductlinesforthe
company.
In 2012, the brand introduces the Pink Chiffon Body Lotion, Cashmere Glow Body
Lotion, Paris Amour Body Lotion, Paris Amour Triple Moisture Body Cream, and the
ForeverRedBodyLotion.
Also in 2012, the marketer brings about packaging changes to its Sweet Cinnamon
Pumpkinlineofproductscomprisingabodylotionandamoisturebodycream;Twilight
Woods line of products comprising a body lotion, moisture body cream, and body
butter; and Brown Sugar & Fig line of products comprising a body Lotion and a
moisturebodycream.
TheForeverRedproductlineisapremiumlineandisretailedatahigherprice.
In2012,VictoriasSecretssalesadvanceduetotheintroductionoflimitededitionskin
careproductsandapackagingchangeforitsPinklineofbodylotionsandbodybutters.
4A6
SkinCareProducts
RETAILDISTRIBUTION
The direct sales channel is the leading distribution channel in the skin care product class
representing22.1%ofthetotalproductclasssalesin2012.
Mass merchandisers is the secondlargest distribution channel generating
approximately21%ofskincaresalesin2012.
Department stores and drug stores account for 18.4% and 18.1% of the skin care
sales,respectively,in2012.
Table4G4:RetailDistributionofSkinCareProductsintheUnitedStates,2012
Retailoutlet
Facial
treatments
30
14
25
16
8
2
5
100
Handand
Suncare
Babycare
bodylotions
products
products
11
6
1
28
42
48
5
6
1
18
30
27
33
5
2
5
12
21
1
100
100
100
Directsales
Massmerchandisers
Departmentstores
Drugstores
Specialtystores
Foodstores
Professionaloutletsa
Total
aIncludesmedicalcareproviders,spas,andsalons.
Skincareproducts
formen
3
18
49
15
12
3
100
Weighted
average
22.1
20.8
18.4
18.1
13.0
4.2
3.4
100.0
OUTLOOK
Sales of the skin care product class are expected to grow at a CAGR of 4.5% from
$10,433millionin2012to$12,985millionin2017.
Growth of the category is expected to be fueled by the introduction of new and
innovativeproductsbackedbygoodresearchanddevelopmentfrommarketers.
New and improved product formulations, innovations in the form of packaging, and
attentionseeking marketing and promotional activities, including the popularity of
social media network channels and the growing acceptance towards mobile media
includingQRcodes,areexpectedtosupportthegrowthoftheskincareproductclass.
Skincareproductsofferingadditionalbenefits,suchasantiaging,naturalformulations,
andtherapeuticofferings,areexpectedtodrivesalesintheproductclass.
Majorityofthegrowthwillcomefromthefacialtreatments,thesuncareproducts,and
theskincareproductsformencategories.
Privatelabel products will continue to perform well across all skin care categories
except the facial treatments category where consumers choose wellestablished
brandedproductsoverprivatelabelproducts.
Consumersperceiveprivatelabelproductsasqualityproductsavailableatlowerprices
than products of national brands. Additionally, private label receives support from
retailersduetothehighmarginofprofitsearnedbytheseretailers.
Marketersarelikelytoinnovatewithpackagingformatsincategoriessuchassuncare
productsandfacialtreatments.
4G7
4G8
SkinCareProducts
Thefacialtreatmentscategoryisexpectedtoshowstronggrowthboth,invalueandvolume,
duringtheforecastperiodending2017.
Innovation backed by science will continue to be the main impetus to growing this
productcategory.
attributesinadditiontowrinklereductionandfirmingsuchasbrightening,luminosity,
andradiance.
Luxury facial treatmentproducts are anticipated to exhibit the most growth over the
next five years and are expected to become the largest trade class. More consumers
willbewillingtotradeuptowhattheyperceiveasbetterproducts.
Morenaturalingredientsarelikelytobeusedinfacialtreatmentproductsduringthe
forecastperiod.
Moisturizers/treatmentswillshowthemostgrowth.
Fadecreamsandwhiteningproductswillexperienceslightdeclineduringtheforecast
period, as most benefits offered by these products are being included in moisturizer
andtreatmentproducts.
The prevalence of acne along with unique facial cleansers that allow for better
absorptionofmoisturizersandtreatmentproducts,willkeepthesetwoproducttypes
growing.
Manufacturers sales of the hand and body lotions category are expected to grow
moderately.
Natural and organic products are expected to be the driving force behind the
categorysgrowthduringtheforecastperiodending2017.
Marketersareexpectedtoadoptinnovativemarketingtechniquesinordertopromote
theirproducts.
The consistent rise of the baby boomer population across the United States will
facilitatemarketersinexpandingtheirproductlineswithantiagingproperties.
Themassanddirectsaleschannelsarelikelytogrowduringtheforecastperiod.
Private label is expected to expand their product portfolio by offering good quality
multifunctionalproductsataffordableprices.
However,handandbodylotionsisamaturecategorywithahighlevelofcompetition
amongtheexistingbrandsandpresentsalimitedscopeforinnovation.
ThesuncareproductscategoryisexpectedtogrowataCAGRof7.2%duringtheforecast
period,2012to2017.
The introduction of the FDAs longawaited sunscreen monograph in late 2012 is
expectedtostimulatenewinterestinthecategory.
Naturalandorganicformulationswillcontinuetogainattentioninthecategory.
Research and development will continue to play a key role for the category as
marketers will look to innovate with product formulations, establish patented
technologies, add multifunctional benefits, and increasing the level of protection
againsttheUVraysforitsproducts.
However,theblurbetweentheskincareandsuncareproductsisexpectedtohavea
detrimentaleffectonthesuncarecategorysgrowthinthefiveyearforecastperiod.
Privatelabelproductswillcontinuetogrowthrough2017,butnotatthefastrateof
recentyears.
4A8
SkinCareProducts
Manufacturers sales of the baby care category are expected to grow at a CAGR of 1.0%
through2017.
The primary reason behind the marginal CAGR for the baby care products category
wouldbethestagnanttodecliningbirthrateintheUnitedStates.
Natural and organic products will continue to be the primary reason behind the
categorysgrowth.
Privatelabelproductsareexpectedtopostahealthygrowthastheytryandcompete
withwellestablishednationalbrands.
Manufacturers sales in the mens skin care products category are expected to grow at a
CAGRof5.4%duringtheforecastperiod.
Currentdevelopmentsintheformofgrowingdemandforantiaging,natural,andsun
careproductsaretestimonytothefactthatthecategoryhasstronggrowthpotential.
cleanseregimen.
already available in the market, will be another area for marketers to attract the
attentionofthemaleconsumers.
The skin care products for men category provides marketers an opportunity to shift
theirattentionfromthesaturatedfemalecentriccategories.
The marketing expenditure is expected to increase over the next five years, with
marketers concentrating more on promoting the mens skin care brands than the
femalecentricbrands.
Althoughprestigemarketersshallcontinuetoholdmajorityofthemarketshareinthe
category, market share for mass marketers are expected to grow faster than the
prestigebrandsduringtheforecastperiod.
ManufacturerssalesofskincareproductsareprojectedtoadvanceataCAGRof4.5%to
reach$12,985millionby2017,upfrom$10,433millionin2012.
Table4G5:ForecastManufacturersSalesofSkinCareProductsintheUnitedStatesby
$Million
Category
2012
2017
Facialtreatments
6,645
8,482
5.0
Handandbodylotions
2,283
2,500
1.8
Suncareproducts
1,048
1,480
7.2
Babycareproducts
288
303
1.0
169
220
5.4
10,433
12,985
4.5
Total
CAGR,%
4G9
4G10
SkinCareProducts
Unit volume of skin care products are projected to grow at a CAGR of 3.6% to
1,827.3millionpackagesby2017,upfrom1,530.5millionpackagesin2012.
Table4G6:ForecastUnitSalesofSkinCareProductsintheUnitedStatesbyCategory,
2012and2017
Millionpackages
Category
2012
2017
CAGR,%
Facialtreatments
670.0
823.0
4.2
Handandbodylotions
514.2
552.0
1.4
Suncareproducts
244.8
341.8
6.9
Babycareproducts
82.6
86.0
0.8
18.9
24.5
5.3
1,530.5
1,827.3
3.6
Total
4A10
BABYCAREPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesforthebabycareproductscategoryshowamarginalgrowthof1.8%
during2012.
Salesadvanceto$288millionin2012,upfrom$283millionin2011.
Sales of the baby care products category have grown at a marginal compound annual
growthrate(CAGR)of0.1%from$286millionin2007to$288millionin2012.
Table4G7:HistoricalSalesofBabyCareProductsinthe
Year
$Million
Change,%
2007
286
2008
278
(2.8)
2009
278
2010r
278
2011
283
1.8
2012
288
1.8
rRestated.
Unitsales
Unit sales of baby care products advance 1.7% to 82.6million packages in 2012, from
Retailsales
Retailsalesofbabycareproductstotalarounded$412millionin2012,up1.7%fromabout
$405millionin2011.
4G12
BabyCareProducts
Table4G8:ManufacturersSalesofBabyCareProductsintheUnitedStatesbyBrand,2011and2012
Product/type/brand
Company
$Million
2011
2012
%Ofsegment
2011
2012
%Oftotal
BABYBATHADDITIVES
2011
2012
Johnsons
Johnson&Johnson
60
57
57.7
53.8
21.2
19.8
Aveeno
Johnson&Johnson
15
16
14.4
15.1
5.3
5.6
BabyMagic
Naterra
5.8
5.7
2.1
2.1
CaliforniaBaby
CaliforniaBaby
3.8
3.8
1.4
1.4
BurtsBees
TheCloroxCompany
1.9
2.8
0.7
1.0
Mustela
ExpanscienceLaboratories
dbaMustela
1.0
0.9
0.4
0.3
Privatelabel
10
8.7
9.4
3.2
3.5
Allother
6.7
8.5
2.5
3.1
104
106
100.0
100.0
36.7
36.8
Total
BABYLOTIONS
Johnsons
Johnson&Johnson
40
39
53.3
50.0
14.1
13.5
Aveeno
Johnson&Johnson
11
12
14.7
15.4
3.9
4.2
BurtsBees
TheCloroxCompany
6.7
6.4
1.8
1.7
BabyMagic
Naterra
4.0
3.8
1.1
1.0
CaliforniaBaby
CaliforniaBaby
4.0
3.8
1.1
1.0
Mustela
dbaMustela
1.3
2.6
0.4
0.7
Privatelabel
10.7
11.5
2.8
3.1
Allother
5.3
6.4
1.4
1.7
75
78
100.0
100.0
26.5
27.1
37
37
61.7
61.7
13.1
12.8
Total
BABYPOWDERS
Johnsons
Johnson&Johnson
BabyGoldBond
Sanofi
3.3
3.3
0.7
0.7
Caldasene
HeritageProducts
1.7
1.7
0.4
0.3
Privatelabel
17
17
28.3
28.3
6.0
5.9
Allother
5.0
5.0
1.1
1.0
100.0
100.0
21.2
20.8
Total
60
60
BABYOILS
Johnsons
Johnson&Johnson
24
24
54.5
54.5
8.5
8.3
BurtsBees
TheCloroxCompany
2.3
2.3
0.4
0.3
Privatelabel
18
18
40.9
40.9
6.4
6.3
Allother
2.3
2.3
0.4
0.3
100.0
15.5
15.3
100.0
100.0
Total
44
44
TOTAL
283
288
100.0
4A12
BabyCareProducts
CATEGORYDEVELOPMENT
Markettrends
The category witnesses minimal activity in 2012 as a result of which manufacturers sales
advancebyamoderate1.8%during2012insyncwiththe2011levels.
Thekeyreasonbehindthecategorysmoderategrowthisthealmostflatbirthratein
theUnitedStates.
Furthermore, a rising trend towards the use of natural and organic products helps
elevatethecategorysgrowthto1.8%in2012.
Natural and organic products continue to be the primary factor behind the categorys
growth.
Mothers are becoming more ecofriendly and green in their approach, and are
increasinglydemandingproductsthatareformulatedwithnaturalingredientsforuse
ontheirbabysdelicateskin.
Burts Bees, a popular naturallypositioned brand, continues to perform well with its
growingproductrangeandexpandingdistributionnetwork.
Although offering similar benefits and result as regular baby care products, these
naturalandorganicproductsareavailableatahigherpricepointthannormalproducts.
Notably,consumersarewillingtopaytheextrapriceforthesenaturalproductssince
they not want any kind of risk or harm to their babys sensitive skin. However, the
trend for organic products is more prominent among affluent parents who have the
purchasingcapacitytobuypremiumpricednaturalproducts.
ThepracticallyflatbirthrateintheUnitedStateshasadetrimentaleffectonthecategorys
sales.
The birth rate in the United States in 2012 is estimated at 13.7 births per 1,000
populationascomparedto13.8birthsper1,000populationin2011.
Factorscontributingtothisdecliningbirthratearehighincidenceofawarenessamong
citizens through the various awareness programs including those on teen pregnancy
andtherisingcostoflivingandeducation.
4G13
4G14
BabyCareProducts
SPFformulatedproductsisanemergingandrapidlygrowingsegmentwithinthebabycare
productscategorywithanincreasingnumberofnewproductstargetedtowardsbabies.
Withgrowingawarenessabouttheharmfuleffectsofthesun,mothersareincreasingly
becomingprotectiveoftheirbabiesskin,whichisthinner,moredelicate,andsensitive
thananadultsskin.
Baby lotions containing an SPF factor are formulated with ingredients that are mild,
gentle,andsafeforthebabyssensitiveskin,andalsoachievetheprimaryfunctionof
providingUVprotectionsimultaneously.
A few leading sun care brands, such as Coppertone, Banana Boat, and Neutrogena,
offersuncareproductlinesexclusivelydedicatedtobabiesandkids.In2012,Johnson
& Johnson introduces a new Aveeno variant, the Baby Natural Protection Lotion
Sunscreen with broad spectrum SPF 50. However, sales for these products are not
includedinthebabycareproductsprofile.
Another rising trend is the availability of these sun care products for babies in spray
formats,makingitconvenientformotherstoapplytheseontheirrestlesstoddlerswith
ease.
Unlikeothercategories,thebabycareproductscategoryisnotledasmuchbyinnovation,
butratherbytrustandthepositioningofabrandinthemarket.
The baby care category, low on true innovation, depends upon the extension of
productlines,emergenceofnaturalandorganicproductlines,andintroductionofsun
careproductsforanincreaseinsales.
Consumerloyaltyisanimportantfactorinthiscategory.
Therehasbeenasurgeformultifunctionalproducts.
Marketers, such as California Baby, Burts Bees, and Baby Magic, offer products with
twoormoreadvantagesinasingleproduct.
A common example of this popular trend is seen in the multifunctional products
offeringshampooandbodywashbenefitsinasingleproduct.
In2012,NatureGateintroducestheBabySoothingShampoo&Wash.
Thereareafewbrandsinthemarket,suchasMonkeySeaMonkeyDoothatoffer3in
1productswithabenefitofashampoo,conditioner,andbodywash,allinoneproduct.
Thereisanupswingtowardsthepremiumbabyskincarebrandsasconsumersarelikelyto
tradeuptopremiumproductsforspecificresults.
Thepremiumbabyskincaresegmentprimarilycomprisesnaturalandorganicbrands
whichhaveshownasignificantgrowthinthepastfiveyears.
SomeofthesehighendbrandsincludeHonestCompany,LalabeeBathworks,Dr.Robin,
MDMoms,LoveMeBabyMe,Episencial,andCaliforniaBaby.
These premium baby care brands use a variety of natural and organic ingredients in
theirproductformulations,suchasLoveMeBabyMeusesorganicaloeandchamomile
inafewofitsproducts;MDMomsusesgingerrootextractinitswipesand;Lavanila
usesNonijuiceasakeyingredientinitsproducts.
4A14
BabyCareProducts
Privatelabelproductsdomoderatelywellin2012.
Retailers,suchasWalgreens,introducetheirownlineofbabycareproductswhichare
availableatapricelesserthanthosebeingofferedbythenationalbrands.
A tradedown activity is visible in only certain segments, such as baby wipes and
diapers,whichdonotfallwithinthescopeofthisstudy.
Notablenewproducts
Table4G9:SelectNewBabyCareProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
MonkeySea
MonkeyDoo
MonkeySea
MonkeyDoo
AllNaturalShampoo&BodyWashUnscented/FragranceFree2in1isa
hypoallergenic,tearfree,andfragrancefreehairandbodycleanser.Suitablefor
newbornbabies,infusedwithaloeleafextractandoliveoil
MonkeySea
MonkeyDoo
MonkeySea
MonkeyDoo
AllNaturalLotionisaneverydaygentleandmoisturizinglotionwhichisenriched
withaloeleafextractandoliveoil.ItisavailableinCherryAromaandUnscented
Fragrance
MonkeySea
MonkeyDoo
MonkeySea
MonkeyDoo
AllNaturalShampoo,Bodywash&Conditioner:CherryAroma3in1isa
hypoallergenic,tearfree,andfragrancefreeshampoo,conditioner,andbodywash.
Itisenrichedwithaloeleafextractandoliveoil,andcontainsanallnaturalcherry
aromascent
MonkeySea
MonkeyDoo
MonkeySea
MonkeyDoo
CherryConditionerisanallnaturalgentleandmoisturizingbabyconditionerthatis
freeofharshchemicals,andisenrichedwithgentlealoeleafextract,andoliveoil.It
issuitableforkidswithallergies,dryskin,eczema,andsensitiveskin
Naterra
BabyMagic
DryScalpTherapyBabyShampooisinfusedwithteatreeoilandmallowrootto
helpsootheandrelievedryscalpandcradlecap.Itisdermatologicallytestedand
hypoallergenic
Naterra
BabyMagic
DrySkinTherapyMoisturizingCreamenrichedwithsheabutterandalmondoilfor
analldaymoisturizingexperiencefordryskin.Itisvitaminenhanced,
hypoallergenic,anddermatologicallytested
SureSource
Natures
Gate
BabySoothingShampoo&Washisenrichedwithablendofexclusivebotanicals
includingchamomile,orangeflower,calendula,jojobaoil,sweetalmond,apricot
kerneloils,andvegetableglycerintogiveacleansingexperiencetothehairanda
soothingexperiencetothebabysdelicateskin
Walgreens
Ology
SoothingAromaTherapyBabyLotionLavender&Chamomilemoisturizes,softens,
andconditionsbabysskinwhileprotectingitfromdryness.Itisfreeofparabens,
silicones,dyes,phthalates,oranimalbyproducts
4G15
4G16
BabyCareProducts
Salesbyproducttype
Table4G10:ManufacturersSalesofBabyCareProductsintheUnitedStatesbyProduct
Type,2011and2012
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Babybathadditives
104
106
36.7
36.8
1.9
Babylotions
75
78
26.5
27.1
4.0
Babypowders
60
60
21.2
20.8
Babyoils
44
44
15.5
15.3
283
288
100.0
100.0
1.8
Total
Change,%
Babybathadditives
Babybathadditivescontinuetobethelargestsegmentinthecategory,representing36.8%
oftheentirebabycarecategoryssalesin2012.
Baby bath additives sales total $106million in 2012, up moderately by 1.9% from
$104millionin2011.
Growthinthecategoryisdrivenbytherisingtrendamongmanufacturerstointroduce
multifunctional products offering 2in1 functions and 3in1 functions. Common
examplesofsuchproductsincludeshampooandbodywashproductsorbubblebath
andbodywashproductsorshampoo,conditioner,andbodywashproducts.
A few popular multifunctional offerings in this segment include the California Baby
Overtired & Cranky Shampoo & Bodywash, California Baby Calendula Shampoo &
Bodywash,BurtsBeesBabyBeeShampoo&Wash,AveenoBabyWashandShampoo,
andJohnsonsBabyBubbleBath&Wash.
Johnsons (Johnson & Johnson) continues to be the leading baby bath additives brand in
2012.
In spite of a 5.0% sales decline from $60 million in 2011 to $57 million in 2012, the
brand continues to maintain its lead in the segment. Repeated press releases about
JohnsonsBabysPureandGentleShampoocontainingtracesofformaldehyde,suchas
carcinogenand1,4dioxaneproductshasadetrimentaleffectonthecompanyssalesin
2012.
ThecompanyclaimsthatitwillmakeamendstotheformulationofJohnsonsBabys
PureandGentleShampoobytheendof2013.
4A16
BabyCareProducts
AveenoandBurtsBeesaretheonlybrandstopostagrowthinthesegmentin2012.
Burts Bees is one of the few brands in the category to show a growth of 50.0%,
because of the small sales base of the brand in the segment. Sales increase from
$2millionin2011to$3millionin2012duetoitsexpandingretaildistributionnetwork.
Aveenopostsa6.7%growthwithmanufacturerssalesat$16millionin2012,upfrom
$15millionin2011.
Thepopularityofinnovativemultifunctionalproductsintheformof2in1and3in1
products adds to the sales gain for these brands and also, makes this segment a
dynamiconeinthebabycareproductscategory.
Babylotions
Babylotionscontinuetobethesecondlargestsegmentinthebabycareproductscategory
in2012,withsalesat$78million,up4.0%from$75millionin2011.
Johnsons Baby maintains its leading position in the segment, but, fails to perform in
2012withasalesdeclineof2.5%.
However,Aveeno,anotherJohnson&Johnsonbrand,performswell,withagrowthof
9.1%toreach$12millionin2012,from$11millionin2011.Inspiteofaproductrecall
of more than 2,000 tubes of its Baby Calming Comfort Lotion in 2012, the company
manages to show a healthy growth due to its established name in the market as a
manufacturerofnaturallypositionedbabycareproducts.
Sales of the specialty brand Mustela also advance 100.0% from $1 million in 2011 to
$2million in 2012 albeit from a small base. Growth is due to its expanding distribution
networkinSaks,Nordstrom,Ulta,sephora.com,andentryintoTargetinearly2012.
Privatelabel products also show good growth of 12.5% from $8 million in 2011 to
$9millionin2012duetochangingconsumerbehaviorsandperspectives.
Babypowders
Thebabypowderssegmentssalesremainflatat$60millionin2012.
The segment continues to stagnate due to absence of new or innovative product
activityinthesegment.
Sales of private label also remain dormant in this particular segment in spite of their
availabilityatcheaperpricesincomparisontonationalbrands.
Babyoils
Manufacturerssalesofbabyoilsarestagnantin2012at$44million.
JohnsonsBabycontinuestoremaintheleadingbrandinthebabyoilssegment,with
salesat$24millionin2012,flatfrom2011levels.
Salesofprivatelabelproductsremainsluggishat$18millionin2012.
Babyoilsisadecliningsegmentinthebabycareproductscategoryasitcontinuesto
losemarketshare.Thesegmenthasnotseenanynewproductactivitysince20102011.
Moreover,marketershaveverylimitedproductofferingsinthissegment.
4G17
4G18
BabyCareProducts
COMPETITION
Bycompany
Table4G11:ManufacturersSalesofBabyCareProductsintheUnitedStatesbyCompany,
2011and2012
$Million
Company
2011
2012
Johnson&Johnson
187
185
Naterra
TheCloroxCompany
CaliforniaBaby
2011
2012
66.1
64.2
3.2
3.1
2.8
3.1
2.5
2.4
Privatelabel
52
54
18.4
18.8
Allother
20
24
7.1
8.3
283
288
100.0
100.0
Total
%Oftotal
Johnson&Johnsoncontinuestoleadthebabycareproductscategoryin2012.
In2012,thecompanysmanufacturerssalesdeclineby1.1%from$187millionin2011
to$185million.
2013.
JohnsonsBabycontinuestodominatethecategorywithsalesat$157millionin2012,
down 2.5% from $161 million in 2011. The declining sales is attributed to the lack of
newproductactivity,dearthofinnovation,andthenegativemedianewssurrounding
itsproductrecallsin2012.
JohnsonsBabypostsdecliningsalesinthebabybathandbabylotionssegmentsand
stagnantsalesinthebabyoilsandbabypowderssegments.
Johnson&Johnsonsotherbrandinthecategory,Aveeno,showssalesgrowthof7.7%,
from$26millionin2011to$28millionin2012.Thehealthygrowthisattributedtoits
goodperformanceinboththebabybathandbabylotionssegments,throughwhichit
competesinthebabycareproductscategory.
AveenosOrganicHarvestline,launchedin2011,comprisingthreeSKUsisdiscontinued
in 2012 on account of losing its U.S. Department of Agriculture (USDA ) NOP
certification status as a result of the products containing an ingredient in their
formulationthatisnotonUSDAsNationalList.AlthoughtheOrganicHarvestlineisnot
availableonthecompanysofficialwebsite,itcanfoundoncertainonlineportalsand
ontheshelvesofafewretailers.
In August 2012, Aveeno makes a voluntary recall of its baby Calming Comfort Lotion
after the FDAs tests on a sample product showed exceeded specified quantities of
commonbacteria.However,theproductwasrelaunchedin2012afterprecautionary
measuresweretakenbythecompany.
4A18
BabyCareProducts
NaterraandTheCloroxCompanyaretiedforthesecondpositioninthebabycareproducts
categoryin2012.
SalesforNaterraremainstagnantat$9millionin2012;however,TheCloroxCompany
postsagrowthof12.5%toreach$9millionin2012,upfrom$8millionin2011.
ThemarketshareforNaterradeclinesfrom3.2%in2011to3.1%ofthetotalcategorys
salesin2012.
Ontheotherhand,themarketshareforTheCloroxCompanyadvancesfrom2.8%in
2011to3.1%in2012.
TheCloroxCompanysbrand,BurtsBeesintroducesitsnewlineofbabycareproducts
known as Burts Bees Baby in 2012 and also has an exclusive website for the entire
baby care range of products and accessories. This step helped the brand gain more
mediacoveragein2012therebybringingaboutmoreawarenessamongconsumers.
The positioning of Burts Bees products as containing natural and organic ingredients
andanexpandingdistributionnetworkalsoaidsinthecompanysgrowth.
SalesofCaliforniaBabyremainflatat$7millionin2012.
Sales for the brand increase marginally, but are not visible due to rounding and the
salesbeingfromasmallbase.
The company introduces a number of dual packs and kits for its already existing
productsin2012.
Sales of privatelabel products advance 3.8% in 2012 to $54million in 2012, up from

$52millionin2011.
Retailersaremakingconsciouseffortstoimprovethequalityandpackagingofprivate
label products and introduce innovative products in order to compete with the
established national brands. Also, retailers continue to place these privatelabel
productsrightnexttothebrandedproductsforconsumerstomakecomparisons,such
aspackaging,formulations,andthepricing.
Privatelabel products are increasingly being associated with quality and efficacy,
therebydrivinggrowth.
However,thereisastillacertainsectionofthesocietywhoprefersnationalbranded
productsoverprivatelabelproducts.
Table4G12:ManufacturersSalesofPrivatelabelBabyCareProductsintheUnitedStates,2012
Producttype
$Million
Privatelabel
Totalproducttype
Oils
18
44
40.9
Powders
17
60
28.3
Bath
10
106
9.4
78
11.5
54
288
18.8
Lotions
Total
%Oftotalproducttype
4G19
4G20
BabyCareProducts
RETAILDISTRIBUTION
In2012,massmerchandisersretaintheleadingpositionasthepreferredretaildistribution
channel,comprising48.0%oftotalretailsalesin2012,up1.0%from47.0%in2011.
Followinginthesecondpositionaredrugstores,whichcontributeto27.0%ofthetotal
sales,inlinewiththe2011levels.
Foodstorescontinuetocontributeto21.0%ofthetotalsalesin2012.
Table4G13:ManufacturersSalesofBabyCareProductsinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
49
48
Drugstores
27
27
Foodstores
21
21
Specialtystores
Directstores
Departmentstores
Total
100
100
aIncludesdepartmentstores,specialtystores,toystores,andthe
Internet.
MARKETINGACTIVITY
Johnson & Johnson is the leading advertiser in the category, with traceable media
expenditure(TME)at$31.4millionin2012,downfrom$31.9millionin2011.
Ofthis58.6%ofTME,or$18.4millionisallocatedtomagazineadvertisingandtherest
isallocatedacrosstheInternetandtelevisionmedia.
In 2012, Johnson & Johnson launches its website, safteyandcarecommitment.com,
whichinformsconsumersaboutthesafeuseandqualityofingredientsandaboutany
traceofchemicalsusedinitsproductformulations.Thewebsitewillbeupdatedwith
consumer feedback, new regulations, scientific developments, and information on
Johnson&Johnsonspolicies.
Themarketerofferscouponswith$1.00offonitsJohnsonsHeadToToeBodyWash.
Johnsons website established a platform encouraging moms to share their funny
storiesandadvice.
The brand also utilizes its website to provide useful and necessary information from
healthcareprofessionalsandexpertstonewmoms.
JohnsonsFacebookpageoffersadviceandtipstohandlevariousbabyproblems.
The marketer promotes its products in this page by advertising numerous discounts
thatcanbeavailedbytheconsumers.
Thecompanyswebsiteisalsoutilizedtopromotecouponsandspecialoffers.
4A20
BabyCareProducts
Popular promotional instruments include magazine advertising, television advertising,

onlinepromotions,sampledistributions,andinstorepromotions.
Socialmediapromotionisthemostfavorablemediumsincethemarketercaninteract
withtheconsumersonapersonalbasis.
Babycenter.com, a subsidiary of Johnson & Johnson, offers online education to new
parents.
Privatelabel brands, including those of Walgreens, CVS, and Walmart, promote their
productsbyofferingfreeshipping.
TMEinthetotalcategoryisapproximately$55millionin2012,up41.0%from$39millionin
2011.
Johnson & Johnson has the highest advertising expenditures in the category with its
TMEof$31.4millionin2012,down1.6%from$31.9millionin2011.
Johnsons, the leading brand in the category, receives the majority of TME, at
$14millionin2012,withJohnsonsBabylotionsreceivinganindividualTMEallocation
of$3.9million.
Naterra spends a negligible ($142,000) in TME for its baby lotion and baby powder
products.
Social network sites and magazines are the most popular promotional media for the
productcategory.
DetailsonTMEforthecategoryareprovidedintheAdvertisingsectionofthisreport.
OUTLOOK
Manufacturers sales of the baby care category are expected to post a marginal CAGR of
TheprimaryreasonbehindthemarginalCAGRforthebabycareproductscategoryis
thestagnanttodecliningbirthrateintheUnitedStates.
Natural and organic products will continue to be the primary reason behind the
categorysgrowth.
Privatelabelproductsareexpectedtopostahealthygrowthastheytryandcompete
withwellestablishednationalbrands.
The biggest driver for the category during the next five years would be the natural and
organicproducts.
Naturallypositioned brands, such as Aveeno, Burts Bees, and California Baby, will
continuetoproliferateasparentscontinuetospendonnaturalproducts.
Moreover,thisisanaddedopportunityfornewbrandstoenterthenaturalpositioned
segment,orforexistingnaturalbrandstoexpandintothebabycarecategoryandbe
successful.
4G21
4G22
BabyCareProducts
Johnson & Johnson, the pioneer in baby care products, will maintain its leading position
through2017.
Thecompanywillcontinuetomaintainitsleadingpositiondespitethenegativemedia
newssurroundingtherecallofitsJohnsonsBabyShampooandthediscontinuationof
Johnson&Johnsonwillcontinuetoenjoyafavorablebrandimagebecauseofitslong
historyinbabycareintheUnitedStates.Manyconsumerswillnotbepersuadedfrom
buyingitssignaturebrandortheAveenobrand.Therefore,thecompanyisprojectedto
recuperate from these setbacks during the forecast period, by reformulating and
employingaggressivemarketingtechniquestorepairitsreputation.
Privatelabel products are anticipated to grow its sales moderately during the forecast
period.
Inspiteoftheprivatelabelmarketersattempttointroduceandformulateitsproducts
asclosely/identicalaspossibletothoseofnationalbrands,growthwillbelimitedasa
certainsectionofconsumerswouldstillchoosenationalbrandsoverprivatelabels.
Themoderatelypricedprivatelabelcanonlydosomuchtoattractdemand.However,
privatelabelisexpectedtoincreasepricesslightlyinordertomeettherisingpricesof
therawmaterialsused.
Retailers, such as Walgreens, increasingly allocate more shelf space to privatelabel
productstoallowconsumerstomakedirectcomparisonswithnationalbrands.
TheSPFformulatedbabycarelotionsareexpectedtoperformwelloverthenextfiveyears.
Marketers will continue to introduce baby care lotions formulated with varying SPF
levels to give a wider variety of product offering to consumers to select from to suit
theirneeds.
The increasing education and awareness of sun exposure will make parents adopt
safety precautions for their babies by safeguarding their skin with SPFformulated
lotions.
ManufacturerssalesofbabycareproductsareanticipatedtogrowataCAGRof1.0%from
UnitvolumeisexpectedtoadvanceataCAGRof0.8%to86.0millionpackagesin2017,up
from82.6millionpackagesin2012.
4A22
FACIALTREATMENTS
CATEGORYPERFORMANCE
Manufacturerssales
The facial treatments market in the United States has another year of strong growth, up
4.5%during2012.
Sales are higher than they have been since 2007. The categorys sales reach
Inthewakeofanuncertaineconomyandaloomingfiscalcliff,coupledwitha super
stormthatseverelyaffectedandprovidedgreathardshiptotheNewYorkmetropolitan
area, and other tragedies, consumers continue to invest on themselves by spending
moneyonproductsanddevicestokeepagingatbay.
The highest percentage growth occurred among products in the luxury trade class,
followed by the professional trade class, indicating consumers further willingness to
spendonthemselvesandtotradeuptomorepremiumproducts.
Pricepointsamongmassproductsalsoincreaseduetomoretechnologicallyadvanced
ingredientsandvisibleresults.
Thequesttostayyoungerlookingisthemajorthrustforconsumerstoinvestinfacial
antiaging products by helping staveoff cosmetic surgery and procedures. Among
those who have already undergone such procedures, the use of facial treatment
productsfunctionsasanadjuncttohelpextendthelifeoftheseprocedures.
Duetoconcernsaboutfinancialissues,manyconsumersratevalueveryhighly.Value
continues to take many forms and can include the quality of a product, the type of
sales support that it provides, or even the bundling of products into kits that offer a
discountedpricecomparedtopurchasingeachoftheproductsseparately.
Products that offer visual results, such as lightening and brightening help propel the
categorysgrowth,andmovethewholeantiagingspectrumpastwrinklereductionand
firming.
Newproductstypicallycreateexcitementinthefacialtreatmentarenaandoneofthe
bigproductstoriesduring2012isthegrowthofBBcreams,thatareessentiallyhybrid
productsthatblurthedistinctionbetweenskincareandfacemakeup.Forthepurpose
ofthisreport,theyarecategorizedasfacialtreatments,andnotasmakeup.
Salesforfacialtreatmentsshowasteadyincreasesince2010,growing4.5%in2012,which
ismorethananyyearsince2007.
Since2007,manufacturerssalesincreaseatacompoundannualgrowthrate(CAGR)of
2.9%.
4G24
FacialTreatments
Table4G14:HistoricalSalesofFacialTreatmentsinthe
Year
$Million
Change,%
2007
5,762
2008
5,923
2.8
2009
5,860
(1.1)
2010
6,091
3.9
2011
6,360
4.4
2012
6,645
4.5
Table4G15:Manufacturers'SalesofFacialTreatmentsintheUnitedStatesbyTradeClassandBrand,2011and
2012
$Million
Tradeclass/brand
Company
2011
MASS
%Oftradeclass
2012
2011
2012
2011
2012
Olay
Procter&Gamble
593
570
27.3
25.4
9.3
8.6
Neutrogena
Johnson&Johnson
330
347
15.2
15.4
5.2
5.2
L'Oral
L'Oral
220
227
10.1
10.1
3.5
3.4
Clean&Clear
Johnson&Johnson
108
111
5.0
4.9
1.7
1.7
Aveeno
Johnson&Johnson
84
81
3.9
3.6
1.3
1.2
Garnier
L'Oral
61
76
2.8
3.4
1.0
1.1
Pond's
Unilever
62
63
2.9
2.8
1.0
0.9
Biore
Kao
54
58
2.5
2.6
0.8
0.9
RoC
Johnson&Johnson
52
52
2.4
2.3
0.8
0.8
Clearasil
ReckittBenckiser
52
49
2.4
2.2
0.8
0.7
Cetaphil
GaldermaLaboratories
46
47
2.1
2.1
0.7
0.7
AcneFree
ValeantPharmaceuticals
32
30
1.5
1.3
0.5
0.5
St.Ives
Unilever
29
29
1.3
1.3
0.5
0.4
Burt'sBees
TheCloroxCompany
27
29
1.2
1.3
0.4
0.4
LaRochePosay
L'Oral
22
27
1.0
1.2
0.3
0.4
Noxzema
Unilever
17
17
0.8
0.8
0.3
0.3
Oxy
RothoPharmaceutical
16
16
0.7
0.7
0.3
0.2
Eucerin
Beiersdorf
11
11
0.5
0.5
0.2
0.2
Simple
Unilever
10
0.4
0.2
PhysiciansFormulaa
Markwins
10
0.4
0.2
CeraVe
10
0.4
0.4
0.1
0.2
Dr.LewinnbyKinerase
0.3
0.4
0.1
0.1
(Continued)
4A24
%Oftotal
4G25
FacialTreatments
2012
$Million
Tradeclass/brand
Company
2011
MASS(Continued)
%Oftradeclass
2012
2011
%Oftotal
2012
2011
2012
Maybelline
L'Oral
0.4
0.4
0.1
0.1
DermaSilk
BiotechInternational
0.3
0.4
0.1
0.1
Lumene
LumeneOy
0.3
0.4
0.1
0.1
Avne
PierreFabre
0.3
0.3
0.1
0.1
Jergens
Kao
0.3
0.3
0.1
0.1
SeaBreeze
HelenofTroy
0.3
0.3
0.1
0.1
Palmer's
E.T.Browne
0.3
0.3
0.1
0.1
StriDex
Blistex
0.3
0.3
0.1
0.1
Phisoderm
RothoPharmaceutical
0.2
0.2
0.1
0.1
Vichy
L'Oral
0.2
0.2
0.1
0.1
Purpose
Johnson&Johnson
0.2
0.2
0.1
0.1
FaceLift
UniversityMedical
0.2
0.2
0.1
0.1
Almay
Revlon
0.2
0.2
0.1
0.1
Ambib
0.2
0.2
0.1
0.1
Boots
AllianceBoots
0.1
0.2
0.1
Esoterica
Medicis
0.1
0.1
Porcelana
Henkel
0.1
0.1
Zapzyt
Waltman
0.1
0.1
Privatelabel
120
127
5.5
5.6
1.9
1.9
Allother
127
143
5.9
6.4
2.0
2.2
2,171
2,247
100.0
100.0
34.1
33.8
Total
LUXURY
Clinique
EsteLauder
438
458
22.3
21.6
6.9
6.9
EsteLauder
EsteLauder
291
322
14.8
15.2
4.6
4.8
Lancme
L'Oral
230
243
11.7
11.5
3.6
3.7
Shiseido
Shiseido
98
104
5.0
4.9
1.5
1.6
LaMer
EsteLauder
75
94
3.8
4.4
1.2
1.4
PerriconeMD
PerriconeMD
79
84
4.0
4.0
1.2
1.3
Chanel
Chanel
70
77
3.6
3.6
1.1
1.2
Clarins
Clarins
68
71
3.5
3.3
1.1
1.1
StrivectinSD
Chrysallis
43
54
2.2
2.5
0.7
0.8
Kiehl's
L'Oral
44
52
2.2
2.5
0.7
0.8
ElizabethArden
ElizabethArden
51
50
2.6
2.4
0.8
0.8
Origins
EsteLauder
42
50
2.1
2.4
0.7
0.8
(Continued)
4G26
FacialTreatments
2012
$Million
Tradeclass/brand
Company
2011
MASS(Continued)
%Oftradeclass
2012
2011
2012
2011
2012
Philosophy
Coty
48
46
2.4
2.2
0.8
0.7
LaPrairie
Beiersdorf
35
37
1.8
1.7
0.6
0.6
BobbiBrown
EsteLauder
29
32
1.5
1.5
0.5
0.5
ChristianDior
LVMH
27
32
1.4
1.5
0.4
0.5
DDF
Procter&Gamble
31
28
1.6
1.3
0.5
0.4
LauraMercier
Alticor
24
28
1.2
1.3
0.4
0.4
MAC
EsteLauder
19
22
1.0
1.0
0.3
0.3
PeterThomasRoth
PeterThomasRothLabs
20
22
1.0
1.0
0.3
0.3
Dr.DennisGross
Skincare
Dr.DennisGrossSkincare
15
18
0.8
0.8
0.2
0.3
Guerlain
LVMH
16
17
0.8
0.8
0.3
0.3
Bliss
SteinerLeisure
16
16
0.8
0.8
0.3
0.2
BeneFit
LVMH
14
14
0.7
0.7
0.2
0.2
Dr.BrandtSkincare
Dr.BrandtSkincare
12
12
0.6
0.6
0.2
0.2
FashionFair
JohnsonPublishing
11
10
0.6
0.5
0.2
0.2
SKII
Procter&Gamble
10
0.4
0.5
0.1
0.2
Borghese
Borghese
0.5
0.4
0.1
0.1
BeautyBank
EsteLauder
0.4
0.4
0.1
0.1
OrlaneB21
Orlane
0.4
0.3
0.1
0.1
ErnoLaszlo
CharlesDenton
0.3
0.3
0.1
0.1
JosieMaran
JosieMaran
0.2
0.3
0.0
0.1
KateSomerville
KateSomerville
0.1
0.3
0.0
0.1
Givenchy
LVMH
0.2
0.2
0.1
0.1
Kinerase
11
0.6
0.2
0.2
0.1
Freeze24/7
Freeze24/7
0.1
Prescriptives
EsteLauder
0.1
Allother
Total
52
65
2.7
3.1
0.8
1.0
1,960
2,120
100.0
100.0
30.8
31.9
DIRECTc
MaryKay
MaryKay
451
449
30.8
30.3
7.1
6.8
ProActiv
GuthyRenker
353
389
24.1
26.2
5.6
5.9
Avon
Avon
217
202
14.8
13.6
3.4
3.0
MeaningfulBeauty
GuthyRenker
65
82
4.4
5.5
1.0
1.2
Artistry
Alticor
53
54
3.6
3.6
0.8
0.8
(Continued)
4A26
%Oftotal
4G27
FacialTreatments
2012
$Million
Tradeclass/brand
Company
2011
MASS(Continued)
%Oftradeclass
2012
2011
%Oftotal
2012
2011
2012
Hydroxatone
AtlanticCoastMediaGroup
65
52
4.4
3.5
1.0
0.8
Jafra
JafraCosmeticsInternational
39
38
2.7
2.6
0.6
0.6
Arbonne
Arbonne
29
29
2.0
2.0
0.5
0.4
BeautiControl
Tupperware
30
29
2.1
2.0
0.5
0.4
PrincipalSecret
GuthyRenker
26
26
1.8
1.8
0.4
0.4
NuSkin
NuSkin
24
25
1.6
1.7
0.4
0.4
Allother
GuthyRenker
21
13
1.4
0.9
0.3
0.2
XOut
GuthyRenker
10
0.7
0.2
Rodan&Fields
Rodan&Fields
0.5
0.5
0.1
0.1
YouthfulEssence
GuthyRenker
11
0.8
0.4
0.2
0.1
Mark
Avon
0.3
0.3
0.1
0.1
Pola
Pola
0.3
0.3
0.1
0.1
MaxClarity
GlaxoSmithKline
0.3
0.1
0.1
57
61
3.9
4.1
0.9
0.9
1,463
1,482
100.0
100.0
23.0
22.3
Allother
Total
PROFESSIONALd
Obagi
ObagiMedicalProducts
89
94
13.4
13.4
1.4
1.4
Skinceuticals
L'Oral
57
61
8.6
8.7
0.9
0.9
Dermalogica
Dermalogica
53
51
8.0
7.3
0.8
0.8
SkinMedicar
SkinMedica
43
51
6.5
7.3
0.7
0.8
Aveda
EsteLauder
35
36
5.3
5.2
0.6
0.5
Murad
Murad
34
35
5.1
5.0
0.5
0.5
JanMarini
JanMarini
19
20
2.9
2.9
0.3
0.3
336
351
50.5
50.2
5.3
5.3
666
699
100.0
100.0
10.5
10.5
Allother
Total
SPECIALTY
MerleNorman
MerleNorman
30
29
30.0
29.9
0.5
0.4
PatriciaWexlerM.D.
LimitedBrands
20
17
20.0
17.5
0.3
0.3
L'Occitane
L'Occitane
11
12
11.0
12.4
0.2
0.2
TheBodyShop
L'Oral
9.0
9.3
0.1
0.1
30
30
30.0
30.9
0.5
0.5
100
97
100.0
100.0
Allother
Total
TOTAL
6,360
6,645
aMarkwinsacquiresPhysiciansFormulain2012.
bValeantPharmaceuticalsacquiresAmbifromJohnson&Johnsoninlate2012.
cIncludeshomeshopping,infomercial,andotherdirectsalesbrands.
dRefertoKline&Company'sProfessionalSkinCareUSA,2010reportforfurtherdetails.
rRestated.
1.6
1.5
100.0
100.0
4G28
FacialTreatments
Unitsales
Unit sales of facial treatments in 2012 increase to 670million packages, up 2.3% from
655millionpackagesintheprioryear.
Unitsalesofmassbrands,whichconstitute60.7%oftotalunitsales,increaseby2.0%
to407millionpackages,whichislowerthanthedollarvolumeincreaseof3.6%.Thisis
duetopricepointsofmassproductsinchingupwards.
Luxurybrandsunitsalescontinuetoexperiencethehighestgrowth,up6.7%,dueto
thedollarsalesgrowthofthesebrands,alongwiththeslightdecreasesinproductsize
alongwithincreasesinpricepoints.
Unitsalesareweakinthespecialtyanddirecttradeclasses.
Table4G16:UnitSalesofFacialTreatmentsintheUnitedStatesbyTradeClass,2011and2012
Millionpackages
%Oftotal
Tradeclass
2011
2012
2011
2012
Change,%
Mass
399
407
60.9
60.7
2.0
Direct
139
140
21.2
20.9
0.7
Luxury
89
95
13.6
14.2
6.7
Professional
17
18
2.6
2.7
5.9
Specialty
11
10
1.7
1.5
(9.1)
655
670
100.0
100.0
2.3
Total
Retailsales
Retail sales of facial treatments are estimated at $10,871million in 2012, up 4.7% from
CATEGORYDEVELOPMENT
Markettrends
Antiagingremainsthemajorthrustofthefacialtreatmentscategory.
With an emphasis on looking younger, the definition of antiaging moves beyond
wrinkleminimizationandskinfirming,toincludeahostofproductsthatbrightenand
evenskintoneandprovideradiance.
While the antiaging theme remains virtually unchanged from 2011, some new and
moreeffectiveingredients,alongwithsomenewproductformshavebeendeveloped.
Oils,onceconsideredundesirableasacauseoffacialblemishes,havemadetheirway
intoavarietyoffacialtreatmentproductstoravereviews.
Retinols, once considered quite harsh for delicate skin, are now formulated for
gentlenesswhileincreasingineffectiveness.
4A28
FacialTreatments
The use of an increasing number of facial treatment products on a daily basis provides
incrementalsalesforthecategory.
While serums in facialtreatment products have been popular for thepast few years,
2012 sees the launch of serums specifically for the eye area, to be used with an eye
cream.
Eyeserumlaunchesaretypicallyextensionsoffacialtreatmentlines,suchasCliniques
Even Better Eyes Dark Circle Corrector, Este Lauders Advanced Night Repair eye
serum, and Lancmes Genifique Yeux LightPearl EyeIlluminating Youth Activating
Concentrate.
Theuseofmultipleserumsonthefaceisalsoagrowingtrend.Thesenewgeneration
serumstypicallycontaineitherdryoils,hyaluronicacid,orotheracids,andarelightin
textureforfastabsorptionsothattheycanbelayeredunderotherserums.Examples
launched during 2012 include Ferulic Acid + Retinol Brightening Solution from Dr.
DennisGross,BodyShopNutriganicsDropsofYouth,andEsteLaudersPerfectionist
CP+Rserum.
Other product types that create interest during 2012 include masks, peels, and oils,
whichwhilestillsmall,aregearedforgrowth.
Exciting new products armed with innovative properties create interest in the facial
treatmentscategory,andthisnewnesshelpstopropeltrialandincreasesales.
BB Creams, also known as beauty balms, blemish balms, or beauty benefit creams,
begantosurfaceintheUnitedStatesinlate2011withfewlaunches.Theseproducts
explodeonthescenein2012,withmostmajorfacialtreatmentandmakeupmarketers
launchingtheirownversionoftheseproductsduringtheyear.
BB creams function as hybrid products that offer both facial treatment and cosmetic
properties,offeringtreatmentbenefits,sunprotection,andotherattributesdepending
ontheproduct,allwiththegoalofaperfectskin.Somebrandsoffermultipleshades,
whileothersofferoneshadethatisappropriatetomostskintones.
Some of the most notable BB cream launches during the year include entries from
BobbiBrown,EsteLauder,Smashbox,LOralParis,Garnier,andLancme.
The trend of professional results athome that emerged in 2010, continues into 2012 as
women upgrade their facial treatment regimen to peels and more expensive athome
treatmentsinlieuofvisitingaprofessional.
RoCs Retinol Correxion Max Wrinkle Resurfacing System is a twostep system that
renewsthelookandfeeloftheskinandclaimstobeclinicallyproventobeuptofour
timesmoreeffectivethanaseriesofdermatologicalpeels.
GarniersSkinRenewalDarkSpotOvernightPeelisaglycolicpeelthatcanbeusedas
an overnight treatment to fade dark spots, even skin tones, brighten skin, and refine
thetextureofskin.
La RochePosays Redermic antiaging formula claims to combat wrinkles inspired by
dermatologistsapproachtoplump,fill,andhydrate.
AreformulatedversionofOlaysRegeneristMicroSculptingCreamclaimstoreverse10
yearsofwrinklesinfourweeksbyacceleratingskinturnover.
4G29
4G30
FacialTreatments
With an uncertain economy, consumers remain valueoriented, with the description of

valuemeaningdifferentthingsdependingontheperson.
Thecharacterizationofvaluecontinuestoevolveandincludesfactorsthatcontribute
tothedecisiontopurchaseaparticularitemorregimen.
Tosome,valuecanincludethebenefittothemobtainedwithpurchasinginaparticular
channelorretailer.Forexample,whetherapersonreceivesadiscount,freesamples,
orsalesassistanceisofvaryingimportancetodifferentindividuals.
Toothers,valuecanmeantheingredientsintheproducts,themannerinwhichthey
aresourced,thesustainabilitypracticesofacompany,orotherfactors.
Additionally, value can also include the ability to purchase a kit or bundled regimen
thatoffersalowerpricethanifeachproductispurchasedseparately.
Consumers are getting more savvy about their facial treatment purchases and conduct
extensiveresearchbeforemakingapurchase.
Themoreseriousfacialtreatmentpurchaserdoesnotmakeapurchasearmedwithout
adequate information, often using a smartphone at the pointofpurchase to check
pricesorproductreviews.
Consumersrefertoproductreviews,blogs,Facebook,andahostofothersocialmedia
optionstomakesurethattheyhaveselectedtheappropriateproductsfortheirfacial
concerns.
Facial treatment marketers are getting bolder about touting product benefits, which gets
noticedbytheFDA.
During 2012, the FDA continues to look at the marketing claims of facial treatment
products,especiallythosemakingclaimsofbiologicallyenhancedbenefits.
The FDA objects to claims such as rebuilds collagen, boosts the activity of genes,
damagedcellsrepairthemselves,etc.
In fall 2012, the FDA sends warning letters to companies such as Avon and Lancme
citingobjectionablemarketingclaims.
The impact and the steps taken by the FDA on such marketing claims, remains
unknown in early 2013. It is evident that marketers in the near future will need to
substantiatetheirclaims.
4A30
FacialTreatments
Anincreasingnumberofbeautyspecialtyretailersarelaunchingtheirownfacialtreatment
linesinthepasttwoyears.
These are not lines that mimic nationally advertised brands, but rather contain a
proprietarymixofingredientsgearedtotheneedsoftheretailerscustomerbase.
Sephora started the trend with the launch of the Sephora Collection in early 2011
whichissoldatallSephoraandSephorawithinJCPlocations.Theingredientinthese
linesisaproprietaryplantderivedingredientthatthecompanyclaimsismoreeffective
thannationallyadvertisedbrands.
UltalaunchesUltaSkincareinmid2012,afterapreviouslyunsuccessfulattemptatits
ownfacialtreatmentproducts.Theingredientstoryofthislineisaproprietarycomplex
calledAdvancedProtectionFactor+,saidtocombatfreeradicals.
Alsoinmid2012,the37storeBluemercurychainlaunchesM61,whichisanantiaging
linebasedonnaturalingredientswithscientificallyprovenresults.
In addition to the retailers own lines, beauty suppliers also search out exclusive or
licensedlinestocarrytohelpdifferentiatethemselvesfromtheircompetition.
PleaserefertoKline&CompanysBeautyRetailingUSA2012,formoreinformationon
privatelabelandexclusivebrandsacrossvariousbeautycategories.
Distributionstrategiescontinuetoexpandbeyondthecorechannelforabrand.
Theuseofecommerceandhomeshoppingnetworksisbecomingmorewidespread.
MajordepartmentstorebrandsincludingClinique,EsteLauder,andLancmetest
selling at cosmetic specialty stores, such as Sephora and Ulta. These tests are being
conductedatselectlocations.
Homeshoppingnetworksincreaseinpopularityasawaytolaunchnewproducts.
Sampledisseminationprogramsviaservices,suchasNewBeautyTestTube,Birchbox,
andBeautyfix,provideproductsfortrialtothesubscribers.
M&AActivity
ValeantPharmaceuticalsacquiresanumberofskincarebrandsduring2012andintoearly
2013.
In mid2012 the company acquires the Acne Free brand from University Medical for
approximately$64million.
Latein2012,itannouncestheacquisitionofAmbiSkinCarefromJohnson&Johnson
foranundisclosedsum.
Inearly2013,ValeantannouncesitsintenttopurchaseObajiMedicalproductsthrough
apurchaseofallitsoutstandingcommonstockforapproximately$344million.
Markwins International acquires the skin care and cosmetic brand Physicians Formula for
$75millionin2012.
4G31
4G32
FacialTreatments
Notablenewproducts
Table4G17:SelectNewFacialTreatmentsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Avon
Avon
AnewClinicalProLineEraserwithpatentedAF33(AminoFill33)claimstoworklike
potentantiagents.AHA,retinol,andinjectablecollagenreducethelookofdeep
wrinklesinoneweek
Avon
Avon
Genicslineisextendedwithaneyecream
Beiersdorf
LaPrairie
SkinCaviarLiquidLiftissaidtoliftandfirmtheskinstructure,protectandrestore
epidermalstemcellfunction,preventtheappearanceanddeepeningoflinesand
wrinkles
Beiersdorf
LaPrairie
CellularPowerComplex,whichincludesingredients,suchasSwisssnowalgaeand
tissueguidancematrix,issaidtofueldefenseandstimulatetheskinsnaturalrepair
processes.Productincludesginsengrootextract,horsetailextract,andglycoproteins,
saidtohelpstimulatetheskinsrenewalprocesswhilemoisturizingandenergizing
skin.Theformulaalsoincludespanthenolandsodiumhyaluronateformoisturizing
properties
Chrysallis
Strivectin
EVGetEvenSpotRepairisaconcentratedspottreatmentclinicallyproventovisibly
diminishstubbornspotsatthesourceforclearer,brighter,youngerlookingskin
Clarins
Clarins
SuperRestorativeTotalEyeConcentrateisatripleactionserumfortheeyeareathat
lifts,depuffs,andreplenishes
CloroxCompany
BurtsBees
IntenseHydrationisanewlinecomposedofCreamCleanser,DayCream,Night
Cream,TreatmentMask,andEyeCreamdevelopedtoprovideintensehydration.
ClarySage,abotanicalthatsurvivesinharshenvironmentsduetoitsabilitytoretain
moisture,istheinspirationbehindtheline
Dr.DennisGross
Skincare
Dr.DennisGross
Skincare
FerulicAcid+RetinolBrighteningSolutionclaimstoeffectivelysoftentheappearance
oflines,wrinkles,andenlargedporeswhilecounteractingdryness,redness,and
irritation.Developedwith2%activeretinolcomplex,thisovernighttimerelease
formulapromotesradiancebystimulatingcellrenewalandrevivingdullskin
Dr.DennisGross
Skincare
Dr.DennisGross
Skincare
ClarifyingColloidalSulfurMaskisanacnetreatmentthatclarifiestheskinby
absorbingexcessoilandacnecausingbacteriaovernight;rinsesoffinthemorning
E.T.Browne
Palmers
Twonewproductsareadded:CocoaButterFormulaEventoneBBcreamandCocoa
ButterFormulaEventonedarkspotcorrector.Bothproductsclaimtoincludeaskin
toneenhancingcomplex
EsteLauder
BobbiBrown
BBCreamcombinesmoisturizer,treatment,sunprotectionfactor,andlightmakeupin
oneproduct
EsteLauder
Clinique
EvenBetterEyesDarkCircleCorrectorisalightweight,oilfreehydratingeyeserum
claimedtobeclinicallyproventovisiblylightendarkcirclesby30%in12weeks.Skin
strengtheningingredientsmakeskinlesstransparent.Coolingmassagetipbreaksup
puffs.Sheeropticsinstantlybrightensallskintypes,fromfairtodark.
EsteLauder
Clinique
MoistureSurgeIntenseSkinFortifyingHydratorisacreamgelthatprovidesmaximum
hydrationplusabarriertostrengthenandrepairtheskin
EsteLauder
EsteLauder
AdvancedNightRepairlineisextendedwithaneyeserumtosmoothpuffinessand
firmtheeyearea
EsteLauder
EsteLauder
AdvancedTimeZoneAgeReversingLine/WrinkleCrmeclaimstohelprewindthe
visiblesignsofaginginjustfivedays
EsteLauder
EsteLauder
DayWearBBCrmefightsagainstenvironmentalhazardswhileprotectingtheskin
(Continued)
4A32
FacialTreatments
Company
Brand
Description
EsteLauder
EsteLauder
Perfectionist[CP+R]WrinkleLifting/FirmingSerumclaimstocorrect,prevent,and
repairskinbycreatingavirtual"forcefield"againstlinesandwrinklesby
superchargingnaturalcollagenbuildingpower
EsteLauder
EsteLauder
ReNutrivlineisextendedwithtwosetsofproductduos:ReCreationFaceCrmeand
NightSerum,andEyeBalmandNightSerumforEyes.Thesehighendproductsare
superchargedwithanewingredientsourcedfromthedeepwaterbeneathAntarctic
glacierscalledGlacialBioExtract
EsteLauder
Origins
MegabrightSkinToneCorrectingSerumclaimstobeclinicallyproventohelpreduce
theappearanceofdarkspotsinfourweekswhileinstantlyleavingskinbrighterand
moreradiant
EsteLauder
Origins
MakeaDifferencePlusRejuvenatingMoisturizerisarejuvenatingmoisturizerfortified
withRoseofJerichoplus,abreakthroughLycheeandWatermelonhydrasustain
complexwhichquenchesdeeptohelprepairthenaturalmoisturedeficiencyindry,
dehydratedskin.Clinicallyproventoinstantlyboostskin'smoisturereservoirtokeep
ithydratedandrejuvenatedallday
EsteLauder
Smashbox
CameraReadyBBcreamcontainsanoilcontrolformulationwithemollientsand
opticalpearlpigmentstoprovidehydrationandreducefinelinesandwrinklesafter
onlyfourweeks.Containssunprotectionandcomesinmultipleshades
GuthyRenker
XOut
Anewacnelineconsistingofawashindeliverysystemwithbenzoylperoxide(8.5%)
andmicrobeadstohelpexfoliatedeadskincells
Johnson&
Johnson
Aveeno
PositivelyAgelessCorrectingTintedMoisturizerisformulatedwithNaturalShiitake
ComplexandvitaminC,tohydrateandnourishfacialskin,tohelpvisiblyreducethe
appearanceoffinelinesandskindiscolorations
Johnson&
Johnson
CleanandClear
AdvantageOilAbsorbingTreatmentisdesignedforuseinplaceofaregular
moisturizer.Thisoilfreeacneformulacontainssalicylicacidtotreatbreakouts
withoutcloggingpores
Johnson&
Johnson
Neutrogena
AllInOneAcneControlTreatmentnoticeablyfadesthelookofpastacnemarks,
clearspresentbreakouts,andhelpspreventfutureacne
Johnson&
Johnson
Neutrogena
Naturalslineisextendedwithmultivitaminnourishingmoisturizer,adailylotionthat
replenishesessentialnutrients.Thecompanyclaimsthatthelineis97%naturally
derivedandcontainsantioxidants
Johnson&
Johnson
Neutrogena
UltraGentleDailyCleanserisanewcleanserformulatedforsensitiveskin
Johnson&
Johnson
RoC
RetinolCorrexionMaxWrinkleResurfacingSystemisatwostepsystemthatrenews
thelookandfeeloftheskinandclaimstobeclinicallyproventobeuptofourtimes
moreeffectivethanaseriesofdermatologicalpeels
Kao
Biore
CombinationSkinBalancingCleanserisanewcleanserforskinthatisacombination
ofdry,oilyandnormal.
LOral
BodyShop
NutriganicsDropsofYouthisayouthenhancingconcentratewithplantstemcell
technologytoenhancesurfaceskinrenewalforsmoother,healthierskin
LOral
Garnier
GarnierSkinRenewalDarkSpotOvernightPeelisaglycolicpeelthatcanbeusedasan
overnighttreatmenttofadedarkspots,evenskintones,brightenskin,andrefinethe
skinstexture
LOral
Garnier
SkinRenewMiracleSkinPerfectorBBCreamevenstone,brightenscomplexion,
renewsradiance,delivers24hourhydration,providesSPF15UVAandUVBprotection
(Continued)
4G33
4G34
FacialTreatments
Company
Brand
Description
LOral
Kiehls
ClearlyCorrectiveDarkSportSolutioncontainsvitaminC,whitebirch,andpeonyto
diminishnumberandintensityofdarkspots
LOral
LOralParis
YouthCodeBBCreamIlluminatorclaimstoeven,illuminate,perfect,correct,and
moisturizeinonestep.YouthCodeFoamingGelcleanserisanewcleanseraddedto
theYouthCodeline
LOral
LOralParis
RevitaLiftTriplePowerisafacialtreatmentcollectionwhichthecompanysays
containsthehighestlevelsofLOralsproprietaryProXylane,whichisanaturally
derived,biodegradablemolecule,extractedfromthebeechwoodplant.This
ingredientissaidtoenhancecollagenproduction.Designedtoaddressthree
dimensionsofagingwrinkles,lossoffacialvolumeandfirmnessthelineis
comprisesaDay/NightCream,Serum,andEyeTreatment
LOral
Lancme
AbsoluLExtraitisaregeneratingelixirthatclaimstorevealfirmer,moreelastic,more
radiantskin.Eachjarhasupto2millionrosenativecells
LOral
Lancme
GenifiqueYeuxLightPearlEyeIlluminatingYouthActivatingConcentratecontainsa
uniquerotatingandmassagingapplicatortoreacheventhemostinaccessibleeye
areaswith360degreeeyecontourapplication
LOral
Lancme
RnergieMultiLiftActionclaimstoshieldskinwithbroadspectrumSPF15and
restoresskinsyouthfulenergy.Addressingkeyagingconcerns,itlifts,firms,and
smoothensinfourweeks
LOral
LaRochePosay
Redermicantiagingformulaclaimstocombatwrinkles,inspiredbydermatologists
approachtoplump,fill,andhydrate
LOral
Maybelline
DreamFreshBBCreamprovideseightskinbenefitsforinstantskinperfection
LVMH
ChristianDior
OneEssentialMaskisaserumtomaskformulatoeliminatetoxinsandprovide
intensiverepair.Theproductcanbeappliedlightlyasleaveonserum,ormoreheavily
asamasktoberemovedin15minutes.
LVMH
ChristianDior
HydraLifeBBCreamisoneuniversalshadecombiningthemoisturizingandprotective
powersofaskincareproductwiththeimmediatecomplexionenhancingandeven
toningpropertiesofafoundation
MaryKay
MaryKay
TimewiseRepairVoluFirmLiftingSerumhelpsfirmandliftskinwhilerestoring
youthfulvolumeandvibrancysoskinappearstighterandlifted.Thisserumclaimsto
influencetheproductionofCollagenVII,minimizingdamagetotheproteinsinthe
dermalepidermaljunctionwhichcancausewrinkles
Markwins
Physicians
Formula
SkinCareMoistureBalancelineclaimstoprovideinstanthydration,foryounger
lookingandbalancedskinwithlesstightness,moreradiance,andmoistureretention
properties
Markwins
Physicians
Formula
SkinCareSensitivityandRednesslinecontainsMediACalm,aningredientthatclaims
todeliverantiirritantandsoothingpropertiestoreducerednesscausedbyexternal
irritation.Theingredientportulacaimprovestheappearanceofblotchinessoften
causedbypoormicrocirculationandhelpsstrengthendelicateskin
Markwins
Physicians
Formula
SkinCareAginglinetargetsthevisibleeffectsofchronologicalagingwhichoccurover
timeandphotoagingfromsunandenvironmentaldamage.Theseproductshelpto
preventandcorrectthemostcommonsignsofskinaging:theappearanceoffine
lines,deepwrinkles,andthelossoffirmnessandmoisture
(Continued)
4A34
FacialTreatments
Company
Brand
Description
Procter&
Gamble
Olay
ProXSpotFightingTreatmentissaidtoreducetheappearanceofdarkspotswith
hydrationtoimproveoverallskinforamoreeventoneandmicroexfoliationto
removedullnessforbrighterskin
Procter&
Gamble
Olay
TotalEffectsCCToneCorrectingLinetreatssevensignsofaging,whilealsoproviding
immediatecolorcorrectionwithtintedformulasthatincludeUVprotectionortone
correctionovertime.Themultipleinstantandlongtermbenefitsclaimtoleaveskin
eventonedwiththereducedappearanceofdiscoloration,finelines,andwrinkles
Procter&
Gamble
Olay
RegeneristMicroSculptingCreamReformulationclaimstoreverse10yearsof
wrinklesinfourweeks.Helpsaccelerateskinturnover
Shiseido
BareEscentuals
BareMineralsMultiWrinkleRepairclaimstoworkonmultiplelayersoftheskinto
diminishforeheadwrinkles,browfurrows,laughlines,andcrowsfeet
Shiseido
Shiseido
WhiteLucentIntensiveSpotTargetingSerumisabrighteningserumcreatedto
diminishstubborndarkspotsin10daysandpreventfuturepigmentationfrom
appearing
Unilever
Ponds
LuminousCleanCreamCleansercontainswhitekaolinclay,anaturalmineralknown
toactlikeamagnettodrawoutdeepdwellingimpurities,andmoisturizing
ingredients,suchasglycerintohelpleaveskinsoftandsmooth
Simple
AfacialtreatmentlinenewtotheUnitedStatescontainingnodyes,artificial
perfumes,orharshirritantsandishypoallergenic,noncomedogenic,andpH
balanced.Linecontainscleansers,wipes,moisturizers,andproductsforusearound
theeyearea
Unilever
Salesbytradeclass
Luxuryandprofessionalaretheonlytradeclassestodisplayaboveaveragegrowthduring
2012.
Theluxurytradeclassexperiencesthehighestgrowthof8.2%,asconsumersinvestin
theirfacialtreatmentregimensandlayeronanincreasingnumberofproducts.
The professional trade class grows 5.0%, with growth coming from brands, such as
Obagi,Skinceuticals,andSkinMedica.
Themasstradeclassgrows3.6%asmassbrandshoponthemultiproductbandwagon,and
offerahostofserumsandotherproductsthatencouragelayering.
Thedirecttradeclassgrowsjust1.3%,pulled downbysoftnessfrom Avonand Mary
Kay.
Thespecialtytradeclasscontinuestoexperiencedeclinesduring2012,down3.0%or
$3millionfromaverysmallbase.ThedeclineismostlyduetoamovementbyBath&
BodyWorksawayfromitsPatriciaWexlerMDlinetofocusonitsbathandbodylines.
4G35
4G36
FacialTreatments
Table4G18:ManufacturersSalesofFacialTreatmentsintheUnitedStatesbyTradeClass,2011
and2012
$Million
%Oftotal
Tradeclass
2011
2012
2011
2012
Change,%
Mass
2,170
2,248
34.1
33.8
3.6
Luxury
1,960
2,120
30.8
31.9
8.2
Direct
1,463
1,482
23.0
22.3
1.3
Professional
666
699
10.5
10.5
5.0
Specialty
100
97
1.6
1.5
(3.0)
6,359
6,646
100.0
100.0
4.5
Total
Salesbyproducttype
Themoisturizersandtreatmentssegmentexperiencesthemostgrowth,withanincreaseof
approximately$178millionduring2011,a5.0%increase.
While skin brightening and dark spot lighteners continue as the major antiaging
themesduringtheyear,BBcreamsalsocontributetosalesgrowth.
Sales also grow with the launch of multiple products in the brands regimen that
encouragelayeringwiththemultipleuseofserums.
In2012,serumsspecificallyfortheeyeareagainpopularity.
Salesofcleansersgrowaheadoftheaverage,at4.7%to$1,935million.
Consumersarebecomingmoreawareoftheneedforpropercleansingandexfoliation
inorderformoisturizersandtreatmentstoworkatoptimumlevels.
Acneaidsalsogrowslightlyfasterthanaverage,attherateof4.6%duringtheyear.
SolidgainsareexperiencedfromProactiventriesfromothermarketers.
Growth comes from new launches, such as Olay ProX Acne, along with healthy
increasesfromrevampedProactiv.
Whitening products and fade creams both experience declines as many of the
propertiesofferedbytheseproductsarenowincludedasbenefitsinmoisturizersand
treatments,suchaswhiteningandbrightening.
4A36
FacialTreatments
Table4G19:ManufacturersSalesofFacialTreatmentsintheUnitedStatesbyProductType,2011and2012
$Million
Producttype
2011
Moisturizers/treatments
3,546
Cleansersa
2012
%Oftotal
2011
2012
Change,%
3,724
55.8
56.0
5.0
1,849
1,935
29.1
29.1
4.7
Acneaids
614
642
9.7
9.7
4.6
Astringents/toners
129
127
2.0
1.9
(1.6)
Whiteningproducts
101
99
1.6
1.5
(2.0)
Makeupremovers
99
99
1.5
1.5
Fadecreams
21
20
0.3
0.3
(4.8)
Total
6,359
6,646
100.0
100.0
aIncludescleansers,masks,porestrips,facialtowelettes,andathometreatmentkits.
4.5
COMPETITION
Bycompany
Thetopfourcompaniesrepresent44.2%oftotalcategoryssalesin2012,upfrom44.1%in
2011.
Salesforthesefourcompaniesincreaseacombined5.0%,whichisabovetheoverall
categorysgrowthof4.5%.
EsteLauderisthecategoryleaderwitha15.4%share.
ItdominatestheluxurysegmentwithitsCliniqueandEsteLauderbrands.
Thecompanyssalesinthecategorygrow8.9%during2012,approximatelytwicethe
LOralholdssecondplacewithavarietyofluxuryandmassbrands.
Salesarestrong,up7.9%anda10.7%shareofthemarket.
Procter&Gambleholdsthirdplacewiththemasssegmentleader,Olay.
Procter & Gamble is the only one among the topfive facial treatment marketers to
experiencesluggishsalesduring2012.
4G37
4G38
FacialTreatments
Table4G20:ManufacturersSalesofFacialTreatmentsintheUnitedStatesbyCompany,2011and2012
Company
$Million
2011
2012
%Oftotal
2011
2012
Change,%
EsteLauder
939
1,023
14.8
15.4
8.9
LOral
657
709
10.3
10.7
7.9
Procter&Gamble
633
609
9.9
9.1
(3.8)
Johnson&Johnsonr
579
596
9.1
9.0
2.9
GuthyRenker
476
526
7.5
7.9
10.5
MaryKay
451
449
7.1
6.8
(0.4)
Avon
222
206
3.5
3.1
(7.2)
Allother
2,402
2,528
37.8
38.0
5.2
Total
rRestated.
6,359
6,646
100.0
100.0
4.5
Bybrand
Massbrands
Procter&GamblesOlayremainsthelargestmassbrand,accountingforslightlyoverone
quarteroftradeclasssales.
Thebrandssalesdecline3.9%atthemanufacturerslevel,from$593millionin2011to
$570millionin2012.Thebrandalsodeclinedin2010.
A number of factors contribute to Olays soft sales during 2012, including increased
competition at multiple price points, extensive marketing campaigns from competing
brands,consumerstradinguptoluxuryproducts,massprivatelabelthatmimicsmany
ofOlaysproductlines,andachangeinretailerplanograms.
Thebrandhaslostouttonewerinnovationsbycompetitors,suchasLOralandEste
Lauder.
Olay takes some major steps to become more innovative in late 2012 with the
reformulationofitsRegeneristlinetoofferfasterandmorevisibleresults.
The ProX franchise suffers as the price points for this mass line are comparable to
someentrylevelluxurybrands.Infact,theProXlineisthefirstmasslinetobreakthe
$25.00 price barrier,and open up the door for other mass brands to try as well. The
ProX line is extended with a Spot Fighting Treatment toreduce dark spots and even
outskintone.
During 2012, the company works to develop a new line that launches in early 2013
gearedforyoungerconsumers,andwithlowerpricepoints,calledOlayFreshEffects.
Procter & Gamble is one of the largest personal care advertisers and invests
$125.3million supporting the Olay brand during 2012, down from $197.3million in
2011.
4A38
FacialTreatments
Johnson& Johnsons Neutrogena is the secondlargest brand in the mass segment with
OneofthemajorgrowthcatalystsforNeutrogenaistheNaturalslinewhichissaidto
be97%naturallyderivedandcontainsantioxidants.Thelineisextendedin2012with
MultiVitaminNourishingMoisturizerwhichisadailylotionthatreplenishesessential
nutrients.
In 2012, Neutrogena extends its acne line with the launchof AllInOne Acne Control
Treatment which the company promotes as a multifunction product that is able to
fadeawayacnescarswhilecontrollingpresentandpreventingfuturebreakouts.
Advertising expenditures for Neutrogenas facial treatment brands are approximately
$14.0millionduring2012,adramaticdeclinefrom$88.3millionduring2011.
LOralParisfromLOralremainsthethirdlargestmassbrandinthecategory.
Manufacturers sales of LOral Paris increase 3.2% to $227million in 2012, up from
$220millionin2011.
Two new products are launched under the Youth Code line. Youth Code BB Cream
illuminatorisoneofthefirstmassBBcreams;andYouthCodeFoamingGelCleanser.
RevitaLiftlineisextendedwiththelaunchofTriplePower,alineofconcentratedfacial
treatmentproducts,targetedtorepairandfightwrinkles.Thecompanyclaimsthatthe
TriplePowerrangecontainsthehighestlevelsofthecompanysproprietaryProXylane,
which is a molecule extracted from the beechwood plant, said to enhance collagen
production. The Triple Power range has the highest price points among any of the
productsintheLOralParisportfolio,andisthefirstmassbrandtodirectlycompete
withOlayspremiumpricedProX.
Advertising expenditures for facial treatment products from LOral Paris are
approximately $25.0 million during 2012, down considerably from $129.1million
during2011.
There are several other fastgrowing mass brands that deserve special mention, a few of
thesebeingLOralsbrands.
Garnier grows 24.6% during 2012 due to the continual launch of innovative new
products which include Sin Renewal Dark Spot Overnight Peel which is an overnight
treatment to fade dark spots and even skin tones, and Skin Renew Miracle Skin
PerfectorBBCream.
TwomorebrandsfromLOral,LaRochePosayandVichy,eachgrowgreaterthan20%
duetosignificantlyexpandeddistribution.
ValeantPharmaceuticalsgainsinthemassfacialtreatmentareawiththerevampingof
CeraVe, the expanding awareness of Dr. Lewinn by Kinerase, and the late 2012
purchaseofAmbifromJohnson&Johnson.
Unilever brings its 50 year old Simple brand to the United States, which is aimed at
sensitive skin and is reported to be the leading facial treatment brand in the United
Kingdom.
4G39
4G40
FacialTreatments
Luxurybrands
Este Lauders Clinique continues to be the largest luxury brand with nearly 22% of total
luxuryfacialtreatmentsalesshare.
Salesofthebrandatthemanufacturerslevelgrowby4.6%from$438millionin2011
While Clinique is certainly the leader in the luxury category, seven percentage points
ahead of its closest competitor, sales continue to grow at a healthy rate. The brand
losessomemarketshareduringtheyearasotherbrandsplaycatchupbyintroducing
products similar to those previously introduced by Clinique, such as BB Creams and
darkspotcorrectors.
The Even Better line is expanded with a Dark Circle Corrector for the eyes and the
MoistureSurgelinelaunchesanIntenseSkinFortifyingHydrator.
Traceablemediaexpenditures(TMEs)forCliniqueare$55.3millionin2012,downfrom
$64.1millionin2011.
Este Lauders flagship brand Este Lauder is the secondlargest brand in the luxury
segmentwith$322millioninsalesin2012,up10.7%from$291millionin2011.
Severalnewproductlaunchesduringtheyearareallextensionsofitsexistinglines.
DayWearisextendedwiththelaunchofaBBCrme.
TimeZoneisextendedwithAdvancedTimeZoneAgeReversingWrinkleCrmewhich
thecompanyclaimscanrewindthevisiblesignsofaginginfivedays.
The Perfectionist line is extended with Perfectionist [CP&R] Wrinkle Lifting/Firming
Serumwhichclaimstocorrect,prevent,andrepairskinbycreatingavirtualforcefield
againstlinesandwrinklesbyacceleratingnaturalcollagenbuildingpower.
TheReNutrivlineisextendedwithtwosetsofproductduos:ReCreationFaceCrme
and Night Serum, and Eye Balm and Night Serum for Eyes. Both of these products
contain Glacial BioExtract, a new ingredient from the water beneath the Antarctic
glaciers.
TMEs for Este Lauder facial treatments are $47.7 million in 2012, up from
$44.5millionin2011.
LOrals Lancme remains the thirdlargest brand in the luxury segment, with sales of
Sales continue to grow due to the success of Visionnaire Advanced Skin Corrector,
whichmadeitsdebutin2011andGnifiquewhichlaunchedin2010.
The Gnifique line is extended with the launch of Gnifique Yeux LightPearl
Illuminating Youth Activating Concentrate, made specifically for the eyes with a
rotatingandmassagingapplicator.
TheRnergielineexpandswithaMultiLiftActionproductthatlifts,firms,smoothens,
andprotects.
TheAbsolulineisextendedwithLExtraitaregeneratingproductcontainingrosenative
cellstohelprevealfirm,moreelastic,andradiantskin.
TMEsforLancmeareapproximately$33.7millionin2012,downfrom$39.8millionin
2011.
4A40
FacialTreatments
Otherluxurybrandsshowingsizeablegrowthduringtheyearinclude,EsteLaudersLaMer
andOriginsandLOralsKiehls.
Expanding distribution, along with new product launches help each of these brands
growdoubledigitsduring2012.
Directbrands
Mary Kay continues to be the largest directselling brand of facial treatments products,
commandingover30%oftotaltradeclasssales.
The brands sales decline by $2 million to $449 million in 2012 as the company
strugglestomaintainanactivesalesforce.
DirectsalesistheonlybusinessmodelthatMaryKayfollows,utilizingrepresentatives
that can run their own business and conduct parties, classes, and oneonone
consultations.Mostoftheindependentrepresentativesalsohavetheirownwebsites,
and many customers choose to purchase directly from their website. During 2012,
several articles about Mary Kay are published in magazines, such as Forbes and
BusinessWeekthatindicatedifficultiesinmaintainingitsdirectsalesforce.
MaryKaytypicallydoesnotlaunchmanynewproductsinayear,yettheTimewiseline
isextendedin2012withRepairVoluFirmListingSerumsaidtohelpfirmandliftskin.
Mary Kay spends little on advertising and promotional dollars to support its facial
treatmentbrands,relyingonitssalesconsultantsandcatalogstopromotethebrand.
Proactiv (GuthyRenker) is the secondlargest brand in the segment, with $389million in

manufacturerssalesin2012,up10.2%from$353millionin2011.
Despite the sales increase, its business model of utilizing infomercials with celebrity
endorserscoulddraintheprofitabilityofthebrand,duetothehighcostofpurchasing
media, costs associated with infomercial production, and the cost of compensating
celebrities.
Sales grow due to several reasons including a number of new and young celebrity
endorsers, such as actresses Kaley Cuoco, Julianne Hough, and Naya Rivera; positive
endorsementsasbestacneproductbyseveralmagazines,lowintroductoryprice,and
withthebrandmakingmostofitsmoneyonreplenishment.
While no new products are launched during the year, the brand offers a cleansing
brushasagift.
ThebrandlosesseveralcompetitorssuchasMaxClarity,whichisdiscontinuedduring
theyear,causingthesecustomerstoseekoutotherbrandssuchasProactiv.
Avon is the thirdlargest directselling brand in the category with $202million in

manufacturerssalesin2012,down6.9%from$217millionin2011.
Thecompanystruggleswithitswellpublicizedproblemsofattractingandmaintaining
salesassociatesintheUnitedStates,andthecompanydevotesmuchofitsenergiesto
expandinginotherregionsoftheworld.
4G41
4G42
FacialTreatments
MajorfacialtreatmentlaunchoftheyearisanadditiontotheAnewClinicallinecalledPro
LineEraserwhichthecompanycomparestoinjectablecollagenandretinolstoreducethe
appearanceofdeepwrinklesinoneweek.
TheGenicslineisextendedinMarch2012withaneyecream.
Thecompanyspendsamere$2.2millionduring2012,downfrom$8.1millionduring
2011toadvertiseitsvariousfacialtreatmentproducts.
Professionalbrands
Obagi(ObagiMedicalProducts)isthelargestprofessionalskincarebrandinthecategory,
withsalesof$94millionin2012,up5.6%from$89millionin2011.
Growthisdrivenprimarilybytheincreaseinthenumberofaccountsandanumberof
marketinginitiativesthatareconductedtoincreasebrandawarenesstoreachoutto
both,physiciansandtheirpatients.
Oneofthemajornewlaunchesfor2012isElastidermEyeCompleteComplexSerum.
SkinCeuticals (LOral) is the secondlargest brand in this trade class with manufacturers
salesof$61millionin2012,up7.0%from$57millionin2011.
The brand continues to enjoy healthy growth in the medical care provider sector,
particularly in medical spas. In the spa sector, the brand strengthens its partnerships
withcoreaccounts,helpingitmaintainsalesinthechannel.
In2012,itlaunchesaloyaltyprogramdestinedfortopmedicalaccounts,designedto
helpgrowthebusiness.
Dermalogica(Dermalogica)isthethirdleadingbrandintheprofessionalsegmentwithsales
of$51million,downfrom$53millionduringtheprioryear.
Thebrandhasshownsalesdeclineoverthepastseveralyearsasaresultofthepoor
performance of the overall spas and salons channel and the loss of accounts due to
brandconsolidationindayspas.
FourthrankedSkinMedica(SkinMedica)showsthebiggestincreaseinsales,up18.6%from
The marketers various loyalty programs and growing sales force helps the brand to
collaboratecloserwithaccountsandstrengthenitspartnerships.
AdetailedoverviewofprofessionalbrandsisdiscussedinKline&CompanysProfessional
SkinCare:UnitedStatesreport.
4A42
FacialTreatments
Privatelabel
Privatelabel sales continue to grow in 2011, as a way for retailers to differentiate

themselvesfromtheircompetition.
Amongmassbrands,privatelabelfacialtreatmentsexperiencegrowthof5.8%during
2012.
To compete with nationally advertised brands, most major mass chain stores offer
privatelabelprogramsthatvarybyretailer.
The profit margin of privatelabel brands is higher than that of nationally advertised
brands,enablingtheretailertomakemoreprofiteventhoughprivatelabelbrandsare
usuallycheaper.
CVScontinuestohaveoneofthemostwellestablishedprivatelabelprogramsinthefacial
treatmentsarea.
These privatelabel products mimic the leading facial treatment brands in active
ingredientsandpackagingandsitadjacenttothesenationallyadvertisedbrandsonthe
shelf.
CVSinparticularoffersproductsthatarecomparabletothevarioussubbrandsofOlay,
LOral,Neutrogena,Aveeno,andRoC.
DrugstorecompetitorsWalgreensandRiteAiddonotoffertheextensiveprivatelabel
offeringsthatCVSprovides.
Not only are the major retailers increasing shelf space for privatelabel products, but
areofferingextraincentivesinpricingandpromotiontoencouragepurchase.
Specialty retailer Sephora offers the Sephora Collection as a standalone brand
including facial treatments since 2011, and Ulta adds facial treatment products to its
UltaSkincarelinein2012.
Another evolving trend is the establishment of exclusive, captive brands, and licensed
brands.
Insomecases,retailerscommissionexclusivebrandsdirectlyfromamanufacturer.
Sometimes a retailer seeks out an established foreign brand for exclusivity in the
UnitedStates.
Alternatively, some U.S. direct marketers look to make arrangements with other
channelsfordistributionexpansion.
Sometimesthearrangementisexclusivebychannel,wherebythebrandisexclusiveto
one retailer in the drug channel and to another retailer in the mass merchandiser
channel.
Since agreements between retailers and vendor are negotiated, it is possible that
exclusivityinachannelcouldalsoberestrictedtoaspecifiedperiodoftime.
4G43
4G44
FacialTreatments
RETAILDISTRIBUTION
Direct sales and specialty stores show slight increases in market share in the retailing of
facialtreatmentproducts.
Direct sales are driven by online sales from brickandmortar retailers, pure online
retailers,andalsoomeshoppingretailers.
Specialty retailer sales are driven by cosmetic specialty stores, such as Sephora and
Ulta.
Table4G21:ManufacturersSalesofFacialTreatmentsintheUnited
%Oftotal
Retailoutlet
2011
2012
Directsales
29
30
Departmentstores
25
25
Drugstores
16
16
Massmerchandisers
14
14
Specialtystores
Salonsandspas
Physicianoffices
Foodstores
100
100
Total
MARKETINGACTIVITY
Masspromotion
Print advertisements and coupons are the major means through which facial treatment
productsarepromotedtoconsumers.
Coupons typically consist of national $1.00 and $2.00off coupons as freestanding
inserts(FSIs)inweekendnewspapers.
Retailersalsopromotethebestsellingbrandsintheirweeklycirculars,sometimesto
match the availability of FSI coupons for the brand, offering greater savings to the
consumer.
Some brands and companies also offer rebates on the purchase of multiple products
fromtheirproductlineup.
Printadvertisementstypicallyappearinwomensfashionandservicepublications.
4A44
FacialTreatments
Mostmassmarketersnowutilizesocialmediatofurtherengagetheirconsumers.
MostmarketershaveaFacebookpage,andencourageconsumerstoselectlikeuson
Facebook,sothattheycanengageinadialogwiththebrandandotherpeoplewho
havelikedit.
Twitter is used by facial brands to rapidly share updated information on products,
launches,andcoupons.
Someofthecouponingactivitybyleadingmassmarketersincludesthefollowing:
Simplesave$2.00ononeSimpleproduct
RoCsave$3.00onanyRoCproduct
Aveenosave$2.00onanytwoAveenoproducts
Olaysave$5.00onanyProXregimen
Pondssave$1.00onanyPondscleansingproduct
ThemassfacialtreatmentbrandwiththelargestmeasuredtotalmediaexpendituresisOlay
at$125.3millionin2012,downfrom$197.3millionin2011.
OthermassfacialtreatmentbrandswithsizablemediaexpendituresincludeGarnierat
$34.6million,Aveenoat$27.6million,LOralParisat$25.0million,andNeutrogena
with$14.0million.
Massretailersplanspecialeventsandpromotions,sometimesinconjunctionwithproduct
companiestoencouragepurchase.
WalgreensoffersaninstoreeventseveraltimesayearcalledSaturDatewithBeauty,
where beauty advisors educate consumers with samples on products appropriate for
them.
In fall 2012, Target holds its first multicultural makeup and beauty event geared
specificallytotheneedsofethnicconsumers.
Luxurypromotion
Unchanged for decades, consumer promotion for luxury brands mainly consists of
advertising,sampling,giftwithpurchase(GWP),purchasewithpurchase(PWP)offers,and
instoreactivities.
Advertisingistypicallyinnationalfashionmagazines,suchasVogue,Glamour,andElle.
Luxurybrandsalsoplacegreatemphasisandfocusoninstorepromotions.Marketers
oftenpartnerwithkeyretailersforadvertisingeffortsorinstoreevents.
In addition to GWP and PWP promotions, free samples are sometimes given for
stoppingataluxurycounterinadepartmentstore,orwhenpurchasingonline.
Additionally,manyoftheluxurymarketerswhenpurchasingdirectly,alongwithluxury
retailersofferfreeshippingwithbeautypurchasesoveracertainamounttoencourage
sales.
4G45
4G46
FacialTreatments
Mostluxurymarketersnowutilizesocialmediatofurtherengagetheirconsumers.
Most marketers have Facebook pages, encouraging consumers to click like us on
Facebook,soastoengageinadialogwiththebrandandalsowithotherpeoplethat
havelikedthem.
Twitterisbeingusedbyfacialbrandstorapidlyshareupdatedinformationonproducts,
launches,andcoupons.
Clinique,theluxurysegmentsmarketleader,reliesprimarilyonGWPorPWPtopromote
itsbrand.
Makeup cases that are either generic or from a designer, such Tracy Reese or Trina
Turk,arecommonlyincludedaspartofCliniquesGWPorPWPpromotionsatleading
departmentstores.Insidethesemakeupcasesareanarrayofsomelongstandingand
somenewproductsfortheconsumertotry,typicallyofferedwithapurchaseof$28.00
ormore.
If purchasing directly from Cliniques website, the brand typically offers samples, or
evenatwoweeksupplyofaparticularproductwithacertainminimumpurchasemade.
Thewebsitealsohighlightsanyongoingofferoftheday.
Purchases through Cliniques website receive free shipping every day, no matter the
valueofthepurchase.
During2012,CliniqueoffersatwoweeksupplyofRepairwearLaserFocusatcounter
with no purchase necessary, to encourage trial. After a return consultation, another
twoweek supply is issued, so that the consumer will have four weeks to try out the
product.
CliniquemaintainstheInsidersClub,whichcustomerscanjoinafterenteringtheire
mail address on the brands website. The Insiders Club provides customers with an
insidescooponCliniquesproducts,freetreats,andotherinformationexclusiveonlyto
themembersoftheclub.
ForitsEsteLauderbrand,EsteLauderreliesprimarilyonGWPandPWPpromotions,and
alsohasawiderangeofotherpromotionalefforts.
EsteLauderoffersfreeshippingwithbeautypurchasesoveracertainamountas an
incentivetoencouragepurchase.
Este Lauder offers free samples of perfume, mascara, or facial product with every
onlineorder.
During 2012, Este Lauder holds a monthly sweepstakes in which the grand prize
winnerreceivesa$350.00shoppingvoucher.Consumersenterthepromotionbyfilling
outaformonthebrandswebsite,withnopurchaserequired.
4A46
FacialTreatments
LOrals leading luxury brand, Lancme, offers various incentives to encourage purchase,
withGWPandPWPasthemainpromotion.
Anypurchaseof$60.00ormoremadedirectlyfromLancmeswebsiteiseligiblefora
freegiftcomprisingamakeupcasealongwithseveralsamplesizeproducts.
Freeshippingisavailableonordersof$49.00ormore.
EmailsignupisavailableatLancmeswebsitetoreceiveemailsaboutnewproducts
andtrends.
ConsumerscancreateanaccountdirectlythroughLancmeswebsitethatwillentitle
the consumer to preview and shop for new products before its retail launch, receive
deluxesampleofferswhichareofalargersizethantheminisamplestypicallyprovided,
andalsosavetoaWishlist.
The brand offers various instore events in conjunction with major retail partners to
providepersonalizedconsultationsandintroducenewproducts.
The major luxury facial treatment marketers support their brands with advertising
campaignsinfashionandwomensservicepublications,alongwithtelevisionspots.
Luxury brands receiving the most advertising expenditures include Clinique at
$55.3million,EsteLauderwith$47.7million,andLancmewith$33.7million.
Directpromotion
Persontoperson direct marketers use company brochures, websites, and their sales
associatesforproductpromotion.
Salesforceincentiveprogramsaremostcommonlyused.
Other promotional efforts by direct marketers mainly include sampling and price
promotions.
Theleadingdirectmarketers,includingAvonandMaryKay,havetoolsontheirwebsitethat
allowaninterestedpartytofindasalesconsultantintheirarea.
MaryKayswebsitehasaPersonalBeautyProfilerthathelpsconsumersdecidewhich
facialtreatmentproductswouldbebestforthem.Thiswebsitealsoincludesthebrand
catalog,alinktoitsFacebookpage,aswellasaYouTubevideoaboutthebrandandits
products.
MostofMaryKayssalesassociateshavetheirownwebsitepage,tokeepintouchwith
theirconsumersviafrequentemails.
To help entice consumers, Mary Kays sales associates frequently hold product
demonstrationgatheringswhereparticipantsaregivenafreeproduct,suchasfullsize
lipglossoradollarcredittowardspurchasing.
4G47
4G48
FacialTreatments
Avonsignsonpopularcelebritiesforitsproductandcollectionlaunches,andfeaturesthese
celebritiesinitscatalogs.
Avon regularly promotes various products in its catalogs and on its website with
discountedprices.
While not part of themeasuredmediaexpenditures, Avons brochures are central to
thepromotionofthebrand,andserveinlieuofafulladvertisingcampaign.
SomeofAvonstraditionaladvertisinginthepasthasbeenmorerecruitmentoriented,
asawaytosecurenewsalesassociatesthanpromotingactualproducts.
AvonalsowidelypublicizesitsannualWalkforBreastCanceranditsprogramstofight
domesticviolence.
GuthyRenkercontinuestopromoteProactivthroughinfomercialsandadvertising.
Popularcelebrityspokesmodels,suchactressesKaleyCuoco,JulianneHaugh,andNaya
Riveraareusedintelevisionspots,digitalmedia,andpromotionsduring2012.
Free gifts are offered with the purchase of a Proactiv starter kit, and free shipping is
alwaysoffered.
The brand continues to run directresponse advertisements in FSIs of weekend
newspapersthroughoutthecountry,encouragingprospectivecustomerstoeithermail
inacouponorcalltopurchasetheProactivsystem.
TheProactivkiosksinmajormallsaroundthecountryalsocontinuetoevolvefroma
mannedkiosktoavendingmachine.
Measured advertising expenditures for Proactiv are $304.2 million during 2012, up
from$247.3millionduring2011.
OUTLOOK
The emphasis on looking good and keeping aging at bay will continue during the forecast
period,eveniftheUnitedStatesentersperiodsofeconomicuncertainty.
attributesinadditiontowrinklereductionandfirming,suchasbrightening,luminosity,
andradiance.
Facialtreatmentproductswillbeusedbothasasubstitutetocosmeticproceduresand
asanadjuncttothem,withthecommongoaloflookingasyoungaspossible.
Innovationbackedbysciencewillcontinuetobethemainimpetustogrowingthisproduct
category.
Consumerswillcontinuetotrythelatestproductsavailableinthehopeoffindingtheir
fountainofyouthinabottleorjar.
The use of multiple layers of products including serums, treatment products, and
moisturizerswillbecomethenormratherthananexception.
Products will target prevention and correction of common issues relative to facial
concerns.
Facial treatment marketers will work to offer benefits that claim to mimic those of
injectables,offermusclerelaxingproperties,suchasBotox,andplumpskinlikefillers,
suchasRestylaneandJuvederm.
4A48
FacialTreatments
Due to the success of BB creams from Asia, the United States will likely see an influx of
popularproductsfromotherareasoftheworld.
In late 2012 and early 2013, CC or color correction creams also from Asia begin to
appearontheU.S.market,andthereareexpectationsthatDDordailydefensecreams
mightalsoemergein2013and2014.
OilsfromnutsandtreesendemictovariousregionsinAfrica,arealsoexpectedtobe
usedmorecommonlyinthefuture.
TheFDAisexpectedtobemoreinvolvedinexaminingtheclaimsoffacialtreatmentbrands.
Severalbrands,suchasLancmehavealreadycomeunderscrutinyforsomeoftheir
claims,anditisexpectedthattheFDAwillprovidemoreoversightinthisareaduring
theforecastperiod.
Beforeandaftervisualstodemonstratetheresultsthatmaybeobtainedwiththeuse
of a products will be more readily available on the companys literature, with
disclaimersthatresultsmaynotbetypical.
More natural ingredients are likely to be used in facial treatment products during the
forecastperiod.
Fromoilstoplants,toingredientsfromthesea,thesenaturalingredientswillformthe
coreoffacialtreatmentproducts.
Stem cells from fruits and plants will likely increase in popularity in facial treatment
products.
Elimination of unnecessary ingredients and extra packaging will occur as facial
treatmentmarketersaimtobemoreenvironmentallyfriendly.
Marketerswillcontinuetolookbeyondtheircorechannelofdistributionforsales.
Drug chains and massmerchandisers willcontinue to look for higherend brandsand
willlikelyfindwillingparticipants.
Retailers, such as Sephora and Ulta will continue to court luxury department store
brands get them to test expanding their channel of distributionHome shopping
channelsandtheInternetareexpectedtoincreaseinpopularitywithluxurybrands.
Luxuryfacialtreatmentproductsareexpectedtoexhibitthemostgrowthoverthenextfive
yearsandareexpectedtobecomethelargesttradeclass.Moreconsumerswillbewillingto
tradeuptowhattheyperceiveasbetterproducts.
This trade class is expected to grow at a CAGR of 8.8%, compared to the category
averageof5.0%.
Antiagingwillcontinuetobethemajorpowerofthetradeclass,andtheuseofbetter
ingredientswilldriveuppricepoints.
Consumerswillviewthepurchasingoffacialtreatmentproductsasaninvestment,and
willbeenthusiastictoinvestintheseproductsprovidedthattheyseeresults.
4G49
4G50
FacialTreatments
Massfacialtreatmentproductswillcontinuetoaccountforthesecondlargesttradeclass.
The mass trade class is expected to grow at a CAGR of 6.0%, which is ahead of the
Antiagingwillcontinuetobethemajorthemeofnewproducts.
Pricesofmassbrandswilllikelyincrease,duetomoretechnicallyadvancedingredients,
puttinghighendmassbrandsnotfarbehindthecostofentrylevelluxurybrands.
Mass retailers will continue to offer privatelabel brands that mimic the bestselling
nationallyadvertisedones,duetotheirattractivemargins.
Additionally, mass retailers will continue to seek out exclusive brands that are not
foundinallretailers,tohelppositionthemselvesasdestinations.Onesuchexampleis
WalgreenswhichinvestsinproductsfromAllianceBoots,suchastheBootsNo.7line
during2012.
ThedirecttradeclasswilllikelysufferthelargestdeclineataprojectedCAGRof2.0%.
Thistradeclasswillcontinuetoexperiencedecliningsalesduetochallengesfromboth,
AvonandMaryKaytorecruitandmaintaingoodqualitysalesassociates.
It is expected that infomercial marketer GuthyRenker will explore the selling of its
products in channels other than infomercials due to the increasing production costs
associatedwithitscurrentmodel.
Facial treatments are expected to grow at a CAGR of 5.0% over the forecast period,
reaching$8,482millionby2017.
Moisturizers/treatmentswillshowthemostgrowth,ataforecastCAGRof5.4%.
Fadecreamsandwhiteningproductswillexperienceslightdeclinesduringtheforecast
period as benefits offered by these products are increasingly being included in
moisturizerandtreatmentproducts.
The prevalence of acne treatments along with unique facial cleansers that allow for
betterabsorptionofmoisturizersandtreatmentproducts,willkeepthesetwoproduct
typesgrowingatthecategorysaverageof5.0%
Table4G22:ForecastManufacturersSalesofFacialTreatmentsintheUnited
StatesbyProductType,2012and2017
$Million
Producttype
2012
2017
CAGR,%
Moisturizers/treatments
3,724
4,834
5.4
Cleansers
1,935
2486
5.0
Acneaids
642
819
5.0
Astringents/toners
127
127
Whiteningproducts
99
98
(0.2)
Makeupremovers
99
99
Fadecreams
20
19
(1.0)
6,645
8,482
5.0
Total
4A50
FacialTreatments
Table4G23:ForecastManufacturersSalesofFacialTreatmentsinthe
UnitedStatesbyTradeClass,2012and2017
$Million
Tradeclass
2012
2017
CAGR,%
Mass
2,248
3,008
6.0
Luxury
2,120
3,232
8.8
Direct
1,482
1,340
(2.0)
699
810
3.0
97
92
(1.0)
6,645
8,482
5.0
Professional
Specialty
Total
Unit volume is forecast to grow at a CAGR of 4.2% over the forecast period, reaching
823millionpackagesby2017,upfrom670millionpackagesin2012.
4G51
4G52
FacialTreatments
4A52
HANDANDBODYLOTIONS
CATEGORYPERFORMANCE
Manufacturerssales
Salesofhandandbodylotionsatthemanufacturerslevelgrow1.9%to$2,283millionin
Salesinthehandandbodylotionscategoryhavegrownatacompoundannualgrowthrate
(CAGR)of1.1%from$2,160millionin2007to$2,283millionin2012.
Table4G24:HistoricalSalesofHandandBodyLotionsin
Year
$Millionr
Change,%
2007
2,160
2008
2,172
0.6
2009
2,192
0.9
2010
2,208
0.7
2011
2,240
1.4
2012
2,283
1.9
rRestated.
Unitsales
Unit sales of hand and body lotions advance 1.6% to 514.2million packages in 2012, up
Retailsales
Retail sales of hand and body lotions total $3,389 million in 2012, up 1.8% from
4G54
HandandBodyLotions
Table4G25:ManufacturersSalesofHandandBodyLotionsintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
2011
HANDANDBODYLOTIONS
Mass
%Oftradeclass
2012
2011
%Oftotal
2012
2011
2012
Jergensr
Kao
149
162
12.0
12.8
6.7
7.1
Aveenor
Johnson&Johnson
112
120
9.1
9.5
5.0
5.3
VaselineIntensiveCare
Unilever
114
108
9.2
8.6
5.1
4.7
Nivear
Beiersdorf
94
94
7.6
7.5
4.2
4.1
Eucerinr
Beiersdorf
82
85
6.6
6.7
3.7
3.7
GoldBond
Sanofi
63
64
5.1
5.1
2.8
2.8
Lubridermr
Johnson&Johnson
60
63
4.9
5.0
2.7
2.8
Cetaphilr
53
54
4.3
4.3
2.4
2.4
Suaver
Unilever
54
52
4.4
4.1
2.4
2.3
Palmer'sr
E.T.Browne
44
48
3.6
3.8
2.0
2.1
Curelr
Kao
47
46
3.8
3.6
2.1
2.0
St.Ives
Unilever
32
32
2.6
2.5
1.4
1.4
Burt'sBees
TheCloroxCompany
29
30
2.3
2.4
1.3
1.3
Neutrogena
Johnson&Johnson
26
25
2.1
2.0
1.2
1.1
Aquaphor
Beiersdorf
21
22
1.7
1.7
0.9
1.0
Olay
Procter&Gamble
22
20
1.8
1.6
1.0
0.9
Johnson's
Johnson&Johnson
0.7
0.7
0.4
0.4
Keri
Novartis
0.6
0.6
0.4
0.4
AvalonOrganics
TheHainCelestialGroup
0.6
0.6
0.3
0.3
Dove
Unilever
0.6
0.5
0.3
0.3
Sebamed
PhysicianLaboratories
0.3
0.3
0.2
0.2
JasonNaturalProducts
TheHainCelestialGroup
0.3
0.3
0.2
0.2
DirtyGirl/BlueQ
BlueQ
0.2
0.2
0.1
0.1
L'Oral
L'Oral
0.2
0.2
0.1
0.1
FruitoftheEarthr
FruitoftheEarth
0.1
0.1
TheHealingGarden
IlexCapitalGroup
0.1
0.1
EOS
EOSProducts
0.1
0.1
Privatelabelr
109
109
8.8
8.6
4.9
4.8
Allotherr
78
82
6.3
6.5
3.5
3.6
1,237
1,261
100.0
100.0
55.2
55.2
Totalr
Specialty
Bath&BodyWorks
LimitedBrands
409
425
66.8
67.0
18.3
18.6
Victoria'sSecretGarden
LimitedBrands
102
105
16.7
16.6
4.6
4.6
TheBodyShop
L'Oral
33
34
5.4
5.4
1.5
1.5
L'Occitane
L'Occitane
13
13
2.1
2.1
0.6
0.6
CamilleBeckman
CamilleBeckman
10
10
1.6
1.6
0.4
0.4
Crabtree&Evelyn
Crabtree&Evelyn
1.0
1.1
0.3
0.3
CaswellMassey
CaswellMassey
0.7
0.8
0.2
0.2
Allother
Total
35
35
5.7
5.5
1.6
1.5
612
634
100.0
100.0
27.3
27.8
(Continued)
4A54
4G55
HandandBodyLotions
Table4G25:ManufacturersSalesofHandandBodyLotionsintheUnitedStatesbyTradeClassandBrand,2011and2012
$Million
Tradeclass/brand
Company
2011
HANDANDBODYLOTIONS(Continued)
%Oftradeclass
2012
2011
%Oftotal
2012
2011
2012
Direct
MaryKay
MaryKay
93
95
39.9
41.5
4.2
4.2
Avon
Avon
75
70
32.2
30.6
3.3
3.1
Arbonne
Arbonne
35
35
15.0
15.3
1.6
1.5
Mark
Avon
2.6
2.2
0.3
0.2
Allother
Total
24
24
10.3
10.5
1.1
1.1
233
229
100.0
100.0
10.4
10.0
Luxury
Philosophy
Coty
10
11
13.7
14.9
0.4
0.5
Origins
EsteLauder
10
10
13.7
13.5
0.4
0.4
Clinique
EsteLauder
11.0
10.8
0.4
0.4
Bliss
SteinerLeisure
11.0
10.8
0.4
0.4
Clarins
Clarins
4.1
4.1
0.1
0.1
EsteLauder
EsteLauder
4.1
4.1
0.1
0.1
BeneFit
LVMH
4.1
2.7
0.1
0.1
Chanel
Chanel
2.7
2.7
0.1
0.1
ElizabethArden
ElizabethArden
2.7
2.7
0.1
0.1
Lancme
L'Oral
2.7
2.7
0.1
0.1
Shiseido
Shiseido
Allother
Total
2.7
2.7
0.1
0.1
20
21
27.4
28.4
0.9
0.9
73
74
100.0
100.0
3.3
3.2
20.8
20.8
0.2
0.2
19
19
79.2
79.2
0.8
0.8
24
24
100.0
100.0
1.1
1.1
16
16
38.1
38.1
0.7
0.7
7.1
7.1
0.1
0.1
Professional
Aveda
EsteLauder
Allother
Total
FOOTCAREPRODUCTS
Mass
Dr.Scholl's
Merck
FreemanBareFoot
FreemanBeauty
JohnsonsOdorEaters
Blistex
7.1
4.8
0.1
0.1
GoldBond
Sanofi
4.8
4.8
0.1
0.1
SallyHansen
Coty
2.4
2.4
0.0
0.0
17
18
40.5
42.9
0.8
0.8
42
42
100.0
100.0
1.9
1.8
11
12
100.0
100.0
0.5
0.5
2,240
2,283
Allother
Total
Specialty
Bath&BodyWorks
Direct
Footworks
TOTAL
LimitedBrands
Avon
100.0
rRestated.
100.0
0.4
0.3
100.0
100.0
4G56
HandandBodyLotions
CATEGORYDEVELOPMENT
Markettrends
Naturalandorganicproductscontinuetoprosper,drivingthecategorysgrowthin2012.
Marketers, such as Johnson & Johnson, Kao, and The Clorox Company increasingly
introduce naturallyinspired hand and body lotion variants infused with different
naturalingredients,asthedemandforsuchproductsincreases.
In comparison to the conventional mass products, natural products demand higher
prices, which many consumers are willing to pay, thereby driving sales growth in the
category.
Mostofthenaturalproductofferingsinthecategoryarenaturallyinspiredandcontain
lowerproportionofsyntheticchemicalsincomparisontotheconventionalproductsin
thecategory.However,mosthandandbodylotionsarenottrulynatural.
A few naturallypositioned hand and body lotions available in the market include St.
IvessNaturallyIndulgentAdvancedBodyMoisturizers,AveenosPositivelyNourishing
Calming Body Lotion, Jergens Soothing Aloe Refreshing Moisturizer, and Burts Bees
NaturallyNourishingMilk&HoneyBodyLotion.
In 2012, Sensible Organics introduces the Nourish Organic Body Butter and Nourish
Organic Body Lotion and E. T Browne introduces the Palmers Cocoa Butter Formula
DailyCalmingLotionandPalmersCocoaButterFormulaHydratingGelLotion.
Mosthandandbodylotionsinthecategoryareinfusedwithcommonlyusednatural
ingredients, such as milk, honey, shea butter, cocoa butter, aloe, oatmeal, jojoba oil,
coconutoil,cucumber,vitaminA,andvitaminE.
Handandbodylotionsofferingtherapeuticbenefitscontributetothecategoryssales.
Products claiming to provide moisturizing and nourishing benefits continue to gain
acceptanceinthemarket.
Consumersincreasinglybuyhandandbodylotionsthatoffernourishing,hydrating,and
moisturizingproperties.
NiveasExtendedMoistureLotionenrichedwithProVitaminB5providesrelieftodry
skinforupto48hours.
Johnson&JohnsonsNeutrogenaMoistureWrapLotionclaimstomoisturizetheskin
deeply,andproviderelievefromdry,dull,andflakyskin.
Curelclaimsthatitslineofhandandbodylotionstobedermatologistrecommended
and formulated to moisturize and heal dry skin. Curels line of body lotions includes
nineSKUs.
Cetaphils Restoraderm Skin Restoring Moisturizer rebuilds the skins moisture,
replenishestheskinsnaturallipids,andsoothesdry,itching,andirritatedskin.
In2012,KaointroducestheJergensCremaDeepConditioningOatmeal,JergensCrema
SoothingAloeVera,andJergensCremaHydratingCoconutMilk.
Handandbodylotionsenrichedwithsunprotectionfactor(SPF)isanotherrisingtrend
in the market, with many consumers opting for multifunctional products providing a
varietyofbenefits.
SomeofthehandandbodylotionsofferingSPFbenefitsincludeJergensNaturalGlow
and Protect Daily Moisturizer with SPF 20, Eucerins Daily Protection SPF 15
MoisturizingBodyLotion,LubridermsDailyMoistureLotionwithBroadSpectrumSPF
15,PalmersCocoaButterFormulaSPF15BodyLotion,andVaselinesAloeFreshBody
LotionwithSPF15.
4A56
HandandBodyLotions
Handandbodylotionsenrichedwithantiagingbenefitscontinuestobeaprominenttrend.
Marketers focus on the development of hand and body lotions, enriching them with
antiagingproperties,asthebabyboomerpopulationintheUnitedStatesincreases.
Hand and body lotions equipped with antiaging benefits that help reduce the
appearanceofaging,andfirmsandupliftstheskintokeeptheskinlookingyoungand
tight,gainprominenceinthemarket.
Jergens Natural Glow and Firming Daily Moisturizer not only provide a gradual
darkeningofskincolorbutalsofirmerskinwithimprovedskinelasticity,andnotably
reducedappearanceofcellulite.
Beiersdorfs Nivea Skin Firming Body Lotion with Q10 Plus is formulated with Co
enzyme Q10 Complex to firm and tighten skin. The company claims that results are
visibleinaslittleastwoweeks.
E.T. Browne asserts that its Palmers Cocoa Butter Formula Massage Lotion infused
withablendofcocoabutter,vitaminE,sheaButter,andBioCElaste,helpsreducethe
appearanceofstretchmarks.
Aveeno claims its Positively Ageless Skin Strengthening Hand Cream, enriched with
activenaturalssouthernwood,givesstronger,moreresilient,andyoungerlookingskin.
DovesProAgeCreamOilBodyLotionisamultifunctionalproductofferingthebenefits
ofenhancedcellturnover,hydration,andsunprotection,allinoneproduct.
Theavailabilityofhandandbodylotionsina variety of exotic fragrances is a significantly

growingtrend.
Marketersareincreasinglyintroducinghandandbodylotionsinanarrayoffragrances
toappealtoawidersectionofconsumersandalsoexpandtheirproductportfolio.
AvalonOrganicshandandbodylotionsareavailableinOlive&GrapeSeed,Grapefruit
&Geranium,Lavender,Lemon,Peppermint,Rosemary,andYlangYlangvariants.
SuaveNaturalsoffershandandbodylotionsinWildCherryBlossom,LavenderVanilla,
MangoMandarin,SweetPea&Violet,andEverlastingSunshinealternatives.
However,marketershavenowalsobeguntointroducefragrancefreeformulations.
AfewofthefragrancefreehandandbodylotionsavailableinthemarketareCurels
Intensive Healing Cream Daily FragranceFree Cream and Mary Kays FragranceFree
SatinHandsCream.
In2012,KaointroducestheJergensDailyMoistureFragranceFreeDrySkinLotion.
4G57
4G58
HandandBodyLotions
Seasonalitydeterminesthedemandforthetypeofhandandbodylotions.
During winters, consumers choose to use hand and body lotions enriched with
ingredientsofferingextramoisturizingandhydratingbenefitssoastoprovidereliefto
extra dry skin while during summers consumers use hand and body lotions with a
lightweightfeelandofferingagradualtannedlook.
Some of the commonly used hand and body lotions during winters include Jergens
CremaDeepConditioningOatmealandEucerinsIntensiveRepairVeryDrySkinLotion,
whilethehandandbodylotionsfavoredinsummersincludeEucerinsProtectionSPF
15MoisturizingBodyLotion,Crabtree&EvelynsTaroccoOrange,Eucalyptus&Sages
Skin Refreshing Body Lotion, and Bath & Body Works Wild Citrus Sunflower Body
Lotion.
Also,handandbodylotionsavailableingelformatsareincreasinglypopular,withafew
variants available in the market including Palmers new Cocoa Butter Formula
Hydrating Gel Lotion, Niveas Express Hydrating Gel, and Vaselines Aloe Fresh
HydratingBodyGel.
Salesofprivatelabelproductsremainstablein2012.
Privatelabel hand and body lotions are associated with decent quality products
providingefficaciousresults.
Also,privatelabelproductsaresupportedbyanaggressivepushfromretailers,suchas
Walmart, Walgreens, and Target, who are allocating good amount of shelf space at
strategiclocationsforeasyvisibilitytoconsumers.
Manyconsumerswhohadtradeddowntoprivatelabelproductsduringtherecession,
continue to use them in spite of the economic recovery. This is due to their past
experienceofprivatelabelproductsprovidingthemresultssimilartothoseofnational
brandsatamuchlowerprice.
Privatelabel products offer more value for money with a difference of 30.0%35.0%
betweentheirpricesandthoseofnationalmassbrands.
Foot care products continue to remain a niche segment in the hand and body lotions
categorywithsalesin2012stagnantat$61million,flatfrom2011.
Footcareproductsaccountfor2.7%ofthecategoryssalesin2012.
Mercks Dr.Scholls retains its lead in the segment, with sales at $16million in 2012,
samefrom2011levels.
Sales in the segment remain stagnant due to a lack of new product activity and
innovation. Moreover, limited number of marketers compete in the segment with
limitedproductofferings.
A few variants available in this segment include Curels Foot Therapy Cream and
PalmersCocoaButterFormulaFootMagic.
Additionally,thenegligibletraceablemediaexpenditures(TME)allocatedbymarketers
forthesegmenthasadverseeffectonthecategoryssales.
4A58
HandandBodyLotions
Notablenewproducts
Table4G26:SelectNewHandandBodyLotionsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Beiersdorf
Eucerin
ProfessionalRepairExtremelyDrySkinLotionisinfusedwithceramide3andglucoglycerol,retain
moisture,andpreventsfurtherdryness
TheCloroxCompany
BurtsBees
UltimateCareHandCreamisclinicallyproventomoisturizeextremelydryskin.Theformulaisenriched
withbaobaboil,watermelonseedoil,andnaturalfruitacidcomplex
TheCloroxCompany
BurtsBees
UltimateCareBodyLotionisclinicallyproventoleavedryskinmoisturized,nourished,and
conditioned.Itcontainspumpkinseedoilandgreenteaextracts
TheCloroxCompany
Gd
RedRubyGroovyNaturalBodyLotionsoftensskin,hasnoparabens,phthalatesorpetrochemicalsand,
hasthescentofgrapefruitandwildthyme
TheCloroxCompany
Gd
PearanormalActivityNaturalBodyLotionsoftensskinheadtotoe,hasnoparabens,phthalates,or
petrochemicals,hasascentofpearandacaiberry,andisenrichedwithsheabutter
TheCloroxCompany
Gd
OrangePetaloozaNaturalBodyLotionisenrichedwithsheabutterthathydratestheskinandgets
absorbedquickly,hasnoparabens,phthalates,orpetrochemicals,hasascentofbloodorangeand
hyacinthleaves
TheCloroxCompany
Gd
FloralCherrynovaNaturalBodyLotionprovidesnourishmenttotheskin,hasnoparabens,phthalates,
orpetrochemicals,hasascentofcherryblossomsandalmondmilk
TheCloroxCompany
Gd
VanillaFlameNaturalBodyLotionprovidesmoisturizingpropertiestotheskin,hasnoparabens,
phthalates,orpetrochemicals,hasascentofvanillaandricemilk
E.TBrowne
Palmers
CocoaButterFormulaDailyCalmingLotionwithablendofcocoabutter,glycerin,urea,soy,andoat
providesrelieftoirritatedskin,helpsretainmoisture,exfoliatesdryandflakypatches,andchamomile
andlavenderextractsprovidesoothingbenefits
E.TBrowne
Palmers
CocoaButterFormulaHydratingGelLotionisalightweightmoisturizerintheformofgel,infusedwith
cocoabutter,vitaminE,aloe,andcucumberextract
Kao
Jergens
NaturalGlowandProtectisabodymoisturizer,providesUVA/UVBprotection(SPF20),availablefor
twoskintones:fairtomedium,andmediumtotan.
Kao
Jergens
DailyMoistureDrySkinLotionisanodorlessdailymoisturizer,thatrevitalizesskinwithmoisturizer,
antioxidant,andvitaminE.Itisavailablefortwoskintones:fairtomedium,andmediumtotan
Kao
Jergens
CremaDeepConditioningOatmealBodyMoisturizer,containsoatmealformulathatprovideshealing
andsoothingpropertiestoreplenishtheskin
Kao
Jergens
CremaSoothingAloeVeraBodyMoisturizer,enrichedwithaloevera,vitaminEandB5
Kao
Jergens
CremaHydratingCoconutMilkBodyMoisturizer,lightweightformulawithcoconutmilk
LimitedBrands
Victorias
Secret
SecretBombshellItalianIrisBodyLotionisalimitededitionbodylotionfromtheCiaoBellafragrance
collectionwithtopnotesofItalianiris,whitepoppy,andorris
LimitedBrands
Victorias
Secret
VerySexyItalianMandarinBodyLotionisalimitededitionbodylotionfromtheCiaoBellafragrance
collectionwithtopnotesofItalianmandarin,bergamot,andcoconutmilk
LimitedBrands
Victorias
Secret
VSFantasiesDeepsofteningBodyButterisarestorativebodybutterenrichedwithsheabutter,cocoa
butter,andvitaminE.Itisavailableinthreevariant:LusciousCrush,CitrusDream,andLemonEscape
LimitedBrands
Victorias
Secret
VSFantasiesUltramoisturizingHandandBodyCreamisanintensivehandandbodycreamenriched
withavocadoandsweetalmondoilsandhoneyfora24hourmoisturizingexperience.Itisavailablein
threevariant:LusciousCrush,CitrusDream,andLemonEscape
LimitedBrands
Victorias
Secret
VSFantasiesHydratingBodyLotionisafastabsorbingbodylotionenrichedwithextractsofaloe,oat,
andgrapeseedandvitaminEandC.Itisavailableinthreevariant:LusciousCrush,CitrusDream,and
LemonEscape
LimitedBrands
Victorias
Secret
ItalianBergamotBodyLotionisalimitededitionbodylotionfromtheCiaoBellafragrancecollection
withtopnotesofItalianbergamot,waterbreeze,andspringdaffodils
SensibleOrganics
Nourish
Organic
NourishOrganicBodyButterisenrichedwithsheabutter,coconutoil,oliveoil,vitaminE,and
antioxidants,andminimizessignsofaging
SensibleOrganics
Nourish
Organic
NourishOrganicBodyLotionisenrichedwithaloe,proteins,acai,essentialoils,andvitaminE,claimsto
improveskinelasticity
TheCloroxCompany
BurtsBees
IntenseHydrationDayLotionisanoncomedogenicdaylotionthathydratesdryskinandhelpsreduce
finelinesandwrinkles.Itisinfusedwithclarysage
Valeant
Pharmaceuticals
CeraVe
SARenewingLotionislightweight,fragrancefreebodymoisturizerthathydratesskin.Itisenriched
withnaturalingredients,suchasglycerin,mineraloil,ceramides,andvitaminD.
4G59
4G60
HandandBodyLotions
COMPETITION
Bycompany
Table4G27:ManufacturersSalesofHandandBodyLotionsintheUnitedStatesby
Company,2011and2012
$Million
2011
2012
2011
2012
LimitedBrands
522
542
23.3
23.7
Johnson&Johnsonr
207
217
9.2
9.5
Kaor
196
208
8.8
9.1
Beiersdorfr
197
201
8.8
8.8
Unileverr
207
198
9.2
8.7
MaryKay
93
95
4.2
4.2
Avon
89
82
4.0
3.6
Sanofi
65
66
2.9
2.9
GaldermaLaboratoriesr
53
54
2.4
2.4
E.T.Browner
44
48
2.0
2.1
LOral
38
38
1.7
1.7
Arbonne
35
35
1.6
1.5
TheCloroxCompany
29
30
1.3
1.3
EsteLauder
26
26
1.2
1.1
Procter&Gamble
22
20
1.0
0.9
Merck
16
16
0.7
0.7
Privatelabelr
109
109
4.9
4.8
Allotherr
292
298
13.0
13.1
2,240
2,283
100.0
100.0
4A60
%Oftotal
Company
Totalr
rRestated.
HandandBodyLotions
LimitedBrandsistheleadingcompanyinthehandandbodylotionscategorywitha3.8%
growthin2012.
Sales grow from $522 million in 2011 to $542 million in 2012 supported by new
productintroductionsandpackagingchangestoitsexitinglineofproducts.
LimitedBrandsrepresents23.7%shareofthetotalcategoryssalesin2012,upfroma
23.3%shareoftotalcategoryssalesin2011.
ThecompanyisrepresentedbyBath&BodyWorksandVictoriasSecretbrandsinthe
category.
Bath&BodyWorkssalesadvance4.0%from$420millionin2011to$437millionin
2012.
Bath & Body Works product offerings in the category include body lotions, body
creams,bodybutters,footlotionsandcreams,andhandlotionsandcreams.
company.
Other popular product ranges for the brand include Forever Red, Paris Amour, and
CashmereGlow.
The Forever Red product line is a premium line and therefore is retailed at a higher
price.
Woods line of products comprising a body lotion, moisture body cream, and body
butter and; Brown Sugar & Fig line of products comprising a body Lotion and a
moisturebodycream.
As a part of its 2012 Holiday Traditions, the brand introduces the Vanilla Bean Noel
LotionandFrostedSnowberryBodyLotionforalimitedtimeperiod.
VictoriasSecretssalesadvance2.9%from$102millionin2011to$105millionin2012.
In2012,VictoriasSecretintroduceslimitededitionoftheSecretBombshellItalianIris
BodyLotion,ItalianBergamotBodyLotion,andVerySexyItalianMandarinLotion.Also
new to 2012 are a number of Victorias Secrets Fantasies variants with exotic
fragrances.In2012,thePinklineofbodylotionsandbodybuttersundergoapackaging
changetogivethelineofproductsamorelivelyandfreshlook.
4G61
4G62
HandandBodyLotions
Johnson&Johnsonisthesecondlargestmarketerinthehandandbodylotionscategory,
withsalesat$217millionin2012.
Salesgrow4.8%from$207millionin2011.
Johnson&Johnsonsmarketsharegrowsfrom9.2%in2011to9.5%in2012.
The marketer competes in the category with its Aveeno, Neutrogena, Lubriderm,
Johnsons,andRoCbrands.
Aveenoisthelargestbrandforthemarketerinthecategorywithsalesat$120million
in2012,up7.1%from$112millionin2011.Aveenosnaturalpositioninginthemarket
istheprimaryreasonbehindthebrandsgrowthasmoreconsumerschoosenaturally
positionedhandandbodylotionsovertheconventionalhandandbodylotions.
Aveenorepresents55.3%ofthemarketerstotalsalesinthecategoryin2012.
Thebrandclaimstoenrichitsproductformulationswithactivenaturalingredients.
Some of the commonly found natural ingredients in Aveenos hand and body lotions
include blueberry, goji berries, grapefruit, rosemary, vanilla, cocoa butter, and shea
butter.
The marketers secondlargest brand in the category is Lubriderm, with sales at
$63millionin2012,up5.0%from$60millionin2011.Thegrowthin2012isdrivenby
theformulationchangesthatthemarketerintroducestoitsLubridermlineinlate2011,
effectsofwhichbecomeprominentinits2012sales.
The brand represents a 29.0% share in Johnson & Johnsons hand and body lotions
salesinthecategory.
Lubridermpositionsitselfasadermatologistdevelopedbrandwithfourproductlines:
DailyMoisture,AdvancedTherapy,IntenseSkinRepair,andSoothingRelief.
Sales of Johnson & Johnsons thirdleading brand, Neutrogena, decline 3.8% from
$26millionin2011to$25millionin2012.Neutrogenassalesdeclineasaresultofthe
lack of new and innovative product activity from the brand in the category in 2012.
Additionally,thebrandsofferingsinthecategoryareverylimitedincomparisontothe
other brands offerings. The more successful competitors continuously evolve their
brandsandoffernewandinnovativeproductswithadditionalbenefitsandfragrances
tokeepconsumersengaged.
As a result of the sales decline in 2012, Neutrogenas share in Johnson & Johnsons
sales in the hand and body lotions category decline from 12.6% in 2011 to 11.5% in
2012.
4A62
HandandBodyLotions
Kaocontinuestobethethirdleadingmarketerinthecategorywithsalesat$208millionin
2012.
Salesgrow6.1%from$196million2011.
Kaosmarketshareinthehandandbodylotionscategoryadvancesfrom8.8%ofthe
totalcategoryssalesin2011,to9.1%ofthetotalcategoryssalesin2012.
KaoisrepresentedinthecategorywithitsJergensandCurelbrands.
Jergensisthelargestmassbrandinthehandandbodylotionscategory,accountingfor
7.1%ofthetotalcategoryssalesin2012,upfrom6.7%in2011.
Salesforthebrandadvance8.7%from$149millionin2011to$162millionin2012.
The good performance of the newlyintroduced Jergens Crema line comprising three
variants: Crema DeepConditioning Oatmeal Body Lotion, Crema Soothing Aloe Vera
BodyLotion,andCremaHydratingCoconutMilkaidsinthebrandsgrowth.
JergenslineofproductsinthehandandbodylotionscategorycomprisesNaturalGlow,
DailyMoisturizers,andCrema.
Alsoin2012,themarketerchangesthepackagingofitsNaturalGlowlineofproducts
withnewproductintroductions,includingtheNaturalGlowandProtectandtheDaily
Moisture Dry Skin Lotion, each including two variants for different skin tones: fair to
mediumandmediumtotan.
SalesofCureldeclinein2012to$46million,down2.1%from$47millionin2011.
Inadditiontobodylotions,Curelalsooffershandandfootcareproductsintheformof
Hand&CuticleTherapyandFootTherapy,respectively.
Beiersdorfisthefourthleadingmarketerinthehandandbodylotionscategorywithsales
reaching$201millionin2012.
Manufacturerssalesadvance2.0%to$210millionin2012,from$196millionin2011.
BeiersdorfispresentinthecategorywithitsNivea,Eucerin,andAquaphorbrands.
Niveaistheleadingbrandforthemarketerinthehandandbodylotionscategorywith
Niveas product offerings include lotions, hand creams, and gels/serums with a wide
selectionofproductsforthelotionssegment.
EucerinisthenextbiggestbrandforBeiersdorfinthecategory,postinga3.7%growth
toreach$85millionin2012from$82millionin2011.
In 2012, Eucerin undergoes packaging changes for its hand and body lotions by
streamlining the design for each product. A texture scale design is added to the
packagingthatshowsiftheproductisrich,lightweight,orfallsbetweenthetwo.
Additionally,theproductnamesarechangedtomakeiteasierforconsumerstoclearly
identifywhattheproducthastooffer.Thisproductnamechangeismadefor11SKUs
inthehandandbodylotionscategory.
SalesofAquaphorincreaseto$22millionin2012,up4.8%from$21millionin2011.
4G63
4G64
HandandBodyLotions
Unileveristhefifthleadingmarketerinthecategorywithdecliningsalesin2012.
Thecompanyssalesdecline4.3%from$207millionin2011to$198millionin2012.
ThemarketerisrepresentedinthecategorywithitsVaseline,Suave,Dove,andSt.Ives
brands.
Unileveraccountsfor8.7%shareofthetotalcategoryssalesin2012,downfrom9.2%
in2011.
Sales of Vaseline continue to declines in 2012 with sales at $108 million, down 5.3%
VaselineisbackedbyTMEof$41millionin2012,upfrom$28.4millionin2011.The
VaselineIntensiveMoisturelineisthemostadvertisedrangeofproductsforthebrand
with a TME allocation of approximately $20 million in 2012. However, the lack of
freshness in its product portfolio, negligible innovation, and increasing competition
fromotherbrandsresultinsalesdeclineforVaselinein2012.
Suaveisthesecondleadingbrandforthemarketerin2012withsalesat$52million,
down3.7%from$54millionin2011.Despitetheextensionofitshandandbodylotions
lineofproducts,thebrandisnotabletopostgrowthin2012.
SuaveintroducestheEverlastingSunshinefragrancetoitsalreadyexistingbodylotion
productlinein2012.
SalesofSt.Ivesremainstagnantat$32millionin2012,from2011levels.
SalesofDovecontinuetodeclineat14.3%from$7millionin2011to$6millionin2012.
AdeclineinsalesofDoveisduetonegligiblenewproductactivityandnoinnovations
orformulationchangesforthebrandin2012.
Dovehasalimitedpenetrationinthecategorywithonlyfourproducts.
Privatelabel
In 2012, manufacturers sales of privatelabel products remain stagnant at $109 million

from2011levels.
Themarketshareofprivatelabeldeclinesto4.8%ofthecategoryssalesin2012from
4.9% in 2011, although the overall categorys sales grow. The recovering economy
allowsconsumerstoshiftbacktonationalbrands,therebyrestrictingsalesgrowthof
privatelabelproductsin2012.
However,privatelabelproductsreceivesupportfromretailersduetothehighmargin
ofprofitsearnedbythemascomparedtothosefromwellestablishednationalbrands.
Few privatelabel products available in the market include Walgreens Cocoa Butter,
Walgreens Intensive Healing Moisturizing Lotion, CVS Healthy Hands Hand and Nail
Care Lotion, CVS Fragrance Free Lotion Advanced Healing, and Sephoras Collection
HeadtoToeHydrator.
Massmerchandiserscontinuallyexpandtheirexistingproductlineswithhandandbody
lotions offering advanced benefits, such as antiaging, sun care, and therapeutic
benefits.
SomeofthealreadyavailableproductsinthemarketincludeCVSHealingSkinTherapy
Lotion, Rite Aids Renewal Daily Moisturizer Positively Glowing with SPF 15, and
WalgreensMoistureRecoveryLotionFragranceFree.
4A64
HandandBodyLotions
RETAILDISTRIBUTION
Specialty stores continue to be the largest retail distribution outlet in the hand and body
lotions category, representing 33% of the total categorys sales in 2012, flat from 2011
levels.
Massmerchandisersarethesecondbiggestretailoutletwitha28%shareofthetotal
categoryssalesin2012,upfroma27%sharein2011.
In2012,theshareofdirectsalesdeclinesto11%from12%in2011,primarilydueto
thepoorperformanceofthedirectmarketer,Avon.
Table4G28:ManufacturersSalesofHandandBodyLotionsin
theUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Specialtystores
33
33
Massmerchandisers
27
28
Drugstores
18
18
Directsales
12
11
Departmentstores
Foodstores
Professionaloutlets
100
100
Total
MARKETINGACTIVITY
Overall
In2012,TMEforhandandbodylotionstotal$297.1million,up14.1%from$260.4million
in2011.
In2012,magazineadvertisingovertakestelevisionadvertisementsasthemostutilized
mediumofadvertisingamongmarketers.Marketersspend42.6%or$126.6ofthetotal
categorys TME on magazine advertisements in 2012, followed by 33.9% or
$60.0millionofthetotalcategorysTMEontelevisionadvertising.
4G65
4G66
HandandBodyLotions
Kaoisthelargestadvertiserinthecategory,withatotalTMEof$61.2millionin2012,up
Kao allocates $35.3million and $26.0 million to its Jergens and Curel brands,
respectively.
Jergens Ultra Healing is the most advertised product line from Jergens, with a TME
allocation of $12.3million in 2012. Majority of this expenditure is on television and
magazineadvertisements.
Johnson&Johnsonretainsitspositionasthesecondlargestadvertiserinthecategorywith
aTMEof$49.9millionin2012,down1.2%from$50.5millionin2011.
MajorityoftheTMEor$41.4millionisapportionedtowardsprintmediain2012.The
companyallocates$8.1milliontowardsmagazineadvertisements.
The company promotes its brands competing in the category through television
commercials and fullpage advertisements in popular beauty publications, such as
Glamour,Lucky,andBeautyFashion.
In2012,Johnson&Johnsonallocates$41.0millioninTMEtopromoteAveenosDaily
MoisturizingBodyLotion.
Beiersdorfcontinuestobethethirdleadingadvertiserinthecategory.
ThecompanyallocatesaTMEof$33.4millionin2012,up5.0%from$31.9millionin
2011.
In 2012, Beiersdorf spends $17.5million on its Nivea brand, with $12.4million being
allocatedtotelevisionmedia.
Beiersdorf allocates approximately $16million for its Eucerin brand in 2012, with an
equaldivisionbetweentheprintandtelevisionmedia.
Massbrands
Traditionalmarketingtechniquescontinuetobethemostpopularwiththemassmarketers
in2012.
Advertising, discounts, couponing, sampling, shelf displays, and consumer outreach
programsareafewtoolsthatmarketerscontinuetousetoincreasesales.
Magazine and television advertisements are the most heavily employed marketing media
forhandandbodylotions.
In 2012, Unilever endorses its Vaseline brand with nearly $41million in TME, with
54.9%at$22.5millionspentonmagazineadvertisements.
In 2012, Vaseline Intensive Care Rescue line is allocated a total TME of $20.1million,
spreadmainlyacrosstelevisionandtheInternetmedia.
In2012,KaosTMEexpenditureforitsJergensbrandis$35.3millionwithmajorityofit
beingspentonmagazineadvertisements.
JergensUltraHealingproductlineisthemostadvertisedproductlineforJergenswith
aTMEallocationof$12.3millionin2012.
In 2012, Beiersdorf apportions $17.5million as the advertising budget for its Nivea
brandwith70.9%oftheTMEspentontelevisionadvertisements.
4A66
HandandBodyLotions
Coupons of several denominations are offered by marketers in an attempt to entice

consumerstopurchasetheirproducts.
Coupons,whichareusuallyprintedordigital,makeproductsavailabletoconsumersat
a price lower than the regular market price. This induces consumers to splurge on
products.
Mass brands, such as Aveeno, Neutrogena, and Nivea use brochures to extend the
valueoftheproductsandincreasethepopularityofbrands,throughadvertisementsin
Sundaynewspapers.Mostbrands,suchasEucerin,Nivea,andJergensoffervouchers
throughmagazines,websites,andQRcodesonmobiles.Thishelpsmarketerstokeep
theirloyalconsumersinformedoftheirlatestoffersandnewproductlaunches.
In 2012, Eucerin offers coupons worth $1.50 on its hand and body products, Nivea
offerscouponsworth$2.00ononeNiveahandandbodylotionproduct,andJergens
offers a coupon worth $1.00 on one Jergens Skin Care Lotion. Social media sites and
Sundayfreestandinginserts(FSIs)arethemostfavoredmediatoadvertisesuchoffers.
Companies also utilize their brands websites to promote products and to communicate
withconsumers.
Throughtheirwebsites,marketersupdateinformationabouttheirbrandsbyproviding
detailedinformationandproductbenefits.
The Internet is progressively being used as a crossmarketing medium to promote a
brands presence across different media. A popular trend followed by almost all
companies is to link the brands websites with their social media pages, such as
Facebook,Twitter,andYouTube.
Moreover, recently many brands have started to enter the popularly growing social
mediachannelPinterest.
Most brands offer consumers an opportunity to win rewards by answering a few
questionsabouttheirbrands.Forexample,consumerscanavailrewardsbyanswering
afewquestionsaboutJergens(Kao).Thebrandswebsitealsoallowsconsumerstosign
up for the Jergens newsletters, which provides consumers with latest information on
thebrandshappeningsanddiscountsandoffers.
Doveswebsitealsoallowsconsumerstosignupforsuchnewsletterstherebyhelping
the brand communicate its latest promotions and offers. Doves website also offers
specialbeautyadvicesandtipstoitsaudience.Thebrandswebsitealsointeractswith
itsconsumersthroughvideos,quizzes,andgames.
Dove spreads awareness about the SelfEsteem Weekend and its other social
initiativesthroughthesocialmissiontabonitswebsite.Italsomakesavailableonits
website,discountcouponsandallowsconsumerstoregisterfortheDovenewsletter,
alsoknownastheDoveInsider.
4G67
4G68
HandandBodyLotions
Socialmediaisoneofthefastestgrowingmediausedbymarketerstopromotetheirbrands.
In majority of the cases, brands have their own social networking page or account which
contains information on the brands happenings and information on the brands newly
launchedandbestsellingproducts.
Leadingmarketers,suchassuchasUnilever,Kao,Johnson&Johnson,andBeiersdorf
extensively use social media channels, such as Facebook, Twitter, and YouTube, to
promotetheirbrandsandproducts.Thisprovidesconsumersaplatformtodiscussand
sharetheirexperiences,reviewproducts,andaskqueriesfrombrandexperts.
These social networking pages/accounts inform consumers about new product
introductions, events, special offers, discounts, coupons, sweepstakes, and other
companyinitiatives.
Consumers can post their queries on these sites and await a response from the
company. Marketers also utilize these pages to educate consumers through live chat
experienceswithindustryexpertsandcelebrities.
Additionally, social media allows marketers to directly communicate with consumers
thereby allowing companies to understand the dynamics of the market and create
productsthatcatertotheconsumersneeds.
Luxurybrands
Instorepromotions,directmailings,andatcountersamplingaretheprimarypromotional
toolsadoptedbyluxurymarketers.
Marketing activities, such as merchandising endeavors, pointofpurchase advertising,
sales assistance, displays, sampling, and price promotions, taking place inside a retail
environmentarecategorizedasinstoremarketing.
Departmentstoresusuallyemploysuperiorcustomerservice,specialevents,andgift
withpurchase(GWP)optionstopromotetheirbrands.
ThefundamentalpromotionaltoolsutilizedintraditionaldepartmentstoresareGWP
and purchasewithpurchase (PWP). Purchases are typically high during such
promotionalperiodssinceconsumersareawareofsuchoffers.
Salespersonsgenerallyundergoindepthtrainingaboutsuchluxuryproductssoasto
educateconsumersaboutsuchoffers.Luxurymarketersalsopromotetheirbrandsin
retailers catalogs and conduct various promotional activities that help set up direct
contactwithconsumers.
Specialtybrands
Specialtyretailersofferavisuallystimulatingenvironmentalongwithknowledgeablesales
associates,pricepromotions,andaconstantflowofnewproductstopersuadeconsumers.
4A68
HandandBodyLotions
Instore promotions that sport huge discounts are popular among specialty marketers.
LimitedBrandsusuallyadvertisesitsBath&BodyWorksbrandbyprovidingoffers,suchas
buytwoandgetonefreeandbuythreeandgetthreefreepromotionsonselectproducts.
Bath & Body Works helps clear its stock of goods through its two semiannual sales
heldinJanuaryandJune.Thesesalespavewayforthebrandslatestlineofproducts.
Thebrandalsoprovidescoupons,suchasa$10.00offonpurchaseofproductsworth
$30.00 and discounts, such as 20.0% off on entire purchase or buy four products for
$15.00orsixfor$20.00.
Specialtybrandsusuallyrenderdiscountsashugeas80.0%onselectproductsduring
theholidayseason.
Instore demos prove to be an effective marketing tool and relationship builder for
associates.Brands,suchasBath&BodyWorks,stayclearfromtelevisionandmagazine
advertisingandoftenutilizeinstoredemonstrationssincetheyhaveamorepersonal
touch. Window displays is another commonly used promotional tool utilized by
specialtybrands.Specialtybrandsalsooffertesterstoconsumerstotrynewproducts.
TheBath&BodyWorkswebsitecontainsalistofallproductsalongwithaspecialtab
for all the products on sale. The brand offers discounts on some of its products
throughouttheyear.Freeshippingonpurchasesabove$50.00isanotherpromotional
toolwhichisoftenusedbythemarketer,especiallyduringtheholidayseasonof2012.
OUTLOOK
Manufacturerssalesofhandandbodylotionsareforecasttopostapositivegrowthwitha
CAGRof1.8%duringtheforecastperiodending2017.
Handandbodylotionsisamaturecategorywithhighlevelofcompetitionamongthe
existingbrandsandpresentslimitedscopeforinnovation.
Marketersintroductionofnewproductsofferingadditionalbenefits,suchasantiaging,
sun care, therapeutic, and natural formulations will help achieve a moderate growth
forthecategoryandmaintainconsumersinterest.
Privatelabelproductsarelikelytogrowtheirsalesduringthenextfiveyears.
Private label is expected to expand their product portfolio by offering good quality
multifunctionalproductsataffordableprices.
4G69
4G70
HandandBodyLotions
Natural and organic products are expected to be the driving force behind the categorys
growthduringtheforecastperiodending2017.
The natural and organic products segment will continue to perform well during the
nextfiveyearsasconsumersbecomemoreconsciousofwhattheyapplyontheirskin.
Oncetheproductefficacyisproven,consumersarelikelytotradeupforthesehigher
priced naturallypositioned products, thereby supporting the overall growth of the
category.
Marketersnotpresentinthenaturalssegmentwithproductofferings,areexpectedto
makeanattempttoenterthisprofitmakingsegment.
Smallmassmarketerswithlimitedfinancialsupportarealsoexpectedtoencashupon
this opportunity by offering naturallypositioned products, although with lesser and
morecommonlyavailablenaturalingredients,suchasaloevera,coconutoil,almondoil,
oliveoil,honey,andsheabutter.
Innovation will be of key importance to the category during the forecast period, 2012 to
2017.
Productinnovationwillplayamajorroleinthecategorysgrowth.
Innovation could be in the form of new product activity, packaging changes, and
improvedformulationsincludingtechnologicaladvancements.
Unlessmarketerscontinuetoinnovate,thecategoryislikelytostagnate.
Marketers are expected to innovate with the packaging formats of their products
duringtheforecastperiodbymakingtheirformulationsavailableinformatsthatallow
convenientandeasyapplicationoftheproducts.
Marketersareexpectedtoadoptinnovativemarketingtechniquesinordertopromotetheir
products.
Establishedmassmarketerswillcontinuetoallocatesignificantamountofadvertising
expenditurestopromotetheirrespectivebrands.
Majority of the marketers are already present on social media networks, such as
FacebookandTwitter,withmanyexpandingtheiroutreachtoYouTubeandPinterest.
Marketers can widen their marketing approach by educating consumers on the
benefitsoftheingredientsusedintheproductsandadvisingthemonthebestsuitable
handandbodylotionfortheirskintypebasedontheproductformulation.
Samples, coupons, giveaways, and contests will continue to be a major part of mass
brandsmarketingstrategy.
4A70
HandandBodyLotions
The consistent rise of the baby boomer population across the United States will facilitate
marketersinexpandingtheirproductlineswithantiagingproperties.
Antiagingisalreadyanestablishedtrendinthethefacialtreatmentscategoryandis
expectedtohaveamajorimpactinthehandandbodylotionscategory.
Consumers pose an increased awareness of their overall appearance and would not
only want antiaging products for their face but for their entire body, for a uniform
youngerlookingappearance.
Hand and body lotions with antiaging properties will present the marketers an
opportunitytobargainforhigherpricesfortheseproducts,astheywouldoffermuch
morethanregularmoisturizingandhydratingbenefits.
Overthenextfiveyears,theproductformulationsarelikelytoincludeantioxidantsand
SPFasincreasedexposureoftheskintoUltraVioletAlfa(UVA)andUltraVioletBeta
(UVB)raysisakeyreasonbehindprematureaging.
Themassanddirectsaleschannelsarelikelytogrowduringtheforecastperiod.
Natural product offerings from mass merchandisers will add to the sales of the mass
channel.
Since the category is a valuedriven category, consumers seek valueadded products
availableatareasonableprice.
Moreover,privatelabelproductsavailableinmassmerchandiserswilladdtothesales
ofthedistributionchannel.
Over the course of the next five years, the direct sales channel is expected to gain
momentum as the ecommerce trend gains popularity among consumers with many
marketersallowingconsumerstobuyfromtheirowncompanyswebsitethangotoa
retailerswebsite.
Privatelabelisexpectedtoproliferateoverthenextfiveyears.
Privatelabel products, available at retailers, which gathered popularity during the
recession,arelikelytobewellacceptedbyconsumersduringtheforecastperiod.
Thelowpricedprivatelabelproductswillbeassociatedwithqualityproductofferings
providingresultssimilartothoseofferedbynationalbrandsandatalowerpricepoint
ascomparedtonationalbrandsproducts.
Overthenextfiveyears,retailersareexpectedtointroducehandandbodylotionswith
multibenefitsgivingstiffcompetitiontonationalbrands.
Sales of hand and body lotions are forecast to increase at a CAGR of 1.8% from
Unit volume is expected to advance to 552.0million packages by 2017, up at a CAGR of

1.4%from514.2millionpackagesin2012.
4G71
4G72
HandandBodyLotions
4A72
SKINCAREPRODUCTSFORMEN
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesfortheskincareproductsformenscategorypostahealthygrowthof
Since2007,thecategoryssaleshavegrownatacompoundannualgrowthrate(CAGR)of
3.4%.
Table4G29:HistoricalSalesofSkinCareProductsfor
MenintheUnitedStates,2007to2012
Year
$Millionr
Change,%
2007
143
2008
151
5.6
2009
146
(3.3)
2010
143
(2.1)
2011
154
7.7
2012
169
9.7
rRestated.
Unitsales
The categorys unit sales grow at 9.2% from 17.3million packages in 2011 to 18.9million
packagesin2012.
Retailsales
Salesattheretailleveltotal$265millionin2012,up9.5%from$242millionin2011.
4G74
SkinCareProductsforMen
Table4G30:ManufacturersSalesofSkinCareProductsforMenintheUnitedStatesbyBrand,2011and2012
Brand
Company
NeutrogenaMen
$Million
%Oftotal
2011
2012
2011
2012
Johnson&Johnson
22
23
14.3
13.6
CliniqueSkinSuppliesforMen
EsteLauder
18
19
11.7
11.2
NiveaForMen
Beiersdorf
14
14
9.1
8.3
AnthonyLogisticsForMen
AnthonyBrands
10
11
6.5
6.5
JackBlack
JackBlack
10
11
6.5
6.5
LabSeriesSkincareForMen
EsteLauder
10
11
6.5
6.5
Kiehl's
LOral
4.5
4.1
TheArtOfShaving
Procter&Gamble
3.2
3.6
Vaseline
Unilever
3.2
3.6
Bath&BodyWorks
LimitedBrands
3.2
3.0
ClarinsMen
Clarins
3.2
3.0
Zirh
TPRHoldings
3.2
3.0
LOralMensExpert
LOral
2.6
2.4
Origins
EsteLauder
2.6
2.4
LancmeMen
LOral
1.9
1.8
Gillette
Procter&Gamble
1.3
1.2
LaPrairie
Beiersdorf
0.6
0.6
24
32
15.6
18.9
154
169
100.0
100.0
Allotherr
Totalr
rRestated.
CATEGORYDEVELOPMENT
Markettrends
Manufacturers sales in the skin care products for mens category grow 9.7% to reach
$169millionin2012.
Growthisdrivenbythepositiveperformanceofmarketersinthecategory,especially
prestigebrands,suchasAnthonyLogisticsForMen,LabSeriesSkincareForMen,Jack
Black,andCliniqueSkinSuppliesforMen.
Prestige marketers, such as Este Lauder, Anthony Brands, and Jack Black introduce
new and innovative product offerings to reach out to the male consumers who are
increasinglybecomingconsciousoftheusageofproductstoimprovetheirappearance.
Established marketers including Este Lauder, Johnson & Johnson, Beiersdorf, and
Procter&Gamblehavestartedtopayincreasedemphasisondevelopingtheirmens
skincareproductlinesasthedemandformensskincareproductsrisesamongmenof
allagegroups.
4A74
Mensfacialskincarerepresentsahugeopportunityformarketers.
Marketers have an opportunity to expand in the mens facial skin care segment with
relevant product offerings on antiaging, sun protection, and moisturizing; however,
the challenge involves getting them interested in these products, as men only use
productstargetingbasiccleaningandmoisturizing.
Since mens skin texture varies from that of women, marketers have to work to
educatemen,andurgethemtouseskincareproductsdesignedspecificallyformenin
ordertoachievepositiveresults.
Throughtheirwebsites,marketerseducatethemaleconsumeronthecorrectusageof
products.
Additionally, with the availability of a wide array of product offerings targeting
differentbodyareaswithuniquebenefits,marketersaretryingtoconveytothemale
consumersthattherearedifferentproductsforthebodyandface,andthetwoshould
notbeusedinterchangeably.
Thecategorybenefitsfromthestrongperformanceofprestigebrands.
Prestige marketers dominate the category, accounting for almost 50% of the total
PrestigebrandsincludingLabSeriesSkincareForMen,JackBlack,CliniqueSkinSupplies
for Men, and Origins continue to innovate with the introduction of new products to
attractmaleconsumers.
Thehighperformingsegmentsintheskincareproductsformencategoryincludefacial
moisturizers,eyetreatments,andantiagingcreams.Prestigemarketersofferingsuch
productsincludeLabSeriesSkincareForMen,CliniquesSkinSuppliesforMen,Clarins
Men,andAnthonyLogisticsForMen.
Moreover, there has been an emergence of new prestige mens skin care marketers
which not only drive growth for the segment but also educate men on the way they
perceive grooming. In 2012, J. Paul Skin Care For Men enters the market with the
GuardFaceandBodyLotion.
In2012,massmarketerscontinuetopenetratetheskincareproductsformenscategory.
Themarketshareofthemassmarketersincreasesfrom39.6%in2011to40.2%in2012.
Johnson & Johnsons Neutrogena Men continues to be the leading brand in the
categorywiththesalesof$23millionin2012.
Vaseline grows 20.0% albeit from a small base of $5 million in 2011 to $6 million in
2012.
Mass brands recording constant sales in 2012 include Nivea For Men, L'Oral Men's
Expert, and Gillette. A few other smaller mass brands in the market include Dove
Men+Care,Menscience,Palmers,andGoldBond.
4G75
4G76
Thereisagrowingshifttowardsthenaturallypositionedproducts.
Marketers are increasingly enriching their products with natural ingredients to gain
sales, get better acceptance among consumers, and as a means of differentiating
themselvesfromothermarketers.
In 2012, Ultra Balm introduces the Ultra Handy Man, a product that is enriched with
aloevera,lanolin,andvitaminAandE.
Jack Black launches the Dry Erase UltraCalming Face Cream with Hydromanil, ginger
root,andvitaminCandEin2012.
There is a growing awareness among many consumers of the possible harm from a
numberofcommonlyusedsyntheticingredients.
Asaresult,moreconsumersarebuyingproductsformulatedwithsubstantialamount
of natural ingredients that are free of parabens, formaldehydes, dyes, and added
fragrances.
Productsofferingantiagingandsuncarebenefitsaregainingpopularitywithmen.
Mensskincareproductsofferingantiagingpropertiesareincreasinglygainingdemand
inthemarketasmaleconsumersbecomeparticularoftheirlooksandwishtomaintain
theiryouthfulappearance.
AfewoftheantiagingvariantsavailableinthemarketincludeKiehlsFacialFuelAnti
WrinkleCream,NeutrogenasMensAgeFighterFaceMoisturizerwithsunscreenSPF
15,LabSeriesSkincareForMensAgeRescueEyeTherapy,JackBlacksProteinBooster
EyeRescue,andKiehlsFacialFuelTransformerAgeCorrectingMoistureGelforMen.
Furthermore,mensskincareproductswithsunprotectionalsogainpopularity.
Some of the variants available are Neutrogena Mens Triple Protect Face Lotion with
sunscreenSPF20,AnthonyLogisticsForMensMintandWhiteTeaAdvancedFormula
LipBalmSPF25,andJackBlacksDoubleDutyMoisturizerSPF20.
Progressively retailers are also taking initiatives to cater to the growing desire of men for
skincareproducts.
In 2012, Macys in Philadelphia opens a mens grooming zone on its beauty selling
floor. The area carries highend mens skin care brands, such as Jack Black, Shiseido
Men,andLabSeriesSkincareForMen.
Ulta and CVS already have similar spaces for men with Ulta offering male grooming
boutiquesinsideitsstoresandCVSofferingGuyAisleswithallmalefocusedproducts
displayedinasingleaisle.
4A76
Setsandkitscontinuetogarnerattentionin2012,leadingtohighersalesformarketers.
Marketersareincreasinglyintroducingsetsandkits,whichincludesmallsizedproduct
offerings packed together, as a means of attracting men towards a single pack that
shalltakecareoftheirentireregime.
This is a strategy adopted by marketers to lure men who are new to using skin care
products and do not know how to navigate through choices of products available,
therebymakingtheessentialsofaskincareregimeavailabletotheminonepackage.
They have the added benefit of being offered at a lower price than when bought
individually.
Also, through these sets and kits, the consumer can judge the efficacy of these
productsontheirskinwithoutspendingmoreforlargebottles,onlytorealizelaterthat
theyarenotsatisfiedwiththeresults.
AnthonyLogisticsFor MenoffersaFaceKitcomprisingGlycolicFacialCleanser,Deep
PoreCleansingClay,AllPurposeFacialMoisturizer,andFacialScrub.
Lab Series Skincare For Men has a number of kits and sets in its line of products
including Skincare Simplified Kit, Blemishes/Breakouts Solutions Kit, Age Rescue Kit,
andMAXLSLuxurySolutionKit.
Notablenewproducts
Table4G31:SelectNewSkinCareProductsforMenIntroducedintheUnitedStatesin2012
Company
Brand
Description
EsteLauder
CliniqueSkin
SuppliesforMen
DarkSpotCorrectorisapowerfulserumformensskinthathelpsreducethe
appearanceofdarkspots,acnescars,andsunspotsonallkindsofskintypesand
tones.Helpsreduceingrownhairandresultsstartbecomingvisibleinaslessas
fourweeks
EsteLauder
CliniqueSkin
SuppliesforMen
AntiFatigueCoolingEyeGelisarollongelthatgivesinstantresultswithrespect
torevitalizing,hydrating,andbrighteningtiredeyes.Itisalsoclaimedtoreduce
puffinessanddarkcirclesaroundtheeyes
EsteLauder
LabSeriesSkincare
ForMen
MAXLSDailyRenewingCleanserisaMoleculeAgeLessComplexthatcombines
withtheoxygenationactionthatwashesawayimpuritieswithoutaffectingthe
skinsnaturalPHbalance
EsteLauder
LabSeriesSkincare
ForMen
MAXLSSkinRechargingWaterLotionisaweightlesshydratinglotionthatis
formulatedwithMoleculeAgeLessComplexcomprisingAquatrontechnologyto
removeold,dead,anddullskinwithoutaffectingtheskinsnaturalPHbalance
EsteLauder
LabSeriesSkincare
ForMen
MAXLSLightMoistureLotion,formulatedwithSirtuintechnologyandMolecular
AgeLessComplex,isalightweightdailymoisturizingtreatmentthatpreventsand
repairssignsofaging
EsteLauder
LabSeriesSkincare
ForMen
InstantSkinBoosterisformulatedwithFirmaboostComplextotightenanduplift
theskinontheoutsideandstrengthentheskinsnaturalcollageninternally
EsteLauder
Origins
SaveTheMalesisamultibenefitoilfreelotionthatkeepstheskinhealthyand
hydrated.Itisenrichedwithnaturalingredients,suchascarrotprotein,Chinese
wolfberry,mangosteenextract,andwhitebirch
(Continued)
4G77
4G78
Table4G31:SelectNewSkinCareProductsforMenIntroducedintheUnitedStatesin2012
Company
Brand
Description
JackBlack
JackBlack
DryEraseUltraCalmingFaceCreamisenrichedwithhydromanil,gingerroot,and
vitaminCandEintheformofanongreasycreamtoprovideinstantandlong
lastingmoisturizingfordryskin.Italsocalmsirritatedskinandhelpsreducethe
redness
JackBlack
JackBlack
TurboBodyBarScrubbingSoapisenrichedwithnaturalbluelotus,ginkgobiloba,
murumuru,sheabutter,andnaturallavarockwhichhelpscrubawayandexfoliate
thebodytogivesmoothandsuppleskin
JackBlack
JackBlack
CoolMoistureBodyLotionisalightweightandquickpenetratinglotioninfused
withsoyprotein,vitaminE,andjojobafornourishingandhydratingskin
JackBlack
JackBlack
IntenseTherapyLipBalmSPF25Mango&Mandarinisenrichedwithskin
conditionersandantioxidantstosoothedryandchappedlipswhileofferingbroad
spectrumSPF25protection
JackBlack
JackBlack
IntenseTherapyLipBalmSPF25SheaButter&VitaminEisenrichedwithskin
conditionersandantioxidantstosoothedryandchappedlipswhileofferingbroad
spectrumSPF25protection
J.PaulSkinCare
ForMen
J.Paul
GuardFace&BodyLotionisenrichedwithvitaminEandaloeveraandSPF20for
protectionagainstUVA/UVBsunrayswhileprovidingantiagingprotection
Johnson&
Johnson
NeutrogenaMen
SkinClearingAcneWashisanoilfreegentleformulawhichcleansesdeepporesto
minimizebreakoutsandingrownhairandpreventnewonesfromappearing
LimitedBrands
Bath&BodyWorks
ParisForMenBodyLotionisenrichedwithjojobaoil,sheabutter,andvitaminEto
defendtheskinagainstdrynessandkeepitlookinghealthyandsupple.Itsscentis
ablendofwhitewood,orangezest,andmusk
LimitedBrands
Bath&BodyWorks
ParisForMen2in1Hair&BodyWashsexclusiveformulagivesafastrinsingand
richlatherexperienceforanallovercleanexperience.Itsscentisablendofwhite
wood,orangezest,andmusk
LimitedBrands
Bath&BodyWorks
DarkAmberForMenBodyLotionisenrichedwithjojobaoil,sheabutter,and
vitaminEtodefendtheskinagainstdrynessandkeepitlookinghealthyand
supple.Itsscentisablendofbergamotandwarmamber
LimitedBrands
Bath&BodyWorks
DarkAmberForMen2in1HairandBodyWashsexclusiveformulagivesafast
rinsingandrichlatherexperienceforanallovercleanexperience.Itsscentisa
blendofbergamotandwarmamber
COMPETITION
Bybrand
Neutrogena Men (Johnson& Johnson) is the largest mens skin care brand with
manufacturerssalesat$23millionin2012,up4.5%from$22millionin2011.
The brands growth is mainly attributed to the sale from its facial treatments,
specificallyitsfacewashesandfacialtreatmentscontainingSPFbenefits.
Neutrogena Men competes in the category through four product lines including
NeutrogenaMen,RazorDefense,SensitiveSkin,andSkinClearing.
Thebrandsfurthergrowthin2012hasbeenoffsetbythelackofnewandinnovative
productactivity.
4A78
EsteLaudersCliniqueSkinSuppliesforMenisthesecondlargestbrandinthecategory,
withsalesat$19millionin2012,anincreaseof5.6%from$18millionin2011.
Thebrandsmarketshareinthecategorydeclinesfrom11.7%in2011to11.2%in2012.
GrowthforthebrandissupportedbytheintroductionoftheAntiFatigueCoolingEye
GelandtheDarkSpotCorrectorin2012.
Furthersalesgainforthebrandisoffsetbythelimitedproductofferingsofthebrand
for younger consumers, who are an important market segment for the entire
categorysgrowth.
Nivea For Men (Beiersdorf) continues to be the thirdleading brand, with sales remaining
constantat$14millionin2012from2011levels.
The brand remains stagnant in 2012 as there is no new product activity or change in
formulationsforitsproducts.
Thebrandstraceablemediaexpenditures(TME)in2012areamere$1.9million.
Tied in the fourth place are three brands: Lab Series Skincare For Men, Anthony Logistics
ForMen,andJackBlack.
Allthreebrandsgrowapproximately10.0%from$10millionin2011to$11millionin
2012.
LabSeriesSkincareForMensgrowthisprimarilyduetoitsnewandinnovativeproduct
launchesincludingtheInstantSkinBooster,BBTintedMoisturizerbroadSpectrumSPF
35,MAXLSDailyRenewingCleanser,MAXLSLightMoistureLotion,andMAXLSSkin
RechargingWaterLotion.
SomeofLabSeriesSkincareForMensbestsellingproductsaretheMultiActionFace
Wash, MultiAction Face Wash Limited Edition, Daily Moisture Defense Lotion Broad
SpectrumSPF15,InvigoratingFaceScrub,AgeRescueFaceLotion,andOilControlFace
Wash.
Anthony Logistics For Mens bestsellers include Glycolic Facial Cleanser, Facial
MoisturizerSPF15,ContinuousMoistureEyeCream,andFacialScrub.
JackBlackperformswellin2012asitsproducts,althoughmalespecific,arebeingused
bywomenincreasinglyduetotheprovenefficaciousresults.
JackBlackcompetesintheskincareproductsformenscategoryundertheantiaging,
moisturizers,andcleanserssegments.
JackBlacksbestsellingproductsincludeIntenseTherapyLipBalmSPF25,PureClean
DailyFacialCleanser,AllOverWashforFace,Hair&Body,FaceBuffEnergizingScrub,
Cool Moisture Body Lotion, Industrial Strength Hand Healer, and DoubleDuty Face
MoisturizerSPF20.
4G79
4G80
RETAILDISTRIBUTION
Departmentstorescontinuetobetheleadingdistributionchannelintheskincareproducts
formencategoryaccountingfor49%ofthetotalsales,constantfrom2011levels.
Althoughmassmarketersdowellin2012,thepercentageshareofmassmerchandisers
remainsconstantat18%in2011and2012.
The number of men purchasing skin care products over the Internet increases.
However,itisnotsufficienttoraisethedirectchannelsshareinthecategory.
Theotherthreeretailsaleschannelsdrugstores,specialtystores,andfoodstores
donotexperienceasignificantchangeinthesharepercentagein2012.
Table4G32:ManufacturersSalesofSkinCareProductsforMen
intheUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Departmentstores
49
49
Massmerchandisers
18
18
Drugstores
15
15
Specialtystores
12
12
Foodstores
Directsales
100
100
Total
MARKETINGACTIVITY
The key aim of the brands in this category is to build greater engagement with the male
consumers.
Gymnasiums and lounges are popular places targeted by marketers to promote their
products.
Some male consumers are not comfortable shopping for grooming products. To
encourage purchase, marketers adopt the strategy of building menspecific areas for
theprivacyandcomfortofthemaleconsumers,wheretheycantryouttheproductsat
ease.
However,marketersalsotryandattracttheattentionofyoungmaleconsumerswho
are often more comfortable using mens products as compared to the older
generations.
4A80
Instorepromotionisalsocommon,especiallyinpartnershipwithmasterbrands.
Instore events are organized by marketers, such as Anthony Logistics For Men, to
share information with male consumers about the products available, provide
educationonproductbenefits,andinducepurchase.
Sampling is also as an effective means to get men to try a product and encourage
buying.
Manymarketerstargetwomentopromotethepurchaseofskincareproductsformenasit
is the women who make purchases for most men. Women also have higher engagement
withhealthandbeautyproducts.
Marketers are tapping this line of approach by promoting male products cobranded
withtherelatedfemaleproducts,tocapturetheattentionofthefemaleconsumers.
Marketers such as Nivea and LOral with a presence in both the male and female
categories, often merchandise male products with the female products to encourage
purchasebyfemaleconsumers.
In 2012, Unilever promotes its Dove Men+Care line through the Journey to Comfort
campaign.
UndertheJourneytoComfortcampaign,thecompanyteamsupwithbasketballstars,
ShaquilleONeal,SteveNash,andMichiganStateUniversityHeadCoach,TomIzzo.The
campaign gives sports fans a glimpse into their professional and personal lives, by
sharing unique stories and events that changed their lives, lessons learnt from their
familyandcoaches,andstrugglesenduredtoachievetheirgoalsintheformofvideos.
DoveMen+CareFacebookpageinitiatestheShaqsBigExcuseFacebookapplication,
whichallowsfanstosendcustomizedmessagestoacquaintancesandfriends.
Dove Men+Care also collaborates with Viggle, an application, which allow fans who
checkintoNCAAbasketballgameswithinViggle,withachancetoearnextrapointsby
watchingtheJourneytoComfortvideos.
LOral promotes the Kiehls brand in the United States by providing complimentary
shippingandthreesamplesonordersabove$50.00.
Television advertising continues to account for a major part of the marketing spend
representing72.3%or$11.5millionofthetotalTMEinthecategoryin2012.
In order to encourage more men to indulge in skin care products, most marketers
collaboratewithsportspersonsandathletestopromotetheirbrandssincemenhavea
specialaffinitytowardssports.
Marketers opt for social media platforms, such as Facebook and Twitter to promote
deals and offers, however, most marketers find it risky to depend on social media
completelywhilesubsequentlycuttingbackontelevisionadvertising.
4G81
4G82
In2012,TMEfortheskincareproductsformencategorytotalsapproximately$15.9million,
anincreaseof245.7%from$4.6millionin2011.
Marketersspend72.3%oftheTMEontelevisionadvertising.
Johnson&JohnsonhasthehighestTMEinthecategoryatapproximately$10millionin
2012.Johnson&JohnsonsentireTMEisallocatedtoitsLubridermbrandin2012.
Beiersdorf is the secondlargest marketer with a TME of $1.9 million in 2012. It
allocatesmajorityofitsTMEtotheExpressAbsorptionBodyMoisturizer.
report.
OUTLOOK
Manufacturerssalesinthemensskincareproductscategoryareexpectedtogrowduring
the forecast period ending 2017. The category has strong potential for both value and
volumegrowthinthefuture.
Current developments in the form of growing demand for antiaging, natural and sun
careproductsaretestimonytothefactthatthecategoryhasstronggrowthpotential.
Theleadingmarketersofthebeautyindustry,Procter&Gamble,Unilever,EsteLauder,
Beiersdorf, LOral, and Johnson & Johnson have taken steps in the form of new and
innovativeproductlaunchesandincreasedmarketingsupporttoincreasetheirpresence
inthecategorybybringingawarenessamongconsumers.
cleanseregime.
Duringtheforecastperiodending2017,thereisanincreasedlikelihoodofmenofallage
groupspurchasingmensskincareproducts.
As marketers continue to innovate and spread awareness about mens skin care
products, the proportion of men buying these products is likely to increase gradually
with the male consumers feeling less awkward to go out and buy male specific
products, as opposed to the earlier practice of using products of their female family
members.
4A82
WiththegrowingbabyboomerpopulationintheUnitedStates,theforecastperiodending
2017shallwitnessagrowingdemandforantiagingproducts.
Thereisastrongopportunityintheantiagingsegmentwithagrowingdemandfrom
menaged30yearsandolderforproductsofferingantiagingbenefits.
Similartowomen,menarealsoexpectedtoseekantiagingsolutionstohelpfightsigns
ofaginginordertolookasyoungandpresentableaswomenoftheirage.
The younger generation of men is also likely to use these antiaging benefits in the
anticipationthattheearlyuseoftheseproductsmightdelaytheagingprocedure.
Products for men offering cosmetic benefits, such as concealers and tinted moisturizers,
alreadyavailableinthemarketwillbeanotherareaformarketerstoattracttheattentionof
themaleconsumers.
These cosmetic beneficial products have recently entered the market, the success of
which is yet to be seen. There is a likelihood of a change in the landscape provided
theseproductsreceivesuccessfromconsumers.
The skin care products for men category provides marketers an opportunity to shift their
attentionfromthesaturatedfemalecentriccategories.
Marketershaveroomtoinnovatewithnewandinnovativeproductsandformulations
intheantiagingandSPFformulatedhandandbodylotionssegments.
Also, marketers have the opportunity to expand their products lines with naturally
formulatedproducts.
Also,thereisanopportunityforestablishedmarketerstoforayintothecategorywith
new brands and for new startup companies to enter the cosmetics and toiletries
industrywithproductofferingsintheskincareproductsformencategory.
Marketingwillplayapivotalroleinpromotingmarketersproductofferings.
The marketing expenditure is expected to increase over the next five years, with
marketers concentrating more on promoting the mens skin care brands than the
femalecentricbrands.
Television advertising will continue to be the key area of TME expenditure for
marketers followed by magazines, as visual marketing endorsed by celebrities has
proventobethemosteffectivemarketingmediaovertheyears.
Social media in the form of Facebook, Twitter, YouTube, and Pinterest, and digital
marketingthroughmobilemarketingwillbetheothermarketingmediumsadoptedby
marketersduringthecourseofthenextfiveyears.
Prestigemarketersareexpectedtocontinuetodominatethecategorythrough2017.
Althoughprestigemarketersshallcontinuetoholdmajorityofthemarketshareinthe
category, market share for mass marketers are expected to grow faster than the
prestigebrandsduringtheforecastperiod.
Themasssegmentinthecategoryislikelytowitnessnewentrantsintheformofnew
malespecific marketers and femalecentric marketers expanding their outreach to
introducemenspecificproductlines.
NeutrogenaMenisexpectedtobethelargestbrandinthecategorywithothermass
brandsenteringthetop10brandsintermsofsalesinthecategory.
4G83
4G84
Sales of skin care products for men are forecast to advance at a CAGR of 5.4% to
$220millionin2017,upfrom$169millionin2012.
UnitvolumeisexpectedtoadvanceataCAGRof5.2%from18.9millionpackagesin2012to
24.5millionpackagesby2017.
4A84
SUNCAREPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturerssalesinthesuncareproductscategoryadvance6.5%in2012.
Categorysalesgrowfrom$984millionin2011to$1,048millionin2012.
Since 2007, manufacturers sales for the category have grown at a compound annual
growthrate(CAGR)of6.4%,from$769millionin2007to$1,048millionin2012.
Table4G33:HistoricalSalesofSunCareProductsin
Year
$Millionr
Change,%
2007
769
2008
844
9.8
2009
860
1.9
2010
933
8.5
2011
984
5.5
2012
1,048
6.5
rRestated.
Unitsales
Unitsalesinthesuncareproductscategorygrow6.2%from230.6millionpackagesin2011
to244.8millionpackagesin2012.
Retailsales
Retail sales of the category are estimated at $1,545million in 2012, up 6.9% from
4G86
SunCareProducts
Table4G34:ManufacturersSalesofSunCareProductsintheUnitedStatesbyTradeClassandBrand,2011and2012
Tradeclass/brand
Company
MASS
$Million
2011
2012
%Oftradeclass
2011
%Oftotal
2011
2012
BananaBoat
EnergizerHoldings
168
179
20.3
20.2
17.1
17.1
Coppertone
Merck
159
173
19.2
19.5
16.2
16.5
Neutrogena
Johnson&Johnson
158
169
19.1
19.0
16.1
16.1
HawaiianTropic
EnergizerHoldings
49
51
5.9
5.7
5.0
4.9
LOralParis
LOral
24
28
2.9
3.2
2.4
2.7
Aveeno
Johnson&Johnson
20
20
2.4
2.3
2.0
1.9
CoppertoneWaterBabies
Merck
16
19
1.9
2.1
1.6
1.8
OceanPotion
Sun&SkinCareResearch
13
14
1.6
1.6
1.3
1.3
AustralianGold
AustralianGold
12
13
1.4
1.5
1.2
1.2
LOralParis
LaRochePosay
11
13
1.3
1.5
1.1
1.2
NoAdr
Sun&SkinCareResearch
10
11
1.2
1.2
1.0
1.0
Bullfrog
Sanofi
1.0
0.9
0.8
0.8
FruitoftheEarth
FruitoftheEarth
0.6
0.6
0.5
0.5
PanamaJack
PanamaJackProducts
0.4
0.5
0.3
0.4
BaindeSoleil
Merck
0.1
0.1
0.1
0.1
Sea&Ski
RadiantTechnologies
0.1
0.1
0.1
0.1
Privatelabel
Privatelabel
117
122
14.1
13.7
11.9
11.6
53
57
6.4
6.4
5.4
5.4
828
888
100.0
100.0
84.1
84.7
Allotherr
Totalr
LUXURY
Clarins
Clarins
13
13
18.3
17.6
1.3
1.2
Clinique
EsteLauder
12
12
16.9
16.2
1.2
1.1
Lancme
LOral
12
12
16.9
16.2
1.2
1.1
Origins
EsteLauder
11.3
12.2
0.8
0.9
EsteLauder
EsteLauder
11.3
10.8
0.8
0.8
Shiseido
Shiseido
9.9
10.8
0.7
0.8
11
12
15.5
16.2
1.1
1.1
100.0
100.0
Allother
Total
71
74
7.2
7.1
DIRECT
29
28
55.8
53.8
2.9
2.7
11.5
11.5
0.6
0.6
17
18
32.7
34.6
1.7
1.7
52
52
100.0
100.0
5.3
5.0
LimitedBrands
18
18
54.5
52.9
1.8
1.7
Avon
Avon
MaryKay
MaryKay
Allother
Total
SPECIALTY
Bath&BodyWorks
Allother
15
16
45.5
47.1
1.5
1.5
Total
33
34
100.0
100.0
3.4
3.2
TOTAL
984
1,048
100.0
100.0
100.0
100.0
rrestated.
REPRODUCTIONOR DISCLOSUREFORBIDDEN;SEESPECIALNOTICE KLINE&COMPANY,INC.
4A86
2012
SunCareProducts
CATEGORYDEVELOPMENT
Markettrends
Manufacturerssalesinthesuncareproductscategorygrow6.5%from$984millionin2011
Thecategorysgrowthisdrivenbyincreasingawarenessamongconsumersaboutthe
harmfuleffectsoftheskinsexposuretothesunsrays.
Other factors contributing to the categorys growth include new product activity,
packaging and labeling changes, innovative reformulations, and good performance of
privatelabelproducts.
Rising awareness among consumers about the harmful effects of the UV rays helps boost
Consumersarebecomingincreasinglyawareandeducatedaboutthepotentialdangers
ofsunexposure.
SkincancerisanevergrowingconcernamongthepeopleintheUnitedStatessincethe
majorityofthepopulationcomprisesfairskinnedpeoplewhoaremoresusceptibleto
skin cancer than darkskinned people. Also, people living in geographies around the
equator,suchasCalifornia,Texas,andFloridaarepronetomoresundamagedueto
thedirectraysofthesun.
Organizations,suchastheSkinCancerFoundation,thePersonalCareProductsCouncil,
the American Association of Dermatologists, and manufacturers, such as Johnson &
Johnson, Energizer Holdings, and Merck play an instrumental role in educating
consumersaboutthehazardsoftheskinsoverexposuretothesunsrays.
In2012,theSkinCancerFoundationorganizedthethirdannualeventANighttheStars
ShineOninNewYorktofightagainstskincancer.Theproceedsfromtheeventbenefit
theTheSkinCancerFoundationsresearchandeducationinitiatives.
Marketers,suchasMerck,EnergizerHoldings,Johnson&Johnson,andSun&SkinCare
Research also undertake the help of the increasingly popular social media network
channels, such as Facebook, Twitter, and YouTube, to spread awareness among
consumers.
Sunscreen application remains one of the most important preventative measures
againstsunburn,photoaging,andskincancer.
Many consumers are not aware of the amount of product that is necessary to be
applied, and in most cases, are likely to underdose than overdose the amount of
product applied, thereby making their skin susceptible to sun exposure unknowingly
andincreasingtheriskpotentialofskincancer.
4G87
4G88
SunCareProducts
Packagingisofutmostimportancetosuncareproductsmarketers,becauseofthevolatile
natureoftheproductformulations.
With the evolution of the sun care market, marketers are introducing complex
formulationsthatrequireinnovativepackagingsolutionsincludingairlesspacks,foams,
sprays,anddispensertubes.
Packaging suppliers also face challenges as there is a growing demand for high SPF
formulated products and the higher the SPF in a formulation, the more vicious the
formulaisandgreateristhechallengetodispenseiteffectively.
Sincesuncareproductsarechemicallyaggressive,itisverydifficulttomaintaintheir
packagingandkeepthempackagedforalongerdurationoftime
Marketers are mindful of the fact that packaging of sun care products should be
designed in a manner which allows for easy dispensing of thick formulations and is
convenienttoapply.
Moreover, people often pack sun care products for travel, and therefore marketers
needtomaketheseproductsavailableinleakproofformats.
Companies,suchasEnergizerHoldings,Merck,Sun&SkinCareResearch,andLOral
areincreasinglyshiftingtowardsusingairlessdispensersinordertoextendshelflifeof
theproductbyenhancingformulaprotectionfromexposuretoair.
These airless dispensers are available in allplastic packaging which implies easy
recyclability.Thesprayonapplicationiseasier,moreconvenient,andlessmessythan
thetubeapplicationasitismoreprecisewiththeapplication.
Although sprayon sun care products are popular, there are rising concerns among
consumers about the dangers associated with the inhaling of the nano particles that
are released when these products are sprayed. However, companies, such as The
HonestCompany,AubreyOrganics,BaboBotanicals,andCaliforniaBabyhavestarted
offeringnanofreesuncareproducts.
Furthermore,aerosolsunscreenshavethedangerofcatchingfire,asevidencedinthe
productrecalloftheContinuousSpraylinefromBananaBoatinOctober2012.InNorth
America,in2012,atleastfivepeoplecatchfireafterapplyingtheproductwhenneara
flameorsparks.
Anotherconcernwithsprayonsuncareproductsisthatconsumersdonotuseenough
ofittoprovideenoughprotectionagainstthesun.
Althoughstillanichesegment,thereisrisingtrendamongmarketerstointroducesun
careproductsinupsidedownbottleswhichareknowntoenhancedispensabilityasthe
can does not have to be positioned at a particular angle while spraying the product.
Also,theyareconsideredtobemoreecofriendlyalternativestotopclosurebottles.
CoppertonesnewSportProSeriespackagingincludesaspraycanwithabagonvalve
packagingtechnologywhichseparatesthepropellantfromtheproductwithaMoritz
twisttolockactuator.
Bag on valves feature a 360 degrees continuous spray that does not allow any
duplication of the traditional sunscreen dispensing methods while the twisttolock
actuatorspermitasecurelockingfeatureforsafeportabilityoftheproducts.
However, consumers wary of the health dangers associated with the spray
formulationsareoptingforfoambasedproducts.
Suncareproductsinstickformats,isanotherpackagingformatgainingprominence.It
ismainlyusedforbabies.
Marketersincreasinglyintroducesuncareproductsforchildrenwithbrightandcolorful
packagingthatisappealingandattractivetochildren.
4A88
SunCareProducts
Each of Sunbows sun care products for children is designed with a different
Nickelodeoncharacteretchedonit.
Hawaiian Tropic presents its Silk Hydration Lotion Sunscreen, formulated with silk
ribbons,inclearbottlesforconsumerstoseethedualribbonformula.
As the industry shifts towards a more ecofriendly environment, there has been a
growingdemandforproductsfeaturingsugarcanebasedpolyethylenepackaging.
Inearly2012,Johnson&Johnsonintroducestheuseofsugarcanebasedpolyethylene
initspackagingwhichcontains60%bioplasticand40%recycledmaterialpackagingfor
itsSundownsuncareline.
ManystatesintheUnitedStatesareaimingtokeepteenagersawayfromindoortanning.
AsubstantialpopulationintheUnitedStatesmakesuseoftanningboothsinspiteof
warningsfrompublichealthagenciesabouttheirpotentialincausingskincancer.
AccordingtotheSkinCancerFoundation,researchshowsthatexposuretoUVradiation
fromartificialtanningmediumshasanincreasedeffectontheriskofmelanoma,the
mostdangerousformofskincancer.
California, Idaho, and Maryland in the United States have banned minors from using
indoortanning.
A proposal similar to the one above is being carefully considered in Arizona,
Connecticut, Florida, Iowa, Illinois, Michigan, Minnesota, North Carolina, New Jersey,
New York, Ohio, Oklahoma, Pennsylvania, Rhode Island, Washington, Vermont, and
WestVirginia.
Natural and organic products continue to gather momentum in the sun care products
category.
Increasing awareness about the inclusion of harmful chemicals contained in personal
care products makes many consumers opt for natural and organic products over
regularsuncareproducts.
Marketers,suchasJohnson&Johnsonareincreasinglyintroducingnaturalingredients
intheirproductschemicalformulationsinanattempttoenticeconsumerstopurchase.
Thereisagrowinginterestamongresearchanddevelopmentscientiststoresearchon
the ability of plants, algae, microorganisms, and coral that produce ingredients to
provideprotectionfromtheharmfuleffectsofthesun.
Therehavebeenprovenresultsfromscientistsacrosstheworldonnaturalingredients,
such as broccoli extracts, totara and manuka tree extracts, jojoba byproducts,
cordyceps fungus extracts, and turmeric to provide ultraviolet filters and protect the
skinfromsundamage.
In 2012, Energizer Holdings introduces the Banana Boat Natural Reflect Sunscreen
Lotion SPF 50+, Banana Boat Natural Reflect Kids Sunscreen Lotion SPF 50+, and
NaturalReflectbabySunscreenLotionSPF50+.
Yogurt is a key ingredient in Korres Sunscreen Face Cream Yoghurt. Yogurt contains
proteinsandlactosetokeeptheskincoolandsoft,helpsrelievesunburn,andincrease
themoisturelevelsintheskin.However,itisnotyetofferedintheUnitedStates.
Currently, there is no 100% natural sunscreen formulations that exists in the market,
and the closest approach to manufacturing a natural sunscreen is to use as many
naturalingredientsaspossible.
4G89
4G90
SunCareProducts
Suncareproductsmaketheirwayontoshelvesmuchinadvanceofthesummerseason.
With growing awareness, sun care products have begun to make their way to the
shelvesofretailersasearlyasspring.
However,theplacementofthesuncareproductsvariesaccordingtotheseason,with
mostbeingplacedateyelevelbesidefacialtreatmentproductsduringthesummerand
onlowershelvesduringwinter.
Althoughsuncareproductsareavailablethroughouttheyearatretailers,newproduct
introductionsfromcompaniesisprimarilywitnessedduringspring.
Marketersintroduceproductswithspecificbenefitsfordifferentsectionsofthesociety.
With the new U.S. Food and Drug Administration (FDA) rules and regulations on the
broad spectrum coverage, marketers are looking at ways of increasing their
competitivenessinthemarket.
Marketers,suchasMerckandEnergizerHoldings,introduceproductlinestargetinga
specific section of consumers, such as athletes, babies, children, and the aging
consumers.
In2012,Merckintroducestwoproductlines:theBananaBoatSportsProSeriesandthe
Banana Boat Wet n Clear line. The former line is specially designed for athletes who
undergo heavy sweating while the latter is a transparent, waterresistant, and
moisturizinglinethatbenefitschildren.
Marketersdiversifytheirproductofferingsasconsumersseekmultibeneficialproducts.
Manyconsumersbuymultifunctionalproductsthatinadditiontoprovidingprotection
against the sun provide benefits, such as skin lightening, antiaging, and make a
suitablebaseforcosmetics.
The BB creams, popular in 2012, are categorized as facial treatments, and many of
these are replacing womens sunscreens in daily usage. Moreover, consumers are on
thesearchforanSPFcreamforthefacethatislightweightandhasarefreshingfeeling
withoutleavingtheskinfeelingheavyorgreasy.
Marketers are also increasingly introducing primers with an SPF factor. Although
womenuseprimersandmakeuptocovertheirskinimperfections,thedailyexposure
tothesunandenvironmentalfactorscanfurtheraggravatetheproblem.
In 2012, LOral introduces the La Roche Posay Anthelios 50 AntiAging Primer with
Sunscreen.
Lipbalms,lipsticks,andlipglossescontaininganSPFfactor,isanotherpopulartrend,
asconsumersrealizetheimportanceofprotectingtheirlipsfromthedamagingsuns
rays.Theseproductsarecoveredintheirrespectivecategories.
In2012,afewlipbalmswithSPFformulationsareintroducedincludingAquaphorsLip
Repair+Protect,JackBlacksIntenseTherapyLipBalmSPF25,Chapfix,andSebamed
LipDefensewithSPF30.
Blurring of skin care products boundaries offset further growth in the sun care
productscategory.
Withtherisingdemandformultifunctionalproducts,marketershavebeguntolookto
sun protection as an advantage to be added to their multifunctional products
comprisingotherbenefitsaswell.
4A90
SunCareProducts
These multifunctional skin care products include benefits, such as antiaging,

moisturizingandnourishing,skinwhitening,andsuncareprotection.However,theSPF
factor in these products is much more diluted than a core sunscreen product and
thereforealotmorequantityisrequiredtobeappliedontheskininordertoprevent
damage from the suns harmful rays. Also, consumers do not have a tendency of
reapplyingtheseproductsandtherefore,remainsusceptibletoskindamage.
The rapidly growing mens skin care market also makes provisions for sun care products
specificallydesignedformen.
The mens skin care market which continues to grow significantly during 2012 also
offerssuncareproductsspecificallydesignedforthecoarseandroughskinofmen.
AfewvariantsinthiscategoryincludeAnthonyLogisticsforMensOilFreeFacialLotion
SPF15,JackBlacksIntenseTherapyLipBalmSPF25,MaryKaysMoisturizerSunscreen
BroadSpectrumSPF25,CliniqueforMensAgeDefenseHydratorBroadSpectrumSPF
15, Lab Series BB Tinted Moisturizer Broad Spectrum SPF 35, and Neutrogena For
MensTripleProtectFaceLotionwithSunscreenSPF20.
FDAsnewregulations,passedinmid2011,finallycomeintoeffect.
FDAsfinalregulationsforoverthecountersunscreenproductscomeintoeffectfrom
June18th,2012.However,toavertanyshortageoftheseproductsinthemarket,the
FDA extends the compliance dates for testing and labeling of these products to
December17th,2012forlargerbrands,andtoDecember2013forproductswithsales
oflessthan$25,000peryear.
According to the FDAs new regulations, companies manufacturing sun care products
willhavetopasstheUVAandUVBprotectiontestinordertoclaimBroadSpectrum
protectiononthelabel.
Previously, the rules for sun care products were only concerned with sunburn
preventionwhichismainlycausedbyUVBradiation,whichiswheretheSPFvaluation
isimportant.However,marketersdonottakeintoconsiderationUVAradiation,which
istheprimaryreasonforearlysignsofagingandskincancer.
Furthermore, under the law, marketers can only claim to reduce the signs of early
agingandtheriskofskincancerwithsuncareproductswithabroadspectrumSPF15
valueorhigherandwhenusedasperthedirectionsprovided.
Marketers sunscreen products with SPF values between 2 and 14 or not labeled as
broadspectrumarerequiredtowarnconsumerswithSkinCancer/SkinAgingAlert:
Spending time in the sun increases your risk to skin cancer and early skin aging. This
product has been shown only to help prevent sunburn, not skin cancer or early skin
agingastheyareonlyknowntoprovideprotectionagainstasunburn.
Companies can no longer make use of terms, such as, waterproof, sweat proof,
sunblock,andalldayprotection.InsteadtheFDAallowstheuseofwaterresistant
(40minutes)orwaterresistant(80minutes)dependingontheefficacyoftheproduct.
Manufacturerscannotclaimtheirsuncareproductstoprovideinstantprotectionon
applicationorprotectionformorethantwohourswithoutreapplication.
Itisrequiredofsunscreenproductstohaveadrugfactsinformationboxontheback
orthesideoftheproductpackaging,givingdetailedinformationabouttheproducts
ingredients.
TheFDAspropositionofcappingtheSPFvaluesonsunscreenproductstoSPF50isstill
aworkinprogresssincetherehasstillbeennoconclusiveevidenceabouttheefficacy
ofsuncareproductswithhighSPFvaluesincomparisontothosewithalowerSPF.
4G91
4G92
SunCareProducts
Salesofprivatelabelproductsgrow,butatalowerratesince2007.
Rising awareness about the criticalimportanceof good sun protection contributes to
thestrengthofnationalbrands.
Product pricing continues to be the key factor for some consumers, thereby exerting
pressureonthesalesvalueofnationalbrands.
Privatelabel products offer high profit margins to retailers and, hence, are heavily
backedbyretailersthemselves.
Notablenewproducts
Table4G35:SelectNewSunCareProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Ahava
Ahava
AfterSunBodyLotionisafaceandbodybalmthatisenrichedwithAhavaspatentedOsmoter,
minerals,vitamins,andnaturalmoisturizers
AustralianGold
AustralianGold
SheerCoverageContinuousSprayisformulatedwithInvisiDrytechnologythatquicklygets
absorbedbytheskinwithoutgivingastickyfeelingandbroadspectrumsunscreenprotection
thatisavailableinasprayformat.ItisanoilfreeformulawiththeAustralianGoldsignature
fragranceandiswaterresistantforupto80minutes.ItisavailableinSPF15andSPF30variants.
AustralianGold
AustralianGold
SheerCoverageFacesSPF45isformulatedwithnonoilyInvisiDrytechnologythatprovidesthe
facewithbroadspectrumsunscreenprotection.Itisdermatologicallytestedandisinfusedwith
theAustralianGoldsignaturefragranceandiswaterresistantforupto80minutes
AustralianGold
AustralianGold
SPF45SheerCoverageFaceswithSelfTannerisformulatedwithnonoilyInvisiDrytechnology
thatprovidesanaturalgoldenglowwhileprovidingbroadspectrumsunscreenprotection.Itis
dermatologicallytestedandisinfusedwiththeAustralianGoldsignaturefragranceandiswater
resistantforupto80minutes
AustralianGold
AustralianGold
SoothingAloeGelisinfusedwithvitaminAandE,andgreentea.Italsocontainsthenative
AustralianAcaciaextractswhichprovideantioxidantbenefitsandisinfusedwiththeAustralian
Goldsignaturefragrance
BananaBoat
SportPerformanceCoolzoneUltraMistContinuousSpraySunscreenprovidesbroadspectrum
UVAandUVprotectionandwaterresistanceforupto80minutes.ItisrecommendedbyTheSkin
CancerFoundationandisavailableinSPF30andSPF50variants.ThisisoneContinuousSpray
productnotrecalledin2012.
Energizer
Holdings
BananaBoat
NaturalReflectSunscreenLotionSPF50+isformulatedwithnaturallysourcedmineralsuncreeen
activesandzincoxideforUVAandUVBprotection.Itisoxybenzoneandparabenfree,gentleon
sensitiveskin,dermatologisttested,hasbeenproveneffectiveagainstsunburn,waterresistant
upto80minutes,andisrecommendedbyTheSkinCancerFoundation.Comesinvariantsfor
adults,babies,andkids
Energizer
Holdings
HawaiianTropic
SilkHydrationClearMistSprayoffersbroadspectrumUVAandUVBprotectionaccompaniedby
12hoursofmoisturization.Itisformulatedwithskinnourishingantioxidants,andis
recommendedbytheSkinCancerFoundation.ItisavailableinSPF15andSPF30variants
Energizer
Holdings
HawaiianTropic
SilkHydrationLotionSunscreenprovidesUVAandUVBprotectionand12hourmoisturization.It
isformulatedwithhydratingsilkribbonsforacontinuousinsunmoisture,nourishing
antioxidants,exoticbotanicals,andatropicalfragrance;andisavailableinSPF12,SPF30,and
SPF50variants
Aveeno
Protect+HydrateLotionSunscreenwithBroadSpectrumisacombinationofEnviroguard
TechnologyandActiveNaturalsOattoprovideUVAandUVBsunprotectionItisoilfree,non
comedogenic,sweatandwaterresistantforupto80minutes,andisavailableinSPF30,SPF50,
andSPF70variants
LaRochePosay
AntheliosUltraLightSunscreenLotionSpraywithCellOxShieldusesacombinationofpatented
sunfiltersandpowerfulantioxidantstoprotecttheskinevenatthecellularlevel.Itcomeswitha
360degreespraythatallowsforcontrolledapplicationoftheproduct,andoffersUVAandUVB
protection,availableinSPF30andSPF60variants
Energizer
Holdings
Johnson&
Johnson
LOral
(Continued)
4A92
SunCareProducts
Company
Brand
Description
LOral
LaRochePosay
Anthelios50TintedMineralUltraLightSunscreenFluidwithCellOxShield,offersUVAandUVB
protection(PFA21andSPF50).Itisa100%mineralformula,hasauniversaltinttechnologyfor
allskintones,andisclinicallyproven,fragrancefree,parabenfree,andwaterresistantforupto
40minutes
LOral
LaRochePosay
Anthelios50AntiAgingPrimerwithSunscreenoffersUVAandUVBprotection,andisinfused
withpowerfulantioxidantsforcorrectionofagingandtopreventthedailyagingcausedbysun
exposure
LOral
LOralParis
SublimeSunAdvancedSunscreenSPF50+LiquidSilkSunshieldforFacehasanexclusivepatented
UVfiltersystemwithaluxurioussheerformula.Infusedwithantioxidants,suchasvitaminEand
whitegrape
LOral
LOralParis
SublimeSunAdvancedSunscreenLotionsexclusivepatentedUVfiltersystemprovidessun
protectionwithaluxurioussheerformula,infusedwithantioxidants,suchasvitaminEandwhite
grapeItisavailableinSPF30andSPF50+variants
LOral
LOralParis
SublimeSunAdvancedSunscreenCrystalClearMistsexclusivepatentedUVfiltersystem
providessunprotectionwithaluxurioussheerformula.Infusedwithantioxidants,suchasvitamin
Eandwhitegrape,itisavailableinSPF30andSPF50+variants
LOral
LOralParis
SublimeSunAdvancedSunscreenSPF30HydraLotionSpraysexclusivepatentedUVfiltersystem
providessunprotectionwithaluxurioussheerformula.Infusedwithantioxidants,suchasvitamin
Eandwhitegrape
LOral
Vichy
CapitalSoleilSPF30LuxuriousProtectiveOilprovidesUVAandUVBprotection.Itis100%
transparentandisenrichedwithNaturalWhiteGrapeseedOilandvitaminE
Merck
Coppertone
SportProSeriesContinuousSpraySunscreenisformulatedwithDuraFlextechnologythat
providesUVAandUVBprotectionandiswaterresistantfor80minutes.Itisappropriateforacne
proneskin,andisavailableinSPF15,SPF30,andSPF50variants
Merck
Coppertone
WetnClearContinuousSpraySPF30providesUVAandUVBprotectionandiswaterresistantfor
upto80minutes.ItisdermatologicallytestedandisavailableinSPF30andSPF45+variants
Merck
Coppertone
WetnClearKidsContinuousSpraySPF45+providesUVAandUVBprotectionandiswater
resistantforupto80minutes
PanamaJack
PanamaJack
Products
AcceleratorSprayGelFullSunwithInstantBronzerisaninstantbronzerwithnosunscreenand
comesinabottlethatspraysfromallangles
PanamaJack
PanamaJack
Products
SunscreenSprayGelwithInstantBronzerisenrichedwithaloeandvitaminEandcomesina
bottlethatspraysfromallangles.ItisavailableinSPF4andSPF8variants
PanamaJack
PanamaJack
Products
SunscreenSprayGelisenrichedwithmoisturizersandthespraybottleworksatanyangle.Itis
availableinSPF15,SPF30,andSPF50variants
Sanofi
BullFrog
MosquitoCoastSPF30ContinuousSprayprovidesa2in1protectionagainstthesunandinsects,
andlastsupto8hours
Sun&SkinCare
Research
Margaritaville
ParrotHead
FloridaysMoisturizingSunscreenisenrichedwithaloehydratingcomplex300,olivesqualane,
andvitaminAandEforUVAandUVBprotection.Itiswaterresistantforupto80minutesandis
availableinSPF30andSPF50variants
Sun&SkinCare
Research
Margaritaville
ParrotHead
FloridaysFaceisanultralightsunscreenthatisenrichedwithaloehydratingcomplex500,olive
squalane,andvitaminAandEforUVAandUVBprotection.ItcontainsH2Omelonskinaging
defenseandiswaterresistantforupto80minutes
Sun&SkinCare
Research
Margaritaville
ParrotHead
FinsUpDryFeelSunscreenLotionwithWetSkinTechnologyiswaterresistantforupto80
minutes.Itisformulatedwithaloehydratingcomplex200andvitaminAandE,isfragrancefree,
andisavailableinSPF15andSPF30variants
Sun&SkinCare
Research
Margaritaville
ParrotHead
FinsUpDrySunscreenSpraywithWetSkinTechnologyisasunscreenlotion,infusedwithaloe
hydratingcomplex200andvitaminAandE,fragrancefree,andisavailableinSPF15,SPF30,and
SPF50variants
Sun&SkinCare
Research
Margaritaville
ParrotHead
ParakeetKidsHypoallergenicSunscreenForKidsSPF50isenrichedwithaloehydratingcomplex
200andvitaminAandE,andiswaterresistantforupto80minutes.Itisavailableinalotionand
sprayformat
(Continued)
4G93
4G94
SunCareProducts
Company
Brand
Description
Sun&SkinCare
Research
Margaritaville
ParrotHead
LicenseToChillIntensiveMoisturizingRepairLotionisenrichedwithH2OMelonskinaging
defense,aloehydratingcomplex1000,olivesqualane,andvitaminsA,CandE
Sun&SkinCare
Research
Margaritaville
ParrotHead
LicenseToChillCoolingAloeGelenrichedwithaloehydratingcomplex
Sun&SkinCare
Research
Margaritaville
ParrotHead
DedicatedToSunshineTanningOilSPF6withaloehydratingcomplex2000isarichblendof
tropicalbotanicalsincludingborage,hemp,brazilnut,andavocado
Sun&SkinCare
Research
Margaritaville
ParrotHead
DedicatedToSunshineTanEnhancerSPF8or15isanoilfreesprayongelwithaloehydrating
complex400,arichblendofbotanicalextractsincludingcalendula,chamomile,comfrey,and
carrotandantioxidants.
Salesbyproducttype
Sunblockscontinuetodominatethesuncareproductscategory.
Table4G36:ManufacturersSalesofSunCareProductsintheUnitedStatesbyProductType,2011and2012
$Million
Producttype
2011
Sunblocks(SPF15andover)r
%Oftotal
2011
2012
Change,%
594
648
60.4
61.8
9.1
Sunlesstanningproductsr
145
154
14.7
14.7
6.2
Sunscreens(SPF6toSPF14)r
114
118
11.6
11.3
3.5
Suntanningproducts(SPF5andunder)r
89
84
9.0
8.0
(5.6)
Aftersunandotherproductsr
42
44
4.3
4.2
4.8
984
1,048
100.0
100.0
6.5
4A94
2012
Totalr
rRestated.
SunCareProducts
Sunblocks(SPF15andover)
Sunblocksretaintheirdominanceinthesuncareproductscategoryin2012,withsalesat
$648million.
Manufacturerssalesadvance9.1%from$594millionin2011to$648millionin2012.
Newandinnovativeproductintroductionsandlineextensionsarethekeyreasonsfor
thehealthygrowthofthesegment.
In 2012, leading marketers, such as Energizer Holdings and Merck introduce new
technologicallyadvancedsunblockproductstotheiralreadyrobustproductofferings.
In2012,EnergizerHoldingsintroducestheHawaiianTropicSilkHydrationproductline
and Banana Boat Natural Reflect and Sport Performance Coolzone products while
MerckintroducestheCoppertoneSportsProSeriesandWetNClearrangeofproducts.
Consumers commonly believe that the higher the SPF value of a product, the more
protectiontheyprovideagainstthesun.However,theFDAhasproposedtolimit the
valueofSPFonsuncareproductstoSPF50,asthereisnosignificantdatatoprovethat
productswithSPFvaluesgreaterthan50offerbetterprotectionthanproductswithan
SPF50.
MarketersdemandhigherpricesforhigherSPFvaluedproducts.
Sunblocks have begun to gain preferential shelf space at retailers with most being
placedrightnexttofacialtreatmentproductsduringspringandsummer.
PrivatelabelproductsintroducehighSPFproductofferingsinanattempttocompete
with established national brands. However, the luxury brands are yet to explore the
segmentwiththeintroductionofhighSPFfactorproductofferings.
Since2007,salesofthesegmenthaveadvancedataCAGRof9.7%to$648million.
Table4G37:HistoricalManufacturersSalesofthe
SunblocksSegmentofSunCareProductsintheUnited
States,2007to2012
Year
$Millionr
Change,%
2007
408
2008
460
12.7
2009
478
3.9
2010
533
11.5
2011
594
11.4
2012
648
9.1
rRestated.
4G95
4G96
SunCareProducts
Sunlesstanningproducts
Manufacturerssalesofthesunlesstanningproductssegmentgrow6.2%in2012.
Salesadvancetoreach$154millionin2012,up6.2%from$145millionin2011.
Thesegmentcontinuestogainsalesduetoconsumerschoosingmoresunlesstanning
productsoversuntanningproducts.
AfewvariantsinthesegmentincludeHawaiianTropicsT2MaxIndoorTanningLotion,
Coppertones Gradual Tan Moisturizing Lotion, Banana Boats Summer Color Self
TanningMist,NeutrogenasBuildaTanGradualSunlessLotion,andLOrealsSublime
BronzeSelfTanningGel.
Since2007,saleshaveadvancedataCAGRof5.7%toreach$154millionin2012.
Table4G38:HistoricalManufacturersSalesofthe
SunlesstanningProductsSegmentofSunCareProductsin
Year
$Millionr
Change,%
2007
117
2008
131
12.0
2009
128
(2.3)
2010
140
9.4
2011
145
3.6
2012
154
6.2
rRestated.
Sunscreens(SPF6toSPF14)
Salesinthesunscreenssegmentadvance3.5%to$118millionin2012,from$114millionin
2011.
Althoughthesegmentpostsagrowthin2012,itcontinuestoloseshareinthesuncare
productscategory.
TheraceamongmarketerstointroducesuncareproductswithavaluehigherthanSPF
50,continues,therebyaffectingthesegmentsgrowthin2012.
A few variants in this segment include Hawaiian Tropics new Silk Hydration Lotion
Sunscreen SPF 12, Coppertones Continuous Spray SPF 10, and Panama Jacks
SunscreenOilSPF8.
A few leading brands, such as Banana Boat, Neutrogena, and LOral do not offer
productsinthissegment.
Since2007,saleshavegrownataCAGRof1.6%toreach$118millionin2012.
4A96
SunCareProducts
Table4G39:HistoricalManufacturersSalesoftheSunscreens
SegmentofSunCareProductsintheUnitedStates,2007to2012
Year
$Millionr
Change,%
2007
109
2008
112
2.8
2009
112
2010
115
2.7
2011
114
(0.9)
2012
118
3.5
rRestated.
Suntanningproducts(SPF5andunder)
The suntanning products segment continues to decline in 2012 with sales sliding to $84
millionin2012,down5.6%from$89millionin2011.
Therehasbeenashiftinthepreferencesofconsumersfromsuntanningproductsto
sunlesstanningproducts.
Growing awareness among consumers about the hazardous effects of the suns
harmful rays on the skin results in the shift of consumers to indoor sunlesstanning
products.
Moreover, suntanning products require the skin to be exposed to the sun after
application which can lead to signs of aging, wrinkles, freckles, blisters, skin
discoloration,andinafewcases,couldevenleadtoskincancer.
Some variants in this segment include Panama Jacks Spray Gel with Bronzer SPF 4,
Coppertones Continuous Spray SPF 4 Sunscreen, Hawaiian Tropics Tanning Crme
LotionSPF2,andBananaBoatsDeepTanningDryOilSPF4ContinuousClearSpray.
SalesofsuntanningproductshavedeclinedataCAGRof2.8%to$84millionsince2007.
Table4G40:HistoricalManufacturersSalesoftheSuntanningProducts
SegmentofSunCareProductsintheUnitedStates,2007to2012
Year
$Millionr
Change,%
2007
97
2008
101
4.1
2009
101
2010
101
2011
89
(11.9)
2012
84
(5.6)
rRestated.
4G97
4G98
SunCareProducts
Aftersunandotherproducts
Manufacturerssalesfortheaftersunsegmentpostagrowthof4.8%from$42millionin
Although the segment advances in 2012, it continues to lose share in the entire sun
careproductscategory.
Withgrowingawarenessabouttheharmfuleffectsofthesunsrays,manyconsumers
aremindfulofprotectingtheirskinandtherefore,takepreventivemeasuresnotonly
before going out in the sun but also with aftersun products, resulting in a growing
demandforsuchproducts.
AfewproductsavailableinthesegmentincludeHawaiianTropicsSilkHydrationAfter
Sun Lotion, Banana Boats Coolzone After Sun Aloe Gel with Lidocaine, and Panama
JacksGreenIceAloeGel.
However,leadingmarketers,suchasLOralandEsteLauderdonotfindapresencein
thisnichesegment.
Since2007,saleshaveadvancedataCAGRof3.0%to$44millionin2012.
Table4G41:HistoricalManufacturersSalesoftheAftersun
andtheOtherProductsSegmentofSunCareProductsinthe
Year
$Millionr
Change,%
2007
38
2008
40
5.3
2009
41
2.5
2010
44
7.3
2011
42
(4.5)
2012
44
4.8
rRestated.
4A98
SunCareProducts
COMPETITION
Bycompany
Table4G42:ManufacturersSalesofSunCareProductsintheUnitedStatesbyCompany,2011and2012
$Million
Company
2011
2012
EnergizerHoldings
217
230
Merck
176
Johnson&Johnson
%Oftotal
2011
2012
Changeinvalue,%
22.1
21.9
6.0
193
17.9
18.4
9.7
178
189
18.1
18.0
6.2
LOral
47
53
4.8
5.1
12.8
Sun&SkinCareResearchr
23
25
2.3
2.4
8.7
Privatelabelr
117
122
11.9
11.6
4.3
Allotherr
226
236
23.0
22.5
4.4
Totalr
rRestated.
984
1,048
100.0
100.0
6.5
EnergizerHoldingscontinuestobetheleadingmarketerinthesuncareproductscategory
in2012.
Manufacturerssalesofthemarketeradvancetoreach$230millionin2012,up6.0%
The marketers share in the entire category declines from 22.1% in 2011 to 21.9% in
2012.
EnergizerHoldingsmarksitspresenceinthecategorywithtwo ofitsbrands:Banana
BoatandHawaiianTropic.
BananaBoatdominatesthesuncareproductscategoryin2012,withsalesat$179million.
Manufacturers sales advance to $179million in 2012, up 6.5%, from $168million in
2011.
Thebrandmaintainsitsmarketshareinthecategory,accountingfor17.1%ofthetotal
categoryssalesin2012,flatfrom2011levels.
BananaBoatisalsotheleadingbrandinthemasstradeclass,accountingfor20.2%of
thetotaltradeclassshare.
Growth for the brand in 2012 is attributed to its new product introductions, brand
loyaltyfromconsumers,andincreasedemphasisonmarketingactivities.
The brands offerings include sunblocks, sunscreens, suntanning products, sunless
tanning, and aftersun and other products. However, its dominance is in the rapidly
growingandpopularsunblockssegment.
4G99
4G100
SunCareProducts
Most of the products introduced in 2012 contain high SPF formulations in order to
meetthegrowingdemand.
In 2012, Energizer Holdings introduces Banana Boat Sport Performance Coolzone
UltraMist Continuous Spray Sunscreen SPF 50, Banana Boat Sport Performance
Coolzone UltraMist Continuous Spray Sunscreen SPF 30, Banana Boat Coolzone After
Sun Aloe Gel with Lidocaine, Banana Boat Natural Reflect Sunscreen Lotion SPF 50+,
BananaBoatNaturalReflectKidsSunscreenLotionSPF50+,andBananaBoatNatural
ReflectBabySunscreenLotionSPF50+.
The popularity of sun care products for kids and babies induces the marketer to
introduceSKUsintheNaturalReflectlineforadults,kids,andbabiesalike.
BananaBoatoffersanarrayofproductsforkidsandbabiesinlotionandsprayformats.
AfewofthevariantsavailableincludetheKidsSPF110ContinuousClearSpray,Baby
TearFree SPF 50 Continuous Lotion Spray, Natural Reflect Kids Sunscreen Lotion SPF
50+, Baby SPF 100 Lotion, Kids SPF 50 Sunscreen Stick, and Kids SPF 50 Pump Lotion
FamilySize.
In October 2012, the brand voluntary withdraws 23 of its continuous spray products
whichareidentifiedtobeathreatduetothepotentialriskoftheproductsignitingon
theskin,whencomingincontactwithanignitingsourceiftheproducthasnotdried
offcompletely.
The products withdrawn include Ultra Mist Sport 15 Spray, Ultra Mist Sport SPF 30
Spray, Sport 30 Bonus Continuous Spray, Ultra Mist Ultra Defense SPF 30, Ultra Mist
UltraDefenseSPF30Bonus,FamilySizeSport30UltraMist,UltraMistSportSPF50,
UltraDefenseUltraMistSPF50,UltraDefense50BonusContinuousSpray,UltraMist
KidsSPF50Clear,Sport50BonusContinuousSpray,UltraMistSportPerformanceSPF
50+ Spray, Ultra Mist Ultra Defense 85 Spray, Ultra Mist Sport 85 Spray, Kids SPF 85
Spray,BonusUltraDefenseSPF85UltraMist,BonusSportSPF85UltraMist,SportSPF
30 Spray Twin Pack, Sport SPF 50 Spray Twin Pack, Sport 30 Ultra Mist 2 Pack with
Lotion&Lip,SportSPF30UltraMistwithSportLipBalm,Sport30UltraMist,andSport
SPF50UltraMist3Pack.
The company cites the reason behind the potential risk to be the product delivery
systemorthesizeofthevalve,whichdispensesmorethantheregularsuncarespray
and therefore takes longer to dry in comparison to other continuous sprays in the
market.
Manyofthebrandstanningoilsareenrichedwithnaturalingredients,suchascocoa
seed butter, banana fruit extract, carrot root extract, banana oil, grape seed oil, and
carrotandcoconutoil.TheDeepTanningSPF8Lotionwithgreenteaisenrichedwith
antioxidants.
A few of the brands aftersun and lip products are formulated with aloe vera and
vitaminEtoreplenishtheskinsmoistureandsoothesundamagedskin.
4A100
SunCareProducts
4G101
HawaiianTropic,theotherbrandofEnergizerHoldingswithwhichitcompetesinthesun
careproductscategory,continuestobethefourthleadingmassbrandinthecategory,with
salesat$51millionin2012.
HawaiianTropicpostsa4.1%growthwithsalesadvancingfrom$49millionin2011to
$51millionin2012.
Hawaiian Tropics growth in 2012 is accredited to the marketers introduction of the
highlyanticipatedSilkHydrationrangeofproductsandincreasedmarketingexposure
withitsfirsteverproductlinelaunchattheMercedesBenzFashionWeek.In2012,the
companyreceivesaTMEof$6.1million,withmostor$5.9millionbeingallocatedto
promotetheSilkHydrationproductline.
The Silk Hydration line comprises six SKUs: Silk Hydration After Sun Lotion, Silk
Hydration Clear Mist Spray SPF 15, Silk Hydration Clear Mist Spray SPF 30, Silk
Hydration Lotion Sunscreen SPF 12, Silk Hydration Lotion Sunscreen SPF 30, and Silk
Hydration Lotion Sunscreen SPF 50. The variants are enriched with hydrating silk
ribbons.
MerckdisplacesJohnson&Johnsontobecomethesecondleadingmarketerinthecategory
Thecompanyexperiencesahealthygrowthof9.7%from$176millionin2011.In2012,
Merckscategoryshareincreasesfrom17.9%in2011to18.4%in2012.
The companys growth in 2012 is due to the introduction of two new product lines:
SportsProSeriesdesignedforathletesandsportspersons,andWetnCleardesigned
forbabies.
TheCoppertoneWaterBabiesbranddoesexceptionallywellwithagrowthof18.8%to
postsalesat$19millionin2012,upfrom$16millionin2011.
As the awareness about the dangers of the UV rays among consumers increases,
parentsaretakingprecautionarymeasurestosafeguardtheirbabiesandkidsskin,as
aresultofwhichthekidsandbabiessegmentgarnersincreasedattention.
CoppertoneWaterBabies,apediatricianrecommendedbrand,offersproducts,suchas
QuickCoverLotionSpraySPF50Sunscreen,LotionSPF100+Sunscreen,FoamingLotion
SPF75+Sunscreen,andStickSPF55Sunscreen.
Johnson & Johnson slides down to become the thirdleading marketer in the sun care
productscategoryin2012.
Manufacturerssalestotal$189millionin2012,up6.2%from$178millionin2011.
Thecompanysshareslidebyamere0.1%from18.1%in2011to18.0%in2012.
Johnson & Johnson is represented by two major brands in the category: Neutrogena
andAveeno.
Neutrogenaisthethirdleadingbrandinthecategorywithsalesat$169millionin2012.
Thebrandshowsahealthygrowthof7.0%from$158millionin2011.
Thebrandsgrowthin2012ismainlyattributedtoitsexpandingdistributionnetwork,
good reputation in the market, and increasing marketing support from the parent
company,Johnson&Johnson.
4G102
SunCareProducts
Thecompanyslatestproductline,theWetSkinlinecomprisingsixSKUs,launchedin
2011continuestodowellin2012.
The brand also offers an array of multifunctional products offering benefits, such as
antiaging, moisturizing, and makeup. A few such products include Age DefenseAnti
Oxidant Moisturizer SPF 20, Healthy Skin AntiWrinkle Cream with sunscreen SPF 15,
Healthy Defense Daily Moisturizer with sunscreen Broad Spectrum SPF 50Sensitive
Skin,andVisibleEvenDailyMoisturizerBroadSpectrumSPF30.
Neutrogena also offers sun care moisturizers designed specifically for men. These
include Neutrogena Mens Triple Protect Face Lotion with sunscreen SPF 20,
NeutrogenaMensSensitiveSkinOilFreeMoisturewithsunscreenBroadSpectrumSPF
30,andNeutrogenaMensAgeFighterfaceMoisturizerwithSunscreenSPF15.
Johnson&Johnsonsotherbrandinthecategory,Aveeno,recordsalesat$20millionin
2012,flatfrom2011levels.
Followingadeclinein2011,Aveenorecuperatesitssalesin2012withthelaunchofits
newProtect+Hydratelineofproducts.
TheProtect+HydrateproductlinecomprisesthreeSKUs:LotionSunscreenwithBroad
SpectrumSPF30,LotionSunscreenwithBroadSpectrumSPF50,andLotionSunscreen
withBroadSpectrumSPF70.
ManufacturerssalesofLOralgrowatanaggressiverateof12.8%to$53millionin2012,
TheintroductionofLOralsSublimeSunisthekeyreasonbehindthestronggrowthof
thecompany.
The Sublime Sun product comprises six SKUs including Advanced Sunscreen SPF 50+
Liquid Silk Sunshield for Face, Advanced Sunscreen SPF 50+ Lotion, Advanced
Sunscreen SPF 30 Lotion, Advanced Sunscreen SPF 50+ Crystal Clear Mist, Advanced
Sunscreen SPF 30 Crystal Clear Mist, and Advanced Sunscreen SPF 30 Hydra Lotion
Spray.
The line is supported with a traceable media expenditure (TME) of $14.5 million in
2012.
In2012,LOralintroducesfournewSKUsforitsLaRochePosaybrand:Anthelios30
Ultra Light Sunscreen Lotion Spray, Anthelios 60 Ultra Light Sunscreen Lotion Spray,
Anthelios 50 Tinted Mineral Ultra Light Sunscreen Fluid, and Anthelios 50 AntiAging
PrimerwithSunscreen.
A new product, Capital Soleil SPF 30 Luxurious Protective Oil, is added to Vichy
Laboratoriesexistinglineofproductsin2012.
4A102
SunCareProducts
Sun&SkinCareResearchsmanufacturerssalesadvance8.7%from$23millionin2011to
$25millionin2012.
The company is represented in the category by its No Ad, Ocean Potion, and
MargaritavilleParrotHeadbrands.
NoAdgrows10.0%to$11millionin2012,upfrom$10millionin2011.
ThemanufacturerssalesforOceanPotiongrow7.7%torecordsalesat$14millionin
In 2012, the company introduces its Margaritaville Parrot Head brand comprising 10
products:FloridaysMoisturizingSunscreen,FloridaysFace,FinsUpDryFeelSunscreen
Lotion, Fins Up Dry Sunscreen Spray, Parakeet Kids Hypoallergenic Sunscreen Lotions
ForKidsSPF50,ParakeetKidsHypoallergenicSunscreenSprayForKidsSPF50,License
ToChillIntensiveMoisturizingRepairLotion,LicenseToChillCoolingAloeGelenriched
withaloehydratingComplex,DedicatedToSunshineTanningOilSPF6,andDedicated
ToSunshineTanEnhancerSPF8.
PRIVATELABEL
Privatelabelsalesofsuncareproductshavepositivegrowthin2012.
Salesincrease4.3%from$117millionin2011to$122millionin2012.
Althoughthepopularityofprivatelabelwasdrivenbytherecession,itremainspopular
withsomeconsumerswhoarecontentwiththequalityandefficacyoftheseproducts.
There is still a section of the society who does not wish to splurge on these kinds of
products,thereby,optingforlessexpensiveprivatelabelproducts.
Moreover,overaperiodoftime,privatelabelproductshavebecomewidelyavailable
acrossmostmassdistributionchannels.Suchproductsoccupyprominentshelfspace,
right next to established brands, thereby making it easier for consumers to make a
comparisonwithrespecttoprices,packaging,formulations,andingredients.
RETAILDISTRIBUTION
Mass merchandisers retain the leading position as the preferred retail channel of
distribution.
Massmerchandisersconstitute42%oftotalretailsales,constantfrom2011levels.
Drugstoresremainalmoststableinsecondposition,accountingfor30%oftotalretail
sales.Thereisaslightdecreasenotshownbecauseofrounding.
Food stores continue to be in the thirdleading position with a contribution of 12%
towardsthetotalcategorysalesin2012.
Shareofthedirectsaleschannelsinthecategoryreducesslightlyin2012dueto the
decliningandstagnantsalesofdirectsalescompanies,suchasAvonandMaryKay.
Ontheotherhand,shareofdepartmentstorestowardsthecategoryssalesincreases
from5%in2011to6%in2012.
4G103
4G104
SunCareProducts
Table4G43:ManufacturersSalesofSunCareProductsinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
42
42
Drugstores
30
30
Foodstores
12
12
Departmentstores
Directsales
Specialtystores
100
100
Total
MARKETINGACTIVITY
TMEforthesuncareproductscategorydeclines2.5%to$79.5millionin2012from$81.5
millionin2011.
Television advertisement is the most popular advertising medium of the category,
followedbymagazineadvertising.Collectively,theyrepresentalmost75%ofthetotal
suncareproductcategorysTMEin2012.
In 2012, expenditures on television and magazine advertisements account to $46.1
millionand$27.7million,respectively.
Marketers in the sun care products category organize events to create awareness about
theharmfuleffectsofprolongedexposuretotheUVraysontheskin,theintroductionof
newproducts,andextensionofexistingproductlinesamongconsumers.
Neutrogena teams up with actress Gabrielle Union to advise and advocate people to
makeskincancerpreventionapartoftheirdailyroutine.Skincancerisatypeofcancer
thatispreventableandNeutrogenaistryingtoeducateconsumersaboutthecommon
sunprotectionmyths,andspreadawarenessthatskincanceroccursirrespectiveofa
personscolor.
In 2012, Hawaiian Tropic sponsors the Mercedes Benz Fashion Week Swim 2013
Collectionsrunwaytopromoteitslatestrangeofsuncareproducts,theSilkHydration
line.
Following its annual tradition since 2008, The Skin Cancer Foundations Road To
Healthy Skin Tour which is presented by Aveeno and Rite Aid in conjunction makes
approximately85stopsacross27statesduringtheperiod,MarchthroughSeptember.
Aveeno uses this Tour to highlight its Be An Active Natural Fund which has been
established with the aim of inspiring people and organizations to realize the spirit
behindActiveNatural.Duringtheyear,Aveenoissaidtoaward$300,000ingrantsto
theSkinCancerFoundationandindividualswhoseeffortsbringaboutchangesinone
andtheworldaroundthem.
4A104
SunCareProducts
LOral holds a press event in 2012 at its headquarters in New York to educate
consumersthatpeopleofcolorarenotimmunetomelanomaandotherskindiseases
assunexposurerisksaffectsalltypesofskincolors.
In2012,BananaBoatcollaborateswithChipGanassiRacingTeamsforthe2012IZOD
IndyCarSeriesracingseason.Accordingtothepartnership,twotimeIndianapolis500
winnerDarioFranchittidrivesaBananaBoatbrandthemedcarintheseasonopening
GrandPrixofSt.Petersburg.FranchittiadornstheBananaBoatbrandlogoonhisfire
suitthroughoutthe2012season.Thebrandalsohostsaneventtracksidewherebyfans
can come to the Banana Boat CoolZone Sunscreen Pit Stop and use new sunscreens,
playgames,andreceiveproductsasgiveaways.
Sponsorshipactivityhelpsdrivegrowthinthesuncarecategory.
Theprimarygoalofthesesponsorshipactivitiesincludepromotingnewproductsand
lineextensionsfromestablishedandstartupcompanies,educateconsumersaboutthe
attributesoftheproducts,andgatherretailplatformsforpromotionalactivities.
Marketersemploybroadertacticsofincludingthemeparks,NASCARteams,andother
activitieswhereconsumersspendaconsiderableamountoftimeinthesun.
Coppertone uses its partnership with Six Flags to promote the Sports Pro Series and
Wet N Clear product lines. The partnership provides the brand a platform and an
environmenttocommunicatetochildrenandadultstheimportanceofprotectingtheir
skinfromthesunsrayswhiletheyareoutdoors.
Sun care marketers continue to focus on social media activation efforts, to spread
awarenessaboutthebrandsandnewproductintroductions.
Socialnetworksites,suchasFacebookandTwitterareoftenutilizedtopublicizenew
productintroductions.
ActivebrandsonFacebookincludeBananaBoat,Coppertone,andNeutrogena.
In2012,CoppertoneholdsacontestonitsFacebookpagetofindthenextLittleMiss
Coppertoneinanefforttogivethebrandsadvertisingcampaignanewandmodern
lookbyrekindlinginterestinthelittlegirlandthedogaCoppertonesymbolsince1953.
ThecontestispromotedinanumberofwaysincludinganadvertisementinthePeople
magazine for the Coppertone Ultra Guard sunscreen spray that is portrayed with a
scratchandsnifffeaturewhichreleasesthetrademarkCoppertonescent.
HawaiianTropicactivatestheMercedesBenzFashionWeekSwimthrough,aFacebook
promotionthatallowsparticipantstowinatriptotheevent.
Banana Boat promotes the Chip Ganassi Racing with a branded Facebook tab that
offerstipsonmusicandoutdoorgearfromDarioFranchittiandJamieMcMurray.
4G105
4G106
SunCareProducts
Suncaremarketerslookforretailpromotionalplatformsandonsitesalesrightstopromote
theirbrandsandproductlines.
CoppertoneactivatesSixFlagswithinstantredeemablecouponsthatofferconsumers
$40.00discountonpassesforparticipatingthemeparks.
Panama Jack acquires the sales rights on its partnerships with Hersheypark and
SeaWorldParks&Entertainment.
Afewleadingmarketers,suchasEnergizerHoldings,Merck,andJohnson&Johnson,adopt
marketing techniques, such as special offers including giveaways, sweepstakes, and
discountcoupons.
BananaBoats101DaysofSummerinitiativeisdesignedtogetfamiliesoutdoorsto
play. Each time a parent takes the Banana Boats Facebook pledge to play with their
kidsoutdoors,thecompanydonatesabottleofsunscreen(upto10,000bottles)tothe
Hole in the Wall Gang, a camp founded by Paul Newman for children coping with
cancerandseriousillnesses.
Most of the leading sun care brands offer discounts and coupons to promote their
brands.
Johnson&Johnsonremainstheleadingadvertiserinthesuncareproductscategoryin2012
inspiteofasteepdeclineinitsmediaspending.
The companys entire TME is estimated at $20.2 million in 2012, down 37.4% from
$32.1millionin2011.
Television and magazine advertisements are the preferred marketing mediums
adoptedbythecompany.
Johnson&Johnsonallocates56.4%ofthetotalTMEtotelevisionadvertisementsand
39.1%ofthetotalTMEonmagazineadvertisements.
The companys entire TME is allocated to its Neutrogena brand with the advertising
expendituredeclining20.0%fromapproximately$25millionin2012toapproximately
$20millionin2012..
Neutrogenas Ultra Sheer sun block receives most of the brands TME in 2012, at
$10.5million.
EnergizerHoldingsretainsitspositionasthesecondlargestadvertiserinthecategorywith
aTMEof$19.5millionin2012.
ThemarketerincreasesitsTMEby8.3%from$18millionin2011.
Thecompanyallocates$13.4milliontopromoteitsBananaBoatbrand.BananaBoat
Coolzonesprayreceivesthehighestadvertisingspend,at$6.7million.
Thecompanysotherbrand,HawaiianTropic,isallocatedaTMEof$6.1millionin2012.
4A106
SunCareProducts
4G107
MerckisthethirdlargestadvertiserinthecategorywithTMEof$17.6millionin2012.
Coppertone, the companys popular sun care brand receives the entire amount
allocatedasTME.
The marketer apportions $7.4 million to promote the Coppertone Wet n Clear Spray
and$6.4milliontopublicizeCoppertonesSportProSeries.
OUTLOOK
The sun care products category is expected to post strong growth during the forecast
period,2012to2017.
The introduction of the FDAs longawaited sunscreen monograph, will stimulate the
categoryintheforecastperiod.
Growth of the sun care products category will be driven by new product activity,
improvedformulations,innovations,andanincreaseinthepricepointsoftheproducts.
Mediareportsandarticlespublishedbyagencies,suchastheSkinCareFoundationand
marketersaboutpropersuncarewillallowthecategorytoaddnewconsumerseach
year.
TheintroductionoftheFDAslongawaitedsunscreenmonographwillinducenewinterest
inthecategoryduringtheforecastperiodthrough2017.
Newregulationsonproductlabelingandformulationshavebeenforcedintoeffectin
December2012,andarelikelytoleadtoeffectivechangesduringthecomingyears.
TheFDAisexpectedtocomeupwithadecisionfortheproposedruleoflimitingthe
SPFto50,therebychangingthewayconsumersperceivehigherSPFproducts,andalso
altering the product offerings of marketers. This would require marketers to
reformulatesomeoftheirproductofferingstobringdowntheleveloftheirSPFclaims.
Itwouldalsocauseconfusioninthemarketplaceassomeconsumerswouldsearchin
vainforhigherSPFproducts,therebydelayingpurchases.
Theabovewouldeventuallyhelpincreaseconsumerconfidenceinpurchasingsuncare
products,afterthechangesarebetterunderstoodbyconsumers.
4G108
SunCareProducts
Naturalandorganicformulationswillcontinuetogainattentioninthecategory.
Organicproductshavealreadycreatedabuzzacrossallmajorproductcategories,and
thesuncareproductcategoryisnoexception.
Gradually,marketerswillintroducesuncarelinesformulatedwithnaturalingredients,
eliminatingsomeperceivedharmfulchemicalsfromtheirregularsuncareformulations.
These natural products will continue to command higher prices in comparison to the
regularchemicallyformulatedsuncareproductsandthereby,contributetotheoverall
categorysvaluegrowth.
Thesuncareproducts,however,cannotguaranteea100%naturalformulationasthe
complexity of the formulations makes it necessary for the manufacturers to include
syntheticchemicalingredients.
Future success of natural sun care products will depend on the ability of the
manufacturerstodevelopanddiscovervariednaturalandorganicingredientsforsun
careproducts.
Thereisalwaysalargeconsumerbasefortanningproducts;however,consumersare
expectedtoshifttothesaferoptionofindoortanningorresorttotheuseofsunless
tanningproducts,withoutactuallyexposingonesskintothesun.
Sunlesstanning products and spraytanning products will continue to gain popularity
through2017.
Marketers are expected to continue to support their product lines with significant
promotionalandadvertisingsupport.
Marketerswillnotletgooftheopportunityofincreasingawarenesstowardskincancer
andskinprotection.
Efforts will be directed towards increasing awareness on skin cancer and skin
protectionandonfollowingaproperskincareregimen.
There will be an increase in the number of public health campaigns organized by
variousorganizationsandcompaniestoincreaseconsumerawarenessaboutsuncare
protectionandthevariousproductsavailableinthemarket.
Innovationswillallowthecategorytogarnergoodsalesduringtheforecastperiodending
2017.
Research and development will continue to play a key role for the category as
marketers will look to innovate with product formulations, establish patented
technologies,addmultifunctionalbenefits,andincreasethelevelofprotectionagainst
theUVraysforitsproducts.
Thedemandforsuncareproductsofferingantiaging,skinnourishing,brightening,and
whiteningbenefitswillcontinuetogrow.
MarketersareexpectedtointroducesuncareproductswithhighSPFwithappropriate
cosmeticpropertiesandtextures.Theseproductswillapparentlydemandhigherprices
fromconsumersallowingforthecategorysdollarsalestogrow.
4A108
SunCareProducts
The category is expected to witness an increase in the prices of the products due to new
andimprovedproductformulationsinaccordancewiththenewFDAregulations.
Marketers are expected to demand higher prices for their sun care products due to
improved formulations, use of advanced technology, and availability in convenient
formats.
Thepricesoftherawmaterialsareexpectedtograduallyincreaseinthenextfiveyears.
The blur between the skin care and sun care products is expected to have a detrimental
effectonthesuncarecategorysgrowthduringtheforecastperiod.
SPFisbecomingthenorminalmostallskincareandmakeupformulations.
Thereisalikelihoodofshiftindemandfromcoresuncareproductstoskincareand
makeupproductsofferingaSPFadvantagewhichprovidemultiplebenefitsinasingle
product.
Additionally, the skin care and sun care products are expected to merge in the
followingyearsmakingitdifficultforbrandshavingapresenceinboththecategories
to balance their sales between the two categories of products without having a
negativeeffectontheother.
Suncaremarketersarefacedwiththerisingchallengeofconvincingconsumerstouse
coresunscreensratherthanproductsofferingmultibenefits,suchasfoundationsand
primersthathavenowbeguntoofferasunprotectionfactor.
Privatelabelproductswillcontinuetogrowthrough2017,butnotatthefastrateofrecent
years.
Inordertomatchuptothelevelsofthenationalbrands,privatelabelmarketerswill
continuetoinnovateandspendincreasedcapitalontheresearchanddevelopmentof
products.
Thereisapossibilityofprivatelabelproductstoalsointroducenaturalandorganicsun
careproductssoastogivestiffcompetitiontowellestablishednationalbrands.
Manufacturers sales of sun care products are forecast to grow at a CAGR of 7.1% from
Thesunblocksegmentwillbethekeydriverfortheentirecategoryssalesgrowth.
UnitvolumeisprojectedtoadvanceataCAGRof6.4%to334.0millionpackagesin2017,up
4G109
4G110
SunCareProducts
Table4G44:ForecastManufacturersSalesofSunCareProductsintheUnitedStates,2012
to2017
$Million
Producttype
2012
2017
CAGR,%
Sunblocks(SPF15andover)
648
955
8.1
Sunlesstanningproducts
154
221
7.5
Sunscreens(SPF6toSPF14)
118
152
5.2
Suntanningproducts(SPF5andunder)
84
81
(0.7)
Aftersunandotherproducts
44
71
10.0
1,048
1,480
7.1
Total
4A110
4H.OTHERTOILETRIES
INTRODUCTION
Includedinthissectionarethefollowingproducts,whicharenotcategorizedinanyother
sectionofthisreport:
Shavingproducts
Thepersonalcleansingproductscategorycoversbarsoaps(bothcommodityandspecialty),
bathadditives,liquidsoaps,bodywashes,andantibacterialhandgels.
Thebathadditivessectioncoversbothchildrensandadultbathadditives.Infantbath
additivesarediscussedseparatelyinthebabycareproductscategory.
The shaving products category includes shaving gels, creams, and preshaves only,
excludingrazors.
MANUFACTURERSSALES
Manufacturerssalesoftheothertoiletriesproductclassareestimatedat$6,602millionin
2012,up3.0%from$6,412millionin2011.
Personal cleansing products continues to be the leading product category in the
productclass,withsalesat$4,026millionor61.0%oftotalproductclasssalesin2012.
Deodorants and antiperspirants follow as the secondlargest product category,
accountingfor30.9%oftotalproductclasssalesin2012.
Collectively, the top two product categories represent almost 92% of total product
classsalesin2012,downmarginallyfrom92.1%oftotalproductclasssalesin2011.
4H2
OtherToiletries
Figure4H1:ManufacturersSalesofOtherToiletriesintheUnitedStates,2012
Depilatories,
waxes,and
bleaches,2.5%
Personalcleansing
products,61.0%
Shavingproducts,
5.6%
Deodorantsand
antiperspirants,
30.9%
Total:$6,602 Million
NOTE:Totalsmaynotaddupduetorounding.
Historicalsales
Since 2007, sales in the other toiletries product class have grown at a compound annual
growthrate(CAGR)of2.5%toreach$6,602millionin2012.
Table4H1:HistoricalSalesofOtherToiletriesinthe
Year
$Million
Change,%
2007
5,823
2008
5,948
2.1
2009
6,076
2.2
2010
6,217
2.3
2011
6,412
3.1
2012
6,602
3.0
Salesbytradeclass
Themasstradeclasscontinuestobethelargesttradeclassintheothertoiletriesproduct
classin2012.
Themasstradeclassrepresentsbulkofthetradeclasssalesat89.8%in2012.
Thespecialtytradeclassfollowsinthedistantsecondplacewith7.6%ofsalesin2012.
The direct trade class is the thirdleading trade class representing 1.8% share of the
salesin2012.
The luxury trade class accounts for 0.8% of the total product class sales, while the
professionaltradeclasshasnegligiblepresenceintheproductclasssalesin2012.
4A2
4H3
OtherToiletries
Table4H2:Manufacturers'SalesofOtherToiletriesintheUnitedStatesbyTradeClass,2012
$Million
Deodorantsand
antiperspirants
Depilatories,waxes,
andbleaches
Personal
cleansing
products
Shaving
products
Total
%Of
total
2,029
163
3,396
340
5,928
89.8
493
11
504
7.6
Direct
11
102
118
1.8
Luxury
35
17
52
0.8
Professional
2,040
163
4,026
373
6,602
100.0
Tradeclass
Mass
Specialty
Total
RETAILSALES
Total retail sales of the other toiletries product class are estimated at a rounded
$9,469millionin2012,up3.0%fromarounded$9,191millionin2011.
COMPETITION
Table4H3:ManufacturersSalesofOtherToiletriesintheUnitedStatesbyCategoryandCompany,2012
$Million
Company
Personalcleansing
products
Deodorantsand
antiperspirants
Shaving
products
Depilatories,waxes,
andbleaches
Total
%Of
total
Unilever
1,134
755
1,892
28.7
Procter&Gamble
385
687
95
19
1,186
18.0
ColgatePalmolive
464
172
636
9.6
Henkel
430
135
565
8.6
LimitedBrands
409
409
6.2
EnergizerHoldings
166
166
2.5
Johnson&Johnson
115
16
131
2.0
66
45
111
1.7
BrynwoodPartners
88
94
1.4
Avon
81
11
92
1.4
920
208
93
99
1,320
20.0
4,026
2,040
373
163
6,602
100.0
Church&Dwight
Allother
Total
4H4
OtherToiletries
The top five marketers in the other toiletries product classUnilever, Procter& Gamble,
ColgatePalmolive, Henkel, and Limited Brandsrepresent over 71.0% share of the other
toiletriesproductsclasssalesin2012.
ThetoptwomarketersUnileverandProcter&Gambleregistersalesofmorethan
$1,000millioneachin2012,whileColgatePalmoliveandHenkelatthethirdandfourth
position,respectively,registersalesofmorethan$500millioneach.
Unilever continues to be the leading marketer in the other toiletries product class, with
salesat$1,892millionin2012.
Salesgrow4.6%from$1,809millionin2011.
Unilevers share in the other toiletries product class increases from 28.2% of total
product class sales in 2011, to 28.7% of total product class sales in 2012. The
marketersgrowthintheproductclassisduetoitsgoodperformanceinthepersonal
cleansingproductsanddeodorantsandantiperspirantscategories.
Unilever continues to be the largest marketer of personal cleansing products with
28.2% of the total categorys sales in 2012. Sales of the marketer grow 4.0% to
$1,134millionin2012,from$1,090millionin2011.
Unilevercontinuestodominatethebarsoapsandthebodywashessegmentsin2012,
withadistinctlead.
Bar soaps is the largest segment for the marketer, representing 52.2% of Unilevers
totalcategorysalesin2012.
Bodywashes,thesecondleadingsegmentforthemarketer,accountsfor47.4%ofthe
marketerssalesin2012.
Sales for the marketer are supported by a varied product portfolio, moderate new
product introductions, and a considerable Traceable Media Expenditure (TME) of
$85.2millionin2012.
Doveistheleadingbrandforthemarketerwithsalesup5.9%to$680millionin2012,
Dove continues to hold leadership positions in the bar soaps and body washes
segments.
DoveisallocatedaTMEof$64.5millionin2012.
Unilever also continues to be the leading marketer in the deodorants and
antiperspirants category in 2012. The marketers sales total $755million in 2012, up
Thecompanysmarketshareinthedeodorantsandantiperspirantscategoryincreases
from35.8%in2011to37.0%in2012.
UnileverspresenceinthecategoryisthroughitsDegree,Dove,Axe,andSuavebrands.
Degree is the leading brand for Unilever and the secondleading brand in the
deodorantsandantiperspirantscategorywithsalesadvancing4.3%to$265millionin
The brand represents 35.1% share of the marketers sales in the deodorants and
antiperspirantscategory.
The brand sustains its growth with its loyal consumer base and product offerings for
both,menandwomen.
4A4
OtherToiletries
In 2012, sales of Degree are supported by the expansion of the womens Expert
Protection, Clinical Protection, and Nature Effects Invisible Solids product lines with
theLinenDry,CottonFresh,andAbsorbentSeaSaltsvariants,respectively.
In 2012, the marketer also revolutionizes its Degree Men Adrenaline Series with
motionsense technology. The technology is composed of motionactivated micro
capsules that provide extra protection to combat extra sweat and odor. The Degree
Men Adrenaline Series with motionsense technology comprises variants including
Adventure,Extreme,Everest,SportDefense,andV12.
In2012,UnilevertakesamajorstepbyintroducingtheAxeAnarchy,thefirstfragrance
in the brands history targeting both men and women. The body spray is allocated a
TME of $22.9million in 2012, the highest for the brand among any of its deodorants
andantiperspirantsin2012.TheAxeAnarchyForHerisalimitededitionproduct,with
the marketer waiting to see the response that the market has for the brands first
femaleorientedproduct.
Procter& Gamble remains the secondlargest marketer of other toiletries, with

$1,186millioninsalesduring2012,up2.1%from$1,162millionin2011.
Procter& Gambles share in the product class declines marginally from 18.1% of the
totalproductclasssalesin2011to18.0%oftotalproductclasssalesin2012.Procter&
Gambles growth in the other toiletries product class is mainly due to good
performance of the Olay brand in the depilatories, waxes, and bleaches and the
shaving products categories. However, the marketers share in the product class
declines marginally as a result of the stable sales in the large personal cleansing
product category and a marginal growth in the deodorants and antiperspirants
category.
Thedeodorantsandantiperspirantscategoryisthelargestcategoryforthemarketerin
theothertoiletriesproductclassin2012.Themarketerexperiencesamarginalgrowth
of0.7%toreach$687millionin2012,upfrom$682millionin2011.
Thecompanysshareinthedeodorantsandantiperspirantscategoryfallsfrom34.1%
in2011to33.7%in2012.
Procter & Gamble is present in the category with its Secret, Old Spice, and Gillette
brands.
Secret continues to be the leading brand for the marketer in the deodorants and
antiperspirantscategoryin2012.Manufacturerssalesofthebrandareupmarginally
by0.6%tototal$350millionin2012,upfrom$348millionin2011.Secretscategory
share declines marginally by 20 basis points to 17.2% in 2012, from 17.4% of total
Procter&GamblesTMEsupportforSecretincreases4.5%from$39.9millionin2011
to $41.7million in 2012, with Secret Clinical Strength and Secret Outlast being
allocated the maximum TME at $18.8million and $22.5million, respectively. In 2012,
the marketer introduces the Secret Outlast in Invisible Solid, Clear Gel, and Smooth
Solid variants. To promote the Secret Outlast Collection, Procter & Gamble partners
withJenniPulos,atelevisionpersonalityandactress,tohelpconsumersconquertheir
hecticworkscheduleswhiletheproductprovidesthemwith48hourodorprotection.
4H5
4H6
OtherToiletries
SalesofProcter&Gambleinthepersonalcleansingproductscategoryremainstableat
$385millionin2012,flatfrom2011levels.
Bodywashesisthelargestsegmentforthemarketerinthepersonalcleansingproducts
category in 2012, and is the secondleading marketer in the body washes segment,
accounting for 18.5% of the segments sales in 2012. The marketers sales in the
segmenttotal$251millionin2012,up3.3%from$243millionin2011.
Procter&Gambleisthethirdlargestmarketerinthebarsoapssegment,representing
33.5% of the marketers sales in 2012, down from 35.1% in 2011. The decline in the
marketers share in the segment is due to the poor performance of Olay, Ivory, and
Safeguard.
The marketers decline in sales in the bar soaps segment is because TME declines
approximately 70.0% from $114.1million in 2011, to $40.0million in 2012. The
marketer experiences a considerable decline in sales for its Old Spice and Gillette
brands.
Procter&Gamblecontinuestobethesecondleadingmarketerintheshavingproducts
category in 2012. Manufacturers sales reach $95million in 2012, up 4.4% from
$91millionin2011.
Themarketshareforthecompanyintheshavingproductscategoryincreasesto25.5%
in2012,upfrom25.1%in2011duetotherapidlyexpandingTheArtofShavingbrand.
Procter&Gamblesleadingbrand,Gilletteexperiencesa2.4%growthfrom$82million
In early 2012, the marketer introduces the Gillette Fusion ProGlide Clear Shave Gel.
Furthergrowthforthebrandisoffsetbyincreasingcompetitionfromotherbrandsin
themarketincludingSchick,Edge,andNiveaforMen.
Procter & Gambles Olay records an enormous growth at 375.0% in the depilatories,
waxes, and bleaches category in 2012. Manufacturers sales for the brand advance
from$4millionin2011to$19millionin2012.
Thecompanysmarketshareincreasesfromamere2.8%in2011to11.7%in2012.
In 2012, the marketer introduces the Smooth Finish Facial Hair Removal Duo for
Medium to Coarse Hair after the success of the initial launch of the Smooth Finish
FacialHairRemovalDuoforFinetoMediumHairin2011.
SalesforOlaybenefitsfromastrongdistributionmodelanditsproductsareavailable
acrossallmajorretailmasschannelssuchasWalmart,Walgreens,andCVS/Pharmacy.
The brand has a higher price point than competing products because of the trusted
Olayname,whichalsocontributestothesteepdollarincreaseinsales.
4A6
OtherToiletries
ColgatePalmolivecontinuestobethethirdleadingmarketerintheothertoiletriesproduct
classwithsalesat$636millionin2012,up2.3%from$622millionin2011.
The marketer represents 9.6% of total product class sales in 2012, down marginally
from9.7%oftotalproductclasssalesin2011.
Personal cleansing products is the largest category for the marketer in the other
toiletries product class in 2012. The marketer is the secondleading marketer in the
category,with11.5%ofthetotalpersonalcleansingproductscategoryssalesin2012,
flat from 2011 levels. Sales total $464million in 2012, up 3.6% from $448million in
2011.
ColgatePalmolive is the leading marketer in the liquid soaps segment and fourth
largestmarketerinthebodywashesandbarsoapssegmentsduring2012.
Theliquidsoapssegmentrepresents46.3%ofthetotalmarketerssalesinthepersonal
cleansing products category in 2012. Sales of the marketer in the segment increase
Growthofthemarketerisdrivenbynewproductintroductionsandgoodperformance
intheliquidsoapssegmentin2012.
The bar soaps segment of the marketer witnesses the highest growth in sales during
2012.Salesadvance8.5%to$127millionin2012,upfrom$117millionin2011.
Sales of the marketer in the body washes segment remain stable at $122million in
ColgatePalmoliveisthethirdleadingmarketerinthedeodorantsandantiperspirants
category in 2012. Manufacturers sales decline 1.1% to $172million in 2012, from
$174millionin2011.Themarketeraccountsfor8.4%oftotalcategoryssalesin2012,
downfrom8.7%in2011.Themarketersshareinthecategoryhasbeendecliningsince
2011.
ColgatePalmolive is represented in the category by Speed Stick, Lady Speed Stick,
TomsofMaine,andTeenSpirit.
Sales of Speed Stick, the flagship brand of the marketer in the deodorants and
antiperspirantscategorydecline1.0%from$97millionin2011to$96millionin2012.
The brands sales decline in spite of the launch of the new product line Speed Stick
Power in 2012. The product line contains four variants in the solid form and two
variantsinthegelform.Tolaunchtheproductline,themarketerinitiatestheHandle
It campaign on twitter, inviting consumers to share their uncomfortable, funny, and
embarrassingmomentstransformedintoaYouTubevideo,withtelevisionactorDanny
Pudiasthenarrator.DannyPudialsoprovidesconsumerswithsomeadviceonafewof
thecommonlyincurredHandleItmoments.
ThebrandssalesfurtherdeclineduetoalowTMEof$4.1millionin2012.Majorityof
the brands TME at $4.0million is allocated towards the advertisement of the newly
launchedSpeedStickPowerproductline.
4H7
4H8
OtherToiletries
Henkelisthefourthleadingmarketerintheothertoiletriesmarketwithsales$565million
in2012,up1.4%from$557millionin2011.
Henkel accounts for 8.6% of total product class sales in 2012, down marginally from
8.7%ofthetotalproductclasssalesin2011.
Personal cleansing products is the largest category for Henkel in the other toiletries
productclassin2012.Henkelisthethirdleadingmarketerinthecategoryin2012.The
marketers sales advance 2.1% in 2012, from $421million in 2011 to $430million in
2012.
Henkel is the secondleading marketer in the bar soaps and liquid soaps segments,
thirdleadingmarketerinthebodywashessegment,andthefourthleadingmarketerin
theantibacterialhandgelssegment.
Bar soaps is the biggest segment for the marketer accounting for 45.1% of the
companys total sales in 2012, though sales in the segment decline 2.9% from
Thelackofnewproductintroduction,packagingchange,orformulationchangehasa
negativeimpactonthesalesofthecompanyinthebarsoapssegment.
BodywashesisthesecondleadingsegmentforHenkel,up2.2%to$142millionin2012
In 2012, the marketer introduces the Dial Gold Antibacterial Round The Clock Odor
ProtectionDeodorizingBodyWashandtheHelloKittyMoisturizingBodyWash.
Intheliquidsoapssegment,salesofHenkeltotal$92millionin2012,up13.3%from
$81million in 2011. Growth of the brand in 2012 is attributed to the introduction of
newproducts,suchasNaturalTangerine&GuavaMoisturizingLiquidHandSoapand
HelloKittyAntibacterialFoamingHandWash.
In2012,DialisallocatedaTMEof$2.9millionwhileTonereceivesaTMEof$55,800.
In2012,HenkelsTonepartnerswithcountrysingerKerryPicklertopromotethenew
ToneFruitPeelBodyWash.
Deodorantsandantiperspirantsisthesecondlargestcategoryforthemarketerinthe
product class. Henkel is the fourthlargest marketer in the deodorants and
antiperspirants category, with sales at $135million in 2012, a decline of 0.7% from
$136millionin2011.
Henkelscategorysharedeclinesfrom6.8%oftotalcategoryssalesin2011to6.6%in
2012.Henkelcompetesinthecategorywithlargemarketers,suchasProcter&Gamble,
Unilever,andColgatePalmolive,whoenjoyagoodTMEsupport,brandloyalty,anda
widerdistributionnetworkincomparisontoHenkel.
Henkel is represented in the deodorants and antiperspirants category with the Right
GuardandDryIdeabrands,whileitdivestsitsSoft&DribrandtoBrynwoodPartnersin
April2012.
RightGuardisHenkelsleadingbrandinthecategorywithsalesat$108millionin2012
flatfrom2011levels.NewproductactivityforRightGuardin2012includesthelaunch
of the Sport Triathlon Clear Gel Antiperspirant and Deodorant. The TME support for
RightGuardisamere$2.1millionin2012.ThisisaninsignificantTMEincomparisonto
theTMEofotherbrandsavailableinthemarketwhichencashuponthisopportunityto
promotetheirproducts.
4A8
OtherToiletries
RETAILDISTRIBUTION
Massmerchandisersaretheprimaryretailoutletintheothertoiletriesproductclasswitha
44.1%shareofsalesin2012.
Foodstoresfollowatadistantsecond,accountingfor25.6%oftotalproductclasssales,
followedbydrugstoresat14.8%ofthetotalproductclasssalesin2012.
Department stores are the smallest retail outlet in the other toiletries product class,
representing2.7%oftheproductclasssalesin2012.
Table4H4:SalesofOtherToiletriesintheUnitedStatesbyRetailOutlet,2012
Deodorants
Depilatories
Personal
cleansing
Shaving
products
Weighted
average
Massmerchandisers
47
42
43
41
44.1
Foodstores
24
10
27
26
25.6
Drugstores
20
46
10
25
14.8
Specialtystores
12
8.1
Directsales
5.4
Departmentstores
2.7
100
100
100
100
100.0
Retailoutlet
Total
OUTLOOK
Sales of the other toiletries product class is likely to grow moderately at a CAGR of 1.7%
duringtheforecastperiodending2017.
Growthwillbedrivenbythemoderateperformanceofthematurepersonalcleansing
productscategoryandthegrowingdepilatories,waxes,andbleachescategory.
Marketers are expected to continue to create innovative marketing and promotional
strategiestokeepconsumersinterestedandengaged.Additionally,marketersarealso
goingtostepuptheiradvertisingexpendituresinthematurecategories.
Multifunctionalproductofferingscontainingbenefitsinadditiontothebasiccleansing
andmoisturizingfunctionswillcontinuetogainpopularitywiththemasses.
Marketers will continue to segregate their products to make them specific to gender
andagegroupsinthedeodorantsandantiperspirantscategory.
In the depilatories, waxes, and bleaches category, Olay is expected to expand its
presencebyventuringintothewaxesandbleachessegments.
Thewelltodomalepopulationisexpectedtotradeuptousingprestigeskincareand
shavingproducts.
There is a likely surge in mens skin care products offering cosmetic benefits such as
concealersandtintedmoisturizers
Malecentricshavingbrandsareexpectedtointroduceorexpandtheirexistingfemale
productlines.
4H9
4H10
OtherToiletries
SalesofthepersonalcleansingproductscategoryareforecasttoadvanceataCAGRof1.9%
Theslowgrowthofthecategorywillbesupportedbytheintroductionofnewproducts
across the various segments. Marketers can look to innovate with their products by
offering benefits in addition to the regular cleansing. Added benefits to the personal
cleansing products could be in the form of moisturizing, exfoliating, antiaging, odor
protection,andtheadditionofvitamins.
Otherfactorscontributingtothegrowthofthecategoryinvolvepackaginganddesign
changes,changeinformulationsofexistingproductlines,andthemarketerseffortsto
increasinglyintroducenaturallyformulatedproducts.
Thecategoryisinamaturephaseandlimitedinnovationfrommarketerswilldampen
thegrowthofthecategoryduringtheforecastperiod.
Thebodywashessegmentisexpectedtomaintainitspositionasthelargestsegmentin
the personal cleansing products category. Body washes providing multipurpose
functions,suchasshampoosandfacewashes,willcontinuetogainpopularityamong
menduringthenextfiveyears.
Liquidsoapsareexpectedtocontinuetogrowatamoderaterateasconsumersprefer
the use of liquid soaps over bar soaps to wash hands. Additionally, many consumers
shift from the use of antibacterial hand gels towards liquid soaps with the option of
usingantibacterialhandgelsonlywhenonthegointheabsenceofwater.
Sales in the antibacterial hand gels segment are expected to stabilize in the forecast
period as there is still a certain section of consumers who are concerned about their
health and hygiene habits and will continue to use hand gels for protection.
Additionally, marketers are expected to make efforts to educate consumers about
maintainingpersonalhygieneandtheimportanceofusingantibacterialhandgels.
Salesforthedeodorantsandantiperspirantscategoryareexpectedtogrowataslowpace
of1.2%duringtheforecastperiodending2017.
Clinicalstrengthproductswillcontinuetocontributetothecategorysvaluegrowth.
Marketers are expected to expand their product ranges with innovative products,
reformulating their existing line of products, and bring packaging changes to their
existinglineofproductsinordertokeepthecategoryalive.
However, further growth in the category is offset by a few factors, such as mature
phase of the category, limited scope for innovation, and a restricted growth in
population.
Additionally,thereislittlescopeformarketerstoexpandduetothehighpenetration
rateoftheirbrandsintheexistingretailchannels.
4A10
OtherToiletries
Theshavingproductscategoryisexpectedtoshowamoderategrowthof1.5%duringthe
Growth during the forecast period is most likely the direct result of changing habits
amongmentowardstheirpersonalgroomingastheybecomemoreconsciousoftheir
appearance.
Newandinnovativeproductlaunches,changingformulations,andimprovedpackaging
isexpectedtogarnerfurthergrowthinthecategorythrough2017.
Marketers will continue to undertake efforts to differentiate their brands from the
others available in the market by giving their brands a premium positioning in the
market,eventhosesoldinmasschannels.
Prestigemarketersareexpectedtogainmarketshareinthefuture.
Thedepilatories,waxes,andbleachescategoryisexpectedtowitnessmoderategrowthof
Olayisexpectedtocontinuetogrowitssalesbyexpandingitslineofproducts.Further,
Olayisexpectedtoforayintoothersegments,suchaswaxesandbleachesduringthe
The marketers ability to innovate with products and make them available in
convenienteasytousepackagingformatswilldrivesalesinthecategory.
Depilatory products formulated with natural ingredients will continue to gain
popularity,withmarketersincreasinglyintroducingsuchproducts.
However, inadequate marketing support from marketers for their new products and
theexistingproductportfolioisexpectedtorestrictfurthergrowthinthecategory.
Competitionfromalternatehairremovaltreatments,suchassalonservices,laserhair
removaltreatments,andathomehairremovaldeviceswillalsohinderthecategorys
growthduringtheforecastperiod.
ManufacturerssalesofothertoiletriesareprojectedtoadvanceataCAGRof1.7%toreach
$7,181millionby2017,upfrom$6,602millionin2012.
Table4H5:ForecastManufacturersSalesofOtherToiletriesintheUnitedStatesbyProduct
Category,2012to2017
$Million
Category
2012
2017
CAGR,%
4,026
4,424
1.9
2,040
2,160
1.2
Shavingproducts
373
402
1.5
163
195
3.7
6,602
7,181
1.7
Total
4H11
4H12
OtherToiletries
UnitvolumeisexpectedtoadvanceataCAGRof1.3%toreach3,015.4millionpackagesby
2017,upfrom2,825.7millionpackagesin2012.
Table4H6:ForecastUnitSalesofOtherToiletriesintheUnitedStatesbyProductCategory,2012to
2017
Millionpackages
Category
2012
1,663
2017
1,797
CAGR,%
1.6
891.2
925.9
0.8
Shavingproducts
238.3
253.0
1.2
33.2
39.5
3.5
2,825.7
3,015.4
1.3
Total
4A12
DEODORANTSANDANTIPERSPIRANTS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturers sales of the deodorants and antiperspirants category grow 2.1% from
Initsstateofmaturity,thecategorystrugglestopostgoodgrowth.
Sales for the category have grown at a compound annual growth rate (CAGR) of 1.8% to
reach$2,040millionin2012.
Table4H7:HistoricalSalesofDeodorantsand
AntiperspirantsintheUnitedStates,2007to2012
Year
$Million
Change,%
2007
1,869
2008
1,915
2.5
2009
1,911
(0.2)
2010
1,942
1.6
2011
1,999
2.9
2012
2,040
2.1
Unitsales
Unitsalesadvance1.5%to891.2millionpackagesin2012,upfrom877.7millionpackages
in2011.
Retailsales
Retailsalesofthecategoryincrease2.1%to$2,836millionin2012,upfrom$2,779million
in2011.
4H14
DeodorantsandAntiperspirants
Table4H8:ManufacturersSalesofDeodorantsandAntiperspirantsintheUnitedStatesbyBrand,
2011and2012
$Million
Brand
Company
2011
2012
Secret
Procter&Gamble
348
350
17.4
17.2
Degree
Unilever
254
265
12.7
13.0
OldSpice
Procter&Gamble
258
263
12.9
12.9
Dove
Unilever
183
209
9.2
10.2
Axe
Unilever
206
207
10.3
10.1
RightGuard
Henkel
108
108
5.4
5.3
SpeedStickr
ColgatePalmolive
97
96
4.9
4.7
Gillette
Procter&Gamble
76
74
3.8
3.6
Suave
Unilever
73
74
3.7
3.6
LadySpeedStick
SpeedStick
53
51
2.7
2.5
Ban
Kao
52
51
2.6
2.5
Arrid
Church&Dwight
45
43
2.3
2.1
LadyMitchumr
Revlon
35
33
1.8
1.6
Sure
InnovativeBrands
35
33
1.8
1.6
DryIdea
Henkel
28
27
1.4
1.3
Arm&Hammer
Church&Dwight
23
23
1.2
1.1
Tom'sofMaine
ColgatePalmolive
21
22
1.1
1.1
Mitchumr
Revlon
17
19
0.9
0.9
Brut
HelenofTroy
14
14
0.7
0.7
Avon
Avon
11
11
0.6
0.5
Soft&Dri
BrynwoodPartners
0.3
0.3
Adidas
Coty
0.2
0.2
TeenSpirit
ColgatePalmolive
0.2
0.1
Lady'sChoice
Church&Dwight
0.1
2011
2012
Privatelabel
0.1
0.1
Allotherr
47
51
2.4
2.5
1,999
2,040
100.0
100.0
Total
rRestated.
4A14
%Oftotal
CATEGORYDEVELOPMENT
Markettrends
Growthinthematureddeodorantsandantiperspirantscategoryisprimarilydrivenbynew
productintroductions,reformulations,andpackagingchanges.
Thecategorydoesnotwitnessanynewbreakinginnovationsin2012.
Marketers introduce products to its already existing line of products in the form of a
varietyoffragrances,therebyexpandingtheirproductlines.
Manyofthenewproductsaimtoprovideodorandwetnessprotectionforaminimum
of24hours.
In 2012, Henkel introduces the Right Guard Sport Triathlon Clear Gel Antiperspirant
and Deodorant which provides odor and wetness protection for 48 hours; Coty
introduces the Adidas Action 3 Control which provides 24hour antiodor and anti
whitening protection and is available in three variants: Fresh, Control, and Intensive
and; Unilevers Dove Clear Tone Skin Renew Deodorant which provides 24hour odor
and wetness protection with availability in three variants: Skin Renew Invisible Solid,
SheerTouchInvisibleSolid,andClinicalProtectionSkinRenew.
Few marketers reformulate their already existing product lines or introduce new
productslineswithimprovedtechnology.
In2012,UnileverreformulatesitsAdrenalineSeriesofdeodorantsandantiperspirants
withmotionSensetechnologywhichprovidesextraprotectiontofightbodyodorand
sweat.
In 2012, Procter & Gamble introduces the Secret Outlast Collection with Dual Action
Odor Technology and Coty introduces the Adidas Body Sprays with CoolTech
Technology.
However, the deodorants and antiperspirants market does not witness any new
innovationsintheformofproductdelivery,withmarketersstickingtotheoldformats
ofrollons,sticks,gels,softsolids,andaerosols.
Marketersareincreasinglyintroducingbodyspraysinthemistsprayformat.
CotysAdidasintroducestheDeodorantBodySprayinthreevariants:DeepEnergy,Ice
Dive,andPureGamein2012.Thesebodyspraysareavailablewithacapfreeactuator
whichallowsforconvenientapplicationoftheproductswithoutconsumershavingto
openthecapofthebodyspraytoapplytheproduct.
Marketersalsolookatupgradingtheproductpackagingofitsexistinglineofproducts
inanattempttoprovideanewandfreshlooktotheirproducts.
In2012,OldSpicechangesthepackagingforitsRedZoneandFreshCollectioninorder
tobringaboutmanufacturingefficiencies.
4H15
4H16
Clinicalstrengthproductscontinuetobeanotherdrivingfactorforthecategorysgrowthin
2012.
Clinical strength products demand higher prices in comparison to their conventional
counterparts due to the innovative technology involved in manufacturing these
products.
Clinical strength products are mainly bought by consumers experiencing heavy
sweatingorthosewhoareoutintheheatforlongdurationsoftime.
These products provide a simple and convenient solution to consumers to deal with
such embarrassing issues. It is estimated thatonly 2% of the population suffers from
hyperhidrosis, or extreme sweating, but one study found that many more people
believethattheysweatexcessively.Thisisthetargetmarketforsuchproducts.
Afewofthevariantsavailableinthemarketinclude:SecretClinicalStrengthPowder
Protection, Dove Clinical Protection Antiperspirant/Deodorant Rebalance, Degree
Clinical Strength Fresh Energy, and Suave Clinical Protection Prosolid Everlasting
Sunshine.
Other brands, such as Gillette, Degree, Arrid, and Sure also offer clinical strength
products.
In2012,UnileverintroducestheDegreeClinicalProtectionCottonFreshvariant.
These clinical strength products are formulated with active ingredients, such as
aluminumzirconiumcompounds,thathelpcontrolsweating.
However, there is still room for development with a number of brands, such as Ban,
Axe, and Right Guard still not offering clinical strength products in their range of
deodorantsandantiperspirants.
Marketerscontinuetosegregatetheirproductstomakethemspecifictogenderandage
groups.
Genderspecific product lines help marketers expand their offerings with different
fragrancestargetingdifferentgendersandprovidingconsumerswithawiderchoiceof
products.
ColgatePalmolive, Unilever, and Revlon offer separate deodorant and antiperspirant
productlinesformenandwomenwithSpeedStick,DoveMen+Care,andMitchumfor
men, respectively, and Lady Speed Stick, Dove, and Lady Mitchum for women,
respectively.
Marketers also provide different product offerings for adults and teens in order to
meettheirspecificrequirements.
Unilevers Axe is targeted towards the young male consumers while Colgate
PalmolivesTeenSpiritistargetedtowardsteenagegirls.
However, most marketers target the younger audience, who remain the primary
consumerswithinthecategory.
Since2010,OldSpicehasworkedtofreshenupitsbrandimageinthemarketwitha
changeinpackagingandthewayitmarketsitsproducts,inordertoappealtoawider
base of consumers. It especially targets the young male consumers thereby helping
driveupthebrandssales.
BrandssuchasAxe,Adidas,andTeenSpirittargettheyoungeraudience.
4A16
Therapidlygrowingmalegroomingmarkethasapositiveeffectonthecategoryssales.
Therehasbeenanincreaseinthedemandfordeodorantsandantiperspirantstargeted
towardsmen,asmenbecomemoreconsciousoftheirgroominghabits.
The malecentric deodorants and antiperspirants availablein the market includeAxe,
Adidas,DoveMen+Care,OldSpice,Mitchum,andSpeedStick.
In 2012, Unilever introduces the Axe Anarchy For Him, ColgatePalmolive introduces
theSpeedStickPowerrangeofproducts,and CotyintroducesthreeSKUseachtoits
AxeDeodorantBodySprays,andAction3ControlAntiperspirants.
Also, adding to the categorys growth is innovation in the form of marketing and
promotionalsupport.
Marketerscreateinnovativemarketingandpromotionalstrategiestokeepconsumers
interestedandengagedintheotherwisematurecategory.
Axeenjoysimmensepopularitywithyoungconsumersanddirectsitsmarketingefforts
totargetyoungadultmaleswhoareitscoreconsumers.Itsadvertisingcampaignshave
areputationofbeingmodern,irreverent,andrisqu.
Procter & Gambles Old Spice, a malecentric brand, is known for its popular viral
campaignswhichareahitwiththemassessincetheyinvolvetheconsumersbecoming
apartoftheinteractiveadvertising.
Thecategorycontinuestobedominatedbywellestablishednationalbrands.
Privatelabelhasaminisculepresenceinthecategory,representingamere0.1%ofthe
totalcategoryssalesin2012.
The limited presence of privatelabel products in the category is because most
consumersconsideritasanintegralpartoftheirpersonalhygieneregimenandprefer
wellestablishedbrandsoverprivatelabelproducts.
Moreover, private label finds it challenging to compete with established national
brandsduetolackofinnovativeproductofferingsandpaucityoffundstosupporttheir
lineofproductswithagoodmarketingstrategy.
Additionally, the cost of producing deodorants and antiperspirants is relatively
expensive and therefore the margin difference between privatelabel products and
brandedproductsislowercomparedtoothercategories.Thismakestheprivatelabel
categorylessattractiveforretailers.
M&Aactivity
Brynwood Partners subsidiary Golden Sun acquires Soft & Dri deodorant brand from
Henkel. Based in Santa Clarita, CA, Golden Sun is whollyowned by Brynwood Partners.
Termsandconditionsofthetransaction,whichclosesonApril1,2012,arenotdisclosed.
4H17
4H18
Notablenewproducts
Table4H9:SelectNewDeodorantsandAntiperspirantsIntroducedintheUnitedStatesin2012
Company
Brand
Description
Arbonne
International
Arbonne
PureMintDeodorantisaluminumfree,andinfusedwithmintandextractsfromwhite
tea,ginger,lemongrass,sage,andteatreetofightbadodor
ColgatePalmolive
SpeedStick
SpeedStickPoweroffersbothantiperspirantanddeodorantbenefits,availableinfour
scents:Fresh,Unscented,UltimateSport,andenergySpurgeinsolidformatsandin
twoscentsinthegelformat:FreshandUltimateSport
ColgatePalmolive
Tomsof
Maine
MensLongLastingWideStickDeodorantcontainsaluminumandpropyleneglycol
freedeodorantstickscontainodorfightingbotanicalhopsandzincricinoleate
availablein100%naturalfragrances,areclinicallyproventoprovide24hourodor
protection.Itisavailableintwovariants:CleanConfidenceandMountainSpring
ColgatePalmolive
Tomsof
Maine
NaturallyDryAntiperspirantStickisclaimedtobemadeofnaturallyderived
ingredientsandclinicallyproventokeepfreshanddry.ItisavailableinNatural
PowderandUnscented/FragranceFreevariants
Coty
Adidas
DeodorantbodyspraysareinfusedwithCooltechtechnologyfor24hourfreshness.It
comeswithacapfreeactuator,developedforathletesandisavailableinthreescents:
DeepEnergy,IceDive,andPureGame
Coty
Adidas
Action3Controlisa24hourantiodorandantiwhiteningantiperspirantwithDryMax
Systemthathasbeenespeciallydesignedforathletes.Itisavailableinthreescents:
Fresh,Control,andIntensive(24hourplusprotection)
Creed
Creed
MillesimeImperialDeodorantisanalcoholandaluminiumfreedeodorantforallday
longprotection.Itretailsfor$65.00,over10timesmorethanthemassmarket
deodorants
FrenchTransit
Crystal
RockDeodorantStickpromisestonaturallyeliminateodorcausingbacteriawith100%
mineralsaltcomponentswithouttheuseofaluminums,parabensandchemicals
FrenchTransit
Crystal
RockDeodorantStickcombinesodorkillingnaturalmineralsaltswith100%natural
fragrancestoprovide24hourprotection
Henkel
RightGuard
SportTriathlonClearGelAntiperspirantandDeodorantprovides48hoursofodorand
wetnessprotection
Kao
Ban
SimplyCleanInvisibleSolidcontainsfloralandambernotesforalonglastingscent
Procter&Gamble
Secret
SecretOutlastwithDualActionOdorTechnologyprovidesfreshnessthatlastsupto48
hours.Italsominimizesodorcausingbacteriaandisavailableininvisiblesolid,clear
gel,andsmoothsolidformats
TCCDInternational
GeoDeo
NaturalDeodorantPlushelpsremovedailybuildupoftoxinsandimpuritieswith
DetoxComplex
Unilever
Axe
AnarchyForHimhasAxessignaturefragrancecomprisingfreshandfruitynotesand
notesofsandalwoodandamber
Unilever
Axe
AnarchyForHerisacombinationofappleandblackberrynotesatthetop,softflorals
attheheart,andabaseofsandalwood,amber,andvanilla
Unilever
Degree
ExpertProtectionLinenDrywithMotionsensetechnologyisinfusedwithafloral
greenscenttoprovidefreshness
Unilever
Degree
ClinicalProtectionCottonFreshwithMotionsensetechnologyisinfusedwiththe
fragranceofwhiterosepetalsandjasmineandoffersodorprotectionthroughoutthe
day
Unilever
Degree
NatureEffectsInvisibleSolidAbsorbentSeaSaltisablendofginger,mint,andteafor
longlastingprotection
Dove
ClearToneSkinRenewDeodorantprovides24hourodorandwetnessprotection,
helpsreducedarkmarks,provideanevenskintone,anddesignednottoleavewhite
marks.ItisavailableasSkinRenewInvisibleSolid,SheerTouchInvisibleSolid,and
ClinicalProtectionSkinRenew
Unilever
4A18
Salesbyproducttype
Invisible solid sticks continue to be the largest product type in the segment in 2012 with
$943million in sales; a distant lead from the secondlargest product type, regular solid
sticks.
Salesforinvisiblesolidsticksareup3.2%from$914millionin2011.
Invisiblesolidsticksrepresent46.2%oftotalcategorysalesin2012,upfrom45.7%in
2011.
Growthinthesegmentisfueledbytheconsumersdesireforproductswith nowhite
residuebenefitsandtheintroductionofnewvariantsbyafewcompanies.
In2012,UnileverintroducestheDoveClearToneSkinRenewDeodorantinSkinRenew
InvisibleSolidandSheerTouchInvisibleSolidvariants.
Regularsolidstickisthedistantsecondleadingsegmentinthecategoryin2012.
Salesforregularsolidsticksgrow2.3%to$444millionin2012,upfrom$434millionin
2011.
They account for 21.8% of total category sales in 2012, marginally up from 21.7% in
2011.
Regularsolidstickscontinuetogainmarketshareduetotheirlowpricepointandthe
repeatpurchaseofsuchproductsbythepriceconsciousconsumers.
However,furthergrowthoftheproducttypeisoffsetbythemessyresidueleftbehind,
andtherapidrateatwhichtheseproductsfinish.
Salesofaerosolsandrollonsdeclineduetothedecreasingdemand.
Salesforaerosolsdecline1.5%whilesalesforrollonsdecline3.1%in2012.
Sales of aerosols are affected by the perception that aerosols are bad for the
environmentandtheconsumerspreferenceforstickdeodorants.
Table4H10:ManufacturersSalesofDeodorantsandAntiperspirantsintheUnitedStatesbyProduct
Type,2011and2012
Producttype
$Million
%Oftotal
2011
2012
2011
2012
Changeinvalue,%
Invisiblesolidstick
914
943
45.7
46.2
3.2
Regularsolidstick
434
444
21.7
21.8
2.3
Gels
208
210
10.4
10.3
1.0
Softsolidextrudable
203
208
10.2
10.2
2.5
Aerosol
134
132
6.7
6.5
(1.5)
Rollon
97
94
4.9
4.6
(3.1)
0.5
0.4
1,999
2,040
100.0
100.0
2.1
Allother
Total
4H19
4H20
COMPETITION
Bycompany
Table4H11:ManufacturersSalesofDeodorantsandAntiperspirantsintheUnitedStatesby
Company,2011and2012
$Million
%Oftotal
Company
2011
2012
2011
2012
Change,%
Unilever
716
755
35.8
37.0
5.4
Procter&Gamble
682
687
34.1
33.7
0.7
ColgatePalmolive
174
172
8.7
8.4
(1.1)
Henkel
136
135
6.8
6.6
(0.7)
Church&Dwight
69
66
3.5
3.2
(4.3)
Revlonr
52
52
2.6
2.5
Kao
52
51
2.6
2.5
(1.9)
118
122
5.9
6.0
3.4
1,999
2,040
100.0
100.0
2.1
Allother
Total
Unilever continues to be the leading marketer in the deodorants and antiperspirants

categoryin2012.
Themarketerssalestotal$755millionin2012,up5.4%from$716millionin2011.
Thecompanysmarketshareincreasesfrom35.8%in2011to37.0%in2012.
Degree is the leading brand for Unilever and the secondleading brand in the
deodorantsandantiperspirantscategorywithsalesadvancing4.3%to$265millionin
The brand sustains its growth with its loyal consumer base and product offerings for
bothmenandwomen.
In 2012, sales of the Degree brand are supported by the expansion of the womens
ExpertProtection,ClinicalProtection,andNatureEffectsInvisibleSolidsproductlines
withtheLinenDry,CottonFresh,andAbsorbentSeaSaltsvariants,respectively.
In 2012, the marketer also revolutionizes its Degree Men Adrenaline Series with
Motionsense technology. The technology is composed of motionactivated micro
capsules that provide extra protection to combat extra sweat and odor. The Degree
Men Adrenaline Series with Motionsense technology comprises variants including
Adventure,Extreme,Everest,SportDefence,andV12.
4A20
DoveadvancestobecomethesecondlargestbrandforUnileverinthecategory.The
brandgrows14.2%toreach$209millionin2012,upfrom$183millionin2011.Dove
hasbeenpostinggoodgrowthsince2011.
Doveoffersdeodorantsandantiperspirantsforbothmenandwomen.
In2012,UnileverintroducestheDoveClearToneSkinRenew(forwomen)proclaiming
thatitsformula,enrichedwithcalendulaandsunflowerseedextracts,helpsaccelerate
the skins renewal process, provides 48hour odor and wetness protection, reduces
darkmarks,andprovidesanevenskintone.
Dovesgrowthin2012issupportedbygoodadvertisingexpenditureof$49.8millionin
2012. Doves new Clear Tone Skin Renew Deodorant is allocated traceable media
expenditures (TME) of $14.7 million while the Dove Go Sleeveless line of products is
allocatedaTMEof$15.9million.
DoveMen+Caresmarketingprimarilyrevolvesaroundsportspersonalitiesandsports.
DoveMen+CareisthetitlesponsoroftheDad2.0Summit.Thesummithasaseriesof
eventswherebyapanelofspeakerspresentanumberofissuespertainingtothelives
of men including the importance of fatherhood in their life. The brand offers male
consumersthechancetohavealivediscussionwithformerprofessionalfootballstar,
DougFlutiebyloggingontothebrandsFacebookpagein2012.
Dove Men+Care also organizes a number of contests, such as the Fan Bowl Photo
Challengewiththeluckyparticipantsgettinganopportunitytowinprizesthroughout
theNCAAFootballSeason.
Axe,thethirdlargestbrandforthecompanygrows0.5%from$206millionin2011to
$207millionin2012.
In2012,UnilevertakesamajorstepbyintroducingtheAxeAnarchy,thefirstfragrance
in the brands history targeting both men and women. The body spray is allocated a
TMEof$22.9millionin2012,thehighestforthebrandamonganyofitsdeodorants
andantiperspirantsin2012.TheAxeAnarchyForHerisalimitededitionproduct,with
the marketer waiting to see the response that the market has for the brands first
femaleorientedproduct.
Axe has been advertising its product benefits as giving men the edge in the mating
game.However,withthelaunchoftheAxeAnarchyproduct,themarketerseemsto
bechangingthebrandsimagewiththeAxeAnarchysadvertisementfeaturingaman
and a woman walking towards each other passionately while the world collapses
aroundthem,usingthetaglineUnleashthechaos.NewAxeAnarchyforhimandfor
her. This campaign now suggests that men and women are equally involved in the
courting process. The marketer launches a teaser campaign called Axe: Anarchy is
Comingwhichinvolvesagraphicnovelwithconsumerssuggestionsincorporatedand
somebeingdepictedinacomicroleplay.Thetelevisionadvertisementcampaignstarts
early2012withsupportfromdigitalandoutdooractivity.
Suave, Unilevers smallest brand, records sales at $74 million in 2012, up 1.4% from
$73million in 2011. The brand accounts for 9.8% of the marketers share in the
category.
4H21
4H22
Procter & Gamble is the secondleading marketer in the deodorants and antiperspirants
categoryin2012.
Themarketerexperiencesamarginalgrowthof0.7%toreach$687millionin2012,up
Thecompanysshareinthecategoryfallsfrom34.1%in2011to33.7%in2012.
brands.
categorysalesin2011.
Procter&GamblesTMEsupportforSecretincreases4.5%from$39.9millionin2011
to $41.7 million in 2012, with Secret Clinical Strength and Secret Outlast being
allocatedthemaximumTMEat$18.8millionand$22.5million,respectively.In2012,
the marketer introduces the Secret Outlast in Invisible Solid, Clear Gel, and Smooth
Solid variants. To promote the Secret Outlast Collection, Procter & Gamble partners
withJenniPulos,atelevisionpersonalityandactresstohelpconsumersconquertheir
hecticworkscheduleswhiletheproductprovidesthemwith48hourodorprotection.
Old Spice, the marketers secondleading brand in the category posts sales at
$263million in 2012, up 1.9% from $258million in 2011. Old Spice, a malecentric
brand, has changed its approach which now involves reaching out to men of all age
groups, thereby helping improve its brand image as against its previous approach
which targeted only the older and mature men. The brand benefits from its loyal
consumerbaseasaresultofitslongpresenceinthecategory.
In2012,thebrandhasanotherviralhitwithitsMuscleMusicPlayervideofeaturing
formerNFLplayerTerryCrewswhocontrolsavarietyofinstrumentssimultaneouslyby
flexing his forearms, biceps, abs, deltoids, and quads. The advertisement acts as a
musicmaker game, involving interaction from consumers who have the ability to
controlCrewsbodyandinstruments.Oncethevideofinishes,theyhavetheoptionof
recordingit.ThebrandsvideoontheYouTubechannelisaninstanthitduringitsinitial
launchandcontinuestogainalotofhitsonYouTube.
Another marketing campaign of Old Spice features NFL star Greg Jennings promoting
theChampionDeodorantinaseriesofsevencommercialsthatgoliveduringtheNFL
2012season.
SalesforGillettedecline2.6%to$74millionin2012, downfrom$76millionin2011.
ThecategoryshareofGillettedeodorantsdeclines0.2%from3.8%in2011to3.6%in
2012. Gillettes sales decline are a result of the lack of newness from the brand with
respecttoproducts,changeinformulations,orpackagingchanges.
4A22
ColgatePalmolive is the thirdleading marketer in the deodorants and antiperspirants

categoryin2012.
Manufacturerssalesdecline1.1%to$172millionin2012,downfrom$174millionin
2011.
Themarketeraccountsfor8.4%oftotalcategoryssales,downfrom8.7%in2011.The
marketersshareinthecategoryhasbeendecliningsince2011.
ColgatePalmolive is represented in the category by Speed Stick, Lady Speed Stick,
TomsofMaine,andTeenSpirit.
SalesofSpeedStick,theflagshipbrandofthemarketer,decline1.0%from$97million
in2011to$96millionin2012.Thebrandssalesdeclineinspiteofthelaunchofthe
newproductlineSpeedStickPowerin2012.Theproductlinecontainsfourvariantsin
the solid form and two variants in the gel form. To launch the product line, the
marketerinitiatestheHandleItcampaignontwitter,invitingconsumerstosharetheir
uncomfortable,funny,andembarrassingmomentstransformedintoaYouTubevideo,
withtelevisionactorDannyPudiasthenarrator.DannyPudialsoprovidesconsumers
withsomeadviceonafewofthecommonlyincurredHandleItmoments.
ThebrandssalesfurtherdeclineduetoalowTMEof$4.1millionin2012.Majorityof
the brands TME at $4.0 million is allocated towards the advertisement of the newly
launchedSpeedStickPowerproductline.
Lady Speed Stick is the secondlargest brand for the marketer with sales down 3.8%
from$53millionin2011to$51millionin2012.Salesforthebranddeclineduetothe
absence of new product activity, negligible TME, and an increasing competition from
otherfemaleorienteddeodorantsandantiperspirantsbrands.
In2012,LadySpeedStickistheofficialsponsoroftheWomensHalfMarathonheldat
St.Petersburg,FL.Theeventencourageshealthandfitnessamongwomen.
Toms of Maine, the thirdleading brand for ColgatePalmolive registers a growth of
4.8%toreach$22millionin2012,upfrom$21millionin2011.Thebrandaccountsfor
1.1%oftotalcategorysalesin2012,stagnantfrom2011.
TomsofMainesgrowthin2012isattributedtothebrandspositioninginthemarket
as a producer of aluminumfree deodorants since aluminum has been linked as a
reason for breast cancer. Additionally, the brands expansion into mainstream retail
outletsaddstoitssalesin2012.However,furthergrowthofthebrandisoffsetbythe
premiumpricingofthebrandsdeodorantsandantiperspirantsastheyareretailedfor
approximatelytwicethepriceoftheirregularcounterparts.
In 2012, the company introduces the Toms Of Maine Mens Long Lasting Wide Stick
DeodorantinCleanConfidenceandMountainSpringvariants,andtheTomsofMaine
NaturallyDryAntiperspirantStickintheNaturalPowderandUnscented/Fragrancefree
variants.
In 2012, the brand partners with TerraCycle, an organization that works towards
eliminating waste by providing solutions and systems to companies, to launch the
TomsofMaineNaturalCareBrigadewhichenablesconsumerstokeeppackagingfrom
TomsofMaineproductsoutoflandfills.Asacontinuationofits50StatesforGood
program,thebrandannouncesyetanother$150,000asapartoftheprojectfunding.
The winning projects, which have been voted for by the public, include initiatives
around reforestation, environmental dance programs, free dental care, and a
friendshipnetwork.
4H23
4H24
Henkelisthefourthlargestmarketerinthedeodorantsandantiperspirantscategory,with
salesat$135millionin2012.
Salesdecline0.7%from$136millionin2011.
Henkelscategorysharedeclinesfrom6.8%oftotalcategorysalesin2011to6.6%of
total category sales in 2012. Henkel competes in the category with large marketers,
such as Procter & Gamble, Unilever, and ColgatePalmolive, who enjoy a good TME
support,brandloyalty,andawiderdistributionnetworkincomparisontoHenkel.
HenkelisrepresentedinthecategorywiththeRightGuardandDryIdeabrands,whileit
divestsitsSoft&DribrandtoBrynwoodPartnersinApril2012.
RightGuardisHenkelsleadingbrandinthecategorywithsalesat$108millionin2012
flatfrom2011levels.NewproductactivityforRightGuardin2012includesthelaunch
of the Sport Triathlon Clear Gel Antiperspirant and Deodorant. The TME support for
RightGuardisamere$2.1millionin2012.ThisisaninsignificantTMEincomparisonto
theTMEofotherbrandsavailableinthemarketwhoencashuponthisopportunityto
Privatelabel
Privatelabelwitha0.1%categoryshare,havenegligiblepresenceinthecategory.
Privatelabel products have experienced difficulties penetrating the category due to
their inability to offer consumers an array of product offerings, thereby failing to
competewiththewiderangeofproductsofferedbyestablishedmarketers.
Moreover, consumers prefer to use deodorants and antiperspirants of established
marketersfortheirpersonalhygieneneeds,therebymakingitdifficultforprivatelabel
productstomakeinroadsinthecategory.
RETAILDISTRIBUTION
Mass merchandisers continue to be the leading retail channel for deodorants and
antiperspirantsin2012,with47.0%oftotalcategoryssales,unchangedfrom2011levels.
Foodstoresloseoutonthepercentagesharein2012withadeclineof100basispoints
tocontribute24.0%ofthetotalcategoryssales
Drug stores sustain their share at 20.0% of the categorys sales in 2012. The retail
channelusesmethods,suchasspecialdiscountsandoffers,inhousetelevisionspots,
advertising, and instore promotions to assist in sales increase of deodorants and
antiperspirantsintheiroutlets.
Thepercentageshareofdirectsalesimprovesto3.0%in2012,upfrom2.0%in2011
on account of the popularity of ecommerce sites and the company websites for the
purchaseofdeodorantsandantiperspirants.
4A24
Table4H12:ManufacturersSalesofDeodorantsandAntiperspirantsin
theUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
47
47
Foodstores
25
24
Drugstores
20
20
Departmentstores
Directsales
Specialtystores
100
100
Total
MARKETINGACTIVITY
Deodorantsandantiperspirantsareprimarilymarketedthroughthreechannels.
Televisionandmagazineadvertisementscontinuetobethepreferredmarketingmedia
amongstmarketers.Duetothecompetitivenatureofthemarketandthedominance
ofmassbrandsinthecategory,mostmarketersadopttraditionaladvertisingforawide
outreach. A few of the preferred magazines include Allure, Vogue, Glamour, In Style,
CosmoGirl,MensFitness,andMensHealth.
The second mostpreferred promotional channel includes promotions, samples, price
discount,coupons,andfreestandinginserts(FSIs).
Thethirdandthenewestchannelgainingpopularityistheuseofsocialmediaonthe
Internet, comprising sites, such as Facebook, Twitter, YouTube, and Pinterest for
marketerstopromotetheirproducts.
The category is dominated by a few large marketers who rely on discount coupons and
promotionalofferstomarkettheirproducts.
Discountcouponscontinuetobeanimportantpromotionaltoolutilizedbymarketers
tomaintaintheirsales.
Marketersusecouponstosupportnewproductintroductionsandpromotebrandsales.
These coupons, available in various denominations depending on the brand, are
offeredthroughmagazines,FSIs,theInternet,andretailstores.
Consumersutilizediscountcouponstogainpricereductionsonnewproductsandfora
chancetotrynewproductsanddifferentiatethemwiththeexistingones.
4H25
4H26
Table4H13:SelectCouponingActivitiesofDeodorantsandAntiperspirants,2012
Company/division
Brand
Promotion
Henkel
RightGuard
Thecouponisfor$3.00offonanytwoTotalDefense5
antiperspirantordeodorant
Procter&Gamble
OldSpice
Freeshipping,15%offonOldSpicedeodorantproducts,anda
couponworth$2.00
Unilever
Axe
$1.00offonanyAxedeodorantorantiperspirant
Unilever
Degree
$2.00offonanyoneDegreeclinicalproductand$0.75offon
anyoneDegreeproduct
Unilever
Suave
$0.50offonanySuavedeodorant
Onlinepromotionscontinuetogainprominenceasmarketersincreasinglyadoptthesetools
topromotetheirproducts.
Facebook,Twitter,andYouTube,remainthemostsoughtaftersocialmediachannels
utilizedbymarketersduetotheirpopularitywithconsumers.
Advertisements of brands, such as Axe, Old Spice, and Gillette, are present across
variouschannels,includingseveralsocialmedianetworkingsites,suchasFacebookand
Twitter,andonlinestreamingmediasites,suchasYouTube.
Brands also use their websites as good promotional tools by offering consumers fun
and interactive activities, such as multimedia games, applications, new product
information,andvideosharing.
Brandloyal consumers wanting to know about the latest offers and new product
activityfromthebrandalsohavetheoptionofsigningupforthebrandsnewsletter.
Malecentricbrandscontinuetoassociatethemselveswithpopularsportspersonalitiesand
sports.
Unilevers Degree Women deodorant teams up with Erin Andrews, a sports
broadcaster,tocelebrate"UnapologeticallyStrong"womenwhoarenotafraidtotest
their limits and are willing to push boundaries. Erin Andrews shares her personal
challenges and victory stories on Facebook and helps encourage others to face
challenges.Thecompanyalsoprovideswomenanopportunitytowin$5,000byvisiting
theDegreeFacebookpage.
Procter&GamblesGillettelaunchesMyCityisMyGymcampaignthaturgesmento
puttotesttheirGillettesOdorShieldantiperspirant/deodorantbytakingtheirexercise
regime outdoors. The company partners with three professional athletes hockey
playerPatrickSharp;formerfootballstarDhaniJones;andfootballlegendJerryRice
topromoteitsGillettebrand.
4A26
TMEofthedeodorantsandantiperspirantscategorytotals$224.1millionin2012,up2.1%
Unilever continues to be the leading advertiser in the category with TME of
Procter&GamblesTMEdeclines20.5%in2012to$69.9million,from$88.0millionin
2012.
Unilevers Degree brand is the most advertised brand within the marketers portfolio of
deodorantsandantiperspirantsin2012.
Degreereceivesadvertisingsupportof$56.9millionin2012.
Dovereceivesthesecondhighestadvertisingexpenditureat$49.8millionin2012.The
combinedTMEofDoveGoSleevelessandDoveClearTonetotals$30.7million.
Unilever further reduces the advertising expenses of its Axe brand in 2012 to
$27.9million,adeclineof1.1%from$28.2millionin2011.
Withanallocationof72.1%ofthetotalTME,televisionadvertisementsarethemost
importantmeansofadvertisingadoptedbythemarketer.
Procter& Gamble continues to be the secondleading advertiser in the deodorants and

antiperspirantscategoryin2012.
ThemarketersTMEin2012amountsto$69.9million,down20.5%from$88.0million
in2011.
Secret,themarketersleadingbrand,receivesaTMEsupportof$41.7millionin2012.
Thisisanincreaseof4.5%from$39.9millionin2011.
The Secret Outlast Collection receives the maximum TME among the Secret line of
productswithexpendituresat$22.5millionin2012.
Televisionisthemostpreferredadvertisingmediumadoptedbythebrand.Television
advertisementsaccountfor61.7%ofthetotalTME.
Thesecondleadingadvertisingmediumforthemarketerismagazineadvertisements,
accountingfor22.6%ofthetotalTME.
In2012,Procter&GamblereducesitsadvertisingexpenditureonInternetadvertising
to$10.2millionin2012,down43.0%from$17.9millionin2011.
The company partners with Jenni Pulos, a television personality, actress, rapper, and
executiveassistant,topromoteitslatestlineofproducts,theSecretOutlastCollection.
In2012,Procter&GamblesetsuptheGangUpforGoodhubatmeanstinks.comin
the honor of National Bullying Prevention Month. The website offers a NiceAdvice
section, whereby girls all over the country share their experiences, encourage other
girls,andprovideexamplesofhowtheyvesuccessfullyGangedUpForGood.
In the second year of the Mean Stinks program, the brand partnerswith music artist
DemiLovatoandencouragesgirlstobeapartofthemovementthatattemptstobring
an end to mean behavior. The girls participating in this program are expected to
promote the Mean Stinks pinky swears by painting their nails blue to support peace
andsolidarity.
ThecompanypromotesitsOldSpicebrandwithamusicalhitMuscleMusic,avideo
whichfeaturesTerryCrews,aformerNFLplayer.Whenthevideofinishes,viewerscan
devloptheirownmusicbymovingCrewsmuscleswiththeirkeyboard.Eachkeystroke
flexesamuscleonCrewsbodytohitaninstrument.
4H27
4H28
OUTLOOK
Salesforthedeodorantsandantiperspirantscategoryareexpectedtogrowataslowpace
of1.2%duringtheforecastperiodending2017.
Clinicalstrengthproductswillcontinuetocontributetothecategorysvaluegrowth.
Marketers are expected to expand their product ranges with innovative products,
continue to reformulate their existing line of products, and bring about packaging
changestotheirexistinglineofproductsinordertokeepthecategoryalive.
However, further growth in the category is offset by a few factors, such as mature
phase of the category, limited scope for innovation, and a restricted growth in
population.
Additionally,thereislittlescopeformarketerstoexpandduetothehighpenetration
rateoftheirbrandsintheexistingretailchannels.
Clinical strength products will continue to contribute to the categorys sales during the
Clinical strength deodorants and antiperspirants, which are better equipped to fight
odorandprovideprotectionagainstwetnessareexpectedtohelpspurthecategorys
growth.
Sincetheseclinicalstrengthproductsarenewtothecategoryandarewellperceived
bytheconsumers,marketersarelikelytocontinuetoemphasizeontheirdevelopment
by trying to innovate with fragranced variants, offering consumers a wider base of
productstochoosefrom.
Furthermore, the availability of these clinical strength products at premium price
pointswillaidinthevaluegrowthinthecategory.
Newproductactivityandinnovationwillcontinuetobolstergrowthinthecategory.
Marketers are expected to introduce new products with improved formulations and
advancedtechnologytodifferentiatetheirproductsfromothermarketers.
The aluminumfree deodorants and antiperspirants are expected to perform well
during the forecast period as consumers become more conscious of the purported
dangersoftheingredient.
Products offering odor and wetness protection for longer hours will be the primary
areasoflookoutforconsumers.
Innovative and fresh fragrances will help marketers diversify their product variants
targetingawiderconsumerbase,therebyaidinggrowthofthecategory.
Marketersarealsoexpectedtoexperimentwithnewandinventivedeliveryforms,and
creativeandattractivepackagingfortheirproducts.
4A28
With the presence of large marketers, such as Procter & Gamble, Unilever, Colgate
Palmolive, and Kao, the marketing and promotional spending are expected to remain at
highlevels.
Companies are likely to support their new product introductions with high media
expenditurestoensurevisibilityoftheirproductsinthemarket.
In order to differentiate their products from the others available in the market,
marketers are expected to launch creative and innovative marketing strategies to
gatherconsumersattentiontherebyhelpingthebrandsgrowth.
Changeinthepopulationdemographicswillalsodeterminethecategorysgrowth.
Withanincreasingtrendamongmentowardspersonalgroominghabits,thedemand
fordeodorantsandantiperspirantsislikelytogoupduringtheforecastperiodending
2017.
Additionally,theyoungmaleconsumerswhoaremoreopentotryingoutnewproduct
offerings of the various brands available in the market are likely to spend higher
proportionsontheirpersonalgroomingneeds.
In an attempt to target the tweens (812 year olds), marketers are expected to
introduceproductlineswithcolorfulandattractivepackagingprimarilytargetedtothe
particularneedsoftweens.
Growth in the deodorants and antiperspirants category is expected to be driven by the

introductionofmorenaturalandorganicproductsduringtheforecastperiod.
Marketers will increasingly introduce natural components in their products to drive
growth.
Natural products are preferred by consumers who have sensitive skin and higher
environmentalawareness.
Suchproductswiththeirpremiumpricepointswillgarnervaluegrowthinthecategory.
Marketers are expected to pay increased emphasis on the development of Natural
productsthatofferodorandwetnessprotection.
Sales of the deodorants and antiperspirants category are projected to grow at a CAGR of
1.1%toreach$2,160millionby2017,upfrom$2,040millionin2012.
UnitsalesofdeodorantsandantiperspirantsareforecasttogrowataCAGRof0.8%from
891.2millionpackagesin2012to925.9millionpackagesin2017.
4H29
4H30
4A30
DEPILATORIES,WAXES,ANDBLEACHES
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturers sales for the depilatories, waxes, and bleaches category post a growth of
13.2%to$163millionin2012,upfrom$144millionin2011.
Since 2007, the sales of the depilatories, waxes, and bleaches category have grown at a
compoundannualgrowthrate(CAGR)of3.4%from$136millionin2007to$163millionin
2012.
Table4H14:HistoricalSalesofDepilatories,Waxes,and
BleachesintheUnitedStates,2007to2012
Year
$Million
2007
136
2008
139
2.2
2009
138
(0.7)
2010r
135
(2.2)
2011
144
6.7
163
13.2
2012
rRestated.
Change,%
4H32
Depilatories,Waxes,andBleaches
Table4H15:ManufacturersSalesofDepilatories,Waxes,andBleachesintheUnitedStatesbyBrand,
2011and2012
$Million
Brand
Company
SallyHansen
Coty
Nair
2011
%Oftotal
2012
2011
2012
45
46
31.3
28.2
Church&Dwight
42
45
29.2
27.6
Veet
ReckittBenckiser
25
26
17.4
16.0
Olay
Procter&Gamble
19
2.8
11.7
Nad's
SueIsmiel&Daughters
10
6.9
4.9
HairOff/BikiniZone
CCAIndustries
2.8
2.5
Jolen
JolenCrmeBleachCorp.
2.1
1.8
Magic
LOral
1.4
1.2
ArdellSurgi
AmericanInternational
0.7
0.6
Privatelabel
2.1
1.8
Allother
3.5
3.7
144
163
100.0
100.0
Total
Unitsales
Unitsalesofthedepilatories,bleaches,andwaxescategoryadvance12.9%to33.2million
unitsin2012,upfrom29.4millionunitsin2011.
Retailsales
Retailsalestotal$222.7millionin2012,up13.6%from$196millionin2011.
CATEGORYDEVELOPMENT
Markettrends
Thedepilatories,waxes,andbleachescategoryexhibitsastellargrowthof13.2%toreach
Olays exceptional growth in 2012 is the primary reason for the categorys healthy
growth.
Factorssuchasnewproductactivity,formulationimprovements,andinnovationdrive
thecategorysgrowthin2012.
Thereisanincreasingtrendtowardsdoityourself(DIY)athomehairremovalproducts
thatgiveresultsalmostsimilartoasalonservice.
4A32
Newandinnovativeproductactivityin2012aidsgrowthinthecategory.
AllthemajormarketersinthecategoryincludingProcter&Gamble,ReckittBenckiser,
Coty,andChurch&Dwightintroducenewproductsin2012.
Coty,thelargestcontributortothecategoryssales,introducestheSallyHansenSimply
SmoothHairRemoverCrmeandSallyHansenZeroBumpsBikiniSprayvariants.
Church&DwightintroducestheNairBrazilianSpaClayproductlinecomprisingtheNair
BrazilianSpaClayBodyCream,NairBrazilianSpaClayRollOnWax,andNairBrazilian
SpaClayFaceCream.
NadsinnovativeNoseWaxforMen&Womenisafirstofitskinddepilatoryfornose
hairremoval.TheproductcomeswithapatentpendingSafetipapplicator.
ReckittBenckiserin2012introducestheVeetHighPrecisionFacialWax,enrichedwith
almondoilandaloeVeratoremoveunwantedhairindelicateareas,suchastheupper
lip,chin,andeyebrows.Itcomesinaprecisiontubeapplicatorwhichcontrolstheflow
ofthewax.
Marketers increasingly introduce their products in innovative and easytouse
packagingformatstomakeiteasyforconsumers.
Procter & Gambles Olay does exceptionally well in 2012 in the depilatories, waxes, and
bleachesmarket.
Olaysgiganticincreaseisthekeyreasonbehindthecategoryshealthygrowth.
Inlate2011,Procter&Gambleenteredthefacialdepilatoriessegment,withthelaunch
of its Olay Smooth Finish Facial Hair Removal Duo for Fine to Medium Hair, which it
supportedbyatraceablemediaexpenditure(TME)of$11.5millioninitslaunchyear,
whichhelpedthesalesofthebrandtakeoff.
In2012,themarketerexpandsOlaysofferingsinthedepilatories,waxes,andbleaches
market with the introduction of the Olay Smooth Finish Facial Hair Removal Duo for
MediumtoCoarseHair,avariantoftheoriginalOlaySmoothFinishFacialHairRemoval
DuoforFinetoMediumHair.
Olays Smooth Finish Facial Hair Removal Duo for Medium to Coarse Hair is well
accepted by the consumers. The growth of the product is due to good marketing
support, with a TME of $30.1 million in 2012, primarily in the form of television and
Also positioning these products alongside other Olay skin care products in many
retailersbooststhepurchaseofdepilatoriesbywomenwhotraditionallydonotshop
forsuchproducts.
Depilatoriescontinuetobetheleadingsegmentinthecategory.
Theeaseofuseascomparedtothetraditionalwaxproductsleadstotheirsuccess.
Depilatory products in the form of inshower products and hairremoving sprays are
gainingprominenceinthecategoryduetotheconvenienceofusingtheseproducts.
4H33
4H34
Waxescontinuetodowellin2012.
Consumers are increasingly shifting towards the use of wax products due to the
advanced technology used behind these products and the ease of convenient
applicationincomparisontothetraditional,difficulttoapplywaxproducts.
Many consumers choose cold wax over hot wax products; however, the hot wax
segmentisgrowingnoticeablyin2012.
The cold wax segments major performer is the easytouse wax strips, making it
convenient for consumers to use these products thereby saving them the bother of
warminganddealingwithhotwax.
A few variants in the cold wax segment include Veets ReadytoUse Wax Strip Hair
Remover available in Bikini, Underarms & Face and Leg & Body variants, Nads Body
Wax Strips available in Normal Skin, Dry Skin, and Sensitive Skin variants, and Sally
HansenshairRemoverWaxStripKitsavailableforBodyandFace.
Although wax products are time consuming, they often give smoother and longer
lastingresultsthandepilatories.
Moreover,thewaxproductsavailableinthemarketcomeinaneasytoapplyformat,
makingitlessmessyandmoreconvenientfortheconsumers.Someoftheseproducts
availableinthemarketincludeNairsMilk&HoneyRollOnWax,VeetsPrecisionFacial
WaxHairRemover,andNadsNoseWaxforMenandWomen.
Productsthatareeasytoapplyandprovideresultsinlesstimeareprovingmoresuccessful
inthemarket.
Nads Nose Wax For Men and Women comes with a Safetip applicator that makes it
easyforproductapplication.
SallyHansensZeroBumpsBikiniSpraycomesinasprayformatthatcanbetargeted
towardshardtoreachareas.
Nairs Brazilian Spa Clay RollOn Wax requires the wax to be heated and rolled on to
skinforhairfreeskin.Additionally,therollonapplicatorisclaimedtobeeasytouse
andmessfree.
NairsBrazilianSpaClayFaceCreamcomeswithahandsfreeprecisiontipapplicator
thatissaidtoprovideresultsinaslessasfiveminutes.
Hairremovalproductsenrichedwithnaturalingredientsarebecomingmorecommonwith
themarketers.
Ingredients,suchasaloeVera,almondoil,chamomile,honey,andvitaminEaresome
ofthemostcommonlyfoundnaturalingredientsinhairremovalproducts.
Consumers seek hair removal products with natural ingredients with the hope of
evadingtheburningandirritationsensationscausedbyproductsthatareformulated
withharshsyntheticchemicals.
Theseorganicproductsarenotonlyusedbyconsumerswithsensitiveskinbutothers
aswell.
NairsBrazilianSpaClaylineofproductsisenrichedwithmangobutter,acaiberry,and
mineralrichclay.
4A34
Furthergrowthinthecategoryisoffsetbyanumberoffactors.
With the recovering economy, consumers have started visiting salons for a more
relaxingexperienceandprofessionalresults.
The higher income segment of the society continues to visit salons for their hair
removalregimenratherthanusingcheaperalternativesofDIYdepilatories,waxes,and
bleaches.
Alternate hair removal treatments, such as laser treatments, guaranteeing close to
permanenthairremovalresultsalsohindersthecategorysgrowth.Theseservicesare
becoming less expensive due to increased competition and technological
advancements.
Themarketforathomebeautydevicesofferingelectronicallyenableddevicesforuse
intheconvenienceofthecustomershomealsorestrictsfurthergrowthinthecategory.
Notablenewproducts
Table4H16:SelectNewDepilatories,Waxes,andBleachesIntroducedintheUnitedStatesin2012
Company
Brand
Description
Church&Dwight
Nair
BrazilianSpaClayBodyCreamisenrichedwithmangobutter,acaiberry,mineralrich
clay.InfusedwiththeShowerPowerTechnologywhichhelpspreventthecreamfrom
rinsingoffwhileintheshower.Additionally,theconvenientpumpandspongemakes
theapplicationandthehairremovalprocesseasyandhandsfree
Church&Dwight
Nair
BrazilianSpaClayRollOnWaxisinfusedwithmangobutter,acaiberry,andmineral
richclay.Itcomeswitharollonapplicatorforamessfreeapplication
Church&Dwight
Nair
BrazilianSpaClayFaceCreamisenrichedwithmangobutter,acaiberry,andmineral
richclaytogivesmoothhairfreeskinwithinaslittleasfiveminutes,dermatologically
tested
Coty
SallyHansen
SimplySmoothHairRemoverCrmeisawaterresistanthairremovalcrmethat
staysonintheshower,formulatedwithodorlesstechnology,givesresultsinjust
threeminutes,andresultslastuptosixdays
SallyHansen
ZeroBumpsBikiniSpraysoothesandeliminatesbumpsandirritationassociatedwith
hairremoval,preventsingrownhair.Itisenrichedwithaloeandorangeflower
whichprovidemoisturizationbenefits,andisavailableinsprayformatwhichprovides
convenientapplication
Olay
SmoothFinishFacialHairRemovalDuoMediumtoCoarseHair.Gentletwostep
systemthatremovesunwantedfacialhair,theskinguardingbalmactsasaprotective
barrieragainstthedirectcontactofthehairremovalcream,whilethecream
removestheunwantedhair
Veet
HighPrecisionFacialWaxisspeciallyformulatedwaxtoremoveunwantedhairin
delicateareas,suchaseyebrows,upperlip,andchin,enrichedwithalmondoiland
aloeveratomoisturizetheskin.Easytousetubeprecisionapplicatorcontrolsthe
flowofthewax
Nads
NoseWaxForMen&Womenisenrichedwithchamomileandaloeextractsto
quickly,easily,andeffectivelyremoveunwantednosehair,blackheadsandcleanse
poresfromthenosesurface.ComeswithaSafetipapplicatorandcanbeusedby
bothmenandwomen
Coty
Procter&Gamble
ReckittBenckiser
SueIsmiel&
Daughters
4H35
4H36
Salesbyproducttype
Depilatoriesretainsitsleadasthelargestsegmentinthecategory,constituting63.8%ofthe
marketsharein2012.
Salesofdepilatoriesgrow16.9%in2012toreach$104millionfrom$89millionin2011.
Thesegmentscategoryshareadvancesfrom61.8%oftotalcategorysalesin2011to
63.8%in2012.
Cotys Sally Hansen and Church & Dwights Nair brands continue to dominate the
segmentwithavarietyofproductofferings.
Olays Smooth Finish Facial Hair Removal Duo, available in two variants, is the key
reasonbehindtheexceptionalperformanceofthissegmentin2012.
Moreover,constantnewproductactivityinthesegmentfromleadingmarketers,such
asCoty,Church&Dwight,andReckittBenckiseraddtothecategoryssalesin2012.
Waxes is the secondlargest segment in the category, accounting for 32.5% of the total
In2012,waxeslosemarketsharefrom34.0%in2011to32.5%in2012;however,the
segmentssalesincrease8.2%from$49millioninto$53millionin2012.
Therecontinuestobemoredemandforcoldwaxesthanhotwaxes;however,thehot
waxessubsegmentgrowsrapidlyin2012aswell.
Coldwaxesaccountforapproximately59%ofthesegmentssales,whiletheremaining
41%comefromthehotwaxes.
In2012,thenewproductsintroducedinthewaxessegmentincludeNairsBrazilianSpa
ClayRollOnWax,VeetsHighPrecisionFacialWax,andNadsNoseWaxforMenand
Women.
Bleaches,thesmallestsegmentinthecategory,represents3.7%ofthetotalcategoryssales
Manufacturerssalesforthesegmentremainflatat$6millionin2012from2011levels.
Althoughthesegmentssalesremainstagnant,itsmarketsharedeclinesin2012,due
tothegrowingsalesinthedepilatoriesandthewaxessegments.
Since the segment does not witness any new or innovative activity from marketers,
suchasJolenwhospecializeinsuchproductofferings,thesegmentstagnates.
4A36
Table4H17:ManufacturersSalesofDepilatories,Waxes,andBleachesintheUnitedStatesby
Product
$Million
2011
%Oftotal
2012
2011
2012
Change,%
Depilatories
89
104
61.8
63.8
16.9
Waxes
49
53
34.0
32.5
8.2
4.2
3.7
144
163
100.0
100.0
13.2
Bleaches
Total
COMPETITION
Bycompany
Cotys Sally Hansen continues to dominate the category with 28.2% of the total market
sharein2012,adeclinefrom31.3%in2011.
Manufacturers sales for the brand advance 2.2% from $45million in 2011 to
$46millionin2012.
Thebrandsgrowthin2012isduetonewproductactivity.Thecompanyintroducesthe
SallyHansenSimplySmoothHairRemoverCrmeawaterresistantformulaformess
free hair removal inshower and the Sally Hansen Zero Bumps Bikini Sprayenriched
withwitchhazel,aloe,andsoyextracttokeepskinsoftandpreventingrownhair.
SallyHansencompetesinallthethreesegmentsofthecategory:depilatories,waxes,
andbleaches.
ThemarketersofferinginthebleachessegmentislimitedtoonlytwoSKUs.
Thecompanyconcentratessolelyonitslineoffemalehairremovalproductsafterthe
discontinuationofitsmenshairremovallineofproductsin2011.
In2012,thecompanylaunchestheGetBareDoubleDareprogramallowingfansto
enterthesweepstakesonSallyHansensFacebookpagewithachancetowinaniPad
and $2,000. The program is designed to promote Sally Hansen's Hair Remover Wax
StripKitforFace,thenewZeroBumpsBikiniSpray,andthenewSimplySmoothHair
Remover.
4H37
4H38
Church&DwightsNairisthesecondlargestbrandinthecategory,withsalesat$45million
in2012,up7.1%from42millionin2011.
Nairsmarketsharereducesfrom29.2%in2011to27.6%in2012.
Thekeyreasonforthemarketershealthygrowthin2012isaccreditedtothelaunchof
itsBrazilianSpaClaylineofproducts.ThelinecomprisesBrazilianSpaClayBodyCream,
BrazilianSpaClayRollOnWax,andBrazilianSpaClayFaceCream.
Nairsportfolioofproductsforwomenincludesinshowerproducts,waxes,andcreams
and gels. These products are available in different variants with some especially
designedasasensitiveformula.
NairsproductofferingsformenarelimitedtotheNairforMenSpray,InShowerNair
ForMen,andNairForMenBodyCreamsincedepilatoriesisanichesegmentforthe
maleconsumers.
Meningeneralarenotloyaltoadepilatorybrandandtendtopickupanythingthat
would catch their attention first. In many cases, men trade down to privatelabel
depilatoryproductsduetothelowerpricedoption.
ReckittBenckisersVeetpostsa4.0%growthin2012toreach$26millionin2012,upfrom
$25millionin2011.
Veet is distantly placed as the thirdlargest marketer in the depilatories, waxes, and
bleachescategory.
Veetsmarketsharedeclinesfrom17.4%in2011to16.0%in2012.
The marketers growth in 2012 is the result of the good performanceof its SprayOn
Cream Hair Remover Sensitive Formula with Aloe Vera & Vitamin E, Spray On Cream
Hair Remover with Essential Oils, and ReadytoUse wax Strips Hair Remover Legs &
Body,andtheintroductionoftheHighPrecisionFacialWaxproduct.
Olay(Procter&Gamble)recordsanenormousgrowthat375.0%in2012.
Manufacturerssalesforthebrandadvancefrom$4millionin2011to$19millionin
2012.
Olays offering in the depilatories, waxes, and bleaches category consists of a single
product, the Smooth Finish Facial Hair Removal Duo. Currently, the Smooth Finish
FacialHairRemovalDuoisavailableintwovariants:oneforfinetomediumhairand
theotherformediumtocoarsehair.
The Smooth Finish Facial Hair Removal Duo for Medium to Coarse Hair is, however,
launchedin2012afterthesuccessoftheinitiallaunchoftheSmoothFinishFacialHair
RemovalDuoforFinetoMediumHairin2011.
SalesforOlaybenefitsfromastrongdistributionmodelanditsproductsareavailable
acrossallmajorretailmasschannels,suchasWalmart,Walgreens,andCVS/Pharmacy.
The brand has a higher price point than competing products, because of the trusted
Olayname.Thisalsocontributestothesteepdollarincreaseinsales.
4A38
Nads(SueIsmiel&Daughters)salesdecline20.0%in2012.
The companys sales decline to $8 million in 2012, down 20.0% from $10 million in
2011.
Nadsmarketsharedeclines200basispointsfrom6.9%in2011to4.9%in2012.
Nadsoffersproductsforbothmenandwomen.
Inspiteofthelaunchofafirstofitskind,NoseWaxforMenandWomeninthemarket
in2012,thecompanyfailstorecuperateitsoverallsales.
Additionally,Nadslowemphasisonmarketing,withaminimalTMEof$1million,aids
itsdeclinein2012.
The brands decline in sales is also a result of the increasing competition from other
leadingbrandsandespeciallytheentryofOlayinthemarket.
Privatelabelproductssalesremainflatat$3millionin2012,fromthe2011levels.
Theseproductsaccountfor1.8%shareofthetotalcategoryssalesin2012,downfrom
2.1%in2011.
Of all the segments in the category, consumers most often purchase privatelabel
bleaches,sincebleachingisarelativelypainfreemethodandtheriskfactorisminimal.
However, many consumers are wary of using less expensive and lowquality private
label depilatories and waxes due to the fear of a bad experience with respect to
discomfort,pain,andirritationassideeffects.
RETAILDISTRIBUTION
Theshareofretailoutletsinthecategoryundergoesminorchangesin2012.
Drug stores continue to be the leading retail outlet in the category with a 46.0%
contributionfollowedbymassmerchandisers.
Massmerchandisers,inthesecondlead,accountsfor43.0%ofthetotalretailsalesin
2012, up from 42.0% in 2011. The enormous growth of Olay, which is mainly
distributedthroughmassmerchandisers,isthekeyreasonbehindtheincreaseinthe
shareofthedistributionchannel.
Foodstoresisthethirdlargestretailchannelforthecategoryrepresenting8.0%ofthe
totalcategoryssales,flatfrom2011levels.
The sales proportion of the direct sales retail channel declines from 3.0% in 2011 to
2.0%in2012.
4H39
4H40
Table4H18:ManufacturersSalesofDepilatories,Waxes,and
BleachesintheUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Drugstores
46
46
Massmerchandisers
42
42
Foodstores
10
Directsales
Specialtystores
100
100
Total
MARKETINGACTIVITY
TMEforthedepilatories,waxes,andbleachescategoryisestimatedtogrowat36.7%from
$42millionin2011,to$57.4millionin2012.
Procter & Gamble is the leading marketer in TME, with an advertising expenditure at
$30.1millionin2012.
The marketer entered the category in 2011 with Olays Smooth Finish Facial Hair
RemovalDuo.
Procter&Gamblespends$15.8milliononmagazineadvertisementsand$12.9million
ontelevisionadvertisements.
Olayspresenceonsocialmedianetworks,suchasFacebook,helpsspreadawareness
aboutitsproductsthatcompeteinthedepilatories,waxes,andbleachescategory.
OlayswebsitealsopromotestheSmoothFinishFacialHairRemovalDuobyeducating
consumersabouthairremovalfactsandmythsandbyprovidingvideosandarticlesby
professionalestheticians.
Consumersinterestedinreceivingregularupdatesaboutthebrandshappeninginthe
formofspecialoffers,events,sweepstakes,giveaways,andinsiderinformationcanjoin
theOlayClubthroughthebrandswebsite.
4A40
ReckittBenckisersupportsitsVeetlinewithaTMEof$5.8millionin2012.
Themarketersexpenditureontelevisionadvertisementsare$4.2millionin2012.
Magazineexpendituresfollowcloselyat$1.6million.
VeetsReadytoUseWaxStripsreceiveaTMEof$4.6millionin2012.
Veetoffersdiscountcouponsworth$2.00onitswebsite.
The brands website sports the Veet EMail Club that provides tips, offers, and
informationaboutitsproductstoitsmembers.
Reckitt Benckiser also utilizes social media networks, such as Facebook, Twitter, and
YouTube to spread awareness and gain a medium of personal communication with
consumers.
YouTubefeaturesnumeroushowtodovideosaidingconsumersinproductusage.
In2012,thecompanypartnerswithCherylBurke,acelebrityballroomdancingproand
televisionpersonality,topublicizeitsReadytoUseWaxStripsforFaceandBodyand
theHighPrecisionFacialWax.
Church&DwightsTMEdecreasesto$4.5millionin2012from$7.4millionin2011,down
39.6%.
Majority of its TME, $2.9million, is spent on television advertisements. Television
advertisementexpendituresaccountfor64.4%ofthetotalTME.
Themarketeralsospends$2.2milliononmagazineadvertisements.
The Nair Brazilian Spa Clay hair removal line receives most of the brands TME at
approximately$3.0millionin2012.
Nairs website offers a discount coupon of $3.00 on the purchase of any two Nair
products.
The website offers writeups on the advantages of using athome Nair hair removal
productsasagainstvisitingsalons,guidetoobtainingbeautifulskin,andotheruseful
informationontheuseofproducts.
Nairs men and women products are classified separately on its website, making it
easierforconsumerstotracetheproductappropriateforthem.
DetailsonTMEbybrandareincludedintheAdvertisingsectionofthisreport.
4H41
4H42
OUTLOOK
Thedepilatories,waxes,andbleachescategoryisexpectedtowitnessmoderategrowthof
Olayisexpectedtocontinuetogrowitssalesbyexpandingitslineofproducts.Further,
Olayisexpectedtoforayintoothersegments,suchaswaxesandbleachesduringthe
Marketers ability to innovate with products and make them available in convenient
easytousepackagingformatswilldrivesalesinthecategory.
Depilatory products formulated with natural ingredients will continue to gain
popularity,withmarketersincreasinglyintroducingsuchproducts.
However, inadequate marketing support from marketers for their new products and
theexistingproductportfolioisexpectedtorestrictfurthergrowthinthecategory.
Competitionfromalternatehairremovaltreatments,suchassalonservices,laserhair
removaltreatments,andathomehairremovaldeviceswillalsohinderthecategorys
Marketerswillhavetoinnovatewithproductsforthecategorytopostgrowth.
Innovationsintheformofnewandimprovedformulations,attractivepackaging,easy
touseformats,andnaturalingredientswillplayanimportantroleintheoverallsales
growthofthecategory.
Inshower products and sprays are popular among consumers and with the
introductionofvariants,moresuccessisexpectedinthissegment.
Asmenbecomemoreconsciousoftheirgroomingneeds,andbegintoestablishaskin
careregimen,morearelikelytostartusinghairremovalproducts.However,onlythe
depilatoriesandwaxessegmentswouldapplytothemaleconsumers,withmajorityof
themchoosingdepilatoriesoverwaxesduetothepainfactorinvolvedwiththewaxing
procedure.
Marketers interested in venturing into the mens segment will have contradictory
examplestogainalearningexperiencefromwiththefailureofSallyHansenforMen
andthesuccessofNairsShowerPowerforMen.
SallyHansenforMenwasunsuccessfulincompletehairremoval,exceptthemaximum
strength version which also burnt the consumers skin. However, Nairs product has
had more success due to its more effective formula and pleasant smell than the
competitorsproducts.
Olayislikelytopostahealthygrowththrough2017.
Thebrandisexpectedtolaunchmorevariantstoitsexistinglineofproductsoverthe
nextfiveyears.
There is a likelihood that the brand will venture into other segments, such as waxes
andbleachesinanattempttocompetewithotherbrandsinthecategoryandtryand
capturegoodmarketshare.
The marketer will continue to have good marketing support for its new product
introductionswithprintandtelevisionadvertisementsasthemainmediums.Also,Olay
couldpossiblysignacelebritytoendorseitsproductsinthecategory.
4A42
Marketers will be required to increase marketing expenditures to support their evolving

productportfoliosandgeneratedemand.
Marketers might be influenced by Procter & Gamble to follow the kind of marketing
supportitgivestheOlaybrand.
However, all marketers are unable to provide large marketing support for the
depilatories,waxes,andbleachescategory.
Companieswouldincreasinglyresorttousinglessexpensiveandvirtualsocialmedia,
suchasFacebook,Twitter,andYouTube,whicharehighlypopularamongthemasses.
Similar to the other categories in the cosmetics and toiletries industry, marketers are
expectedtoinnovatewithnaturalandorganicproductstosupporttheirsalesincrease.
As consumers gain awareness about the adverse effects of the synthetic chemicals
used in products, they make a shift towards the use of products formulated with
naturalandorganicingredients.
Some of the commonly found natural ingredients in depilatories and bleaches
formulationsincludealoevera,cocoabutter,almondoil,andvitaminE.
Cotys Sally Hansen, Church & Dwights Nair, and Reckitt Benckisers Veet already
possess products that are formulated with natural ingredients and are expected to
expandtheirproductlinesoverthefiveyearforecastperiod.
Manufacturers sales in the category are expected to increase at a CAGR of 3.7% from
$163millionin2012toarounded$195millionin2017.
UnitvolumeisprojectedtogrowataCAGRof3.5%from33.2millionpackagesin2012to
4H43
4H44
4A44
PERSONALCLEANSINGPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
In 2012, the personal cleansing products category displays an overall growth of 3.0% to
reach$4,026millioninsalesatmanufacturerslevel,upfrom$3,907millionin2011.
The body washes segment continues to be the major contributor to the categorys
growth,postingthehighestgrowthat3.4%in2012.
The body washes segment dominates the personal cleansing products category with
thesegmentssalesat$1,354millionin2012,upfrom1,310millionin2011.
Growthoftheliquidsoapssegmentisduetotheaddedbenefitsintheseproductsas
comparedtobarsoaps.
Table4H19:HistoricalSalesofPersonalCleansingProducts
Year
$Millionr
Change,%
2007
3,473
2008
3,558
2.4
2009
3,686
3.6
2010
3,792
2.9
2011
3,907
3.0
2012
4,026
3.0
rRestated.
4H46
PersonalCleansingProducts
Table4H20:ManufacturersSalesofPersonalCleansingProductsintheUnitedStatesbyProductTypeandBrand,2011and2012
Producttype/brand
Company
$Million
BODYWASHES
Dove
Unilever
202
214
15.4
15.8
5.2
5.3
Suaver
Unilever
129
133
9.8
9.8
3.3
3.3
Dialr
Henkel
116
118
8.9
8.7
3.0
2.9
Olay
Procter&Gamble
101
110
7.7
8.1
2.6
2.7
OldSpicer
Procter&Gamble
104
105
7.9
7.8
2.7
2.6
Softsoap
ColgatePalmolive
87
89
6.6
6.6
2.2
2.2
Axe
Unilever
80
79
6.1
5.8
2.0
2.0
Caressr
Unilever
61
69
4.7
5.1
1.6
1.7
Nivea
Beiersdorf
43
44
3.3
3.2
1.1
1.1
Aveeno
Johnson&Johnson
40
38
3.1
2.8
1.0
0.9
St.Ives
Unilever
38
36
2.9
2.7
1.0
0.9
IrishSpringr
ColgatePalmolive
35
33
2.7
2.4
0.9
0.8
Neutrogena
Johnson&Johnson
25
29
1.9
2.1
0.6
0.7
Toner
Henkel
23
24
1.8
1.8
0.6
0.6
Gillette
Procter&Gamble
24
20
1.8
1.5
0.6
0.5
Ivory
Procter&Gamble
14
16
1.1
1.2
0.4
0.4
WhiteRainr
BrynwoodPartners
14
15
1.1
1.1
0.4
0.4
Zestr
BrynwoodPartners
12
13
0.9
1.0
0.3
0.3
Lever2000
Unilever
0.7
0.5
0.2
0.2
Adidas
Coty
0.5
0.4
0.2
0.1
GoldBond
Sanofi
0.4
0.3
0.1
0.1
Coast
BrynwoodPartners
0.1
0.1
Johnson's
Johnson&Johnson
0.1
0.1
89
95
6.8
7.0
2.3
2.4
2011
Privatelabelr
Allother
2012
%Ofsegment
2011
%Oftotal
2011
2012
51
54
3.9
4.0
1.3
1.3
Totalr
1,310
1,354
100.0
100.0
33.5
33.6
BARSOAPS
Dove
Unilever
440
466
35.5
36.8
11.3
11.6
Dial
Henkel
188
184
15.2
14.5
4.8
4.6
IrishSpring
ColgatePalmolive
106
110
8.6
8.7
2.7
2.7
Caressr
Unilever
68
68
5.5
5.4
1.7
1.7
Olay
Procter&Gamble
63
60
5.1
4.7
1.6
1.5
Lever2000
Unilever
59
58
4.8
4.6
1.5
1.4
Ivory
Procter&Gamble
53
51
4.3
4.0
1.4
1.3
Zest
BrynwoodPartners
41
46
3.3
3.6
1.0
1.1
Bath&BodyWorks
LimitedBrands
18
19
1.5
1.5
0.5
0.5
Safeguard
Procter&Gamble
17
16
1.4
1.3
0.4
0.4
L'Occitane
L'Occitane
13
14
1.0
1.1
0.3
0.3
(Continued(
4A46
2012
4H47
Producttype/brand
Company
$Million
BARSOAPS(Continued)
Coast
Palmoliver
Tone
Henkel
Yardleyr
Lornamead
PrimalElements
2011
2012
%Ofsegment
2011
2012
%Oftotal
2011
2012
BrynwoodPartners
11
12
0.9
0.9
0.3
0.3
ColgatePalmolive
12
0.6
0.9
0.2
0.3
10
10
0.8
0.8
0.3
0.2
0.7
0.7
0.2
0.2
PrimalElements
0.7
0.7
0.2
0.2
Aveeno
Johnson&Johnson
0.6
0.6
0.2
0.2
Jergens
Kao
0.6
0.4
0.2
0.1
Tom'sofMaine
ColgatePalmolive
0.3
0.4
0.1
0.1
Avon
Avon
0.2
0.2
0.1
0.1
Basis
Beiersdorf
0.2
0.2
0.1
Camay
Procter&Gamble
0.2
0.2
0.1
Neutrogenar
Johnson&Johnson
0.2
0.1
0.1
Lava
WD40
0.2
0.1
Pure&Natural
BrynwoodPartners
0.1
Privatelabel
23
24
1.9
1.9
0.6
0.6
Allother
72
75
5.8
5.9
1.8
1.9
Totalr
1,239
1,268
100.0
100.0
31.7
31.5
BATHADDITIVES
Bath&BodyWorks
LimitedBrands
197
212
31.8
33.2
5.0
5.3
Avon
Avon
87
78
14.0
12.2
2.2
1.9
VictoriasSecretGarden
LimitedBrands
49
50
7.9
7.8
1.3
1.2
BurtsBees
TheCloroxCompany
35
37
5.6
5.8
0.9
0.9
Aveeno
Johnson&Johnson
25
26
4.0
4.1
0.6
0.6
Philosophy
Coty
14
15
2.3
2.4
0.4
0.4
TheBodyShop
L'Oral
14
14
2.3
2.2
0.4
0.3
Neutrogena
Johnson&Johnson
13
13
2.1
2.0
0.3
0.3
VillageNaturals
MinnetonkaBrands
1.5
1.4
0.2
0.2
L'Occitane
L'Occitane
1.1
1.4
0.2
0.2
Origins
EsteLauder
1.1
1.3
0.2
0.2
Dr.Teals
Dr.TealsTherapeutic
Solutions
1.1
1.3
0.2
0.2
Crabtree&Evelyn
Crabtree&Evelyn
1.3
1.3
0.2
0.2
MaryKay
MaryKay
1.1
1.1
0.2
0.2
Lander
GrandBrands
1.1
1.1
0.2
0.2
Bliss
SteinerLeisure
1.0
1.1
0.2
0.2
BlueQ
BlueQ
1.1
0.9
0.2
0.1
TheHealingGarden
YellowWoodPartners
0.8
0.8
0.1
0.1
Cosrich
Cosrich
0.8
0.6
0.1
0.1
(Continued(
REPRODUCTIONORDISCLOSUREFORBIDDEN;SEESPECIAL NOTICE KLINE&COMPANY,INC.
4H48
Producttype/brand
Company
$Million
2011
2012
%Ofsegment
2011
2012
%Oftotal
2011
2012
BATHADDITIVES(Coyinued)
Calgon
YellowWoodPartners
0.6
0.6
0.1
0.1
Vitabath
RichBrands
0.6
0.6
0.1
0.1
Unilever
0.6
0.6
0.1
0.1
MZB
MZBPersonalCare
0.5
0.5
0.1
0.1
KidCare
CosmeticEssence
0.3
0.3
0.1
Privatelabel
22
23
3.5
3.6
0.6
0.6
Allother
72
75
11.6
11.8
1.8
1.9
620
638
100.0
100.0
15.9
15.8
Total
LIQUIDSOAPS
Softsoap
ColgatePalmolive
Dialr
209
215
35.5
34.9
5.3
5.3
Henkel
81
92
13.8
14.9
2.1
2.3
Bath&BodyWorks
LimitedBrands
78
84
13.3
13.6
2.0
2.1
Method
Method
23
28
3.9
4.5
0.6
0.7
Ivoryr
Procter&Gamble
0.9
0.6
0.1
0.1
Jergens
Kao
0.2
0.2
Kandoo
Procter&Gamble
0.3
0.2
0.1
Johnson'sBaby
Johnson&Johnson
0.2
Privatelabelr
145
146
24.7
23.7
3.7
3.6
Allother
43
45
7.3
7.3
1.1
1.1
588
616
100.0
100.0
15.0
15.3
Totalr
ANTIBACTERIALHANDGELS
Bath&BodyWorks
LimitedBrands
41
44
27.3
29.3
1.0
1.1
Purell
GojoIndustries
39
40
26.0
26.7
1.0
1.0
GermX
ViJohnLaboratories
5.3
4.0
0.2
0.1
Dial
Henkel
2.0
1.3
0.1
Privatelabelr
51
50
34.0
33.3
1.3
1.2
Allother
5.3
5.3
0.2
0.2
Totalr
150
150
100.0
100.0
3.8
3.7
TOTALr
3,907
4,026
100.0
100.0
rRestated.
Unitsales
Unitsalesofthepersonalcleansingproductsadvance2.8%from1,617millionpackagesin
2011to1,663millionpackagesin2012.
4A48
Table4H21:UnitSalesofPersonalCleansingProductsintheUnitedStatesbyProductSegment,2012
Millionpackages
%Oftotalunits
Segment
2011
2012
2011
2012
Changeinvolume,%
Barsoapsr
788
806
48.7
48.5
2.3
Bodywashesr
434
448
26.8
26.9
3.2
Liquidsoapsr
205
215
12.7
12.9
4.9
Bathadditives
122
125
7.5
7.5
2.5
67
67
4.1
4.0
1,617
1,663
100.0
100.0
2.8
Antibacterialhandgelsr
Totalr
rRestated.
Retailsales
Retail sales of the personal cleansing products category grow 3.1% to $5,871.8million in
2012,upfrom$5,694.7millionin2011.
CATEGORYDEVELOPMENT
Markettrends
Thepersonalcleansingproductscategory,althoughinamaturephase,continuestogrowin
2012.
Availabilityofpersonalcleansingproductsinavarietyofforms,suchasbarsoaps,body
washes,andbathadditivesgivesconsumersawidearrayofoptionstochoosefrom.
Salesofthebodywashesandliquidsoapssegmentsincreasesignificantly,whilesales
ofbathadditivesandbarsoapsincreasemoderately.
Salesoftheantibacterialhandgelssegmentremainstagnantin2012.
Brandloyaltyislowasconsumersdecisionsareruledbythepriceoftheproducts.
Further growth of the category is offset by the good performance of privatelabel
products,makingavailabletoconsumersgoodqualityproductsatlowprices.
4H49
4H50
Categorygrowthcontinuestobedrivenbythestrongperformanceofthebodywashesand
liquidhandsoapssegments.
Manymarketerscontinuetointroducebodywashesinavarietyoffragrances.
In 2012, Lornamead introduces Yardley Skin indulgence Lavender & Rosemary Skin
SoothingBath&ShowerGel,ColgatePalmoliveintroducestheSoftsoapCitrusSplash&
Berry Fusion Moisturizing Body Wash, CaswellMassey introduces the Fig & bamboo
FoamingBodyWash,UnileverintroducestheCaressEndlessKissSilkeningBodyWash,
andSuaveEverlastingSunshine.
Also in 2012, The Clorox Company launches the Gd range of products comprising,
among other products body washes in an array of five fragrances: Red Ruby Groovy,
PeranormalActivity,OrangePetalooza,FloralCherrynova,andVanillaFlame.
Thecategorysgrowthisalsodrivenbythegoodperformanceofnaturallypositioned
body wash formulations comprising greater proportions of natural or organic
ingredientsincomparisontotheconventionalbodywashes.
AfewofthenaturallypositionedbodywashesavailableinthemarketincludeStIves
DeepMoistureTripleButtersCreamyCoconutenrichedwithjojoba,Shea,andcoconut
butter; andBurts Bees Naturally Nourishing Milk & Shea Butter Body Wash enriched
withsafflowerseedoleosomes.
In2012,LornameadintroducestheSkinIndulgenceSeaMineralsSkinSmoothingBath
&ShowerGelwhichisenrichedwithseakelpandnaturalexfoliants.
Growth in the liquid soaps segment is driven by a number of new launches in 2012.
ColgatePalmoliveintroducestheSoftsoapPamperedHandsCoconutLimeLiquidHand
Soap and Henkel introduces the Dial Natural Tangerine & Guava Moisturizing Liquid
HandSoap.
Although sales of bar soaps grow in 2012, further growth of the segment is negatively
affectedbythegrowingpopularityofbodywashes.
Acertainproportion of thepopulationprefersbarsoapsoverthehigherpricedbody
washestherebydrivingsalesforthebarsoapssegmentin2012.
A few of the new variants introduced in 2012 include Aubrey Rosas Mosqueta
LuxuriousBathBar,CaswellMasseysVerbenaandLavenderBarSoaps,andYardleys
SkinIndulgenceMango&CreamBodyButterCleansingBar.
However, further growth in the bar soaps segment is negatively affected by the
marketers inability to continually innovate with product offerings in the segment to
preventshiftingtobodywashes.
4A50
The category continues to witness fierce competition with respect to pricing of products
andattainingbrandloyaltyamongconsumers.
Brand loyalty continues to be a major area of concern for marketers in the personal
cleansing products category as consumers increasingly change their preference for
brandsbasedontheproductpricing
Thelowpricedprivatelabelproductsposeathreattotheproductsmanufacturedby
wellestablished national brands as consumers continue to be pricesensitive while
purchasingpersonalcleansingproducts.
Additionally, privatelabel manufacturers expand their personal cleansing range of
productsbymakingthemavailableinavarietyoffragrancesandofferingmoisturizing
benefits,inlinewiththeestablishedmarketers,therebymakingiteasierforconsumers
totradedowntothelessexpensiveprivatelabelproducts.
Overall,thecategorycontinuestobecompetitive,withmarketerscontendingforbrand
loyalty from consumers in terms of pricing, marketing, packaging, and new product
offerings.
In an attempt to innovate, marketers increasingly introduce genderspecific personal

cleansingproducts.
Marketerslookatvariousmeanstoenticeconsumerstowardstheirproductofferings,
one of them being the introduction of separate personal cleansing products for men
andwomen.
Thepersonalcleansingproductsdesignedforwomenaremilderthanthosedesigned
for men and are generally available in a variety of fragrances. Marketers infuse the
personal cleansing products targeted towards women with floral fragrances,
moisturizingbenefits,andnaturalingredients.
While the personal cleansing products designed for men have more masculine
fragrances, some are formulated with technology that helps fight odor, and in some
cases provide multifunctional benefits, such as acting as a shampoo, face wash, and
bodywashsimultaneously.
Leading brands, such as Axe, Adidas, Irish Spring, Old Spice, Dove Men+Care, and
Gillettearetargetedtowardsmen.
Withrespecttomalespecificproducts,bodywashesgrowinpopularity.
In2012,UnileverintroducestheDoveMen+CareCleanDefenseBody&FaceWashand
Fresh Awake Body & Face Wash. Doves range of Body & Face Wash are formulated
withMicromoistureTechnologythatisclinicallyproventofightskindryness.
Alsoin2012,CotysAdidasintroducestheAdidasHair&Body3,arangeofproducts
that provides tripleaction results by cleansing and refreshing the skin while
conditioningthehair.Therangeofproductsisavailableinthreevariants:AfterSport,
ExtraFresh,andActiveStart.
4H51
4H52
Salesintheantibacterialhandgelssegmentremainconstantin2012.
Sales in the segment stagnate as consumers become less preoccupied with
antibacterialgel,comparedtothesegmentssurgein2009and2010duetothescare
oftheH1N1flu.Thedormantsalesinthesegmentisattributedtothecurrentdearthof
pandemics.
Antibacterialhandgels maketheskindryduetothealcoholcontent, contributingto
theslowingsalesinthesegment.
Furthermore, concerns about triclosan, the main ingredient in many of the products,
havenotabatedandthereforenegativelyaffectthesegmentssales.
Thetrendtowardsnaturallypositionedproductscontinuestogathermomentum.
Naturallyformulated products gain acceptance as consumers increasingly become
health conscious and try and incorporate the trend of health and wellness in their
personalhygieneregimen.
These naturallyformulated personal cleansing products contain lower levels of
synthetic ingredients as compared to the conventional personal cleansing products
availableinthemarket.
Duetothematurephasethatthecategoryisin,innovationplaysasignificantroleforthe
categorysgrowth.
Innovation in the form of substance, texture, fragrance, packaging, and added value
willhelpdrivesalesinthepersonalcleansingproducts.
Productofferingscontainingbenefitsinadditiontothebasiccleansingandmoisturizing
functionshasbecomeatrendinthemarket.Consumershavebecomeusedtothebasic
functions and expect more benefits from personal cleansing products in the form of
skinnourishment,improvedskinhealth,andbeautyenhancement.
Fragrancescontinuestoplayasignificantroleinthegrowingsalesofthecategorydue
tothemarketersinitiativestoexpandtheirpersonalcleansingrangeofproductswith
variantsincreativeandexoticfragrances.Someareespeciallydesignedforeachseason.
During the spring and summer seasons, marketers introduce floral and refreshing
fragranced personal cleansing products while during autumn and winter, personal
cleansingproductswithspicierorheavierfragrancesareintroduced.
Bath & Body Works spring and summer body washes collection includes Wild Citrus
SunflowerShowerGel,WildPeachPoppiesShowerGel,CarriedAwayShowerGel,and
CoconutLimeBreezeShowerGelwhileitsbodywashessuitedforuseduringautumn
andwinterincludeSensualAmberShowerGel,SweetCinnamonPumpkinShowerGel,
CashmereGlowShowerGel,andTwilightWoodsShowerGel.
Marketers also regularly change the packaging of their product lines to make them
more attractive and give them a fresh appearance. This helps develop curiosity and
leadspeopletobuycertainproducts.
Moreover,marketersalsobringaboutchangestotheformulationsoftheirexistingline
ofproductbyenrichingthemwithmoreadvancedtechnologyorsuperioringredients
toprovidemoreefficaciousresultsinlessertime.
4A52
Sales of privatelabel products continue to grow during 2012, driven by a wide variety of
productsavailableatlowpriceofferings.
Privatelabelproductsareperceivedasgoodqualityproducts,backedbyanaggressive
pushfromretailers.
Retailers support privatelabel products by giving them prime shelf space next to
establishedbrandsproducts.
Additionally, private labels work in close contact with the retailers and develop
products based on the feedback they receive from the retailers, who are able to
provideatruepictureabouttheneedsanddemandsofconsumers.
Despitetheeconomicrecovery,consumerscontinuetobepricesensitiveforproducts
thatsatisfytheirbasicneeds.
M&Aactivity
In2012,BrynwoodPartners,throughitsportfoliocompaniesacquiresbrandsacrossthethe
entirecosmeticsandtoiletriesmarket.
Brynwood Partners through its portfolio company, Golden Sun acquires the Pure &
Natural brand from The Dial Corporation, a subsidiary of Henkel. Pure & Naturals
rangeofproductsincludeliquidhandsoapsandbodywashes.
BrynwoodPartnersthroughitsportfoliocompanyHighRidgeBrandsacquirestheCoast
personalcleansingbrand.
Coastwaslaunchedin1975anditsproductsareofferedunderthebarsoapsandbody
washessegments.
Brynwood Partners through its portfolio company High Ridge Brands acquires the
WhiteRainbrandfromSunProducts.
White Rain was launched by Gillette in 1952. White Rain offers a diverse range of
productsincludingshampoos,conditioners,bodywashes,andhairstylingproducts.
4H53
4H54
Notablenewproducts
Table4H22:SelectNewPersonalCleansingProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
AubreyOrganics
Aubrey
RosaMosquetaLuxuriousBathBarisinfusedwithorganicrosamosquetaoilandborageoil
CaswellMassey
CaswellMassey
Fi&BambooCollectioncomprisesafoamingbodywashandbarsoap.Theproductsareenrichedwitha
blendofmarulaoil,mirabellaplumoil,andedelweissandswisswatercressextracts
CaswellMassey
CaswellMassey
LavenderBarSoapisformulatedwithlatheringvegetablebaseandperfumegradeoilstocleansetheskin
withoutleavingitdry
CaswellMassey
CaswellMassey
VerbenaBarSoap,formulatedwithlatheringvegetablebase,cleansestheskinwithoutleavingtheskin
dry
Colgate
Palmolive
Softsoap
Scensationsisalimitededitionlineofbodywasheswhichareinfusedwithseasonalfruitscentsand
moisturizingingredientstokeeptheskinhydrated.ItisavailableinJasmineOasisandLemonadeBerry
Splash
Colgate
Palmolive
Softsoap
CitrusSplash&BerryFusionMoisturizingBodyWashisenrichedwithamoisturizingformula,energizing
fragrance,andberryextracts
Colgate
Palmolive
Softsoap
PamperedHandsCoconutLimeLiquidHandSoapisenrichedwithmoisturizingingredientstocleansethe
handsandisavailableincoconutandrefreshinglimescent
Colgate
Palmolive
Softsoap
AntibacterialHandSoapwithMoisturizersisclinicallyproventoeliminate99.9%ofbacteriawhileleaving
theskinmoisturized.Itisavailableintwoscents:CrispCleanandFreshCitrus
Colgate
Palmolive
IrishSpring
Clear&FreshSkinBodyWashenrichedwithsalicyclicacidclaimstotreatandhelppreventbody
breakouts
Colgate
Palmolive
IrishSpring
DeepActionScrubBodyWashinfusedwithcelticrocksaltexfoliatestheskintogivecleanskin
Coty
Adidas
Hair&Body3ShowerGelcleansesandhydratesthebodyandface,conditionshair.Itisavailableinthree
variant:AfterSport,ExtraFresh,andActiveStart
Dr.Teals
Therapeutic
Solutions
Dr.Teals
MilkBathisablendofrealmilkproteinandvitaminA,D,andEforamoisturizingspalikeexperience.Itis
availableintwoforms:foamingliquidMilkBathandpowderedMilkBath
Dr.Teals
Therapeutic
Solutions
Dr.Teals
EpsomSaltFootScrubisacombinationofEpsomSaltandTeaTreeOiltoexfoliateandnourishthefeets
skin
Henkel
Dial
HelloKittyisfreshandfruitylineofpersonalcleansingproductscomprisingMoisturizingBodyWash,
AntibacterialFoamingHandWash,BarSoap,andMoisturizingHandSanitizer
Henkel
Dial
GoldAntibacterialRoundTheClockOdorProtectionDeodorizingBodyWashprovidesodorprotection
RoundTheClock
Henkel
Dial
NaturalsTangerine&GuavaMoisturizingLiquidHandSoapisinfusedwithingredientsthatare
hypoallergenicand94%naturallyderived
Henkel
Tone
FruitPeelBodyWashisacombinationofsunkissedapple,kiwi,citrus,andAlphaHydroxyAcidsthat
exfoliatetheskintowashawaydullskin
LimitedBrands
Bath&Body
Works
PinkChiffonShowerGelisafeminineblendofsparklingredpear,vanillaorchid,andwhippedchiffon
muskfragrancesenrichedwithvitaminE,aloevera,andsheabutterforacleaner,softer,andbubblier
experience.Itisavailableinatravelsizeaswell
LimitedBrands
Bath&Body
Works
PinkChiffonPocketbacSanitizingHandGelispocketsizedgermkillerenrichedwithTahitianpalmmilkto
givethehandsaconditioningfeel.Itisscentedwithsparklingredpear,vanillaorchid,andwhipped
chiffonmusk
LimitedBrands
Bath&Body
Works
CashmereGlowShowerGelisablendofgoldenpeach,shimmeringvanilla,andcashmeremusk
fragrancesenrichedwithvitaminE,aloevera,andsheabutterforacleaner,softer,andbubblier
experience
(Continued)
4A54
Table4H22:SelectNewPersonalCleansingProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
LimitedBrands
Bath&Body
Works
CashmereGlowGoldenSugarScrubcomprisessugarcrystalswhichexfoliatesandconditionswiththe
apricotandsweetalmondoils.Itsfragranceisablendofgoldenpeach,shimmeringvanilla,andcashmere
muskandcomesinaeasytousesqueezetube
LimitedBrands
Bath&Body
Works
ParisAmourCreamyBodyWashisenrichedwithTripleMoistureComplexofmilkproteins,ricebranoil,
berryextracts,andsheabutterforahydratingwash.Itsfragranceisablendoffrenchtulips,apple
blossoms,andpinkchampagne
LimitedBrands
Bath&Body
Works
ParisAmourBubbleBathisavitaminenrichedbubblebathwithafragranceblendoffrenchtulips,apple
LimitedBrands
Bath&Body
Works
ParisAmourGoldenSugarScrubcomprisessugarcrystalswhichexfoliatesandconditionswithapricotand
sweetalmondoils.Itsfragranceisablendoffrenchtulips,appleblossoms,andpinkchampagne
LimitedBrands
Bath&Body
Works
ParisAmourShowerGelisablendoffrenchtulips,appleblossoms,andpinkchampagnefragrances
enrichedwithvitaminE,aloevera,andsheabutterforacleaner,softer,andbubblierexperience.Itis
availableinatravelsizeaswell
LimitedBrands
Bath&Body
Works
ParisAmourPocketbacSanitizingHandGelispocketsizedgermkillerenrichedwithTahitianpalmmilkto
givethehandsaconditioningfeel.Itisscentedwithfrenchtulips,appleblossoms,andpinkchampagne
LimitedBrands
Bath&Body
Works
ForeverRedGoldenSugarScrubcomprisessugarcrystalswhichexfoliatesandconditionswiththeapricot
andsweetalmondoils.Itsfragranceisablendofpomegranate,redosmanthus,andvanillarum
LimitedBrands
Bath&Body
Works
ForeverRedShowerGelisablendofpomegranate,redosmanthus,andvanillarumenrichedwithvitamin
E,aloevera,andsheabutterforacleaner,softer,andbubblierexperience
Lornamead
Yardley
SkinIndulgenceLavender&RosemarySkinSoothingBath&ShowerGelisablendoflavenderoiland
rosemaryextractthatwashesawaydirtleavingtheskinsoftandsmooth
Lornamead
Yardley
SkinIndulgenceMango&CreamBodyButterCleansingBarisblendofmango,avocado,andolivebutter
whichproducesfoaminglathertogiveanenergizedexperience.
Lornamead
Yardley
SkinIndulgenceMango&LilySkinSofteningBath&ShowerGelisablendofmangobutterandcalendula
extracttogivetheskinaclean,fresh,andhydratedappearance
Lornamead
Yardley
SkinIndulgenceSeaMineralsisinfusedwithseakelpandnaturalexfoliantsandafreshbergamotand
limescenttomoisturize,exfoliate,andgivetheskinatonedlook.Itisavailableintwovariants:Scrub&
SmoothBathBarandSkinSmoothingBath&ShowerGel
Procter&
Gamble
Gillette
OdorShieldAllDayCleanBodyWashisformulatedtofightodorandwetnessinadditiontothebasic
cleansingfunction
TheClorox
Company
Gd
NaturalBodyWashwithitsfrothyfoamisavailableinfivevariants:RedRubyGroovy,PearnormalActivity,
OrangePetalooza,FloralCherrynova,andVanillaFlame
Unilever
Caress
EndlessKissSilkeningBodyWashisenrichedwithmoisturebeadsandcontainsthescentofVanillaand
Sandalwood
Unilever
Caress
PassionateSpellFineFragranceElixirBodyWashisinfusedwiththescentofpassionfruitandfieryorange
rosetoleavealingeringfragrance
Unilever
Caress
SheerTwilightFineFragranceElixirBodyWashisscentedwithblackorchidandjuniperoil
Unilever
DoveMen+Care
CleanDefenseBody&FaceWashwithMicromoistureTechnologygetsactivatedonceincontactwiththe
skintoremoveoilbuildupandmaintaintheskinsmoisturelevels
Unilever
DoveMen+Care
FreshAwakeBody&FaceWashwithMicromoistureTechnologygetsactivatedonceincontactwiththe
skinandisclinicallyproventofightskindryness
Unilever
Suave
EverlastingSunshineBodyWashisenrichedwithvitaminEandthescentofpassionflowerandvanilla
4H55
4H56
Salesbyproducttype
Overall
Body washes is the largest product type, representing onethird of the categorys sales in
2012.
Bar soaps is the secondlargest product type, accounting for 31.5% of the personal
cleansingproductscategorysalesin2012.
Liquidsoapsandbodywashesrecordthehighestgainsof4.8%and3.4%,respectively.
Salesofantibacterialhandgelsremainstagnantat$150million,flatfrom2011levels.
Table4H23:ManufacturersSalesandGrowthofPersonalCleansingProductsintheUnitedStatesby
$Million
%Oftotal
Producttype
2011
2012
2011
2012
Change,%
Bodywashesr
1,310
1,354
33.5
33.6
3.4
Barsoapsr
1,239
1,268
31.7
31.5
2.3
Bathadditives
620
638
15.9
15.8
2.9
Liquidsoapsr
588
616
15.0
15.3
4.8
Antibacterialhandgelsr
150
150
3.8
3.7
3,907
4,026
100.0
100.0
3.0
Totalr
rRestated.
Bodywashes
Since 2007, sales of the body washes segment have grown at a CAGR of 6.0% to
Table4H24:HistoricalSalesofBodyWashesProducts
Year
$Millionr
Change,%
2007
1,011
2008
1,057
4.5
2009
1,096
3.7
2010
1,225
11.8
2011
1,310
6.9
2012
1,354
3.4
rRestated.
4A56
In2012,salesofbodywashescontinuetoregisterasalesincrease.
Sales of body washes advance 3.4% to reach $1,354million in 2012, up from
Bodywashescontinuetobethekeydriverbehindthecategorysgrowthin2012.
Bodywashesaccountfor33.6%ofthetotalcategoryssalesin2012,upfrom33.5%in
2011.
The body washes segment which had stirred up sales in 2010 and 2011 due to
improved formulations, affordable prices, and adding newness to the category, slow
downin2012asthemarketbecomesfullypenetrated.Manyconsumersnowusebody
washesinconjunctionwithbarsoapsasapartoftheirdailypersonalcleansingregimen.
Marketers continue to introduce body washes enriched with natural ingredients with
moisturizingandcleansingformulations.
Marketers emphasize the use of natural and organic ingredients in their product
labelingandformulationstodrivegrowthinthematurecategory.
New and innovative products are introduced which not only focus on providing
cleansingbenefitsbutotheradditionalbenefits,suchasmoisturizingandexfoliation.
In 2012, ColgatePalmolive introduces the Irish Spring Deep Action Scrub Body Wash
enrichedwithcelticrockwhichhelpsexfoliatetheskin.
There are a variety of body washes available in the market that provide moisturizing
and exfoliating benefits with the presence of natural ingredients. A few examples of
theseincludeBurtsBeesradianceExfoliatingBodyWash,St.IvesHydratingVitaminE
Body Wash, Doves Deep Moisture Body Wash with NutriumMoisture, and Doves
TouchofHoneyDewHydratingShowerGel.
Mainstreambrandscontinuetoexpandtheirrangeofproductlinestointroducemale
centricbodywashesformulatedwithadvancedtechnology.Thisaidsthemainstream
brands to add some dynamism to the category thereby helping drive the categorys
sales.SomeofthecommonlyavailablemalecentricbrandsinthesegmentincludeAxe,
DoveMen+Care,Gillette,IrishSpring,andOldSpice.
In2012,HenkelintroducestheDialGoldAntibacterialRoundTheClockOdorProtection
DeodorizingBodyWash.
Marketers introduce multifunctional body washes which also serve the purpose of a
face wash, shampoo, and even as a bath additive. These products gain increasing
demand,especiallyfrommaleconsumers.
The trend among marketers to continue to innovate with fragrances in the body
washessegmentgainspopularityasmarketersaimtoreachouttoawidersectionof
thesocietywiththeirdiverserangeofvariants.In2012,LornameadintroducestheSkin
Indulgence Lavender & Rosemary Skin Soothing Bath & Shower Gel, Skin Indulgence
Mango&LilySkinSofteningBath&ShowerGel,andSkinIndulgenceSeaMineralsSkin
SmoothingBath&ShowerGel.
Thebodywashessegmentprovidesanopportunityformarketerstoinnovatewiththe
packaging by changing the shape and size of the bottles with creative and colorful
graphicsonthelabel,toattractattention.Marketersalsousepackagingasameansto
differentiatebetweentheirvariousproductlines.
4H57
4H58
Theliquidformatofthebodywashesgivethemanedgeoverthetraditionalbarsoaps
duetotheconvenientformatandhygienicuseofbodywashes.Barsoapsareexposed
toenvironmentalfactors,suchasair,water,dust,andgermswhilebodywashesstay
more hygienic, packaged in bottles with either a pump disposer or a nozzle for the
contentstobesqueezedout.
Marketersbenefitfromconsumerstradinguptobodywashesfrombarsoapsdueto
thebodywasheshighpricepoints.
ThesegmentattractsasubstantialamountofthemarketersTME,helpingitmaintain
consumersinterestandinducespurchasing.
Unilevercontinuestobethelargestmarketerinthebodywashessegmentin2012.
Thecompanyssalesinthebodywashessegmentgrow3.7%to$538millionin2012,
Unilevers segment share increases marginally to 39.7% in 2012, up from 39.6% of
segmentsalesin2011.
Unilever markets its Dove, Suave, Axe, Caress, St. Ives, and Lever 2000 brands in the
segment.
The marketers growth is driven by the good performance of its Dove, Suave, and
Caressbrands,andalsonewproductactivityin2012.
DoveisUnileversflagshipbrandandalsotheleadingbrandinthecategory,withsales
at$214millionin2012,up5.9%from$202millionin2011.Doverepresents39.8%of
Unileverstotalbodywashessalesin2012.
Dovesgrowthin2012isattributedtothesignificantTMEfromUnilever.Themarketer
allocatesaTMEof$63milliontothebrandin2012.
The Dove Deep Moisture Body Wash receives the maximum TME at $41.6 million in
2012. The Dove Deep Moisture Body Wash is enriched with a proprietary ingredient
NutriumMoisture, which claims to provide effective moisturization, to nourish skin
deepdown.
TheDoveVisibleCarelineofbodywashesreceivesaTMEof$13.9millionin2012.The
line has two variants: Visible Care Replenishing Crme Body Wash and Visible Care
ToningCrmeBodyWash.
Dove also benefits from its Men+Care line of products which claim to contain one
fourthmoisturizinglotion.
In 2012, Dove Men+Cares line of body and face washes is launched with two more
variants,FreshAwakeandCleanDefense.
SuaveisthesecondleadingbrandforUnilever,withsalesat$133millionin2012,up
Sales growth for the brand is aided by its natural positioning in the market with
variants available in nine different fragrances, the newest addition being Everlasting
Sunshine,a2012launch.Furthergrowthisduetoitsbrandloyaltyamongconsumers
anditseasyavailabilityacrossdifferentretailoutlets.
Sales of Axe, the thirdlargest brand for the company, decline 1.3% to $79 million in
2012 from $80million in 2011. The brand represents 5.8% of body washes sales in
2012,downfrom6.1%ofsegmentsalesin2011.
4A58
In 2012, Unilever unleashes an online advertisement campaign for its Axe brand that
urgescollegestudentstoshowerwithafriendoranattractivestrangerinanattempt
toconservewater.Themarketercoinsthetermshowerpoolingforitscampaign.The
Showerpoolingcampaignencouragessustainablelivingroutinewithatouchoffuntoit.
The marketer introduces a few videos, with some featuring brand ambassador and
actress, Nicki Reed as the narrator. The brand also distributes 7,000 waterefficient
DeltashowerheadswithH20KinteticTechnologyduringitscampustouranddonates
$100,000 to the Alliance for Water Efficiency, a nonprofit organization dedicated to
theefficientandsustainableuseofwater.
In 2012, sales of Caress advance 13.1% to reach $69 million in 2012, up from
$61millionin2011.
In 2012, Caress Body Washes receive a TME of $4.3 million. The brand allocates
$2.9milliontowardsthepromotionofthenewEndlessKissSilkeningBodyWashand
thenewPassionateSpellFineFragranceElixirBodyWash.
In 2012, Caress teams up with celebrity and style experts, June Ambrose and Lilliana
Vazquez, to start a campaign called "Caress Fabulistas. The "Caress Fabulistas help
women find and flaunt the seasons fashion trends by providing them beauty secrets
and style tips that inspire women to look good. Women also get a chance to have a
look at the behindthescenes happenings of the Caress Fabulistas on the brands
Facebook page. The brand also persuades women to upload a picture of themselves
flauntingaFabulistalooktogetachancetowinadailygiftcertificate.
SalesofProcter&Gamble,thesecondlargestmarketerinthebodywashessegment,are
Themarketersshareinthecategoryremainsstableat18.5%in2012,constant from
2011levels.
Procter& Gamble is wellpositioned in the segment with its leading brands Olay and
OldSpice.TheotherminorofferingsincludeGilletteandIvory.
Olayistheleadingbrandforthemarketerinthebodywashessegmentin2012,with
salesat$110million,up8.9%from$101millionin2011.Olayisamasstigebrandand
manyconsumerswhoarewillingtotradeupfromthebasicmassbrandsbutnotallthe
waytoluxurybrands,preferOlaysproducts.
InspiteofOlaysmoreexpensivepositioningofitsbodywashesincomparisontothe
productsofothermassbrands,thebrandperformswell.
SalesofOldSpiceadvance1.0%to$105millionin2012,upfrom$104millionin2011.
Barsoaps
Since2007,salesofthebarsoapssegmentgrowatacompoundannualgrowthrate(CAGR)
of0.4%toreach$1,268millionin2012.
4H59
4H60
Table4H25:HistoricalSalesofBarSoapsProductsin
Year
$Millionr
Change,%
2007
1,242
2008
1,258
1.3
2009
1,272
1.1
2010
1,229
(3.4)
2011
1,239
0.8
2012
1,268
2.3
rRestated.
Bar soaps continues to be the secondlargest segment in the personal cleansing products
categoryin2012.
Salesofthesegmenttotal$1,268millionin2012,up2.3%from$1,239millionin2011.
Barsoapsrepresent31.5%ofthecategorysalesin2012,marginallydownfrom31.7%
ofcategorysalesin2011;unitsalesofbarsoapsaccountsforalittlelessthanhalfof
thetotalcategorysvolumesalesin2012.
The bar soaps segment comprises the highest number of brands competing in the
category.
The segment is challenged with stiff competition from alternative products in the
category, such as body washes. More consumers are trading up to the body washes
and bath additives for a better bathing experience and to gain advantage from the
multifunctionalbenefitsoftheseproducts,whichactasashampoo,bodywashandin
somecasesformen,asafacewashtoo.
Since bar soaps are commodity products, they experience stiff competition to retain
theirsales.
Additionally, the mature segment is challenged by the limited scope for innovation.
There is not much that marketers are doing in this segment except expand their
product lines with variants in fragrances and infusing them with beneficial natural
ingredients, such as vitamins, moisturizers, antibacterial components, botanicals, and
othervalueaddedingredients.
A few of the vitaminenriched bar soaps available in the market include Dial Natural
RadianceandToneCocoaButterBathBar.
Barsoapsareperceivedbymanyconsumersasproductsusedforbasiccleansingneeds,
leading to consumers shifting to less expensive privatelabel products which offer
similarbenefits.
Moreover, marketers utilize promotional tools, such as multipack offers, to promote
thesalesoftheirbarsoaps,therebyresultinginthedeclineinrevenueperunit.
However, further decline in sales in the segment is counterbalanced by the
introductionofthenaturallypositionedproductswhichhaveagrowingreputationof
beinggentleontheskinandsuitableforbuyerswithsensitiveskin.
Also,asegmentofconsumersarestillloyaltousingbarsoapsfortheirdailypersonal
hygieneregimen.
4A60
Unilevercontinuestobetheleadingmarketerofbarsoaps,aheadofProcter&Gambleand
Henkel.
Salesadvance4.4%toreach$592millionin2012,upfrom$567millionin2011.
Inthebarsoapssegment,UnilevermarketsitsDove,Lever2000,andCaressbrands.
Unileversshareinthesegmentadvancestoaccountfor46.7%oftotalsegmentsales
in2012,up from45.8%in 2011.Theshareofthemarketerinthecategoryimproves
duetothepositiveperformanceofDove.
Doveremainstheleadingbrandinthebarsoapssegment,withsalesat$466millionin
2012,up5.9%from$440millionin2011.Thebrandsshareinthesegmentimproves
from35.5%ofthetotalsegmentssalesin2011to36.8%in2012.
Unilever continues to support Dove with a traceable media expenditures (TME) of
$21millionin2012.
Thebrandalsobenefitsfromitsloyalconsumerbasein2012.
Furthermore,Dovespromiseofusing1/4proportionasmoisturizingcreaminitsbar
soapshelpsdrivesalesforthemarketer.ThisgivesconsumersasatisfactionthatDove
barsoapsnotonlyprovidecleansingbenefitsbutalsonourishandmoisturizetheskin
simultaneously.
fourthmoisturizinglotionandareavailableasbodywashesandbodybars.
Dove claims that its body and face wash variants are infused with Micromoisture
Technology that helps prevent skin dryness by replenishing the moisture levels. The
micromoistureioninthebodyandfacewashvariantsgetactivatedontheformation
oflatherandpreventanydiscomfortduetowoundandcuts.
In2012,DoveMen+Careslineofbodyandfacewashesisextendedbytheintroduction
oftwomorevariants:FreshAwakeandCleanDefense.
Doves Beauty Bar receives a TME of $18.3 million while Dove Men+Care Bar Soaps
receiveaTMEof$2.7millionin2012.
Sales of Caress, the companys secondleading brand, remain stagnant in 2012 at
$68million,flatfrom2011levels.
In2012,CaressMoisturizingBodyBarsreceiveanegligibleTME.
In 2012, sales of Lever 2000 decline 1.7% from $59 million in 2011 to $58 million in
2012.Lever2000hasnoTMEin2012.
4H61
4H62
Withsalesat$194millionin2012,Henkelisthedistantsecondleadingmarketerinthebar
soapssegment.
SalesofHenkelbarsoapsdecline2.5%from$198millionin2011.
The marketers share in the segments sales decline from 16.0% in 2011 to 15.3% in
2012.
In 2012, Henkel divests its brand Coast to Brynwood Partners subsidiary High Ridge
Brands,therebynegativelyaffectingitsmarketshare.ThesaleofCoastcontributesto
Henkelsdecliningsalesinthissegment.
HenkelispresentinthebarsoapssegmentwithitsDialandTonebrands.
Dial is the marketers flagship brand, with sales at $184million in 2012, down 2.1%
from $188million in 2011. Dial represents 94.8% of Henkels total bar soaps sales in
2012.
SalesofToneremainflatat$10millionin2012,from2011levels.
The lack of new product activity, product innovation, and insufficient advertising
support to its bar soaps segment makes it difficult for the marketer to register sales
growthin2012.
Procter&Gambleisthethirdlargestmarketerinthebarsoapssegmentwith10.2%oftotal
barsoapssalesin2012,downfrom10.9%in2011.
Sales of Procter & Gamble bar soaps decline 4.4% from $135million in 2011 to
$129millionin2012.
Procter&Gamblecompeteswithfourbrandsinthesegment:Olay,Ivory,Safeguard,
andCamay.
Olay is Procter & Gambles flagship brand in the bar soaps segment, with its sales
declining4.8%from$63millionin2011to$60millionin2012.Thebrandssalesinthe
segmentdeclineasaresultofthelackofthebrandsabilitytointroducenewproducts
orinnovatewithformulations.SalesofIvorydecline3.8%in2012to$51million,from
$53millionin2011.
Safeguard, the thirdlargest brand for the company in the bar soaps segment, also
postsdecliningsalesat$16millionin2012,down5.9%from$17millionin2011.
SalesofCamayremainstagnantat$2millionin2012,flatfrom2011levels.
Bathadditives
Since2007,historicalsalesofthebathadditivessegmenthavegrownataCAGRof2.0%to
$638millionin2012.
4A62
Table4H26:HistoricalSalesofBathAdditivesProductsin
Year
$Million
Change,%
2007r
579
2008r
586
1.2
2009r
589
0.5
2010r
598
1.5
2011
620
3.7
2012
638
2.9
rRestated.
The personal cleansing products category covers only adult and childrens bath additives.
Infantbathadditivesarecoveredseparatelyinthebabycarecategoryofthisreport.
Salesofthesegmentadvance2.9%to$638millionin2012,upfrom$620millionin2011.
ThecategoryisdominatedbyLimitedBrands,withsalesat$262millionin2012.Sales
advance 6.5% from $246million in 2011. Limited Brands represents 41.1% of total
segmentssalesin2012,upfrom39.7%oftotalsegmentsalesin2011.
AvonandJohnson&Johnsonfollowasthesecondandthirdleadingmarketersinthe
segment, respectively. Avons sales total $78million in 2012, declining 10.3% from
$87millionin2011.Johnson&Johnsonssalestotal$39millionin2012,up2.6%from
$38millionin2011.
Bathadditivesareaneconomicalalternativetotheexpensiveservicesatprofessional
spas. As consumers shift towards more doityourself (DIY) options, bath additives
claimingtoprovideathomealternativesareahitamongthem.
Further growth in the segment is offset due to limited new product activity in the
segment.
Liquidsoaps
Since2007,salesofliquidsoapshavegrownataCAGRof2.8%to$616millionin2012.
4H63
4H64
Table4H27:HistoricalSalesofLiquidSoapsProductsin
Year
$Millionr
Change,%
2007
536
2008
544
1.5
2009
570
4.8
2010
565
(0.9)
2011
588
4.1
2012
616
4.8
rRestated.
Salesofliquidsoapsgrowsignificantlyto$616millionin2012,up4.8%from$588millionin
2011.
Liquid soaps represent 15.3% of total category sales in 2012, up from 15.0% of total
Ashiftindemandfrombarsoapstoliquidsoaps,isevidentbythehighsalesgrowthof
thesegment.
Thedesireformorehygienichandsoapleadsconsumerstooptforliquidsoapsover
barsoapsforhandwashing.
Furthermore, the liquid soap has the advantage over bar soap of not leaving soap
residueinasoapdish,sothereisnocleanuprequiredwhileusingtheliquidformat.
The promise of moisturizing benefits, exotic or seasonal scents, and attractive
packagingalsocontributetothegrowthofthissegment.
ColgatePalmoliveistheleadingmarketerofliquidsoapsin2012,withsalesat$215million.
ColgatePalmolivessegmentsharedeclinesfrom35.5%ofthetotalsegmentssalesin
2011to34.9%in2012.
ColgatePalmolive competes with its Softsoap brand, the leading brand in the liquid
soapssegment.
Sales of the brand advance 2.9% from $209million in 2011 to reach $215million in
2012.
Newproductactivityandbrandloyaltyfromconsumersplaysanimportantroleinthe
brandsgrowthin2012.
In 2012, ColgatePalmolive introduces the Softsoap Pampered Hands Coconut Lime
LiquidHandSoapandthelineofAntibacterialHandSoapwithMoisturizersavailablein
twovariants:CrispCleanandFreshCitrus.
ColgatePalmolivesupportsitsSoftsoapbrandwithaTMEof$281,600in2012,upfrom
172,700in2011.
4A64
Henkelregainsitspositionasthesecondleadingmarketerintheliquidsoapssegmentwith
salesadvancingsignificantlytodisplaceLimitedBrands.
Salesincrease13.6%to$92millionin2012,upfrom$81millionin2011.
Henkel represents 14.9% of the total segment sales in 2012, up from 13.8% of the
segmentsharein2011.
HenkelspresenceinthesegmentisthroughitsDialbrand.
SalesofDialin2012aredrivenbytheintroductionoftheNaturalsTangerine&Guava
Moisturizing Liquid Hand Soap and the Hello Kitty line of products comprising an
AntibacterialFoamingHandWash.
FurthersalesgrowthforDialisrestrictedduetolimitedadvertisingsupportin2012.
LimitedBrandsisthethirdleadingmarketerinthesegmentin2012.
Salesgrow7.7%to$84millionin2012,upfrom$78millionin2011.
LimitedBrandsaccountsfor13.6%ofsegmentsalesin2012,upfrom13.3%ofsegment
salesin2011.
LimitedBrandsloyalconsumerbaseaidsinthegrowthofBath&BodyWorksin2012.
Strategically designed marketing campaigns, attractive bright colored packaging with
trendy names, strong promotions, and availability of many variants in product lines
contributetothesuccessfulperformanceofthebrandin2012.
Sales of privatelabel products grow a mere 0.7% to $146million in 2012, up from

$145millionin2011.
Privatelabel products continue to gain distribution in 2012 across different retail
outletstosupporttheirmarginalsalesgrowth.
However, growth is offset as consumers are no longer purchasing privatelabel liquid
soapsinthemagnitudethattheywereduringtherecession.
Antibacterialhandgels
Since2007,salesoftheantibacterialhandgelssegmenthavegrownataCAGRof14.0%to
$150millionin2012.
Table4H28:HistoricalSalesofAntibacterialHandGel
ProductsintheUnitedStates,2007to2012
Year
$Millionr
2007
78
2008
86
10.3
2009
137
59.3
2010
164
19.7
2011
150
(8.5)
2012
rRestated.
150
Change,%
4H65
4H66
Sales in the antibacterial hand gels segment remain stagnant at $150 million in 2012,
constantfrom2011levels.
Antibacterial hand gels represent 3.7% of total categorys sales in 2012, down from
3.8%in2011.
Consumers benefits from the convenience of not needing water to wash their hands
whileonthego.
Thesegmentsgrowthin2009and2010hadbeendrivenbythehighlevelsofconcern
about health pandemics and epidemics. However, when such phenomena subside
periodically,itcanbeexpectedthatsaleswillstabilizeatmoresustainablelevels.
Theincidenceofswinefluhadsparkedthesignificantriseinthesalesofantibacterial
handgelsin2009and2010.
However,withnosuchthreatlurkingaround,saleshavebeennegativelyaffected.
Additionally, consumers are also challenged by the dryness caused to the skin upon
usageoftheseantibacterialhandgelswhichcontainalcoholincertainproportions.This
has led consumers to adopt the traditional means of using liquid hand soaps or bar
soapstokeeptheirhandsclean.
LimitedBrands,withitsBath&BodyWorksbrand,istheleadingmarketerinthesegmentin
2012.
Salestotal$44million,up7.3%from$41millionin2011.
LimitedBrandsrepresents29.3%ofsegmentssalesin2012,upfrom27.3%in2011.
Themarketersgrowthinthesegmentissupportedbythepositiveperformanceofthe
pocketbacs sanitizing hand gels range available in a variety of fragrances, such as
BerrySangria,FreshPickedTangerines,Bubblegum,andAlohaOrchid.
WithitsPurellbrand,GojoIndustriesisthesecondlargestmarketerinthesegment.
SalesofPurelltotal$40millionin2012,up2.6%from$39millionin2011.
Purellaccountsfor26.7%ofthesegmentssalesin2012,upfrom26.0%in2011.
In2012,GojoIndustriesreleasesacorporatestatementdeclaringthatnoneofitshand
sanitizerscontaintriclosan.
In2012,GojoIndustriesintroducesthePurellAdvancedHandSanitizerclaimingthatits
productismoreeffectivethananyotherhandsanitizerinthemarketasitistheonly
product in the market to meet the FDA germ kill requirements with a single 1.2 ml
dispense.
The brand receives a TME of $3.4 million in 2012, up from $1.1 million in 2011. The
marketerssanitizersareavailableasgels,foam,orwipes.
Privatelabelproductssalesdecline2.0%to$50millionin2012,downfrom$51millionin
2011.
Privatelabel products represent 33.3% of the segments sales in 2012, down from
34.0%in2011.Privatelabelsalescontinuetodominatethesegmentin2012.
Thesalesoftheseproductscontinuetodeclinein2012afterthehighgrowthin2009
and2010asaresultoftheH1N1virusscare.
Demand reduces in 2012, as many consumers forego the use of these products on a
regularbasis.
4A66
COMPETITION
Bycompany
Table4H29:ManufacturersSalesofPersonalCleansingProductsintheUnitedStatesbySegment
andCompany,2011and2012
$Million
Segment/company
2011
ANTIBACTERIALHANDGELS
2012
%Ofsegment
2011
2012
LimitedBrands
41
44
27.3
29.3
GojoIndustries
39
40
26.0
26.7
ViJohnLaboratories
5.3
4.0
Henkel
2.0
1.3
51
50
34.0
33.3
5.3
5.3
150
150
100.0
100.0
BARSOAPS
Unileverr
567
592
45.8
46.7
Henkelr
198
194
16.0
15.3
Procter&Gamble
135
129
10.9
10.2
ColgatePalmoliver
117
127
9.4
10.0
23
24
1.9
1.9
199
202
16.1
15.9
1,239
1,268
100.0
100.0
Unileverr
519
538
39.6
39.7
Procter&Gambler
243
251
18.5
18.5
Henkelr
139
142
10.6
10.5
ColgatePalmoliver
122
122
9.3
9.0
89
95
6.8
7.0
198
206
15.1
15.2
1,310
1,354
100.0
100.0
BATHADDITIVES
LimitedBrands
246
262
39.7
41.1
Avon
87
78
14.0
12.2
Johnson&Johnson
38
39
6.1
6.1
Privatelabel
Allotherr
Totalr
Privatelabel
Allotherr
Totalr
BODYWASHES
Privatelabel
Allotherr
Totalr
(Continued)
4H67
4H68
Table4H29:ManufacturersSalesofPersonalCleansingProductsintheUnitedStatesbySegment
andCompany,2011and2012
$Million
Segment/company
2011
2012
2011
TheCloroxCompany
35
37
5.6
5.8
Privatelabel
22
23
3.5
3.6
Allother
192
199
31.0
31.2
Total
620
638
100.0
100.0
209
215
35.5
34.9
Henkelr
81
92
13.8
14.9
LimitedBrands
78
84
13.3
13.6
145
146
24.7
23.7
75
79
12.8
12.8
588
616
100.0
100.0
1,090
1,134
27.9
28.2
ColgatePalmoliver
448
464
11.5
11.5
Henkelr
421
430
10.8
10.7
LimitedBrands
383
409
9.8
10.2
Procter&Gambler
385
385
9.9
9.6
Johnson&Johnsonr
115
115
2.9
2.9
Privatelabel
330
338
8.4
8.4
Allother
735
751
18.8
18.7
3,907
4,026
100.0
100.0
BATHADDITIVES(Continued)
LIQUIDSOAPS
ColgatePalmolive
Privatelabel
Allotherr
Totalr
COMPANYTOTALS
Unileverr
Total
rRestated.
4A68
%Ofsegment
2012
Unilevercontinuestobethelargestmarketerofpersonalcleansingproductswith28.2%of
thetotalcategoryssalesin2012.
Salesofthemarketergrow4.0%to$1,134millionin2012,from$1,090millionin2011.
Themarketerimprovesitscategorysharefrom27.9%oftotalcategorysalesin2011to
28.2%in2012.
withadistinctlead.
Bar soaps is the largest segment for the marketer representing 52.2% of Unilevers
totalcategorysalesin2012.
Bodywashes,thesecondleadingsegmentforthemarketer,accountsfor47.4%ofthe
Sales for the marketer is supported by a varied product portfolio, moderate new
productintroductions,andaconsiderableTMEof$85.2millionin2012.
Doveistheleadingbrandforthemarketerwithsalesup5.9%to$680millionin2012,
segments.
Growthofthebrandissupportedbynewproductsintroductionsin2012,especiallyin
thebodywashessegment.
TheDovemensline,DoveMen+Careconnectswellwiththemaleconsumerandaids
inthebrandsgrowthin2012.
Dovealsoenjoysaloyalcustomerbaseandgoodadvertisingsupportin2012.
DoveisallocatedaTMEof$64.5millionin2012.
ColgatePalmoliveisthedistantsecondleadingmarketerinthecategory,with11.5%ofthe
totalcategoryssalesin2012,flatfrom2011levels.
Salestotal$464millionin2012,up3.6%from$448millionin2011.
Themarketercompetesintheliquidsoaps,barsoaps,andbodywashessegments.
ThemarketerisrepresentedinthecategorywithitsSoftsoap,IrishSpring,Palmolive,
andTomsofMainebrands.
ColgatePalmolive is the leading marketer in the liquid soaps segment and fourth
largestmarketerinthebodywashesandbarsoapssegmentsduring2012.
cleansing products category in 2012. Sales of the marketer in the segment increase
Sales of the marketer in the body washes segment remain stable at $122 million in
4H69
4H70
Henkelisthethirdleadingmarketerinthecategoryin2012.
Themarketerssalesadvance2.1%in2012,from$421millionin2011to$430million
in2012.
HenkelisrepresentedinthecategorywithitsDialandTonebrands.
Henkel is the secondleading marketer in the bar soaps and liquid soaps segments,
thirdleadingmarketerinthebodywashessegment,andthefourthleadingmarketerin
theantibacterialhandgelssegment.
Bar soaps is the biggest segment for the marketer accounting for 45.1% of the
companys total sales in 2012, though sales in the segment decline 2.9% from
Thelackofnewproductintroduction,packagingchange,orformulationchangehasa
negativeimpactonthesalesofthecompanyinthebarsoapssegment.
BodywashesisthesecondleadingsegmentforHenkel,up2.2%to$142millionin2012
In 2012, the marketer introduces the Dial Gold Antibacterial Round The Clock Odor
ProtectionDeodorizingBodyWashandtheHelloKittyMoisturizingBodyWash.
Intheliquidsoapssegment,salesofHenkelamountto$92millionin2012,up13.3%
from$81millionin2011.Growthofthebrandin2012isattributedtotheintroduction
of new products, such as Natural Tangerine & Guava Moisturizing Liquid Hand Soap
andHelloKittyAntibacterialFoamingHandWash.
In2012,DialisallocatedaTMEof$2.9millionwhileTonereceivesaTMEof$55,800.
In2012,HenkelsTonebrandpartnerswithcountrysingerKerryPicklertopromotethe
newToneFruitPeelBodyWash.
BehindHenkelinthefourthleadingpositionisLimitedBrandswithsalesat$409millionin
2012,up6.8%from$383millionin2011.
MarketshareofLimitedBrandsimprovesfrom9.8%ofthecategoryssalesin2011to
10.2%in2012.
Limited Brands is the leading marketer in the bath additives segment, with sales at
LimitedBrandsfindspresenceinthebathadditivessegmentwithBath&BodyWorks
andVictoriasSecretGardenbrands.
LimitedBrandsisalsotheleadingmarketerintheantibacterialhandgelssegmentwith
salesat$44millionin2012,up7.3%from$41millionin2011.
ThemarketerispresentinthesegmentwithitsBath&BodyWorksbrand.
Limited Brands slides down to become the thirdleading marketer in the liquid soaps
segment, accounting for 20.5% of the marketers sales in 2012, marginally up from
20.4%in2011.
Duetostableeconomicconditions,thepurchasingcapacityinthehandsofconsumers
improves,resultinginmanyconsumersgoingbacktousinghighendspecialtyproducts
ofbrands,suchasBath&BodyWorks.
In2012,themarketersintroducesarangeofproductsforitsBath&BodyWorksbrand
including Pink Chiffon Pocketbac Sanitizing Hand Gel, Pink Chiffon Shower Gel,
CashmereGlowShowerGel,CashmereGlowGoldenSugarScrub,ParisAmourCreamy
Body Wash, Paris Amour Bubble Bath, Paris Amour Golden Sugar Scrub, Paris Amour
ShowerGel,PocketbacSanitizingHandGel,ForeverRedShowerGel,andForeverRed
GoldenSugarScrub.
4A70
In 2012, sales of Procter & Gamble remain stable at $385 million in 2012, flat from 2011
levels.
The marketer is present in the category with its Olay, Old Spice, Ivory, Gillette,
Safeguard,Camay,andKandoobrands.
Bodywashesisthelargestsegmentforthemarketerin2012,andisthesecondleading
marketerinthebodywashessegment,accountingfor18.5%ofthesegmentssalesin
2012. The marketers sales in the segment total $251 million in 2012, up 3.3% from
$243millionin2011.
33.5%ofthemarketerssalesin2012,downfrom35.1%ofthemarketerssalesin2011.
Thedeclineinthemarketersshareinthesegmentisduetothepoorperformanceof
Olay,Ivory,andSafeguard.
approximately 70.0% from $114.1 million in 2011, to $40.0million in 2012. The
brands.
Privatelabel
Salesofprivatelabelproductsadvance2.4%in2012.
Salestotal$338millionin2012,upfrom$330millionin2011.
Privatelabel products register high growth in segments such as body washes, bath
additives,andbarsoaps.
Thegrowthofprivatelabelproductsinspiteoftheeconomicrecoveryisanindication
ofconsumersincreasingconfidenceinthequalityoflowpricedproducts.
Liquid soaps and body washes are the top two competing segments for privatelabel
products,collectivelyrepresenting71.3%oftheirproductsalesinthecategoryin2012,
upfrom70.9%oftheirproductsalesin2011.
Overtheyears,privatelabelshavebeenabletoimprovethequalityoftheirofferings
andgainarespectableplaceinconsumersopinion.
Additionally, support from the retailers has had an influential impact on the sales
growthofprivatelabelproductsinthecategory.
Overallprivatelabelproductsrepresent8.4%ofthetotalcategoryssalesin2012,flat
from2011levels.
RETAILDISTRIBUTION
Mass merchandisers continue to dominate the category, with 43% of total retail sales in
2012,similartotheircategorysharein2011.
Massmerchandisersareabletomaintaintheirshareinthecategoryonthebasisofthe
competitivepricesthattheyoffertobuyers.This,incombination,withawidevariety
ofproductofferingsunderasingleroofmakesmassmerchandisersapopularshopping
spotforpersonalcleansingproducts.
4H71
4H72
Drugstoresarealsopopularoutletstopurchasepersonalcleansingproductsandareableto
maintaintheirshareinthecategoryin2012.
The leading drug store chains continue to offer heavy promotions and improve the
shoppingenvironmentforamorepleasantretailexperience.
Privatelabelproductsseeapushfrommassmerchandisersanddrugstores,withprivate
labelproductsbeingplacednexttobrandsoftheestablishedmarketers.
Forexample,CVShasitsownprivatelabelbodywashes,includingtheCVSRefreshing
BodyWashandCVSMoisture&RefreshingBodyWash.
Table4H30:ManufacturersSalesofPersonalCleansing
ProductsintheUnitedStatesbyRetailOutlet,2011and2012
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
43
43
Foodstores
27
27
Specialtystores
12
12
Drugstores
10
10
Directsales
Departmentstores
100
100
Total
MARKETINGACTIVITY
Unilever and Procter & Gamble continue to dominate the personal cleansing products
categoryin2012.
Print media, electronic media, sampling, and coupons are the most popular
promotionaltoolsadoptedbymarketersinthecategory.
Since majority of the personal cleansing products are mass offerings, the two most
popularchannelsofadvertisingadoptedbymarketersaremagazinesandtelevision.
Magazines represent $54.4 million or 45.2% of the total categorys TME while
television advertisements represent $50.6million or 43.2% of total category TME in
2012.
TheInternetaccountsfor$4.8millionor4.0%ofthetotalcategorysTMEin2012.
MarketersareprogressivelyutilizingtheInternetandmobilemarketingasameansto
promote their brands by sharing news about new products and latest offers. These
channels allow the marketers to build a resonance with consumers. Typically such
channels also allow additional activities, such as games, quizzes, and multimedia
applications,todrawcustomers.
4A72
UnileverovertakesProcter&Gambletobecometheleadingadvertiserinthecategory,in
2012.
TheTMEofthemarketerisat$85.2million,representing70.8%ofthetotalcategorys
TME in 2012. Unilever spends $46.9 million or 55.0% of its total TME on television
advertising.
Dove, the leading brand of the marketer, accounts for 91.1% of the marketers total
TMEin2012.WithaTMEallocationof$41.6millionor48.8%ofthecompanystotal
TME,theDoveDeepMoisturebodywashisallocatedthehighestTMEin2012.
The marketer comes out with the Dove Truth Files game where consumers are
supposedtoputtheirbarsoapandbodywashtotestforachancetowingiftcardsand
cashprizes.
Axes personal cleansing products receive a TME of $2.4 million in 2012, down
aggressivelyfrom$9.5millionin2011.Axeispromotedinmagazinesandthecompany
allocates$2.0millionor83.3%ofthebrandstotalTMEtomagazineadvertising.
In2012,UnileveradvertisesitsAxebrandinacontroversialonlinecampaignthaturges
college students to conserve water by showering with a friend or an attractive
stranger,aconceptthatthemarketertermsshowerpooling.
In 2012, Axe teams up with supermodel Kate Upton and profootball player Jason
PierrePaul to promote its newly launched Axe Sport Blast 2in1 shower gel and
shampoo.KateUptonandJasonPierrePaulhosttheAxeSportBlastCombineHouse,a
competitivepartyspacewherethetwosquareoffinaseriesofchallenges.
In addition to television and magazine advertisements, social media also plays an
important role in promoting the marketers offers, discount coupons, or any new
productsintroductions.
Procter & Gamble slides to become the secondleading advertiser in the category with a
TMEallocationof$11.6millionin2012.
The marketers TME declines 70.0% from $114.1 million in 2011, to $40.0million in
2012.
The company apportions $10.6 million or 91.4% of the marketers total TME on
In2012,Procter&GambleintroducestheMyCityisMyGymcampaigntopromote
its Gillette brand. The campaign encourages men to take their exercise routine
outdoorsandcleansethemselveswithGillettesOdorShieldBodyWash.Themarketer
claimsthatthisbodywasheliminatesodorinsteadofmaskingit.Gillettepartnerswith
three professional athleteshockey player Patrick Sharp, Dhani Jones, a former
footballstar,andJerryRice,afootballlegendtopromoteitsproducts.
Olayswebsitepromotesitspersonalcleansingproductsbyinformingconsumersabout
the various offers and providing details on ways to attain the companys products at
lowerprices.Olayalsoprovidesfreeshippingonpurchasesabove$25.00.
4H73
4H74
TME in the personal cleansing products category declines drastically to $154.0 million in
2012,down45.3%from$281.4millionin2011.
Magazines surpass television to become the most preferred medium of advertising
usedinthepersonalcleansingproductscategory.Magazineadvertisementrepresents
$54.4millionor45.2%ofthecategorystotaladvertisingdollarsin2012.
Television advertising slips to the second position with a TME allocation of
$50.8millionor43.2%oftotalcategorysTMEin2012.
Procter & Gamble cuts down its advertising expenditure in 2012 to $11.6 million. Its
TMErepresents9.7%ofthetotalcategory.
Beiersdorf emerges as the thirdleading advertiser in 2012, replacing Johnson &
Johnson.BeiersdorfpromotesitsNiveabrandwithaTMEof$5.9millionin2012.The
companyallocates$5.2milliontoadvertiseitsNiveaTouchOfbodywash.
In 2012, Henkel spends $3.5 million on TME to promote its brands that compete in the
personalcleansingproductscategory.Themarketerspends$2.6millionor74.3%ofitstotal
TMEexpenditureinthecategorytopromotetheDialTripleMoistureBodyWash.
In2012,HenkelpartnerswithSpartanRaceseriestopromoteitsDialforMenbrand.
SpartanRacehostsobstaclecourseracesthroughmudandtrailstotestonesresilience,
strength,stamina,anddecisionmakingskills.ThecompanysuppliesDialforMenbody
washattheshowerstationstowashawaythetoilsofthecourse.
Henkel for its Tone brand teams up with country singer Kellie Pickler to promote its
TheToneTurnitUp!Seriesin2012.ConsumersareinvitedtokeepupwithPicklervia
Facebook through personal blog posts, and a live Facebook chat. Fans also have the
chancetoparticipateincontestgiveaways,includingagrandprizeofanallexpenses
paidtriptoNashvilletomeetthecountrysinger.
DetailsonTMEsbybrandareincludedintheAdvertisingsectionofthisreport.
OUTLOOK
SalesofthepersonalcleansingproductscategoryareforecasttoadvanceataCAGRof1.9%
Thecategoryisinamaturephaseandlimitedinnovationfrommarketerswilldampen
thegrowthofthecategoryduringtheforecastperiod.
There is fierce competition within the category, and individual companies will
experiencegrowthbytakingsharefromothermarketersinthecategory.
The slow growth of the category will, however, be supported by the introduction of
newproductsacrossthevarioussegments.Marketerscanlooktoinnovatewiththeir
productsbyofferingbenefitsinadditiontotheregularcleansing.Addedbenefitstothe
personalcleansingproductscouldbeintheformofmoisturizing,exfoliating,antiaging,
odorprotection,andadditionofvitamins.
4A74
Other factors contributing to the growth of the category during the forecast period
involvepackaginganddesignchanges,changeinformulationsofexistingproductlines,
andthemarketerseffortstoincreasinglyintroducenaturallyformulatedproducts.
Few marketers experience a gradual phaseout of their brands from the bar soaps
segmentduetothelackofgrowthoffered.Thesemarketersareexpectedtoshifttheir
focus on the growing body washes segment, which offers a huge potential for
innovationandgrowthduringthenextfiveyears.
Marketers will continue to make efforts to differentiate their products from others
availableinthemarketsoastoprovideexclusivity.
Body washes providing multipurpose functions, such as shampoos and face washes,
willcontinuetogainpopularityamongmenduringthenextfiveyears.
Thebodywashessegmentisexpectedtomaintainitspositionasthelargestsegmentin
thepersonalcleansingproductsduringthecourseofthenextfiveyears.
Malecentric brands are expected to gain share in the personal cleansing products
category as the male grooming market booms. Marketers are also likely to render
increased marketing efforts targeted towards the malespecific brandsin the form of
traditionalmarketingmedia,suchastelevisionandmagazineadvertisements,thereby
gainingsomeloyaltyfromthem.
Liquidsoapsareexpectedtocontinuetogrowatamoderaterateasconsumersprefer
the use of liquid soaps over bar soaps to wash hands. Additionally, many consumers
shift from the use of antibacterial hand gels towards liquid soaps with the option of
usingantibacterialhandgelsonlywhenonthegointheabsenceofwater.
Sales in the antibacterial hand gels segment are expected to stabilize in the forecast
period
as there is still a certain section of consumers who are concerned about their health
and hygiene habits and will continue to use hand gels for protection. Additionally,
marketers are expected to make efforts to educate consumers about maintaining
personalhygieneandtheimportanceofusingantibacterialhandgels.
Thereisalwaysthenecessityforcleaninghandsonthegointheabsenceofwater,the
core function of antibacterial hand gels. Marketers are open to innovating in the
segment the form of new formulations. Formulations could be designed in a manner
suchthattheycauselessdrynesstotheskinuponusage.
Privatelabelwillcontinuetoperformduringtheforecastperiodduetotheirimproved
qualityofofferings,availabilityatalowprice,andsubstantialbackingfromretailers.
Marketersareexpectedtoinnovatewiththeirmarketingcampaignstolureconsumers
into purchasing products in this mature category and also attain the loyalty of
consumers towards their brands. Marketers in the category are expected to use the
popularsocialmedianetworkstomarkettheirproducts.
SalesofthecategoryareexpectedtoadvanceataCAGRof1.9%to$4,424millionin2017,
4H75
4H76
Table4H31:ForecastManufacturersSalesofPersonalCleansingProductsinthe
UnitedStatesbySegment,2012to2017
$Million
Segment
2012
2017
CAGR,%
150
160
1.3
Bodywashes
1,354
1,589
3.3
Liquidsoaps
616
665
1.5
Bathadditives
638
660
0.7
Barsoaps
1,268
1,350
1.3
Total
4,026
4,424
1.9
UnitsalesinthecategorywillgrowataCAGRof1.6%to1,797.0millionpackagesin2017,
upfrom1,663millionpackagesin2012.
Table4H32:ForecastUnitSalesofPersonalCleansingProductsintheUnited
StatesbySegment,2012to2017
Millionpackages
Segment
2012
2017
CAGR,%
67
70
0.9
Bodywashes
449
520
3.0
Liquidsoaps
215
228
1.2
Bathadditives
126
129
0.5
Barsoaps
806
850
1.1
1,663
1,797
1.6
Total
4A76
SHAVINGPRODUCTS
CATEGORYPERFORMANCE
Manufacturerssales
Manufacturers sales of the shaving products category advance 3.0% during 2012 to
Sales of the shaving products category have grown at a compound annual growth rate
(CAGR)of1.6%from$345millionin2007to$373millionin2012.
Table4H33:HistoricalSalesofShavingProducts
Year
$Million
Change,%
2007
345
2008
336
(2.6)
2009
341
1.5
2010
348
2.1
2011
362
4.0
2012
373
3.0
Unitsales
Unit sales of shaving products grow 2.7% to 238.3million packages in 2012, up from
Retailsales
Retailsalesgrow3.1%toarounded$538millionin2012,upfromarounded$522millionin
2011.
4H78
ShavingProducts
Table4H34:ManufacturersSalesofShavingProductsintheUnitedStatesbyProductTypeandBrand,2011and2012
Producttype/brand
Company
$Million
2011
SHAVINGCREAMS
2012
%Ofsegment
2011
%Oftotal
2011
2012
EnergizerHoldings
83
85
23.5
23.4
22.9
22.8
Gillette
Procter&Gamble
82
84
23.2
23.1
22.7
22.5
Edge
EnergizerHoldings
75
77
21.2
21.2
20.7
20.6
Barbasol
PerioProducts
18
18
5.1
4.9
5.0
4.8
NiveaForMen
Beiersdorf
14
14
4.0
3.8
3.9
3.8
Aveeno
Johnson&Johnson
11
10
3.1
2.7
3.0
2.7
TheArtofShavingr
Procter&Gamble
10
2.3
2.7
2.2
2.7
EOS
EOSProducts
1.7
2.2
1.7
2.1
NeutrogenaMen
Johnson&Johnson
1.7
1.6
1.7
1.6
AnthonyLogisticsForMen
AnthonyBrands
1.7
1.4
1.7
1.3
Schick
EnergizerHoldings
1.1
1.1
1.1
1.1
MaryKay
MaryKay
1.1
1.1
1.1
1.1
JackBlackr
JackBlack
0.8
0.8
0.8
0.8
Noxzema
Unilever
0.8
0.8
0.8
0.8
CliniqueSuppliesforMen
EsteLauder
0.6
0.5
0.6
0.5
Zirh
TPRHoldings
0.6
0.5
0.6
0.5
OldSpice
Procter&Gamble
0.3
0.3
0.3
0.3
KingofShaves
KMIInternational
0.3
0.3
0.3
0.3
LabSeriesSkincareForMen
EsteLauder
0.3
0.3
0.3
0.3
ClarinsMen
Clarins
0.3
0.3
0.3
0.3
Origins
EsteLauder
0.3
0.3
0.3
0.3
Privatelabelr
11
12
3.1
3.3
3.0
3.2
Allother
10
12
2.8
3.3
2.8
3.2
353
364
100.0
100.0
97.5
97.6
Total
PRESHAVES
LectricShave
Combe
Allother
66.7
66.7
1.7
1.6
22.2
22.2
0.6
0.5
11.1
11.1
0.3
0.3
Total
100.0
100.0
2.5
2.4
TOTAL
362
373
100.0
100.0
rRestated.
4A78
Skintimate
Privatelabel
2012
ShavingProducts
CATEGORYDEVELOPMENT
Markettrends
Theshavingproductscategory,categorizedbyestablishedmassmarketers,isinamature
phase.
In2012,thecategoryshowsmoderategrowthof3.0%.
With the average growth of large established marketers, such as Energizer Holdings,
Procter&Gamble,Johnson&Johnson,andBeiersdorf,thecategorywitnesseslimited
new product activity and innovation from these marketers thereby restricting the
categorysgrowth.
The category continues to be dominated by mass brands, with a limited presence of
prestigebrands.
Theshavingproductscategorycontinuestobedominatedbymassmarketers.
Many consumers choose mass shaving products to get the desired results instead of
indulginginmoreexpensiveprestigeproducts.
Although several prestige brands, such as Jack Black, Clinique, Zirh, Origins, and Lab
SeriesSkincareForMencompeteinthecategory,theyfinditchallengingtocompete
withthemassbrands.
Prestige marketers use elegant packaging and provide customer service assistance.
However, the majority of male consumers have not taken to this and continue to
choose costeffective mass shaving products over the expensive shaving products of
prestigemarketers.
Diversificationofproductsinfluencesthecategorysgrowthin2012.
Shavinggelsandcreamscontinuetogainmarketshareinthecategory.
Marketers, such as Energizer Holdings and Procter & Gamble introduce shaving gels
and creams enriched with moisturizing benefits that provide prevention from rashes
andirritation.Growthoftheaerosolbasedfoamsislowonaccountoftheseproducts
offering limited benefits to the skin and the perceived negative effect on the
environment.
Marketersdiversifytheirrangeofshavinggelsandcreamsbyofferingvariantsenriched
withnaturalingredients,suchasaloe,antioxidants,andfragrances.
In2012,EOSProductsintroducestheEOS24hourMoisturizingShaveCreamenriched
with natural conditioning oils, shea butter, antioxidants, and vitamins C and E; and
EsteLauderintroducestheOriginsBladeRunnerenrichedwithkukuinutoil,soyabean
oil,andotherplantprotectors.
Also, shaving products infused with natural ingredients allow marketers to position
themathigherprices.
Marketers are also increasingly introducing shaving products targeted towards men
with sensitive skin, which is prone to irritations and allergy. Gillettes shave gels for
men with sensitive and irritationprone skin include Gillette Fusion ProGlide Irritation
DefenseShaveGel,GilletteFusionHydraGelPureandSensitiveShaveGel,andGilllette
FusionProGlideSensitiveShaveGel.
4H79
4H80
ShavingProducts
Changingfashiontrendsanddemographylimitsfurthergrowthinthecategory.
Thecurrentfashiontrendofsportinganunshavenlookwithmenkeepingstubbleshas
anunfavorableeffectonthecategorysgrowthin2012.
Also,manyworkplacesallowmentokeepanunshavenlookasapartoftheirformal
appearance, and the high unemployment rate coupled with higher levels of
telecommutingfurtherreducestheneedtoshaveasoften.
Moreover,thegrowingagingpopulationintheUnitedStateshasanundesirableeffect
onthecategorysgrowthasretiredmendonotneedtoshaveasoftenasyoungmen.
Womencentricproductscontinuetogainfootholdinthecategory.
Duetolackofinnovationinthemalesegment,themalecentricmarketersattemptto
developnewlineofshavingproductsforwomenorexpandtheirexistinglineoffemale
shavingproducts.
In 2012, sales for Skintimate, a femalecentric and the leading brand in the shaving
productscategorygrow2.4%.
Gillette, a previously malecentric brand, offers the Gillette Venus Satin Care line of
productscomprisingshavinggelsforwomen.TheSatinCarelinecomprisesshavinggels
availableindifferentfragrances,suchasAlluringAvocado,LavenderKiss,FloralPassion,
andPassionFruitandalsofordifferenttypesofskin.
However,productinnovationsandtechnologicaladvancementsintheformofsprays,
andinshowerdepilatorieshaveanadverseeffectonthesalesoftheshavingproducts
inthefemalesegment,therebymoderatingthegrowthofthissegment.
Additionally shaving is a more tedious process involving the purchase of razors and
shavinggelsorcreams,whilepurchaseofdepilatoriesrequiresthepurchaseofasingle
packcontainingallthenecessaryitemsforeasyhairremoval.
Thereisarisingtrendforthelaunchofspalikebarbershops/salons.
The Art of Shaving through its barber shops/salons offers traditional barber services
andaromatherapyskinservices,withshavingspecialistsalsoprovidingmaleconsumers
guidanceongroomingandproductselection.
Whiletheproductsusedwithinthesalonsbytheprofessionalsarenottrackedinthis
study,theproductssoldfortakehomeuseareincluded.Oftenafteragoodexperience
inthebarbershopsalon,menbuysomeproductstouseathome.
Anotherexample,TheBoardroomSalonforMenoffersamyriadofgroomingservices
includingshaving.ThesalonisknowntouseTheArtofShavingproducts.
4A80
ShavingProducts
Notablenewproducts
Table4H35:SelectNewShavingProductsIntroducedintheUnitedStatesin2012
Company
Brand
Description
EnergizerHoldings
Schick
HydroSkinProtectShaveGelenrichedwithingredientsincludingvitaminEandaloe,
andhelpsprotecttheskin
EOSProducts
EOS
MoisturizingShaveCreamenrichedwithnaturalconditioningoils,sheabutter,
antioxidants,andvitaminsCandE
EsteLauder
Origins
BladeRunnerenrichedwithkukuinutoil,soyabeanoil,andotherplantprotectors.Its
fragranceisablendofcoriander,Australianeucalyptus,Frenchpeppermint,andother
naturalrevivers
Procter&Gamble
Gillette
FusionProGlideClearShaveGelisanonfoamingshavegelwithamasculinefragrance
Salesbyproducttype
Shavingcreamsandgels
Table4H36:ManufacturersSalesofShavingProductsin
Year
$Million
Change,%
2007
332
2008
323
(2.7)
2009
330
2.2
2010
339
2.7
2011
353
4.1
2012
364
3.1
Theshavingcreamsandgelscontinuetobethekeydriverbehindthecategorysgrowthin
2012.
Marketers are increasingly introducing creams and gels formulated with benefits, such as
moisturizing,irritationreduction,suitableforsensitiveskin,andeffectiveskincare.
Althoughsalesofshavingfoamsremainstagnantat$76millionin2012,theircategory
sharedeclinesfrom21.5%in2011to20.9%in2012.
4H81
4H82
ShavingProducts
Table4H37:ManufacturersSalesofShavingProductsintheUnitedStatesbyProductType,2011
and2012
$Million
Producttype
2011
2012
Creamsandgels
273
284
76
4
Foams
Allothera
%Oftotal
2011
2012
Changeinvalue,%
77.3
78.0
4.0
76
21.5
20.9
1.1
1.1
Total
353
364
100
aIncludesmugsoap,tubes,andoils,amongothers.
100
3.1
Preshaves
Thesalesofthepreshavessegmentremainsstagnantin2012at$9millionfrom2011levels.
Combes Lectric Shave is the largest brand in the category with sales constant at
$6millionin2012from2011levels.Themarketerrepresents66.7%ofthesalesinthe
preshavesegmentin2012.
The market has very limited offerings in this segment. Moreover, companies neither
introducenew,attractiveandinnovativeproductsnortakeinitiativestopromotethe
segmentamongthemaleconsumers.
Thereareveryfewbrands,suchasTheArtofShavingandLectricShavewhocompete
inthiscategory.
Table4H38:ManufacturersSalesofPreshaveProductsin
Year
$Million
Change,%
2007
13
2008
13
2009
11
(15.4)
2010
(18.2)
2011
2012
4A82
ShavingProducts
Salesbysegment
Shavingcreamsandgelscontinuetodominatewith78%oftheproducttypesalesin2012.
The share of womens shaving products advances to reach 30.2% in 2012, up from
29.7%in2011.
Growth in the womens product type segment is driven by the introduction of EOS
ProductsMoisturizingShaveCream.
EOSisgrowingfastwitha33.3%growthin2012from$6millionin2011to$8millionin
2012.
Also, womens shaving products constitute added advantages including moisturizing,
vitamins,andaloe,whichmakethemanattractivechoiceforfemalebuyers.
Furthergrowthinthewomensshavingproductssegmentisoffsetbythepresenceof
depilatories in the market and also due to some women choosing mens shaving
productsoverwomens.
However,theshareofmensshavinggelsandcreamsdeclinesto69.8%in2012from
70.3%in2011duetothegoodperformaceofwomensshavinggelsandcreams.
Table4H39:ManufacturersSalesofShavingProductsintheUnitedStatesbySegment,2011
and2012
$Million
%Oftotal
Segment
2011
2012
2011
2012
Changeinvalue,%
Mens
248
254
70.3
69.8
2.4
Womens
105
110
29.7
30.2
4.8
Total
353
364
100.0
100.0
3.1
4H83
4H84
ShavingProducts
COMPETITION
Bycompany
Table4H40:ManufacturersSalesofShavingProductsintheUnitedStatesbyCompany,2011and2012
$Million
Company
2011
2012
EnergizerHoldings
162
166
Procter&Gambler
91
PerioProducts
%Oftotal
2011
2012
Change,%
44.8
44.5
2.5
95
25.1
25.5
4.4
18
18
5.0
4.8
Johnson&Johnson
17
16
4.7
4.3
Beiersdorf
14
14
3.9
3.8
EOSProducts
1.7
2.1
33.3
Combe
1.7
1.6
AnthonyBrands
1.7
1.3
EsteLauder
1.1
1.1
Privatelabel
13
14
3.6
3.8
7.7
Allotherr
25
27
6.9
7.2
8.0
Total
rRestated.
362
373
100.0
100.0
3.0
(5.9)
(16.7)
EnergizerHoldingscontinuestobe theleadingmarketerintheshavingproductscategory
Salesadvance2.5%from$162millionin2011.
Themarketerscategorysharedeclinesfrom44.8%in2011to44.5%in2012.
EnergizerHoldingshasapresenceinthecategorywithitsSkintimate,Edge,andSchick
brands.
Skintimate, the flagship brand of Energizer Holdings, leads the category with sales at
$85millionin2012,up2.4%from$83millionin2011.Thebrandrepresents22.8%of
Skintimate, a femalecentric brand, continues to grow as the future prospect for
shaving products for women brightens. The brand is also the largest female shaving
brandinthecategory.
In 2012, Skintimates Lotionized Shave Crme undergoes a packaging makeover. The
product comes in a new colorful packaging that gives it a feminine touch. The
moisturizingshavingcreamisenrichedwitholivebutter,soy,vitaminE,andaloevera.
Skintimates Lotionized Shave Crme is available in three variants: Sensitive Skin
Formula,DrySkinFormula,andBabySoftFormula.
4A84
ShavingProducts
Edgeisthesecondleadingbrandforthemarketerin2012withsalesat$77million,up
2.7% from $75million in 2011. Although the sales for Edge increase in 2012 but its
marketsharedeclinesslightlyfrom20.7%in2011to20.6%in2012.
In2012,EdgeutilizesitsFacebook pagetopromoteitsproductsthrougha varietyof
sweepstakesincludingtheEdgeEndowmentSweepswherebyparticipantsgetachance
to win $10,000 daily and over 250 weekly cash prizes and the Team Edge
SweepstakeswhichrequiresparticipantstovotefortheUFCrisingstarinordertowina
tripfortwotoLasVegastoseealiveUFCevent.
Additionally in 2012, the marketer introduces special edition Team Edge cans
containingtheUFCfightersfacesetchedonthepackaging.
Schicks sales remain stagnant at $4million in 2012 from 2011 sales. In spite of the
SchickHydroSkinProtectShaveGellaunch,thesalesofthecompanyremainstagnant
in2012.
Procter&Gamblecontinuestobethesecondleadingmarketerinthecategoryin2012.
Manufacturerssalesreach$95millionin2012,up4.4%from$91millionin2011.
Themarketshareforthecompanyincreasesto25.5%in2012,upfrom25.1%in2011
duetotherapidlyexpandingTheArtofShavingbrand.
Furthergrowthforthebrandisoffsetbyncreasingcompetitionfromotherbrandsin
Themarketerssecondleadingbrand,TheArtofShavingwitnessesagrowthof25.0%
to$10millionin2012,upfrom$8millionin2011.
SinceProcter&GamblesacquisitionofTheArtofShavingbrandin2009,thebrandhas
been the fastestgrowing brand for Procter & Gamble in the beauty and grooming
division. The brands retail presence, which was once confined to department stores,
witnesses growing retail expansion to standalone stores, mass merchandisers, and
selectsalonsafteritsacquisitionbyProcter&Gamble.
Also, the number of The Art of Shaving stores has more than doubled since its
acquisitionwithamajorityofstoreshavingabarbershopinsidethemtopampermen
withatraditionalshavingexperience.Thebrandhasitsownretailstoresinabout80
locationsacrosstheUnitedStates.
SalesofOldSpice,themarketersthirdbrandinthecategory,remainat$1millionin
2012,constantfrom2011levels.
4H85
4H86
ShavingProducts
PerioProductscontinuestobethethirdleadingmarketerinthecategoryin2012.
Salesremainat$18millionin2012,flatfrom2011.
The categorys share of Perio Products declines from 5.0% of total category sales in
2011to4.8%oftotalcategorysalesin2012.
The marketers TME allocation of $2.6million to its Barbasol brand helps retain the
salesofthebranddespitenonewproductintroductionsin2012.
In2012,Barbasolsignsafiveyearagreementtobecometheofficialjerseypartnerof
ColumbusCrewOhiosMajorLeagueSoccerClub.Moreover,thebrandalsosupports
the Crew Soccer Foundation: an organization that uses soccer as a tool to provide
education,fielddevelopment,andahealthylifestyletotheyouth.
Also in 2012, the marketer teams up with professional snowboarder Louie Vito to
promotetheBarbasolArcticChillwithMentholShavingCream.
Johnson&Johnsonretainsitspositionasthefourthlargestplayerintheshavingproducts
categoryin2012.
The companys sales decline 5.9% to $16million in 2012, down from $17million in
2011.
ThemarketerisrepresentedinthecategorywithitsAveenoandNeutrogenabrands.
SalesofAveeno,Johnson&Johnsonsleadingbrandintheshavingproductscategory,
decline9.1%to$10millionin2012,downfrom$11millionin2011.
Neutrogena Men is the other brand of the marketer with which it competes in the
category.In2012,thebrandssalesremainconstantat$6millionfrom2011levels.
EOS Products posts a growth of 33.3% to reach $8million in 2012, up from $6million in
2011.
Introduction of the EOS 24hour Moisturizing Shave Cream in 2012 aids in the
marketers growth. The product is enriched with conditioning oils, shea butter,
antioxidants,vitaminCandE.Thecompanyclaimsitsproductprovidesacloseshave,
preventsrazorbumps,andprovidesnourishmentfor24hours.
Thecompanybenefitsfromitsexistenceintheemergingwomensshavingsegment.
FurthergrowthofthebrandisduetotheTMEsupportof$3.5millionin2012.Majority
oftheadvertisingexpendituresin2012isonmagazineadvertisements.
The marketer promotes its shaving products at consumer events and trade shows by
providingconsumerswithproductsamples.
Privatelabel products steadily gain share in the market accounting for 3.8% of the total
categoryssalesin2012,upfrom3.6%in2011.
Growth of privatelabel products is supported by the increasing confidence among
consumersaboutthequalityofproducts.
Moreover,privatelabelproductsbenefitfromthepriceadvantagetheyhaveoverthe
nationalbrands,negativelyaffectingtheirsales.
4A86
ShavingProducts
RETAILDISTRIBUTION
Massmerchandiserscontinuetodominatethecategory,with41.0%oftotalretailsalesin
2012,similartotheircategorysharein2011.
Due to the widespread usage of shaving creams, mass merchandisers are convenient
andappropriateoutletstofindtheseproducts.
Foodstoresareabletomaintaintheircategorysharein2012at26.0%.
Theshareofdepartmentstoresremainsconstantat4.0%.
Thecategoryshareofdirectsalesremainsat2.0%.Thereisincreasingpopularityofe
commercesalesespeciallyamongmen,whilepersontopersonsalesdrag,keepingthe
averagelow."
Table4H41:ManufacturersSalesofShavingProductsinthe
%Oftotal
Retailoutlet
2011
2012
Massmerchandisers
41
41
Foodstores
26
26
Drugstores
25
25
Departmentstores
Directsales
Specialtystores
100
100
Total
MARKETINGACTIVITY
Gillettepartnerswith25ambassadorsworldwideforitsGetStartedcampaign.
Thecampaignhelpsitsambassadorstogivebacktotheirrespectiveorganizationsand
communities,whichgroomedthemtotheircurrentpositioninlife.
GilletteandRyanLochte,worldchampionswimmer,donate$25,000toDaytonaBeach
SpeedSwimmingtheswimmingclubthathelpedgiveLochteastarttohisswimming
career.
Gillette also partners with sport personalities, such as Tyson Gay (USA, track), Roger
Federer(Switzerland,tennis),andSirChrisHoy(GreatBritain,cycling).
4H87
4H88
ShavingProducts
Edge Shave Gel promotes its products by advocating consumers to enter the Edge
Endowment sweepstakes for a chance to win $10,000 by letting the brand know how
$10,000wouldhelpgettheiredge.
TheArtofShavingbrandteamsupwithMovember,aglobalmenshealthcharity,tofight
cancerthataffectsmen.
The participants raise awareness and funds for mens health, especially prostate and
testicularcancer.
The Art of Shaving encourages people to participate in Movember's 6th annual U.S.
fundraisingevent.
Thebrandurgesmembersoftheir"brotherhoodofshaving"toparticipateintheevent
byassuringtomatchtheteamdonationsupto$25,000.
In 2012, The Art of Shaving invites all registered MoBros to a complimentary
MovemberHotTowelShaveavailableatthebrand'sBarberSpalocations.
Afewofthepopularpromotionaltoolsutilizedbymarketersincludepricediscounts,FSIs,
coupons,instorepromotions,andconsumerevents.
Marketersusetheproductspackagingtosharepromotionrelatedinformation.
Marketersorganizeproductsamplingandconsumereventstointroducenewproducts
andinduceconsumerstobuytheproduct.
EnergizerHoldingsoffersprintablecouponsfortheSkintimatebrandwhichatdifferent
time frames allows the customers to avail $1.00, $1.50, and $2.00 off on every
purchase.
In 2012, TME for the shaving products category total $30.6million, down 15.0% from
$36.0millionin2011.
In 2012, marketers spend 42.2% of the total TME or $12.9 million on magazine
advertisements and 35.3% of the total TME, or $10.8million on television
advertisements,.
Market leader, Energizer Holdings TME for 2012 is $12.5million, down 27.3% from
$17.2millionin2011.
Themarketerspends$8.1millionontelevisionadvertisementsin2012.
Print advertisements account for $2.3million of the companys TME in support of its
brands.
Edgealonegarners$9.5millionor76%ofthemarketersTMEin2012.
Procter & Gamble spends $4.4 million as TME to promote its brands competing in the
shavingproductscategoryin2012,up10.0%from$4millionin2011.
In2012,PerioProductsovertakesProcter&Gamblesmediaexpenditure.
ThecompanyhasaTMEof$9.0millionin2012,down20.4%from$11.3millionin2011.
ThemarketershighestTMEisforitsPureSilkbrandwithaTMEof$6.4millionin2012.
In2012,themarketerspends$2.6millionasTMEforitsBarbasolbrand.
4A88
ShavingProducts
report.
OUTLOOK
Theshavingproductscategoryisexpectedtoshowamoderategrowthof1.5%duringthe
Growth during the forecast period is most likely the direct result of changing habits
amongmentowardstheirpersonalgroomingastheybecomemoreconsciousoftheir
appearance.
Newandinnovativeproductlaunches,changingformulations,andimprovedpackaging
isexpectedtogarnerfurthergrowthinthecategorythrough2017.
Marketers will continue to undertake efforts to differentiate their brands from the
others available in the market by giving their brands a premium positioning in the
market,eventhosesoldinmasschannels.
Prestigemarketersareexpectedtogainmarketshareinthefuture.
Marketersareexpectedtocontinuetodiversifytheirproductofferings.
Innovationwillplayamajorroleinthecategorysgrowthduringthenextfiveyears.
Shavingproductsenrichedwithskincarebenefitsareexpectedtogainpopularitydue
to their dual function of providing a smooth shaving experience with moisturizing
benefits.
Theseshavingproductsinfusedwithmoisturizingbenefitsareexpectedtobeenriched
with commonly used natural ingredients, such as aloe, vitamin A and E, shea butter,
cocoabutter,milk,andhoney.
With the rapidly developing male grooming market, a large proportion of the welltodo
malepopulationisexpectedtotradeuptousingprestigeshavingproductsasapartoftheir
dailyroutine.
Althoughtheshavingproductscategoryisdominatedbymassmarketers,theprestige
marketersarelikelytogainshareduringtheforecastperiodending2017.
Prestigemarketersareexpectedtointroduceinnovativeandmultifunctionalproducts
for male consumers, giving them skin care benefits in addition to the basic shaving
advantage.
The female segment in the category shall continue to gain marketers attention and post
growthinthenextfiveyears.
Malecentricshavingbrandsareexpectedtointroduceorexpandtheiralreadyexisiting
femaleproductlineswithinthecategoryinanattempttoappealtoabroadersection
ofthesociety.
Availability of variants in different fragrances for women will be a key driver for the
growthofthefemalecentricshavingproducts.
4H89
4H90
ShavingProducts
Furthergrowthinthesegmentwillbeoffsetbyalternativetreatmentsandservices,suchas
depilatories,salonwaxes,lasers,andelectrolysis,andthegrowingathomebeautydevices
market.
SalesofthecategoryareexpectedtoadvanceataCAGRof1.5%to$402millionin2017,up
UnitsalesinthecategorywillgrowataCAGRof1.2%to253millionpackagesin2017,up
4A90
MinorCompanies
SectionSix
MinorCompanies
SectionSixof
ContinuingService
CARRIEMELLAGE
KlineMarketResearch
+19734353412
otherpersonsororganizationsbeforeApril1,2016.
SPECIALNOTICE


company.

employees of subscribing companies and their subsidiaries, as defined above, until April 1,
2016.Similarly,allsectionsofthesurveyaresorestrictedforthreeyearsfromtheirdatesof
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Kline&Company,Inc.
Servingthe
Strategicanalyses
4A4
TABLEOFCONTENTS
Page
MINORCOMPANIES.............................................................................................................61
Abercrombie&Fitch......................................................................................................65
AlsGroupe....................................................................................................................66
AllianceBoots.................................................................................................................66
AmorepacificCorporation..............................................................................................68
AnthonyBrands..............................................................................................................69
Arbonne........................................................................................................................610
AstralBrands................................................................................................................611
AtlanticCoastMediaGroup.........................................................................................612
AubreyOrganics...........................................................................................................612
BarcforMen.................................................................................................................613
Beauticontrol(TupperwareBrands).............................................................................614
Beekman1802..............................................................................................................615
Blistex...........................................................................................................................615
BlowPro.......................................................................................................................616
BlueQ...........................................................................................................................617
BonneBell.....................................................................................................................617
BradBiophotonic..........................................................................................................618
ByTerry.........................................................................................................................619
CamilleBeckman..........................................................................................................619
CargoCosmetics...........................................................................................................620
CarmaLaboratories......................................................................................................621
CarolsDaughter...........................................................................................................622
Cartier...........................................................................................................................622
CCAIndustries..............................................................................................................623
CellexCInternational...................................................................................................624
Chrysallis.......................................................................................................................625
TheColomerGroup......................................................................................................625
CorSilverSkincare........................................................................................................626
CosrichGroup...............................................................................................................627
DanaClassicFragrances...............................................................................................627
DeadSeaLaboratories..................................................................................................628
DeborahLippmann.......................................................................................................629
DemeterFragranceLibrary..........................................................................................629
Dermalogica..................................................................................................................630
DermovivaSkinEssentials............................................................................................631
TABLEOFCONTENTS
(Continued)
Page
MINORCOMPANIES(Continued)
Devacurl........................................................................................................................632
Dr.BronnersMagicAllOne.........................................................................................632
Dr.Fresh.......................................................................................................................633
Dr.HauschkaSkinCare.................................................................................................634
E.L.F.Cosmetics............................................................................................................634
EquitiumGroup............................................................................................................635
EOSProducts................................................................................................................636
ErnoLaszlo....................................................................................................................637
E.T.Browne...................................................................................................................637
Euroitalia.......................................................................................................................638
ExpanscienceLaboratories...........................................................................................639
FaceStockholm.............................................................................................................640
FalicFashionGroup......................................................................................................640
Focus21........................................................................................................................641
FreemanBeauty...........................................................................................................642
Fresh.............................................................................................................................642
FruitoftheEarth..........................................................................................................643
FusionBrands...............................................................................................................644
GaldermaLaboratories.................................................................................................644
TheGap.........................................................................................................................645
GiovanniOrganicCosmetics.........................................................................................646
GoSmile........................................................................................................................646
GraceChoi....................................................................................................................647
HairRules......................................................................................................................648
HamptonSun................................................................................................................648
HerbalifeInternational.................................................................................................649
HermsInternationalGroup........................................................................................649
HouseofCreed.............................................................................................................650
InterfashionCosmetics.................................................................................................650
Interparfums.................................................................................................................651
InspiredBeautyBrands................................................................................................652
IredaleMineralCosmetics............................................................................................652
ITCosmetics..................................................................................................................653
J.Strickland...................................................................................................................654
JafraCosmeticsInternational.......................................................................................655
4A2
TABLEOFCONTENTS
(Continued)
Page
J.M.Products................................................................................................................655
JoeyNewYork..............................................................................................................656
JohnPaulMitchellSystems..........................................................................................656
JohnsonPublishingCompany.......................................................................................657
JonathanProduct.........................................................................................................658
JosieMaranCosmetics.................................................................................................659
JuiceBeauty..................................................................................................................659
KissProducts.................................................................................................................660
KissMyFace.................................................................................................................661
KosAmerica................................................................................................................662
Laqa&Co......................................................................................................................663
LavanilaLaboratories...................................................................................................663
LOccitane.....................................................................................................................664
LoracCosmetics............................................................................................................665
LushFreshHandmadeCosmetics.................................................................................666
LusterProducts.............................................................................................................666
MarkwinsInternational................................................................................................667
Matriskin.......................................................................................................................668
MerleNorman..............................................................................................................669
MissJessies..................................................................................................................670
Murad...........................................................................................................................670
Naturopathica...............................................................................................................672
NewHarmonySoap......................................................................................................672
NotYourMother's........................................................................................................673
NuSkinEnterprises.......................................................................................................674
Nyx................................................................................................................................674
Orlane...........................................................................................................................675
OrlyInternational.........................................................................................................676
OsmiaOrganics.............................................................................................................677
Ouidad(JHPartners)....................................................................................................677
Palladio.........................................................................................................................678
ParfumsDeCoeur.........................................................................................................678
PerioProducts..............................................................................................................679
PerriconeMD................................................................................................................680
PierreFabreGroup.......................................................................................................681
TABLEOFCONTENTS
(Continued)
Page
PrestigeCosmetics.......................................................................................................682
PrimalElements............................................................................................................683
PrMinerals.................................................................................................................683
Pure&Basic..................................................................................................................684
Rahua............................................................................................................................685
ReckittBenckiser..........................................................................................................685
RenCleanSkincare.......................................................................................................686
RohtoPharmaceutical..................................................................................................687
RosebudPerfumeCompany.........................................................................................688
ShakleeCorporation.....................................................................................................688
SisleyCosmetics............................................................................................................689
SmellBent.....................................................................................................................690
SteinerLeisure..............................................................................................................690
SueIsmiel&Daughters................................................................................................691
SundayRiley.................................................................................................................692
Sunstar..........................................................................................................................692
Tarte.............................................................................................................................693
TatasNaturalAlchemy................................................................................................693
TedGibson....................................................................................................................694
TooFacedCosmetics....................................................................................................695
UniversityMedical........................................................................................................695
Urth...............................................................................................................................696
ValeantPharmaceuticals..............................................................................................697
VapourBeauty..............................................................................................................698
TheVillageCompany....................................................................................................698
VincentLongo...............................................................................................................699
VogueInternational....................................................................................................6100
WeiEast......................................................................................................................6101
Weleda........................................................................................................................6101
YesTo..........................................................................................................................6102
YvesRocher................................................................................................................6103
4A4
MINORCOMPANIES
Table61:U.S.ManufacturersSalesofCosmeticsandToiletriesforSelect
$Million
Company
2011
MarkwinsInternational
180
216
155
156
LOccitane
88
94
86
92
PerriconeMD
79
84
ReckittBenckiser
79
80
YvesRocher
68
73
Arbonne
64
67
VogueInternational
60
63
Dr.Fresh
57
58
61
57
AtlanticCoastMediaGroup
70
55
Dermalogica
51
53
Blistex
55
52
InterParfums
41
48
Abercrombie&Fitch
46
47
JohnsonPublishingCompany
46
47
Chrysallis
43
43
LushFreshHandmadeCosmetics
41
43
TheColomerGroup
41
42
J.M.Products
39
40
MerleNormanCosmetics
41
40
JafraCosmeticsInternational
38
38
Murad
34
35
TheGap
33
35
E.T.Browne
33
34
LusterProducts
33
34
(Continued)
2012
62
MinorCompanies
$Million
Company
2011
CarmaLaboratories
33
33
AstralBrands
32
32
Beauticontrol
30
32
TooFacedCosmetics
30
32
E.L.F.Cosmetics
24
32
RohtoPharmaceutical
31
31
SteinerLeisure
30
31
YesTo
29
31
ShakleeCorporation
30
30
AllianceBoots
29
29
KissMyFace
27
29
EosProducts
16
29
NuSkinEnterprises
24
25
HerbalifeInternational
23
25
SunstarInc
24
24
Dr.HauschkaSkinCare
23
24
DeadSeaLaboratories
22
24
CarolsDaughter
23
23
ParfumsdeCoeur
22
23
IredaleMineralCosmetics
22
22
Dr.Bronner's
19
20
PerioProducts
18
20
BonneBell
21
19
AubreyOrganics
18
19
CellexCInternational
18
18
JoeyNewYork
16
18
AlsGroupe
17
17
AnthonyBrands
16
17
CCAIndustries
16
17
Euroitalia
15
17
Ouidad
14
15
PierreFabreGroup
14
15
(Continued)
4A2
2012
MinorCompanies
$Million
Company
2011
2012
FusionBrands
14
14
Amorepacific
12
14
Cartier
12
13
EquitiumGroup
12
13
JosieMaranCosmetics
12
13
14
12
GoSmile
12
12
InterfashionCosmetics
12
12
CargoCosmetics
11
12
KissProducts
11
12
TheVillageCompany
11
11
Fresh
10
11
HouseofCreed
10
11
SisleyCosmetics
10
11
Weleda
10
11
11
10
PrestigeCosmetics
11
10
CamilleBeckman
10
10
SueIsmiel&Daughters
10
10
GiovanniOrganicCosmetics
10
PrimalElements
10
DemeterFragranceLibrary
DermovivaSkinEssentials
FreemanBeautyLabs
HermesInternationalGroup
OrlyInternational
Pure&Basic
Orlane
FaceStockholm
Focus21
WeiEast
ErnoLaszlo
(Continued)
63
64
MinorCompanies
$Million
Company
2011
2012
FruitoftheEarth
J.Strickland
LavanilaLaboratories
LoracCosmetics
RenCleanSkincare
BlowPro
Cosrich
BlueQ
ByTerry
CorSilverSkincare
RosebudPerfumeCompany
HamptonSun
PurMinerals
Nyx
Tarte
UniversityMedicalProducts
SmellBent
FalicFashionGroup
JuiceBeauty
MissJessies
TatasNaturalAlchemy
Urth
DeborahLippmann
BradBiophotonic
KoseAmerica
TedGibson
ITCosmetics
Naturopathica
SundayRiley
VincentLongo
HairRules
(Continued)
4A4
MinorCompanies
$Million
Company
2011
2012
NotYourMothers
VapourBeauty
BarcForMen
Beekman1802
Devacurl
GraceChoi
JonathanProduct
Laqa&Co
Matriskin
NewHarmonySoap
OsmiaOrganics
Palladio
Rahua
aNegligible.
ABERCROMBIE&FITCH
Abercrombie & Fitch was founded by David T. Abercrombie and Ezra Fitch in 1892. It went
publicin1996.ThecompanyisheadquarteredinNewAlbany.Abercrombie&Fitchisaspecialty
retailerofcasualapparelandaccessoriesforyoungmen,women,andkids.Thecompanysells
itsproductsundertheAbercrombie&Fitch,AbercrombieKids,GillyHicks,andHollisterbrands.
Asof2012,thecompanyemploysapproximately8,500people.
In2012,thecompanyoperates1,050storesinNorthAmerica,Europe,andAsia.Thecompany
operates 942 stores in the United States comprising 279 Abercrombie & Fitch stores, 154
Abercrombiestores,491Hollisterstores,and18GillyHicksstores.Internationally,thecompany
operates 107 stores: 15 Abercrombie & Fitch stores, five Abercrombie stores, 84 Hollister
stores, and 3 Gilly Hicks stores. The company primarily promotes its products through its
website. The company operates stores and directtoconsumer operations, offering personal
careproducts,sleepwear,andathomeproductsforwomenundertheGillyHicksbrand.
65
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MinorCompanies
The company sells only fragrances in the cosmetics and toiletries industry, and its brands
includeFierceCologne,A&F1892(formen);8,andWakely(forwomen).Theapproximateretail
pricefortheirproductsisbetween$40.00and$85.00.FierceCologneand8areconsideredto
bethesignaturescentsofthecompanyandarethemostheavilypromotedbrands.Perfume41
forwomenisnolongerbeingsoldbyAbercrombie&Fitchin2012,butthecompanywillnot
confirmitsdiscontinuation.NoTMEforAbercrombie&Fitchsbrandsareevidentin2012.
Theglobalsalesofthecompanyareestimatedat$4.1billionin2012.Manufacturerssalesin
theU.S.cosmeticsandtoiletriesmarketforthecompanyare$47millionin2012,up2.2%from
$46millionin2011.
ALSGROUPE
In1969,PatrickAlsfoundedPhytosolbaLaboratories,whichwasrenamedastheAlsGroupe
in1999.ThecompanysheadquartersisinParis,France.Thegrouphasestablishedsubsidiaries
in nine countries including the United States, Germany, the United Kingdom, and Italy. The
companys American subsidiary was established in New York in 1989. Als Groupe employs
approximately920peopleworldwide,with30employeeslocatedatitsU.S.office.
The company manufactures and markets fragrances, hair care, and skin care products under
thebrandnamesPhyto,PhytoSpecific,SecretProfessional,Kydra,Lierac,Caron,andDucastel.
In the United States, the company markets the Phyto and PhytoSpecific brands of hair care,
Lierac brand of skin care products, and Caron fragrances. The hair care brands Phyto and
PhytoSpecific are sold through highend salons and over 900 retail stores, including Sephora,
Bloomingdales, and Bergdorf Goodman. Caron fragrances are sold in around 50 department
storesandselectindependentspecialtystores.ThedepartmentstoresthatsellCaronproducts
includeSaksFifthAvenue,Nordstrom,BergdorfGoodman, HenriBendel,andBloomingdales.
Products from the group are also sold through drug store chains, such as Rite Aid, CVS
Pharmacy,DuaneReade,andBrooksPharmacy.
CorporatesalesforAlsGroupegrow7.3%from$254millionin2011to$273millionin2012.
TheU.S.manufacturerslevelsalesofcosmeticsandtoiletriesareestimatedataflat$17million
in2012.AlsGroupehasnegligibleTMErecordedin2012.
ALLIANCEBOOTS
AllianceBootsisaleadingmanufacturer,distributor,andretailerofhealthcare,pharmaceutical,
and consumer products worldwide. Named originally The Boots Company at the time of
foundingin1849,thecompanychangeditsnametoAllianceBootsinJuly2006.Thecompany
developsanddistributesmedicines,toiletries,skincareproducts,makeup,fragrances,andbaby
nutrition,aswellaspharmacyanddispensingservices.
4A6
MinorCompanies
Alliance Boots headquarters is located in the United Kingdom. The companys two core
businessactivitiesarehealthandbeautyretailing,andpharmaceuticalwholesaling.In2012,it
distributes medicines and other healthcare products to approximately 170,000 pharmacies,
doctors, health centers, and hospitals from over 370 pharmaceutical wholesale distribution
centersin25countries,includingassociatesandjointventures.In2012,AllianceBootsoperates
3,330healthandbeautyretailstoresin11countries,ofwhichover3,200haveapharmacy.
Alliance Boots operates in 25 countries including the United Kingdom, the United States,
France, Italy, the Netherlands, Germany, and Russia. Alliance Boots is a privatelyowned
companyandemploysover116,000peopleworldwide.
BootsRetailUSAoperatesasasubsidiaryofAllianceBootsintheUnitedStates.Thecompany
entered the U.S. market in 2004 by selling some of its makeup, skin care, and other beauty
products.AllianceBootsproductsareavailablewithretailers,suchasTarget,CVS,andShoppers
DrugMart.Asof2012, BootsproductsaresoldintheUnitedStatesinallTargetstores,over
450 CVS pharmacies, and over 650 Shoppers Drug Mart locations. The company employs
approximately30peopleintheUnitedStates.
Bootsmarketssixbrandsofcosmeticsandtoiletriesproductsinover670SKUs.BootsNo.7is
the leading brand for the company, with products in the makeup, skin care, and toiletries
productclasses.Botanicsisalineofplantbasedproductsthatincludesmakeup,skincare,and
hair care products. Time Dimensions is the companys antiaging product line. Boots Expert
solveseverydayskinconcerns.BootsOriginalBeautyFormulaoffersproductsintheskincare
and bath and body category. The Hawaiian Islands, Mediterranean, and Amazon Forest
Productsarearangeofhypoallergenicanddermatologicallytestedproductscreatedusingonly
organicingredients.
InApril2012,AllianceBootslauchesanewproductunderitsNo7brand,Lift&LuminateDay&
NightSerumforwomenaged45andabove.Itissaidtobeclinicallyprovenandhelpstofade
agespotsandvisiblyliftskintoreducetheappearanceofdeeperlinesandwrinkles.Alliance
BootspromotesitsproductsthroughvarioussocialmediasiteslikeFacebookandPinterest.It
spendslessthan$100,000inTMEintheUnitedStates.
As of September 2012, Walgreen Co., owns a 45% equity interest in Alliance Boots GmbH.
AllianceBootssetsupanewcompanyWalgreensBootsAllianceDevelopmentGmbH,jointly
ownedwithWalgreen.ThecompanyisbasedinBerne,Switzerland.AllianceBootswillaccount
foritsinterestasajointventure.
ManufacturerssalesofcosmeticsandtoiletriesforthecompanyintheUnitedStatesareflatat
$29million,sameasin2011.
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MinorCompanies
AMOREPACIFICCORPORATION
AmorepacificCorporationisaKoreabasedchemicalandcosmeticscompany.Thecompanyis
headquartered in Yongsangu Seoul, South Korea. Amorepacific was founded by SungHwan
Suh.Amorepacifichasbeenamanufacturerofcosmeticssincethe1930s.
AmorepacificenteredtheUnitedStatesin2003.Althoughthecompanyprovidesitsofferings
under many categoriescosmetic products; skin care products; makeup products; fragrances
for men and women; personal care products, and health care productsit has restricted
presenceintheUnitedStateswithonlyskincareandmakeupproducts.In2008,Amorepacific
introduced its first makeup product, Time Response Skin Renewal Foundation in the United
States.SomeofthecommoningredientsusedinAmorepacificskincareproductsincludegreen
tea,bamboosap,andredginseng.
Time Response is the companys biggest line in the United States, however the Treatment
Enzyme Peel, which is said to help brighten and even skin tone while giving a smooth
complexion,isthebestsellingproduct.
In 2012, the companys introductions in the facial treatments category includes the new
advanced Time Response Intensive Skin Renewal Ampoule, a fourweek skin enhancement
system,theFutureResponseAgeDefenseCreme,anantiagingcreamthatfightssignsofaging
andrestorestheskinsabilitytoregeneratecellsforayouthfulexperience,theLuminousEffect
Brightening Serum formulated with Asian botanicals to help reduce signs of age spots and
hyperpigmentation for a flawless and luminous complexion, and the Luminous Effect
Brightening Masquemicrofiber material masque that provides immediate skin brightening
effect.Additionally,thecompanylaunchestheLimitedEditionHolidayTimeResponseFlawless
SkinSet,LimitedEditionMoistureBound,andFutureResponseHolidaySet.
Amorepacific is active on social networking platforms, such as Facebook and Twitter to

promoteandmarketitsproductsandatthesametimebuildsapersonalrelationshipwithits
consumers. The brand also relies on PR activities to spread the word around on its latest
happenings,whichincludewriteupsinmagazines,suchasAllure,OKMagazine,Pregnancyand
Newborn,NewBeauty,andMarieClaire.Giveawaysanddeals,suchasluxuriousspagetaways
are also another attractive marketing medium adopted by the brand. The brand organizes a
numberofinstorebeautyeventsatretailers,suchasNeimanMarcusandBergdorfGoodman.
The company has a minimal TME of $0.9 million, with all of it attributed towards magazine
advertisements.
Amorepacific skin care products are available at select Neiman Marcus, Nordstrom, Sephora,
Bergdorf Goodman, Holt Renfrew, and Cosbar stores, as well as Amorepacific Beauty Gallery
andSpainSOHOandNYC.In2012,thecompanyexpandsitsdistributionnetworkinNeiman
Marcus and Sephora stores and penetrates into the online channel. Amorepacific has highly
trained sales representatives for instore sales and creates events to give consumers a good
experience.ThecompanyprovidestheBeautyCreatorservicewherebysalesrepresentatives
perform demonstrations on skin hygiene and skin care regimens and build relationships with
prospectconsumers.
4A8
MinorCompanies
U.S. manufacturers sales of cosmetics and toiletries for the company are estimated at
ANTHONYBRANDS
The New York Citybased Anthony Brands was established by Anthony Sosnick in 1998. In
October2000,thecompanylauncheditsretaildistributionof30productsdesignedspecifically
for male grooming. Today, the company specializes in the research and development of
personalcarebrandsspecificallytargetingtheneedsofboth,menand,morerecently,women.
The company offers over 100 SKUs with brands, such as Anthony Logistics for Men, Action,
Anthony For Little Men, and Shaveworks The Cool Fix. Anthony Logistics for Men is the
companysleadingbrand.
The marketers products are distributed in about 2,000 retail doors across the United States.
StoresthatsellthecompanysproductsincludeNordstrom,Bath&BodyWorks,Sephora,Ulta,
and C.O. Bigelow. Internationally, the company is present in over 28 countries. Products are
alsosoldonlinethroughthecompanyswebsite.
Anthony Brands promotes its products primarily through sampling, instore events, and
editorialplacements.Themarketerpromotesitsproductsthroughsocialnetworkingwebsites,
such as Facebook and Twitter. The option of online chat on its website is also available.
AnthonyforMenalsorunsaweblogthatpromotesvisibilityofitsproductsthroughdiscussions
on mens fashion and grooming trends. The company apportions an insignificant amount of
TMEin2012.
Among the bestselling products is a parabenfree Glycolic Facial Cleanser with aloe vera for
soothingbenefits,glycolicacidtoeaseawayfinelines,vitaminsA,C,andEforskinnourishing,
aswellasashavecreamdesignedforallskintypes.
Someofthenewproductsintroducedin2012includeBlueChamomilehairandbodycleansing
gelwhichhelpstocleans,hydrate,andconditiontheskin,andincludesingrediantslikeglycerin,
aloe vera, wheat protein, and revitalizing chamomile; Instant Fix Oil Control, which helps to
instantlyabsorbexcessgreaseoncontactandkeepshineatbayallday.Italsohelpstoreduce
the appearance of pores. For 2013, the company is getting ready to launch a new brand
focusedontheskincareneedsformenandwomencalledGrandmaStelles.
The marketer offers free shipping on any order exceeding$50.00. The company also does its
promotional and marketing activities through social websites like YouTube, Twitter, and
Facebook. Complementary deluxe samples with every purchase are also offered by the
company.
69
610
MinorCompanies
Manufacturers sales of U.S. cosmetics and toiletries for the company are estimated at
$17million in 2012, up 6.3% from $16 million in 2011 and mainly driven by new product
launches.
ARBONNE
ArbonneInternational,LLC,basedinIrvine,CA,isadirectsellingcompanythatmanufactures
anddistributescosmeticsandtoiletries,aswellasnutritionalsupplements.Thecompanyisa
formersubsidiaryofLevlad,LLC.
Thecompanywasfoundedin1975inSwitzerlandbyPeterMorckandagroupofleadingbio
chemists,biologists,andherbalists.ArbonnebeganitsdistributionintheUnitedStatesin1980
andsellsonline,aswellasthroughitsnetworkofindependentsalesconsultants.
NaturalProductsGroup,theformerownerofArbonneInternationalandLevlad,LLC,filedfor
Chapter11bankruptcyattheUnitedStatesBankruptcyCourt,inDelaware,inearly2010.The
currentownersofArbonneInternationalaretheformercreditorsoftheArbonneandNatural
Productsgroup,whichincludescompanieslikeGECapital.Inthebankruptcyprocess,Natural
ProductsGroupexchanged85%ofitsequitywithitsbanks,includingGECapital,for80%ofits
debt.
Arbonnes products include shampoos, conditioners, premium facial cleansers, moisturizers,

antiaging sun care products, and baby skin care products along with detoxification,
aromatherapy, weight loss, and nutrition products. Arbonne is also positioned as a natural
brandanditsproductsarepricedhigherthanmostotherdirectsalesproductsaswellasmany
othernaturalproducts.
Arbonnes products are shared across the world through its network of independent
consultants. The company also offers products through its online shop,
www.arbonne.com/shop_online/shopOnline.asp. Its products are marketed through the
independent sales consultants rather than through traditional advertising. Arbonne allocates
$319,200inTMEin2012.
Thecompanylaunchesitsseasonal 2012HolidayCollection,whichincludes16newproducts.
These products include Mandarin Pomegranate Hair and Body Care, the Comet Cosmetic
Collection, and a limited edition Arbonne The Angel Signature Fragrance. Arbonne promotes
throughsocialanddigitalmediasiteslikeFacebook,Twitter,andYouTube.
Arbonne also launches three personal care products in 2012: Pure Mint Deodorant, an
aluminiumfree deodorant; Pure Mint Mouthwash, which is alcoholfree; and Pure Mint
Toothpaste,aflouridefreetoothpaste.
4A10
MinorCompanies
HeatherChastainisappointedSeniorVicePresidentandChiefSalesOfficer.AsofSeptember
2012, Chastain, a recognized direct sales industry executive, oversees Arbonnes sales
organization. Other news regarding the company is that in the summer of 2012, another
Executive National Vice President (ENVP) leaves the company. This is the highest position
Arbonneconsultantscanachieve,andthethreepeoplewhohaveachievedthispositionhave
allleftthecompany.Thisindicatesproblemsinthestructureforthehighestleadershiplevelsof
Arbonneandforitslongtermgrowthpotential.
SalesofcosmeticsandtoiletriesforArbonneatthemanufacturerslevelintheUnitedStates
reach $67million in 2012, up 4.7% from $64 million in 2011, supported by new product
launchesandanincreaseinthenumberofconsultantssellingitsproducts.
ASTRALBRANDS
Astral Brands, founded in 1978, was formerly known as Aloette Cosmetics. In 2005, the
company changed its name. The company operates two subsidiaries: Astral Health& Beauty
and Astral Foods. Astral Brands manufactures and markets beauty care and food products in
theUnitedStates,Canada,Australia,theUnitedKingdom,Japan,andtheRussianFederation.
AstralBrandsisheadquarteredinAtlanta,GAwithanadditionallocationinBaltimore,MD.As
of2012,AstralBrandsemploysapproximately330peopleinitstwofacilitiesinAtlanta,GA,and
Baltimore,MD.
The company offers cosmetics and skin care products under three major brands: Aloette,
Cosmedix,andPrMinerals.Aloette,thecompanysflagshipbrand,offersskincare,makeup,
and bath and body products through the direct sales channel. Aloette's aloe verabased skin
careproductsandcosmeticsaresoldmainlythroughhomepartiesheldbyAloette'sdirectsales
network.Thebrandhasmorethan10,000consultantsinaprroximately40franchisesacrossthe
UnitedStatesandCanada.Aloetteswebsitealsooffersproductsforsaleonline.Aloettesskin
care line focuses on botanicalbased facial treatment products, offering antiaging products,
moisturizers,exfoliants,andacneproducts.
Cosmedix is a dermatologybacked professional skin care brand marketed by Astral Health&

Beauty. They are a line of premium skin care products sold only at professional spas. Pr
Mineralsisabrandofmakeupandskincareproductsformulatedwithmineralingredientsand
sells well through Ulta stores nationwide, and is also offered in Dillards and Trade Secret
stores.Allthreebrandsarealsosoldonlineandontelevisionshoppingchannelswhichinclude
QVC.In2012,thecompanydoesnothaveanyevidentTMEforitsproducts.
In 2012, Astral Brands introduces Super Shot, a multipurpose cosmeceutical booster that the
company claims enhances the performance of everyday skin care and cosmetic products. All
thenewproductlauchesarepromotedthroughvarioussocialnetworkingsiteswhichinclude
FacebookandTwitter.
611
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MinorCompanies
In2012,thereareafewmanagementchangesforthecompanywhichincludeRobertCohen,
AstralHealth&Beautysfounderandchairmanoftheboardnowmadetheexecutivechairman.
StephenMerrickistheCFO,EricAllenisthevicepresidentofoperations,TammyBlytheisthe
vicepresidentofsalesandtrainingforPrMinerals,andTishaThompsonispromotedandis
the vice president of brand marketing for Pr Minerals. Manufacturers sales in the United
StatesforAstralBrandsareestimatedtototal$32millionin2012,evenwith2011levels.
ATLANTICCOASTMEDIAGROUP
AtlanticCoastMediaGroup,headquarteredinNewJersey,wasfoundedin2005bytwodirect
response marketing professionals, Andrew Surwilo and Thomas Shipley. Atlantic Coast Media
Group is one of the prominent national and multichannel personal care products marketers,
withakeyfocusonimprovingthepersonalandlifestyleneedsofbabyboomers.
Thecompanyhasnutraceuticalandcosmeceuticalproductsavailableinthehealthandbeauty
marketplace,andworksinthepersonalcareandsupplementindustry,underbrands,suchas
Hydroxatone, Hydrolyze, Celtrixa, Declatone, Luminique, Instant Effect, Besotone, and
Venacura.
ThemarketerlaunchesKeraniqueHairRegrowthKitin2012,anewantiagingsolutiontotreat
femalehairthinning,hairloss,andtoaddresstherootcauseofissuesassociatedwiththeaging
ofhair.
Atlantic Coast Media Group enjoys a significant brand recall due to its longterm association
withover3,000televisionandradiostationsacrosstheUnitedStates,aswellasthrough500
major newspapers and magazines. It promotes through social media sites, such as Facebook,
withquizzesandotherchancestowinfreeproducts.NoTMEforthecompanysproductsare
evidentin2012.
The companys manufacturers sales of cosmetics and toiletries in the United States for 2012
areestimatedat$55million,down21.4%from$70millionin2011.Thedropismainlydueto
Hydroxatonespoorperformancefromitslossofdistribution,keypeopleleavingthecompany,
andalargenumberofconsumercomplaintsoffraudulentcreditcardcharges.
AUBREYORGANICS
Tampa,FLbasedAubreyOrganicsisamarketerofcosmeticsandpersonalcareproductsbased
onnaturalingredients.Thecompanywasfoundedin1967byAubreyHampton.
4A12
MinorCompanies
Aubrey Organics markets a wide range of products spanning across the skin care, hair care,
makeup, and fragrance product classes. The companys products are formulated with 100%
natural products and are sold under the companys flagship brand, Aubrey Organics. The
companyhasover200productsandissoldinmorethan4,500retailersworldwide.
Aubrey Organics was one of the first personal care companies to be certified as an organic
processor according to the standards set by the U.S. Department of Agriculture (USDA). The
company has obtained organic certification by two other certifying bodies in the United
States:NaturalProductsAssociation(NPA)andQualityAssuranceInternational(QAI).BDIH,the
associationofGermanmarketersofpharmaceuticalsandpersonalcareproducts,alsocertifies
thecompanysproductsasorganic.
In 2012, the company launches new products in the skin care and hair care product classes.
Under the skin care product class the company launches Natural Sun suncreens which offers
threekindsofsunprotection:Sundeflectingmineralsformingaprotectivebarrierthatkeeps
UVA/UVB rays off the skin; antioxidants prevent free radical damage; and botanical
moisturizersprotectskinfromthedryingeffectsofthesun.In2012,thecompanyalsolaunches
twonewadditionstoitslineofscentedwomen'sshavingcreams:CrmedelaShavewithwhite
teaandcitrusfragrance,andCrmedelaShavepomegranatefragrance.Underthehaircare
product class, the company launches two new fragrances under its range of GPB Glycogen
Protein Balancing shampoos: GPB rosemary peppermint shampoo and conditioner and GPB
lavenderYlangYlangshampooandconditioner.
AubreyOrganicssellsitsproducts onlinethroughdedicatedwebsiteintheUnitedStates,the
United Kingdom, Japan, and Russia. It also distributes its products through retailers, such as
PacificHealthFoods,WholeFoods,VitaminShoppe,HealthNuts,andSunHarvest.
Aubrey Organics conducts its promotional and marketing activities through various social
networking sites like Facebook and Twitter. The all natural product range is advertised on
Facebook.Italsospendsalittlemorethan$600,000onmagazineadvertising.AubreyOrganics
allocatesTMEof$1.1millionin2012.
AubreyOrganicsU.S.salesofcosmeticsandtoiletriesareestimatedat$19millionin2012,up
5.5%from$18millionin2011,mainlydrivenbynewproductlaunches.
BARCFORMEN
BarcforMenisaspeciallyformulatedlineofskincareproductsformen.Itwasfoundedin2005
and is located in New York, NY. The companys products are alcoholfree, oilfree, and
fragrancefreeandworkonallskintypesandskintones.
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MinorCompanies
BarcforMenmarketsshavingcreamsandpostshavelotions.Itsproductsaredevelopedunder
two brand namesBump Down and Cutting Up. Bump Down is a facial repair treatment to
reduceingrownhairandirritationcausedduetoshaving.Italsohealsoldbumpsandprevents
new ones from coming up. The product has to be applied immediately after shaving. Bump
Downisavailableintwosizes1.7fl.oz.and3.4fl.oz.andasatripackwhichisasetofthree
1.7ounceproducts. Cutting Up is a shaving cream that softens hair to ensure smooth shave
andpreventsshavebumps.Itisavailableintwosizes:2fl.oz.and6fl.oz.Nonewvariantswere
introducedin2012.
BarcforMenbrandsarepromotedonsocialnetworksiteslikeTwitterandFacebook.Products
areavailableatselectstores,spas,boutiques,andpharmaciesintheNewYorkCityarea.
Corporatesalesofthecompanyareestimatedtobeunder$1millionflatfrom2011levels.
BEAUTICONTROL(TUPPERWAREBRANDS)
BeautiControl is one of the subsidiaries of Tupperware Brands Corporation that markets

cosmeticsandotherpersonalcareproducts.BeautiControlisadirectmarketerheadquartered
in Carrollton, TX. The companys products are sold through over 140,000 independent
consultants intheUnitedStates,PuertoRico,andCanada. Asof 2012, thecompanyemploys
700personnelwithabout325employeeslocatedinthecompanysheadquarters.
BeautiControl markets products across skin care, makeup, fragrances, and the personal
cleansingproductclasses.AntiagingproductsformasignificantportionofBeautiControlsskin
care offerings. The latest among the companys product introductions in 2012 include Dark
Brown sugar collection,which includes body wash, instant manicure, and body creme; and
Regeneration Tight Firm & Fill Extreme Eye Complex, which helps to conceal fine lines and
wrinklesaroundtheeyesin15minutes.
Besidesrelyingonitssalesconsultantstomarketitsproductsdirectly,thecompanyconducts
its promotion and marketing through various social media sites which include Facebook,
Twitter, Tumblr, YouTube, Printerest, and Instagram. It does not do traditional advertising in
2012.BeautiControlalsohasapartnershipwithWomenHelpingOthers(WHO)foundation,that
supports communityfocused charities that serve the overlooked needs of women, children,
andfamilies.
Totalcompanyssalesareapproximately$87millionin2012.ManufacturerslevelsalesinU.S.
cosmetics and toiletries are $32 million in 2012, up 6.7% from $30 million in 2011, mainly
drivenbythepromotionalactivitiesandnewproductlaunches.
4A14
MinorCompanies
BEEKMAN1802
JoshKilmerPurcellandBrentRidgefoundedBeekman1802in2008.BasedinSharonSprings,
NY,thetwofoundersincludedaneighboringfarmerandhisdairygoatsintheirBeekmanfarm
and started producing cheese and soaps. The company now markets beauty products, food
items, stationery, linens, and a few other products. The skin care products are all made with
goatsmilk,thatthecompanyclaimsmoisturizesandbeautifiesskin.
Thecompanysproductportfolioincludesskincareproducts,suchasmoisturizers,bodysoaps,
and body washes; and oral care products namely, lip balms. Beekman 1802 Tub of Butter
launchedin2012hasmoisturizingbenefitsofsheabutterandgoatsmilk.Itisavailableinfour
scents:spring,summer,autumn,andwinter.ThecompanyalsolaunchesLumpofKohl,adetox
treatment that uses bamboo charcoal to remove impurities and chemicals from the skin and
puregoatsmilktomoisturizetheskinandkeeptheskinspHbalance.Beekman1802Stickof
Butter Simply is a moisturizing lip balm. The companys bar soap, named Beekman 1802, is
availablein12variants,eachnamedafterdifferentmonthsoftheyearandarepromotedfor
useontheface,body,andevenhair.TheSignatureTwoBarBagshavetwosoapsinaclothbag,
promotedasagiftitem.Beekman1802alsomarketsfoursoapsnamedafterthefourseasons
of the year. Beekman 1802 MilkShake is a milk bath made of goats milk available in four
variantsspring,summer,autumn,andwinter.
ProductsarepromotedonsocialnetworksiteslikeFacebook,Pinterest,Twitter,Google+,and
Tumblrandinpopularmagazines,suchasVogue,MarieClaire,Lucky,andElle.Beekman1802
productsareavailableatHenriBendelFifthAvenueandinanumberofboutiquesintheUnited
States. Internationally, the company sells to countries like Norway, Denmark, England, China,
andAustralia.
Beekman1802employsoneparttimeandthreefulltimeemployees.Thecompanyisexpected
to be growing rapidly and total sales are estimated to be under $1 million in 2012. Beauty
products contribute to around 60% of the domestic sales. Increasing awareness and
introductionofnewproductsaremajorfactorscontributingtosalesgrowthofthecompany.
BLISTEX
Blistex,Inc.,foundedin1947,primarilydevelopsandmarketslipcareproducts.Thecompanyis
headquartered in Oak Brook, IL, where it conducts its research and development and
manufacturingoperations.ThecompanyisbestknownforitsBlistexliptreatmentproducts.
Blistex also markets other personal care and healthcare brands, such as StriDex acne
treatments, Ivarest poison ivy itch relievers, KankA oral pain relievers, Glysomed hand and
bodyproducts,andFoillemedicatedfirstaidointment.
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MinorCompanies
Blistex offers a wide range of lip care products including ointments, balms, and medicated
products. Some of the products under Blistex include Simple Essentials, Natural Cooling
Comfort,DCT(DailyConditioningTreatment),FiveStarLipProtection,CompleteMoisture,and
LipInfusion.
In 2012, Blistex launches two new products: Moisture Melt, a superhydrating lip balm with
moisturizing softbeads; and Simple and Sensitive that moisturizes the most sensitive lips
withoutirritation.
Blistexsellsitsproductsthroughsupermarkets,foodstores,dollarstores,anddrugandbeauty
stores,includingKroger,Ulta,Target,Walmart,RiteAid,CVS,Walgreens,DollarGeneral,Dollar
Tree,drugstore.com,andamazon.com.
Blistexadvertisesthroughcabletelevision,magazines,storepromotions,andthe Internet.As
Internetmarketinggainspopularity,likemostothernationalbrands,Blistexhasitspresenceon
Facebook. Blistex Facebook page is used to discuss new products, receive feedback about
them, and display pictures of the variants. The companys website has a special section, Lip
Tips,whichtalksaboutcommonlipproblems,suchaslipdrynessandchapping,sundamage,
andaging.Italsolistssometipstoensuregoodhealthoflips.TotalTMEforBlistexslipbalm
productsareapproximately$7.6billionin2012.
AsofJune2012,Blistexemploysapproximately200people.
The manufacturers sales of cosmetics and toiletries in the Unites States for Blistex are
estimated at $52 million in 2012, down 5.5% from $55 million in 2011. Sales for its lip balm
productsareerodedbysteepcompetitionfromEOS,Nivea,andBurtsBees,whicharepursuing
aggressivemarketingtactics.
BLOWPRO
BlowProwasfoundedin2005bythreefriendswhoenvisionedandcreatedasalonthatwould
provide hair blowdry (often referred to as blowout) services exclusively. The company first
openeditsdoorstoManhattansMeatpackingDistrictbyofferingsignatureblowoutservices.
Blow Pro is headquartered in New York. In 2008, the company launched the Blowpro line, a
uniquelineofproductsdesignedtogivebetterblowdryresults.
BlowProsproductsarefreeofsulfates,parabens,andsodiumchlorideandarecompliantwith
keratin treatment. Blow Pro offers three line of products: Clean + Nourish, Prep + Style, and
Finish+Refresh.Theproductrangeincludesshampoos,conditioners,andhairstylingproducts.
BlowProsproductsfindmentioninleadingmagazines,suchasSelf,Health,Latina,OK,Modern
Salon, American Salon, Beauty Launchpad, and InStyle. The company does not allocate any
evident TME in 2012. Blow Pro also holds customized parties, such as bachelorettes, bridal
showers,andweddingdaybeautywherebyconsumerscanselectfromtheirrangeofservices,
suchasblowouts,manicures,andquickfixmakeup.
4A16
MinorCompanies
BlowProslineismadeavailablethroughspecialtyretailers,suchasUlta,professionalsalons,
onlineretailerssuchasamazon.com,andthecompanyswebsite.In2012,BlowProsproducts
debutatselectNordstromlocations.
SalesofBlowProintheU.S.cosmeticsandtoiletriesmarketatthemanufacturersleveltotal
$6millionin2012,constantfromthesalesin2011.
BLUEQ
Established in 1988, Blue Q Corporation is a marketer of personal care products and is

headquartered in Pittsfield, MA. In addition to personal care products, the company markets
items,suchasbreathsprays,carairfresheners,homeaccessories,andcandy.Thecompanys
productsarenotedfortheireyecatchingpackaging,retrostylebranding,andquirkynames.
The leading cosmetics and toiletries brands from Blue Q are Dirty Girl, Miso Pretty, Mental
Case, and Wash Away Your Sins. The companys new product activity in 2012 is focused on
general merchandise, candy, and gift items. In 2012, some of the latest additions to the
companyscosmeticsandtoiletriesportfolioareMeOmLipbalm,MeOmHandcream,MeOm
bodywash,LipShitlipbalmpeachlavenderandLipShitlipbalmasianpearmint.
Thecompanysellsitsproductsonlinethroughitswebsiteandalsothroughover1,500stores
across the United States including Ulta, Urban Outfitters, Papyrus, C.O. Bigelow, Rickys, and
WholeFoods.Itdoesnotadvertiseandreliesonwordofmouthpublicitygeneratedduetothe
productsquirkybranding.
TheU.S.manufacturerslevelsalesofcosmeticsandtoiletriesforthecompanyareestimatedto
at$5millionin2012,sameas2011levels.
BONNEBELL
BonneBellisaprivatecompanyfoundedbyJesseBellin1927inLakewood,OH.Thecompany
manufacturesandmarketscolorcosmeticsgearedtowardsteensandpreteens.BonneBellhas
approximately150employees.Productsaresoldundertwobrands;BonneBellandSmackers.
BonneBellisdesignedforolderteens,featuringmoresophisticatedpackagingandafulllineof
bronzers, lip glosses, and eye makeup. Smackers wide variety of flavored lip glosses targets
youngerteensandpreteens.
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MinorCompanies
The company sells various cosmetic products including bronzers, eye shadow, eyeliner,
mascara, lip color, and lip gloss. Bonne Bell sells its products through supermarkets, drug
stores, beauty retailers, and specialty shops, as well as online. The company promotes its
products through editorial mention in magazines, such as Justine, Teen Vogue, Glamour and
Elle.
Thecompanylaunchesavarietyofnewproductsin2012.Someofitskeylaunchesinclude:
UrbanchicLipGlossclaimstomoisturizeandconditionthelips.
Undercover Concealer, oilfree concealer to camouflage dark, undereye circles, redness,
blemishes,andmore.Itcomesinthreeshades:WarmBeige,NaturalBeige,andIvoryBeige.
Lipblush moisturizes and conditions the lips, and also provides a delicate shine. It is
availableinsixsoothingflavorsincluding,PeacefulPeach,CheerfulCherry,PassionateFruit,
SereneStrawberry,Pomegranate,andVanillaChai.
TheU.S.salesofcosmeticsandtoiletriesforthecompanytotal$19millionin2012,downfrom
$21millionin2011.BonneBellhasnegligibleTMErecordedin2012.Besidesnotinvestingin
advertising, the company has internal conflicts in upper management that are preventing a
solidgrowthstrategyfrombeingimplemented.
BRADBIOPHOTONIC
BradHunterfoundedBradBiophotonicin2010asaregenerativeskincaresystemformenand
women.Thecompanysproductsaredevelopedusingbiofermentedingredientswhichactivate
collagen and elastin. Biofermentation means stimulating living cells with ultraviolet light, and
thebottlesarevioletcoloredglass,whichblocksUVlightandkeepstheactiveingredientsalive
until dispersed onto the skin. Brad Biophotonics products claim to promote skin health and
provideantiagingbenefitstoskin.ThecompanyislocatedinLosAngeles,CA,andwasinitially
createdasacustomprojecttoreducedamagedonetotheskinduetotheharsheffectsofair
travel.
BradBiophotonicsproductportfoliomarkets15SKUsofcleanser,mist,creams,andtreatment
products.Itsgelcleanserscontainingablendoffermentedacidsandplantinfusionsstimulate
theskinsrenewalprocessanditsultrapeelprovidesmulticellularexfoliationwhiledeeply
hydratingskin.Theantiagingproductcontainsproteinsandpeptidestorestorefirmnessand
elasticityofskinanditsessentialelixirsincreasethedensityofskinandofferantioxidant
defense.SomeofBradBiophotonicbrandsincludeUniversalCleansingGel,UltraElastinfirming
cream,UltraPeelexfoliatinggel(thecoreproduct),EssentialElixirPoreTightening,UltraWhite
IntensiveLightening,SeriousComfortBodyCream,UniversalShave,andTransformingBodyOil.
Nonewproductshavebeenintroducedin2012.
4A18
MinorCompanies
Brandsarepromotedinsocialnetworkingsites,suchasFacebook,Twitter,andYouTube.Brad
BiophotonicsskincareproductsareavailableatitsflagshipstoreinLosAngeles,selectretail
stores,andthroughonlineretailers,suchasdermstore.comandmyskin.com.Domesticsalesof
thecompanyareestimatedat$2millionin2012,aslightincreaseoverjustunder$2millionin
2011.Thecompanyhasplanstolaunchthroughhomeshoppingchannelsintheinternational
markets.
BYTERRY
Aftercollaboratingasamakeupartistwithpeoplefromtheworldoffashionandbeautyfor20
years, Terry launched her own signature label, By Terry in 1998. Located in Paris, France, By
Terry develops and markets face makeup products like foundations, concealers, bronzers,
powders, blush, and primers; lipsticks and lip glosses; and eye makeup products, such as eye
shadow,mascara,eyeliner;andnaillacquers.Thebrandsdifferentiatorcomesfromadvanced
packaging for the delivery of the product, such as click pens, as well as rare pigments for
specialcolorload.
Brands promoted by the company include Nectar Opulent (Intense YouthReviving Cream),
EclatDeTeint(ColorSkinEnhancer),SheerExpert(FluidFoundation),TouchExpertAdvanced
(MultiCorrective Concealer Brush), Crayon Onctueux (Multicare Lip Definer), and Terrybly
collection which includes foundations, lipsticks, lip liners, and eye pencils. In 2012, By Terry
launches Haute Parfumerie which included five fragrances Flagrant Dlice, Rve Opulent,
PartiPris, Lumire d'Epices, and Ombre Mercure. The company also launches its Hyaluronic
HydraprimerandHyaluronicHydrapowderin2012.
Products are promoted through social network sites like Facebook and Twitter. By Terrys
productsareavailableatselectretailstoreslikeBarneysNY,ArchApothecary,SpaceNK,Four
SeasonsProducts,andSephora.
Thecompanyemploysastaffofaround30people.Thesalesfor2011and2012areestimated
at$5million.
CAMILLEBECKMAN
HeadquateredinEagle,ID,CamilleBeckmanisaprivatecompanyestablishedin1986bySusan
CamilleBeckmanRoghani.Thecompanycelebratedits25thanniversaryin2011.Thecompany
marketsitsproductsintheUnitedStates,Canada,SouthPacific,Europe,theMiddleEast,and
Asia.
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The company manufactures a range of personal care products which include bath and body
products, hand lotions and creams, fragrances, and facial treatment products. The jars and
bottles are decorated with the companys signature trademark, the tiny handtied satin
rosebud.
Some of the companys bestknown brands include Midnight Monarch, Lime Leaves, and
Tuscan Honey. The bestselling products of the company are its Glycerin Soap and Coronet
Cream. The Glycerin Soap helps in retaining the skins moisture and the Coronet Cream is a
handcream.
Thecompanysdistributionnetworkisstrongwithindependentretailers;primarilygiftshops,
boutiques, and local drug stores. It retails its products through wholesalers who have a
storefront business. The products are sold online, and are also promoted on Facebook and
other social networking sites. In 2012, no TME have been reported for Camille Beckham
products.
ManufacturerslevelsalesintheUnitedStatesforCamilleBeckhamfor2012total$10million,
evenwith2011salesduetothelackofnewproductlaunches.
CARGOCOSMETICS
BasedinToronto,Canada,CargoCosmeticsisaCanadiancosmeticscompanythatwasfounded
in 1996 by Hana Zalzal. The companys line of cosmetics was developed by top professional
artists. In 1998, Cargo Cosmetics was introduced in the United States and is now available
worldwide.Cargoproductsaresoldinmorethan1,400storesacross11countries.
Cargos product offerings include makeup products comprising face makeup, eye makeup,
lipsticksandlipglossesaswellasmakeupbrushes(notincludedinthisstudy).
CargoCosmeticsisaprofessionalbrandandpopularwithsomeHollywoodcelebrities.Sincethe
company works so closely with the professional makeup artist community, the company has
startedaspecialProArtistProgramwherebymembersareentitledtoreceivea40%discount
onCargoproductspurchaseddirectlyfromtheCargoCosmeticswebsite.
New products introductions in 2012 include the Cargo Lip Gloss moisturizing, highshine,
longwearinglipglossthatisavailablein14shades;andCargoColorstickoilfree,creamcolor
stickthatblendswitheyes,cheeks,andlipstogiveanaturallookandisavailableinfiveshades.
Furthermorein2012,thecompanylaunchestheSpringKitcomprisinglipglossinFresno,Beach
BlushCoralBeach,EyeShadowDuo,TripleActionMascara,andaSpringMakeupbag.
4A20
MinorCompanies
CargoCosmeticsissoldthroughouttheUnitedStatesatmajorretailersincludingSephorainside
JCPenny department stores, Ulta, QVC, and Macy's Impulse Beauty. The company does not
advertiseitsproductsdirectlybutthroughPRarticlesinleadingfashionandbeautymagazines
includingFlareandEssence.Thecompanyscosmeticsareusedbymakeupartistsonanumber
of popular television shows, such as AmericanIdol and The Big Bang Theory, and in movies,
suchasAliceinWonderland,IronMan2,andInsidious.Thecompanyhasavoidedtraditional
advertising and instead appointed celebrities including Denise Richards and Courtney Cox to
designlipsticksandengageinsocialmediacampaigns.CargoCosmeticshasnoTMEin2012.
In 2012, TPR Holdings purchases a controlling interest in Cargo Cosmetics. TPR Holdings is a
NYCbasedinvestorandoperatorofbeautyandconsumergoods.HanaZalzalwillcontinueto
remainwithCargoCosmeticsasthecreativedirector.
Cargo Cosmetics sales of cosmetics and toiletries in the United States are estimated at
CARMALABORATORIES
Carma Laboratories is a private company headquartered in Franklin, WI. It was founded by

Alfred Woelbing in 1937 and has a total of 100 employees as of 2012. Carma Laboratories
competesintheU.Scosmeticsandtoiletriesindustryundertheoralcareandskincareproduct
classes.Itenteredtheskincareproductclassintheyear2010byintroducingCarmexHealing
CreamandCarmexHydratingLotion.
The new products introduced during 2012 include the Carmex Pomegranate Ultra Smooth lip
balminfusedwithninemoisturizers;andCarmexlipconditioner,anaturalorangeflavorinfused
with13moisturizerstokeeplipshydrated.Thecompanysproductsareretailedthroughmany
stores,includingAlbertsons,CVS,DuaneReade,DollarGeneral,FamilyDollar,FredMeyer,HE
B, Kmart, Kroger, Rite Aid, Safeway, Sams Club, Walmart, Walgreens, Target, and Pathmark.
Advertisingisalsoanintegralpartofthecompanysagenda.Thecompanykeepsitscustomers
informedaboutitsproductsthroughtelevision,magazines,andspecialevents.
Carma Laboratories spends an estimated $7.3 million as TME in 2012. The company offers
couponsandalsopromotesitsproductsthroughsocialwebsiteslikeFacebookandTwitter.
CarmaLaboratoriesU.Scosmeticsandtoiletriessalesareflatat$33millionin2012,sameas
2011levels.
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CAROLSDAUGHTER
Carols Daughter is a line of natural beauty products which was designed by Lisa Price. The
company was founded in 1993 and is headquartered in Brooklyn, NY. It employs about 50
peopleasof2012.InvestorsofthecompanyincludepeoplelikeWillSmith,JadaPinkett,JayZ,
MaryJBlige,JimmyLovine,TommyMottola,andThalia.
The companys personal care products portfolio comprises hair care products, skin care,
personalcleansing,andfragrancestargetingAfricanAmericans.
In2012,thecompanyintroducesnewproductswhichincludeAaiClarifyingExfoliatingToner,
Aai Hydrating Foam Cleanser, Aai Hydrating Exfoliating Toner under the skin care product
class,andHairMilk4PieceStarterKitandTransitioning123underthehaircareproductclass.
The products of the company are retailed through nine of its own stores, as well as various
salonsandotherretailers,suchasSephoraandMacys.Productsarealsosoldonlineandthe
company offers complimentary shipping on any order. Carols Daughter allocates a TME of
$902,700in2012.
ManufacturerssalesofcosmeticsandtoiletriesforthecompanyintheUnitedStatesin2012
and2011areconstantat$23million.
CARTIER
Cartier was founded in 1847 by Louis Francois Cartier and is headquartered in Paris, France.
CartierisownedbytheVendomeGroup,asubsidiaryoftheSwissgroup,CompagnieFinanciere
Richemont. The company has a worldwide presence with products being retailed across all
continentsanditsotherbrandsincludePiaget,IWC,AlfredDunhill,andVanCleef&Arpels.The
headquartersofCartierNorthAmericaareinNewYork,NY.
Cartier manufactures jewelry, watches, leather goods, apparel, accessories, hand and body
lotions,personalcleansingproducts,shavingproducts,andfragrancesandancillariesformen
and women. The company also offers pens, lighters, scarves, eyewear, decorative pieces,
clocks,cufflinks,andbirthdaygifts.Themajorityofthecompanyssalesaregeneratedfromits
jewelryandwatchesbusiness.
4A22
MinorCompanies
In 2012, Cartier revamps its classic Dclaration to introduce Dclaration d'un Soir a new
fragranceformenwhichreprisesthecoldspicesoftheoriginalfragranceandlaunchestheEau
de Cartier Essence de Bois a fresh woody fragrance with oud wood with additional notes of
yuzu,bergamot,violetleaves,violetflower,lavender,musk,patchouli,andambergris.
In 2011, Cartier expanded its worldwide network of boutiques and specialized retailers. The
companys products are distributed through a network of approximately 300 boutiques. In
2011, boutiques were upgraded with the closure of selected boutiques and the opening of
better and larger flagship retail stores. Cartier products are retailed at stores including
Nordstrom,Sephora,Macys,andSaksFifthAvenue
Macys offers a variety of bonus offers to consumers on Cartiers fragrances for men and
women,handandbodylotions,andpersonalcleansingproducts,suchasacomplimentaryfive
piece gift set on the purchase of Cartiers Dclaration d'un Soir, free gift with purchase on
Cartiers Declaration Toning Bath & Shower Gel, and free gift with purchase of a Cartier
Declaration After Shave Lotion. Cartier spends under $100,000 in TME in 2012, 67% on
magazine advertising for its womens fragrance Baiser Vole, and the remainder on magazine
advertisingforitsmensfragranceDclaration.
Cartiers sales of cosmetics and toiletries in the United States are estimated at $13million in
2012,up8.3%from$12millionin2011.
CCAINDUSTRIES
CCAIndustries,foundedin1983,isheadquarteredinEastRutherford,NJ.Itisapubliclytraded
companyandmarketspersonalcareandhealthproductsundervariousbrandnames,primarily
in the United States and Canada. The products are manufactured by contract manufacturers
andaremarketedunderlicenseagreements.Itemploysaround140employeesasofOctober
2012.
CCA Industries brands comprise Plus+White toothpastes and teeth whitening kits, Sudden
Change range of antiaging skin care products, Nutra Nail manicure products, Bikini Zone
depilatoryandafterhairremovalproducts,GelPerfect5Minutecolorgel,SolarSensesuncare
products, vanillabased fragrances called Cherry Vanilla, Hair Off depilatories, Wash N Curl
shampoos, Scar Zone scar management, and firstaid products, IPR3 products for foot care,
andmensaftershaveproductcalledShaveZone.
The company sells and markets its products through warehouse clubs, drug stores, mass
merchandisers,foodstoresaswellasthroughonlineportals.Someoftheretailstoresthrough
whichthecompanysellsitsproductsareA&P,Albertsons,CVSPharmacy,DiscountDrugmart,
Duane Reade, Food City, Food Lion, Publix, Rite Aid, Safeway, Shop Rite, SuperValu, Target,
Ulta,Walgreens,andWalmart.Amazon.com,drugStore.com,andWalgreens.comaresomeof
the online portals for shopping CCAs products alongwith the companys own online portal,
shop.CCAIndustries.com. CCA creates and/or oversees formulations with independent
contractorsformanufacturingitsproductsbasedoncompanyspecifications.
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ThecompanylaunchesNutraNailGelPerfect,Plus+White5MinutePremierWhiteningSystem,
Plus+WhiteSuperWhitetoothpaste,SuddenEyeUnderEyetreatment,EyeBoutiqueShadow
Shields,andCherryVanillaBodyMistin2012.Itpromotesthroughsocialmediawebsiteslike
FacebookandTwitter.TMEforCCAIndustriesproductsareestimatedat$1.8millionin2012.
JonathanRothschildisappointedasadirectoronAugust16,2012,replacingJamesMastrian,
whoresignedasthedirectorofthecompanyasofAugust15,2012.
CCAIndustriescorporaterevenuesareestimatedatapproximately$50millionin2011,down
2.0% from $51million in 2010. The companys cosmetics and toiletries sales in the United
Statesincreaseby6.3%from$16millionin2011to$17millionin2012,basedonnewproduct
activities.
CELLEXCINTERNATIONAL
CellexC International is a privatelyowned Canadian company headquartered in Toronto,

Canada,foundedin1990.Itisamanufacturer,distributor,andretailerofcosmeticformulations
containingvitaminC.ThecompanyhasaningredientCellexCComplex,withpatentedformulae
used widely in its products. The companys product lines include, sun care, antiaging, and
productsformotherandchild.Thecompanyemploysabout50staffmembersasof2012.
Thecompanyoffersawiderangeoffacialtreatmentsandsuncareproducts.Someofthefacial
treatment products include cleansers (foaming gels, creams, and cleansing milk); antiaging
products(oilfreemoisturizers,skintighteningcream,eyecontours,serums,andskinhydration
complexes); exfoliators and masks (skin toning masks and clear complexion masks). The sun
careproductsmarketedbythecompanyincludesuncareSPF30+,sunscreenlotions,andUV
moisturizers.
The companys products are sold in about 40 countries. In the United States, CellexC
International sells its products through distributors, dermatologists, and aestheticians. The
company further markets its products through the Internet, pharmacies, and some specialty
stores,suchasSephora.
In2012,thecompanyscosmeticsandtoiletriessalesatthemanufacturerslevelintheUnited
Statesareat$18million,unvaryingfrom2011sales.NoTMEforCellexCsbrandsareevident
in2012.
4A24
MinorCompanies
CHRYSALLIS
Chrysallis is a management group with a mission of driving growth and development of fast
movingbrandsinthehealthandbeautyindustry.Itsparentcompany,CattertonPartners,isa
privateequityfundmanagingmorethan$2billiondollars,withfocusexclusivelyonconsumer
products.ThecompanyisheadquarteredinNewYork.
SomeofthebrandsdevelopedbythecompanyincludeFrdricFekkai(soldin2008),Niadyne
Nia24,andtheCanyonRanchYourTransformationskincarecollection.Someofthepersonal
careproductscurrentlymarketedbyChrysallisareStriVectinandNia24.StriVectinwasbought
by Chrysallis in 2009, and although positioned as a clinical brand, it is sold across multiple
channelswithretailersincludingCostco,Ulta,andBeauty360.CattertonPartners,alongwith
Chrysallis,nowoverseethedaytodaymanagementofthePoutCosmeticsbusinessaswell.
ManufacturerssalesintheU.S.cosmeticsandtoiletriesmarketforChrysallisareestimatedat
$43millionin2012,sameasin2011.ChrysallishasnegligibleTMErecordedin2012.
THECOLOMERGROUP
ColomerUSAisheadquarteredinJacksonville,FL.ItisasubsidiaryoftheSpanishcompany,The
ColomerGroup.ThecompanywasfoundedbyJoseColomerin1923.Asof2012,thecompany
employsapproximately950people.TheColomerGroupsparentCVCCapitalPartnershasthe
company(ColomerGroup)upforsalesince2011,andCVCCapitalPartnersintendstosellits
haircareandskincarebrands.
Thecompanysproductofferingsincludeshampoos,conditioners,gels,lotions,hotfills,perms,
relaxers, masks, scrubs, nail care, bath salts and crystals, treatment skin care, and nail care
products.ThecompanymanufacturesproductsinSpain,Italy,Mexico,andtheUnitedStates(in
Florida).Itproducesavarietyofhaircareformulasspecializinginethnicconcerns,fromcolorto
stylingandtreatmentproducts,andmarketedtoAfricanAmericanandHispanicconsumers.
ThebrandsmarketedbythecompanyincludeRouxhaircareproducts,AmericanCrewmens
skinandhaircareproducts,andCrmeofNaturemulticulturalhaircareproducts.Professional
brands marketed by the company are D Fi, Creative Nail Design (CND), and Equave. The
companyprimarilysellsitsproductsthroughprofessionalchannelsincludingsalonsandbeauty
supply stores, and the professionaluse sales are not included in the scope of this report.
Colomers ethnic products are also distributed through mass outlets. The success of CND
Shellachasbroughtabroughtalotofimitationsintothenailcarecategory.
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MinorCompanies
CrmeofNaturewithArganOilTreatmentisinfusedwithArganOil,andtheproductclaims
torepairdry,damagedhair,strengthenandpreventhairbreakage.
Moisture&ShineShampoo,infusedwithArganOilfromMorocco,helpshairtodetangle,
soften,andboostshine.
IntensiveConditioningTreatmentclaimstoleavehairsoft,silky,andrestoreshine.
Strength & Shine LeaveIn Conditioner infused with Argan Oil from Morocco, claims to
revitalizechemicallytreatedhairfrominsideout.
The Colomer Groups global sales are estimated at $435 million in 2012. The companys U.S.
salesoftakehomeproductsareestimatedat$42millionin2012,upfrom$41millionin2011.
The Colomer Group supports its brands with TME of $2.2 million in 2012. The company
allocates its TME majorly on two categories; nail care and hair care. The nail care category
receives$1.0millionTMEandhaircarecategoryreceives$1.2millionTMEin2012.
CORSILVERSKINCARE
CorSilverSkincarewasfoundedin2008byJenniferMcKinley.McKinleysfascinationwiththe
patentedformulaofnanosilverwithsilicaledtotheformationofthecompany.Thesilverin
Corproductsstopsthebacteriafromtransferringoxygenthroughthecellwallswhilethesilica
helpstheskinabsorbtheingredientsofCor.Corwasthereforelaunchedinpartnershipwitha
scientistinKorea.Corproductsarecomposedofpatentedsilversilicacompound,knownforits
antibacterialproperties,tohelpclearskin,andasanantiagingagent.Corsproductofferings
can be classified under personal cleansing products, hand and body lotions, and facial
treatments.
In2012,thecompanylaunchestheCorSilverCalmingMask,whichusesthehealingproperties
ofBentoniteClay,colloidaloatmeal,seawhipfromcoral,andpurealoefordetoxificationand
purification of the skin; Cor Silver Enzyme Maskformulated with papaya, antioxidants,
vitamins,flavonoids,andcaroteneshelpsremovedeadskincellsandgiveamoreglowingand
youthful skin; and Cor Silver Hydrating Mask formulated with ricefermented sake, black tea,
oats, wheat amino acids, and pink grapefruit for a smooth and luminous skin with skin
lighteningproperties.
CorproductsareusedbymanycelebritiesincludingRashidaJones,JenniferGarner,TyraBanks,
andChristinaHendricks.Thecompanyfeaturesinmagazinesincluding Esquire,WWDBeauty,
Essence, Bazaar, Glamour, and Health Beauty Life. The companys website features a 20%
discount on all Cor products. Social media networking sites, such as Facebook, Twitter, and
PinterestarealsoimportantpromotionalmediaforCor.Thecompanydoesnotapportionany
significantamountofTMEin2012.
4A26
MinorCompanies
Corisretailedthroughspasandsalons,retailersFredSegal,BeautyCollection,GoddessWithin,
IllusionsofBeauty,Palmetto,andPowderRoom.Thecompanysproductsarealsoavailablefor
purchaseonthecompanyswebsiteandskinstore.com.
In 2012, sales of Cor Silver Skincare in the U.S. cosmetics and toiletries market at the
manufacturerslevelareestimatedat$5millionin2012,constantfromsalesin2011.
COSRICHGROUP
Cosrich Group is a subsidiary of the international firm PMC Group, which manufactures and
distributes children's bath products including shampoos, conditioners, cleansers, and bath
bubbles. The company also markets play cosmetics. Cosrich Group is a private company with
headquartersinBloomfield,NJ.Thereareatotalofover50employeesinthecompany.
Cosrich Group markets its products through its MeToo brand. The company owns licenses of
publishers, such as Hasbro and DC comics and some toy manufacturers. The companys
products feature characters including Batman, Superman, Hello Kitty, My Little Pony,
StrawberryShortcake,andBobtheBuilder,amongothers.
Thecompanysdistributesitsproductsnationwide,throughsupermarketsandspecialtystores
andalsothroughmassmerchandisingstoreslikeKmart,Target,ToysRUs,andWalmart.The
U.S. manufacturers level sales for the company are estimated at $6million in 2012, up from
$5millionin2011.NoTMEforCosrichGroupsbrandsareevidentin2012.
DANACLASSICFRAGRANCES
DanaClassicFragranceswasestablishedinSpainin1932.HeadquarteredinDeerfieldBeach,FL,
the company employs about 330 people. The company offers a wide range of mens and
women's fragrances for all types of consumers. Dana Classic Fragrances manufactures and
distributes over 50 classic brands, among which the classic 1970s womens scents include
Love's Baby Soft, Navy, Toujours Moi, Tabu, and Chantilly. Aside from the classic fragrance
brands, others marketed by the company include Black Lace, British Sterling, California For
Men,CaliforniaForWomen,Canoe,Chantilly,EnglishLeather,EnglishLeatherBlack,Forbidden,
HeavenSent,LovesBerrySweet,LovesSugarKiss,NavyForMen,NavyForWomen,andNo
Limit.DanaClassicFragrancesintroduces20Caratsfragrancein2012.
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Dana Classic Fragrances is owned by Patriarch Partners, a private equity firm whose founder
and CEO is Lynn Tilton. With a specialty in turning around ailing U.S. companies, Patriarch
Partners has majority holdings in over 40 companies in diverse industries: aerospace,
automotive,engineering,andtechnologyaswellasconsumerproducts.Itsothercosmeticsand
toiletriesbrandsareStilaCosmeticsandJaneCosmetics.
Thecompanysellsitsproductsonlineandthroughmajordrugstoresandmassmarketretailers,
such as Walmart, CVS,Rite Aid,and Longs Drugs. The companys products are also marketed
throughvariousdepartmentstores,suchasSears.
TheU.S.manufacturerslevelsalesofcosmeticsandtoiletriesforDanaClassicFragrancesare
estimatedat$12millionin2012,downfrom$14millionin2011.Thecompanyhasnegligible
TMErecordedin2012.
DEADSEALABORATORIES
DeadSeaLaboratoriesisaprivatecompanyfoundedbyZivaGiladin1988andisheadquartered
in Holon, Israel. The company manufactures and distributes skin care products made of mud
andmineralbasedcompoundsfromtheDeadSea.Thecompanysmainmanufacturingplantis
basedoutofMitzpeShalem,onthewestbankofPalestine.Thecompanyemploysabout200
peopleandsellsitsproductsinover30countriesworldwide.
ThecompanymarketstheAhavabrandofskincareproductsincludinghandcream,footcream,
facial cleanser, body milk, facial nourishing cream, facial moisturizer, and face makeup,
moisturizingshowercreamandbodycream.Italsohasasmallrangeofmakeupproducts.
In2011,ElanaDrellSzyfer,formerSeniorVicePresidentofGlobalMarketingforEsteLauder,
wasappointedgeneralmanagerofAhavaNorthAmerica.
HopeBlossomsBathSaltclaimstocontain100%naturalDeadSeasaltcrystalswithhealthy
minerals.Itclaimstorelaxmusclesandjointsandleavestheskinfeelingsoft,smooth,and
refreshinglyhydrated.
ComfortingCreamprovidestotalrelieffromsensitiveskinandcanbeusedeverydayorfor
occasionalflareups.
FirmingBodyCream:Thissilky,nourishingbodycreamhelpsskinrecoverlostfirmnessand
supportssaggingwhileimprovingtoneandelasticity.
Extreme Firming Eye Cream claims to reduce wrinkles, enhance firmness, and provide
protectionandintensemoisturetothefragileskinaroundtheeyeareaforamoreyouthful,
wellrestedappearance.
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Avahas products are distributed in more than 30 countries through department stores,
perfumeries, and chain outlets. The company also has flagship stores in Israel, Germany,
Hungary, the Philippines, and Singapore. In the United States, Avahas products are retailed
through stores like Nordstrom, Bloomingdales, and Lord & Taylor. It also has an online
shopping portal which contributes to a large part of the sales in the company. The company
promotesitsproductsthroughmagazines,suchasNewBeauty,NaturalHealth,andSheen.
Mostofthecompanysrevenueisdrivenfromexportsandtheglobalsalesofthecompanyare
estimated at approximately $160 million in 2012. The U.S. manufacturers sales total
approximately $24 million in 2012, up from $22 million in 2011. No TME for Dead Sea
Laboratoriesbrandsareevidentin2012.
DEBORAHLIPPMANN
DeborahLippmannisarenownedmanicuristandaninnovativeentrepreneurwhocreatedher
nailbrand,DeborahLippmann.BasedinNewYork,NY,thecompanywasestablishedin1999.
Her nail collection features over 45 longwearing nail lacquers and a few nail, hand, and feet
treatments. Deborah Lippmann's nail polishes have been worn by some Hollywood stars like
Kate Winslet, Resse Witherspoon, Renee Zellweger, and Penelope Cruz. Passion for nail art
enablestheentrepreneurtobuildherclientele.
In 2012, Deborah Lippmann launches colors with names, such as Candy Shop, Mermaids
Dream, Steal My Kisses, Swagga Like Us, Sugar Daddy, Private Dancer, Rock This Town, Shes
AlwaysaWomen,PuttinontheRitz,andBadThings.Theyear2012alsomarksthelaunchof
Lip and Nail Duets of Love Notes and My Touch My Kiss. Deborah Lippmanns hand and foot
treatments include Rich Girl hand cream, Get Off callus softener, Soul Mission foot scrub,
CuticleRemover,andCuticleOil.
DeborahLippmannsproductsarepromotedonsocialnetworksiteslikeFacebook,Twitter,and
YouTube,andthroughonlineblogs.Productsareavailableathighenddepartmentstores,such
asNeimanMarcus,Nordstrom,BarneysNewYork,Lord&Taylor,andBloomingdale's.TheU.S.
manufacturers sales of the company are estimated at $3 million in 2012, up by 50% from
$2millionin2011.
DEMETERFRAGRANCELIBRARY
DemeterFragranceLibraryisheadquarteredinGreatNeck,NY,andwasincorporatedbyJohn
Demeter.Establishedin2002,thecompanyemploysabout25peopleasof2012.Itmarketsa
totalofabout250productSKUsunderdifferentproducttypes,suchascolognesprays,shower
gels,bathandbodyproducts,bodylotions,andbodysplashes,positionedasnatural.
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All Demeter Fragrance Library products are either made entirely by hand, or semi
automatically,insmallbatches.Thecompanyclaimsnottoaddoruseanyartificialcolors,and
itsfragrancesarecompletelynatural.AlthoughDemeterFragraceLibraryClassicfragrancesare
all natural, the company does use some synthetic ingredients in some fragrances. The
ingredientsinthefragrancesareatleast95%derivedfromnaturalandsustainablesources,and
usenoartificialcolororPhthalatesorparabens.
DemeterFragranceLibraryfragrancesincludeVanillaCakeBatter,PureSoap,Dirt,GreenTea,
and Rain. Some of the most popular fragrances of Demeter Fragrance Library include Snow,
Grass,andWetGarden.
The company sells its products through various retail stores like Walgreens, Exit 9, Dollys
Vintage, and Rickys Sobe. Demeter Fragrance Library promotes its products through various
socialnetworkingsiteslikeFacebookandTwitter.NoTMEforthecompanyhavebeenreported
in2012.
DemeterFragranceLibraryssalesintheU.S.marketforcosmeticsandtoiletriesareestimated
at$9millionin2012,fixedat2011levels.
DERMALOGICA
Dermalogica is a privatelyheld company, which was founded by Jane Wurwand in 1986. It is

headquarteredinCarson,CA,andhasaworkforceofapproximately1,000people,ofwhich700
are located in the United States. The companys products, all manufactured in the United
States, are distributed in over 60 countries, including the United Kingdom, Ireland, Germany,
andCanada.Dermalogicahasapproximately120skincareproducts,thebulkofwhicharefor
takehomeinsteadofprofessionaluse.Therangeincludesavarietyoffacecare,bodycare,and
suncareproducts,amongothers.Thebrandalsooffersmalegroomingproducts,severalhair
careproducts,andamakeupfoundation.
Dermalogicas skin care range is segmented into a variety of product lines designed to treat
specificskinconditionsandincludescleansers,toners,exfoliants,andcreams,aswellasmore
specializedproducts,suchasacneandundereyetreatment.TheseincludeAgeSmarttotreat
aging signs, Chromawhite to treat hyperpigmentation, Ultracalming to treat hypersensitivity,
and Medibac to treat acne. Each line also has its own product kits. The product range also
includesaseriesofboosterswhich,whenappliedbeforeapplyinganotherDermalogicaproduct
ontheskin,providesanadditionalbenefitontheskin.ThefourboostersareGentleSoothing
Booster, Skin Hydrating Booster, Extra Firming Booster, and Skin Renewal Booster. The
companyalsooffersseveralhaircareproductsandamakeupfoundation.
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Dermalogicasproductsaresoldonline,inUltaandBluemercury,andthroughmanysalonsand
spas. It generates approximately 75% of its sales through the spas and salons channel. The
brandhasapproximately5,000activeaccountsamongwhichmostaredayspas,fulltimehair
salons,andnailsalons.Itsproductsarefoundinapproximately1,500retailoutlets,themajority
of which also offer treatment services. Growth is driven mainly by popular promotions,
especiallywithnewproductkits,andthegoodperformanceofsomeofitsretailpartners,such
asUltaandBluemercury.Thecompanyprovidessamplesofhaircare,makeup,skincareand
fragranceproductspairedwithanexclusiveissueofAlluremagazine.
Thecompanylaunchesavarietyofnewproductsin2012,someofitskeylaunchesinclude:
AgeSmartSkinPerfectPrimerSPF30claimstosmoothenfinelines,brighten,andprimefor
flawlessskin.
Solar Defense Booster SPF 50 is said to be formulated without artificial fragrances and
colors.
Exfoliating Body Scrub contains papaya enzymes, skinsoftening rice bran, and pulverized
olive,figanddateseedstosmoothenroughspots.
ConcealingSpotTreatment,atintedspottreatmentthathelpsconcealandclearbreakouts
uponcontact.
Global sales of the company are estimated at $130 million in 2012. The U.S. manufacturers
levelsalesofcosmeticsandtoiletriesforthecompanyareestimatedat$53millionin2012,up
3.8%from$51millionin2011.DermalogicahasnegligibleTMErecordedin2012.
DERMOVIVASKINESSENTIALS
DermovivaSkinEssentialswasestablishedin2005andisasubsidiaryofDaburIndia.In2010,
the company acquired Namaste Laboratories and its three subsidiary companiesHair
Rejuvenation & Revitalization Nigeria, Healing Hair Laboratories International, and Urban
LaboratoriesInternationalfor$100million.NamasteLaboratoriesisaleadingethnichaircare
productscompanybasednearChicago,ILwithoperationsinNorthAmerica,Europe,theMiddle
East, and Africa. It claims to offer holistic remedies that condition and renew hair, skin, and
body.
Through Namaste Laboratories, the company markets products targeted at healthconscious

multiculturalconsumers.Itsportfoliooffershaircare,skincare,andothertoiletriesproducts.
ItsmostpopularlineisnaturalhaircareproductswiththebrandnameOrganicRootStimulator.
Productsaredirectedattreatinghairconcerns,suchashairloss,thinningofhair,damagedhair,
anddryanditchyscalp.OrganicRootStimulatoruseshairstrengtheningagentsfoundinplants
to formulate its products. The brands hair care product formulations contain beta carotene,
vitaminE,horsetail,andaminoacidstoaddstrengthtofragileanddamagedhair.Dermoviva
SkinEssentialsalsomarketssoapsthataddressspecificconcernsoftheconsumers.Antiaging
soaps,moisturizingsoaps,andfairnesssoapsaresomeofitsproducts.
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The company promotes its brands on its website, online blogs, social networking sites like
FacebookandYouTube,andbyprovidingdiscountcoupons.IntheUnitedStates,productsare
availableat8,000storesincludingmassmerchandiserslikeWalmart,Target,andKmart,drug
stores such as Walgreens and CVS, and other food and health stores. The products are also
retailedthroughindependentbeautyandbarbersupplyretailers.
The U.S. manufacturers sales of Dermoviva Skin Essentials for the years 2012 and 2011 are
estimatedat$9million.
DEVACURL
DevaCurl is a privatelyheld company founded in 2001 by Lorraine Massey. It has a complete

collectionofproductsforacurlylifestyle.Theproductsusehealthyoilsandbotanicalextracts,
suchasoliveoil,lavenderextracts,andwheatproteintocleanse,hydrate,andlockinmoisture
incurlyhair.
DevaCurls product portfolio consists of hair care brands to cleanse, hydrate, and style curly
hair.BrandsforcleansingandhydratingincludeDevaCurlLowPoo,DevaCurlNoPoo,DevaCare
LowPoo, DevaCare NoPoo, DevaCurl One Condition, and DevaCare One Condition. Styling
brands include DevaCurl Light Defining Gel, DevaCurl Set It Free, DevaCurl Styling Cream,
DevaCurl Spray Gel, DevaCurl Mister Right, DevaCurl SetUp & Above, and DevaCurl
MirrorCurls.
DevaCurlsbrandsarealsopromotedonsocialnetworksiteslikeFacebook,Pinterest,Twitter,
and YouTube. In the United States, products are available in specialty stores like Ulta and in
variousbeautysupplystores,salons,andspas.
DomesticsalesofDevacurlareestimatedatunder$1millionin2012,thesameas2011levels.
DR.BRONNERSMAGICALLONE
Dr. Bronner's Magic AllOne was established in 1948 by Emanuel Bronner. The company is
headquarteredinEscondido,CA,andisamanufacturerandmarketerofnaturalpersonalcare
products.Themarketerhasabout40employeesintheUnitedStates.Thecompanyclaimsthat
its range of personal care products is of the highest quality and conform to the standards of
environmentalawarenessandsocialresponsibility.Thecompanysclassicliquidsoapsandbar
soaps are certified organic under the United States Department of Agricultures (USDA)
NationalProgram.
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Some of its products include classic liquid and bar soaps, organic hand and body soaps, hair
conditioning rinse and crme, organic lip balms, organic body balms, organic lotions, organic
shaving gels, and organic hand sanitizers. Dr. Bronner's Magic AllOne products are mainly
distributedthroughmassmerchandisersandnaturalfoodstores.Theproductsareavailableat
Walmart, Whole Foods, Target, Walgreens, Rite Aid, and Longs Drugs. The online shopping
portalisanotherwayofsellingthecompanysproductsthroughitsownwebsite.
The company promotes its products through Facebook and Twitter and also offers 15%
discountonselectedproducts.ThecompanydoesnotallocateanyevidentamountofTMEin
2012.Dr.BronnersU.S.salesatthemanufacturerslevelare$20millionin2012,up5.3%from
$19millionin2011,drivenbypromotionalactivitieslikediscountsofferdbythecompany.
DR.FRESH
Establishedin1998,Dr.FreshisheadquarteredinLosAngeles,CA.Ithasdistributionfacilitiesin
about 35 countries worldwide with major locations in the United Kingdom and China. As of
2012,thecompanyemploysatotalof93peopleworldwideandoffersover250personalcare
products.Dr.FreshhasmanufacturingfacilitiesintheUnitedStates,China,andIndia.
The companys products are designed for both children and adults, and are sold under the
brandnamesofDr.FreshDailies,Dr.FreshTravelKits,Binaca,Firefly,Dr.Kens,andTek.The
companyalsoownslicensesofCloseUp,Peanuts,Marvel,Barbie,HotWheels,andHelloKitty.
Dr. Freshs product offerings include toothbrushes, travel kit dental floss, and denture care
products.
In April 2012, Dr. Fresh enteres into a new licensing agreement as the exclusive U.S.
manufacturerandmarketerofAngryBirds,abrandedoralcareproduct.InDecember2012,Dr.
FreshacquirestheReachbrandoftoothbrushesfromJohnson&Johnson.
The companys products are available at most mass merchandizing stores like CVS, Kmart,
Kroger, Safeway, Target, and Walmart. Products are also sold through food stores and drug
stores. Dr. Freshs new product activity is promoted through social networking sites like
YouTube.In2012,thereisnoevidentallocationofTMEforDr.Freshsproducts.
Dr.FreshssalesofcosmeticsandtoiletriesintheUnitedStatesareestimatedat$58millionin
2012, up 1.8% from $57 million in 2010 and 2011 (both years figures include the Reach
toothbrushessales).
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DR.HAUSCHKASKINCARE
Establishedin1967andheadquarteredinEckwalden,Germany,Dr.HauschkaSkinCarehasa
rangeofprofessionallypositionednaturalskincare,haircare,bodycare,andmakeupproducts.
Itsproductsareproduced,manufactured,andmarketedbyWALAHeilmittelGmbH,aprivately
heldGermanhomeopathicpharmaceuticalscompany.
Dr.HauschkaSkinCareproductsaredevelopedusingnatural,ecological,certifiedorganic,and
sciencebased ingredients. Dr. Hauschka Skin Cares product range comprises 150 SKUs,
developed to treat skin conditions, such as mature skin, sensitive skin, normal, oily, a
combination of oily and normal, and dry skin. Dr. Hauschka also provides skin consultation
servicesandoffersitsproductsonline.
IntheUnitedStates,Dr.HauschkaSkinCareproductsareavailableinsalons,spas,naturalfood
stores,supermarkets,andhealthfoodstores.Someofthemainretaildestinationstobuythe
companys products are Whole Foods, Westerly Natural Market, Steven Alan, C.O. Bigelow,
PugetConsumerCoOp,andAnthropologie.
The company offers 20% discount on some introdcutory and travel kits. The company also
offers free shipping on any order exceeding $50.00. It also conducts its promotional and
marketing activities through social websites like YouTube, Twitter, and Facebook. Consumers
can also view skin care and makeup tips on YouTube. Dr. Hauschka Skin Care apportions a
minisculeamountofTMEin2012.Itspendslessthan$3,000onlocalmagazineadvertising.
The U.S. sales of Dr. Hauschka Skin Care cosmetics and toiletries in 2012 are estimated at
$24million,up4.3%from$23millionin2011.
E.L.F.COSMETICS
E.L.F. Cosmetics (Eyes Lips Face) was launched in 2004 by Joey Shamah and ScottVincent
Borba.The companyisbasedinNewYork,NY andmarketsanddistributesitsproductsin16
countries outside the United States, including the United Kingdom, Germany, Columbia,
Australia,SaudiArabia,CzechRepublic,Bahrain,Spain,andFrance.E.L.F.Cosmeticsoffersaline
ofprofessionalmakeuptoolsandmakeupproducts.
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MinorCompanies
Thecompanymarkets67SKUsofmakeupproductsandskincareproducts,suchasfoundation,
concealer, bronzer, powder, blush, shimmer, tinted moisturizer, cleanser, moisturizer, eye
shadow,eyeliner,mascara,primers,lipsticks,lipgloss,lipliners,andnailpolish.SomeofE.L.F.
CosmeticsproductsincludeFlawlessFinishFoundation,TranslucentMatifyingPowder,Tinted
Moisturizer SPF 20, Baked Bronzer, Matte Eyeshadow, Kohl Eyeliner, Mascara Primer, High
Definition Undereye Setting Powder, Luscious Liquid Lipstick, Shimmer Lip Gloss, and Matte
Finisher Clear Nail Polish. In 2012, the company launches LongLasting Lustrous Eyeshadow,
Jumbo Lip Gloss Stick, Jumbo Eyeshadow Stick, Daily Moisture Stick, Contouring Blush &
BronzingCream,HDBlush(fivecolors),BakedEyeshadow,MaximumCoverageConcealerOil
Free, Pressed Mineral Eyeshadow, Baked Blush, Baked Bronzer, Defining Mascara, Lip
Exfoliator,andVolumizingMascara.
Brands are promoted extensively on social network sites like Facebook, Pinterest, YouTube,
Twitter, and Google+ and by providing educational videos to its consumers. E.L.F. Cosmetics
productsareavailableatmassmerchandisestoreslikeWalmart,Target,andKmart;drugstores
like CVS, Rite Aid, and Walgreens; grocery stores such as H.E.B.; and online retailers like
amazon.com,dermstore.com,drugstore.com,andeyeslipsface.com.
Thisprivatelyheldcompanyhasastaffofaround30people.Corporatesalesofthecompany
areintherangeof$75millionand$85million.In2012,theU.S.manufacturerssalesofE.L.F.
Cosmeticsareestimatedtogrowby33.3%to$32millionfrom$24millionin2011.Salesgrowth
is supported by increased distribution channels and by the introduction of various new
products.
EQUITIUMGROUP
TheEquitiumGroupisaMiamibasedinvestmentfirmfocusedontheluxury,fashion,beauty,
health, and personal care industries. In 2007, the company acquired CaswellMassey, the
Edison,NewJerseybasedpurveyorofluxurypersonalgroomingproducts.CaswellMasseywas
foundedin1752inNewport,RIasDr.HuntersDispensary.Thecompanyproduceshighquality
groomingproductsincludingsoaps,lotions,fragrances,andotherpersonalcareitems.
CaswellMasseys product offerings include approximately 1,100 SKUs comprising bath and
body products, fragrances, facial treatments, and other toiletries. CaswellMasseys range of
brandsincludeDr.HuntersOriginalRemedies,Patyka,LuckyTiger,ClausPorto,ColonelConk,
Dr.Sharp,GiannaRose,IreneHirose,Me!Bath,MusgoReal,Roger&Gallet,andNaturopathica.
In 2011, Lorell Marketing Group collaborated with CaswellMassey to release the companys
first directtoconsumer catalog for the Gianna Rose brand, a luxury collection of beautifully
moldedbarsoapsandbathaccessories.ThecataloghelpedexpandtheGiannaRoseaudience,
increaseproductawareness,andhelpconsumersdiscovernewproducts.In2011,thecompany
also partnered with the Google catalog application for the iPad. The application allows users
access to a diverse group of catalogs, makeawish list or collage of favorite products, post
itemsonFacebookoremailtofriendsandfamily,andviewbehindthescenesphotoshoots,
videos,andtutorials.
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In 2012, the company introduces a variety of products including Pure Frost a limited edition
fragrance; the Botanicals Collection, available in three fragrances: Fig & Bamboo, Vetiver &
Cardamom, and Coriander & Mandarin; the Lavender line of products comprising an eau de
toilette, bar soap, body butter, body lotion, hand and body wash, hand cream, and talc. In
2012,thecompanyalsoreformulatesitsShavingEssentialsline.
The companys distribution network includes standalone retail stores, department stores,
onlineshoppingportal,andthenewlyintroducedcatalogs.
Sustainabilityisveryimportanttothecompanyandthereforeallitssoapsarevegetablebased
andbiodegradable.Thecompanyalsousesbiodegradableorrecyclablepackaging.In2012,the
companysgivesamakeovertoitsproductspackaging.IthasnoTMEin2012.
The U.S. sales of cosmetics and toiletries for CaswellMassey products are estimated at
EOSPRODUCTS
EOSProducts,whichstandsforEvolutionofSmooth,cameintobeingin2008withthelaunchof
itsUltraMoisturizingShaveCream.ThecompanyisheadquarteredinNewYorkandspecializes
innatural,innovative,andstylishlypackagedproductsthataretargetedtowardswomen.
EOSProductsofferingsnowincludelipbalms,jellies,andtreatments,handandbodylotions,
and shaving products. The EOS lip balms are the bestsellers for the company. The lip balm
smoothsphereandthehandlotionareuniquelypackedinsphereshapedcontainersthathave
an almost velvety touch on the outside. The company claims the EOS Smooth Spheres to be
100%NaturalandpackedwithvitaminEandSheaButter.EOSlipbalmsarecertifiedorganicby
theU.S.departmentofAgriculture(USDA).
InSeptember2012,EOSlaunchestheAliceinWonderlandLimitedEditionsetwhichincludes
threeflavoredlipbalmsincludingBlueberryPotion,SweetVanillaNonsense,andWatermelon
Wonderland. These lip balms come with a Mickey Mouse shaped indentation for the fingers.
Alsoin2012,thecompanyintroducesthePomegranateRaspberryflavoredLipBalm.
EOS finds mention in articles in popular fashion and beauty magazines including Brides,
Womens Health, Lucky, Teen Vogue, Star, OK!, Seventeen, and Cosmopolitan. It also
aggressivelyadvertisesinprintmedia,referringtoitsproductsscentsasflavors.
EOSProductshasachievedbroaddistributioninarelativelyshorttime.Thebrandisavailableat
mass merchandisers such as Walmart, Target, and Costco; drug stores including CVS,
Walgreens, RiteAid, and Duane Reade; online retailers, such as drugstore.com, soap.com,
amazon.com,andthecompanyswebsite.
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Sales for EOS Products in 2011 totaled $16 million. In 2012, the company shows a growth of
81.3%toreach$29million.Growthin2012issupportedbyaninordinatelyhighTMEof$17.7
million.ThelaunchoftheAliceinWonderlandLimitedEdition,rapidlyexpandingdistribution,
andthegoodperformanceofthelipbalmswhoseuniqueshapesstandoutonretailshelves
aidsinthecompanysgrowth.
ERNOLASZLO
In 1927, Erno Laszlo was founded by a Hungarian dermatologist and cosmetic businessman
namedErnoLaszlo.HeadquarteredatNewYork,NY,thecompanyprovidesdermatologicalskin
care products. In February 2011, RBS Special Opportunities Fund managed by RBS Equity
FinancebackedCharlesDentonintheacquisitionofErnoLaszlo.CharlesDentonisanEnglish
entrepreneurwhohasheldthepositionofchiefexecutiveinseveralbusinessenterprises.
Erno Laszlos product portfolio includes various skin care products, such as facial cleansers,
toners,moisturizers,antiaging,serums,masks,exfoliators,handcare,andbodycare.Products
aresegregatedonthebasisoftheskintype,concern,andcategory.Thecompanyalsoprovides
treatmentsforfacewrinkles,finelines,lackoffirmness,acne,stressedskin,skindiscoloration,
sun protection, and facial redness. In 2012, Erno Laszlo launches The Hollywood Collection, a
limitededitioncollectionofcustomblendedskincareformulations.TheHollywoodCollection
includes five productsInstant Eye Repair, Intensive Porcelain Veil, Morning Beauty Rescue,
RefreshMoistureInfusion,andVelvetNightCream.
Erno Laszlo promotes its products on social networking sites, such as Facebook, Twitter,
Google+, and YouTube and in magazines, such as Allure, Vanity Fair, Marie Claire, Harpers
Bazaar,People,andGlamour.Theproductsareavailableathighenddepartmentstores,such
asSaksFifthAvenue,Nordstrom,NeimanMarcus,andBergdorfGoodman.
Thecompanyssalesareestimatedtogrowby14.3%to$8millionin2012,upfrom$7millionin
2011.Salesgrowthissupportedbytheintroductionofnewproducts.
E.T.BROWNE
Establishedin1971,E.T.BrowneDrugCompanyisheadquarteredinEnglewoodCliffs,NJ,andis
amanufacturerandmarketerofpersonalcareproducts.
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Many of E.T. Brownes products are sold under the brand name Palmers. Palmers sells five
differentnaturalbasedskincareandhaircarelinesunderthenamesofCocoaButterFormula,
Shea Butter Formula, Olive Oil Formula, Olive Butter Formula, and Coconut Oil Formula.
However, E.T. Brownes ethnic hair care products are sold under the brand name Black &
Beautiful.
In2011,thecompanyhasaddedfournewproductstoitslineofPalmersCocoaButterFormula
SkinCareproductswhichincludePalmersCocoaButterFormulagentleexfoliatingfacialscrub,
PalmersCocoaButterFormulalotion,andPalmersCocoaButterFormulatummybutter.
Thecompanysproductsareretailedthroughfood,drug,andmassmerchandisersnationwide,
includingWalmart,Target,DuaneReade,Walgreens,andCVS.In2012,alargeportionofthe
companysTMEatalmost$15millonisattributedtotheCocoaButterformulaline.Overall,
in 2012, the marketer spends a TME of $18.8 million, spread primarily across television and
magazineadvertising.
Thecompanyconductsalotofpromotionalandmarketingactivitiesthorughsocialnetworking
siteswhichincludeFacebook,Twitter,andYouTube.ThecompanypromotesitsCocoaButter
Formula lip care and skin care range on its Facebook page. The company also promotes its
prodcutsthroughcoupons.
E.T. Brownes U.S. sales of cosmetics and toiletries are estimated at $34 million in 2012, up
3.0% from $33million in 2011, mainly driven by the increased promotional and marketing
activities.
EUROITALIA
Euroitaliawasfoundedin1978byGiovanniSgariboldiandsoonbecamealeadingplayerinthe
market for selective fragrances and makeup. The company is headquartered in Milan, Italy.
Euroitalia and its subsidiary Giver Profumi, have the license to manufacture and distribute
Versace and Moschino beauty products in the United States. Versace Profumi is the U.S.
subsidiaryofthecompany,locatedinNewYork.
Euroitalia is known to have specialized expertise in designing, manufacturing, retailing, and

distributing luxury fragrances, makeup, and skin care products. The company employs
approximately20employeesintheUnitedStatesasof2012.Euroitaliahasworldwidepresence
throughqualifiedsubsidiariesanddistributors.
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MinorCompanies
AfewofEuroitaliasbrandsincludeVersace,JohnRichmond,andMoschino.In2012,Euroitalia
introduces fragrances, such as the Viva Rock John Diamond, Yellow Diamonds, and Versace
Vanitas.In2012,thecompanysTMEamountstoapproximately$9million,withmajorityofit
being attributed towards magazine advertisements. Majority of the TME expenditure for the
company in 2012 is allocated to the Versace Bright Crystal and Versace Yellow Diamond
fragrances. The Versace Yellow Diamonds print advertisement features Australian model,
AbbeyLeeKershaw.
The marketing activities for these brands is mainly through print advertisements in leading
fashion and beauty magazines, such as Allure, Cosmpolitan, Glamour, and Vanity Fair and
television advertisements The company has a wellconnected distribution network in the
UnitedStates.Theproductsareretailedinover700doors,includingsomespecialtystores,such
asMacys,SephoraUlta,andNordstrom.
Domestic manufacturers sales of cosmetics and toiletries are $17million in 2012, up 13.3%
EXPANSCIENCELABORATORIES
Expanscience Laboratories was founded by Paul Berthom and Claude Guillon in 1950 and is
headquarteredinCourbevoie,France.ItoperatesasasubsidiaryofLaboratoriesExpanscience.
The company manufactures and distributes its products under the brand Mustela. It has
subsidiaries in Spain, Portugal, Italy, Belgium, Switzerland, Poland, Mexico, and the United
States. Its brand Mustela is sold in about 40 countries through its own subsidiaries and
distributorcompanies.Thecompanyhasabout12employeesintheUnitedStatesanditsoffice
islocatedinNewYork.
The company provides dermocosmetic products for babies, for pregnant women, and young
mothers.TheproductrangeundertheMustelabrandincludes,Bbdesignedforthehygiene,
bathing, changing, and skin protection of babies; DermoPediatrics skin care products
dedicated to caring for skin problems of newborns, babies, and children; 9 Months a line
createdtotakecareofskinbothduringpregnancyandaftergivingbirth;andSunprotection
sunprotectionfornewborns,babies,andchildren.
The companys product offering includes norinse cleansing fluids, facial cleansing cloths,
alcoholfreefragrancesprays,ultraprotectivefaceandbodylotions,moisturizingandsoftening
bodylotions,massageoils,nourishingandmoisturizingbalmforlipsandcheeks,soaps,dermo
cleansing gels, soapfree cleansers for hair and body, foam shampoos for newborns, baby
shampoos, cleansing milks, cleansing and soothing wipes, vitamin barrier creams, and sun
protectioncreams.
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The company sells its products through retailers, such as Sephora, Ulta, Skinstore, and
Dermstore. In 2012, manufacturers sales of the company in the U.S cosmetics and toiletries
marketareestimatedtobestagnantatrounded$2million,upfromthe2011salesofslightly
lessthan$2million.NoTMEforExpanscienceLaboratoriesbrandsareevidentin2012.
FACESTOCKHOLM
FACE Stockholm is a marketer and distributor of skin care products, makeup products, and
accessories, and is headquartered at Hudson, NY. The company is owned and operated by a
motherdaughter duo, Gun Nowak and Martina Arfwidson. The companys first shop was
openedin1982andwasanimmediatesuccess.FACEStockholmsproductsareavailableatover
50 locations globally. The companys product offerings include products for lips, eyes, face,
nails,skincare,andbodycare,aswellasbrushesandtools,bagsandcases,andeyewear.Some
oftheproductsofferedbyFACEStockholmareSkimrande,HealingFeet,BambooWalnutScrub,
NailSaver,AgelessToner,PerfectPrimer,andAloeVeraIntenseMoistureCream.
The company launches three liquid foundations in 2012: Ageless Foundation, Fresh Face
Foundation, and Mineral Foundation for all skin types. FACE Stockholm also launches Gldje
lipstick.ItalsolaunchesanewrangeofnailpolishincollaborationwithJ.Crew,amultibrand
specialty retailer of mens and womens clothing in the United States: Vibrant Flame, Neon
Sunset, Tulle Time, and Pinched Cheeks. It promotes through social and digital media like
Facebook,Twitter,andYouTubeinformingaboutnewproductlaunches,andprovidingdetails
onbenefitsandusageofitsproducts.ThereisnoevidentallocationofTMEbythecompanyin
2012.
FACEStockholmsproductsareavailableincompanyownedshopsintheUnitedStates(there
are three, all located in New York state), Sweden, Norway, and Finland, as well as through
different retail outlets and salons across the United States, the United Kingdom, Ukraine,
Sweden,Spain,SanMarino,Norway,theNetherlands,Italy,Germany,France,Canada,Belgium,
andAustria.Eachofitsstoreshasaprofessionaltogivemakeupadvicetoitsconsumers.
FACE Stockholms sales of cosmetics and toiletries in the United States remain constant at
$8millionin2011and2012.
FALICFASHIONGROUP
Falic Fashion Group was started by three brothersSimon, Jerome, and Leon Falicand the
company is headquartered in Hollywood, FL. Falic Fashion Group operates as a subsidiary of
DutyFreeAmericas,thelargestdutyfreeretailstoreoperatorinNorthAmerica.Thecompanys
regionalofficeisinPanama,anditoperatesacrossLatinAmerica.
4A40
MinorCompanies
Thecompanyisonlyintofragrancesitdevelopsanddistributesfragrancesworldwide.Some
ofthefragrancesonofferare:PerryEllisforMen,PerryEllisNight,PerryEllisforWomen,Eva
by Eva Longoria, Dy and Dyamante by Daddy Yankee, as well as the fragrance from Jennifer
Aniston.ThePerryEllisfragrancefranchisewasacquiredbythecompanyinJanuary2007.
Asizeableamountofthecompanysrevenuecomesfromthedutyfreestores,whichisoutof
the scope of this study. The products are also sold across specialty stores, such as Sephora;
departmentsstoresNordstrom,Dillards,Macys,andPerfumania,aswellasWalmart.
Thecompanysdistributionnetworkcomprisesover120dutyfreeshopsinmajorinternational
airports like Boston, Chicago, New York, Washington, and Miami, as well as international
gateways. It promotes through social and digital media like Facebook and YouTube. The
companydoesnotallocateanyTMEin2012.
FalicGroupssalesofcosmeticsandtoiletriesintheUnitedStatesareestimatedremainfixedat
$3millionin2011and2012.
FOCUS21
Focus21wascreatedin1980byhairstylists,cosmologists,andchemiststosolvehairandskin
care related problems. Soon after its establishment as a salon brand, Richard Ravid acquired
Focus21in1997.ItislocatedinRoyalOak,MI.Thecompanymarketshaircare,skincare,and
nailcareproducts.
Focus21shairproductsincludeFocus21SplashFinishingSpray,Focus21SplashSculptingFirm
Gel, Focus 21 Panasea Emergency Hair Repairing Formula, Focus 21 Panasea Hair Repair
DetanglingShampoo,Focus21JojobaShampoo,Focus21SeaplasmaDesigningGel,andFocus
21SeaplasmaHairBoosterPlus+.SomeofitsnaillaminateproductsincludeLiquidGlassNail
Laminate,NoMoreChipsNailLaminate,andNoMoreWrapsNailLaminate.Nonewproducts
arelaunchedin2012.
Focus 21s brands are available with online retailers like amazon.com, ebay.com, and
drugstore.comandatselectretailstoreslikeUltaandSears.Thebrandsarepromotedthrough
brochures.
Focus 21 employs a staff of approximately 70 people. Domestic sales of the company are
estimatedfor2012and2011areapproximatedat$8million.
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MinorCompanies
FREEMANBEAUTY
Freeman Beauty Labs was founded in 1976 and is based in Beverly Hills, CA. It operates as a
subsidiary of pH Beauty Labs, Inc. It provides a range of skin care products, hand and body
lotions,footcareproducts,andhaircareproducts.
ThecompanysskincareproductsaresoldundertheproductlinesFeelingBeautiful,VitaK
Professional,andEclos.BareFoot,BareFootRepair,BareHands,FeelingBeautiful,andC.Booth
areofferedunderFreemansbodycaresegment.Thecompanyshaircareproductsportfolio
comprises shampoos, conditioners, and hair styling products under Papaya, Pssssst, and Ellin
Lavarbrands.SomeofthebestsellingFreemanproductsarebarefootpeppermintandplum
footscrub,Psssstinstantdryshampoo,FeelingBeautifulavocadoandoatmealfacialclaymask,
andFeelingBeautifulmintandlemonfacialclaymask.
Freeman launched its new website in 2011 that tries to convey a youthful, accessible, and
modern image. The companys products are sold at its online stores as well as through drug
stores,foodstores,andmassmerchandisers.Walgreens,Target,CVS,andWalmartaresomeof
theleadingretailchainswhichmarketFreemanproducts.In2012,noTMEforFreemanBeauty
productsareobservable.
FreemanBeautyLabssalesintheUnitedStatesforcosmeticsandtoiletriesremainalmostflat
for2011and2012,andareestimatedat$9million.
FRESH
Freshwasfoundedin1991byLevGlazmanandAlinaRoytberg.Theprivatelyheldcompanyis
headquarteredinNewYorkCity,NY.FreshpartneredwithLVMHin2000gainingadvantageof
LVMHsvaluableexperienceinresearchanddevelopmentandexpertiseintheprestigemarket.
Today,outsideofitsownstores,Freshproductsaresoldacrosstheglobeanditsproductrange
in the United States includes fragrances, skin care products, hair care products, makeup
products,othertoiletries,andproductsforthehome.
In 2012, Fresh celebrates its 21st Birthday with the launch of a R. Nicholsdesigned limited
edition collection of Oval Soap Series and Stationery Set. The collection has been inspired by
three fresh scents including Patchouli, Sugar, and, Hesperides Grapefruit. Additionally, the
brand is giving out a complimentary Mini Sugar Lip Treatment Advanced Therapy with online
orders above $100. Also in 2012, the company introduces Sugar Berry Tinted Lip Treatment
Sunscreen SPF 15 which moisturizes, protects, and soothes lips while leaving a berry tint;
Seaberry Restorative Body Cream Tube hydrating and nourishing cream to soothe irritation;
SakeBathMini,withacompositionofmorethan38%sake;RoseHydratingGelCream,adaily
moisturizer that provides 24hour moisturization and protects against pollution; Peony
WhiteningEssence,adailyformulathathelpscorrectunevenskintoneandhyperpigmentation
and;RoseCleansingFoam,adailycleanserthathydratesandrejuvenatesskin.
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MinorCompanies
Freshholdsinstoreeventsregularly.FreshoffersaReFreshClientRewardsProgramwherein
clientsearnsrewardsforevery$100spentataFreshretailstore.Upon$500ofexpenditure,
clients are entitled to receive a $50 gift card. Presence on social media networks, such as
Facebook, Twitter, and Pinterest are of significance to Fresh in promoting its products. Fresh
products are also featured on the home shopping network, QVC. The company does not
allocateanysignificantamountofTMEin2012.
Fresh products are sold at independent outlets across Boston, New York, Los Angeles, San
Francisco,LasVegas,andDallas.Thebrandisalsopresentatotherretailers,suchasSephora,
Kiss & Makeup, Barneys New York, Blue mercury, CO Bigelow, and Neiman Marcus. Fresh
productsareavailableforpurchaseonlineonthecompanyswebsiteaswell.
Sales for Fresh in the U.S. cosmetics and toiletries market at the manufacturers level total
FRUITOFTHEEARTH
FruitoftheEarthwasfoundedbytheMcCurryandMichellfamiliesin1980.Itisheadquartered
inFortWorth,TX.Thecompanyisamanufacturerandmarketerofpersonalcareproductsand
health care products. The products are formulated based on the beneficial qualities of aloe
vera. Fruit of the Earth also offers three variants of dietary supplements which are based on
aloeverajuice.
Thecompanymanufacturesabout64SKUsofskincareproducts.Itprovidesfacialtreatments
that include moisturizer, cleanser, scrub, face mask, face serum, face crme, eye crme, and
skin care oil. The companys sun care products include general protection, dark tanning, full
spectrum continuous spray, and aftersun products for babies and kids. Its sunless tanning
productsofferlight,medium,anddarktanningcreams.Thecompanyslatestproductsinclude
vitaminEdailydefensemoisturizerandvitaminEalmonddailyscrubthatwereintroducedin
2010.
FruitoftheEarthpromotesitsproductsonsocialnetworksites,suchasFacebook,Twitter,and
YouTube. Theproductsareavailableatdrug,food,andmassmerchandiserstoreslikeKmart,
Shopko, CVS, Albertsons, Walgreens, Meijer, Family Dollar, HEB, Fred Meyer, Dollar General,
Safeway,RiteAid,andWalmart.
Fruit of the Earth has 75 employees as of 2012. Sales of the company are estimated at $7
millionin2012,evenwiththe2011sales.
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MinorCompanies
FUSIONBRANDS
Fusion Brands was established in 2003 and is based in Ottawa, Canada. Fusion Brands
manufactures and markets makeup and fragrance products. The companys products include
lotions, shower gels, lip color, lip liner, antiwrinkle moisturizers, and foundations. Its brands
includeCleanPerfume,FusionBeauty,andScentology.
FusionBrandshas16fragranceSKUs, ofwhich11arespecificallyforwomen.Thecompanys
FusionBeautybrandoffersfacialskincareandmakeupproductsundertheproductlinesSkin
Fusion,LipFusion,GlowFusion,LiftFusion,andLashFusion.
ThecompanysproductsaredistributedintheUnitedStates,Canada,Japan,Korea,Singapore,
Taiwan,Denmark,Finland,Holland,Norway,Sweden,andinEurope(dutyfreestores).
The Clean Perfume and Skin Fusion brands are distributed through department stores and
specialty stores, such as Nordstrom, Bloomingdales, Ulta, Sephora, Macys, and Saks Fifth
Avenue. Skin Fusion is also sold on the Internet and television through avenues, such as the
ShoppingChannel,HomeShoppingNetworks,andskinstore.com.Scentologyproductsaresold
exclusivelyatthemassmerchandiserTarget.
SomeoftheprominentprodcutsincludeStimuLashFusion,anintensivenightconditioninglash
enhancer treatment; PrimeResults, an antiwrinkle primer value set, and IllumiFill, line filling
luminizer.
Fusion Brands promotes its prodcuts through social websites which include Facebook and
Twitter.Italsogivescomplementaryfreegiftwithpurchasesthatexcced$60.00ormore,and
alsohasaschemeoffreeshippingforanyorderexceeding$50.00ormore.NosignificantTME
havebeenreportedbythecompanyin2012.
TheU.S.salesofcosmeticsandtoiletriesforFusionBrandsareflatatapproximately$14million
in2012,sameasthe2011levels.
GALDERMALABORATORIES
Formed as a joint venture between LOral and Nestle in 1981, to become a prominent
dermatology company, Galderma Laboratories, the Switzerlandbased company, is the
developerandmarketerofdermatologyproductsmeanttoprovidetherapeutic,corrective,and
aesthetic solutions. Galderma Laboratories is headquartered in Fort Worth, TX. The company
hasresearchanddevelopmentfacilitiesintheUnitedStates,Japan,France,andSweden.
4A44
MinorCompanies
Thecompanyoffersawiderangeofproducts,fromskincaretotopicaltreatmentsformajor
dermatological conditions. It addresses a number of skin conditions, which include acne,
dermatitis,melasma,rosacea,andpsoriasis.Inthecosmeticsandtoiletriesindustry,Galderma
LaboratoriescompetesinfacialtreatmentsandhandandbodylotionswithitsCetaphilbrand.
Cetaphil is retailed through food stores, drug stores, and mass merchandisers in the United
States. Cetaphil is primarily promoted through recommendations from doctors and
dermatologists.ThecompanyallocatesnegligibleamountsonTMEin2012.
In2012,CetaphillaunchesCetaphilDermaControlproducts,alineforacneproneskin.Anew
product,CetaphilMoisturizingCream,isavailableatWalgreens,beginningSeptember2012.
GaldermassalesofcosmeticsandtoiletriesintheUnitedStatesreach$92millionin2012,up
7.0%from$86millionin2011basedonnewproductlaunches,aswellasonitscorporatesocial
initiatives,whichhelpsinbrandrecall.
THEGAP
The Gap is a global specialty apparel company started in 1969. It is headquartered in San
Francisco, CA. The company offers personal care products, apparel, and accessories for men,
women,andchildren.Ithasmorethan132,000employeesworldwide.
The company sells its products under five brands including Gap, Old Navy, Banana Republic,
Piperlime,andAthleta.Thecompanyhasover3,263storesglobally,ofwhich3,036storesare
companyoperated and the rest are franchise store locations. The Gap stores operate in the
United States, Canada, the United Kingdom, France, Ireland, Japan, China, and Italy. In early
2012, it opens a new store in South Africa. The Gap operates under two segments: Stores,
whichincludetheoperationsoftheretailstoresforGap,OldNavy,andBananaRepublicand
Direct, which includes the operations for its online brands, both domestic and international.
Thecompanysproductsareavailableonlinetocustomersinover90countriesthroughitsown
website.
The company markets personal care products under an agreement with Inter Parfums Inc.
Womens fragrances from Banana Republic include W, Alabaster, Malachite, Jade, and
Rosewood.BananaRepublicsmensfragrancesareBlackWalnut,Slate,Classic,andCordovan.
Fragrance lines for Gap include Gap Bath+Body, Gap Body, and G7 for Men and Individuals.
Banana Republic and Gap offer ancillary skin care and body care products for their fragrance
brands. The company promotes its products through directmail initiatives, circulars, and
couponprograms.
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TheU.S.salesofcosmeticsandtoiletriesare$35millionin2012,upfrom$33millionin2011.
Thecompanyspends$1.8millionTMEtosupportitsbrandsin2012anditallocatestheentire
TMEtosupportitsBananaRepublicbrand.
GIOVANNIORGANICCOSMETICS
GiovanniOrganicCosmeticswasfoundedbyArthurGiovanniandisheadquarteredinBeverly
Hills,CA.Thiscompanydevelopsanorganiclineofskincareproductsformenandwomen.It
usesapatentedGiovanniPureOrganicTechnologythatincorporatesvitamins,herbs,minerals,
proteins,nutrients,andessentialoils.
GiovanniOrganicCosmeticsmanufacturesandmarketsaround63SKUsthatcatertohaircare,
personal cleansing, and skin care products. Its hair care products include shampoos,
conditioners, hair styling products, and hair repair treatments, while skin care includes body
lotions,facialcleanser,scrubs,moisturizer,andfacemask.Thecompanyalsooffersbodywash,
liquid soaps, body bars, body scrubs in the personal cleansing product class. The company
markets these products under brand names, such as Four Elements, Four Dreams, D:tox
System,Colorflage,2chic,andMagnetic.In2012,GiovanniOrganicCosmeticsintroducesanew
line called Wellness System with a Scalp Serum, and Conditioning & Styling Elixir. The 2chic
brand introduces eight variants which includes shampoos, conditioner, blow out styling mist,
flatironstylingmist,stylingelixir,hairandbodypotion,bodywash,andbodylotion.
Giovanni Organic Cosmetics advertises its products in popular magazines, such as Good
Housekeeping,People,Cosmopolitan,Allure,Health,andLucky.Productsarealsopromotedon
socialnetworkingsites,suchasFacebook,Twitter,andYouTube.GiovanniOrganicCosmetics
products are available in mass merchandiser stores, Target and Walmart, drug stores such as
CVS,foodstoressuchasKroger,WholeFoods,andFredMeyer,aswellasUlta.
Giovanni Organic Cosmetics is a privately owned company and employs 56 people. Sales are
estimatedtogrowat11.1%to$10millionin2012from$9millionin2011.
GOSMILE
GoSmilewasfoundedin2002bydentistJonathanLevine.In2008,JHPartners,aSanFrancisco,
CAbasedprivateequityfirmacquiredGoSmile.Aftertheacquisition,theheadquartersofGo
SmileshiftedfromNewYork,NYtoBerkley,CA.
4A46
MinorCompanies
Go Smile provides whitening light systems, teeth whitening pens, prewhitening gels,
toothpastes, and whitening ampoules. Based on Kline & Companys categorization, these
products can be divided into tooth whitening products and toothpastes. The company has a
workforceofapproximately50employeesasof2012.
ProductsareofferedunderWhitenYourTeethandKeepYourTeethWhiteregimens.The
company also offers sets and kits. Go Smiles products are distributed through retail stores,
online retailers, dental offices, and spas. Go Smile products are available in over 300 outlets
includingBliss,BeautyBrands,Bluemercury,Nordstrom,SaksFifthAvenue,andUlta.
Go Smile is present on social networking sites, such as Facebook and Twitter and offers a
numberofonlinediscountsandvaluedealsonthesesites.GoSmiledoesnotadvertiseitsown
products,butSephoradoesinvestminimallyinTMEforthebrand.
Sales for the company in the U.S. cosmetics and toiletries are $12million in 2012, flat from
2011.
GRACECHOI
GraceChoidebutsherbeautyskincarelineinmid2012.Sheisanentrepreneur,basedinNew
YorkCityandBostonwhoinventedmedicaldevicespreviously.Herinterestinskincarebegan
asaresearcheratWeillCornellMedicalCollege.GraceChoiwasinspiredbyKoreanBBcreams
tocreateherownBBandCCcreams.
Shelaunchesherallinonemediumtofullcoverageantiaging,sunblock,darkspotrepair,oil
control,andskinsmoothingproduct.GraceChoiPorcelainSkinBBCreamisavailableinadewy
or matte finish. The mineralbased cream provides a natural looking coverage while it treats
and conditions skin throughout the day. It is the first BB cream to be offered in 10 different
shades,suchasneutral,lightpink,mediumpink,lightolive,mediumolive,deepolive,medium
yellow, and dark yellow. The product can be obtained from the companys website, even
thoughinfall2012thereisawaitlisttofulfillorders.GraceChoiCCCreamwillbelaunchedin
early2013.
Domesticsalesofthecompanyareestimatedatlessthan$1millionin2012.
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MinorCompanies
HAIRRULES
Hair Rules was founded in 2008 by Anthony Dickey and Kara Young Georgiopolous. The
companyisbasedinNewYork,NY,andofferssalonpositionedhairproducts.Itoffersarange
ofhydratingcleansers,conditioners,andstylingaidstohairtypesdefinedaskinky,curly,and
wavy. Hair Rules product portfolio consists of hair care products, such as shampoos,
conditioners, styling, and finishing hair products. Some of its brands include Aloe Grapefruit
Purifying Shampoo, Quench Conditioner, Blow Out Your Kinks, Curly Whip, Wavy Mousse,
VolumizingHairSpray,andHydratingFinishingCream.ThecompanyintroducesLiftVolumizing
Shampoo, Blow It All Out (straight styling for all textures), and a 4Piece Trial Set for kinky,
curly,andwavyhairin2012.
BrandsarepromotedonsocialnetworkingsiteslikeFacebook,Twitter,YouTube,andGoogle+.
Onlineblogsandtestimonialspublicizetheeffectivenessoftheproducts.IntheUnitedStates,
HairRulesproductsareavailableinTarget,Walgreens,andvarioussalons.Corporatesalesof
thecompanyareexpectedtogrowby11.1%in2012to$1millionfrom$900,000in2011.
HAMPTONSUN
Hampton Sun is a private company founded by Salvatore and Grant in the year 2005. The
companymanufacturesanddistributesacompletelineofluxurysuntanningproductsdesigned
especially for individuals who enjoy the sun. The company is headquartered in New York.
Aside from sun care products, the company sells skin care products and fragrances under
HamptonSunandPrivetBloombrands.
All of the companys products are made with natural and organic oils, vitamins A through E,
Aloe,andpowerfulantioxidants.
In2012,thecompanylaunchesSPF8BronzeContinuousMistSunscreen,whichisclaimedto
offer the highest quality sun protection with a new hypoallergenic and oilfree formula
containingalightamountofitssignaturescent.
ThecompanysellsitsproductsthroughvariousretailersincludingBeautyBar,BlinkBeach,Blue
mercury, Hhbeauty, and Saks. It also markets its products through resorts, cruise ships, and
specialtyretailerSephora.
HamptonSunssalesintheU.S.cosmeticsandtoiletriesmarketareestimatedat$5millionin
2012,upfrom$4millionin2011.HamptonSunhasnegligibleTMErecordedin2012.
4A48
MinorCompanies
HERBALIFEINTERNATIONAL
Herbalife International was founded by Mark Hughes in 1980 and is headquartered in Los
Angeles, CA. The company manufactures and distributes nutrition, weightmanagement, and
skin care products globally. It employs around 5,100 employees worldwide. The company
distributes its products in 84 countries through a network of approximately 2.7 million
independentdistributors.
AllproductsaremarketedundertheHerbalifebrandname.Personalcareproductsmarketed
by the company include skin care, bath and body, fragrances, and hair care products. The
companyoffersthreelinesoffacialtreatments:NourifusionSkinEssentials,RadiantC,andSkin
Activator.TheHerbalAloelineoffershandandbodylotions,personalcleansingproducts,and
haircareproducts.Fragrancesareofferedinfourlines:Heart,Soul,Man,andWoman.
Total sales for Herbalife International are $4,154 million in 2012, up from $3,454 million in
2011. The U.S. manufacturers level sales of cosmetics and toiletries are estimated at
$25million in 2012, up from $23 million in 2011. Herbalife International has negligible TME
recordedin2012.
HERMSINTERNATIONALGROUP
Herms International Group was founded in 1837 by Thierry Herms and is based in Paris,
France. The companymanufactures and markets highfashion clothing and accessories. It has
14productdivisionsconsistingofleather,scarves,men'swear,women'sfashion,ties,watches,
perfume, stationery, footwear, decorative arts, enamel, gloves, tableware, and jewelry.
ParfumsHerms,itssubsidiaryintheUnitedStates,islocatedinNewYork,NY.Thiscompany
markets,distributes,andretailsluxurygoodsinNorthAmerica.
Thecompanyspersonalcareportfolioconsistsoffragranceproducts,theearliestofwhichwas
launchedin1951,EaudHerms.ItsnicheHermssencecollectionconsistsof10fragrancesthat
can be used by both men and women, including Rose Ikebana, Vtiver Tonka, and Ambre
Narguil. The company markets another eight unisex fragrances, including the Voyage
d'Herms, Eau de Pamplemousse Rose, Eau de Gentiane Blanche, and Jardin sur le Toit.
Furthermore, the Herms International Group develops nine fragrances for women and four
fragrancesformen.In2012,thecompanyintroducestwofragrancesforbothmenandwomen:
LAmbredesMerveillesandVoyagedHermsEaudeParfum.
Herms International Group promotes its products on social network sites like Facebook,
Google+, and YouTube. In the United States, products are distributed through 300 highend
department stores, such as Neiman Marcus and Nordstrom, in addition to 23 standalone
Hermsboutiques.
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MinorCompanies
Herms International Group has 9,526 employees at the end of June 2012. Estimated U.S.
manufacturers sales for cosmetics and toiletries in 2012 are $9 million, tantamount to 2011
sales.
HOUSEOFCREED
HeadquarteredinParis,France,HouseofCreedisaprivatelyownedluxuryfragrancecompany.
The company was founded by James Henry Creed in 1760 as a perfume boutique in London,
andsincethen,leadershiphasbeenpassedfromfathertosonforsixgenerations.Thecurrent
headofthecompanyisOlivierCreed,tobesucceededbyhisson,ErwinCreed.Themarketer
claims that their fragrances are hand made using natural essences. New Yorkbased
InternationalCosmetics&PerfumesdistributesCreedproductsintheUnitedStates.
Creedscollectioncomprisesfragrancesformenandwomen,handandbodylotions,personal
cleansingproducts,antiperspirantsanddeodorants,homefragrances,andcandles.Someofthe
popular brands from the company include Jasmal, Irisia, Orange Spice, Royal English Leather,
RoyalScottishLavender,andOriginalVetiver.
In2012,thecompanyintroducesluxurybodyproductsincludingabathandshowergel,large
handmilledsoap,aftershavebalm,andanonalcoholicdeodorantfortheMillesimeImperial
fragrance. In 2012, the company launches a product line the Acqua Fiorentina, The Encore
whichincludesafragranceforwomen,bathandshowergel,triplemilledsoap,nourishingbody
lotion,andnonalcoholicdeodorant.In2012,Aventus,oneofthemostpopularfragrancesof
Creed, also introduces its own line of luxury products comprising a shower gel, handmilled
soap,aftershavebalm,andanonalcoholicdeodorant(retailingfor$65).
Creed fragrances are retailed through Creed boutiques, the companys website, and luxury
retailers including Bergdorf Goodman, Neiman Marcus, Saks Fifth Avenue, select Nordstrom
andBloomingdaleslocations,VonMaur,Halls,andHoltRenfrew.TheHouseofCreeddoesnot
advertise,relyinginsteadonwordofmouthandeditorialplacement.
The U.S. manufacturers sales of House of Creed fragrances grow 10.0% from $10 million in
INTERFASHIONCOSMETICS
Founded in 1986, Interfashion Cosmetics specializes in the manufacturing, designing,

marketing, and distribution of color cosmetics in the domestic as well as the international
markets. The company is headquartered in Teterboro, NJ, and its color cosmetics range is
marketed by its wholly owned subsidiary, Pantina Cosmetics. A significant portion of
Interfashion Cosmetics revenues are generated from privatelabel manufacturing. The
company has been making privatelabel makeup, skin care products, bath and body care
products,andhaircareproductsforhighendbeautycompaniesforover25years.
4A50
MinorCompanies
Thecompanyhasastrongdistributionnetworkwithproductsbeingavailablenationwideacross
5,000 stores. Some of the selected retailers include CVS Duane Reade, Albertsons, Rite Aid,
Safeway,andWalgreens.
Sales of cosmetics and toiletries at the manufacturers level are estimated at approximately
$12millionin2012,constantfrom2011.TherearenoreportedTMEduring2012.
INTERPARFUMS
InterParfums, headquartered in New York, develops, manufactures and distributes perfumes,

cosmetics,andpersonalcareproducts.Itholdsanexclusiveinternationallicenseforpremium
fragrance and cosmetics brands, such as Burberry, Paul Smith, Montblanc, Boucheron, S.T.
Dupont,JimmyChoo,andVanCleef&Arpels.InterParfumsalsoownsNickelS.A.,amensskin
care company based in France, and Lanvin Perfumes. The company produces personal care
products for the mass market through an exclusive agreement with Anna Sui, Gap, Banana
Republic,BrooksBrothers,bebe,BetseyJohnson,NineWest,andLaneBryantbrands.
ThecompanysluxuryfragranceproductsareproducedandmarketedbyitsFrenchsubsidiary,
InterParfums, S.A. The companys U.S. operations cover mass market and specialty retail
products. InterParfums fragrance products are distributed through department stores and
specialtystores.Thecompanyentereda13yearworldwidelicenseagreementwithLaMaison
Repetto, in December 2011, for creating, developing, and distributing fragrances under the
Repettobrand,startingJanuary1,2012.Thefirstfragrancelineisexpectedtobelaunchedin
2013 by InterParfums SA. InterParfums announces the disagreement on the final terms on a
new operating model for the fragrance and beauty business between its subsidiary,
InterParfumsSAandBurberry,inJuly2012,andBurberrywillbuyoutthelicenserightstotake
effectMarch2013.
InterParfums wins the Best Fragrance Award for Anthropologie 1922 Lily Sanguine Eau de
Parfum,atthe40thAnnualFiFiAwards,intheSpecialtyBrandWomenscategory,inMay2012
atAliceTullyHallinNewYorkCitysLincolnCenter.
Thecompanylaunchesseveralnewproductsin2012:LoveFurybyNineWest,WildBloomVert
from Banana Republic, Gap Established 1969, Miss Madison by Brooks Brothers, Wishes &
Dreams from bebe, a new mens scent called Wild Blue from Banana Republic, and Anna Sui
fragrances, such as Dolly Girl, Flight of Fancy, Forbidden Affair, and Live Your Dream. It
promotes through social media websites like Facebook by informing about new product
launches,andprovidingreviewsaboutitsvariousproducts.InterParfumsallocates$14.1million
in TME for 2012. Its global corporate sales reach $654.1million in 2012, up 6.3% from
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ThemanufacturerssalesofcosmeticsandtoiletriesforInterParfumsintheUnitedStatesare
estimated at $48million in 2012, up 17.0% from $41 million in 2011 based on new product
launchesandwidedistributionofretailbrands.Someofitsbrandsarenotreportedhere,such
asBananaRepublic,whichiscountedunderGapssales.
INSPIREDBEAUTYBRANDS
Alleghany Pharmacal is a private company and is headquartered in Great Neck, NY. The
company has changed its name to Inspired Beauty Brands in 2012. It manufactures and
distributes hair care products across the United States. The company employs around 25
employeesasofOctober2012.
Thecompanymarketsmainstreamhaircarebrands,suchasHask,PureShine,SalonStyle,and
Jhirmackandethnichaircarebrands,suchasLustrasilkandVigorol,positionedtoreachvarious
demographics and professional markets, as well as OTC retail categories. Products marketed
underthesebrandsincludeshampoos,conditioners,hairstylingproducts,andethnichaircare
products. Bulk of the companys sales is through its mainstream products. The companys
products are sold across the United States through retail outlets, including food stores, drug
stores, and mass merchandisers, such as Walmart, Walgreens, Kmart, and Rite Aid. The
companyalsosellstobeautysupplydistributors.
Thecompanyfollowsthestrategyofacquiringsmall,decliningbrandsandturningthemaround
throughrightpositioning,marketing,anddistributionsupport.Noneofitsleadingbrandsbeing
marketedcurrentlywereoriginallylaunchedbyInspiredBeautyBrands.
InspiredBeautyBrandshasnoproductlaunchesin2012.Itpromotesitsbrandsthroughsocial
media sites like Facebook and Twitter by informing about new product launches, and adding
reviewsaboutitsvariousproducts.ThecompanyspendsanegligibleamountonTMEin2012.
Manufacturers sales for cosmetics and toiletries are estimated at $10 million in 2012, down
9.1%from$11millionin2011drivenbythelackofmarketingactivitiesandtheabsenceofnew
productlaunches.
IREDALEMINERALCOSMETICS
Iredale Mineral Cosmetics is a private company founded by Jane Iredale in 1994 and is
headquartered in Great Barrington, MA. The company manufactures and distributes makeup
products.JaneIredaleisthecurrentpresidentofthecompanyandhasabout135employees.
4A52
MinorCompanies
The company offers mineralbased makeup products in all four makeup product categories
coveredinthisstudy(face,eye,nail,andlip).Leadingmakeuplinesofferedbythecompanyare
Pure Pressed powders, Dream Tint foundations, Purelash mascaras, and Pure Moist lipsticks
and lip glosses. The companys face makeup product line includes mineral foundations,
concealers,blushandbronzerproducts;eyemakeupincludeseyeshadow,eyeliners,eyebrow
makeupandmascara;productsforlipscompriselipcrayons,balms,exfoliators,definers,colors,
andplumpers.Thecompanyalsoprovidessunscreensandlipbalmsformen.
Zap&HideBlemishConcealer,thedualendedconcealerstickconcealsandcalmsbreakouts
usingantibacterialandantiinflammatoryingredientsliketeatreeleafoil,chamomile,and
psoraleacorylifoliaextract.
PowderMeSPFDrySunscreencontainstitaniumdioxideandnaturalclaydriedinthesun
andisfreeofcontaminantsandatmosphericpollutants.
Theproductsareavailableinover50countriesglobally.IntheUnitedStates,IredaleMineral
Cosmeticsdistributesitsproductsthroughaestheticplasticsurgeons,dermatologists,spas,and
salons. The companys website also offers products for online purchase. It advertises its
products through trade and beauty magazines, such as Vogue and Life & Style. The U.S.
manufacturerslevelsalesforIredaleMineralCosmeticsareestimatedataflat$22millionin
2011 and 2012. The company spends $3.9 million TME to support its brands in 2012 and
magazines are the most preferred medium for promotion of the company, accounting for
approximately$3.8million.
ITCOSMETICS
Establishedin2008,ITCosmetics,aprivatelyheldcompany,wasfoundedbyJamieKernLima.
Thecompanyspecializesincolorcosmetics.ThecompanyisheadquateredinJerseyCity,NJ.As
of 2012, the company has over 17 employees. Its product premise relies on the companys
collaborationwithplasticsurgeonstoincludeantiagingtechnologyincolorcosmetics.
The company offers eye, lip, and face makeup, cosmetic brushes, minimal facial treatments,
and one cuticle care pen. The company has a product portfolio of over 45 product SKUs. In
2011, the company wins the Cosmetic Innovator of the Year Award for "Most Innovative
Company"byICMAD.SomeofthemajorbrandsforITCosmeticsincludeByeBye,Vitality,and
HelloLight.
In 2012, IT Cosmetics partners with the American Cancer Societys Look Good, Feel Better
(LGFB)program,whereinforeveryBrowPowerpencilsold,onepencilisdonatedtotheLGFB
program,inordertohelpwomenfacetheeffectsofcancerwithconfidence.
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Someofthenewproductsin2012includeVitalityGlowAntiAgingMatteBronzer,anantiaging
mattebronzerthatdeliversafaceperfectingvitalityglowandairbrusheffect.Itisinfusedwith
antiagingtechnologyandskincaretreatmentforyoungerlookingskin;VitalityLipFlushButter;
and Vitality Lip Flush 4in1 Natural AntiAging Lipstick Stain which takes the place of four
products;lipstick,antiagingconditioninglipbalm,ultrahydratinglipgloss,andlipstain.
The companys products are distributed in the United States, Canada, and Australia. It is
available in various channels which include QVC and Henri Bendel in the United States. The
productscanalsobepurchasedonlinethroughbeauty.com.Thecompanydoesnotallocateany
evidentTMEin2012.
ManufacturerslevelsalesofpersonalcareproductsintheU.S.cosmeticsandtoiletriesmarket
areestimatedat$2millionin2012up100.0%fromapproximately$1millionin2011,mainly
drivenbynewproductintroductions.
J.STRICKLAND
J. Strickland & Co. was establised in 1936 and is headquartered in Olive Branch, MS. It is a
manufacturerandmarketerofethnicskincareproducts,haircareproducts,andmakeup.The
companyemploysover60peopleintheUnitedStates.
ImportanthaircarebrandsfromthemarketerincludeBlueMagic,AfricanGold,RoyalCrown,
Sulfur8, Magnificent, Queen, and World of Curls. The company also markets the skin care
brands Nadinola and Artra. The bestselling product of the company is the Blue Magic
Conditioner.ThecompanypromotesitsproductsthroughtheInternetandmagazines.
The company also promotes its products through social networking sites like Facebook and
Twitter.SomeoftheonlinemagazineswheretheproductsarepromotedincludeSister2Sister,
Upscale, Today's Black Woman, Sophisticate's Black Hair Styles and Care, and Hype Hair. J.
Strickland allocates $439,300 in TME for 2012. The entire amount is spent on magazine
advertisements.
InMay2012,J.StricklandacquiresNaturesProtein,makerofDOOGROproducts.DOOGROis
apartoftheethnichaircareindustrysince1997,andconsistsofmorethan20productswhich
includehairvitalizers,shampoos,andconditioners.
The company launches two new products in 2012: Five Star medicated nongreasy dandruff
controlhairgroomingandBlueMagicpetroleumjellywithaloeveraandvitaminE.
The distribution for J. Stricklands products is nationwide through food, drug, and mass
merchandisers,includingWalmart,Kroger,andWalgreens,aswellasbeautysupplystores.
Manufacturers level sales of cosmetics and toiletries are at $7 million in 2012, equivalent to
2011levels.
4A54
MinorCompanies
JAFRACOSMETICSINTERNATIONAL
Founded by Jan and Frank Day in 1956 in Malibu, CA, Jafra Cosmetics International is a
manufactureranddirectsalesmarketerofbeautyandskincareproductswithoperationsin20
countries around the globe. As of 2012, the privatelyheld company reports that it has more
than555,000consultantsandannualrevenuesinexcessofhalfabillionU.S.dollars.Since2004,
Jafra Cosmetics is a member of the Vorwerk Group, a family enterprise with headquarters in
Wuppertal,Germany.Establishedin1883,Vorwerk&CoKGhasacorebusinessofdirectselling
consumerproducts,representedinover60countriesworldwide.
JafraCosmeticsoffersmorethan700cosmeticsandtoiletriesproductsthatthecompanysays
offeraffordableluxuryandatechnologicallyadvancedandhighperformanceportfolio.Product
collectionsincludeskinandbodycare,colorcosmetics,spaproducts,mensgroomingproducts,
andfragrances.ItssignatureproductlineistheRoyalJellycollection.
In 2011, the company lauched a new skin careproduct under the facial treatments category,
JafraPro,whichhelpswomenmaintainandrecoveryouthfulskinappearanceandisapplicable
forallskintypesandskintones.
In2012,thecompanypartnerswithBeautyBusFoundation,anationalnonprofitorganization,
that provides beauty and grooming services to people with chronic and terminal illness and
theircaregivers.ItdoesnotraditionaladvertisingintheUnitedStates.
TotalmanufacturerssalesforcosmeticsandtoiletriesforJafraCosmeticsintheU.S.cosmetics
andtoiletriesare$38millionin2012,aboutthesameas2011.
J.M.PRODUCTS
J.M. Products is a private company that is coowned and completely managed by Murrays
Worldwide.ItmanufacturesanddistributesethnichaircareproductsintheUnitedStatesand
internationally.ThecompanywasfoundedbyErnestP.Joshua,Sr.in1986,andisbasedinLittle
Rock,AR.Thecompanyhasapproximately110employeesintheUnitedStates.Thecompany
hastwomanufacturingfacilitiesinArkansas,bothlocatedatLittleRockandNorthLittleRock.
J.M.ProductsmarketsitsproductsunderitsbrandsIsoplus,UpTurn,OilofK,andBlackMagic.
The Isoplus brand umbrella has more than 100 SKUs of professional and retail products
includingaerosolhairsprays,shampoos,conditioners,hairrelaxers,stylingaids,andscalpoils.
The company also operates beauty and barber shops, as well as a beauty school to educate
beauticians. The majority of the companys products comprise styling aids. The top selling
productsforthecompanyinclude,MurraysPomade,MurraysBeeswax,IsoplusOilSheen,and
IsoplusNeutralizerShampoo.
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J.M. Products distributes its products through drug stores, such as Rite Aid, CVS, and
Walgreens;massmerchandisers,suchasWalmartandKMart;beautysupplystoreslikeSallys
Beautyandbeautysalons.
The companys manufacturers level sales of cosmetics and toiletries are estimated at
$40millionin2012,anincreaseof2.6%from$39millionin2011.J.M.Productshasnegligible
TMErecordedin2012.
JOEYNEWYORK
Joey New York, Inc., based in Sunny Isles Beach, Florida, was established by Joey Chancisa
skin care expert and the current CEOin 1993. The company manufactures and markets
solutionbasedmakeupandskincareproductsthatarehealthy,effective,andaffordable.
The company designs its products to enhance beauty by using pure and safe exotic natural
ingredients.SomeoftheproductsonofferarePeelOffMasque;LineUpforremovingwrinkles
onfaceandeyes;ShedtheRedforskinredness,andunevenskintoneanddullness;ByeBye
Blackheadstoremoveblackheads,reducelargepores,andtreatacne.
JoeyNewYorklaunchesthefollowingnewproductsin2012:CorrectALineforfaceandeyesin
2012,whichcomprisesthebenefitsoftendergreencoconutwaterandIndianginsengextract
complexforsmoothing,healing,andprotectingskin;KeepItupforaninstantnaturalfacelift;
LineUpforminimizingindividuallinesandlargeporesonfaceandeyes.
Joey New York products are available online at skin Store.com, spalook, dermstore.com, and
beauty.com.ItpromotesthroughsocialanddigitalmedialikeFacebook,Twitter,andYoutube
byinformingaboutnewproductlaunches,andreviewsonitsvariousproducts.NoTMEforthe
companysproductsareevidentfor2012.
The manufacturers sales for cosmetics and toiletries in the United States are estimated at
approximately $18million in 2012, up 8.6% from $16 million in 2011 based on new product
launches.
JOHNPAULMITCHELLSYSTEMS
John Paul Mitchell, one of the leading privatelyheld companies in the professional hair care
industry, sells its professional products across more than 150,000 beauty salons in nearly 90
countries.
4A56
MinorCompanies
John Paul Mitchell Systems was founded by John Paul DeJoria and the late Paul Mitchell in
1980. The founders wanted to provide luxury hair care at an affordable price and launched
three products: Shampoo One, Shampoo Two, and The Conditioner. The company currently
produces more than 100 products. John Paul DeJoria is the chief executive officer of the
company, whereas, Angus Mitchell, Paul Mitchells son, serves as the companys artistic
director.JohnPaulMitchellSystemsisheadquarteredinBeverlyHills,CA.
JohnPaulMitchellsprofessionalhaircarerangecomprisesPaulMitchell,AwapuhiWildGinger,
TeaTree,ModernElixirs,PaulMitchellProfessionalHairColor,andPaulMitchellProTools.The
companyispresentinthefollowingthreecategories:shampoos,conditioners,andhairstyling
productsandsprays.
In2012,JohnPaulMitchellSystemsisentering2,000selectMarriotthoteldoorsacrossNorth
Americaa first for the company. About 24 million units of four unisex Paul Mitchells Salon
ClassicsproductsaretobemadeavailablethroughfourMarriottbrands:CourtyardbyMarriott,
SpringHillSuitesbyMarriott,ResidenceInnbyMarriott,andTownePlaceSuitesbyMarriott.
Thecompanylaunchestwonewproductlinesin2012:N+colorlineandtheTruthAboutCurls.
N+colorlineofferssevenshades,fromlevels3to9thatguaranteemaximumcoverageandcan
bemixedwithotherPaulMitchelltheColorshades.
TheTruthAboutCurlslineisoutwithfournewproductsSpringLoadedDetanglingShampoo,
Full Circle Leave In Treatment, Ultimate Wave Beachy Texture Cream Gel, and Twirl Around
CrunchFree Curl Definerthat are designed specifically to create frizzfree and humidity
resistantcurls.
JohnPaulMitchellisactiveonsocialmediawebsiteslikeFacebookandTwitterthroughbrand
promotions, showcasing skills on hair styling and cutting techniques, as well as sharing its
success stories. It also relies on marketing through hair stylists to increase sales in salons, its
primarydistributionchannel.In2012,thecompanyallocates$23.5millioninTME.
Total sales for cosmetics and toiletries in the United States are estimated at $156million in
2012, up 0.6% from $155 million in 2011, due to new product launches and an expansive
distribution.
JOHNSONPUBLISHINGCOMPANY
HeadquarteredinChicago,IL,JohnsonPublishingCompany,Inc.isaleadingAfricanAmerican
owned publishing firm in the United States. It has an established business in publishing,
cosmetics,televisionproduction,andfashion.Foundedin1942byJohnH.Johnson,thefirmhas
five divisions: Fashion Fair Cosmetics, JPC Consumer Products, Ebony Fashion Fair traveling
fashionshow,Ebonyjetonlinemagazine,andEbonyjetEntertainmentGroup.Thecompanyhas
morethan2,000employees.
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Inadditiontopublishing,thecompanyproducesalineofhaircareproducts(SupremeBeauty)
and cosmetics (Fashion Fair) marketed for AfricanAmerican women. Products offered by the
company include facial treatments, face makeup, eye makeup, and lipsticks and lip glosses.
Many Fashion Fair items are available in fragrancefree versions. Fashion Fair Cosmetics are
soldinaround700storesnationwide,includingMacys,Dillards,andLord&Taylor.
Inaddition totheUnitedStates,productsarealsoavailableinCanada,Africa,theCaribbean,
England, France, and other countries around the world. All manufacturing and packaging
functionsareoutsourcedtocontractors.Thecompanypromotesandsellsitsproductsthrough
itswebsiteanddepartmentstoresincludingMacy's,Lord&Taylor,BonTon,Belk,andDillard's.
Thecompanylaunchesavarietyofnewproductsin2012,someofitskeylaunchesinclude:
Grapesicle Lipstick claimed to be uniquely formulated to defy drying and is infused with
vitaminE.
RebelLipstickisinfusedwithvitaminEandconditionsthelips.
Lurelipglossisclaimedtobeformulatedwithauniqueblendofsoothingbotanicalsthat
conditionandmoisturizedelicatelips.
SoColdNailLacquerismadefromchipproofformulathatdriesfastandwillnotfade.
Sales at the manufacturers level for Johnson Publishing Company in the U.S. cosmetics and
toiletries market total $47 million in 2012, up 2.2% from $46 million in 2011. Johnson
Publishing Company spends $1.1 million TME to support its brands in 2012. The company
spendsapproximately90.9%or$1millionofthetotalTMEthroughmagazineadvertisements.
JONATHANPRODUCT
JonathanProductisaluxuryhaircarelinefoundedin2005,inspiredbyprofessionalhairstylists.
It is located in Linthicum Heights, MD, and employs around eight people. Jonathan Products
formulas utilize purified, deionized essential water infused with natural botanicals. The
companyshairproductsaremadeofingredientsfromnaturaloilsandexoticbutters.
JonathanProductmarketshaircareproducts,suchasshampoos,conditioners,andhairstyling
products. The companys hair care collection includes Infinite Volume, Weightless Smooth,
Hydrating, Green RootineNatural, Dirt, and Dry Shampoo. In 2012, Jonathan Product
introduces its Green Rootine Dry Shampoo Brush on Hair Powder in two variants: dark and
light.Thisproductisahairpowderthatcleansesthehairandscalpwithouttheuseofwater.
Products are promoted on social network sites like Facebook, Twitter, and YouTube and in
magazineslikeAllure,Elle,Cosmopolitan,Vogue,People,Lucky,Self,MarieClaire,Vegas,Star,
W, Fashion, Prevention, and InStyle. Jonathan Products brands are available with select
retailers including Ulta and Nordstrom, and through online retailers like dermstore.com,
beautysak.com, folica.com, and beautybar.com. Corporate sales of Jonathan Product are
estimatedatunder$1millionin2012,unvaryingfrom2011levels.
4A58
MinorCompanies
JOSIEMARANCOSMETICS
Josie Maran, an actress and an entrepreneur, launched her natural cosmetics products line,
Josie Maran Cosmetics, in 2007. Based in Los Angeles, CA, Josie Maran Cosmetics develops
arganoilbasedskincareandcosmetics.Besidesarganoil,thecompanysproductsarecreated
with other natural ingredients, such as shea butter, olive oil, rosemary oil, papaya extract,
cucumber,flaxseedoil,coconutoil,andavocado.
JosieMaranCosmeticsportfolioconsistsoffacemakeupproductslikefoundation,concealer,
bronzer, powder, and primer; eyemakeup products, such as eye shadow, eye liner, mascara,
andlipsticksandlipglosses.Thecompanyalsomarketshaircareandskincareproducts,suchas
hair mist, hair serum, tanning cream, and body butter. Some of its brands include Argan
MatchmakerSerumfoundation,ArganPressedPowderNatural,ArganMagicMarkerliquideye
liner, GOGO Instant Natural Volume Argan mascara, Argan Natural Volume lip gloss, Argan
Cleansing Oil, Argan Oil Hair Serum, and Argan Sun Protection for the Body. In 2012, the
companyintroducesJosieMaranArganHighGlossLipQuench,ArganHotOilSelfHeatingHair
Treatment, Bohemian Waves Argan Hair Mist, Argan Matchmaker Powder Foundation, and
ArganBrighteningBronzerSunCorrector.
Josie Maran Cosmetics brands are promoted on social network sites like Facebook, Twitter,
YouTube, online blogs, and in magazines like Allure, Audrey, Beauty Biz, Brides, Lucky, Life &
Style, Vanity Fair, Vogue, Natural Health, Glamour, Zink, Whole Living, Teen Vogue, and
Seventeen. Products are available at josiemarancosmetics.com, QVC, sephora.com, and all
Sephoralocations.
The cosmetic company employs around 50 people and its corporate sales are estimated at
$12millionin2011.SalesofJosieMaranCosmeticsareestimatedtogrowby8.3%from2011
to$13millionin2012.
JUICEBEAUTY
Juice Beauty was founded by Karen Behnke in 2004 and is based in San Rafael, CA. The
company offers organic cosmetic, skin care, and hair care products in the Asia Pacific, North
America,andEurope.JuiceBeautyusesingredients,suchasalphalipoicacid,coenzymeQ10,
DMAE,peptides,fatsolubleVitaminC,andessentialfattyacidsinits products. Thecompany
claimstoplaceover100USDAcertifiedorganicingredientsintoa100%certifiedorganicjuice
baseandhasatotalorganiccontentofupto98%ineveryproduct.
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MinorCompanies
Thecompanysproductportfolioconsistsofskincareproducts,suchascleansers,toners,and
moisturizers, makeup products like foundations, concealers, and lip glosses, and hair care
productsthatincludeshampoosandconditioners.SomeofitsskincareproductsincludeGreen
AppleCleansingGel,BlemishClearingMask,GreenAppleAgeDefySerum,SimplyNourishing
Moisturizer, Green Apple Firming Body Moisturizer, and Exfoliating Cleanser. Juice Beautys
makeup products consist of Irresistible Glow Facial Highlighter, Blemish Clearing Powder,
PerfectingFoundation,CorrectingConcealer,andIlluminatingEyeColor.Thecompanymarkets
fourSKUsinhaircare:BrighteningShampoo,PomSmooth Shampoo,BrighteningConditioner,
andPomSmoothConditioner.
Apart from North America, products are distributed in the Asia Pacific and the European
regions. In the United States, JuiceBeauty products are available in specialty stores including
Ulta, food stores including Whole Foods, at various salons and spas, and online retailers like
amazon.comanddermstore.com.SocialnetworksiteslikeFacebook,Twitter,Tumblr,Pinterest,
andYouTubeandonlineblogsarepopularpromotionalmediautilizedbythecompany.
Corporate and U.S. manufacturers sales of the company are estimated to remain flat at
$5millionand$3million,respectively,in2012.
KISSPRODUCTS
HeadquarteredinPortWashington,NY,KissProductswasfoundedin1989.KissProductsisa
private manufacturer and distributor of professional quality nail products. With growing
popularity, the company expanded its distribution network to drug stores and massmarket
merchandisers,suchasWalgreensandWalmart.Fashionnailsanddecoratedwearnailsare
thecompanyskeyareaoffocusfollowedbywomensfalseeyelashes,cosmetics,haircoloring
products,andhairaccessories.
Kiss launched its second brand, Broadway Nails, to attract the nail care market by making
available to consumers athome salonlike manicures easily and quickly. Kiss and Broadway
Nailsareavailablein96countriesworldwideacrossdiverseretailchannels.
In2012,thecompanylaunchesGradationPolisheswithlayercolorsforafadedstylemanicure,
andEverlastingGelPolishwithhighglossshineforwearuptotwoweeks.TheImpresslinea
fullcoverdesignerstickerthatisnotharmfultothenail,hasbeenthecompanysbestselling
linein2012.
4A60
MinorCompanies
Kiss Products is advertised in magazines including People, Star, Glamour, Seventeen,

Cosmopolitan, and O Magazine. The company also showcases its products through television
advertisements that appear exclusively on cable channels in latenight time slots, spending a
total of over $17 million in TME 2012. The companys market strategy involves targeting
celebrities to try on their products and make style statements at big functions with bloggers
capturing the information and posting it on their blogs. Actress Nicole Scherzinger is the
spokesperson for the Impress line. As a part of its promotional strategy, the company often
comesoutwithanumberofgiveawaysanddiscounts.Thecompanyswebsiteactsasasource
ofeducationforconsumerswithhowtovideosexplainingtoconsumersthecorrectapproach
toputtingonandtakingoffgluednails.
KissProductsareavailableatmassmarketretailersandbeautysupplylocationsincludingdrug
stores, such as CVS, Duane Reade, Kmart, Meijer, Rite Aid, Target, Ulta, Walgreens, and
Walmart.Manufacturerssalesofcosmeticsandtoiletriescoveredinthisreportareestimated
at roughly $12million in 2012, up 9.1% from $11million in 2011 (note: excludes nail art and
decals).
KISSMYFACE
KissMyFaceisaprivatelyheldmanufacturerandmarketerofnaturalpersonalcareproducts.
The company is based in Milford, CT, since the time of its inception in 1981 by two friends,
RobertMacleodandSteveByckiewicz.Thebrandwasestablishedona200acrefarminHudson
River Valley, NY. The company has 50 employees worldwide. The brand has close to 30,000
pointsof saleworldwide,includingnearly14,500intheUnitedStates.KissMyFaceproducts
aresoldinatotalof19countriesincludingtheUnitedKingdom,SouthAfrica,Canada,Norway,
Germany,Croatia,HongKong,Guam,Taiwan,andthePhilippines.Theproductsarelargelysold
throughnaturalfoodstores,pharmacies,specialtystores,spas,andsmallgroceryshops.
In the United States, Kiss My Face has products across several categories, with close to 200
different SKUs spanning toiletries, skin care, hair care, and oral care, as well as a few home
fragranceproducts.KissMyFacesskincareproductportfolioincludeshandandbodylotions,
sun care products, childrens skin care, and facial treatments. The company also offers
deodorants, foot scrubs and creams, shave creams, hand soaps, shower gels, mouthwash,
toothpaste,conditionersandshampoos,lipbalms,glosses,andliptints.
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Thecompanycontinuestoextenditslineofproductswithnewlaunches.Thekeylaunchesfor
KissMyFacein2012include:
KissMyFaceTripleActiontoothpaste:Thetoothpastecontainsnaturalingredientsincluding
oliveextracts,Icelandmosesextract,teatreeleafoilandisfreefromSLS(Sodiumlaureth
sulfate).
KissMyFaceNaturalMineralSunscreenSPF40:Thesunscreencontainsanaturalmineral
formulathat helps reduce irritation, fight the signs of aging and provides Broad Spectrum
SPF40protection.
Kiss My Face Sun Spray Lotion SPF 30: This spray is specially formulated with aloe and
antioxidantgreenteatoprotect,moisturizeandsoothetheskin.
KissMyFaceSportLipBalm:Madewithnaturalbeeswax,coconutoil,VitaminEandShea
Butter,thislipbalmwillsoothe,smoothandprotectlipsallday.
Kiss My Face Peace Soap: The soap is formulated with 100% natural ingredients including
olive,coconutandjojobaoils.
IntheUnitedStates,thebrandsellsitsproductsthroughsomelargeretailerslikeWholeFoods
andCVS.KissMyFacesproductsarealsoavailablethroughWalmartandonlineretailers,such
as herbalremedies.com, amazon.com, and drugstore.com. Kiss My Face uses point of sale
materials,theInternet,andprintadvertisingasthepromotionaltoolstomarketandadvertise
itsproducts.Socialnetworkingwebsites,suchasFacebookandtwitter,constituteamajorpart
of the brands Internet promotions. At times, the brand also offers samples and discounts as
consumerpromotions.
Sales of cosmetics and toiletries in the United States at the manufacturers level are
approximately $29 million in 2012, up from $27 million in 2011. Hand and body lotions, and
facialcareproductsarethebiggestcategoriesforthebrand.
KOSAMERICA
HeadquarteredinJapan,Koswasfoundedin1946byKozaburoKobayashi.KosAmericaisthe
U.S. division of Kos Corporation. Since its inception, the prime focus for Kos has been to
developtechnologicallyadvancedcosmetics.Thecompanygloballyhasabout5,500employees.
Kos Corporation was listed on the Tokyo Stock Exchange in 2000 and is also the creator of
AwakeandSekkiseibrands.
Awake,anestablishedbrandinJapan,enteredtheUnitedStatesin1997throughHenriBendel
storesinNewYork.Awakeoffersskincareandbasemakeupproducts.AwakeutilizesJapanese
technology to incorporate natural botanicals into formulations that are suitable for sensitive
skin. Sekkisei, Koss other brand available in the United States, is a formulation of Japanese
andChineseherbalextracts,whichoffersproductsthathydrate,replenish,andbrightenskin.
Sekkisei brand offers three product lines: Sekkisei, Seikisho, and Junkisui. Both, Awake and
SekkiseibrandsareretailedthroughBergdorfGoodmanstoresinNewYork.
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To promote its products, Sekkisei holds events where licensed aestheticians use and
demonstrateSekkiseiproducts.In2012,thecompanylaunchesitsglobalwebsite.Sekkiseigives
away two complimentary samples on every online order. The company does not spend on
advertisingthroughbroadcastorprintmedia,butitdoessponsortheStarsonIceskatingshow
in2012,for$56,000.
U.S.manufacturerslevelsalesforKosareestimatedat$2millionin2012,fixedfrom2011.
LAQA&CO
Founded in 2010, Laqa & Co started as a company that develops high gloss nail polishes in a
pen.BasedinNewYork,NY,thecompanyalsomarketsnailpolishandlippencils.Nailpolish
pens are designed for an easytouse, quick, and neat application of the product. The brand
promotesupcomingdesignersbyfeaturingtheirartworkonthepackagingofitsproducts.
The company markets30 SKUs of nail polish, nail polish pen, and lip pencils. Some of its nail
polishbrandsareavailableinamixofcolors,suchasredbrown(Plonk),bluepurple(Blurple),
and greybeige (Fancypants). Its nail polish pen consists of brands like Incestous (lavender),
Birthday Suit (nude), WTF (pink), Toff (navy blue), and Greedy Guts (red).In 2012, Laqa & Co
launches the fat lip pencils in five different shades: Ring of Fire, Wolfman, Bossy Boots,
Lambchop,andFairyblood.
Brands are promoted in online blogs and social network sites like Facebook, Twitter, and
Tumblr.Productsareavailableinretailstores,suchasPlanetBeautyandAnthropologieandat
varioussmallscalestores.Itcanalsobepurchasedonlinethroughwebsiteslikedermstore.com,
asos.com,indigo.com,powderrooms.com,3floz.com,beautyHabit.com,andbglowing.com.
Corporatesalesofthecompanyareestimatedtobeunder$1million,eapproximatelyflatfrom
the2011levels.
LAVANILALABORATORIES
Lavanila was founded by Danille Raynor in 2006. The privatelyowned company is

headquartered in San Francisco, CA. The company got its name Lavanila when Danielle
discovered that the key ingredient in most of her products, Vanilla, is known as Lavanila in
Madagascarwhereitissourcedfrom.Thecompanysbiggestsuccesstodateoccurredin2007,
whentheretailchainSephora,begantocarrythecompanysvanillabasedfragrances.
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Thecompanyhasgrownitsproductofferingquickly,from3productofferingsin2007toover
70 in 2012. Lavanilas product range includes fragrances, deodorants, hand and body lotions,
personal cleansing products, lipsticks and lip glosses, sun care products, and baby care
products. The companys bestseller is the Vanilla Lavender Mini Deodorant. The company
claimsthatitsown100%Healthysealrepresentshealthyingredients,freeofharshchemicals,
scientificallyproventobeeffectiveandsociallyresponsible.
In 2012, the company revamps its website to make the consumers shopping experience
convenient and informative. Through its new website, the company introduces the sample
strategywherebyitcreatesexclusivesamplesetsforitsconsumersbasedontheirneeds.
In2012,Lavanilafeaturesinmagazinesandnewspapers,suchasUSWeekly,InStyle,andMetro
NY. The company has presence on social networking sites including Facebook and Twitter.
Lavanila has its own blog. In 2012, the company conducts a variety of promotional activities
includingafreeLavanilacosmeticbagonpurchasesofabove$40.00,offeringa25%discount
oncyberMonday,choiceoftwofreesampleswithonlinepurchases,buyonegetonefreeon
bodywashesand2in1showershave,andfreeshippingonordersabove$50.00.Lavaniladoes
notreportanysignificantTMEfor2012.
LavanilaproductsareretailedthroughSephora,SephoracountersinsideJCPennystores,QVC,
Kitson, Ebeauty, online retailers such as beautybar.com, drmstore.com, skinstorecom, Urban
Outfitters,QVC,amazon.com,beauty.com,anddiapers.com.
SalesforLavalinaintheU.S.cosmeticsandtoiletriesmarketatthemanufacturerslevelin2012
areestimatedat$7million,up16.7%from$6millionin2011.
LOCCITANE
LOccitane is a global manufacturer and retailer of natural and organic ingredientbased

cosmetic personal care products, headquartered at ManosqueenProvence, France. The
companywasfoundedin1976byOlivierBaussan,whopreparedhisfirstnaturalproductswith
essentialoils,andsoldtheminthemarketsofProvence.LOccitanesfirststoreopenedin1978.
The company has three brands in its portfolio: LOccitane, Melvita, and Le Couvent des
Minimes.LOccitaneistheflagshipbrand,andissoldinmorethan90countries,throughmore
than1,900retaillocations,bymeansofavarietyofwholesaleandinhouseretaildistribution
channels.Melvita,aleadingorganicandpersonalcarebrand,hasitsownretailnetwork,andLe
CouventdesMinimesisanaturalingredientbasedbrand,whichisdistributedmainlythrough
wholesalers.
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AsofMarch31,2012,LOccitanehas2,082retaillocations,anincreasefrom1,828asonMarch
31,2011.Thenumberofownretailstoresstandsat1,053asonMarch31,2012,anetincrease
of 158 stores, adding 80 stores in Asia, 53 in Europe, and 25 in the Americas. The TME for
LOccitaneproductsareabout$769,300in2012.
The company offers a range of products across fragrances, facial treatments, hand and body
lotions,personalcleansingproducts,haircare,andmen.AllLOccitanesproducts,exceptthe
suncarerange,areparabenfree.
SomeofthenewproductlaunchesbyLOccitanein2012areSheaButterHoneWhippedbody
cream,SpringCherryEauDeToilette,ImmortelleBrighteningFoamingcleanser,andImmortelle
BrighteningFaceMist.ThecompanypromotesthroughsocialanddigitalmedialikeFacebook,
Twitter,andYouTube.
Thecompanyscontinuedfocusonitslongtermgrowthstrategyandfurtheracceleratedretail
network and topline helps the manufacturers sales of cosmetics and toiletries in the United
Statesreach$94millionin2012,up5.3%from$88millionin2011.
LORACCOSMETICS
Lorac Cosmetics is a private company founded by Carol Shaw, a makeup artist based in
Hollywood in 1995. It is headquartered in Valencia, CA. The company manufactures and
distributespersonalcareproductsintheUnitedStates.Thecompanyemploysabout20people.
All products are sold under the brand name Lorac. The personal care range consists of color
makeupproductslikelipsticks,lotions,foundations,andeyeshadows,aswellasbathandbody
products.Thebestsellingproductsofthecompanyareitsbronzersandblush.
EyeCandyeyepencilwithaluxuriousassortmentofvelvetysmooth,richcolorsforavariety
ofenticinglooks.Itisavailableinfourshades:coal,plum,cocoa,andlicorice.
Sweet Temptations lip gloss comes in an assortment of rich colors and is available in six
scentsincludingCandyApple,Butterscotch,CrmeBrule,CottonCandy,FrostedGumdrop,
andSugarPlum.
The companys products are sold through specialty and department stores, such as Sephora,
Macys,andNordstrom.SalesatthemanufacturerslevelintheUnitedStatesareestimatedat
$7millionfor2012,upfrom$6millionin2011.LoracCosmeticshasnegligibleTMErecordedin
2012.
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LUSHFRESHHANDMADECOSMETICS
LushFreshHandmadeCosmeticsisheadquarteredinPoole,DorsetintheUnitedKingdom.Itis
aprivatelyheldcompany,whichwasfoundedbyMarkandMoConstantinein1995.Lushhas
morethan700storesin43countries.Thecompanyalsooperatesfivespas,includingfourinthe
United Kingdom and one in Tokyo, Japan. The manufacturing activities of the company are
spreadinfourcontinents.About950peopleworkwithLushFreshHandmadeCosmeticsinthe
UnitedStates.
Thecompanymanufacturesitsproductsfromfresh,organicfruitandvegetables,essentialoils
and,itclaims,safesynthetics.Theproductsaresaidtocontainlittleornopreservativesand
are made by hand. The company buys ingredients only from companies that do not conduct
tests on animals. The company also uses only vegetarian ingredients to develop its products
andfragrances.
Thecompanymanufactures,distributes,andsellsmorethan400SKUsofpersonalcareitems.
The companys product portfolio includes personal care (soaps, shower gels, bath bombs,
bubblebars);haircare(solidordryshampoosandhairconditioners),andskincare(handand
bodylotionsandfacemasks).Italsoproducesproductslike,"ShowerJellies,"gelatinlikesemi
solid shampoos and body wash; "Toothy Tabs," solid toothpaste tablets; and "Bath Bombs,"
solidballsmadeofsodiumbicarbonate.
Thecompanylaunchesavarietyofnewproductsin2012,someofitskeylaunchesinclude,Eyes
Right mascara, Emotional Brilliance Translucent face powder, Charisma Tint/Primer, Feel
YoungerPrimer,andgiftsets.Thecompanypromotesitsproductsthroughitsecommercesite
andcatalog.Lushsellsitsproductsthroughmorethan60specialtystoresinstreetfront,mall,
and airport locations, through print catalogs, mail order, and online. Lush Fresh Handmade
CosmeticshasnegligibleTMErecordedin2012.
SalesintheUnitedStatesatthemanufacturerslevelareestimatedat$43millionin2012,up
LUSTERPRODUCTS
LusterProductswasfoundedbyhairstylistFredLuster,Sr.in1957andiscurrentlymanagedby
hissonJoryLuster.Thecompanymakesprofessionaluseandconsumerpersonalcareproducts
forpeopleofAfricandescent.LusterProducts,headquarteredinChicago,IL,employsover400
peopleworldwide.ThecompanyhasmanufacturingfacilitiesinIllinoisandinternationalbranch
officesinSouthAfricaandtheUnitedKingdom.
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The company sells products for men and women sold under several brand names, including
Pink Brand products for women; SCurl products for men; PCJ PrettynSilky & Smooth Roots
children products; YOU unisex products, and Designer Touch products for stylists. Products
offeredbythecompanyincludecosmetics,skincare,haircareproducts,hairstylingirons,hair
stylingtools,humanhair,nailproducts,perfumesformenandwomen,andskincareproducts.
The products are sold nationally and internationally through a dynamic sales force and
numerousretailoutlets.ThecompanysproductsareavailablethroughouttheUnitedStatesin
conveniencestores,food,drug,andmassoutlets,salons,andbeautysupplystores.
Manufacturers level sales in the United States of takehome products are estimated at
$34millionin2012,upfrom$33millionin2011.LusterProductssupportsitsbrandswithTME
of$2.2millionin2012.ThecompanyallocatesitsentireTMEtosupportitsbrandPink.
MARKWINSINTERNATIONAL
Markwins International Corporation was established by Eric Chen, the president and CEO, in
March1984.MarkwinsInternationalmanufacturescosmeticsandbeautycareproductsandis
headquarterednearLosAngeles,CA.Thecompanydistributesitsbeautyproductsinmorethan
85countriesandemploysmorethan150peopleworldwide.Thecompanymarketsmorethan
200 SKUs under its product portfolio. It offers an extensive variety of products, including
products for the eyes, lips, nails, and kits and accessories. The major brands of the company
includeWetNWild,BlackRadiance,Tropez,TheColorInstitute,TheColorWorkshop,TheSpa
Workshop,DisneyPrincess/Fairies/Minnie,Barbie,andMonsterHigh.WetnWildisthemost
recognizedandbestsellingbrandfromthecompany.
In 2012, Markwins International acquires Physicians Formula for $75.0 million or $4.90 per
shareincash.PhysiciansFormula,basedoutofAzusa,CA,develops,markets,anddistributes
cosmetics and skin care products for the mass market channel. The company has 151
employees,anditcompanywasestablishedin1937byDr.FrankCrandall,aneminentallergist,
whocreatedalineofcosmeticsasatokenofloveforhiswifewhohadsensitiveskin.
Markwins International launches a number of cosmetic products in 2012. Some of its major
launchesinclude:
Wet n Wild Color Icon Eyeshadow: It is said to beautifully enhance any eye color and
providesalldaycreaseresistance.
ColorIconShimmerSingle:Thissilkysmoothshimmerstaysforhourswithoutanyfallout,
hashighpigmentationandpearldensityformula.
MegaShieldLipColorSPF15:ItcontainsnaturalingredientsVitaminE,avocadooil,andrice
bran oil that moisturize and condition. With SPF 15, lips are protected from harmful UVB
rays.
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JuicyLipBalmSPF15:TheproductisclaimedtoprotectfromharmfulUVBrayswithSPF15.
MegaLast Nail Color: It comes with a fiveday chipresistant formula and is free from
Formaldehyde,Toluene,andPhthalate.
Inaddition,PhysiciansFormulaintroducesanumberofnewproductsin2012,including:
GlowBoostingSeasontoSeasonBronzer
Ultra Smoothing Blush, 2in1 Lash Boosting FeltTip Eyeliner+Serum, Glow & Mood
BoostingBlush
Glow&MoodBoostingBronzer&Blush
Glow&MoodBoostingLipstick
TalcFreeCorrectingBronzer
TalcFreeMineralAirbrushingPressedPowderSPF30
100%NaturalLashBoostingMascara
pHPowderedBlush,pHPowderedBronzer,andpHPowderedLipGloss
In 2012, the company signs a deal with DMV Diedrichs Markenvertrieb to launch the brand,
WetnWildinGermany.Thecollaborationtargetsdrugandmassretailers.IntheUnitedStates,
Markwins products are sold through food, drug, and mass merchandising retailers, such as
Walgreens,Target,CVS,RiteAid,andWalmartinmorethan25,000doors.
The company is expected to invest in advertising through print and electronic media. It
promotesitsproductsthroughpromotionalmaterials,planograms,andretail/customerevents.
MarkwinsInternationalspends$5.1millioninTMEforallitsbrandsin2012.Thefacemakeup
categoryreceivesapproximately70.1%or$3.5millionofthetotalTME,followedbyskincare
categorywith$1.3millionTMEin2012.Approximately,$4.7millionTMEisspentonmagazine
advertisements.
Global corporate sales for the company are estimated at $490 million in 2012. Sales of
cosmetics and toiletries in the United States at the manufacturers level are approximately
$216million in 2012, up 20.0% from $180 million in 2011. Note that these numbers include
PhysiciansFormulaU.S.salesinbothyears.
MATRISKIN
Dr. Pierre Huet opened Laboratoires ESPA in Toulouse, France, in 1995, to produce various
brands, such as Dr. Sebagh, Meaningful Beauty, and Biotec. He thenestablishedhis skin care
line, Matriskin, in 2006. Matriskin products heal skin imperfections, such as wrinkles, marks,
andstains.Asadermatologist,Huetwantedtheresultsofhisproductstobeimmediateandto
persistonalongtermbasis.MatriskinUSA,asubsidiaryofMatriskin,isfoundedin2012andis
locatedinMiami,FL.
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Matriskin employs the "2nd Skin" technology which is a combination of two patented
molecules,polysaccharidesandceramides.Theresultofthiscombinationisarangeofproducts
thatthecompanyclaimsacttostrengthentheprotectivefunctionofskincellsandrestructuring
ofalllayers.ThecompanymarketscreamslikeCollagenCream,HighPerformanceCream,and
RetinolCapsules,serums,suchasVitaminCSerum5%,HyaluronicAcidGel2%,and10%DMAE
Serum, masks which include HPR Mask Fibronectol and Mask Osmopeel. Its eye care brands
includeNOPADantipuffinessandEyeLiss.
Matriskins brands are promoted on social network sites like Facebook, Twitter, Tumblr,
Pinterest, and YouTube, and magazines such as Elle, People, InStyle, Ultimate, Cosmopolitan,
and Venue. Venus Paradise is the exclusive distributor of the brand in the United States.
Matriskin products are available at online retailers, such as luckyscent.com, ebay.com, and
scentbar.com.
U.S.manufacturerssalesforMatriskinareestimatedtobeunder$500,000in2012.
MERLENORMAN
Merle Norman Cosmetics, based out of Los Angeles, CA, specializes in developing,
manufacturing, and distributing skin care products and color cosmetics. It was founded by
Merle Norman in 1931. The company is currently owned by Chairman Jack Nethercutt,
Norman's greatnephew. The company relies solely on the franchise business to distribute its
products. Merle Norman products are sold exclusively through approximately 2,000
independently owned and operated retail outlets, called Merle Norman Cosmetic Studios, in
the United States, Canada, Mexico, and the United Arab Emirates. The company also offers
purses,sandals,soycandles,sunglasses,readingglasses,giftcards,andperfumes,inadditionto
itsbeautyproducts.
Merle Normans personal care offerings include makeup, fragrances, skin care products, bath
andbodyproducts,andsuncareproducts.ProductsareallsoldundertheMerleNormanbrand
name.
ThenewproductlaunchesbyMerleNormanin2012include:AntiRednessFoamingCleanserto
dissolvemakeupandimpurities;AntiRednessCreamandAntiRednessPowderthatneutralize
the visible signs of redness under the AntiRedness System line; and Ultimate Firming Neck
Cream. The company promotes through social and digital media like Facebook, Twitter, and
YouTube.MerleNormanspends$1.4millioninTMEforitsbrandsin2012.
The manufacturers sales in the United States for cosmetics and toiletries are estimated at
$40millionin2012,down2.5%from$41millionin2011.Growthissupportedbynewproduct
launches.
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MISSJESSIES
MissJessie'swasfoundedin1997byMikoandTitiBranchandislocatedatNewYork,NY.The
company has established its presence in the hair care industry as an innovator in ethnic hair
careproducts.BesidestheUnitedStatesandCanada,thecompanysproductsareavailablein
countries like the United Kingdom, France, Germany, Netherlands, Bermuda, Belgium, and
Bahamas.AliciaKeys,JossStone,HalleBerry,KeriHilson,Rihanna,andRandyJacksonareafew
celebritieswhouseMissJessiesproducts.
The ethnic hair care company markets shampoos, conditioners, and styling brands like Super
SlipSudsyShampoo,CrmedelaCurlCleansingCrme,CrmedelaCrmeConditioner,Rapid
Recovery treatment, and Super Sweetback Treatment. Its styling creams include Pillow Soft
Curls,QuickCurls,StretchSilkeningCrme,CurlyMeringue,CurlyPudding,andUnscentedCurly
Puddingthataddshinetocurls.BabyButterCremeandCurlyButterCremetreatdryhairwith
theirmoisturizingbenefits.Thecompanyannouncestheopeningofitsfirstpublicsalonlocated
in the SOHO area of New York in 2012. Miss Jessies also launches Pillow Soft Curls, a styling
lotionthatdeliverscurlsquickly.
Miss Jessies brands are promoted online through social networking sites, such as Facebook,
Twitter,andYouTubeandbyprovidingproductsamplestoconsumers.IntheUnitedStates,the
productsareavailableatTarget,CVS,andMeijerstores.
Miss Jessies employs a staff of 15 people. The U.S. manufacturers sales of the company are
estimatedtoremainflatat$3millionin2012aswell.Devotingresourcesfornewsalonsand
havingonlyoneproductlaunchin2012hampersitsgrowth.
MURAD
Murad is a private company founded by dermatologist and pharmacist Dr. Howard Murad in
1989. Murad offers a wide range of skin care and hair care products, as well as dietary
supplements. Murad is headquartered in El Segundo, CA, and its products are sold
internationally in approximately 50 countries including the United Kingdom, Canada, Italy,
Brazil, Japan, Chile, and South Africa. Products are distributed mainly through spas, direct
marketing channels, and specialty stores. The major brands of the company include Acne
Complex, Resurgence, Age Reform, Environmental Shield, Vitalic, Redness Therapy, AgeProof
Suncare,CelluliteSolution,MuradMan,Hybrids,andCleanScene.
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The companys skin care line consists of approximately 80 SKUs, including backbar and take
home products. All of Murad's products are formulated with a blend of antiinflammatories,
hydrators,andantioxidantsthatcomefromavarietyoffruits,suchasdurian,gojiberries,and
pomegranates. In the United States, the company markets its skin care products through
infomercials,beautysupplystores(suchasSephoraandUlta),salons,andspas.Thecompany
claimstohavefoundedtheconceptof"InternalSkincare,"orincreasingthebeautyoftheskin
bytakingnutritionalsupplements(salesofwhicharenotincludedinthisreport).
Thecompanycontinuestoextenditslineofproductswithnewlaunches.Thekeylaunchesfor
Muradin2012include:
MuraSol Antioxidant Defense: It comes with an advanced sun care technology that
penetrates the skins top layers to create a protective barrier of free radical neutralizers,
providingawholenewlevelofenvironmentalprotection.
RejuvenatingLiftforNeck&Dcollet:Theproductclaimstorestoreyouthfulsmoothness
andeventone.
Rapid Age Spot & Pigment Lightening Serum: It is free from parabens, synthetic dyes,
petrochemicals, and genetically modified organisms (GMOs). It is said to rapidly lighten
spotsandevenskintone.
Time Release Retinol Concentrate for Deep Wrinkles: Theproduct is specially designed to
effectivelyfocusonthetreatmentofdeepwrinkles.
IntensiveCRadiancePeel:Itisanathomespatreatmentcreatedtoactivelyacceleratethe
turnover of dark, damaged cells. It is free from parabens, synthetic dyes, petrochemicals,
andGMOs.
AgeDiffusing Firming Mask: The product contains a multiactive formula which instantly
tightens,firms,andrevivesdehydratedskin.
The company appoints Beverly Parsons, who joined the company from GuthyRenker in early
2012,aschiefoperatingofficer.
MuradadoptsamultichanneldistributionstrategyintheUnitedStates.Itsproductsaresold
throughspas,physiciansoffices,retailstores,andthedirectsaleschannels.Thecompanysells
its products through more than 2,000 spas and salons across the United States. Murad is
presentinapproximately900retailstores,mostofwhicharecosmeticspecialtystores,suchas
Sephora, Ulta, and Beauty First. In 2011, Murad set up a new franchise system based on its
InclusiveHealthSpaconcept.Itisestimatedthatthereareapproximately10InclusiveHealth
Spasacrossthecountry.Muradhaspartnershipswithalargenumberofthirdpartywebsites
including dermadoctor.com, beauty.com, sephora.com, ulta.com, skincarerx.com, and
skinstore.com, among others. Overall, the direct marketing channels account for more than
onehalfofthebrandssales.
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The brand also has a strong presence in direct marketing. It regularly runs a number of
infomercials,suchastheResurgenceinfomercial,whichithasdonetwoyearsinarow.Murad
also has a popular catalog business and ecommerce platform, offered through HSN. Murad
spends $2.8 million in TME for all its brands in 2012. The company allocates approximately
92.8% or $2.6 million of total TME through magazine advertisements. The global sales of the
company are estimated at $118 million in 2012. Manufacturers level sales of cosmetics and
toiletriesintheUnitedStatestotal$35millionin2012,up2.9%fromunder$34millionin2011.
NATUROPATHICA
Naturopathicawasfoundedbyaclinicalestheticianandherbalist,BarbaraClose,in1995.Itis
headquarteredatEastHampton,NY.Thecompanysdifferentiationreliesonclaimingthatits
extractsofenzymesfromfruitslikepumpkin,cherry,fig,andpearprovidenaturalandeffective
personalcareproducts.
Naturopathicas portfolio consists of skin care (facial cleansers, mists, moisturizers, body
lotion), hair care (shampoo, and conditioner), and oral care products (lip balm). Its skin care
brands include Oat facial polish, Chamomile cleansing milk, Lavender Honey balancing mist,
Geranium regenerating serum, and SicilianBergamot body lotion. Clarifying facialwash, Daily
Defense moisturizer, and Soothing shave cream are products exclusively for men. In 2012,
Naturopathica introduces a limited edition of Black Spruce shampoo and Horsetail hair
conditioner. The company also launches Aloe Replenishment Gel, a treatment mask, and
SicilianBergamotShowerGelin2012.
The company uses social network sites like Facebook, Twitter, Pinterest, and YouTube to
promoteitsbrands.IntheUnitedStates,Naturopathicabrandsareavailableatabout250spas
andsalonsaswellasitsownspainEastHampton,NewYork.
Naturopathica employs a staff of approximately 30 people, most of which work in the spa
services.Thecosmeticsandtoiletriessalesofthecompanyareestimatedat$1millionin2012,
levelwith2011.
NEWHARMONYSOAP
Headquartered in New Harmony, IN, New Harmony Soap was founded in 2012 by Jim and
Stephanie Spann. New Harmony Soap develops bar soaps and bath enhancers composed of
naturalandorganicingredientswhicharedevoidofmanmadeandsyntheticchemicals.Almost
6070%oftheingredientsaresourcedfromoutsidetheUnitedStates.Thecompanysmottois
GetYourSkinOffJunkFood.
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NewHarmonysrangeofproductsincludesbarsoaps(bodybarsandfacebars),bathenhancers
(body soak and chlorine removal), skin repair products, sampler packs, gift sets, and
accessories. Their acne soap which is a premium priced product is a bestseller for the
company. In 2012, the company introduces the Red Wine Soap formulated with reggae red
table wine and Honey Wine Soap formulated with camelot mead honey wine, at the 10th
Annual Wabash Valley Wine & Art Festival in Palestine, IL. New Harmony Soaps marketing
activitiesinvolvesFacebookmarketing,PRdistributionsinvolvingjournalsandpublicationsand
regionalmagazines.NoevidentTMEisallocatedbythecompanyfor2012.
Asof2012,thecompanyhasalimiteddistributionnetworkcomprisingofitsbrickandmortar
store in New Harmony, Indiana and its online store on the company website. Its brick and
mortarstoreaccountsfor70%ofthetotalsaleswhiletheonlinesalesrepresenttheremaining
30%.StartingJuly1,2012,thecompanyinitiatesaprogramtosupporttheMt.VernonIndiana
FoodPantrybydonating5%ofallsalesfromnewharmonysoap.comandintheoutletstoreat
NewHarmony,IN.TheprogramcontinuesuntilSeptember30,2012.
SalesforthecompanyintheU.S.cosmeticsandtoiletriesmarketatthemanufacturerslevel
areestimatedat$150,000in2012.In2013,thecompanyplanstorolloutliquidbodywashes
andestablishawiderwholesaledistributionnetwork.
NOTYOURMOTHER'S
Not Your Mothers was launched in 2010 and the company offers hairstyling products. The
brandsdevelopedbythecompanyhaveuniquepackagingandunconventionalproductnames.
Not Your Mothers hair care portfolio includes products such as Shes A Tease volumizing
hairspray,AllEyesOnMeshape&shinehairspray,MissFreezefreezinghairspray,BeachBabe
texturizing spray, Beat The Heat styling spray, Rise & Shine mist, Kinky Moves curl defining
cream,andGirlPowdervolumizinghairpowder.In2012,thecompanyintroducesWaytoGrow
ShampooandConditioner,whicharesulfatefreeformulations,andKnottytoNicedetangler.
Brands are promoted on social network sites like Facebook, YouTube, Tumblr, Twitter, and
Pinterest In 2012, the company increased its distribution channels and added almost 7,500
retail outlets. Not Your Mothers brands are available in mass merchandiser stores, such as
Walmart and Target, drug stores like CVS and Walgreens, specialty stores, and other retail
stores.Itisalsoavailablewithonlineretailerslikedrugstore.com,soap.com,andamazon.com.
DomesticsalesofNotYourMothersareestimatedat$1millionin2012,anincreaseof11.1%
from2011levelsofabout$900,000.
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NUSKINENTERPRISES
Nu Skin Enterprises is an American multilevel marketing company that sells cosmetics and
nutritionalsupplements.Thecompanywasfoundedin1984inProvo,UT,intheUnitedStates.
The company employees 3,600 people worldwide and operates in 52 international markets
includingAmericas,AsiaPacific,Europe,Africa,andtheMiddleEast.Thecompanymarketsits
products through a sales force of approximately 865,000 active distributors, of which 36,000
aredesignatedasexecutivedistributors.Itdoesnotinvestinanytraditionaladvertisingforits
brands.
The company sells more than 200 products in the personal care and nutritional supplements
categories.InDecember,2011,thecompanyacquiredLifeGenTechnologies,LLC(LifeGen).
NuSkinsproductlinemainlyhasskincareproductswithcustomizedsolutionsandformulated
with botanical ingredients. The companys five different product lines: Core Daily Systems,
Customized Solutions, Total Care, Skin Complements, and ageLOC. Core Daily Systems is
primarilyafacialcarelineandhasfourdifferentlineextensions:Nutricentials,NuSkin180,Tri
PhasicWhite,andNuSkinClearAction.UndertheTotalCareline,thecompanyoffersproduct
categories, such as hand and body lotions, personal cleansing products, mens skin care
products,toothbrushes,toothpastes,mouthwashes,conditioners,andshampoos.
ThecompanydoesnotallocateanysignificantamountofTMEin2012.SalesofNuSkininthe
U.S.cosmeticsandtoiletriesmarketareflatat$25millionin2012,up4.2%from$24millionin
2011.
NYX
Nyx is a manufacturer and supplier of cosmetics products and was established in 1999. This
company was founded by Toni Ko and is headquartered in Commerce, CA. The company
marketseyes,face,andlipmakeupproducts.Nyxemploysaround35people.
Nyx markets products in three makeup categories with products, such as eye shadows, eye
shadow base, mascaras, eye pencils, liquid liners, concealers, palettes, lip gloss, lipstick, lip
liners, blushes, bronzers, powders, and liquid makeup. Some of Nyxs brands include Round
lipstick,Jumboeyepencil,MegaShinelipgloss,Slimlippencil,Mattelipstick,LoosePearleye
shadow, Glitter powder, Doll eye mascara, Mosaic powder blush, Twin Cake powder, Stay
MatteButNotFlatliquidfoundation,andTangowithBronzingStixcreambronzer.
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In2012,Nyxlaunchesapaletteof32eyeshadows,twobrushes,onebronzer,foureyebrow
powders,threeconcealers,andfourlipglossesinakitcalledWaitingforTonightandalineof
shineandshimmercalledTheGlamCollectionwhichincludeslipglossesandliquideyeliners.
The collection has 22 new colors of eye shadow singles, 11 lip glosses called Glam Lip Gloss
AquaLuxe,and9shadesofGlamLinerAquaLuxe.ThecompanyalsolaunchesTheCurveliquid
eye liner, Be Fierce Palette eye shadow, Be Free Palette eye shadow, Bohemian Chic Nude
Matteeyeshadow,andWickedDreamseyeshadow.
Nyx brands are promoted in magazines and publications like Exude, Beauty Store Business,
HollywoodLife,PaintedLadies,InStyle,Seventeen,WomansWorld,Health,Life&Style,Allure,
Happi,BettyConfidential,Glamour,Nylon,andSelf,throughonlineblogs,andonsocialnetwork
sites,suchasTwitter,Facebook,YouTube,andFormspring.Nyxisavailablewithselectretailers
likeUlta,Nordstrom,Sears,Harmon,andBBB.
Total sales of the company are estimated at $4 million in 2012, about the same as the 2011
levels.
ORLANE
Orlanewasfoundedin 1947byJeandAlbret,amakerofperfumesandeaudetoilette.The
company started with the launch of the fragrance, Ecusson. Between 1947 and 1950, the
company created its first cream containing active ingredients and opened its first beauty
institute. Also, during this period the company introduced informative advertising illustrating
thecrosssectionviewoftheskin.In1966,thecompanyunveileditsHouseofBeautyaspace
for women to interact with beauticians and understand the benefits of the products and the
techniques used. The company is headquartered in Paris, France, while its Research and
ProductionCenterislocatedinOrleans.
In 1985, the company was acquired by the Italian Kelemata Group. The Kelemata Group was
foundedbyapharmacistandisnowrunbythefoundersdaughterRaffallaGiraudi,whoisthe
Managing Director, and his son Gian Luca Giraudi, as CEO. The companys U.S. subsidiary,
OrlaneInc.,wasestablishedin1997andisheadquarteredinNewJersey.
In the United States, Orlane markets fragrances, makeup, and skin care products. Orlanes
productsarepopularduetoitsnaturalformulationsbasedonactiveingredients.TheB21Bio
EnergicAntiAgingComplexisthesignatureingredientofallOrlaneskincareproducts.In2012,
thecompanylaunchestheAntiagingOxygenationSystem.
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In 2012, the company gives free miniatures on all online orders above $150.00 and also two
free samples on every order. For a limited time period, Orlane is giving out a 15ml Thermo
Active Firming Night Cream free on the purchase of ThermoActive Firming Cream or Serum.
Orlane uses Facebook as a social platform to launch its new products, inform consumers of
great deals and discounts, and share testimonials of products. Orlanes products are sold
through over 100 doors, including Neiman Marcus, Bloomingdales, and select independent
outlets.
Manufacturers sales in the United States remain flat at $9 million in 2012, up 12.5% from
$8millionin2011.Therearenotraceablemediaexpenditures(TME)recordedforthiscompany
in2012.
ORLYINTERNATIONAL
Orly International, the personal care products manufacturer, was established in 1975 by Jeff
Pink. Orly makes nail lacquers and assorted nail care items which are used internationally in
salons and spas in more than 65 countries. Jeff Pink created the original French manicure to
complementHollywoodstarletsentireonsetwardrobe.ThecompanyisheadquarteredinLos
Angeles,CA.
Orly International is positioned as a professional and natural products company, the latter
becauseofitsprominentformulationwithnotolueneorformaldehydeinitsnaillacquers.The
use of nonfully synthetic chemical formulations and some natural ingredients is carried
forwardfromthecompanysnailcareproductstotheskin careline,whichtoutsingredients,
suchasaloevera,shea,andcocoabutters,andvitaminsAandE.
The companys product portfolio of cosmetics and toiletries includes nail care and skin care
products.Itoffersarangeofproductsundernaillacquercolors,basecoats,primers,topcoats,
hand and foot lotions, and spa kits. Some of the Orly's nail treatment products include the
OriginalFrenchManicure,FungusMD,andCalciumShield.
OrlysproductsaresoldthroughUltasalons,aswellasthroughbeautysupplystores,suchas
Sally Beauty. The company launches a limitedtime nail color collection in partnership with
WarnerBros.PicturesinlinewiththereleaseofDarkShadowsinMay2012. No TMEforthe
companysproductsareevidentfor2012.
ManufacturerssalesofcosmeticsandtoiletriesforOrlyInternationalintheUnitedStatesare
almostflatfor2011and2012,estimatedat$9million.
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OSMIAORGANICS
Osmia Organics was founded by Sarah Villafranco in 2010, and is located at Carbondale, CO.
ThestoreisofficiallyopentopublicsinceApril2012.Sarahstartedhercompanyafterspending
six years as a physician in emergency medicine. The company markets natural and organic
productlinesoffragrances,skincare,andoralcareproducts.Organicbotanicalsareingredients
inalltheproducts.
OsmiaOrganicsfeaturesavarietyofhandmadeorganicsoaps,sensuousbodyoils,andnatural
perfumeswithecoconsciouspackaging.Thecompanyalsodevelopsorganicskincareproducts
like cleansers, exfoliants, moisturizers, and serums. Some of its products include Black Clay
Facial Soap, Aspen Walnut Micro Scrub, Active Gel Nutrient Serum, and HoneyMyrrh Lip
Repair.BestsellersofOsmiaOrganicsareLavenderPineSoap,CoffeeMintSoap,HoneyMyrrh
LipRepair,FacialCalibrationSerum,andJuniperFirePerfume.
ProductsaremarketedonsocialnetworksiteslikeFacebook,YouTube,Pinterest,andTwitter.
Discountcouponsandsamplesareavailableonline.OsmiaOrganicsproductscanbepurchased
onlinethroughthecompanyswebsite.
Domesticsalesofthecompanyareestimatedtobeunder$1millionin2012.
OUIDAD(JHPARTNERS)
Ouidad started her hair salon in 1984 to cater exclusively for curly hair. It is located in New
York,NY,andSantaMonica,CA.Ouidadhaircarebrandsfeatureafoundationforfrizzfighting
resultsfromtheinsideout.In2007,privateequityfirmJHPartners,acquiredOuidad.Termsof
the deal were not disclosed. The executives of Ouidad stayed except for a change in the
companyCEO.
Ouidad markets ethnic hair care products which include shampoos, conditioners, treatment,
styling,andfinishingproductsfordrydamaged,limpthin,frizzy,andnormalhair,aswellasfor
kids. Some of its products include Climate Control defrizzing shampoo, PlayCurl volumizing
shampoo,CurlQuenchermoisturizingconditioner,SunShieldsun&sportleaveinconditioner,
KRLYKidsPump&Gospraygel,MoistureLockdefine&shinecurlstylinggelcream,ShineGlaze
serum,andStylingMistsetting&holdingspray.In2012,OuidadlaunchesSalonSerieswhich
includes Mediterranean Bay Leaf Exfoliating Hair & Scalp Treatment, Omega3 Replenishing
HairTreatment,andBiotinLightweightReparativeHairSerum.Thiscollectionofhairproducts
provides salon results at home for women with all hair textures and styles and is available
exclusivelyatSephora.ItalsolaunchesCurlCoWash,MoistureLockdefine&shinecurlstyling
gelcream,CurlQuencherhydrafusionintensecurlcream,andClimateControlfrizz&flyaway
fighterin2012.
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Thecompanysbrandsarepromotedthroughtelevisioncommercials,onlineblogs,andsocial
networksites,suchasFacebook,Twitter,andYouTube.Ouidadbrandsareavailableinspecialty
storeslikeUltaandSephoraandatmanysalonsnationwide.Ouidademploysaround40people.
Thecompanyisestimatedtogrowat7.1%to$15millionin2012,upfrom$14millionin2011.
Salesgrowthissupportedbytheintroductionofnewproducts.
PALLADIO
Palladio is a private company based in Hollywood, FL, that markets naturalpositioned

cosmetics.Establishedin1999,thecompanydevelopsproductsmadewithvitamincomplexes
(vitaminsA,C,D&E)andcontainingredientssuchasgreentea,chamomile,ginseng,andaloe
vera.Palladioproductshaveantiagingpropertiesthathelptorepairtheskinselasticity.
Palladios makeup products include face makeup, such as Baked Blush, Herbal Liquid
FoundationTubes,andHerbalLiquidConcealers,eyemakeupincludingEyeLinerPencilandEye
shadowPrimer.Thecompanyalsomarketslipsticksandlipglossesandnailtreatments.Itsskin
care products include facial scrubs, facial cleansers, moisturizers, and antiaging creams. In
2012,thecompanylaunchesanewshadeofitsHerbalLipGlossEleventhGorgeous.
ProductsarepromotedonsocialnetworksiteslikeFacebook,Twitter,Google+,andYouTube.
The brand is distributed through beauty supply stores, such as Sally Beauty, and specialty
retailers including Ulta. They are also available at online retailers, such as
discountbeautycenter.com,beautynaturals.com,andcherryculture.com.
Palladioemploysastaffofapproximately15people.U.S.manufacturerssalesofPalladioare
estimatedtoremainflatatjustunder$1millionin2012.
PARFUMSDECOEUR
Based out of Darien, CT, Parfums de Coeur was established in 1981 by Mark Laracy. The
company offers mainly fragrances for the mass market. As of 2012, the company employs
about 100 people worldwide. In September 2012, Yellow Wood Partners private equity firm
acquires Parfums de Coeur, previously a privatelyheld company. The terms of the acquistion
arenotmadeavailable.
Parfums de Coeur offers fragrance, deodorant, personal cleansing, and skin care products
includingbodysprays,moisturizinglotions,bodywashproducts,skinoils,colognesprays,and
deodorants. It has seven different product lines: Body Fantasies, Bod Man sprays, Prince
Matchabelli,SkinMusk,DesignerImposters,SexiestFantasies,andBodyFantasiesVampire.
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In 2012, the company launches two products under the body spray product class: Bod Man
MostWantedandCherryBlossomFantasyscentintheBodyFantasiesline.
Thecompanyoffersitsproductsthroughchaindiscountersanddrugstores,aswellasthrough
itswebsite.ParfumsdeCoeurapportions$2millionofTMEin2012.Itadvertisesitsfragrances
throughtelevision.
TotalsalesforthecompanyintheU.S.cosmeticsandtoiletriesatthemanufacturerslevelare
estimatedat$23millionin2012,upfrom$22millionin2011.
PERIOPRODUCTS
Perio Products Company, a marketer and distributor of personal care products, is

headquarteredinDublin,OH.Thecompanyhastwomajorpersonalcarebrands:Barbasoland
PureSilk,whichareundertheshavingproductscategory.
Perio Products started as a dental care company, Columbus Dental, in 1903. The company
becameFranklinDentalin1981afterthesuccessofitsSteelefacings,individualreplacement
teethwithgoldorsilverbackings.Thecompanyshifteditsfocusfromdentistrytoshavingafter
itacquiredhairremovalbrands,NuditandHersin1997.
In2001,PerioacquiredBarbasolfromPfizer,whichstrengthenedthecompanyspersonalcare
portfolio.In2003,thecompanysshavingproductsassortmentwasstrengthenedwiththere
launch of Pure Silk, Barbasols sister brand, designed specifically for women. The shaving
productscategorydominatesthepersonalcareofferingsofthecompany.TheBarbasolrangeof
productsincludesshavingcreamsandaftershaveliquidandbalm.Someoftheshavingcreams
includeBarbasolOriginal,BarbasolPacificRush,BarbasolSoothingAloe,andBarbasolSensitive
Skin, whereas, the after shave segment includes Barbasol Pacific Rush, Barbasol Brisk, and
BarbasolPacificRushPremiumaftershavebalm.ThePureSilklineisrestrictedtotheshaving
products category. In 2012, Perio Products launches Barbasol Sensitive Skin shaving cream,
Barbasol Arctic Chill shaving cream, Barbasol Mountain Blast shaving cream, Barbasol Pacific
RushPremiumAfterShavebalm,andPureSilkKiwiBerryBlissshavingcream.
Barbasol signs a fiveyear agreement with Columbus Crew, a major soccer league club, to be
theirofficialjerseypartnerinFebruary2012.BarbsaolsponsorsthePGATour,web.comTour,
and Champions Tour for professional golfers, whereas, Pure Silk sponsors nine LPGA tour
members,suchasKatherineHullKirkandJeongJang.
The companys products are sold in major food stores, drug stores like Walgreens, and mass
merchandisechains,suchasWalmartandTarget.PerioProductsallocates$9millioninTMEfor
2012.
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Manufacturers sales for cosmetics and toiletries in the United States are estimated at
$20million in 2012, up 11.1% from $18 million in 2011 based on new product launches and
marketingactivities.
PERRICONEMD
Founded in 1998 by renowned dermatologist Dr. Nicholas V. Perricone, Perricone MD is a

private company located in Meriden, CT. TSG Partners, a private equity firm based in San
Francisco,CA,isthemajoritystakeholderinthecompany.Thecompanywaspreviouslycalled
N.V.Perricone,butwasrenamedasPerriconeMDin2008.Itusescontractmanufacturersfor
manufacturingitsproducts.
The company offers skin care products and markets antiaging skin care products, as well as
books, DVDs, and vitamin supplements. Products are formulated with antiaging skin care
ingredientsthatprovideremedytodullskin,antiagingskin,hyperpigmentation,damagedskin,
acne,oilyanddryskin,andsensitiveskin.Thebrandspremiseisbasedonaddressingskinaging
andinflammation.
The companys bestselling products include its Citrus Facial Wash, High Potency Evening
Repair,AdvancedEyeAreaTherapy,andFaceFinishingMoisturizer.
In2012,thecompanylaunchesFormula15,ahighlyadvancedformulationoftheoriginalFace
FirmingActivator,designedtominimizethelength,depth,andwidthofawrinkle,andrestore
skin to its youthful suppleness and glow. It also introduce two skin care products, Acyl
GlutathioneEyeLidSerum,totightenandfirmtheuppereyelidarea,whilesmoothingcreases
andimprovingtheappearanceofrednessanddarkcircles,andVitaminCEster15tohelpboost
collagenproduction,smoothenskintexture,andbrightenitsappearance.
Nationwide distribution is through retail stores, including Sephora, Saks Fifth Avenue,
Nordstrom,NeimanMarcus,Bluemercury,andHenriBendel.Thecompanyhasitsflagshipretail
store at Madison Avenue in New York City and Malibu in California. Products are also sold
through phone and through the companys online shopping portal. Perricone MD promotes
throughsocialanddigitalmedialikeFacebook,Twitter,andYouTubebyprovidinginformation
on new product launches, online deals, explaining beauty techniques, and providing tips on
healthyliving.TheTMEforPerriconeMDareestimatedat$7.1millionin2012.
ThemanufacturessalesforPerriconeMDintheUnitedStatesforcosmeticsandtoiletriesare
estimatedat$84millionin2012,up6.3%from$79millionin2011duetonewproductlaunches
madeintheyear.
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PIERREFABREGROUP
The Pierre Fabre Group is a pharmaceuticals and cosmetics company based in France. The
companywasfoundedin1961bypharmacist,PierreFabre.Thecompanyhasaglobalpresence
across five continents. Globally, the company has a workforce of 10,000 employees. Pierre
Fabres operations are divided under two segments: DermoCosmetics and Pharmaceutical.
PierreFabreDermoCosmtiqueUSAisawhollyownedsubsidiaryofPierreFabreGroupandis
responsible for marketing and distributing cosmetics and toiletries products in the United
States.ThecompanysU.S.headquartersarelocatedinParsippany,NJ.
The Pierre Fabre Group is represented by Avne, Ren Furterer, A Derma, Ducray, Elancyl,
Galnic, and Klorane cosmetic brands across the world. However, in the United States, the
companyisrepresentedonlybytheAvneandRenFurtererbrands,whichfindpresencein
theskincareandthehaircareproductclasses.
The Avne brand was introduced in 1989. All Avne products are formulated with the Avne
Thermal Spring Water, which the company claims to have a balanced mineral composition.
AlthoughAvneisprimarilyafacialtreatmentsbranditalsooffersbodycareproducts,suncare
products,andskincareproductsformen.Avneproductsareespeciallydesignedtotreatall
types of sensitive skin care concerns, such as skin redness, sensitive and intolerant skin,
dehydratedskin,andalsooffersproductsforwoundcare.In2012,thebrandintroducestheD
Pigment Light, a light formula that is enriched with shinereducing powders and is known to
reduce and prevent dark spots after four weeks. The brands bestselling products include
Thermal Spring Water, Cleanance Gel Soapless Cleanser, Cold Cream Lip Balm, Soothing
MoistureMask,GentleToner,Rtrinal+0.1Cream,andHighProtectionTintedCompactBeige.
AvnesPRactivitiesincludewriteupsinfashionandbeautymagazines,suchas,Allure,InStyle,
People Style Watch, Marie Claire, Essence, O, The Oprah Magazine, New Beauty, TeenVogue,
Town & Country, Self, and Vogue. The brand is also highly active on social media networks
includingFacebook,Twitter,Pinterest,andYouTubewithcontests,giveaways,andtipsofthe
day.
Avnes line of skin care products is available through online retailers, dermstore.com,
drugstore.com, and skinstore.com; massmarket retailers and drug stores including Duane
Reade, Soho Pharmacy, Walgreens, Grove Pharmacy, K&B Cosmetic Beauty, Pure Essentials,
WindsorPharmacy,PasteurPharmacyanddoctorsoffices.
RenFurtererisanaturallyformulatedhaircarebrandthattreatsboththescalpandthehair.
ThelineiscreatedbytheFrenchstylistRenFurtererandismadefrompureessentialoilsand
plantsfromallovertheworld.ThebrandhasbeenapartofthePierreFabreGroupsince1980.
In 2012, Ren Furterer launches the Okara Active Light range comprising a shampoo,
conditioner,andaleaveinfluid.
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RenFurterersproductsarefeaturedinmagazinesincludingAmericanSalon,Allure,InStyle,US
Weekly,BeautyLaunchpad,Cosmopolitan,WholeLiving,USWeekly,andPeople.Thebrandalso
promotes its products on Facebook and Twitter with snapshot uploads of the products being
usedatrunwayevents,suchastheNewYorkFashionWeek.Thebrandholdseventssuchasthe
Ren Furterer Art and Science of Hair dressing event to educate consumers on the latest in
fashion and trends with respect to hairstyles. The company invests very minimally in TME in
2012.
RenFurtererproductsaredistributedthroughhighendsalonsandspas,suchasPatriceVinci
Salon, Roffi Salon & Spa, and department and specialty stores, such as Bloomingdales and
Sephora. The brand is also associated with professional partners who receive exclusive
promotionsandoffers.
Manufacturers sales in the United States are estimated to grow at 7.1% from $14 million in
2011toreach$15millionin2012.
PRESTIGECOSMETICS
Prestige Cosmetics was established in 1987, by two brothers, Jacques and Gabriel Cohen.
Prestige Cosmetics is a privatelyowned comapany that manufactures and markets color
cosmetics.ItsheadquartersandproductionfacilitiesarelocatedinPompanoBeach,FL.As of
2012,thecompanyemploys55workersintheUnitedStates.Itprimarilytargetsconsumersin
theagegroupof25to35years.Thecompanyhasastrongcolorcosmeticsrangeconsistingof
over300productSKUs.
Thecompanysproductofferingsincludelipsticks,lipliners,lipglosses,eyeshadows,eyeliners,
mascaras, powders, blushers, foundations, nail polishes, and makeup brushes. Prestige
CosmeticsoffersmakeupunderthePrestigebrandandunderprivatelabelsforretailers.
PrestigeCosmeticshasastrongdistributionnetwork.Ithaspresenceinnearly12,000retailers
in the U.S. market and 17,000 retail points worldwide. The company markets its products to
drug stores, mass merchandisers, supermarkets, and specialty retailers in the United States.
Outside of the United States, it sells its products to distributors in Australia, Canada, South
America,Europe,andAsia.
The company does its promotion and marketing through various social media sites which
includeFacebookandTwitter.NoevidentamountofTMEisspentbythecompanyin2012.
Mnaufacturers sales of cosmetics and toiletries in the United States are estimated at
$10million in 2012, down by 9.1% from $11 million in 2011. The sales reported here include
onlythePrestigebrand,andexcludesprivatelabelsales.
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PRIMALELEMENTS
HeadquarteredinGardenGrove,CA,PrimalElementswasfoundedbyFaithandScottFreeman
in 1993. Primal Elements is a privatelyheld manufacturer, marketer, and retailer of personal
careandhomecareproducts.Thecompanyhasover40employeesandusesamanualprocess
tocreatePrimalElementsHandmadeVegetableGlycerinSoaps.
The company began from a bath, body, and aromatherapy shop in Belmont Shore, CA to
expand its product base to include home and personal fragrances in 1999. The companys
offering falls into personal cleansing products, hand and body lotions, shampoos, fragrances,
andhomefragrancescategories.
In 2012, timed with the U.S. Presidential elections, the company makes limited edition
Republican and Democrat Soaps, featuring each partys political symbol. The company also
makes limited edition bar soaps and candles for special occasions, such as Halloween,
Thanksgiving,BreastCancerAwarenessmonth,andNationalHoneyMonth.Also,in2012,the
companyintroducestheLePinklipglossandFoamingHandwashesavailableinsixfragrances.A
fewofthecompanysbestsellingproductsincludeArielBarSoap,OrangeCantaloupeBarSoap,
andFacetsoftheSeaBarSoap.
AccordingtoPrimalElementsCustomProductsProgram,thecompanywelcomesrequestsfor
soapcustomizationaccordingtocolor,designs,andfragrances.
Primal Elements products are also featured regularly on HSN and beauty magazines, such as
Happi, GQ, and Spa Magazine. The company is socially active on Facebook and Pinterest. It
doesnotinvestintraditionaladvertising.
PrimalElementsproductsareretailedthroughmorethan11,000storesnationwideincluding
highendretailchains,suchasNordstrom;salon,suchasElizabethArdenRedDoor;specialty
storesandgiftshops;andhotelsandspas.Thecompanysproductsarealsoavailablethrough
online retailers, such as drugstore.com, soapmaking.com, rosnersoap.com, and
thesoapopera.com.
Manufacturerssalesofthecompanyinthecosmeticsandtoiletriesindustrypostagrowthof
11.1%in2012to$10millionfrom$9millionin2011.
PRMINERALS
PrMineralsisalineofcolorcosmeticsthatprovidesskincaretreatmentsatthesametime.
The company was founded in 2002 and is based in Atlanta, GA. Its products claimto nourish
andconditionskinwhileeveningoutskintone.Theproductsofferpurepigmentcolorswhich
suitallskintonesandskintypes.ItoperatesasasubsidiaryofAstralBrands.
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Pr Minerals products are made using ceretin complex, shea butter, and antioxidants. Pr
Mineralsproductportfoliomarketsmakeupandskincarebrands.Itsmakeupproductsinclude
facemakeuplikeprimers,foundations,powders,eyemakeupsuchaseyeshadows,mascara,
eye pencils, and lipsticks and lip glosses. Some of its makeup products are Universal Marble
Mineral Powders, Pressed Mineral Eye Shadow Singles, and Pout Plumping Lip Gloss. Its skin
careproductsincludecleansers,moisturizers,masques,serums,andbodylotions.Someofits
skincareproductsareLiteBodyButter,MineralMuddMasque,FulvicMineralMist,andTone
Upeyetreatment.In2012,thecompanyintroducesPerfectFitEyeShadowTrios,BalancingAct
OilControlPowder,andarangeof4in1productslike4in1LiquidFoundation,Disappearing
Act4in1Concealer,and4in1MineralTintedMoisturizer.
Social network sites, such as Facebook, Twitter, Tumblr, YouTube, and Pinterest are popular
promotional mediums employed by the company to advertise its products. Pr Minerals
brands are available in specialty stores, department stores, and at select drug stores in the
UnitedStates.
Thecompanyhasaround70employeesasitsworkingstaff.DomesticsalesofPrMineralsare
estimatedat$5millionin2012,upby25%from$4millionin2011.Salesgrowthissupported
bytheintroductionofnewproducts.
PURE&BASIC
Pure& Basic is a manufacturer and marketer of natural personal care products, and is
headquarteredinCarson,CA.Thecompanywasfoundedin1971byThomasDionisio.Pure&
Basics production and warehouse facilities are located at Carson, CA, and its products are
distributedintheUnitedStatesandCanada.
Pure& Basic markets personal care, hair care, and skin care products. Its range of products
includehandandbodylotions,bathandbodywash,barsoaps,shampoos,conditioners,hand
soaps,vitaminEoils,anddeodorants.SomeoftheproductsfromPure&BasicincludeHoney
SheaButternaturalbarsoap,CaribbeanHeatbodywash,andGreenClaydeodorantstick.
The company has changed its distribution network over the last few years. Its products are
distributedinover12,000independentretailoutletsincludinghealthfoodstoresandsmallco
operatives in the United States and Canada. Pure & Basic products are sold through online
retailersaswellasthroughretailerslikeTJMaxxandMarshalls.
Thecompanyhasnoproductlaunchesin2012.Itpromotesthroughsocialanddigitalmedialike
Facebook and YouTube, by informing about new product launches, and providing details on
benefitsandusageofitsproducts.ThecompanydoesnotallocateanyTMEin2012.
Pure&Basicssalesin2011and2012remainalmostflat,atapproximately$9million.
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RAHUA
Rahua by Amazon Beauty is a hair treatment collection that combines organic and natural
ingredients with extracts found in the Amazon. Based in New York, NY, the company was
createdbyhairdresserFabianLiguinin2008.AmazonBeautypartnerswiththetribalwomenof
Amazontosourceandprocessessentialoilsinaccordancewiththetraditionalmethods.
ThemainingredientofallhaircareproductsistheoilfromRahuanut.Thecompanyclaimsthat
Rahua oils small molecular structure enables it to penetrate deep into the hairs cortex and
makes the hairs cuticle smooth. The company markets products, such as shampoos,
conditioners,hairmasques,andhairsprays.In2012,RahualaunchesRahuaOmega9HairMask
whichcontainsungurahuaoil,whichissaidtoinjecthairrootswithlifeandshine.
ProductsarepromotedonsocialnetworksiteslikeFacebookandTwitter.Rahuasproductsare
available in highend department stores, such as Barneys New York, retail stores like
Anthropologie, at various spas and salons nationwide, and with online retailers like
beautybar.com,skinstore.com,dermstore.com,betterbeauty.com,andsaffronrouge.com.
Domesticsalesofthecompanyareestimatedatlessthan$1millionin2012,constantat2011
levels.
RECKITTBENCKISER
ReckittBenckiser,headquarteredatBerkshire,theUnitedKingdom,wasformedasaresultof
the 1999 merger between the United Kingdoms Reckitt& Colman and the Dutch group,
Benckiser.IntheUnitedStates,itisheadquarteredinParsippany,NJ.
Reckitt Benckiser groups together brands of a variety of products across different product
segments. It is one of the global leaders in the manufacture and sales of household cleaning
products. The company markets a large collection of OTC and personal care products. The
companys OTC line strengthened after it completed the acquisition of Boots Healthcare
International,aglobalhealthcarecompany,in2006.Thecompanyisalsopresentinthefood
sector,andmarketssauces,crisps,andmustards.
The company has operations in nearly 60 countries and sells its products in more than 180
countries.BartBecht,theCEOofthecompanyfor16years,leftReckittBenckiserinSeptember
2011andwasreplacedbyRakeshKapoor.ThecompanysellstheParaspersonalcarebrandsto
MaricoLtd.,inFebruary2012,afteracquiringitfor$730millioninApril2011.
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Reckitt Benckiser competes under facial treatments, mouthwashes, personal cleansing

products,anddepilatories,waxesandbleaches.Veet,oneoftheleadingdepilatorybrands,and
Clearasil, the skin care and acne treatment brand dominate the companys personal care
portfolio. Veet was launched in Canada in 1901, and was previously named Neet. It has a
presence in nearly 180 countries and its product range comprises two major products types:
hairremovalcreamsandlotionsandwaxproducts.Inmouthwashes,thecompanymarketsthe
Cepacolbrand.
Productsaresoldnationwidebymajorfood,drugstore,andmassmerchandisechainsincluding
Walmart,Walgreens,andKmart.Itpromotesthroughvarioussocialanddigitalmediawebsites
likeFacebook,Twitter,Linkedin,YouTube,Google+,andWeibo.In2012,thecompanyallocates
aTMEof$3.6millionforitsbrands.
Reckitt Benckisers sales in the United States for cosmetics and toiletries are estimated at
$80million in 2012, up 1.3% from $79 million in 2011 because of the strong brand base and
widedistribution.
RENCLEANSKINCARE
Founded in 2000, Ren is a British skin care company that claims to use hightech plant and
mineral derived bio actives in its product formulations, which are devoid of skinirritating
ingredients. The company was founded by Robert Calcraft and Antony Buck and is
headquarteredinLondon,theUnitedKingdom.However,itsU.S.corporateofficeisincentral
NewJersey.
Rens product offerings are distributed across facial treatments, hand and body lotions, sun
care products, skin care products for men, shaving products, personal cleansing products,
shampoos,andconditioners.Thecompanyalsoofferstravelandgiftsets.
In2012,RenintroducesavarietyofskincareproductsincludingtheKeepYoungandBeautiful
AntiAging Eye Creaman ultra lifting, firming, and replenishing eye cream that reduces the
appearanceoffinelinesandwrinkles;PhotoactiveSunVeilSPF15,atripleactionmicromineral
sunscreenthatdeliversbroadspectrumUVAandUVBprotectionandfightsfreeradicalstogive
aradiantandtonedappearancetotheskin;ClarifyingToningLotion,anexfoliatinglotionsthat
unclogsporesandhelpsremovedeadskinand;BioRetinoidAntiAgingConcentratetoincrease
collagenproductionby24%andreducetheappearanceoffineslinesandwrinklesforafirmer
andradiantskin.
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Ren skincare products find regular mention in fashion and beauty magazines including Elle,
Stella, Beauty Magazine, So Feminine, The Guardian, Wedding Venues, Natural Health, Bella,
InStyle,Metro,Grazia,andSpaSecrets.Renhasanactivesocialmediapresencewithanofficial
YouTubechannelandpresenceonFacebookandTwitter.In2012,themarketerteamsupwith
Swedishsparetreat,HotelTylsandtogivetwoRenproductloversachancetowinaninclusive
nightstayatthespa.NoTMEforthecompanysproductsareevidentin2012.
IntheUnitedStates,RensproductscanbefoundinSephorastores.In2012,manufacturers
sales for the company are estimated at $7 million, up 16.7% from $6 million in 2011. The
growthin2012isprimarilyattributedtotheintroductionofnewproductstoitsalreadyexisting
productline.Thecompanyhasalsosteppedupitsmarketingin2012.
ROHTOPHARMACEUTICAL
HeaquateredinOsaka,Japan,RohtoPharmaceuticalspecializesindeveloping,manufacturing,
and distributing ophthalmic medicines. The operations are carried out through the following
divisions:SkinCareProducts,EyeCareProducts,OralMedicine,andOther.Thecompanyhasits
business in domestic markets as well as in overseas markets, including Europe, Asia and
America. As of March 31, 2012, the company has 32 subsidiaries and seven associated
companies. Worldwide,the company has 5,347 employees. The Rohto Group has established
23companiesworldwidewithproductsavailabletoconsumersinmorethan130countries.
TheU.S.businessishandledbyitswhollyownedsubsidiary,TheMentholatumCompanyInc.It
specializes in the manufacturing, marketing, and distribution of nonprescription drugs and
consumerhealthcareproducts.ThecompanyisheadquateredinOrchardPark,NY.
Thecompanyscosmeticsandtoiletriesrangecomprisesskincareandoralcareproducts.Lip
balms, jellies, and treatment products account for more than 70% of its revenues in this
segment.Inthelipbalmsandjelliescategory,productsareofferedundertheproductnames
SoftlipsandNaturalIce.TheSoftlipsproductrangeconsistsof28productSKUsthatarespread
under seven different lines: Organic Lip glosses with Sun Protection Factor (SPF 10), Lip balm
flavors with SPF 20, Therapeutic Lip conditioners, Tinted Lip Balms with SPF 15, PURE 100%
Natural Organic Lip balm flavors, PURE 100% Natural Specialty Lip Products, and Limited
EditionsSeasonalflavorswithSPF20.
In the skin care segment, the company offers facial treatment lines pHisoderm and Oxy. The
pHisoderm line includes mainly facial cleansers and moisturizers. Under the Oxy line, the
company primarily markets acne products that are specially targeted towards younger
audiences.Thelineisalsoextendedtoincludepersonalcleansingproductsandshavingcreams.
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Distribution is nationwide through major food, drug, and mass merchandise chains, including
CVS, Fred Meyer, Rite Aid, Safeway, Target, Walmart, and Walgreens. Rohto Pharmaceutical
spendsaminoramountofTMEthisyear.Thecompanyconductsonlyonetypeofadvertisingin
2012:atelevisionspotforitspHisodermPH2OEverydayMoisturizer.
Manufacturers sales of cosmetics and toiletries in the United States are estimated at
$31millionin2012,flatfrom2011duetothelackofpromotionalactivities.
ROSEBUDPERFUMECOMPANY
The Rosebud Perfume Company was founded in 1895 by George F. Smith. Originally, the
business started out from a drug store that is located across the present Rosebud building
Woodsbro,MD.Dr.SmithcameupwiththeBalsamofRosebudsuponsuggestionsfromfriends
andfamily,whichwaslaterrenamedasRosebudSalve.
The companys product offerings include moisturizing lip balms, jellies, and treatments. Its
balms are available in a variety of flavors and packaged in the conventional balm boxes or
tubes.
The company has a limited distribution network with products available for purchase at
Sephora, Amish Creek, Urban Outfitters, Anthropologic, Terrain, American Apparel, Pharmaca
Integrated Pharmacy, Walgreens New Mexico; and online retailers, such as drugstore.com,
beauty.com, and amazon.com. No significant TME have been reported for the company in
2012.
In 2012, the companys sales in the U.S. cosmetics and toiletries market are estimated at
$5million,steadyfromthe2011sales.
SHAKLEECORPORATION
Privately held since its inception in 1956, Shaklee Corporation specializes in the manufacture
anddistributionofvitamins,cosmetics,personalcare,andnutritionproducts,aswellasgreen
household cleaners. It manufactures its privatelabel products and markets them through its
website, and sales representatives in the United States, Canada, Mexico, China, Japan,
Malaysia,andTaiwan.
TheU.S.basedfirmisheadquarteredinPleasanton,CA.FoundedbyDr.ForrestC.Shaklee,Sr.,
the company is owned by private equity firms, Ripplewood Holdings and Activated Holdings.
Thepartnershipjointlyholdsmorethan80%ofthecompanystotalshares.
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IntheUnitedStates,thecompanyhasnearly500employees.Productioniscarriedoutinthe
companysheadquarters,locatedatPleasanton,CA.
The companys personal care business comprises six product lines, which includes Cleanse,
Neutralize, Enfuselle Advanced Skin Care, ProSante Hair Care, Daily Essentials, Beauty
accessories,AdvancedMoisture,SpecificTreatmentsRepair,andBodyCare.
The company does not spend any evident amount of TME in 2012. Manufacturers sales of
cosmetics and toiletries in the United States are at $30 million in 2012, unvarying from 2011
levels.Flatsalesarearesultoflackofnewprodcutactivityfromthecompany.
SISLEYCOSMETICS
Based out of Paris, France, Sisley Cosmetics specializes in the manufacturing, marketing, and
distributionofluxuryhaircare,makeup,fragrances,andskincareproducts.Thecompanyhasa
separatelineformenwhichincludesfragrancesandskincareproducts.Itwasstartedin1976
by Count Hubert dOrnano, and the privatelyowned company is still run by the dOrnano
family.
The U.S. subsidiary, Sisley Cosmetics USA Inc. was started in 2003. The companys U.S.
headquarters are located in New York City, NY. As of 2012, the company has over 4,000
employeesworldwide.IntheUnitedStates,ithasover150personnel.MostofSisleysproducts
are manufactured in France, mainly in its Blois plant, while its Research and Development
laboratoriesarelocatedjustoutsideParis.Thecompanyhasaround30subsidiarycompanies
anddistributionofficesoperatinginnearly80countriesaroundtheworld.
Sisley Cosmetics offers a comprehensive range of personal care products ranging from color
cosmetics to hand and body lotions, hair care, fragrances, facial treatments, and sun care
products.Sisleyoffersover220productSKUs.ItsSisleyaGlobalAntiAgeCreamisoneofthe
most expensive skin care creams on the market, at $475.00 for 1.7 ounces. New products
introducedduring2011areSkinleya,anantiagingliftfoundationandBlackrosecreammask.In
2012,thecompanylaunchestwomoreproductswhichincludesPhytoBlanclighteningserum,
consistingofactivelighteningcomplex,andSisleaConcentrAntiAgeFermetCorps,thefirst
globalantiagingskincareforthebodybySisleyCosmetics.
The company distributes its products through department stores, perfumeries, beauty
institutes,andalimitednumberofpharmacies.SisleyCosmeticsallocatesaTMEof$210,900in
2012. It invests in magazine advertising in the United States in 2012 for it skin care and
cosmeticproducts.
ManufacturerslevelsalesintheUnitedStatesareapproximately$11millionin2012,up10.0%
from $10 million in 2011, mainly driven by the new prodcut launches under the skin care
category.
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SMELLBENT
BrentLeonesio,aformerdesignerforCynthiaVincent(afashiondesigner),startedSmellBent,a
perfumecompany,withacollectionof10scents.BasedinWestHollywood,CA,thecompanys
earliest edition of fragrances was introduced in 2009. Smell Bents perfumes are available in
sprays and oil format. The company combines scent and art and uses childlike graphics for
packaging all perfumes. The company prices its brands at mass rates in order to approach a
broaderaudience.
SmellBentdevelopsaround59SKUsandallproductsarepricedbetween$20.00and$45.00.
Thefragrancesareclassifiedintodifferentcollections,suchasclassiccharacters,leisurecruise,
spray exclusives, vocabulary, limited edition, and sunset people. Bestsellers of the company
includeBollywoodandPrairieNymph.In2012,twocollectionsareintroduced:Vocabularyand
SunsetPeople.TheVocabularycollectionincludesbrandslikedry,floral,green,citrus,woody,
musky,andcompletistandSunsetPeopleincludesbrands,suchasDiscoNap,LadyGogo,Tipsy
SocialBlahBlah,MirrorBall,andWalkofShame.TheSmellBentbrandsarepromotedthrough
social networking sites like Facebook, Twitter, Tumblr, and YouTube. Online blogs are other
promotional mediums. Fragrances can be ordered at the company website, luckyscents.com,
ebay.com,andscentbar.com.SmellBentisestimatedtogrowat33.3%from$3millionin2011
to$4millionin2012.Salesgrowthissupportedbytheintroductionofmanynewfragrancesin
2012.
STEINERLEISURE
Headquartered in Nassau, the Bahamas, Steiner Leisure Limited is a global provider of spa
servicesandoperations.Thecompanymanufacturesanddistributespremiumskin,body,and
haircareproducts.Itisalsoanaccreditededucator,teachingstudentstheskillsnecessarytobe
a spa professional, including massage, skin care, and spa management. The company has
approximatelyover7,300employeesworldwidein2012.
ThecompanysMaritimeandResortSpadivisionsoperateinover210venuesonlandandat
sea. In November 2011, the company acquired Ideal Image Development, a leader in the
cosmetichealthcarecategoryoflaserhairremovalfor$175million.
The company operates in three reportable segments: Spa Operations, which provides spa
services onboard cruise ships, at hotels, and at spas. It sells its products through six brands
including Elemis, Bliss, Remde, La Thrapie, Mandara Spa, and Mandara. Its product lines
include cleansers, toners, moisturizers, lotions and other skin care products and cleansing
accessories, waxing and other body products, as well as aromatherapy oils, shampoos,
conditioners,andstylingproducts.
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Thecompanysellsitspersonalcareproductsthroughdepartmentstores,throughotherthird
party retail outlets and distributors, as well as through salons and websites, including
www.timetospa.com, www.blissworld.com, and www.bodyworkmall.com. It also markets its
products through the QVC home shopping television channel. Steiner Education Group
operatesschoolsat30campuseslocatedinArizona,Colorado,Connecticut,Florida,Maryland,
Nevada,Pennsylvania,Utah,andVirginia.Offeringprogramsinmassagetherapyand,insome
cases, skin care, these schools train and qualify spa professionals for health and beauty
positionswithintheSteinerfamilyofcompaniesorotherindustryentities.
Totalcorporatesalesfor2012areapproximately$770million.Salesofcosmeticsandtoiletries
intheUnitedStatesareapproximately$31millionin2012,upfrom$30millionin2011.Steiner
LeisurehasnegligibleTMErecordedin2012.
SUEISMIEL&DAUGHTERS
Sue Ismiel& Daughters specializes in the manufacturing, marketing, and distribution of hair
removal products, health supplements, and hair treatments products. The company is
headquarteredatBaulkhamHills,NSW,Australia.Thefamilyownedcompanyhasthreebrands:
Aussies Nad, a hair removal product; Wyld, a natural health supplement; and Nitwits, a lice
treatmentproductforhair.
AussiesNadwasestablishedin1992byCEOSueIsmiel.ThecompanysU.S.headquartersare
located at Torrance, CA. Aussies Nad accounts for a large portion of the companys overall
revenues.In2012,AussiesNadcelebratesits20thanniversary.Theproductsaredistributedin
Australia,NewZealand,theUnitedStates,Canada,andtheUnitedKingdom.
The companys personal care offerings comprise naturalinspired hair removal products.
Products are classified under two separate lines, Nad For Men and Nad For Women. In the
mensline,thecompanyoffersproducts,suchashairremovalcreamsandhairremovalstrips.It
alsooffersproducts,suchasIngrowSolutions,acreamwhichhelpstoeliminateingrownhair,
razorburns,andshavingrashes.Hairremovalproductsforwomenincludehairremovalcreams
andhairremovalstripsasitsmainofferings.Alltheproductsfallinthecategoryofdepilatories,
waxes,andbleaches.
In2012,thecompanylaunchesNoseWaxformenandwomenunderitsNadsbrand.
Products are sold through 35,000 retail points including food, drug, and mass merchandising
storesnationwide.SomeoftheselectedretailchainsareTarget,Kmart,CVS,andRiteAid.The
brandisalsosoldthroughinfomercials.
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ThecompanyallocatesaninsignificantamountofTMEin2012.Asidefromprintadvertisingin
magazines,thecompanydoesitspromotionthroughvarioussocialmediasiteswhichinclude
Facebook,TwitterandYouTube.
SalesintheUnitedStatestotal$10millionin2012,constantat2011levels,mainlyduetostiff
competitionin2012.
SUNDAYRILEY
SundayRileyisawomanwholaunchedherownantiagingskincarelinein2009.Thecompany
isheadquarteredinHouston,TX.Alltheproductsaremadebyacombinationofbotanicalsand
biotechnology.ThemainingredientofallproductsisNV5AgelessComplex.Itisablendoffive
NativeAmericanbotanicalsthatprovidecellularhealing,detoxification,andregeneration.
Sunday Rileys skin care product portfolio includes brands, such as Charisma Crme Cleanser,
Stimulant I Perfecting Stem Cell Serum for wrinkles, Good Genes treatment mask, Juno
TransformativeLipidSerumforradiance,Bionicantiagingcream,CashmereSPF30,StartOver
eyecream,BeyondBodyLotion,andBodyLipidSerum.
Sunday Riley promotes its products on social network sites, such as Facebook, Tumblr,
YouTube, and Twitter. The companys brands have nationwide presence in highend
departmentstoreslikeBarneysNewYork,BergdorfGoodman,SpaceNK,specialtystoressuch
asSephora,andonlineretailerslikenordstrom.comanddermstore.com.
ItisestimatedthatSundayRileyemploysfourpeopleanditscorporatesalesfor2011areat$1
million.Salesarerelativelyflatin2012aswell.
SUNSTAR
BasedoutofOsaka,Japan,Sunstarwasfoundedin1946andisapubliclyheldmanufacturerof
oral care, hair care, and skin care products. It also sells health foods, household products,
constructionmaterials,andmaterialsforindustrialuse.
Thecompanyhas3,966employeesworldwideandtotalsalesof$1,141millionin2012.Itsoral
care division accounts for 81% of the total revenues. Sunstar has 22 subsidiary companies
outsideJapan,withtheU.S.headquarterslocatedinChicago,IL.
IntheUnitedStates,thecompanyemploysover200people.SunstarAmericasonlymarketsthe
ButlerGumbrand,underwhichthecompanyofferstoothbrushes,toothpastes,andsomeoral
careaccessoriesandflossproducts.
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Sunstar Americas distributes nationwide through food, drug, and mass merchandise retailers,
suchasWalmart,RiteAid,andPriceChopper.TheU.S.manufacturerslevelsalesforSunstars
cosmeticsandtoiletriesproductsareestimatedat$24millionin2011and2012.Thecompany
spends$1.8millionTMEtosupportitsbrandsin2012anditallocatesalloftheTMEtosupport
itsButlerGumbrand.ThecompanyallocatestheentireTMEthroughmagazineadvertisements.
TARTE
Tarte was founded in 2000 by Maureen Kelly and is headquartered at New York, NY. The
companydevelopsalineofcosmeticproductswiththepremisethattheyarefreeofsynthetic
ingredientsandnourishtheskin.
The company markets makeup products, such as primers, concealers, foundation, powder,
blush,bronzer,eyeshadow,eyeliner,mascara,lashenhancer,lipstick,lipgloss,liptint,andlip
liner.In2012,Tarteintroducesitssummerandfallcollectionofproducts.TheyincludeCallof
the Wild Amazonian Clay 8shadow collector's palette, Call of the Wild Amazonian Clay liner,
MaracujaMiraclefoundation,AmazonianClay12hourfullcoveragefoundation,Beauty&the
BoxAmazonianclayeyeshadowquad,andBambeautifulAmazonianClayeyeshadowpalette.
Thecompanypromotesitsproductsthroughtelevisioncommercialsandinmagazines,suchas
Allure,Cosmopolitan,Star,USWeekly,People,OK!,Life&Style,Lucky,andMarieClaire,andon
socialnetworkingsiteslikeFacebook,Twitter,andYouTube.Discountandsamplecouponsare
also available on the companys website. The products are available in 200 specialty stores
nationwide,suchasUlta,Sephora,andHenriBendel.
Tarte is a privatelyheld company and employs 17 people as of 2011. Sales are estimated to
remainconstantat$4millionin2012.
TATASNATURALALCHEMY
TataHarperSkincareisthebrandownedandmarketedbyTatasNaturalAlchemy,LLC,which
wasfoundedin2010byTataHarper,withtheaimtoofferwomenarangeofproductsthatare
natural,nontoxic,andofferresults.TataHarperisheadquarteredintheChamplainValleyof
Vermont.
Theproductionandmanufacturingoftheproductstakesplaceatthecompanysheadquarters
in Vermont where many of the essential ingredients are grown. The companys products
offerings include facial treatments, lip balms, jellies, and treatment and aromatherapy
products.
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Tostaytruetoitsnaturalandsustainablegoals,TatasNaturalAlchemymakeseffortstouse
recycledpackagingmaterials,recyclableglassbottles,andtreelesslabels.In2012,thecompany
changesitstaglineforthethirdtimetoTheNextGenerationofBeautyasthecompanyclaims
to formulate its products with unprecedented concentrations of active natural ingredients
between9%and29%perbottle.
In2012,TataHarperreformulatesitsHydratingFloralEssencewithbeetrootextractaddedand
ResurfacingMaskwithanewadvancedformula.
TataHarperSkincarefindspresscoverageinmagazinesincludingMarieClaire,VanityFair,LA
Confidential,HarpersBazaar,Prevention,Latina,Style,NYTimes,LATimes,Lucky,Allure,and
Vogue. The company is socially active on Facebook, Twitter, Pinterest, and YouTube. The
companydoesnotreportanysignificantTMEin2012.
Tata Harper skincare products are available at boutiques, department stores, drug stores,
online retailers, salons, specialty stores, and spa and resorts. Retailers carrying Tata Harper
productsincludeSpaceNK,OrganicAvenue,andBloomingdales.
SalesforthecompanyintheU.S.cosmeticsandtoiletriesmarketatthemanufacturerslevel
total$3millionin2012,almostflatfrom2011.In2013,thecompanyisexpectedtolaunchan
entirenewlipcarelinecomprisingtheBeTruesheerliptreatment,BeAdoredrosytintedlip
treatment,andBeFiercesheerliptreatment.
TEDGIBSON
Ted Gibson is a celebrity hairstylist who created his line of hair care products. His salons are
locatedinNewYork,NYandFt.Lauderdale,FL.HiscelebrityclientlistincludesAnneHathaway,
Debra Messing, Angelina Jolie, Ashley Greene, Joy Bryant, Zoe Saldana, Emma Watson, and
GabrielleUnion.
TedGibsonshaircareproductportfolioincludesshampooslikeDailycleanse,Claritycolor,and
GlimmeringGoldshampoo,conditioners,suchasDailyNourish,BrazenBrownconditioner,and
CaptivatingCopperconditioner,andstylingproductslikeFixitstylinggel,TameItShineLotion,
andBuildItBlowdryingAgent.
His work has appeared in publications, such as Vogue, Harpers Bazaar, Elle, Marie Claire,
Vanity Fair, People StyleWatch, W, and Allure. Ted Gibson is also the resident hair expert on
TLCsWhatNottoWear.Hisbrandsarepromotedontelevision,socialnetworkingsiteslike
Facebook,Twitter,andYouTube,andthroughonlineblogs.TedGibsonproductsareavailable
throughretailerslikeTarget,Sephora,QVC,beauty.com,beautybar.com,andamazon.com.
CosmeticsandtoiletriesproductssalesofTedGibsonareestimatedat$2millionin2012,same
as2011levels.
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TOOFACEDCOSMETICS
Thecompanywasestablishedin1998byJerrodBlandinoandJeremyJohnson.Itisoneofthe
largestindependentcosmeticscompaniesintheUnitedStates.BasedinIrvine,CA,TooFaced
Cosmeticsdevelopsandmarketsaportfolioofmakeupproductsthatareoftenusedbymakeup
artists and fashion stylists. It serves boutiques and department stores through a network of
global distributors. Apart from the United States and Canada, Too Faced Cosmetics has its
presenceinNorthernEuropeandtheAsiaPacificregion.
Thecompanymarketseyemakeupproducts,suchasbasesandprimers,shadows,glittersand
shimmers,liners,mascaras,andbrows;andlipproductslikelipglosses,lipsticks,plumpers,and
lip pencils. Its face makeup products include concealers, pressed powders, foundations,
blushes, bronzers, and bronzing palettes. In 2012, Too Faced Cosmetics launches The
ConfectionCollectionwhichincludesasetofeyeshadows,lipshades,andbrushes,andLove
SweetLovemakeupcollection.ItalsointroduceseyepaletteslikeShadowBonBons,Glamour
To Go Spun Sugar Edition, and Return of Sexy and mascaras like Better Than False Lashes,
3*WayLashLiningTool,andLashInjection.LaCrmelipstickpricedat$21.00islaunchedin16
shadesin2012.
Thecompanysassociationwithcelebrities,suchasCourtneyLove,Madonna,DrewBarrymore,
FranDrescher,ShannonDougherty,QueenLatifa,andBrookeShieldsprovidesstrongpublicity
to the brand. It also promotes its brands on websites like Facebook, Twitter, Instagram,
Pinterest, and YouTube. In January 2013, the company announces that Francesca Eastwood,
daughterofClintEastwood,isthenewfaceofthebrand.
IntheUnitedStates,productsareavailableinselectspecialtybeautystores,suchasSephora
andUlta,highenddepartmentstoreslikeNordstrom,andatothersmallretailers.
Thecompanyemploysaround50people.TotalsalesofTooFacedCosmeticsareestimatedat
$32million,upby6.6%from$30millionin2011.Salesgrowthissupportedbytheintroduction
ofmanynewproducts.
UNIVERSITYMEDICAL
Universal Medical Pharmaceuticals was founded in 1992 by Raymond Francis. It is

headquartered in Irvine, CA. The company markets and distributes personal care products.
Amongthepersonalcareproducts,itprimarilymarketsskincareproductsformenandwomen.
Themanufacturingandproductionactivitiesareoutsourced.
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Theproductrangecomprisesfourcorebrands:AcneFreeacnetreatments,FaceLiftantiaging
facial treatments, WrinkleMD professional use antiwrinkle treatments, and Body Lift body
firmingskincareproducts.However,thecompanysellsitsAcneFreelinefor$64millioninMay,
2012toValeantPharmaceuticals.
University Medical products are distributed through mass retailers, such as Target and
Walmart; drug stores, such as CVS, Walgreens, and Longs Drugs; food stores including
Albertsons; and cosmetics retailer Ulta. The company has strong distribution in warehouse
stores,CostcoandSamsClub.
Thecompanylaunchesseveralnewproductsin2012.Someofitskeylaunchesinclude:
WrinkleMD Eye Starter System claimed to give 15 times greater reduction in the
appearanceofwrinkles.
EyePatchthatclaimstokeeptheskinlookingradiant,smooth,andyouthful.
DomesticmanufacturerslevelsalesofcosmeticsandtoiletriesintheU.S.marketareroughly
$4 million in 2011 and 2012. These figures do not include the sales of Acne Free, due to the
divestiturein2012.UniversalMedicalhasnegligibleTMErecordedin2012.
URTH
Urth Skin Solutions for Men was founded in 2007 to develop grooming products specific to
men. Urths comprehensive product line comprises facial treatments, hand and body lotions,
and shaving products that are formulated with botanical solutions. The company is
headquarteredinLosAngeles,CA.
Urthsproductofferingsincludearangeoffiveproducts:FaceWashwithWhiteTea&Ginseng
gentle cleanser formulated with herbs, essential oils, antioxidants, and vitamins; Scrub with
GreenTeaandRiceremovesdeadcellsforsofter,smoother,andyoungerlookingskin;Shave
FormulawithGinseng&TeaTreeluxuriouscreamthatminimizesrazorburnsandbumps;Face
Balm with SPF 15 with White Tree and Vitamins provides antioxidant protection to improve
skin tone, texture, and reduce fine lines and wrinkles; and HydraTherapy antioxidant
hydratingtreatmentthatreducestheappearanceoffinelinesandwrinklesandstimulatesthe
production of collagen and elastin. The company claims that its product lines have been
inspiredfromancientAsianingredients.
UrthmarketingactivitiesinvolvesprintadvertisementsandPRwriteupsinmagazines,suchas
Mens Health and Instinct Magazine. Urth video commercials are available for viewing on
YouTube. The companys website offers tips and advice to men for their wellbeing. The
company offers a simple packaging reflecting the products natural botanicalbased
formulations.NosignificantTMEbythecompanyhavebeenreportedfor2012.
4A96
MinorCompanies
Urthproductsareavailableatselectbeautysalons,spas,andhotelsincludingViceroy,HairM,
MenEssentials,DetailsforMen,TheBreakersPalmBeach,andSkinReflections.
SalesofcosmeticsandtoiletriesforUrthintheUnitedStatesareestimatedat$3million2012,
almostflatfrom2011.During2013,thecompanyisexpectedtolaunchaclaymask,anunder
eyecream,andabodywash.
VALEANTPHARMACEUTICALS
Headquartered at Bridgewater, NJ, Valeant Pharmaceuticals is a specialty pharmaceutical

company engaged in the development, manufacture, and marketing of pharmaceutical
productsintheareasofneurology,dermatology,andinfectiousdiseases.
Foundedin1960,ValeantPharmaceuticalsmarketsover350brandedproducts.Asof2012,the
company has a work force of 7,500 employees across the globe. In the United States, it has
nearly 575 employees. The companys production facilities are located in four different
countries:Canada,Mexico,Poland,andBrazil.
Valeantoffersconsumerproductsforskinandhaircare,vitamins,painrelief,andtopicalcare,
amongothers.
SomeoftheotherbrandswithinValeant'scosmeticsandtoiletriesbusinessincludeDermaglow
skincareandmakeup,Dr.LeWinnbyKineraseskincare,Dr.Renaudskincare,Kinerase,CeraVe
skin care, Ultra, Dermaveen skin care, O, and Dermadrate skin care. The company acquires
Ambi fade cream from Johnson & Johnson and Acne Free from University Medical in 2012.
ValeantPharmaceuticalsallocates$5.7millionofTMEforitscosmeticsandtoiletriesproducts
in2012.Mostofthisamountisspentonmagazineadvertisements.
Total corporate sales for the company in 2012 are estimated at $3,550 million, up from
$2,460millionin2011and$1,181millionin2010.Ofthe$3,500millionworldwide,theUnited
Statesaccountsfor72.0%andcontributes$2,500millionin2012.
The companys manufacturers level sales in the United States for cosmetics and toiletries
productsareestimatedat$57million,down6.6%from$61millionin2011.Bothyears'sales
includetheacquiredAmbiandAcneFreebrands.InMarch2013,thecompanyannouncesthat
itisacquiringtheoutstandingstockofObagifor$360million.
697
698
MinorCompanies
VAPOURBEAUTY
Eric Sakas, cofounder of Kevyn Aucoin Beauty, Krysia Boinis, a botanical expert, and Kristine
Keheley, an abstract artist founded Vapour Beauty in 2009. The company is located at Taos,
NM.VapourBeautyscosmeticsaremadefromnaturalmineralpigmentssuspendedincertified
organic botanicals that help beautify the skin. Its products contain 70% of certified organic
ingredientsand30%ofvitaminsandminerals.ThecompanyusesLightReflectionTechnology
thatcomplementsdifferentskintonesandhelpstoavailthebenefitsofitsproducts.
VapourBeautysportfolioconsistsof110SKUsofskincareandmakeupproducts.Itsskincare
line consists of Essence Restorative Night Treatment that promotes cell renewal and Clarity
MakeupRemovingCleansingOilthatcleansandprovidesantiagingantioxidantstoprotectthe
skin. In its makeup line, the company markets brands, such as Atmosphere foundation,
Illusionistconcealer,Mesmerizeeyeshimmer,Auramultiuseblush,Solartranslucentbronzer,
Siren lipstick, Elixir lip gloss, and Vernissage 3free nail lacquer. In 2012, Vapour Beauty
launches its Vernissage Nail Lacquers which are available in four shades. Replenish Nail &
CuticleOil,madeofUSDA(U.S.DepartmentofAgriculture)certifiedorganicoilsandbotanicals
includingjojobaoil,reishimushrooms,andpomegranateseedoil,isalsolaunchedin2012.
Vapour Beauty products are promoted on social networking sites like Facebook, Google+,
Twitter, Pinterest, and YouTube, online blogs, and in magazines, such as Bella, Lucky,
Dermascope,Seventeen,OrganicSpa,InStyle,Fashion,Cosmopolitan,People,WWD,Allure,and
Health.Productsareavailableatvapourbeauty.comandselectspecialtyboutiques.
VapourBeautyhasastaffofaround12people.Salesareestimatedtogrowat11.1%toaround
$1millionin2012from$900,000in2011.
THEVILLAGECOMPANY
TheVillageCompanyisamarketeranddistributorofpersonalcareproducts.Thecompanywas
founded in 1993 and was formerly known as Minnetonka Brands. The Village Company is
headquartered in Chaska, MN. In 2008, the company acquires Mr. Bubble, an iconic bubble
bathbrand.
Thecompany'sproductsaresoldthroughretailandonlinestoresunderthebrandnamesMr.
Bubble,SesameStreet,BathShoppe,VillageNaturals,andVillageNaturalsAromatherapy.The
Village Companys product offerings include personal cleansing products, shampoos, foot
essentials,andtherapyproducts.
4A98
MinorCompanies
Asapartofits50thbirthdaycelebrations,in2011,thebrandcameoutwithaspecialbirthday
editionpackagingforitsproductsandgaveMr.Bubbles,themascotofthebrand,anewlook.
In2011,thebrandintroducedtheOriginalBubblyBodyWash,anextrabubblingformulathatis
tearfree, hypoallergenic, dermatologist and pediatriciantested, Extra Gentle Body Wash
gentlebodywashthatisdyefreeandfragrancefreeforsensitiveskin;MoisturizingHandSoap,
formulated with aloe, the hypoallergenic, dermatologisttested hand soap for both kids and
adults;andExtraGentleMoisturizingHandSoap,dyefreeandfragrancefreeExtraGentleHand
Soap.
In 2012, the company has not introduced any new products; however, the Therapy brand
undergoes a packaging change with respect to changes in the labeling and bottling. Also in
2012, The Village Naturals Bath Shoppe brings back the original Milk Bath Jug, a curvy jug
packagewithasinglehandleloopwithanewdyefreeformula.
The Village Companys newsletter, The Splash, keeps the consumers updated with the latest
news about the company pertaining to new product launches, exclusive promotions, and
coupons.Thecompanyishighlyactiveonsocialnetworkingsites,suchasFacebookandTwitter.
ItdoesnothaveanyTMEin2012.
Mr.Bubbleshaslaunchedanumberofretrostylecommercialsintheyearspriorto2012which
are available on YouTube. Products are retailed through a number of food, mass, and drug
stores including Walmart, Walgreens, RiteAid, Target, CVS, Duane Reade, Toys R Us, and
Kroger.Theseproductsarealsoavailableonamazon.comanddrugstore.com.
ThecompanyssalesintheU.S.cosmeticsandtoiletriesmarketareapproximately$11million
in2012,flatwith2011sales.
VINCENTLONGO
VincentLongolauncheditsrangeofcolorcosmeticsin1995.Itwasfoundedbyawellknown
makeupartist,VincentLongo,andisheadquarteredinNewYork,NY.Thecompanysproducts
gained popularity with the introduction of trendsetting color palettes in the late 1990s. The
founders association with supermodels and celebrities developed a following among
consumers.
VincentLongosproductportfolioincludesprimer,foundation,concealer,powder,eyeshadow,
mascara,eyelinerandpencil,fauxlashes,blush,bronzer,gelstains,lipstick,lipgloss,andlip
pencil. The company launched two new collectionsGalaxy Dream and New Essentialsin
2011 and one new collectionPulsein 2012. The Pulse collection introduces 10 SKUs that
includelippencil,lipstick,gelstains,andeyeshadow.
699
6100
MinorCompanies
Vincent Longo promotes its products via association with famous people. Some of its clients
include celebrities like Sharon Stone, Sigourney Weaver, Gwyneth Paltrow, Claire Danes,
Courtney Cox, Michelle Williams, Sarah Jessica Parker, Mena Suvari, Molly Sims, Paris Hilton,
Christina Ricci, Sissy Spacek, Jennifer Lopez, Jewel, Celine Dion, Candice Bergen, Bernadette
Peters,CatherineDeneuve,andElizabethHurley.
Vincent Longo products are available at Bloomingdales, Space NK freestanding stores,

Nordstrom, Cosmetic Boutique, Beauty.com, Makeup.com, and at select spas and boutiques
across the United States. The brands are promoted on social network sites like Facebook,
Twitter,andYouTube.
Salesareestimatedat$1millionin2012,thesameasin2011.
VOGUEINTERNATIONAL
VogueInternationalwasstartedbyahairstylist,ToddC.Christopherin1987.Heisthecurrent
presidentandchiefexecutiveofficerofthecompanyandisthesoleshareholder.Thecompany
isheadquarteredinTampaBay,Florida.VogueInternationalInc.marketsanddistributeshair
careandotherpersonalcareproducts.
Thecompanymarketsanddistributesproductsinnearly42countriesworldwide.Allproduction
activities are outsourced. Packaging of products is handled at Vogues 40,000squarefoot
facilitylocatedatanindustrialparkinOldsmar,FL,whichalsoservesasthecompanysglobal
headquarters.Ithas45employeesintheUnitedStates.
Thecompanysmainproductofferingsarehairstylingproducts,shampoos,andconditioners.
The company markets three brands: FX line of hair styling products, Organix collection of
shampoos,conditioners,andstyling/treatmentproducts,andOrganixBath&BodyCollection.
Thecompanylaunchesarangeofnewproductsin2012.Someofthekeylaunchesinclude:
MacadamiaOilDryStylingOilmadewithmacadamiaoilwhichthecompanyclaimsinstantly
hydratesandsmoothesdryhair.
Awapuhi Ginger Shampoo has a moisturizing formula and is infused with Awapuhi Ginger
extracttoinstantlymendandsoftendryhair.
Macadamia Oil Shampoo instantly hydrates and smoothens dry hair while mending split
endsforabrilliantshine.
MoroccanArganOilmakesthehairsmoothandshiny,healthy,andstrongwithitsnatural
ingredients.
4A100
MinorCompanies
Voguesproductsaredistributedprimarilythroughthefood,drug,andmasschannels,including
Albertsons,CVS,Kroger,Publix,RiteAid,Safeway,Target,Ulta,Walgreens,Walmart,andWinn
Dixie.Thecompanypromotesitsproductsprimarilythroughtheprintmedia.
ManufacturerslevelsalesintheUnitedStatesareestimatedat$63millionfor2012,upfrom
$60millionin2011.VogueInternationalspends$3.5millionTMEtosupportitsbrandsin2012.
ThecompanyspendsitstotalTMEtosupportitsbrandOrganixin2012.
WEIEAST
WeiEastwasfoundedbyWeiBrianin1999andisbasedinNewtownSquare,PA.Thecompany
combines traditional Chinese herbal medicines to deliver natural skin care treatments. The
company partnered with HSN in 2002. Wei East is a traditional Chinese skin care remedy
companyintheUnitedStates.Itformulatesmanytypesofherbsthatcreateacomplexwhichis
usedinitsproducts.WeiEastproductsareproducedinChina.
Wei Easts portfolio consists of skin care products which include cleansers, toners, serums,
moisturizers, masques, exfoliants, and specialty treatment products. Some of its skin care
products include Chestnut & Black Soy cleansing cream, Sichuan Holly Wrinkle Away Serum,
PomegranateAntiOxidantExfoliatingGrains,andBrightLightsRiceMilkSpotBrightener.The
company also markets makeup products like foundation, powder, concealer, blush, and lip
gloss. Some of them include Enriched Powder Foundation, Chinese Rose Pressed Blush, and
White Olive Tinted Lip Smoother. In 2012, Wei East launches White Lotus Hydrating a day
cream, Sichuan Holly Wrinkle Away Amazing Eyes, Sichuan Holly Wrinkle Away Serum, and
ChinaAgeDelaycollectionthatincludescleansers,toners,masques,moisturizers,andserums.
Products are promoted online through social network sites, such as Facebook, YouTube, and
Twitter. Wei Easts products are available through online retailers, such as weieast.com,
thefind.com,ebay.com,andhsn.com.
The U.S. manufacturers sales of the companyare estimated at $8 million in 2012, about the
sameas2011levels.
WELEDA
Weleda is a privatelyowned global manufacturer, distributor, and retailer of natural and

organic personal care products and pharmaceuticals. The company was founded in 1921 in
Arlesheim,Switzerland.Itisalsothecompanyspresentcorporateheadquarters.Weledawas
firstformedasapharmaceuticalcompanydevelopedbytheDutchmedicaldoctor,ItaWegman
andAustrianphilosopher,Dr.RudolfSteiner,toprovideremediesandbodycarepreparations
totheirpatients.
6101
6102
MinorCompanies
Weledas administrative headquarters and production division is located in Arlesheim,

Switzerland.TheWeledagroupconsistsof20subsidiaries,locatedinfivecontinentsincluding
Europe,Asia,Africa,NorthAmerica,andSouthAmerica.Thetwomostimportantsubsidiaries
are located in Schwbisch Gmnd, Germany, and Huningue, France. The company has three
productionfacilitieslocatedinFrance,Germany,andSwitzerland.
Weledas products are available in 50 countries across five continents with 20 regional
subsidiary companies. As of 2012, the company employs over 2,000 people worldwide.
Weledasproductformulationsaremadeupofalmostallnaturalororganicingredients,which
isanaddedadvantageoveranumberofothernaturalmarketers.
The companys personal care portfolio consists of 200 different products that broadly fall in
categories,suchasbabycare,bodycare,facialcare,haircare,mensskincare,andoralcare
products.
In2012,thecompanylaunchesthreenewbodylotionswhichincludesCitrusrefreshingbody
carefornormalskin,SeaBuckthorn,WildRose,andPomegranate.
WeledasproductsareavailableacrosstheUnitedStatesandCanada.Thecompanysproducts
arealsosoldonline,andalltheproductscanbepurchasedfromtheirwebsite.Weledaoffers
freeshippingonordersover$50.00.Thecompanyapportions$4,900ofTMEin2012.
Weledasglobalsalesofpersonalcareproductsatthemanufacturerslevelare$355millionin
2012, up from $324 million in 2011. The companys sales in the U.S. cosmetics and toiletries
marketsareapproximately$11millionin2012,anincreasefrom$10millionin2011,upby10%
mainlydrivenbytheintroductionofnewproductlauches.
YESTO
YesToInc.manufactures,distributes,andmarketsnaturalface,body,andhaircareproducts.
The company was founded in 2006 by Ido Leffler and his business partner, Lance Kalish. It is
headquartered in San Francisco, CA. The companys headquarters and production facilities
weremovedtotheUnitedStatesfromIsraelin2010.Thecompanydistributesproductsin15
countries and employs nearly 30 personnel in the United States and about 70 personnel
worldwide. The companys rapid success in a very short period is mainly due to its unique
formulation,combiningbetacarotenefromorganicfruitsandvegetables,and26mineralsand
traceelementsharvestedfromtheDeadSea.YesTomarketsover65SKUsofnaturalskincare
andhaircareunderfivesubbrands:YesToCarrots,YesToTomatoes,YesToCucumbers,and
Yes To Blueberries, and Yes To Baby Carrots. The companys product categories include
shampoos, conditioners, lip balms and jellies, facial treatments, hand and body lotions, baby
care,andsuncare.Thecompanyemphasizesthatingredientsusedforproductionarenatural,
ecological,andcertifiedorganic.Theingredientsintheproductlinearesourcedfromcertified
organicfarmers.ThekeyingredientsinYesTosproductsarebetacarotene,anaturalformof
VitaminAfoundinorange,yellow,anddarkgreenfruitsandvegetables.
4A102
MinorCompanies
The companys products are formulated for normaltodry skin and hair types; sensitive skin
typesandcolortreatedhair;andoily/combinationskintypesandfine/thinhair.Itoffersface
care products, including nourishing, soothing/sensitive, clear skin/acne, and age refresh
products; body care products comprising body moisturizers and washes, hand care products,
and intensive care products; hair care products, which include nourishing products and
soothingproducts;andlipandbabycareproducts.
Thecompanysellsitsproductsonlineandthroughdrug,mass,andgroceryoutletsintheUnited
States;andthroughretailstoresin15othercountries.IntheUnitedStates,thecompanyhas
theentirerangeofproductsstockedatWalgreens.Productsarealsoretailedthroughnational
retailchains,suchasUlta,CVS,DuaneReed,Target,andWholeFoods.Eachofthesechannels
playsanimportantroleinthecompanyscategoryandgrowthstrategy.Thecompanycontinues
toexpanditsdistributionnetworkintheUnitedStatesandEurope.
In the United States, the company considers PR, sampling, instore promotions, and social
medianetworks,suchasFacebookandTwitter,asthekeymarketingchannels.Thecompanys
productsarefeaturedinmagazines,suchasTheOprahMagazine,Lucky,People,Glamour,and
InStyle.
Yes to Blueberries Deep Wrinkle Night Cream that provides a soothing and intensive
parabenfreehydratingtreatmentforagingskin.
Yes to Blueberries Deep Wrinkle Filler claims to immediately reduce the look of fine lines
andwrinkles,isfreefrompetroleumandparaben.
Yes to Blueberries Softening Facial Exfoliator is formulated with Blueberries to fight the
formationoffreeradicals,andAppletohelprefreshandbrightentheskin'ssurface.
Yes to Carrots AntiFrizz Serum is perfect for frizzy hair types and provides a nourishing
serumtolockinmoistureandshine.
YestoCarrotsLeaveinConditionerclaimstodeliveramixofproteinsandarganoildeep
intothehaircuticleforseriousrestructuringandrejuvenatingbenefits.
The companys sales of cosmetics and toiletries in the United States are estimated at
$31millionin2012,upfrom$29millionin2011.YesTohasnegligibleTMErecordedin2012.
YVESROCHER
YvesRocher,Inc.,aprivatelyheldmanufacturer,marketer,andretailerofbotanicalbeautyand
wellness products, is headquartered in La Gacilly, France. It was founded in 1956 by Yves
Rocher,andisoneofFrancesleadingmarketersofnaturalpersonalcareproducts.Itisawholly
owned subsidiary of French beautycompany, Yves RocherS.A. The companys manufacturing
facilityislocatedinKilbarryBusinessPark,DublinHill,Ireland.YvesRocherhasitsUnitedStates
headquarters located in Houston, TX. The company distributes 300 million products in more
than 80 countries. The Yves Rocher Group owns seven brands, all focused on women: Yves
Rocher,PetitBateau,Stanhome,DrPierreRicaud,DanielJouvance,Kiotis,andIDParfums.
6103
6104
MinorCompanies
The company is a global marketer of a broad range of natural personal care products. It
specializesintheskincaresegment,includingproductcategories,suchasfacialtreatmentsand
hand and body lotions. Yves Rocher is also one of the leading marketers of mass market
fragrances across continental Europe. The company further competes in the household
cleaningandhomeimprovementproductscategorywithitsStanhomebrand.
Yves Rochers popular products include Recovery Moisturizer Night 1st Lines, an antiaging
moisturizerthattargetsagingsignswithconcentratedricepeptidesandceramides;Arnica2in
1 Hand & Nail cream; Nourishing Shampoo for dry hair; and Laotian Lotus Flower, an anti
perspirantdeodorantthatgives24hourprotection.
In 2012, Sanofi sells its 19.3% stake in the Yves Rocher Group to Socit Financire des
LaboratoiresdeCosmtologieYvesRocher.TheRocherfamilyisexpectedtocontrolmorethan
95%oftheGroupscapitalafterthisdivestmentofstakebySanofi.Sanofiacquiredastakein
theYvesRocherGroupscapitalin1973anddivestedpartofitsstakeintheearly2000s.Yves
Rocher Group acquires 51% share in Flormar, a Turkish cosmetics company, in 2012, for an
estimated$150million.
Distribution is primarily through direct mail and freestanding independent stores worldwide.
The company generates 60% of its revenues through direct mail orders from sources that
include its catalog, website, and independent beauty consultants. The remaining 40% of its
revenues are generated through its independent freestanding stores. In the United States,
almostonehalfofitssalesaregeneratedthroughdirectmailorders.Itpromotesthroughsocial
media websites like Facebook by informing about new product launches, giving makeup tips,
andprovidingreviewsaboutitsvariousproducts.ThereisnoevidentallocationofTMEforYves
Rochersproductsin2012.
Thecompanylaunchesarangeofnewproductsacrossitsskincare,makeup,fragrances,body
care,andbathandshowerproducttypesin2012,suchasCultureBIOAntiWrinkledaycare,
Culture BIO AntiWrinkle night care, Couleurs Nature High Concentration nail lacquer, Candid
MallowsandVanillaLemonSparklingbodylotion,andLesJardinsDuMondeshowergel.
YvesRochersglobalcorporaterevenueisabout$3billionin2012.ManufacturerssalesofYves
RocherforcosmeticsandtoiletriesintheUnitedStatesareestimatedat$73millionin2012,up
7.4% from $68 million in 2011 based on new product launches, and its practice of actively
connectingtocustomersbyprovidingdetailsonitsproducts.
4A104
MajorCompanies
SectionFive
MAJORCOMPANIES
SectionFiveof
ContinuingService
CARRIEMELLAGE
KlineMarketResearch
+19734353412
SPECIALNOTICE


company.

thesubscriber.
Kline&Company,Inc.
Servingthe
Strategicanalyses
4A4
TABLEOFCONTENTS
Page
MAJORCOMPANIES
Introduction....................................................................................................................51
Overview........................................................................................................................53
Totalsales........................................................................................................................53
Growth.............................................................................................................................54
Alticor(Amway)..............................................................................................................57
Companyoverview..........................................................................................................57
Corporatesalesandprofits..............................................................................................59
Cosmeticsandtoiletries.................................................................................................510
Recentdevelopments....................................................................................................511
Marketingactivity..........................................................................................................511
Outlook..........................................................................................................................512
Avon.............................................................................................................................515
Companyoverview........................................................................................................518
Corporatesalesandprofits............................................................................................518
Outlook..........................................................................................................................525
Beiersdorf.....................................................................................................................529
Outlook..........................................................................................................................537
Chanel..........................................................................................................................541
Outlook..........................................................................................................................546
TABLEOFCONTENTS
(Continued)
Page
MAJORCOMPANIES(Continued)
Church&Dwight...........................................................................................................549
Outlook..........................................................................................................................555
Clarins...........................................................................................................................557
Outlook..........................................................................................................................562
TheCloroxCompany.....................................................................................................565
Outlook..........................................................................................................................572
ColgatePalmolive.........................................................................................................575
Outlook..........................................................................................................................583
Combe..........................................................................................................................587
Outlook..........................................................................................................................591
4A2
TABLEOFCONTENTS
(Continued)
Page
Coty..............................................................................................................................593
Recentdevelopments..................................................................................................5101
Newproducts...............................................................................................................5102
Marketingactivity........................................................................................................5103
Outlook........................................................................................................................5105
ElizabethArden..........................................................................................................5107
Companyoverview......................................................................................................5109
Corporatesalesandprofits..........................................................................................5110
Cosmeticsandtoiletries...............................................................................................5111
Outlook........................................................................................................................5114
EnergizerHoldings......................................................................................................5119
Outlook........................................................................................................................5126
EsteLauder...............................................................................................................5129
Notablenewproducts.................................................................................................5141
Outlook........................................................................................................................5149
GlaxoSmithKline.........................................................................................................5155
Outlook........................................................................................................................5162
TABLEOFCONTENTS
(Continued)
Page
GuthyRenker.............................................................................................................5165
Outlook........................................................................................................................5170
HelenofTroy..............................................................................................................5173
Outlook........................................................................................................................5180
Johnson&Johnson.....................................................................................................5183
Outlook........................................................................................................................5198
Kao.............................................................................................................................5203
Outlook........................................................................................................................5210
LimitedBrands............................................................................................................5213
Outlook........................................................................................................................5223
4A4
TABLEOFCONTENTS
(Continued)
Page
LOral........................................................................................................................5227
Outlook........................................................................................................................5252
LVMH..........................................................................................................................5257
Outlook........................................................................................................................5264
MaryKay....................................................................................................................5267
Outlook........................................................................................................................5273
Merck.........................................................................................................................5275
Outlook........................................................................................................................5280
Procter&Gamble.......................................................................................................5283
Outlook........................................................................................................................5308
TABLEOFCONTENTS
(Continued)
Page
Revlon........................................................................................................................5313
Outlook........................................................................................................................5321
Sanofi.........................................................................................................................5325
Outlook........................................................................................................................5330
Shiseido......................................................................................................................5333
Newproducts...............................................................................................................5339
Outlook........................................................................................................................5340
Unilever......................................................................................................................5345
Managementchanges.................................................................................................5355
Newproducts...............................................................................................................5355
Outlook........................................................................................................................5362
4A6
INTRODUCTION
Thissectionpresentssummariesofpertinentmarketingandfinancialdataonthe29leading
companiesofcosmeticsandtoiletries,allwithannualsalesinexcessof$145million.
Thecompaniesarearrangedalphabetically.
If a subsidiary marketscosmetics and toiletries, it is classified under the name of the
parentcompany.
Foreachmajorcompany,thefollowingdataarepresented:
Overview.Abriefdescriptionofthecompanysmajorbusinessinterests.
Corporate sales and profits. The companys recent overall financial history, including
sales, profits, margin or sales, and when available, returns on stockholders equity.
Return on equity is calculated as the percentage of net profit after taxes to
stockholders equity, equal to book value. Related segment data are included when
available.
Cosmetics and toiletries. A breakdown of the companys divisions and brands that
market cosmetics and toiletries and a discussion of the sales of these products. A
competitiveanalysisofselectedproductsmayalsobeprovided,alongwithadetailed
listofthecompanysbrandsofcosmeticsandtoiletries.
Recent developments. A discussion of activities, such as new product introductions,
acquisitions,divestitures,mergers,managementchanges,andlegalactivity.
Marketingactivity.Adescriptionofvariouspromotionalvehiclesusedbythecompany.
Traceablemediaexpendituresareprovidedinaseparatesectionofthisstudy.
Outlook. A forecast of manufacturers sales of cosmetics and toiletries through U.S.
consumer outlets for five years. The forecast, based primarily on an analysis of the
productsnowofferedbythecompany,isdevelopedbyanalyzingthevariousmarkets
inwhichthecompanycompetes,withsomeadjustmentsbasedonKlinesestimateof
itsmarketingstrengths.Futuresalesestimatesaregiveninbothunits andrealdollar
sales.
52
Introduction
4A2
OVERVIEW
TOTALSALES
In 2012, consumer sales of cosmetics and toiletries in the United States reach
approximately$40.4billion,upby3.4%from$39.0billionin2011.
The 29 largest companies profiled here capture 79.4% of the industry, valued at
$32.1billion.
The companies vary in size, ranging from Helen of Troy at $147million in sales to
Procter&Gamblessalesof$5,824millionin2012.
The top 10 cosmetics and toiletries marketers represent 61.9% of total industry sales in
2012.
Nineoutof10ofthesemarketerscosmeticsandtoiletriessalesareestimatedatmore
than$1billioneach.
Table51:U.S.SalesofCosmeticsand
ToiletriesforLeadingCompanies,2012
Company
$Million
Procter&Gamble
5,824
L'Oral
4,551
Unilever
3,546
EsteLauder
2,722
Johnson&Johnson
2,020
LimitedBrands
1,785
ColgatePalmolive
1,493
Coty
1,086
MaryKay
1,063
Avon
948
Revlon
814
GuthyRenker
737
Henkel
635
(Continued)
54
Overview
Table51:U.S.SalesofCosmeticsand
ToiletriesforLeadingCompanies,2012
Company
$Million
Shiseido
542
Kao
525
Chanel
461
GlaxoSmithKline
407
EnergizerHoldings
396
Beiersdorf
344
LVMH
337
Church&Dwight
313
ElizabethArden
290
Merck
209
Sanofi
197
Alticor
176
TheCloroxCompany
172
Clarins
171
Combe
157
HelenofTroy
147
Allother
8,304
Total
40,372
GROWTH
Total manufacturers sales of cosmetics and toiletries increase by 3.4%, or $1,346million

from2011.
The29largestmanufacturersexperienceacombinedincreaseinsalesby3.0%in2012.
4A4
Overview
Table52:U.S.SalesofCosmeticsandToiletrieswithPercentageGrowthfor
LeadingCompanies,2011and2012
$Million
Company
2011
2012
Change,%
GuthyRenker
616
737
19.6
Chanel
417
461
10.6
LVMH
307
337
9.8
TheCloroxCompany
158
172
8.9
Merck
192
209
8.9
Alticor
164
176
7.3
Clarins
160
171
6.9
EsteLauder
2,569
2,722
6.0
L'Oral
4,304
4,551
5.7
LimitedBrands
1,706
1,785
4.6
EnergizerHoldings
379
396
4.5
ColgatePalmolive
1,431
1,493
4.3
504
525
4.2
3,406
3,546
4.1
392
407
3.8
1,048
1,086
3.6
Shiseido
527
542
2.8
Beiersdorf
335
344
2.7
1,979
2,020
2.1
154
157
1.9
1,047
1,063
1.5
Revlon
802
814
1.5
Sanofi
194
197
1.5
Henkel
626
635
1.4
5,898
5,824
(1.3)
321
313
(2.5)
1,014
948
(6.5)
ElizabethArden
313
290
(7.3)
HelenofTroy
160
147
(8.1)
7,903
8,304
5.1
39,026
40,372
3.4
Kao
Unilever
GlaxoSmithKline
Coty
Johnson&Johnson
Combe
MaryKay
Procter&Gamble
Church&Dwight
Avon
Allother
Total
55
56
Overview
Outofthetop29companiesprofiledinthisreport,fivemarketersregisterasalesdecline,
andtheremaining24companiesregisterasalesgainin2012.
GuthyRenker, a leading direct response television marketing company, registers the
highestgrowthat19.6%in2012,withsalesat$737millionin2012from$616millionin
2011.
Chanel,aprestigecompany,registersthesecondhighestgrowthat10.6%,withsales
at$461millionin2012upfrom$417millionin2011.
LVMH shows the thirdhighest growth at 9.8% in 2012 to reach $337 million in 2012
TheCloroxCompanyandMerckaretiedinthefourthpositionwithagrowthof8.9%in
2011.
Amongthemajor29companies,16companiesregistersalesgrowthgreaterthanthe
industryaverageof3.4%in2012.
Helen of Troy records the highest decline among the top 29 companies, with sales
declining8.1%from$160millionin2012to$147millionin2012.
Five companies register declining sales in 2012, with Avon, Elizabeth Arden, and Helen of
Troydemonstratingthesharpestdeclines.
4A6
ALTICOR(AMWAY)
Table53:AmwaysSalesofCosmeticsandToiletriesinthe
UnitedStates,2011and2012
$Million
Category/brand
2011
FACIALTREATMENTS
2012
Artistry
53
54
LauraMercier
24
28
Total
77
82
FACEMAKEUP
LauraMercier
33
37
Artistry
13
13
Total
46
50
18
19
22
23
11
11
10
Total
19
21
TOTAL
164
176
EYEMAKEUP
LauraMercier
Artistry
Total
Artistry
LauraMercier
COMPANYOVERVIEW
BasedoutofAda,MI,Alticorisadirectsellingmarketerofnutrition,wellness,beauty,and
homecareproducts.Thecompanyoperatesthroughthreekeysubsidiaries:
Amway,oneoftheworldsleadingdirectsellingcompaniesofbeautyandhomecare
products.
Access Business Group, a manufacturer and distributor of products worldwide for
Amwayanditscontractcustomers.
AlticorCorporateEnterprises,aholdingcompanyforthecorporationsnondirect
sellingcompanies.ThecompanyoperatesresortmanagementfirmAmwayHotel,
upscalecosmeticsmakerGurwitchProducts(marketerofprestigebeautybrandsLaura
MercierandRevive),andhealthdiagnosticsdeveloperInterleukinGenetics
58
Alticor(Amway)
Founded in 1959, the company entered the beauty business with the introduction of the
Amwaygroup.
Alticor USA owns and controls all its manufacturing and distribution facilities
throughouttheworld,includingmanufacturingfacilitiesintheUnitedStatesandChina.
Thecompanyalsooperatesorganicallycertifiedfarmsforgrowingfoodsupplements.It
hasorganicfarmsintheUnitedStates,Mexico,andBrazil,andhasdistributionfacilities
inNorthAmerica,Europe,Asia,andtheMiddleEast.
Thecompanyhasabout20,000employeesworldwide.Inaddition,ithasanindirectsales
staffofmorethan3millionpeople,whichmainlyincludesitsaffiliatesanddistributors.
Alticorhasapresencein80countries.
The company has a strong presence in Asian countries, including China, South Korea,
India,Indonesia,andThailand,Japan,Australia,andNewZealand.
In 2000, the company stopped marketing products in North America under the Amway
brandnameandcalleditselfQuixtar.
However,in2008,inanattempttorevivetheAmwaybrand,itrebrandedQuixtarto
AmwayGlobal,andthenchangeditsnametoAmwayNorthAmericain2010.
TheAmwaynameisretainedforthecompanysglobaldirectsalesbusiness.
Amway, which accounts for the majority of Alticors revenues, manufactures a wide
rangeofproductsincludinghouseholdcleaningandlaundrysupplies,floorwaxes,and
polishes, personal care products (cosmetics, toiletries, and fragrances), vitamins and
nutritional supplements (manufactured by the Nutrilite Products subsidiary), home
technology products, including security and water treatment systems, commercial
productlines,andmensandwomensapparel.
Amways products are marketed directly to consumers through more than 3million
independentdistributorsinmorethan100countriesandterritories.
More than 6,500 durable and nondurable products are sold through a sales catalog
calledPersonalShoppers,aswellasavarietyofservicesandeducationalproducts.
Morethan450productsbeartheAmwaybrandname.
Amwayoperateseightregionaldistributioncentersnationwide.
The company employs about 20,000 worldwide, with roughly onethird located in the
UnitedStates.
Amwayhas25domesticandmorethan50foreignsubsidiaries,withmostengagedin
themarketingofthecompanysproducts.
MorethantwothirdsofAmwayssalescomefromAsia;Chinaisthecompanyslargest
individualmarket.
Since1995,AmwayhasexpandedoperationsintoChina,SouthAfrica,theDominican
Republic,Romania,Venezuela,Scandinavia,Croatia,Namibia,theUkraine,Singapore,
andRussia.
Amways products, as well as nationally branded products, are also sold online through
AlticorsQuixtarsubsidiary.
4A8
Alticor(Amway)
CORPORATESALESANDPROFITS
Alticor is a privately held company and does not divulge its financial information to the
public.
Amway,beingasubsidiaryofAlticor,doesnotdivulgeitssalesinformation.
The total sales for Alticor are estimated at $11.3billion in 2012, an increase of
approximately3.7%fromabout$10.9billionin2011.
Table54:AlticorsGlobalCorporateSales,2007to
2012
Yeara
$Billion
Change,%
2007
7.1
2008
8.2
15.5
2009
8.4
2.4
2010
9.3
10.7
2011
10.9
17.2
2012
11.3
3.7
aYearendingDecember31.
Table55:AlticorsGlobalCorporateSalesbyProduct
Category,2012
Category
%Oftotal
NutritionandWellness
46.0
BeautyandPersonalCare
26.0
HomeCare
22.0
Durables
6.0
Total
100.0
Beautyandpersonalcareproductsgeneratesalesofabout$2.9billion in2012,drivenby
theArtistrybrand.
This is the seventhconsecutive year of growth for the company, which has posted sales
increases12outofthepast13years.
59
510
Alticor(Amway)
Amwaygrowsineachofthe10marketsforthefirsttimein20yearsin2012.Thesemarkets
includeChina,India,Korea,Malaysia,Russia,Thailand,Taiwan,theUkraine,andtheUnited
States.
Colombia, Italy, Turkey, Mexico, Hong Kong, Venezuela, and Russia post doubledigit
increasesin2012.
COSMETICSANDTOILETRIES
Table56:AmwaysCosmeticsandToiletriesSalesinthe
Year
$Million
Change,%
2007
113
2008
120
6.2
2009
130
8.3
2010
145
11.5
2011
164
13.1
2012
176
7.3
The companys sales of cosmeticsand toiletries in 2012 are estimated at $176million, up

Facialtreatmentsisthelargestproductcategoryforthe company,withtotalsalesof
$82millionin2012.Thesalesinthecategorygrow6.5%from$77millionin2011.
Facial treatment products account for 46.6% of the companys total cosmetics and
toiletriessalesin2012.
Themarketersellstwobrandsinthecategory:ArtistryandLauraMercier.
The companys leading brand in the facial treatments category is Artistry, which
accountsforthemajorityoftheskincarebusinessforthecompany.
Amwaymainlyfocusesonantiagingproductsintheskincaresegment.
The companys makeup product class sales account for 53.4% of the companys total
cosmetics and toiletries sales, totaling $94million in 2012, up from $87million in the
previousyear.
LauraMerciercontinuestobetheleadingmakeupbrandforthecompany,withsales
of$66million,up11.9%from$59millionin2011.
Sales of its other makeup products, offered under the Artistry label, remain flat at
$28millionin2012,flatfrom2011.
There are no other major developments for the marketer in the makeup segment
during2012.
4A10
Alticor(Amway)
Thecompanycontinuestogainmarketshareinthedirectsellingindustryandhasastrong
yearacrossthemap.
Thecompanyskeyproductlinesimprovethecompanyscompetitiveposition.
The concept of global investment in building brands is helping distributors; in return,

makingitiseasierforthemtosellproductsthatconsumersalreadyseekbyname.
The company continues to invest in its global power brands, Artistry and Nutrilite,
whichhelpsitsdistributorsgloballytogenerategoodreturnsbothforthecompanyand
themselves.
TherearesignificantnewproductlaunchesforArtistryin2012.
ThecompanylaunchesArtistryYouthXtendAntiagingcollectionin2012,promotedto
betterservewomenaroundtheglobewhoarestartingtonoticethefirstsignsofaging
and who want to keep their skin looking younger. Other significant launches include,
ArtistryVolumeMascaraandArtistryMenDermasync.
Amway launches Laura Mercier Matte Powder for Skin, featuring new baked
technologyinsixshadesandLauraMercierAmbreVanillaBodyButterandHandCream.
RECENTDEVELOPMENTS
InJanuary2012,ArtistryfeaturesAustralianactress,TeresaPalmerasthenewglobalface
foritsskincareandcolorcosmetics.
In March 2012, Amway teams up with the University of Michigan to harness exclusive
patentedtechnologyinitsskincareproductsthatcounterscommonsideeffectsofretinol
forimprovedresults.
MARKETINGACTIVITY
With more than 3million distributors globally, Amway promotes its products primarily
throughdistributorsandaffliates.
Thecompanycirculatesamonthlymagazine,theAmagram,throughwhichitprovides
salesliterature,inadditiontotheaudioandvideomaterialsthatitprovidestoitssales
associates.
The marketer also promotes its products though broadcast advertising including
magazines, television, and radio, apart from the product promotions done by
distributors.
TotalTMEsforthecompanyin2012are$12.1million;almost99.1%ofthisisspentto
backthemultiplecategorypromotionsthroughlocalmagazines.
The company also promotes and sells its products through its website that contains
linkstoallofitsdirectresponsebrandsalongwithproductdescriptions.Thesitealso
containstoolstohelpconsumerspurchaseproducts.
The company continues to gain attention by sponsoring charitable and philanthropic
projects. The marketer funds and organizes charity programs in health, education,
environment,arts,andculturalpractices.
511
512
Alticor(Amway)
Themarketerincreasesitssocialmediapresencetopromoteitsproducts.
Thecompanyincreasesitsfocusonsocialmediamarketingwhichhelpsittoreachout
to a younger generation of independent business owners that sell and distribute the
companysproducts.
New product information and promotional offers are presented by the company
throughitsrespectiveFacebookpage.
Amwaypromotesitsproductsthroughsocialmediasites,suchasPinterest,Facebook,
andTwitter.
Amwayspendsabout78.5%or$9.5millionofTMEinpromotingitsbrandLauraMercierin
2012.
Thebrandisprimarilypromotedthroughlocalmagazines.
OUTLOOK
Amwayscosmeticsandtoiletriesbusinessisforecasttogrowatacompoundannualgrowth
rate(CAGR)of3.5%overthenextfiveyears,2012to2017.
Thecompanyplanstolaunchnewandinnovativeproductsacrosscategoriesthatwill
supportitsgrowthovertheforecastperiod.
Themarketerwillcontinuetoincreaseitssalesrepresentativestosupportitssalesin
thefuture.
However, most multilevel marketing companies are not expected to enjoy as high
growth in the forecast period as in the past five years, due to the success of more
moderatelypricedproductsalsosoldthroughdirectchannelssuchastheInternetand
homeshoppingtelevisionchannels.
The facial treatments category is expected to be the largest revenue generator for the
marketerovertheforecastperiod.
The company will launch innovative products in order to support the growth of the
category.
The growing demand for antiaging products is expected to drive the sales of the
category for the marketer over the next five years. Furthermore, Amway is likely to
expand its Artistry brand with new antiaging products to support its growth in the
facialtreatmentscategory.
ThefacemakeupcategoryislikelytopostthehighestgrowthforAmwayovertheforecast
period.
Themarketerplanstolaunchnewproductsunderthecategorytosupportitssales.
Amwayisexpectedtointroducefacemakeupproductswithmultipleskincarebenefits,
alongwithnewtechnologyinproductformstosupportitssales.
Themarketerislikelytoprovidenewvariationstothetraditionalpressedpowderblush
informs,suchaswhippedcream,sticks,andliquidtintsinordertopromoteitssales
4A12
Alticor(Amway)
TheflagshipbrandofAmway,Artistrywillcontinuetodrivethesalesofthecompanyover
theforecastperiod.
Thecompanyplanstolaunchnewandinnovativeantiagingproductsunderthisbrand
inthenextfiveyears.
Thecompanyinexpectedtoincreaseitsmediaspendingontheseproductstosupport
sales.
The company sells all its products through direct sales and will continue to do so in the
future,asitisanintegralpartofitssalesmodel.
Alticorwillcontinuetoincreaseitspromotionalandmarketingactivitiesinordertosupport
itsgrowthoverthenextfiveyears.
Themarketerisexpectedtoincreaseitssocialmediapresencetokeepitsconsumers
engagedbyconductingvariouscontestsandcampaigns.
Alticors cosmetics and toiletries sales are projected to increase to $209million by 2017
from$176millionin2012,increasingataCAGRof3.5%.
Table57:ForecastDollarSalesGrowthofCosmeticsand
ToiletriesforAmwaybyCategory,2012to2017
Category
CAGR,%
Facemakeup
4.5
4.0
COMPANYAVERAGE
3.5
Eyemakeup
3.0
Facialtreatments
2.5
513
514
Alticor(Amway)
4A14
AVON
Table58:AvonsSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
FACIALTREATMENTS
2012
Avon
217
202
Mark
Total
222
206
OutspokenIntensebyFergie
14
15
OutspokenbyFergie
12
13
Imari
11
11
EternalMagic
10
10
Today
10
10
FarAway
ImariSeduction
RareGold
RareDiamonds
Haiku
Mark
Tomorrow
StepIntoSexy
14
Always
HerveLegerFemme
Candid
UbyUngaroFeverforHer
BondGirl007
InBloom
UbyUngaroforHer
FRAGRANCESFORWOMEN
ExpressionsbyReeseWitherspoon
(Continued)
516
Avon
2011and2012
$Million
Category/brand
2011
FRAGRANCESFORWOMEN(Continued)
ChristianLacroix
ChristianLacroixAbsynthe
11
12
156
146
Avon
97
91
Mark
13
12
Total
110
103
Avon
95
88
Mark
13
12
Total
108
100
Avon
85
85
Mark
10
Total
95
94
75
70
Footworks
Mark
Total
89
82
87
78
90
81
MesmerizeforMen
BlackSuede
DerekJeterDrivenBlack
Ironman
Allother
Total
FACEMAKEUP
EYEMAKEUP
HANDANDBODYLOTIONS
Avon
Avonbathadditives
Avonbarsoaps
Total
FRAGRANCESFORMEN
(Continued)
4A16
2012
Avon
2011and2012
$Million
Category/brand
2011
FRAGRANCESFORMEN(Continued)
WildCountry
DerekJeterDriven
PatrickDempseyUnscripted
PatrickDempsey2
ChristianLacroixNoir
Turn4XT
DerekJeterDrivenFresh
DerekJeterDrivenSport
DerekJeterDrivenWarm
HerveLegerHomme
Allother
58
56
29
28
Avon
20
18
Mark
Total
22
20
17
15
11
11
Avon
TOTAL
1,014
948
Total
SUNCAREPRODUCTS
Avon
NAILPOLISHES
SHAMPOOS
Avon
Avon
Avon
CONDITIONERS
2012
517
518
Avon
COMPANYOVERVIEW
Avon was established in 1886 and employs the direct sales model, mostly by using
independentsalesrepresentatives.
It is a global manufacturer and marketer of cosmetics and toiletries, apparel and
jewelry,andhousewares.
ThecompanyislistedontheNewYorkStockExchangeandisheadquarteredinNew
York.
AsofDecember2012,Avonemploysapproximately39,100employeesworldwide.Of
these, approximately 4,800 are employed in the United States and 34,300 in other
countries.
Avoncurrentlyoperatesitssalesactivitiesin65countriesandterritories,includingthe
UnitedStates,anddistributesitsproductsin43morecountries.
Avonhasmorethan6millionactiveindependentrepresentativesworldwide.
In2012,85%ofthecompanysrevenueisfromoutsidetheUnitedStates.
Avonhasapresenceinsevenglobalregions:LatinAmerica,NorthAmerica,Centraland
EasternEurope,WesternEurope,theMiddleEastandAfrica,AsiaPacific,andChina.
Avonsbusinessisdividedintothreesegments:
Beauty,comprisingfragrances,colorcosmetics,skincare,andpersonalcareproducts
Fashion,includingfashionjewelry,apparel,footwear,watches,andaccessories
Home, comprising housewares, gifts and decorative products, entertainment and
leisureproducts,andchildrensandnutritionalproducts
CorporatesalesforAvondecline5.1%from$11,291.6millionin2011to$10,717.1millionin
2012.
Avonsnetprofitstotal$526millionin2011andthecompanypostslossof$38million
in2012.
Saleshavegrownatacompoundannualgrowthrate(CAGR)of1.9%since2007.
Table59:AvonsGlobalCorporateSales,2007to2012
$Million
Year
Sales
Netprofits
Marginonsales
2007
9,759
533
5.3
140.6
2008
10,508
883
8.2
80.7
2009
10,205
619
6.0
211.9
2010
10,863
595
5.4
35.5
2011
11,292
526
4.6
33.1
2012
10,717
(38)
(0.4)
(3.1)
4A18
Returnonequity
Avon
In the secondquarter of 2012, Avon manages Central and Eastern Europe and Western
Europe, the Middle East, and Africa as a single operating segment. This segment is now
called Europe, the Middle East, and Africa. The company also includes the Dominican
RepublicinLatinAmerica,whilepreviouslyitwasincludedinNorthAmerica.
Intermsofsales,LatinAmericacontinuestobethelargestcontributor,comprising46.6%of
thecompanyscorporatesalesin2012.
Avons2012salesinLatinAmericadeclineby3.3%to$4,994million.
Europe,theMiddleEast,andAfricarepresent27.2%ofthecompanystotalsalesin2012.
Theregionssalesdeclineby6.7%to$2,914millionin2012from$3,123millionin2011.
SalesforthecompanyinNorthAmericadecreaseby7.7%to$1,907millionin2012.
Theregioncontributesto17.8%ofAvonssalesin2012.
AsiaPacificrepresents$902millionor8.4%ofthetotalsalesin2012.
Table510:AvonsSalesbyGeographicalRegion,2011and2012
$Million
Region
2011
2012
LatinAmerica
5,162
4,994
Europe,theMiddleEast,andAfrica
3,123
NorthAmerica
AsiaPacific
Total
%Oftotal
2011
2012
Change,%
45.7
46.6
(3.3)
2,914
27.7
27.2
(6.7)
2,065
1,907
18.3
17.8
(7.7)
942
902
8.3
8.4
(4.2)
11,292
10,717
100.0
100.0
(5.1)
BeautycontinuestobeAvonslargestbusinessunit,accountingfor71.3%ofthecompanys
globalsalesin2012,althoughitwitnessesadeclineof5.3%from2011.
Table511:AvonsSalesbyGlobalBusinessUnit,2011and2012
$Million
Productcategory
2011
2012
Beauty
8,068
7,643
Fashion
1,995
Home
Allothera
%Oftotal
2011
2012
71.4
71.3
(5.3)
1,892
17.7
17.7
(5.2)
1,049
1,012
9.3
9.4
(3.5)
180
171
1.6
1.6
(5.0)
100.0
(5.1)
Total
11,292
10,717
100.0
aIncludesshippingandhandlingfeesbilledtosalesrepresentatives.
Change,%
519
520
Avon
SalesofAvonscosmeticsandtoiletriesproductsintheUnitedStatesdeclineby6.5%,from
$1,014millionin2011to$948millionin2012.
Since2007,salesdeclineataCAGRof3.5%from$1,134millionin2007to$948million
in2012.
AvonscosmeticsandtoiletriesproductsintheUnitedStatescontinuetodeclineina
rowforfiveyearsasthemarketerfacesproblemssuchasdefectionandlowmoraleof
salesassociates.
Table512:AvonsCosmeticsandToiletriesSales,2007to
2012
Year
$Million
Change,%
2007
1,134
2008
1,114
(1.8)
2009
1,098
(1.4)
2010
1,077
(1.9)
2011
1,014
(5.8)
2012
948
(6.5)
Facial treatments continues to be Avons largest product category, with $206million in

manufacturerssalesin2012,downby7.2%from$222millionin2011.
Avoncontinuestobethethirdlargestdirectsellingbrandinthecategory.
Thecompanystruggleswithitswellpublicizedproblemsatattractingandmaintaining
salesassociatesintheUnitedStates,andthecompanydevotesmuchofitsenergiesto
expandinginotherregionsoftheworld.
Its major facial treatment launch of the year is an addition to the Anew Clinical line
calledProLineEraser,whichthecompanycomparestoinjectablecollagenandretinols
toreducethelookofdeepwrinklesinoneweek.
TheGenicslineisextendedinMarch2012withaneyecream.
ThesecondlargestcategoryforAvonisfragrancesforwomenin2012.
Thecategoryssalesdropby6.4%,from$156millionin2011to$146millionin2012.
Avon slips to seventh place among manufacturers sales in the category, with a 5.4%
share,downfrom6.0%sharein2011.
Avoncontinuestoalignwithcelebritiesanddesignerstointroduceitsnewfragrances.
TheonlysignificantlaunchbyAvoninthecategoryin2012isUnpluggedforHerunder
theJonBonJovibrand.
4A20
Avon
FacemakeupcategorysalesofAvonareestimatedat$103millionin2012,down6.4%from
$110millionin2011.
Avonrepresents19.1%oftotaldirecttradeclassfacemakeupsalesin2012,downfrom
20.0%ofsalesin2011.
Increase in competitors promotional and advertising expenses, ready availability of
massproducts,andnewproductintroductionsbymostmarketersmakeitchallenging
fortraditionaldirectmarketerssuchasAvontogrowin2012.
Avonseyemakeupcategorysalesdecrease7.4%from$108millionin2011to$100million
in2012.
The company holds the sixth position in the eye makeup category in 2012, with a
categoryshareof3.7%,downfrom4.1%ofcategorysalesin2011.
Lack of new product activity and limited advertising support contributes to the
marketersdeclineinthecategoryin2012.
Thesalesforthecompanyslipsticksandlipglossescategorydecline1.1%from$95million
Thecompanymarketstwobrandsunderthecategory:AvonandMark.
Sales of the Avon brand drop by $1million; however, sales of Avon as a company
remainflatinthecategory.
Avons hand and body lotions have a relatively small presence in the cosmetics and
toiletriesindustry.
Categorysalesofthemarketerdropfrom$89millionin2011to$82millionin2012.
Lackofnewproductactivityaffectsthemarketersdeclineinthecategory.
Avon,Mark,andFootworksarethebrandsmarketedinthiscategory.
Thecompanyspersonalcleansingproductscategoryssalestotal$81millionin2012;sales
declineby10.0%from$90millionin2011.
ThecategoryincludesAvonbrandbathadditivesandbarsoaps.
Salesofbathadditivesdeclineby10.3%;however,salesofbarsoapsremainflatinthe
category.
Thefragrancesformencategorydeclinesinsalesfrom$58millionin2011to$56millionin
2012.
Avon slips to the fifth spot in the category with market share of 5.1% in 2012, down
from5.5%in2011.
Limitednewproductactivitycontributestothemarketersdeclineinthecategory.
TheonlysignificantlaunchbyAvoninthecategoryin2012isUnpluggedforMenunder
theJonBonJovibrand.
Avonpromotesitsfragrancesinitsmonthlycatalogsandonitswebsite.
521
522
Avon
Avons sun care products category sales decline by 3.4% from $29million in 2011 to
$28millionin2012.
ThecompanymarketsonlytheAvonbrandunderthiscategory.
The companys nail polishes category sales decline by 9.1%, from $22million in 2012 to
$20millionin2011.
Avonisthefifthlargestnailpolishmarketerwithacategoryshareof3.0%,downfrom
3.9%in2011.
Avondoesnotfarewellinthenailpolishescategorybecausethecompanyisstruggling
for market share in the United States and the brand faces stiff competition from the
massmarket.
Avon still accounts for the majority of the nail polish sales within the direct channel,
holdinga62.1%sharein2012.
AvonshaircareproductsareallmarketedundertheAvonbrand.
Theshampooscategoryssalesaredown11.8%,from$17millionin2011to$15million
in2012.
Theconditionercategoryssalesareflatat$2millionin2012,flatwith2011levels.
RECENTDEVELOPMENTS
Otherdevelopments
In2012,Avoncontinuestofacemanychallenges.
InquiriesaremadeintoallegationsofbriberybythecompanysemployeesinChinaand
othercountries.
InMarch2012,Cotymakesanunsolicited$10billionoffertoacquireAvon,asitplans
toutilizeAvonsstrongsalesforceinemergingmarkets.
InApril2012,AvonrejectsCotys$10billionofferforatakeover.
The$23.25persharebidwasputata20%premiumtoAvonsrecentstockprice.Avon
responded that the valuation was too low, and that Cotys nonbinding bid did not
presentarealoffer.
InOctober2012,AvoncatchestheFoodandDrugAdministrations(FDAs)attentionfor
havinginfringedguidelinesregardingfivedifferentproductsofitsAnewrange.
FDA claims that its products Anew Clinical Advanced Wrinkle Corrector, Anew
Reversalist Night Renewal Cream, Anew Reversalist Renewal Serum, Anew Clinical
Thermafirm Face Lifting Cream, and Solutions Liquid Bra Toning Gel have uses that
apparentlycausethemtobeclassifiedasdrugs.Asaresult,FDAasksAvontorectify
theviolations,whileAvonpledgesitscommitmenttoabidebythelawsandregulations.
Avon outlines initial steps to costcutting, two of which include global headcount
reductionofapproximately1,500positions,anditsexitfromSouthKoreaandVietnam.
4A22
Avon
In February 2013, Avon declares its fourthquarter losses deepen as a result of
In March 2013, Avon completes its refinancingactivities, by closing public offering of
$1.5billioninnotes.
In2013,Avoninvestsinnewshrinksleevepackagingsystemsforitslipsticks,eyeliners,
andmascaras,whichresultsincostsavingsforthecompany.
Managementchanges
TherearecertaintoplevelmanagementchangesrecentlyatAvon.
InApril2012,AvonnamesSherilynMcCoyasthenewCEO;shewaspreviouslyworking
asaViceChairmanwithJohnson&Johnson.
In April 2012, the company announces that Douglas Conant is elected to its board of
directors, with immediate effect. Conant, retired last year as President and CEO of
CampbellSoupCo.andistheCEOofDRCLLC.
KimberlyRossjoinsasExecutiveVicePresidentandChiefFinancialOfficer,shecomes
fromtheRoyalAholdgroup.
AvonappointsPatriciaPerezAyalaasChiefMarketingOfficer.
In January 2013, Avon appoints David Powell as Senior Vice President of Business
TransformationandGlobalSupplyChain.
In August 2012, Avon appoints Scott Curm as the Senior Vice President of Human
Resources and Jeff Benjamin as the the Senior Vice President of General Council in
2012.
InApril2013,FredHassanresignsafterfourmonthsofhistenureonBoardofDirectors.
Newproducts
Table513:SelectNewProductsIntroducedbyAvonintheUnitedStatesin2012
Brand
Category
Description
Avon
Facialtreatments
AnewClinicalProLineEraserwithpatentedAF33(AminoFill
33)thecompanyclaimsworkslikepotentantiagersAHA,
retinol,andinjectablecollagen,reducingthelookofdeep
wrinklesinoneweek
Avon
Facialtreatments
Genicslineisextendedwithaneyecream
JonBonJovi
Fragrancesformen
UnpluggedforMenisacollaborationbetweenAvonandJon
BonJoviandisawoody,floral,muskyscent
JonBonJovi
Fragrancesforwomen
UnpluggedforHerisacollaborationbetweenAvonandJon
BonJoviandoffersafloralorientalcompositionstartingwith
gourmetnotesofplumandcitrus
523
524
Avon
MARKETINGACTIVITY
Avon primarily uses company brochures, websites, and sales associates for product
promotion.
Salesforceincentiveprogramsaremostcommonlyused.
OtherpromotionaleffortsbyAvonmainlyincludesamplingandpricepromotions.
The marketer promotes its brands through its websites and through social media
channelsincludingFacebook,Twitter,Tumblr,Pinterest,andYoutube.
Avon advertises its new product launches and other product promotions on its
Facebookpagetosupportitssales.
Although,themarketerreliesprimarilyonsalesassociatestopromoteitsproducts,itis
alsoincreasinglyutilizingothervehiclesincludingtheprintandtelevisionadvertising.
The marketer has approximately more than 6million active sales representatives
acrosstheglobe,eventhoughthisnumberhasbeendecreasing.
Campaigns, media advertising, print advertisements, discounts, and giftwithpurchase

(GWP)offersaretheotherpromotionaltoolsforAvon.
Avon regularly promotes various products in its catalogs and on its website with
discountedpricestoencouragemultiplepurchases.
While not part of measured mediaexpenditures, Avons brochures are central to the
promotionofthebrand,andserveinlieuofafulladvertisingcampaign.
Infact,someofAvonstraditionaladvertisinginthepasthasbeenmorerecruitment
oriented, as a way to secure new sales associates in contrast to promoting actual
products.
Avonalsoprovidesbeautytipsandguidesonitswebsite.
Thecompanyswebsiteoffersaskincareguidethatincludesrecommendationsbased
onconsumersresponsestoanonlinequiz.
Avonhastoolsonitswebsitethatallowaninterestedpartytofindasalesconsultantin
theirrespectivearea.
Advertisements regarding the companys products can be viewed directly on Avons
website.
Avontypicallypromotesnewfragrancesonitsbrochurecoveratthetimeoftheirlaunch.
Avoncontinuestoprintitsnewcatalogseverytwoweeks,apracticewhichcontinues
tobecriticizedasconfusingtoconsumersandwasteful.
Scentstripsareoftenfeaturedinitscatalogs.
Tohelpenticeconsumers,thesalesassociatesfrequentlyholdproductdemonstration
gatheringswhereparticipantsaregivenafreeproduct,suchasfullsizelipgloss,ora
dollarcredittowardspurchasing.
4A24
Avon
Avonsignsonpopularcelebritiesforitsproductandcollectionlaunches,andfeaturesthese
celebritiesinitscatalogs.
Avons2012brochurefeaturesvariouscelebritiesincludingAleshaDixonandKatyAtlas.
In 2012, the marketer partners with American musician Jon Bon Jovi for its new
Unpluggedlineoffragrances.
AvonalsowidelypublicizesitsannualWalkforBreastCanceranditsprogramstofight
domesticviolence.
Avon spends about $13.0million on traceable media expenditures (TMEs) to support its
brandsin2012,downby11.0%from$14.6millionin2011.
Morethan90%oftheTMEisspentthroughtelevisionandlocalmagazines.
The company promotes its products mainly through television (75.5%), followed by
magazines(14.6%)in2012.
AvonspendsthehighestTMEonpromotingitsfacialtreatmentscategoryin2012.
Thecompanyspendsabout$9.3million,or71.5%ofitsTMEonthefacialtreatments
category, up from nearly $8.1million during 2011. In the facial treatments category,
the company spends about $4.4million on promoting its new launch, Avon Anew
ClinicalProLineEraser,in2012.
OUTLOOK
SalesofAvonarelikelytogrowmarginallyby0.8%overthenextfiveyearsintheUnited
States.
ThecompanywithitsnewCEO,SheriMcCoy,hasnotbeenforthcomingaboutplansto
recuperate.However,somethingshavebeenmadeclear.
The company plans to focus more on field programs to increase its number of
representatives. These initiatives will help strengthen the companys presence in
developingmarketsandalsointhedevelopedmarkets.
The company expects continued challenging financial results within the North
American business, partially as a result of the ongoing impact of field transformation
andredistrictingintheUnitedStates.
Thecompanyhasoutlinedstepstowardsachievingacostsavingtargetof$400million
beforetaxesbytheendof2015.
They also continue to implement an enterprise resource planning (ERP) system on a
worldwide basis, which is expected to improve the efficiency of its supply chain and
financialtransactionprocess.
Thecompanyplanstousevariouspricingandpromotionalmodels,whichareexpected
toprovideadeeperunderstandingofthepricingwithinitsproductporfolios.
Itplanstoincreasethedepthofthemanagementstructure.
525
526
Avon
Avonislikelytofocusonnewtechnologyandproductinnovationtodeliverfirsttomarket
productsthatprovidevisibleconsumerbenefits.
The company is expected to grow in the facial treatments category supported with
more product launches. The new product introductions are likely to be innovative
products with multifunctional benefits in the forecast period, similar to its Anew
ClinicalProLineEraserproductin2012.
The company strengthens its product presence and offers strong competition to its
competitors by varying the technology it infuses in its products and package design.
Thisalsohelpsthemarketertoincreasethevisibilityoftheitsproducts
Avon is expected to strengthen its position in the facial treatments category with
brandsthatfunctionasahomealternativetodermatologicaltreatments.
Avonplanstofocusonitscorebusinessinordertostabilizesalesovertheforecastperiod.
Asapartoftheplan,themarketerisexpectedtofocusonitsskincare,fragrances,and
makeupproductclassesbylaunchinginnovativeproductsovertheforecastperiodto
supportitssales.
The marketer plans to appoint executives who will effectively manage and develop the
businessforthemarketerovertheforecastperiodasapartofitsrestructuringprogram.
Asapartofthisplan,AvonappointsDavidPowell,whoformerlyworkedforcompanies
such as Johnson & Johnson and Midreef Partners, as the Senior VicePresident of its
businesstransformationandglobalsupplychaindivisions.
Avonwillcontinuetoworkonitscostsavingprograminordertosupportitsgrowthinthe
UnitedStates.
Asapartofthecostsavingprogram,themarketerplanstocut400executivejobsin
2013.
Themarketerislikelytofinishtherestructuringofitsbusinessbyendof2013,which
willhelpthecompanyachievestableresultsovertheforecastperiod,2012to2017.
ThemarketeralsoclosesitsdistributionfacilitiesinNorthAmericaasapartofitscost
savingprogram.
The marketer is expected to pull out its business from some of the underperforming
marketsincludingIrelandandothermarketsinEuropeovertheforecastperiod.
The marketer is expected to launch naturallypositioned products across categories,

especially skin care and makeup, as this segment is projected to perform well over the
forecastperiod.
Avon plans to launch Totally Kissable lipstick that contains natural oils and organic
ingredientsincludingfruitextracts.
The marketer will continue to infuse and reformulate its products with natural
ingredientsinordertosupportitssales.
However,dabblinginthissegmentwillnotstrengthentheAvonbrandbutwillperhaps
muddleit.
4A26
Avon
Avonwillcontinuetotryincreaseitssalesrepresentativesovertheforecastperiodinorder
toboostitsoverallsales.
Avon will likely improve the reward and effort equation for its representatives. The
marketer offers webbased tools for its representatives to help them increase their
sales.
Furthermore, there will be continued efforts to recruit and train representatives. As
with any cosmetics and toiletries marketer, Avon will also depend on new product
launches and reformulation of existing product lines with improved ingredients or
improvedpackagingtosupportitssalesgrowththroughtheforecastperiod.
In the United States, the company also markets its products through consumer
websites.
The marketer will continue to promote its products primarily through its sales
representatives and is expected to adopt other methods of marketing its products, for
example, by initiating specialty boutiques within mass retail stores, or by recruiting
representativesinstoretomarketproducts.
Thecompanyalsoadoptsthepromotionofpackageditemsformarketingitsproducts,
whileprovidingsalesaidstotherepresentativessuchasbrochures,productsamples,
anddemonstrationproducts.
CotyorsomeothercompanyisexpectedtooffertobuyAvonovertheforecastperiod.
IfCotyacquiresAvonduringtheforecastperiod,Avonsstrugglingfragrancebrandsare
likelytobenefitfromthesuccessofCotysfragrancesbrands.
However, Coty would also likely to benefit from Avons successful skin care and
makeuplines.
SalesofAvonareprojectedtogrowataCAGRof0.8%toreach$987millionby2017,up
from$948millionfrom2012.
Table514:ForecastDollarSalesGrowthofCosmetics
andToiletriesforAvonbyCategory,2012to2017
Category
Facialtreatments
Eyemakeup
Fragrancesforwomen
Facemakeup
Fragrancesformen
Suncareproducts
COMPANYAVERAGE
Nailpolishes
Handandbodylotions
Shampoos
Conditioners
CAGR,%
1.8
1.5
1.2
1.2
1.2
1.0
0.8
0.5
0.5
0.4
0.4
0.3
0.3
0.2
0.2
527
528
Avon
4A28
BEIERSDORF
Table515:BeiersdorfsSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
HANDANDBODYLOTIONS
Nivear
94
94
Eucerin
82
85
Aquaphor
21
22
197
201
LaPrairie
35
37
Eucerin
11
11
Basis
Total
47
49
43
44
45
46
14
16
14
14
15
15
14
14
335
344
Total
FACIALTREATMENTS
Niveabodywashes
Basisbarsoaps
Total
Nivea
NiveaforMen
LaPrairie
Total
SHAVINGPRODUCTS
NiveaforMen
FRAGRANCESFORMEN
NiveaforMen
TOTAL
rRestated.
2012
530
Beiersdorf
COMPANYOVERVIEW
Beiersdorf AG is a leading international branded goods company in the cosmetics and

toiletries,adhesiveproducts,andmedicalproductsindustries.
Thecompanywasestablishedin1882.
ItsheadquartersislocatedinHamburg,Germany.
Thecompanyemploysapproximately16,605employeesworldwideattheendof2012.
Thecompanysbusinessisdividedintotwobusinesssegments:
Theconsumerbusinesssegmentmanufacturesandmarketsskincareandbeautycare
products.SomeoftheleadingglobalbrandsofferedbythedivisionareNivea,LaPrairie,
andEucerin.Thedivisionalsooffersregionalbrands,suchasLabello,8X4,Hansaplast,
Florena,andSlek.
The Tesa division manufactures and markets selfadhesive systems and product
solutions.Tesahasoperationsinmorethan100countries.
In 2012, the company invests a total of 159million ($204million) in research and

development,down2.5%from163million($210million)in2011.
CorporatesalesforBeiersdorfreach6,040million($7,762million)in2012,up7.2%from
5,633million($7,239million)in2011.
The companys net profits grow 74.1% from 259million ($333million) in 2011 to
451million($580million)in2012.
Table516:BeiersdorfsCorporateWorldwideSales,2007to2012
Million
Year
Netsales
Profitsaftertax
Marginonsales
Returnonequity
2007
5,507
442
8.0
21.4
2008
5,971
567
9.5
23.0
2009
5,748
380
6.6
14.4
2010
5,571
326
5.3
11.2
2011
5,633
259
4.5
8.6
2012
6,040
NOTE:$1.00=0.7781.
451
7.5
13.7
4A30
Beiersdorf
Beiersdorfs consumer business segments sales in 2012 increase 7.5% to 5,048million

($6,488million),upfrom4,696million($6,035million)in2011.
Organicgrowthforthesegmentis4.9%in2012.
Thecontributionoftheconsumersegmenttothetotalcompanyssalesincreasesfrom
83.3%in2011to83.6%in2012.
Table517:BeiersdorfsCorporateWorldwideSalesbyBusinessSegment,
2011and2012
Million
%Oftotal
Businesssegment
2011
2012
2011
2012
Consumer
4,696
5,048
83.3
83.6
937
992
16.7
16.4
5,633
6,040
100.0
100.0
TESA
Total
NOTE:$1.00=0.7781.
EuropecontinuestobethelargestmarketforBeiersdorfin2012,generatingover56%ofits
revenues,downfromitsshareof59.5%in2011.
Table518:BeiersdorfsCorporateWorldwideSalesbyRegion,2011and2012
Million
%Oftotal
Region
2011
2012
2011
2012
Europe
2,792
2,831
59.5
56.1
Africa/Asia/Australia
1,029
1,205
22.0
23.9
875
1,012
18.5
20.0
4,696
5,048
100.0
100.0
Americas
Total
NOTE:$1.00=0.7781.
BeiersdorfisamongtheleadingmarketersofskincareproductsintheUnitedStates.
531
532
Beiersdorf
Table519:CosmeticsandToiletriesBrandsofBeiersdorfintheUnitedStates,2012
Brand
Product
AQUAPHOR
Handandbodylotions
BASIS
Barsoaps,facialtreatments
EUCERIN
Handandbodylotions,facialtreatments
LAPRAIRIE
CellularPlatinum
Facialtreatments
SkinCaviar
Facialtreatments,handandbodylotions
WhiteCaviarIlluminatingSystme
Facialtreatments
CellularRadiance
Antiaging
AdvancedMarineTechnology
Facialtreatments
CellularTreatmentColor
Makeup
SilverRain
Womensfragranceandtoiletries
NIVEA
Nivea
NiveaBathCare
NiveaBody
Handandbodylotions
NiveaforMen
Skincareproductsformen,fragrancesformen,shaving
products
NiveaSoft
Handandbodylotions
The companys sales in the U.S. cosmetics and toiletries market grow 2.7% from
Table520:HistoricalSalesofBeiersdorfintheU.S.
CosmeticsandToiletriesMarket,2007to2012
Year
$Million
Change,%
2007
287
2008
297
3.5
2009
312
5.1
2010
322
3.2
2011
335
4.0
2012
344
2.7
4A32
Beiersdorf
SkincareisthelargestproductclassforBeiersdorf.
Skincareproductsaccountfor77.0%ofthecompanyssalesintheU.S.cosmeticsand
toiletriesmarketin2012.
SalesforBeiersdorfinthisproductclassincreaseby2.3%toreach$265millionin2012
Beiersdorfaccountsfor2.5%ofthetotalsalesinthisproductclassin2012.
Beiersdorfs Consumer Business Segment applies for patents for 87 inventions in the
fiscal year 2012. The company launches various new products that include hand and
bodylotions,facialtreatments,andshavingproductsin2012.
The hand and body lotions category is the largest contributor to the companys sales in
2012.
Handandbodylotionsshareinthecompanyssalesdecreasesfrom58.8%in2011to
58.4%in2012.
Beiersdorfssalesinthecategoryincreasefrom$197millionin2011to$201millionin
2012,registeringagrowthof2.0%.
The company markets its Nivea, Eucerin, and Aquaphor brands under this product
category.
Beiersdorf becomes the fourthlargest marketer in the category, displacing Unilever,
contributingto8.8%ofthetotalcategoryssalesintheU.S.marketin2012.
Niveaistheleadingbrandforthemarketerinthehandandbodylotionscategory,with
Niveas product offerings include lotions, hand creams, and gels/serums with a wide
selectionofproductsforthelotionssegment.
EucerinisthenextbiggestbrandforBeiersdorfinthecategory,postinga3.7%growth
toreach$85millionin2012from$82millionin2011.
In 2012, Eucerin undergoes packaging changes for its hand and body lotions by
streamlining the design for each product. A texture scale design is added to the
packagingthatshowsiftheproductisrich,lightweight,orfallsbetweenthetwo.
Additionally,theproductnamesarechangedtomakeiteasierforconsumerstoclearly
identifywhattheproducthastooffer.Thisproductnamechangeismadefor11SKUs
inthehandandbodylotionscategory.
SalesofAquaphorincreaseto$22millionin2012,up4.8%from$21millionin2011.
The companys secondlargest category, facial treatments, accounts for 14.2% of the
companysoverallsalesin2012;thesharegrowsfrom14.0%in2011.
Sales of the category grow 4.3% in 2012, from $47million in 2011 to $49million in
2012.
Beiersdorfoffersaluxurybrand,LaPrairie,inthefacialtreatmentscategory.
Salesofskincareproductsformenare$15millionin2012,constantfrom2011levels.
Thecompanyisthethirdlargestplayerinthecategory,with8.9%marketsharein2012,
downfrom9.7%in2011.
533
534
Beiersdorf
Othertoiletriesisthesecondlargestproductclassandcontributes17.4%tothecompanys
totalsalesintheU.S.marketin2012.
Salesinthisproductclasspostanincreaseof1.7%in2012,from$59millionin2011to
$60millionin2012.
The company participates in the shaving products and personal cleansing products
categories,ofwhichpersonalcleansingproductsistheonlycategorytoshowgrowth.
Lipbalms,jellies,andtreatmentsisthefifthlargestcategoryforthecompanyin2012.
Sales of lip balms, jellies, and treatments grow 14.3% from $14million in 2011 to
$16millionin2012.
Niveasshareinthecategoryincreasesfrom3.9%in2011to4.3%in2012.
RECENTDEVELOPMENTS
Otherdevelopments
In February 2012, Beiersdorf launches Eucerin Skin Institute, an integrated concept that
consists of scientific skin diagnosis as well as personal consultation and individual skin
treatment.
InDecember2012,Beiersdorfacquirestheremaining50%sharesandvotingrightsinEBC
EczacbaBeiersdorf Kozmetik rnler Sanayi ve Ticaret A.S (Turkey) for 29million
($37million).Atthetimeofacquisition,Beiersdorfpaysafixedcomponentof 25million
($32million)incashandacontingentpurchasepricepayableattheoffsetoffiscal2014if
certainperformanceindicatorsaremetin2013.
Managementchanges
DuringApril2012,StefanF.HeidenreichtakesoverfromThomasB.QuaasasthenewCEO
of the company. Stefan F. Heidenreich has held leading positions in the international
consumerandbrandedgoodsindustryforalmost25years.
InMarch2012,BeiersdorfannouncestheappointmentofJoeOliveriasVicePresident,
SalesandMikeVoadenjoinsBeiersdorfasSeniorDirectorofNationalAccounts.
In October 2012, Sven Jacobsen assumes the role of Vice President Corporate
Communications at Beiersdorf. He had previously served as the head of corporate
communications at the MediaSaturn group, an European electrical and electronics
goodsretailer.
In March 2013, Peter Feld, the board member responsible for the European/North
American region, leaves the company. CEO Stefan Heidenreich assumes Felds duties
untilfurthernotice.
4A34
Beiersdorf
Newproducts
Table521:SelectNewProductsIntroducedbyBeiersdorfintheUnitedStatesin2012
Brand
Category
Description
Eucerin
Handandbodylotions
ProfessionalRepairExtremelyDrySkinLotionisinfusedwithceramide
3andglucoglycerol,retainsmoisture,andpreventsfurtherdryness
LaPrairie
Facialtreatments
SkinCaviarLiquidLiftissaidtoliftandfirmtheskinstructure,protect
andrestoreepidermalstemcellfunction,preventtheappearanceand
deepeningoflinesandwrinkles
LaPrairie
Facialtreatments
CellularPowerComplex,whichincludesingredientssuchasSwisssnow
algaeandtissueguidancematrix,issaidtofueldefenseandstimulate
theskinsnaturalprocessesforrepair.Productincludesginsengroot
extract,horsetailextract,andglycoproteins,issaidtohelpstimulate
theskinsrenewalprocesswhilemoisturizingandenergizingskin.The
formulaalsoincludespanthenolandsodiumhyaluronatefor
moisturizingproperties
Nivea
Lipbalms,jellies,and
treatments
BeiersdorfintroducesNiveaLipbutterbalmsinjarformatsthatis
availableinfourdifferentflavors:RaspberryRoseKiss,CaramelCream
Kiss,VanillaandMacadamiaKiss,andSmoothKiss
MARKETINGACTIVITY
The companys spending on mediabased advertising and promotions are $26.0million in

2012.
Traceablemediaexpenditures(TMEs)decrease45.1%,from$47.4millionin2011.
Thecompanyutilizesawiderangeofmediatoolstopromoteitsproducts.
The largest part of the media spend are for television spots and magazines, which
togetheraccountfor88.1%ofthetotalTMEofthecompany.
The company spends about 65% of its TME through magazines and almost 23% on
The company spends 51.5% of its media budget on the promotion of its skin care
brands,NiveaandEucerinin2012.
Inspiteofadeclineinitsadvertisingexpendituresin2012,Beiersdorfcontinuestobethe
thirdleadingadvertiserinthehandandbodylotionscategory.
The company allocates a TME of $33.4million in 2012, up 5.0% from $31.9million in
2011.
In 2012, Beiersdorf spends $17.5million on its Nivea brand, with $12.4million being
allocatedtothetelevisionmedia.
Beiersdorf allocates approximately $16million for its Eucerin brand in 2012, with an
equaldivisionbetweentheprintandtelevisionmedia.
535
536
Beiersdorf
In May 2012, Aquaphor, a product owned by the Eucerin division of Beiersdorf AG,
announcesthetitlesponsorshipoftheAquaphorNewYorkCityTriathlon.
Coupons of several denominations are offered by Beiersdorf in an attempt to entice

consumerstopurchaseitsproducts.
Coupons,whichareusuallyprintedordigital,makesproductsavailabletoconsumers
atapricelowerthantheregularmarketprice. Thisinducesconsumers tosplurge on
products.
In2012,Eucerinofferscouponsworth$1.50onitshandandbodyproductsandNivea
offerscouponsworth$2.00onNiveahandandbodylotionproducts.Socialmediasites
andSundayfreestandinginserts(FSIs)arethemostfavoredmeanstoadvertisesuch
offers.
Beiersdorf introduces a new logo and design for its Nivea brand in order to significantly
enhancethebrandsrecognition.
The marketer introduces the new logo in May 2012; all Nivea products across the
categorieshavethenewlogoonthem.
While pointofsale displays and advertising are important, store traffic decreases. The
companyincreasesitspresenceonlineinordertocreategreatervisibilityofitsbrandsand
tosupportitsonlinesales.
BeiersdorfextensivelyusessocialmediachannelssuchasFacebook,Twitter,andYouTube
topromoteitsbrandsandproducts.
Thesechannelsprovideconsumersaplatformtodiscussandsharetheirexperiences,
reviewsproducts,andasktheirqueriestobrandexperts.
These social networking pages/accounts inform consumers about new product
introductions, events, special offers, discounts, coupons, sweepstakes, and other
companyinitiatives.
In2012,NiveapartnerswithGrammyAwardwinningrecordingartistNeYo,televisiontalk
showhostWendyWilliams,andNiveabrandambassadorsBillandGiulianaRancictoextend
itsyearlongNiveamillionmomentsoftouchmovementandcelebrateNationalPDA(Public
DisplaysofAffection)Day.
Aspartofthecelebration,NiveahostsaseriesofeventsinNewYork,LosAngeles,and
nineothercitiesacrossthecountrytoencouragecouplestogetoutintheopenand
showtheiraffectionforoneanother.
In2012,NivealaunchesKissofStyleDesignContestexclusivelyonFacebook.
CharlotteRonson,aleadingfashiondesigner,joinsasthecelebrityjudge.
Through this contest, people will be able to personalize their favorite Nivea lip care
productstomakememorablekissmomentsthatmuchmorespecial.
4A36
Beiersdorf
OUTLOOK
Beiersdorfisforecasttopostgrowthof1.8%overtheforecastperiod.
Beiersdorfisexpectedtofocusonproductinnovationoverthenextfiveyears.
Innovation could be in the form of new product activity, packaging changes, and
improvedformulationsincludingtechnologicaladvancements.
Beiersdorfplanstolaunchmenspecificproductsovertheforecastperiodtosupportits
salesgrowth,asproductsformenareexpectedtoperformwell.
Themarketerislikelytofocusonitsskincareproductclassovertheforecastperiod,as
itwillbethehighestrevenuegeneratorforBeiersdorf.
Themarketerisexpectedtomaintainitsforecastgrowthbyintroducinginnovativeproducts
Furthermore,Beiersdorfwillcontinuetofocus onitscorecompetencyinskincarein
theU.S.marketthroughbrandssuchasNiveaforMen,Eucerin,andAquaphor,aswell
asitsmainstaybrandNivea.
Beiersdorf will continue to focus on its Nivea brand and the company is expected to
increaseitspromotionalsupportforthebrandoverthenextfiveyears.
Theskincareproductclass,whichisthelargestproductclassforBeiersdorf,willcontinueto
bethemainfocusforthemarketer.
The facial treatments category for Beiersdorf is expected to perform well with the
launchofantiagingproducts.
Consumers are expected to spend more on skin care as they regain their purchasing
capacity.
Other factors that are expected to support the marketers growth in the skin care
product class include innovative packaging formulations, products with improved
technologies,andincreasingpromotionalactivities.
Nevertheless, hand and body lotions will remain the most important category as a
proportionoftotalsalesforthecompanyduringtheforecastperiod.
Nivea,theflagshipbrandofthecompany,willcontinuetodrivesalesforthecompany,
asthebrandoffersalargenumberofvariantsunderitsumbrellainthecategory.
Beiersdorfplanstolaunchinnovativeproductswithimprovedformulationstosupport
thecategorysgrowthoverthenextfiveyears.
537
538
Beiersdorf
Beiersdorf is expected to adopt innovative marketing techniques in order to promote its

products.
Themarketerwillcontinuetoprovidesamples,coupons,giveaways,andcontestsasa
partofitsmarketingstrategy.
Over the next few years, Beiersdorf is expected to continue to invest aggressively in
marketing to establish itself as a leader in skin care, especially with its Nivea and
Eucerinbrands.
The marketer plans to make a packaging change for its Nivea products across
categoriesin2013tostrengthenthebrandspresence.
AlltheproductswithnewpackagingwillalsohavethenewNivealogoonthem.
Thecompanyisexpectedtocontinuetospendheavilyonprintandelectronicmediato
promoteandadvertiseitsproducts.
Inspired by the success of its recent social network marketing, the company will
continuetopromoteitselfthroughthischanneltoreachyoungertargets.
In 2012, the marketer launches Kiss of Style Design Contest exclusively on its
Facebookpagetopromoteitsproductsandthemarketerisexpectedtocontinuewith
suchactivitiestoengageconsumerswiththecompanysproducts.
Themarketerplanstoenhanceitsresearchanddevelopmentactivitiesacrosscategoriesto
strengthenitssalesovertheforecastperiod.
In the coming years, the marketer is expected to focus on its research and
developmentactivitiesacrossitssixcorecategories(asdefinedbythecompany):body
washes, sun care products, mens skin care products, skin care products, fragrances,
andshowerproducts.
Thecompanywillcontinuetofocusonenhancingitspresenceintheemergingmarketsover
theforecastperiod.
ThemarketerconstructsanewproductioncenterinSilao,Mexicotomeettherapidly
growingdemandforskincareproductsintheregion.
Beiersdorf will continue to focus on exploring new geographies to support its overall
sales over the next five years. Such endeavors will remove its focus from the U.S.
market.
Themarketerisexpectedtolaunchnaturallypositionedproductstostrengthenitsposition
inthenaturalsegmentovertheforecastperiod.
In 2012, the marketer launches La Prairie Cellular Power Complex in the facial
treatments category. The product contains natural ingredients including ginseng root
extractandhorsetailextract.
The marketer will continue to focus on incorporating more natural ingredients in its
productsacrosscategoriesincludingpersonalcleansingproductsandskincareproduct
categories.
SalesforBeiersdorfscosmeticsandtoiletriesareprojectedtoreach$376millionby2017,
upataCAGRof1.8%from$344millionin2012.
4A38
Beiersdorf
ToiletriesforBeiersdorfbyCategory,2012to2017
Category
CAGR,%
Facialtreatments
2.8
2.5
2.2
Shavingproducts
2.0
COMPANYAVERAGE
1.8
Handandbodylotions
1.5
Fragrancesformen
0.8
0.1
539
540
Beiersdorf
4A40
CHANEL
Table523:ChanelsSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
Category/brand
FRAGRANCESFORWOMEN
CocoMademoiselle
ChanelNo.5
ChanceEauTendre
Chance
ChanceEauFraiche
Coco
CocoNoir
Allure
AllureSensuelle
BvlgariPourFemme
ChanelNo.19
Total
FACIALTREATMENTS
Chanel
FRAGRANCESFORMEN
Bleu
PlatinumEgoiste
BvlgariMan
AllureHomme
AllureHommeSport
AllureHommeExtreme
Allother
Total
EYEMAKEUP
Chanel
FACEMAKEUP
Chanel
Chanel
NAILPOLISHES
Chanel
HANDANDBODYLOTIONS
Chanel
TOTAL
$Million
2011
2012
52
44
18
15
10
10
7
1
1
1
159
70
42
3
3
3
3
2
56
49
42
58
48
20
16
11
10
8
7
1
1
1
181
77
45
4
3
3
3
3
2
63
50
46
32
35
2
417
2
461
542
Chanel
COMPANYOVERVIEW
ChanelS.A.wasfoundedin1909bythelatecouturierCocoChanel.
Chanel is a global manufacturer and supplier of luxury goods, such as readytowear
jewelry,accessories,handbags,fragrances,makeup,andskincareproducts.
ItsheadquartersislocatedinNeuillysurSeine,France.
ItsU.S.administrativeofficeislocatedinNewYork,NY.
Itemploysapproximately3,200employeesworldwide.
Chaneloperatesover310Chanelboutiquesworldwide.
Itincludes128boutiquesintheUnitedStates,94inAsia,70inEurope,10intheMiddle
East,2inSouthAmerica,and6inOceania.
It has its own network of 95 companyowned retail stores and 135 Chanel shopin
shops.
Thesearelocatedinupscaleshoppingdistricts,upscaledepartmentstoresandmalls,
andmajorairports.
IntheUnitedStates,thecompanyoperatesboutiquesinNewYorkCity,BeverlyHills,
Boston,SanFrancisco,Houston,Dallas,BalHarbour,PalmBeach,Chicago,Waikiki,and
Honolulu.
ChanelalsoownsEresandParaffection,twoleadingapparelcompaniesbasedinParis.
Chanelisaprivatelyheldcompanyanddoesnotdiscloseitsfinancialinformationpublicly.
Corporate sales for the company are estimated to increase at a rate of 6.9% from
$2.9billionin2011to$3.1billionin2012.
ThecompanystotalcorporatesalesintheUnitedStatesareestimatedtoincrease9.9%in
2012,upfrom$644millionin2011to$708millionin2012.
IntheUnitedStates,Chanelscosmeticsandskincareproductsaredistributedthrough
855stores,whilefragrancesaresoldthroughapproximately3,500doors.
The companys U.S. sales in the cosmetics and toiletries market grow by 10.6% from
Since 2007, sales for the company have grown at a compound annual growth rate
(CAGR)of6.5%.
4A42
Chanel
Table524:ChanelsSalesofCosmeticsandToiletriesinthe
Year
$Million
Change,%
2007
336
2008
312
(7.1)
2009
292
(6.4)
2010
346
18.5
2011
417
20.5
2012
461
10.6
The fragrance product class commands 52.9% of the companys total sales in the U.S.
cosmeticsandtoiletriesmarketin2012.
Chanel holds a 6.4% market share in the fragrance class in 2012, increasing
considerablyfrom5.9%in2011.
Salesoftheproductclassgrowfrom$215millionin2011to$244millionin2012,an
increaseof13.5%.
Table525:CosmeticsandToiletriesBrandsofChanelintheUnitedStates,2012
Division/brand
CHANEL
Allure
AllureHomme
AllureHommeSport
AllureSensuelle
AntaeusPourHomme
Bleu
Chance
ChanceEauFraiche
ChanceEauTendre
Chanel
ChanelNo.19
BvlgaripourFemme
ChanelNo.5
ChanelPourMonsieur
ChanelPrecision
Coco
CocoMademoiselle
Egoiste
EgoistePlatinum
LightBluePourHomme
CocoNoir
AllureHommeExtreme
Product
Fragrances/toiletriesforwomen
Fragrances/toiletriesformen
Fragrancesforwomen
Fragrancesformen
Fragrancesforwomen
Makeup,nailpolishes,skincareproducts
Fragrancesformen
Facialtreatments
Fragrancesformen
Fragrancesforwomen
Fragrancesformen
543
544
Chanel
Thefragrancesforwomenproductcategorygenerates39.3%ofthecompanyssalesinthe
fragrance product class in 2012, mainly driven by the classics such as Chanels Coco
MademoiselleandChanelNo.5brands.
Salesofwomensfragrancesgrowfrom$159millionin2011to$181millionin2012,up
by13.8%.
Chanelmarketsallofitsproductsintheluxurytradeclass,whereitisthethirdlargest
marketer.
Chanelpossesses6.7%marketshareinthewomensfragrancecategoryand11.4%in
theluxurytradeclassofthiscategoryintheU.S.marketin2012.
Coco Mademoiselle continues to be the top brand for the company in this category
with $58million in sales, or 12.6% of the total. Chanels Coco Mademoiselle is the
leaderintheluxurysegmentinthefragrancesforwomenproductcategory.
The brand is supported with magazine and television advertising, along with online
supportduringtheholidaypurchasingtimes.
A new broadcast advertising campaign premieres in 2012 featuring actress Keira
Knightley.
Facial treatments is the secondlargest contributor to the companys cosmetics and

toiletriessales,with16.7%ofthetotalsalesin2012,alsodecreasingitsshareslightlyfrom
16.8%in2011.
Salesincreaseby10.0%,from$70millionin2011to$77millionin2012.
Thecategorybenefitsfromconsumerswillingtospendmoreonluxuryproducts.
Makeupproductsisthesecondlargestproductclassforthecompanyin2012.
It experiences a 6.2% increase in sales, from $130million in 2011 to $138million in
2012.
Eye makeup continues to be the largest makeup category for the company in 2012,
generating 36.2% of the companys cosmetics and toiletries sales in the makeup
productclass.
Salesintheeyemakeupcategorygrowby2.0%in2012.
Chanelisrankedfourthintheluxuryeyemakeupproductcategory,with5.7%market
sharein2012,downfrom5.9%in2011.
Thecompanypostsastronggrowthof9.5%inthefacemakeupcategoryin2012,from
Thecompanyranksfourthintheluxuryfacemakeupcategory,with$46millioninsales
in2012anda4.2%marketshare.
The company is ranked third in the luxury lipsticks and lip glosses category with
$35millioninsalesin2012and7.1%marketshareintheproductcategory.
Chanelranksthirdintheluxurynailpolishescategorywithsalesof$7millionin2012.
4A44
Chanel
Fragrancesformencontinuestobeanimportantcategoryin2012.
Salesofmensfragrancesgrows12.5%from$56millionin2011to$63millionin2012.
It is the thirdlargest category for Chanel, increasing its share from 13.4% in 2011 to
13.7%in2012.
The company jumps from fifth position in the category to fourth and increases its
marketsharefrom5.3%in2011to5.7%in2012.
ChanelssalesgrowthinthecategoryisbasedonthesuccessofitsbrandBleu,which
continuestogrow.
Bleusshareofthetotalmensfragrancemarketis4.1%during2012,upfrom4.0%in
2011,andthebrandsshareoftheluxurytradeclassin2012growsto5.9%,from5.8%
in2011.
RECENTDEVELOPMENTS
TherearenonotablerecentdevelopmentsforChanel.
Newproducts
Table526:SelectNewProductsIntroducedbyChanelintheUnitedStatesin2012
Brand
Category
Description
Chanel
Fragrancesformen
AllureHommeExtremeisthenewestextensionintheAllurelineand
includesmuskyshades,tartspices,aromaticfreshness,andwoodyaccords
CocoNoir
Fragrancesfor
women
Chanelsnewscentwithtopnotesofgrapefruit,andCalabrianbergamot
followedbyaheartofrose,narcissus,rosegeraniumleaf,andjasmine
MARKETINGACTIVITY
In2012,Chanelincreasesitsspendingonadvertisingandpromotionalactivities,withTME
of$86.6millioncomparedto$77.8millionin2011,anincreaseof11.3%.
The marketer primarily uses broadcast media, such as television, print, and Internet
advertisements,topromoteitsproducts.
ChaneladvertisesinleadingfashionmagazinessuchasVogue,Redbook,andAllure.
545
546
Chanel
Chanelspends87.8%ofitsmediabudgetonitsfragrancescategoryin2012,upfrom77.2%
in2011.
In 2012, most of the expenditures, or almost $25 million are allocated to Bleu de
Chanel.
Alargeshareofthe24.4%isspentontheCocoMademoisellebrandin2012.
Almost 59.1% of the total media spending in the category is spent on womens
fragrancesin2012.
ChanelsBleuscentformencontinuestoreceivealotofeditorialmentioninfashion
andmenspublicationsduring2012.
Brad Pitt fronts a new print and broadcast campaign for Chanel No.5 and is the only
malespokespersonforafemalescent.
AnewbroadcastadvertisementforChanelsCocoMademoisellefeaturesactressKeira
Foritsfirstfullyearoncounter,ChanelcontinuestosupportthelaunchofBleuwith
nationalprintadvertisements,televisionadvertisingfromfilmdirectorMartinScorsese,
aYouTubevideo,andanonlinecampaign.
Themarketerutililizesflashretailing(popupstores),openingsalesshopsforashortperiod,
inordertopromotesales.
Themarketeropensthesestoresincitycentersorpopularplaceswhereitcanengage
withconsumersbypromotingitsproducts.
Chanel promotes its products through social media channels including Facebook, Twitter,
andYoutube.
ThemarketeradvertisesitsnewproductsonitsFacebookpagetosupportitssales.
Details on traceable media expenditures (TME) are provided in the Advertising section of
thisreport.
OUTLOOK
Chanelisexpectedtopostmoderategrowthof2.5%inthecosmeticsandtoiletriesindustry
overthenextfiveyears,2012to2017.
Newproductlaunchesacrosscategorieswillcontinuetosupportthemarketersgrowth
Themarketerwillcontinuetopartnerwithpopularcelebritiesanddesignerstosupport
itssales.
Consumersareslowlyopentopurchasingluxuryproductsthatwillsupportthesalesof
themarketeroverthenextfiveyears.
4A46
Chanel
Thefacialtreatmentscategoryisexpectedtopostthestrongestgrowthof3.5%forChanel
Growing demand for antiaging and antiacne products will support the marketers
Newproductlauncheswithbettertechnologiesandclaimsareexpectedtosupportthe
marketersgrowthinthenextfiveyears.
The marketer will continue to look beyond its core channel of distribution for more
sales.
Chanel is expected to support its sales through home shopping channels and the
Internet.
Chanel will continue to focus on this category, considering the increasing consumer
demandinthiscategoryandinclinationtohavegood,healthyskin.
ThemakeupproductclassisexpectedtoperformwellforChanelovertheforecastperiod.
Theeyemakeupandfacemakeupcategoriesareexpectedtobethebestperfomersin
themakeupproductclassoverthenextfiveyears.
Themarketerplanstolaunchnewproductsandimproveitsexistingbrandstosupport
itsales.
Chanelisexpectedtoprovidenewvariationstothetraditionalpressedpowderblushin
forms,suchaswhippedcream,sticks,andliquidtints.
shineareexpectedtosupportthefacemakeupcategorysgrowth.
Thefragrancesproductclasswillcontinueto bethelargestrevenuegeneratorforChanel
Thecorebrandsofthemarketer,BleuandCocoMademoiselle,areexpectedtodrive
thesalesofthemarketer.
The marketer plans to increase its media spend on these brands to support its sales
overthenextfiveyears.
Theseproductsalsohavealoyalconsumerbase,whichwilllikelysupportsales.
Chanel plans to introduce new fragrances and existing products in new forms to
supportitssales.
Thecompanywillcontinuetosignagreementswithcelebrities,designers,artists,and
entertainerstolaunchnewbrandsorpromoteexistingbrandextensions.
The marker will also continue to feature celebrities, such as Brad Pitt and Keira
Knightley,initsadvertisementstopromotethesalesofitsproducts.
Chanelplanstoenternewmarketsandgeographiesovertheforecastperiod.
The company plans to open up more of its companyowned boutiques and shopin
shopstoresinthenextfewyears.
547
548
Chanel
Chanelwillcontinuetoenhanceitsresearchanddevelopmentactivitiesacrosscategoriesto
supportitssalesoverthenextfiveyears.
Thecompanyplanstopartnerwithexpertsandscientistsinplantbiologytodevelopa
lineofnaturalandorganicingredientsthatcanbeincorporatedintoitsproducts.
Chanelwillcontinuetoincreasethemediaspendingforitsproductsacrosscategoriesover
theforecastperiodtosupportitssales.
Thecompanywillcontinuetoutilizeinnovativetools,suchassocialwebsitesandother
toolsoftheInternet,tocommunicatewithconsumersmoreeffectivelyandquickly.
Chanel will continue to conduct various marketing and promotional campaigns to
attractconsumers.
The marketer is likely to support its new product introductions with high media
expenditurestosupportitssales.
Sales for the company are expected to grow at a CAGR of 2.5% to reach $522million by
Table527:ForecastDollarSalesGrowthofCosmeticsandToiletries
forChanelbyCategory,2012to2017
Category
CAGR,%
Facialtreatments
3.5
Facemakeup
2.5
COMPANYAVERAGE
2.5
2.0
Eyemakeup
1.5
Nailpolishes
1.0
Fragrancesforwomen
1.0
Fragrancesformen
1.0
Handandbodylotions
0.2
4A48
CHURCH&DWIGHT
Table528:Church&DwightsSalesofCosmeticsandToiletriesintheUnitedStates,2011and
2012
$Million
Category/brand
2011
TOOTHPASTES
2012
Arm&Hammer
82
83
Aim
19
19
Orajel
17
16
Mentadent
14
12
CloseUp
14
13
Pepsodent
12
11
158
154
Arrid
45
43
Arm&Hammer
23
23
69
66
48
45
42
45
321
313
Total
LadysChoice
Total
TOOTHBRUSHES
CrestSpinBrush
Nair
Arm&HammerWhiteningBooster
TOTAL
550
Church&Dwight
COMPANYOVERVIEW
Church&Dwight,foundedin1846,marketsandmanufacturesawiderangeofhousehold,
personalcare,andspecialtyproducts.
ItisheadquarteredinPrinceton,NJ.
AsofDecember31,2012,thecompanyemploys4,354staff.
The company conducts its research and development at its Princeton and Cranbury
facilitiesinNewJersey.
The core focus of the company is on its power brands, Arm & Hammer, Trojan
Condoms,Xtralaundrydetergent,Oxicleanprewashlaundryadditive,Nairdepilatories,
FirstResponsepregnancyandovulationtestkits,Orajeloralanalgesics,andSpinBrush,
abatteryoperatedtoothbrush.
The companys business is divided into three segments: consumer domestic, consumer
international,andspecialtyproducts.
The consumer domestic segment has eight power brands which includes household
and personal care products such as Scrub Free, Kaboom, and Orange Glo cleaning
products, Answer home pregnancy and ovulation test kits, Arrid antiperspirant, and
CloseUpandAimtoothpastes.
Theconsumerinternationalsegmentsellsavarietyofpersonalcareproducts,someof
which are also sold in the domestic product line in international markets of Canada,
France,Australia,theUnitedKingdom,Mexico,Brazil,andChina.
The specialty products segment primarily produces sodium bicarbonate and other
inorganicchemicalsforindustrial,institutional,medical,andfoodapplications.
Church&Dwightssalesincrease6.3%from$2,749millionin2011to$2,922millionin2012.
Netprofitsriseby13.0%to$349.8millionin2012,upfrom$309.6millionin2011.
Table529:Church&DwightsGlobalCorporateSales,2007to2012
$Million
Year
Sales
Netprofits
Marginonsales
2007
2,220.9
169.0
7.6
15.6
2008
2,422.4
195.2
8.1
18.1
2009
2,520.9
243.5
9.7
15.2
2010
2,589.2
270.7
10.5
15.6
2011
2,749.0
309.6
11.2
15.2
2012
2,922.0
349.8
11.9
17.0
4A50
Returnonequity
Church&Dwight
The consumer products segment achieves sales of $2,667.0million in 2012, growing
7.2%from$2,488.2millionin2011.
DollarsalesintheconsumerproductssegmentadvanceataCAGRof6.3%since2007.
Table530:Church&DwightsProductSegmentSales,2007to2012
$Million
Year
Consumer
products
Specialty
products
Total
2007
1,962.4
258.5
2,220.9
2008
2,137.0
285.4
2,422.4
2009
2,275.4
245.5
2010
2,330.1
2011
2012
%Oftotal
Consumer
products
Specialty
products
Total
88.4
11.6
100
88.2
11.8
100
2,520.9
90.3
9.7
100
259.1
2,589.2
90.0
10.0
100
2,488.2
261.1
2,749.3
91.6
9.4
100
2,667.0
254.9
2,921.9
91.3
8.7
100
Domesticsalesofconsumerproductsrepresent74.0%ofthecompanystotalsalesin2012.
Table531:Church&DwightsGlobalSalesbyBusinessSegment,2011to
2012
%Oftotalsales
Businesssegment
2011
2012
Household
47
48
Personalcareproducts
25
26
Total
72
74
CONSUMERINTERNATIONAL
19
17
100
100
CONSUMERDOMESTIC
SPECIALTYPRODUCTS
TOTAL
TotalsalesforChurch&Dwightscosmeticsandtoiletriesaredown2.5%to$313millionin
2012from$321millionin2011.
Since2007,saleshavedeclinedataCAGRof2.1%.
551
552
Church&Dwight
Table532:Church&DwightsCosmeticsandToiletries
SalesintheUnitedStates,2007to2012
Year
$Million
Change,%
2007
347
2008
361
4.0
2009
366
1.4
2010
339
(7.4)
2011
321
(5.3)
2012
313
(2.5)
ThetoothpastescategoryisChurch&Dwightslargestcategory,withsalesof$154million
in2012,downby2.5%from$158millionin2011.
In the toothpastes category, Church& Dwight remains in fourth place with an 8.8%
marketshare,downfrom9.2%in2011.
Lackofnewproductsandpromotionalactivitiescontributestothemarketersdeclinein
Arm&Hammer,thecompanysleadingbrand,hasa4.7%marketshare.Salesareupby
The introduction of multibenefit toothpastes under the Arm & Hammer brand
supportsthemarketersbrandsgrowthin2012.
During2012,Church&DwightlaunchestwosignificantnewproductsundertheArm&
Hammerbrandinthetoothpastescategory:AdvancedWhiteBakingSoda&Peroxide
FreshMinttoothpasteandOrajelSensitivetoothpaste.
Deodorants and antiperspirants are the secondlargest product category for the company
withtotalsalesof$66millionin2012,down4.3%from$69millionin2011.
Thecompanymarketstwokeybrands:ArridandArm&Hammer.
ThemarketerdiscontinuesLady'sChoice,whichcontributestothemarketersdecline
inthecategory.
Arridistheleadingbrandforthecompanywithsalesof$43millionin2012,downby
SalesofArm&Hammerremainflatat$23millionin2012,constantwith2011levels.
Church&Dwightsthirdlargestproductcategoryistoothbrushes.
Salesofthecategorydeclineby6.3%in2012to$45millionfrom$48millionin2011.
Thecompanysmarketsharedecreasesfrom6.6%in2011to6.1%in2012.
The introduction of a privatelabel brand, similar in design and functionality to the
SpinBrush,butpricedsignificantlylower,istheprimarycauseforthedrop.
Church & Dwight discontinues all Mentadent toothbrushes except one, significantly
paringthebrand.
4A52
Church&Dwight
Sales of Church & Dwights depilatories, waxes, and bleaches category grow 7.1% from
Naircontinuestobethesecondleadingbrandinthecategory,withsalesat$45million
in2012.
Nair accounts for 27.6% of total depilatories, waxes, and bleaches categorys sales in
2012,downfrom29.2%in2011.
Thekeyreasonforthemarketershealthygrowthin2012isaccreditedtothelaunchof
itsBrazilianSpaClaylineofproducts.ThelinecomprisesBrazilianSpaClayBodyCream,
BrazilianSpaClayRollOnWax,andBrazilianSpaClayFaceCream.
Nairsportfolioofproductsforwomenincludesinshowerproducts,waxes,andcreams
and gels. These products are available in different variants with some especially
designedasasensitiveformula.
NairsproductofferingsformenarelimitedtotheNairForMenSpray,InShowerNair
For Men, and Nair For Men Body Cream, since depilatories for men is still a niche
segment.
The sales of Church & Dwights Arm & Hammer brand in the tooth whitening products
categorydeclineby25.0%from$4millionin2011to$3millionin2012.
Toothwhiteningproducts,ingeneral,declinedin2012,mainlyduetocompetitionfrom
whiteningtoothpastesandmouthwashes.
RECENTDEVELOPMENTS
Mergers,alliances,andacquisitions
InOctober2012,Church&DwightannouncesthatithascompleteditsacquisitionofAvid
Health for $650.0 million. Avid Health markets nutritional supplements, mostly in the
gummyformat.
Managementchanges
InFebruary2012,thecompanyannounceschangeswithinitsSpecialtyProductsdivision.
Curt Siverling is promoted to the position of President, Specialty Products Division,
effective March 2012. He was responsible for leading Church & Dwights Specialty
ChemicalsandAnimalNutritionbusinesses,aswellasbeingaboardmemberonthree
jointventurecompanies.
Scott Druker is promoted to the position of Director, Animal Nutrition, assuming
generalmanagerresponsibilitiesofArm&HammersAnimalNutrition.
553
554
Church&Dwight
Newproducts
Table533:SelectNewProductsIntroducedbyChurch&DwightintheUnitedStatesin2012
Brand
Category
Description
Arm&Hammer
Toothpastes
Arm&HammerAdvancedWhiteBakingSoda&PeroxideFreshMint
toothpasteisspecificallyformulatedwithrefineddentalgradebaking
sodatopreventnewstainbuildupinteeth.Apartfromdeepcleaning,
italsocontrolstartarandremovesplaque
Arm&Hammer
ToothTunes
Toothbrushes
ToothTunesisamanualtoothbrushthatplayspopularcommercial
musicfortwominutestoencourageproperbrushing
Nair
Depilatories,
waxes,and
bleaches
BrazilianSpaClayBodyCreamisenrichedwithmangobutter,acai
berry,mineralrichclay.InfusedwiththeShowerPowerTechnology
whichhelpspreventthecreamfromrinsingoffwhileintheshower.
Additionally,theconvenientpumpandspongemakestheapplication
andthehairremovalprocesseasyandhandsfree
Nair
Depilatories,
waxes,and
bleaches
BrazilianSpaClayRollOnWaxisinfusedwithmangobutter,acai
berry,andmineralrichclay.Itcomeswitharollonapplicatorfora
messfreeapplication
Nair
Depilatories,
waxes,and
bleaches
BrazilianSpaClayFaceCreamisenrichedwithmangobutter,acai
berry,andmineralrichclaygivessmoothhairfreeskinwithinaslittle
asfiveminutes,dermatologicallytested
MARKETINGACTIVITY
Church& Dwight spends $65.7 million in advertising and promotional activities in 2012,
down7.9%from$71.3millionin2011.
Various promotional tools used by the company to promote its products include
sampling, couponing, media advertising, temporary price reductions, and other
consumerincentives.
In 2012, Church & Dwight allocates $38.7 million to its Arm & Hammer toothpastes,
withthefundingspreadacrosstelevisionandmagazineadvertisements.
Themarketerallocatesalmost$28.0milliontopromoteitsArm&Hammerwhitening
toothpastein2012.
Church & Dwight promotes SpinBrush mainly through television commercials and
magazines.
Thecompanyspendsabout$15.6milliontopromoteitstoothbrushescategoryin2012.
The company primarily uses television and magazine advertisements to promotes its
toothbrushes.
In the depilatories, waxes, and bleaches category, Church & Dwights decreases its
traceablemediaexpenditures(TME)to$6.9millionin2012from$7.4millionin2011,
down6.8%.
Majority of the TME at $4.3million, is spent on television advertisements. Television
advertisementexpendituresaccountfor62.3%ofthetotalTME.
Themarketeralsospends$2.2milliononmagazineadvertisements.
TheNairBrazilianSpaClayhairremovalcreamreceivesmajorportionofthebrands
TMEat$2.4millionin2012.
4A54
Church&Dwight
Church&Dwightoffersdiscountcouponsthroughwebsites,magazines,andnewspapersas
apartofitspromotionalstrategy.
ThecompanysupportsitsNairbrandinthedepilatories,waxes,andbleachesproduct
linewith$8.0millionasTMEin2012.
Nairs website offers a discount coupon of $3.00 on the purchase of any two Nair
products.
Church&DwightsaugmentsitstraditionalmarketingactivitieswithInternetmarketing.
NairswebsiteofferswriteupsontheadvantagesofusingathomeNairhairremoval
productsovervisitingsalons,guidetoobtainingbeautifulskin,andotherinformation
ontheuseofproducts.
Nairs men and women products are classified separately on its website, making it
easierforconsumerstotracetheproductappropriateforthem.
Church&DwightisalsoavailableonsocialmediasitessuchasFacebookandYoutube
forinstantacceptanceamongconsumers.
Themarketeradvertisesitsnewproductsandexistingproductsonthesemediumsto
engageconsumersinterest.
Arm&Hammeruserscanregisterforthebrandsnewsletteronitswebsitebyfillingina
simpleform.
Signing up for the newsletter provides members benefits, such as opportunities to
previewandshopfornewproductsanddiscountsonnewandexistingproducts.
OUTLOOK
ThecompanyssalesatthemanufacturerlevelareforecasttogrowmoderatelyataCAGR
of0.3%overtheforecastperiod,2012to2017.
Totalcosmeticsandtoiletriessalesareprojectedtogrowfrom$313millionin2012to
$318millionin2017.
Church&Dwightisexpectedtoregainitszealforintroducingnewerproducts,gainingmore
stanceinallthecategoriesthatitcompetesin.
The company is expected to launch innovative products such as Tooth Tunes battery
operated toothbrushes that claim to come with a proprietary technology that will
deliver music while brushing. This is expected to support the companys overall sales
The company is likely to launch innovative products in all its categories, including
toothpastes,toothbrushes,anddepilatories,waxes,andbleaches.
The company will also focus on marketing its key brandsArm & Hammer, Orajel,
SpinBrush,andNairintheforecastperiodtokeepupitsrevenuesintherespective
categories.
Furthermore, Church & Dwight will likely benefit from providing more promotional
supporttoitsproductportfolio.
Newacquisitionsareanotherwaytohelpleveragethestrengthofitsdiverseproduct
portfoliowhichconsistsofpremiumbrandsandvaluebrands.
555
556
Church&Dwight
Themarketerplanstoadoptcostsavingprogramsovertheforecastperiodtosupportthe
positivegrowthofthecompany.
The oral care product class will continue to be the largest revenue generator for the
marketerovertheforecastperiod.
Church&Dwightplanstolaunchinnovativeproductswithmultibenefitsunderitsoral
care product categories including toothpastes, toothbrushes, and mouthwashes to
supportitssales.
Moreover, the marketer will continue to increase its TME spend on the oral care
productclasstosupportitssalesovertheforecastperiod.
However, further growth of the marketer in the oralcareproduct class will be offset
duetoitspresenceinthematurecategoriesincludingtoothpastes,toothbrushes,and
mouthwashes.
The two flagship brands, Nair and Arm & Hammer, are expected to generate the highest
revenuesforthecompanyovertheforecastperiod.
Church & Dwight plans to launch innovative products under these brands to support
salesandprovideaggressivepromotionalsupporttotheseproductofferings.
Furthermore,themarketerislikelytointroducemoreproductsspecifictomentocater
tothegrowingdemandofmalegroomingproducts,therebysupportingitssalesgrowth.
Table534:ForecastDollarSalesGrowthofCosmeticsandToiletriesfor
Church&DwightbyCategory,2012to2017
Category
CAGR,%
1.6
COMPANYAVERAGE
0.3
Toothpastes
0.2
Mouthwashes
0.3
0.2
0.2
Toothbrushes
0.1
4A56
CLARINS
Table535:ClarinsSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
2012
68
71
Angel
25
27
Alien
Womanity
33
37
18
19
Chrome
10
AngelMen
Allother
11
14
13
13
160
171
FACIALTREATMENTS
Clarins
FRAGRANCESFORWOMEN
Total
FACEMAKEUP
Clarins
FRAGRANCESFORMEN
Total
SUNCAREPRODUCTS
Clarins
ClarinsMen
EYEMAKEUP
Clarins
Clarins
HANDANDBODYLOTIONS
Clarins
SHAVINGPRODUCTS
ClarinsMen
TOTAL
558
Clarins
COMPANYOVERVIEW
Clarins is a French cosmetics company headquartered in NeuillysurSeine, France,

specializing in skin care products, makeup, and fragrances. The company was founded in
1954.
The marketer was founded by Jacques CourtinClarins with the development of the
ClarinsInstitutedeBeautinParisin1954.
The companys global distribution network includes 20 subsidiaries, 19,000 retail
venues,andextendedpresenceinnearly150countries.
Clarinsemploysabout6,100employeesworldwidein2012.
Thecompanyisprivatesinceitsdelistingin2008.
Clarinsisdividedintotwobusinesssegments:ClarinsBrandandClarinsFragrancesGroup.
ClarinsBrandincludesthecompanysmakeupandskincareproducts.
TheClarinsFragrancesGroupcomprisesthefragrancebrands,includingThierryMugler,
ModeetPatrimoine,Azzaro,PorscheDesign,andSwarovski.
The company does not disclose its financial information after it became a private
organizationin2008.
Clarins corporate sales are estimated to increase by 8.2% from 1,135million

($1,458million)in2011to1,228million($1,578million)in2012.
Table536:ClarinsGlobalSalesofCosmeticsandToiletries,
2007to2012
Year
Million
Change,%
2007
1,008
2008
975
(3.3)
2009
965
(1.0)
2010r
1,045
8.3
2011r
1,135
8.6
2012
1,228
8.2
rRestated.
NOTE:$1.00=0.7781.
4A58
Clarins
The companys sales of cosmeticsand toiletries products in the United States increase by
6.9%,from$160millionin2011to$171millionin2012.
SaleshaveincreasedataCAGRof2.3%since2007.
Table537:ClarinsSalesofCosmeticsandToiletries
Year
$Million
Change,%
2007
153
2008
146
(4.6)
2009
136
(6.8)
2010
142
4.4
2011
160
12.7
2012
171
6.9
The companys portfolio includes fragrances for men and women, makeup products, and
skincareproducts.
Table538:ClarinsCosmeticsandToiletriesBrandsintheUnitedStates,2012
Brand
Productcategory
Alien
Fragrancesforwomen
Angel
Fragrancesforwomen
AngelMen
Fragrancesformen
Chrome
Fragrancesformen
Clarins
Facialtreatments,fragrances,makeup,handandbodylotions,suncareproducts
ClarinsMen
Skincareproductsformen,deodorants,shampoos,shavingproducts
Womanity
Fragrancesforwomen
Facialtreatmentsarethelargestcategoryforthecompany,accountingfor41.5%ofitstotal
salesinthecosmeticsandtoiletriesmarketin2012.
Sales of Clarins in the category advance 4.4% to reach $71 million in 2012, up from
$68millionin2011.
Themarketercontinuestoloseshareinthecategorywithadipof1.0%from42.5%in
2011 to 41.5% in 2012. Introduction of new products is the primary reason for the
positivegrowthinthecategory.
In2012,themarketerintroducestheSuperRestorativeTotalEyeConcentrate.
559
560
Clarins
Thecompanysmarketshareintheoverallfacialtreatmentscategoryremainsat1.1%
in2012,flatfrom2011levels.
The marketer maintains the eighthleading position in the luxury trade class in the
facialtreatmentsproductscategoryin2012.
Clarinsrangeofproductsinthecategoryincludescleansers,toners,facetreatmentoils,
serums,moisturizers,andantiagingproducts.
Womensfragrancesisthesecondlargestproductcategoryforthemarketer,accountingfor
21.6%ofthecompanyssalesin2012.
Sales in the category continue to increase with growth of 12.1% from $33 million in
Angel continues to be the leading brand for Clarins in the fragrances for women
category,withsalesup8.0%from$25millionin2011to$27millionin2012.
Clarinsmarketshareinthefragrancesforwomencategoryisupmarginallyby0.1%to
1.4%in2012,from1.3%in2011.
Facemakeupproductsisthethirdlargestproductcategoryforthecompanywithsalesup
Sales of the marketer in the face makeup products category represent 11.1% of the
companysentiresalesin2012,downfrom11.3%in2011.
Thecompanysmarketshareinthefacemakeupproductcategoryis0.7%in2012.
In2012,themarketerintroducestheEverlastingCompactFoundationSPF15.
Clarinssalesinthefragrancesformenproductscategorygrow27.3%toreach$14million
in2012,upfrom$11millionin2011.
Salesinthefragrancesformenscategoryrepresent8.2%ofthemarketerstotalsales
in2012.
With sales at $10 million in 2012, up 11.1% from $9 million in 2011, Chrome is the
marketerslargestbrandinthecategoryin2012.
In2012,Clarinshasa1.8%marketshareintheluxurytradeclassofmensfragrances,
upfrom1.5%in2011.
Clarinsalsomarksitspresenceinsixothercategoriesinthecosmeticsandtoiletriesmarket
in2012.
Thesecategoriesincludesuncareproducts,skincareproductsformen,eyemakeup,
lipsticksandlipglosses,handandbodylotions,andshavingproducts.
Thesesixcategoriestogetheraccountfor$30millioninsalesor17.5%ofthemarketers
salesin2012.
Shavingproductsisthesmallestcategoryforthemarketerwithsales at$1millionin
4A60
Clarins
RECENTDEVELOPMENTS
Therearenonotabledevelopmentsin2012.
Partnershipsandagreements
Therearenopartnershipsoragreementsin2012.
Newproducts
Table539:SelectNewProductsIntroducedbyClarinsintheUnitedStatesin2012
Brand
Category
Description
Clarins
Facemakeup
EverlastingCompactFoundationSPF15.Awetanddrytexturewhichissaid
toprovideaflawlessfinishandlasts15hours
Clarins
Facialtreatments SuperRestorativeTotalEyeConcentrateisatripleactionserumfortheeye
areathatlifts,depuffs,andreplenishes
MARKETINGACTIVITY
The companys total traceable media expenditures (TME) for cosmetics and toiletries
increase16.7%from$22.8millionin2011to$26.6millionin2012.
Printadvertisementsinleadingandfashionandbeautymagazines,suchasAllure,Elle,
Vogue, Teen Vogue, and Harpers Bazaar, receive the largest TME support at
$21.5millionin2012.Themarketerspends80.8%oftheTMEonprintadvertisements
in2012,followedbytelevisionspots.
TelevisionspotsreceiveaTMEsupportof$4.4millionin2012.
Majority of Clarins TME, at almost 66% of total TME, is allocated to its fragrances
productclass.TheproductclassreceivesaTMEspendingof$17.5millionin2012,up
ClarinsisallocatedaTMEof$4.9milliononpromotingitsfacialtreatmentproductsin
2012.
ThecompanysleadingbrandintermsofadvertisingexpendituresisThierryMuglersAngel
withaTMEof$10.5millionin2012.
TheClarinswebsiteoffersspecialoffersintheformofdiscountsandalsoallowsconsumers
to sign up for its newsletters to receive special offers and news about new product
introductions.
The website also offers customized suggestions to customers in the form of beauty
advice,applicationmethods,andonlineconsultations.
TheMyFaceBeautyConsultationoptionavailableonthecompanyswebsiteallows
consumerstofindtheiridealbeautyroutinebyansweringafewsimplequestions.
561
562
Clarins
In 2012, Clarins organizes the Clarins Million Meal Concert for the FEED Foundation at
LincolnCentersAliceTullyHall.
Theconcertisacombinationofpopstarsandcontemporaryclassicalgreatsincluding
John Legend, Natasha Bedingfield, the PS22 Chorus, pianist Christoph Eschenbach,
violist David Aaron Carpenter, conductor Alan Gilbert, and the Salome Chamber
Orchestra.
The former U.S. President Bill Clinton made an appearance during the event, which
aimstoraiseenoughfor1millionschoolmeals,soastoliveuptothedreamofleaving
nochildintheworldwithoutfood.
OUTLOOK
ManufacturerssalesofClarinsareforecasttogrowatahealthyCAGRof3.4%duringthe
Clarins is expected to introduce new innovative products across the cosmetics and
toiletriescategories.Innovationcanbeintheformofimprovedpackaging,extending
productlines,innovativemarketingcampaigns,andadvancedtechnology.
TheTMEforthecompanyisexpectedtocontinuallyincreaseduringthenextfiveyears.
Effortswillalsobedirectedtowardsimprovingthesupplychainefficiencies.
Facial treatments will continue to be the leading product category for Clarins during the
forecastperiod.
The marketer is expected to introduce new products in the skin care product class,
helpingspursalesforthecompany.Itislikelytoregainitspositionastheleadingluxury
suncaremarketerthrough2017.
Antiaging facial treatments will remain a focus segment for Clarins as they gain
popularity with the growing baby boomer population, who become more intent on
preservingtheircomplexion.
Clarinswillcontinuetoformulateitsfacemakeupandfacialtreatmentproductswith
SPFingredients.Thiswillbeakeygrowthdriverforthecompanyintheforecastperiod,
asconsumersbecomeconsciousaboutsunexposureandtheharmfuleffects.
The fragrances product class will be the primary driver behind the healthy growth of the
companyduringtheforecastperiod.
Withimprovedeconomicconditions,consumerswillreturntopurchasingtheirfavorite
premiumpricedfragrances.
Celebrityscentsareexpectedtohavevitalityinthefuture,butthecompanymustbe
moreselectiveinthecelebrityitchooses.
Clarinsisanticipatedtoincreaseitsadvertisingspendingandisexpectedtoengageits
consumers through popular social media networks, such as Facebook, Twitter, and
YouTube.
4A62
Clarins
Clarinswillcontinuetodevoteincreasedexpendituretowardsitsresearchanddevelopment
initiatives.
The marketers research team will continue with their global quest to search for
powerfulnaturalactiveingredientstoincludeintheirproductformulationsinorderto
provideconsumersnewandinnovativetechnologicallyadvancedproductsthatdeliver
enhancedresults.
FurthergrowthofthecompanyintheU.S.cosmeticsandtoiletriesmarketwillberestricted
duetostagnatingperformanceinthehandandbodylotions,shavingproducts,eyemakeup,
andlipsticksandlipglossescategories.
Additionally,limitednewproducts,lackofinnovationintechnology,formulations,and
designs, and limited TME are likely to hamper growth of the company during the
forecastperiod.
ClarinssalesareprojectedtogrowataCAGRof3.4%duringtheforecastperiodendingin
2017toreach$202million,upfrom$171millionin2012.
Table540:ForecastDollarSalesGrowthofCosmeticsandToiletries
forClarinsbyCategory,2012to2017
Category
CAGR,%
Facialtreatments
4.1
Fragrancesformen
4.0
Fragrancesforwomen
3.5
COMPANYAVERAGE
3.4
Facemakeup
3.0
3.7
Suncareproducts
1.5
Eyemakeup
Handandbodylotions
Shavingproducts
563
564
Clarins
4A64
THECLOROXCOMPANY
Table541:TheCloroxCompanysSalesofCosmeticsandToiletriesintheUnited
States,2011and2012
$Million
Category/brand
2011
BurtsBees
53
58
35
37
29
30
27
29
BurtsBees
SHAMPOOS
158
172
BurtsBees
HANDANDBODYLOTIONS
BurtsBees
FACIALTREATMENTS
BurtsBees
BABYCAREPRODUCTS
BurtsBeesr
CONDITIONERS
BurtsBeesr
TOTAL
rRestated.
2012
566
TheCloroxCompany
COMPANYOVERVIEW
TheCloroxCompany,foundedin1913,isakeyplayerintheconsumerproductsindustry.
ThecompanysheadquartersislocatedinOakland,CA.
Itsemployeeheadcountisapproximately8,400worldwidein2012.
Thecompanymarkets24brandsunderitsproductportfolio.
It offers an extensive variety of products, including: bleach and cleaning products;
home care products; auto care products (glass cleaners, wax, and wipes); cat litter
products (clay, crystals, fresheners, and wipes); charcoal products; food products
(dressings and sauces); water filtration systems; plastic bags, wraps, and containers;
andnaturalpersonalcareproducts.
Italsohasapresenceintheinstitutional,healthcare,andfoodservicemarkets.
Itmanufacturesitsproductsinmorethan24nations,andmarketstheminmorethan
100countries.
Thecompanyoperatesandmarketsproductsacrossfourdistinctsegments:Cleaning,
Household,Lifestyle,andInternational.
The Clorox Company is present in all principal markets, such as North and Central
America,SouthAmerica,Europe,theMiddleEast,Asia,Africa,andAustralasia.
Thecompanyventuredintothepersonalcareproductssegmentwiththeacquisitionof
BurtsBees,aleadingmarketerofnaturalpersonalcareproducts.
Mass merchandisers, grocery stores, and other retail outlets are the companys primary
distributors.
It initiates improved communication about the products ingredients, given that
consumers today want to know what are in products they use in and around their
homes.
Burts Bees is among the fastestgrowing mass market brands in the cosmetics sector in
2012.
The brand experiences growth with added distribution, which includes a designated
BurtsBeesareainretailerssuchasTarget.Themarketerspositioningwithnaturally
formulatedproductsaidsinitsgrowthin2012.
Totalcompanyssalesare$5,468millionin2012,upby4.5%,from$5,231millionfor2011.
Corporatenetprofitsdecreaseby2.5%,from$557millionin2011to$543millionin2012.
Thecompanystotalsalesincreaseatacompoundannualgrowthrate(CAGR)of2.4%
from$4,847millionin2007to$5,468millionin2012.
TheCloroxCompanyderivesalmost79%ofitssalesfromtheUnitedStates.
4A66
TheCloroxCompany
Table542:TheCloroxCompanysGlobalCorporateSales,2007to2012
$Million
Yeara
Sales
Netprofits
Marginonsales
Returnonequity
2007
4,847
501
10.2
190.1
2008
5,273
461
8.7
(124.6)
2009
5,450
537
9.9
(306.9)
2010
5,234
603
10.9
726.5
2011
5,231
557
10.6
(647.5)
2012
5,468
543
9.9
(402.2)
aFiscalyearendingJune30.
Table543:TheCloroxCompanysGlobalCorporateSalesby
Region,2011and2012
%Oftotal
Region
2011
2012
TheUnitedStates
78.9
78.9
International
21.1
21.1
100.0
100.0
Total
The Clorox Company is represented in the cosmetics and toiletries industry through its
brand,BurtsBees.
BurtsBeeswitnessesahealthygrowthof8.9%in2012.
The marketers product offerings include lip care, lip shimmer, and gloss products;
body care products such as moisturizers, soaps, and natural bath products; hair care
products including shampoos, conditioners, and treatments; natural personal care
products,suchascleansers,toners,eyecrme,exfoliants,complexionmists,footcare,
handsoaps,skincareproductsformen,andtoothpastes.
The Clorox Companys U.S. sales of cosmetics and toiletries grow 8.9% to $172million in
TheU.S.cosmeticsandtoiletriessalesofthecompanyhaveincreasedataCAGRof15.1%
767
568
TheCloroxCompany
Table544:TheCloroxCompanysCosmeticsandToiletries
Yearr
$Million
Change,%
2007
85
2008
111
30.6
2009
125
12.6
2010
141
12.8
2011
158
12.1
2012
172
8.9
rRestated.
BurtsBeeshasbeenaleadingmarketerinnaturalpersonalcareproductssince1984.
It manufactures more than 250 products in lip care, face care, body care, hair care,
mensskincare,babycare,oralcareproducts,kits,andgifts.
Theproductsprimarilysellinnearly42,000retailoutlets,includingsomeofthemajor
grocery and drug store chains in the United States, the United Kingdom, Ireland,
Canada,HongKong,andTaiwan.
The company increased its distribution channels through specialty natural retailers,
massretailers,anddepartmentstoresin2011,whichcontinuestoaidinincreasingthe
brandssalesin2012.
The Clorox Company remains the secondlargest company in the lip balms, jellies, and
treatmentsproductscategoryin2012.
Manufacturers sales increase 9.4% to $58 million in 2012 from $53 million in 2011.
Burts Bees products benefit as demand shifts from syntheticbased and petroleum
basedlipproductstoproductswhicharemorenatural.
Marketsharerisesto15.5%in2012from14.8%in2011.
The personal cleansing products category is the secondlargest product category for the
companyin2012.
Themarketerssalesinthecategorygrow5.7%from$35millionin2011to$37million
in2012.
Sales of personal cleansing products represent 21.5% of the marketers total sales in
the cosmetics and toiletries market. This is marginally down from 22.2% of the
marketerstotalsalesin2011.
Thecompanyspersonalcleansingproductscategorysportfolioincludesawiderange
ofbodywashes,barsoaps,showerkits,oils,crystals,scrubs,andbubblebathproducts.
4A68
TheCloroxCompany
The thirdlargest product category for the company in 2011 is the hand and body lotions
withsalesup3.4%toreach$30millionin2012,upfrom$29millionin2011.
In2012,thecompanyintroducesitsGdlineofproductscomprisingbodylotionsand
bodybutters.
In spite of the introduction of new products, the marketers share in the category
declinesfrom18.4%in2011to17.4%in2012.
In 2012, The Clorox Company updates its Burts Bees hand and body lotions bottles
withtheadditionofconvenientpumpsthathelpdispensetheproductwithease.
Facial treatment is the fourthlargest category for the company in 2012, with sales at
$29million.
Sales of the company in 2012 are up 7.4% from $27 million in 2011. The good
performance of the Burts Bees brand is due to the introduction of the Intense
Hydration line comprising the Cream Cleanser, the Day Cream, the Night Cream, the
TreatmentMask,andtheEyeCream.
The Clorox Company rises to become the secondleading marketer in the baby care
products category (tied with Naterra), with sales at $9 million in in 2012, up 12.5% from
$8millionin2011.
ThemarketshareforTheCloroxCompanyinthebabycareproductscategoryadvances
from2.8%in2011to3.1%in2012.
BurtsBeesintroducesitsnewlineofbabycareproductsknownasBabyBeein2012,
andhasanexclusivewebsiteforitsentirebabycarerangeofproductsandaccessories.
This step helps the brand gain more media coverage in 2012 thereby bringing about
moreawarenessfortheentirebrand.
ThepositioningofBurtsBeesproductsascontainingnaturalandorganicingredients,
with affordable pricing, together with an expanding distribution network also aids in
thecompanysgrowth.
SalesofTheCloroxCompanyinthehaircareproductclassgrow50.0%toreach$9millionin
Thehaircareproductclasscontributesto5.2%ofthecompanystotalcosmeticsand
toiletriessalesin2012,upfrom3.8%in2011.
Thegrowthofthecompanyinthehaircareproductclassisaresultofthesmallsales
baseofthecompanyineachoftheshampoosandconditionerscategory.
The marketer reformulates its hair care collection with new formulations for its
shampoos and conditioners, making it more naturallyenriched, free of sulfates, and
replacingsyntheticfragranceswithnaturalones.
Thenewshampoosandconditionerscontainmildercleaningagentsorsurfactants,and
addedaminoacidsandjojobaproteintofortifyandprovidelightmoisturizationtothe
hair.
In 2012, the marketer discontinues its Color Keeper Shampoo and Conditioner and
claimsitsnewlyformulatedshampoosandconditionerstobegentleoncoloredhair.
Additionally, this new hair collection is now available inrecyclable bottles (80% post
consumerrecycledcontent).
769
570
TheCloroxCompany
RECENTDEVELOPMENTS
In January 2012, Burt's Bees officially launchesa new natural brand, Gd, under different
categories, including shampoos, conditioners, body washes, body butter, body lotion, and
handwashes.
SalesofthenewbrandcommencedonlineinDecember2011.
ItisaimedatayoungerdemographicthanitsflagshipbrandBurtsBees.
Alsoin2012,BurtsBeesentersintoalicensingagreementwithAyablu,achildrensproduct
designcompany.
Currently, Burts Bees range of baby care products include body washes, bar soaps,
moisturizers, ointments and care, and sun care products. This move sees the brands
expansion into multiple categories including home and lifestyle. The line debuts with
newbornproductsthatincludeapparel,accessories,bathlinens,andgiftsets.
The company debuts this range of products through select Target stores and the
retailerswebsite,target.com.During2012,thecompanygraduallyexpandeditsrange
ofproductstobeavailableatbuybuybabyretailoutletsandBabiesRUs.com.BurtsBees
hasalsolaunchedaportaldedicatedtoitsnewlineofproductsatburtsbeesbaby.com.
Burts Beespartners with Preserve,a sustainable consumer goods company, to develop a

recyclable solution for its Burts Bees Lip Balm, Tinted Lip Balm, Lip Shimmer Tubes, and
BurtsBeesplasticcaps.
Thepartnershipisaimedatdivertingplasticfromlandfillsinordertoprovidematerial
todeveloppackagingfornewproducts,suchasPreservetoothbrushesandrazors.
Newproducts
Table545:SelectNewProductsIntroducedbytheCloroxCompanyintheUnitedStatesin2012
Brand
Category
Description
BurtsBees
Facialtreatments
IntenseHydrationisanewlinecomposedofCreamClenser,DayCream,NightCream,
TreatmentMask,andEyeCreamdevelopedtoprovideintensehydration.ClarySage,a
botanicalthatsurvivesinharshenvironmentsduetoitsabilitytoretainmoistureis
theinspirationbehindtheline
BurtsBees
Lipbalms,jellies,
andtreatments
BurtsBeesintroducesUltraMoisturizingLipTreatmentwithKokumButter,which
helpssootheandrestorelips.ThebrandaddsthreenewshadestoitsLipShimmer
collection:cherry,plum,andstrawberry
BurtsBees
Shampoos
BabyBeeshampoocontainsnaturalplantbasedcleansingcomplexincombination
withsweetorangeandlemonoilstocreateanourishingformulathatleavesthe
babyshairandskinsilkysoft
Gd
Personalcleansing
products
NaturalBodyWashcleansestheskinandisavailableinfivefragrances:RedRuby
Groovy,PearnormalActivity,OrangePetalaooza,FloralCherrynova,andVanillaFlame
Gd
Handandbody
lotions
NaturalBodyLotionhydratestheskinandgetsabsorbedquickly,hasnoparabens,
phthalates,orpetrochemicals.Itisavailableinfivefragrances:RedRubyGroovy,
PearnormalActivity,OrangePetalaooza,FloralCherrynova,andVanillaFlame
Gd
Handandbody
lotions
NaturalBodyButtermoisturizesandsoftenstheskin.Itisavailablethesame
fragrancesastheNaturalBodyLotionandNaturalBodyWash,excepttheRedRuby
Groovy
4A70
TheCloroxCompany
MARKETINGACTIVITY
TheCloroxCompanystraceablemediaexpenditure(TME)advancesto$9.5millionin2012,
up58.3%from$6.0millionin2011.
Magazineadvertisingisthemostpreferredmarketingmediaadoptedbythecompany.
Thecompanyspends$7.9millionin2012,up36.2%from$5.8millionin2011.
BurtsBeesreceivesaTMEallocationof$9million,whileGdreceivesaTMEallocation
of$500,000in2012.
The Clorox Company heavily depends on social media networks, such as Facebook and
Twitter(@gudhappens),topromoteitsproductsinthecosmeticsandtoiletriesmarket.
Burts Bees promotes its Gd line of products with 90 seconds of scratchandsniff
animatedvideoonitsFacebookpage.
The company distributes approximately 2.6 million scratchandsniff cards to
consumersthatdirectthemtothevideoonFacebook.
BurtsBeesFacebookfanbasetouches1millionin2012,upsignificantlyfrom560,000
in2011.
Themarketerstrategicallyblendsnewmediawithestablishedtraditionalmarketingmedia
suchasprintandtelevisionadvertising.
To promote its Intense Hydration line of products, Burts Bees uses an interactive
billboardonabusystreetinMinneapolisthatshowsawomansfacewithdryskinthat
is made up of thousands of product coupons. The dry skin flakes or the coupons are
peeledbypassersbytorevealhydratedskinonthemodelsfaceonthebillboard.
BurtsBeesenjoysthereputationofbeingrecognizedasasustainablecompany.
Thecompanysreputationofbeingasustainablecompanynotonlycomesfromitsuse
of natural ingredients in its products but also its waste reduction strategies and
employeeeducationprogram.
Burts Bees campaign in 2012, Wild For Bees, expresses its concern over the Colony
Collapse Disorder (CCD) or the disappearance of bees. The campaign educates
consumers on the importance of bees for pollination by introducing a series of
educationalvideosabouttherolesofdifferentbees.Thecampaignendswiththebrand
askingtheconsumerstogetinvolvedinthecampaignandhelpsavethebees.
The Clorox Company has successfully allowed Burts Bees continue to operate as an
independentsubsidiaryandmaintainsitsprincipleofsustainabilythattheBurtsBees
foundersinstilled.
771
572
TheCloroxCompany
Thecompanypromotesitsproductsthroughcashcouponsandgiveaways.
TopromoteitsnewIntenseHydrationrangeofproducts,themarketeroffersa$3.00
discountonanyofthefiveproductsintherange.
In 2012, the brand urges its consumers to visit diaper.com to enter a giveaway that
gives three winners a chance to win $100.00 worth of Burts Bees assorted products
includingthoseforMomandBaby.
Alsoin2012,thecompanyinitiatesBurtsBeeslipbalmnaturalchampioncontest,in
whichpeopleenterthecontestbypostingaphotoofthemwiththebrandslipbalm.
Thewinnerreceivesathreedaytripincludingairfare,hotel,andgroundtransportation
to Burts Bees Headquarters in Durham, private concert tickets, four $150.00 spa
vouchers,and$500.00ofBurtsBeesproducts.
ThecompanyusesamarketingstrategydifferentfromtheBurtsBeesbrandtointroduce
itsGdlineofproducts.
The company adopts the scratchandsniff strategy wherein consumers can use the
scentcardtosmelltheproductsfragrances.Thesescentcardsaredistributedthrough
magazinessuchasAllureandLucky.
Additionally, the marketer takes the help of guerrilla street teams to give out
handoutsatsixuniversities.
The company gives a fun image to its Gd brand with youthfriendly names such as
OrangePetalooza,FloralCherryNova,andVanillaFlame.
TheGdbrandisadvertisedwiththetagline:Wherevergdgoes,gdhappens.
OUTLOOK
TheCloroxCompanyisforecasttogrowataCAGRof4.0%duringtheforecastperiod,2012
to2017.
Thecompanywillcontinuetointroducenewandinnovativeproductsoverthenextfive
years.
Burts Bees will continue to enjoy its natural positioning in the market place and
maintain its core values that it had before its acquisition by The Clorox Company.
However, the acquisition benefits the brand with a large advertising expenditure
allocationandawidedistributionnetwork.
ThelaunchoftheGdbrandislikelytoexpandthecompanystargetdemographyand
increasethesalesofthecompanyspersonalcaresegmentintheforecastperiod.
BurtsBeeslineofhaircareandbabycareproductsareexpectedtobethestarperformers
TherepositioningoftheBurtsBeeshaircarelineofproductswithconsumerfriendly
formulas and a new packaging in 2012 helps spur sales of the stagnating line of
products.
Thehaircarelineofproductsisexpectedtogatherfurthersalesintheforecastperiod.
Furthermore,theBurtsBeeslineofbabyproductsareexpectedtogathermomentum
duringtheforecastperiodafterthebrandentersalicensingagreementwithAyablu.
4A72
TheCloroxCompany
In the lip balms, jellies, and treatments category, Burts Bees will continue to induce
consumerinterestinthecategoryduetoitsnaturalpositioning.
Thecompanywillcontinuetoinnovateinthecategorybyintroducinglipproductsthat
provide lip plumping, antioxidant, and sun protection benefits apart from solely
moisturizingthelips.
Thecompanywillcontinuetobuilduponthesuccessofitslineoftintedlipbalmswith
theintroductionofnewshades.
Innovationinpackagingdesignsisalsolikelytohaveapositiveimpactonthebrands
salesduetoitsfreshpositioninginthemarket.
Inthepersonalcleansingproductscategory,thecompanyisexpectedtogrowataCAGRof
2.6%throughtheforecastperiodending2017.
ThecompanywilldependonitsgrowingBurtsBeesanditsnewlylaunchedGdbrand
forsuccessinthecategory.
Burts Bees naturally formulated body washes, bar soaps, and bath salts will drive
growthforthebrand.
Ontheotherhand,Gdsfreshlyfragrancedlineofproductswilldrivegrowthforthe
brandwiththeadditionofvariantsandthepossibilityofventuringintobarsoapsand
otherpersonalcleansingsegmentsduringthecourseofthenextfiveyears.
Inanattempttocompetewithothermassmarketers,thecompanyisexpectedtointroduce
multibeneficialskincareproductsunderitsBurtsBeesbrandwhichwillprovidebenefits
additionaltobasicmoisturizationandnourishing,suchasprovidingantiagingbenefits,
acneprevention,suncarebenefits,andanevenskintone.
The ongoing preference among consumers for the increased use of natural products will
likely attract more consumers towards the Burts Bees brand and increase sales for the
companyduringtheforecastperiod.
The company is progressively increasing its advertising expenditures and is likely to

continuethetrendthroughtheforecastperiod.
TheCloroxCompanyhasrecentlyenteredintothetraditionalmediaofadvertisingsuch
as television and print advertisements for its Burts Bees brand and will continue to
emphasizeitseffortsonthemediumduringtheforecastperiod.
Social media will remain an important and integral part of the companys marketing
strategytopromoteitspersonalcarebrands.ThecompanysFacebookpageallowsit
tointeractwithitsconsumersandbuildamorepersonalrelationship.
Thecompanyisalsolikelytoexpanditsfocusondigitalmarketinginthefuture.
773
574
TheCloroxCompany
The Clorox Company will continue its partnerships and affiliations with organizations to
achievesustainability.
Cloroxincreasesitsleveloftransparencybymovingtowardsintegratedreportingand
expanding its Ingredients Inside Program which discloses the list of ingredients
containedinitscleaninganddisinfectantproductsintheUnitedStatesandCanada.
These initiatives are important for Burts Bees to maintain its image as a naturally
positionedbrand.
ThecompanyscosmeticsandtoiletriessalesareprojectedtogrowataCAGRof4.0%from
Table:546:ForecastDollarSalesofCosmeticsandToiletriesfortheClorox
CompanybyCategory,2012to2017
Category
CAGR,%
Shampoos
9.9
Babycareproducts
9.2
Conditioners
8.4
Facialtreatments
5.0
COMPANYAVERAGE
4.0
3.2
2.6
Handandbodylotions
2.5
4A74
COLGATEPALMOLIVE
Table547:ColgatePalmolivesSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
2012
569
605
46
48
622
659
Softsoapliquidsoaps
209
215
IrishSpringbarsoaps
106
110
Softsoapbodywashes
87
89
IrishSpringbodywashesr
35
33
Palmolivebarsoapsr
12
TomsofMaine
448
464
139
152
27
28
166
180
SpeedStick
97
96
LadySpeedStick
53
51
TomsofMaine
21
22
174
172
12
12
TOOTHPASTES
Colgate
TomsofMaine
Ultrabrite
Total
Totalr
TOOTHBRUSHES
Colgate
Colgate(batteryoperated)
Total
TeenSpirit
Total
MOUTHWASHES
TomsofMaine
Viadent
(Continued)
REPRODUCTION OR DISCLOSURE FORBIDDEN; SEE SPECIAL NOTICE KLINE & COMPANY, INC.
576
ColgatePalmolive
Table547:ColgatePalmolivesSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
Category/brand
MOUTHWASHES(Continued)
Fluorigard
Total
FRAGRANCESFORMEN
SkinBracer
Afta
Total
TOTALr
rRestated.
$Million
2011
2012
15
12
4
2
6
1,431
4
2
6
1,493
COMPANYOVERVIEW
ColgatePalmoliveCompany,foundedin1806,togetherwithitssubsidiariesmanufacturesand
marketsconsumerproductsworldwide.
Its product range consists of oral care products, including toothpaste, toothbrushes, and
mouthrinses,aswellaspersonalcleansing,deodorant,andpharmaceuticalproducts.
Thecompanyalsomanufacturesandmarketspetnutritionproductsunderthebrandname
Hills.
AsofDecember31,2012,thecompanyemploysabout37,700peopleworldwideanddoes
businessinmorethan200countries.
ThecompanyhasitsheadquartersandcorporateofficeatParkAvenue,NewYorkCity,NY.The
three manufacturing facilities in the domestic market are located in Morristown, NJ;
Morristown,TN;andCambridge,OH.
Internationally, the company operates approximately 280 properties, of which 76 are
companyowned, in more than 70 countries. Major overseas facilities are located in
Australia,Brazil,China,Colombia,France,Italy,Mexico,Poland,SouthAfrica,Thailand,and
Venezuela.
The companys business is managed in two product segments: Oral, Personal, and Household
care;andPetNutrition.
The Oral, Personal, and Household care segment offers products such as toothpastes,
toothbrushes,oralrinses,dentalfloss,andpharmaceuticalproductsfordentistsandother
oralhealthprofessionals.Thesegmentalsomarketspersonalcareproductssuchasshower
gels, shampoos, conditioners, bar soaps, deodorants and antiperspirants, and liquid hand
soaps. The household cleaning products include dish washing liquids, household cleaners,
oilsoaps,andfabricconditioners.
ThePetNutritionsegmentproducesproductsfordogsandcats.
In2012,thecompanyinvestsatotalof$259millioninresearchanddevelopment,down1.1%
4A-76
ColgatePalmolive
ColgatePalmolives total sales are up by 2.1% from $16,734million in 2011 to

Thecompanysnetprofitsgrow1.7%,from$2,431millionto$2,472millionin2012.
Since2007,thecompanyssaleshaveincreasedatacompoundannualgrowthrate(CAGR)
of4.4%,whilenetprofitshavegrownataCAGRof7.3%.
Table548:ColgatePalmolivesGlobalCorporateSales,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Sales
Netprofits
13,789.7
1,737.4
15,329.9
1,957.2
15,327.0
2,291.0
15,564.0
2,203.0
16,734.0
2,431.0
17,085.0
2,472.0
%
Marginonsales
12.6
12.8
14.9
14.2
14.5
14.5
Returnonequity
76.0
101.8
70.3
77.8
95.6
103.4
Table549:ColgatePalmolivesGlobalSalesbyBusinessSegment,2011
and2012
Segment
Oral,personal,andhouseholdcare
Petnutrition
Total
%Ofsales
2011
2012
87.0
87.4
13.0
12.6
100.0
100.0
Oralcarecontinuestobethelargestproductclassforthecompany,with44%shareduring
2012,upfrom43%in2011.
Table550:ColgatePalmolivesGlobalCorporateSales
byProductClass,2011and2012
Productclass
Oralcare
Homecare
Personalcare
Petnutrition
Total
%Oftotal
2011
43
22
22
13
100
2012
44
21
22
13
100
577
578
ColgatePalmolive
In 2012, the U.S. sales of ColgatePalmolives cosmetics and toiletries grow from
$1,431millionin2011to$1,493million,upby4.3%.
Since2007,saleshaveincreasedataCAGRof1.6%.
Table551:ManufacturersSalesforColgatePalmolive,
2007to2012
Year
$Million
Change,%
2007
1,382
2008
1,446
4.6
2009
1,448
0.1
2010
1,420
(1.9)
2011
1,431
0.8
2012
1,493
4.3
ToothpastesremainsColgatePalmoliveslargestcategoryintheoralcareproductsclass.
In 2012, ColgatePalmolive overtakes Procter& Gamble for the leadership position in
the toothpastes category with 37.7% share, based on the strong performance of the
ColgateOpticWhitebrand.
ColgatePalmolivecontinuestoexperiencestrongsalesgains.
In 2012, ColgatePalmolives sales increase by 5.9%, up from $622million in 2011 to
$659millionin2012.
ThestronggrowthofthemarketerisprimarilysupportedbythesuccessoftheColgate
OpticWhitebrandin2012.
Newproductintroductions,suchasColgateOpticEnamelWhitewithformulationsfor
whiteningandsensitiveteeth,boostthecompanysperformancein2012.
Colgateistheleadingbrandforthecompanyinthecategory,withsalesof$605million
in2012,up6.3%from$569millionin2011.
The company offers three brands in the category: Colgate, Toms of Maine, and
Ultrabrite.
The whitening toothpaste trend helps the brand grow its sales in 2012 and helps
strengthenColgatePalmolivespositioninthetoothpastescategory.
Toms of Maine, the brand the company purchased in 2006, experiences continued
growthduring2012,attributedtothenaturalbasedactiveingredientsinitstoothpastes.
SalesofUltrabritedeclinesto$6millionin2012from$7millionin2011.
Limited new product activity and promotional support contributes to the decline of
Ultrabritebrandinthetoothpastescategoryin2012.
4A-78
ColgatePalmolive
PersonalcleansingproductsisColgatePalmolivessecondlargestcategorywithasalestotal
of$464millionin2012,up3.6%from$448millionin2011.
Thecompanydominates11.5%oftotalcategorysalesin2012,downfrom12.0%oftotal
categorysalesin2011.Itisthesecondleadingmarketerinthecategory.
Themarketercompetesintheliquidsoaps,barsoaps,andbodywashessegments.
The marketer is represented in the category with its Softsoap, Irish Spring, Palmolive,
andTomsofMainebrands.
ColgatePalmoliveistheleadingmarketerintheliquidsoapssegmentandfourthlargest
marketerinthebodywashesandbarsoapssegmentsduring2012.
cleansingproductscategoryin2012.Salesofthemarketerinthesegmentincrease2.9%
Salesofthemarketerinthebodywashessegmentremainstableat$122millionin2012,
flatfrom2011levels.
Deodorants and antiperspirants sales decline by 1.1% in 2012 to $172million from

$174millionin2011.
ThecategoryisthefourthlargestforColgatePalmolive.Thecompanyaccountsfor8.4%
of the total deodorant category sales in 2012, down from 8.7% of the total category
salesin2011.
ColgatePalmoliveisrepresentedinthecategorybySpeedStick,LadySpeedStick,Toms
ofMaine,andTeenSpiritbrands.
The sales of Speed Stick, the flagship brand of the marketer, decline 1.0% from
The Speed Stick brands sales decline in spite of the launch of the new product line
SpeedStickPowerin2012.Theproductlinecontainsfourvariantsinthesolidformand
two variants in the gel form. To launch the product line, the marketer initiates the
Handle It campaign on Twitter, inviting consumers to share their uncomfortable,
funny, and embarrassing moments transformed into a YouTube video, with television
actor Danny Pudi as the narrator. Also, Danny Pudi provides consumers with some
adviceonafewofthecommonlyincurredHandleItmoments.
Thebrandfurtherlosesoutonsalesduetoalowtraceablemediaexpenditure(TME)of
$4.1millionin2012.MajorityofthebrandsTMEat$4.0millionisallocatedtowardsthe
advertisementofthenewlylaunchedSpeedStickPowerproductline.
Lady Speed Stick is the secondlargest brand for the marketer with sales down 3.8%
from$53millionin2011to$51millionin2012.Salesforthebranddeclineduetothe
absenceofnewproductactivity,negligibleTME,andincreasingcompetitionfromother
femaleorienteddeodorantsandantiperspirants.
579
580
ColgatePalmolive
In2012,LadySpeedStickistheofficialsponsoroftheWomensHalfMarathonheldat
St.Petersburg,FL.Theeventencourageshealthandfitnessamongwomen,withmany
participantsjoiningeveryyear.
Toms of Maine, the thirdleading brand for ColgatePalmolive registers a growth of
4.8%toreach$22millionin2012,upfrom$21millionin2011.Thebrandaccountsfor
1.1%ofthetotalcategoryssalesin2012,stagnantfrom2011.
TomsofMainesgrowthin2012isattributedtothebrandspositioninginthemarket
asaproducerofaluminumfreedeodorants,sincealuminumhasbeenlinkedtobreast
cancer,albeitinconclusively.Additionally,thebrandsexpansionintomainstreamretail
outletsaddstoitssalesin2012.However,furthergrowthofthebrandisoffsetbythe
premiumpricingofthebrandsdeodorantsandantiperspirants.
In 2012, the company introduces the Toms Of Maine Mens Long Lasting Wide Stick
DeodorantinCleanConfidenceandMountainSpringvariants,andtheTomsofMaine
NaturallyDryAntiperspirantStickintheNaturalPowderandUnscented/Fragrancefree
variants.
In2012,thebrandpartnerswithTerraCycle,anorganizationthatworkswithcompanies
towards eliminating waste, to launch the Toms of Maine Natural Care Brigade. This
programencouragesconsumerstokeeppackagingfromTomsofMaineproductsoutof
landfills.Asacontinuationofits50StatesforGoodprogram,thebrandannouncesyet
another $150,000 as a part of the project funding. The winning projects, which have
been voted for by the public, include initiatives around reforestation, environmental
danceprograms,freedentalcare,andafriendshipnetwork.
ToothbrushesisthefourthlargestcategoryforColgatePalmolive.
Thecompanyssalesincrease8.4%to$180millionin2012from$166millionin2011.
ColgatePalmolivesmarketsharealsoincreasesfrom22.9%in2011to24.3%in2012.
Growth is seen primarily in manual toothbrushes which gain slightly in market share,
from19.2%in2011to20.5%in2012.
Themarketerlaunchestoothbrusheswithmultibenefitssuchasplaqueremoval,breath
freshening, and gum massage that support its growth in the manual toothbrushes
segment.
Salesofitsbatteryoperatedtoothbrushesalsogrowby3.7%,from$27millionin2011
to$28millionin2012.
The success of ColgatePalmolives Optic White range of oral care products, which
includestoothbrushes,contributesdirectlytothecompanysgrowth.
RECENTDEVELOPMENTS
Managementchanges
TherearenonotablechangesinColgatePalmolivesmanagementin2012.
4A-80
ColgatePalmolive
Otherdevelopments
InAugust2012,Procter&Gamble filesacomplaintagainstColgatePalmolivetotheNAD
(NationalAdvertisingDivision)intheUnitedStatesregardingtheusageofcertainclaimsfor
itsOpticWhiterangeoforalcareproducts.
The NAD has ordered ColgatePalmolive to stop advertising some claims for its whitening
toothpastesincludingSamewhiteningingredientasstrips.
In September 2012, ColgatePalmolive announces that its agency partners Y&R, MEC,
VML,WundermanandGHGarejoiningforcestocreateasingleoperatingunittoengage
withconsumersinrealtimeacrossalltouchpointsandtodriveefficiencies.
In October 2012, ColgatePalmolive and Omron Healthcare enter a broad cooperation

agreementtomarketanddeveloporalcareproductsincludingelectrictoothbrushes.
Newproducts
Table552:SelectNewProductsIntroducedbyColgatePalmoliveintheUnitedStatesin2012
Brand
Category
Description
Colgate
Toothpastes
ColgateMaxFreshCoolCrystalsMinttoothpasteisafluoride
toothpastethathelpstofreshenbreath,fightcavity,andwhiten
teeth
Colgate
Toothpastes
ColgateOpticEnamelWhitetoothpastecontainsthesamewhitening
ingredientaswhiteningstripsforwhiterteethinoneweekand
fortifiesenamelforstrongwhiteteeth
Colgate
Toothpastes
ColgateMaxFreshNightToothpastecontainszincwhichhelps
preventgermbuildupatnight
Colgate
Toothbrushes
ColgateMaxFreshtoothbrush,withitsmultiheight,multiangle
bristlespenetratedeeplybetweentheteethtoblastawayplaque
Colgate
Toothpastes
ColgateMaxwithMouthwashBeadsTinglingMinttoothpastehas
dissolvableminimouthwashbeadsthatcleansthemouth,helpsfight
germs,andpreventscavities
Colgate
Toothpastes
ColgateMaxWhiteLiquidToothpasteprotectsagainstcavities.The
toothpastehassodiumfluorideastheactiveingredient
Colgate
Toothbrushes
ColgateMaxWhitetoothbrushgentlyremovesstainswithitsunique
polishingstarandspeciallydesignedbristles
Colgate360
Toothbrushes
Colgate360WholeMouthCleantoothbrush,withmorebacteria
removingnubs,removesover96%morebacteria
(Continued)
581
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ColgatePalmolive
Table552:SelectNewProductsIntroducedbyColgatePalmoliveintheUnitedStatesin2012
Brand
Category
Description
Colgate360Optic
White
Toothbrushes
Colgate360OpticWhitePowertoothbrushpolishesawaysurface
stainsandcleanshardtoreachplaces
ColgateOpticWhite
Toothbrushes
ColgateWispOpticWhitetoothbrushcontainsbothwhiteningcups
andpolishingbristles
Toothpastes
BotanicallyBrightwhiteningtoothpasteissodiumlaurylsulfatefree
andfluoridefreetoothpastewhichisformulatedwithablendof
botanicalsthathelptowhitenteethnaturally.Itisavailableintwo
flavors:Spearmintwithaloeandchamomile,andpeppermintwith
xylitolandpropolis
TomsofMaine
MARKETINGACTIVITY
ColgatePalmolive primarily promotes its products through TPRs (temporary price

reductions),displaysinstore,andbroadcastadvertising.
Themarketersupportsitsproductswithdiscountcoupons.
ColgatePalmolive offers discount coupons ranging between $1.00 and $3.00 on its
websiteandmagazines.
ColgatePalmolivehasTMEsof$110.4millionin2012,up35.1%from$81.7millionin2012.
Approximately$104.3millionor94.5%ofthetotalTMEisallocatedtothetoothpastes
categoryin2012.
Colgates whitening toothpastes receive onehalf of TME in 2012, with a total of
$55.8millionspent.
Broadcast media is ColgatePalmolives preferred medium of advertising to promote its

products.
ColgatePalmoliveusesprintadvertisementsextensively.
Print advertisements for mouthwashes increasingly differentiate products based upon
theabilitytodeliveraddedbenefits.
ColgatePalmolivesbrandTomsofMaineadvertisesitsmouthwasheswiththetagline
stopsbadbreathwithouttheburn.
ColgatePalmolive is the largest advertiser in the toothpastes category, with total TME of
morethan$104.3millionin2012.
ColgatePalmoliveswhiteningbrandsreceiveonehalfofTMEsin2012,withatotalof
$56.6millionspent.
ThemarketerspendsaboutonethirdofitsTMEtosupportitsOpticWhitebrand.
ColgatePalmolivedemonstratesmethodstocombinedigitalandoutdooradvertisingto
maximize impact with its Smile campaign. ColgatePalmolive uses a dedicated
Facebookpagewhereusersareencouragedtouploadpicturesofthemsmiling.These
arethenturnedintolargecollageposterswhichcanbeseeninsupermarkets,shopping
malls,andotherpointofsalelocations.
4A-82
ColgatePalmolive
ColgatePalmolivealsoprovidesvariousapplicationsthatcanbedownloadedonmobile
phones, including Colgate Smile Capsule, Colgate Smile Sign, and MaxWhite iPhone
Application.
Colgate Optic White toothpaste and toothbrushes are supported by an integrated
marketingcampaign,includingbothdirectinstoreandoutofstoresupport.
ColgatePalmolivepromotesitsproductsthroughvariouscelebritycampaigns.
InFebruary2013,talkshowhostKellyRipasignsonasColgateTotalsspokespersonfor
itsYouCanDoItCampaign.Asapartofthecampaign,KellyRipafeaturesinvarious
television advertisements encouraging consumers to discover the importance of oral
hygieneandhealthymouth.
ColgatePalmolive partners with Jeannie Mai, fashion expert, actress, and television
personality,topromoteitsOpticWhitebrandwiththetaglineGettheperfectsmile.
InNovember2012,ColgatePalmoliveteamsupwiththepopmusicbandOneDirection
tolaunchtheneworalcareline.Aspartofthecompanysrecentcollaboration,Colgate
Palmolive features the band on its products in the United States, to encourage young
peopletotakecareoftheirteeth.
Thecompanyutilizesonlinepromotionsasanimportanttool.
Inthedeodorantsandantiperspirantscategory,ColgatePalmoliveusestheInternetto
launchitsnewproductsasmostofthemareaimedatyoungcustomers.
The companys website offers the SmileTalk enewsletter for consumers, and also a
varietyofbothfunandeducationalfeaturessuchasSmileSign,whichallowsconsumers
tolearnwhattheirsmilesaysaboutthem.
The company also offers discount coupons to its SmileTalk members. The company
offers discount coupons ranging between $0.75 and $2.00 off on its products to its
SmileTalkmembers.
Consumers can sign up for newsletters on the Toms of Maine website in order to get
updatesonnewproductlaunchesandotherpromotionaloffers.
OUTLOOK
ColgatePalmoliveisforecasttogrowatamoderatepaceof1.5%overthenextfiveyears
2012to2017.
Toothpastesandtoothbrushescategoriesareexpectedtoshowpromisinggrowthover
theforecastperiodsupportedbyproductinnovations.
ColgatePalmolive is expected to generate moderate growth over the next five years,
mainlysupportedbythemarketersleadershipbrandsinthepersonalcaremarket.
The company will continue to gain sales through new product launches and product
innovationsduringtheforecastperiod.
583
584
ColgatePalmolive
Toothpastes are expected to be the largest revenue generator for the company over the
forecastperiod.
Themarketerisexpectedtomaintainitsleadershippositioninthetoothpastescategory,
supportedbynewproductlauncheswithmultiplebenefitsandenhancedefficiency.
ColgatePalmolive is expected to launch products for specific oral care problems
includingsensitiveteeth,protectionagainstplaque,anddrymouth.
The marketer will also benefit from its global brand names and its international
presence,whichwillhelpincreaseitsprofitabilityandshareholdervalue.
ColgatePalmolivewillcontinuetolaunchstarbrandssuchasOpticWhitetosupportits
leadershippositioninthecategoryandtoincreaseitsmarketshare.
Thepersonalcleansingproductscategoryisexpectedtopostmoderategrowthof1.5%over
theforecastperiod.
ColgatePalmoliveisexpectedtolaunchnewproductsacrossvarioussegmentsincluding
bodywashes,barsoaps,andliquidsoapstosupportitssalesinthecategory.
Themarketerwilllikelylooktoinnovatewithitsproductsbyofferingadditionalbenefits
inadditiontotheregularcleansing.Addedbenefitstothepersonalcleansingproducts
could be in the form of moisturizing, exfoliating, antiaging, odor protection, and
additionofvitamins.
ColgatePalmolivewillcontinuetomakeeffortstodifferentiateitsproductsfromothers
availableinthemarketsoastoprovideexclusivity.
Thetoothbrushescategoryisexpectedtoperformwellovertheforecastperiod.
ColgatePalmoliveisexpectedtointroduceproductswithbettertechnologyandlower
pricestosupportitssalesinthecategory.
Themarketerwillcontinuetolaunchnewandcreativeproductswithmultiplebenefits,
such as plaque removal, breath freshening, or gum massage to keep pace with the
growthinconsumerdemandandexpectations.
ColgatePalmolivewillalsooffertoothbrushesthataredesignedforspecificproblems,
includinggummassage,plaqueremoval,anddeepcleaning.
Theintroductionofcomparablypricedbatteryoperatedtoothbrushesbyprivatelabelis
expected to wane down the sales prospect of ColgatePalmolives batteryoperated
toothbrushesandwilloffsetitsgrowthprospect.
ColgatePalmolive will continue to invest in advertising and special promotions, thereby

remindingconsumersoftheimportanceofmaintaininggoodoralhealth.
The marketer is expected to increase its marketing activity to support its overall sales
ColgatePalmoliveisexpectedtoofferdiscountcouponstoattractconsumersandsafe
guarditsmarketshare.
Thecompanywillcontinuetoutilizeinnovativetools,suchassocialwebsitesandother
toolsoftheInternet,tocommunicatewithconsumersmoreeffectivelyandefficiently.
The marketer is likely to indulge in deploying marketing campaigns to keep the
consumersengagedandpromoteitsproducts.
ColgatePalmolive is likely to support its new product introductions with high TME to
ensurevisibilityofitsproductsinthemarket.
4A-84
ColgatePalmolive
In order to differentiate its products from the others available in the market, the
marketer isexpected to launch creative and innovative marketing strategies to gather
consumersattentiontherebyhelpingthecompanysgrowth.
Brand loyalty for the companys leading brands is expected to improve and further
augmentthemarketerspositioninthecosmeticsandtoiletriesindustry.
The company will focus on increasing its instore promotional activities to support its
salesinthecategoryovertheforecastperiod.
ColgatePalmoliveisexpectedtoincreaseitsspendingoninnovationandresearcheffortsto
introduceinnovativeproductsacrossitsproductcategories.
Innovations in terms of product portfolio, packaging, design, consumer feedback, and
instore activities, which build consumer awareness, will help the company achieve
highersales.
Themarketerwillalsostriveforinnovationtoreduceproductivitycosts,driveefficient
performancelevels,andthisislikelytobeakeytothecompanysoverallsalesgrowth.
ColgatePalmolive is expected to introduce innovative products with the help of the
latest scientific advances, consumer insights, and clinical trials, and will bring
improvementwhereverpossibleacrosstheorganization.
ThenewinnovationswillalsohelptodifferentiateColgatePalmolivesbrandsfromthe
competition.
ColgatePalmolivewillcontinuetofocusonnaturallypositionedproducts.
ColgatePalmolivesTomsofMainebrandisforecasttoexperiencesalesgrowthin2012
asthebrandgainsbyitsnaturalpositioning.
This brand shows progress from 2011 and may continue to support the companys
overallgrowth.
SalesinsmallermarketsforColgatePalmolive,suchasmensfragrancesandmouthwashes,
willcontinuetostagnateduetolackofpromotionalsupport.
SalesforColgatePalmoliveforthenextfiveyearsareforecasttoincreaseataCAGRof1.5%
andreach$1,608millionby2017,upfrom$1,493millionin2012.
ToiletriesforColgatePalmolivebyCategory,2012to2017
Category
CAGR,%
Toothbrushes
2.2
Toothpastes
2.0
COMPANYAVERAGE
1.5
1.5
Mouthwashes
0.5
0.3
Fragrancesformen
0.2
585
586
ColgatePalmolive
4A-86
COMBE
Table554:CombesSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
2012
110
115
118
122
20
20
154
157
JustforMen
GrecianFormula
Total
DENTUREPRODUCTS
SeaBond
SHAVINGPRODUCTS
LectricShave
Brylcreem
FRAGRANCESFORMEN
AquaVelva
TOTAL
COMPANYOVERVIEW
Combe Inc. is a manufacturer and marketer of OTC pharmaceuticals and personal care
products,particularlymensgroomingproducts.
The familyowned company was founded in 1949 by Ivan D. Combe and is
headquarteredinWhitePlains,NY.
IvanD.CombecreatedClearasilacnemedicationin1951andsoldittoVickChemicalin
1960.
The companys product portfolio includes antiitch, oral care, feminine hygiene, and
mensgroomingproducts.
JustforMenHairColorwasintroducedin1987andisthefirstinstantfullcoveragehair
colorformen.
Itsproductsaresoldin83countries,acrosssixcontinents.
ThecompanymaintainsitsmanufacturingfacilitiesinIllinoisandPuertoRico.
588
Combe
Thecompanysbrandportfoliofeatures:
MenshaircolorbrandsincludingJustforMen,GrecianFormula,andGrecian5.
OtherproductsincludehairstylingbrandBrylcreem.
TheaftershavebrandAquaVelvaandshavingproductLectricShavearealsomarketed
bythecompany.
SeaBonddentureadhesivesaremarketedinthedenturecarecategory.
Vagisilisthemainbrandofthefemininecarebusiness.
TheBrylcreembrandismarketedbyCombeintheUnitedStates.
In2011,UnilevercompletedthebuyoutofthebrandfromSaraLee,whomarketsthe
brandoverseas.
Combesolditscough/cold,skincare,andfootcarebusinessesin2011.
Under the Foot Care business of Combe, the OdorEaters brand is divested to Blistex
Inc.
The Cough/Cold and Skin Care businesses, consisting of Cepacol, Lanacane, Scalpicin,
LiceMD,andHemoalbrands,aresoldtoReckittBenckiserInc.
ThereasonforthesedivestituresisforCombetoincreaseitsfocusonitsglobalbrands.
Combeisaprivatelyheldcompanyanddoesnotreleasedetailedfinancialdata.
Therefore,onlyestimatesofsalesandprofitsareprovidedforthecompany.
Thecompanyssalesareestimatedat$220millionasof2012,withthebrandJustforMen
accountingforabout52.3%ofcompanystotalsales.
ThecompanyscosmeticsandtoiletriessalesintheUnitedStatesin2012postagrowthof
1.9%toreach$157millionin2012,upfrom$154millionin2011.
4A88
Combe
589
Table555:CombesCosmeticsandToiletriesSalesinthe
Year
2007
2008
2009
2010
2011
2012
$Million
140
146
146
143
154
157
Change,%
4.3
(2.1)
7.7
1.9
Hair coloring products is the largest category for Combe, contributing 77.7% of the
companystotalcosmeticsandtoiletriessalesin2012.
Themarketerpostsagrowthof3.4%from$118millionin2011to$122millionin2012.
Combeistheleadingmenshaircoloringmarketer,offeringproductlinesunderitsJust
forMenandGrecianbrands.
TheintroductionofJustforMenAutostoplinesupportsthegrowthofthemarketerin
2012, with the marketer allocating approximately $22.1million in traceable media
expenditure(TME)forthebrand.
TheJustforMenbrandhassolidbrandequityandiswellpositionedinthemarketplace.
TheJustforMenbrandcomprisesJustforMenHaircolor,Mustache&BeardJustfor
Men,JustforMenAutostop,andJustforMenTouchofGray.
GrecianFormulaisagradualhaircolortreatmentforgrayhairthatrequiresapplication
everydayforthefirsttwoweekstogiveresultsinthreeweeks.Theproductisavailable
inthreeeasytouseforms:GrecianLiquid,GrecianCream,andGrecianPlus.
Combeoccupiesamarketshareof9.3%inthehaircoloringcategoryin2012,upfrom
8.9%in2011.
The denture products category is the secondlargest category for Combe, accounting for
12.7%shareofthemarketerssales.
The sales of the marketer in the category are flat at $20million in 2012, same as its
2011levels.
Combeisthefourthleadingmarketerinthedentureproductscategory,accountingfor
6.3%oftheoverallcategoryssalesin2012.
SeaBond is the thirdleading brand in the denture adhesives segment, representing
10.0%ofthesegmentsales.
Combes hair styling products and sprays category contributes to 3.2% of the total
cosmeticsandtoiletriessalesofthecompanyintheUnitedStatesin2012.
Thesalesofthecompanydrop16.7%from$6millionin2011to$5millionin2012.
Brylcreem has been showing a consistent drop in sales for the past four consecutive
years.
Despitebeinganestablishedbrandofmenshairstylingproducts,thebrandislosing
market share to younger brands that are adopting new and innovative products,
attractivepackaging,andmoreaggressivemarketingstrategies.
590
Combe
Combesshavingproductsaccountfor3.8%ofthetotalsalesin2012.
SalesofLectricShave,themarketerssoleentrantinthecategory,remainstagnantat
$6millionin2012.
The marketers sales in the fragrances for men category remain constant at $4million in
2012,sameasits2011levels.
ThemarketersonlybrandinthemarketisAquaVelva.
ThemarketerprimarilyfocusesonitshaircoloringcategoryintheUnitedStates,whereit
hasacompetitiveadvantage,withanichecarvedoutinmenshaircoloring.
Combeaccountsformorethan85.0%ofthemenshaircoloringsegmentintheUnited
States.
As a result of its intense efforts in maintaining this edge, Combes presence in other
categoriesisnegativelyaffected.
Otherfactorsthatcontributetothesluggishsalesofthemarketerinothercategories
includelackofnewproductactivityandlackofinnovation.
RECENTDEVELOPMENTS
TherearenonotabledevelopmentsinCombein2012.
Newproducts
Thereislimitednewproductactivityforthemarketerin2012.
ThemarketerexpandsitsJustforMenbrandinthehaircoloringproductscategorywiththe
Autostophaircolorvariant.
Theproductisatechnologybreakthrough,involvingthedyeandthehydrogenperoxide
alreadymixedinasingletubewithascrewedoncomb.
Theeffectofthecolordoesnotgetdarkerthanitshouldirrespectiveofthetimeperiod
forwhichitiskepton.
Itcomesinareadytouseconvertibletube,colorshairin10minutes,andcomesinfive
permanentshades.
MARKETINGACTIVITY
Combe spends virtually most of its media expenditure on television advertisements and
Thecompanyspendsapproximately$38.8millionasTMEfor2012.
Of the total TME of $38.8million in 2012, $35.9million is spent on television
advertisements,andtheremaining$2.7millionisspentonmagazinepromotions.
JustforMenconductsafewadvertisementsperyear,whileGreciandoesnothaveany
4A90
Combe
Combealsooffersdiscountcouponstopromoteitsproducts.
Themarketerofferscouponswithdenominationsof$1.00and$2.00offonitsbrands
includingSeaBondandJustforMen.
Combe uses the Internet as one of the major sources of advertising and promoting its
brands.
The marketer uses social media sites, such as Facebook, Youtube, and Twitter, to
promoteitsproducts.
ThecompanyalsoadvertisesitsproductsonWalmartswebsite.
Themarketeralsoutilizesitsbrandswebsitesasanimportantmediumtopromoteits
products.
JustforMenbrandswebsitefeaturesadviceonhaircoloringandhelpsvisitorschoose
therightshadeofhaircolor.
Combe, which specializes in mens hair color, spends $33.1million promoting its brands
includingJustforMenandGrecianFormulain2012,up25.0%from$26.4millionin2011.
The marketer allocates almost 91.5% or $30.3million of its TME through television
advertisements.
The brand Just for Men is the main brand for the company and thus receives the
maximum TME support, with only a few thousand dollars spent on the other hair
coloringbrands.
Just for Men Autostop, launched in 2012, garners a significant share of the TME at
$22.1million.
OUTLOOK
Combessalesareprojectedtoshowamoderategrowthof1.2%duringtheforecastperiod.
Newproductlaunchesinthehaircoloringproductscategorywilllikelydrivethesales
ofCombeovertheforecastperiod.
Thecompanyplanstofocusonitsflagshipbrands,JustforMenandSeaBond,overthe
nextfiveyears.
The mens hair coloring products category will likely be the largest revenue generator for
Combeovertheforecastperiod.
The marketer is expected to revive with the launch of new products with innovative
formulations,suchasJustforMenAutostopline,whichisatechnologybreakthrough
involvingthedyeandthehydrogenperoxidebeingalreadymixedinasingletubewith
ascrewedoncomb,tosupportthecategorysgrowth.
Haircoloringproductsformencontinuestobeoneofthefastestgrowingsegmentsin
thecosmeticsandtoiletriesindustry.
Menofalldemographicgroupsaretakingtheinitiativeofusingandbuyinggrooming
products,andhaircolorformenstandstogrow.
The company is taking initiatives to educate its customers about its varied product
ranges.
Itisexpectedthattheresultwouldcreatealoyalcustomerbaseandboostsalesforthe
forecastperiod.
591
592
Combe
Themarketerisexpectedtoincreaseitsmarketingandpromotionalactivitiestosupportits
salesoverthenextfiveyears.
Thecompanyislikelytospendmoreonpromotingitsexistingproductsandsupportits
newproductintroductionsaswell.
ThemarketerwillcontinuetoallocatemajorityofitsTMEtotheJustforMenbrandin
order to maintain its position as the leading hair coloring brand for men over the
forecastperiod.
However,theshavingproductsandfragrancesformencategoriesforCombeareexpected
todeclineovertheforecastperiod.
LackofnewproductintroductionsandTMEsupportforthecategorieswillcontribute
tothedeclineovertheforecastperiod.
Moreover,themarketerisexpectedtofocusonitscorebrandsJustforMenandSea
Bondoverthenextfiveyears.
Sales are forecast to increase through 2017 at a CAGR of 1.2% to reach $167million, up
ToiletriesforCombebyCategory,2012to2017
Category
CAGR,%
2.0
COMPANYAVERAGE
1.2
Dentureproducts
0.8
(4.0)
Shavingproducts
(6.5)
Fragrancesformen
(11.0)
4A92
COTY
Table557:CotysSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
FRAGRANCESFORWOMEN
2012
Euphoria
24
23
DaisyEauSoFresh
15
15
Philosophy
15
15
DaisyMarcJacobs
13
14
14
Eternity
13
13
CKOne
11
12
HalleBerryr
12
12
JovanMuskr
12
12
PradaCandy
12
Fame
11
TruthorDare
11
CalgonBodyMists
10
Chloe
Obsession
CelineDionr
Oh,Lola!MarcJacobs
VeraWangPrincess
Lovestruck
FaithHill
Pulse
10
Heat
LoveChloe
MarkJacobsDot
HeatRush
(Continued)
REPRODUCTIONORDISCLOSURE FORBIDDEN;SEESPECIALNOTICE KLINE&COMPANY,INC.
594
Coty
2011and2012
$Million
Category/brand
2011
ForbiddenEuphoria
Lola
PradaInfusionD'Iris
Shaniar
VeraWang
Glowing
CKBeauty
CoolWaterWoman
Lovelyr
MarcJacobs
L'AirDuTemps
VanillaFields
BabyPhatGoddess
GuessbyMarciano
GlowbyJLo
LadyStetson
AntonioBanderasforWomen
WildMuskr
AdidasMovesforHer
PlayboyforHer
212CarolinaHerrera
CarolinaHerrera
Emeraude
Exclamation
GuessforWomen
L.A.M.B.
HarajukuLovers
LivebyJenniferLopez
NauticaforWomen
(Continued)
4A94
2012
Coty
2011and2012
$Million
Category/brand
2011
2012
Prada
Sand&Sable
Covet
CovetPureBloom
VanillaMusk
29
29
315
345
NAILPOLISHES
SallyHansenr
229
210
OPI/Nicoler
31
40
NYCNewYorkColor
10
10
275
264
Stetson
17
17
AdidasForMenr
15
16
EternityForMen
13
13
ObsessionforMen
12
12
EuphoriaMen
11
12
McGrawr
13
12
CoolWater
11
11
EternityAqua
10
1Million
JovanMuskForMen
PlayboyforHim
11
NauticaVoyage
EuphoriaMenIntense
PradaMen
DavidBeckhamr
Allother
Total
Rimmelr
Totalr
FRAGRANCESFORMEN
(Continued)
595
596
Coty
2011and2012
$Million
Category/brand
2011
Encounter
GuessSeductiveHomme
ConnectedKennethColeReaction
KennethColeReaction
AntonioBanderasforMenr
PradaAmberPourHomme
KennethColeNewYorkBlack
PreferredStock
CKFree
212CarolinaHerrera
JOOP!
PradaAmberPourHommeIntense
KennethColeRSVP
Gravity
MuskForMen
Bang
MarcJacobsMen
NauticaOcean
VeraWangMen
DavidoffAdventure
15
16
195
196
Rimmelr
52
57
NYCNewYorkColorr
15
18
Totalr
67
75
Rimmel
25
26
NewYorkColorr
13
14
Allotherr
Totalr
EYEMAKEUP
FACEMAKEUP
(Continued)
4A96
2012
Coty
2011and2012
$Million
Category/brand
2011
FACEMAKEUP(Continued)
2012
SallyHansen
Coty
49
49
48
46
45
46
19
26
20
27
14
15
Totalr
FACIALTREATMENTS
Philosophy
SallyHansen
Rimmelr
SallyHansen/Naturistics/NYCr
Totalr
Philosophy
Adidasbodywashes
Total
HANDANDBODYLOTIONS
Philosophy
SallyHansen
Total
Adidas
20
21
10
11
11
12
TOTALr
1,048
1,086
rRestated.
NOTE:"Allother"includessalesofsmallerbrandsthatthecompanyowns.
COMPANYOVERVIEW
Foundedin1904inParis,CotyInc.isaleadingmanufacturerofglobalmassmarketaswell
asprestigefragrancesformenandwomen.
ThecompanysheadquartersarelocatedinNewYork,NY.
The company is an operational subsidiary of the German holding company, Joh. A.
Benckiser.
InJune2012,Cotyfilestotakethecompanypublic.
Theglobalemployeecountattheendoffiscalyear2012isabout12,000.
597
598
Coty
Coty specializes in the production of fragrances, skin care products, other toiletries,
andmakeup.
ThecompanyhassixresearchanddevelopmentfacilitiessituatedintheUnitedStates,
Europe,andChina.
ItalsohasmanufacturingsitesintheUnitedStates,France,theUnitedKingdom,Spain,
andChina.
Cotyhasoperationsin30countries,anditsproductsaresoldinmorethan90markets
worldwide.
Thecompanyhasadopteddistributionchannelsstrategicallytocomplementtheimage
ofitsproductsandbrands.
Itsdistributionpartnersincludeupscaledepartmentstores,specialtyretailers,upscale
perfumeries,pharmacies,massmarketretailers,anddutyfreeshopsatairports.
Thecompanysbrandsarecategorizedintotwomainclasses:
CotyBeauty,aunitofCotyInc.,wasformedin2007inordertomakeasingleplatform
combiningthemassmarketbusinessesoftheAmericas,Europe,andAsia.
The company markets leading mass brands, including Adidas, Aspen, Astor, Beyonc,
Borghese, Celine Dion, Chupa Chups, David and Victoria Beckham, Desperate
Housewives, Esprit, Exclamation, Isabella Rossellini, Jovan, Kate Moss, Kylie Minogue,
MaryKateandAshley,MissSixty,MissSporty,Playboy,PierreCardin,Rimmel,Shania
Twain,Stetson,andVanillaFields.
CotystoptenbrandsAdidas,Chloe,CalvinKlein,MarcJacobs,Playboy,OPI,Davidoff,
Philosophy,SallyHansen,andRimmelareknownaspowerbrandsthatyieldnearly
70%ofthecompanysnetrevenuesinfiscalyear2012.
TheCotyPrestigeunit,adivisionofCoty,wasformedin2006tomarketitsprestigebrands.
The unit has 23 exclusive brands in its portfolio and is distributed in luxury stores
worldwide.
It includes luxury brands such as Balenciaga, Calvin Klein, Cerruti, Chlo, Chopard,
Davidoff, Jennifer Lopez, Jette Joop, Jil Sander, JOOP!, Karl Lagerfeld, Kenneth Cole,
L.A.M.B.fragrancebyGwenStefani,Lancaster,MarcJacobs,Nautica,Nikos,BabyPhat,
PahtFarm,SarahJessicaParker,OPI,VeraWang,andVivienneWestwood.
TotalsalesforCotygrow12.2%in2012,from$4.1billionin2011to$4.6billionin2012.
4A98
599
Coty
Table558:CotysGlobalCorporateSales,2007to
2012
Yeara
$Billion
Change,%
2007
3.3
14.0
2008
4.0
21.2
2009
3.5
(12.5)
2010
3.6
2.9
2011
4.1
14.0
2012
4.6
12.2
aYearendingonJune30.
Table559:CotysGlobalCorporateSalesby
ProductCategory,2012
Category
%Oftotal
Fragrances
55.4
Colorcosmetics
29.1
Skin,sun,andpersonalcare
15.5
Total
100.0
Thesplitofthecompanystotalrevenuesbyregionisasfollows:
Europe,theMiddleEast,andAfrica(EMEA)continuetobethelargestmarketforthe
company,generating48.6%oftherevenuesforthefirstninemonthsinfiscal2012.
The contribution to corporate sales from the Americas is 40.2% for the first nine
monthsinfiscal2012,a29%increasefromthefirstninemonthsinfiscal2011.
AsiaPacificcontributes11.1%toCotyssalesforthefirstninemonthsinfiscal2012.
Coty Beauty, the mass marketing arm, contributes 49% to Cotys sales, and Coty Prestige
generates51%ofthecompanyssales.
Sales for Cotys U.S. cosmetics and toiletries increase from $1,048million in 2011 to
ThecompanyssaleshavegrownatCAGRof3.3%since2007.
5100
Coty
Table560:CotysCosmeticsandToiletries
Year
$Million
Change,%
2007
923
2008
945
2.4
2009
918
(2.9)
2010
961
4.7
2011
1,048
9.1
2012
1,086
3.6
Cotyisinsecondplaceinthefragrancesproductclasswitha14.2%shareoftotalfragrances
salesin2012.
The company ranks second in both the mens fragrances and womens fragrances
categories.
Coty continues to be the secondleading marketer of fragrances forwomen, commanding

12.7%oftotalcategorysales.
Thecategoryssalesgrowby9.5%in2012,from$315millionin2011to$345millionin
2012.
Thecompanysshareinthecategoryincreasesfrom12.1%in2011to12.7%in2012.
Coty continues to compete in both the luxury and mass trade classes with an
assortmentofcelebrityanddesignerscents.
Euphoria continues to be the leading brand for Coty in the category in 2012. Sales
declineby4.2%,from$24millionin2011to$23millionin2012.
AsidefromthedebutofLadyGagaFameandMadonnaTruthorDare,theonlyother
majorfemalefragrancelaunchesof theyearareMarcJacobsDotandJenniferLopez
Glowing.
Coty launches a series of new scents in early 2013 including Guess Girl and See by
Chloe.
The only major mass launch for Coty during 2012 is an extension of the Halle Berry
franchisecalledCloser.
Cotyisthesecondleadingmarketerinthefragrancesformencategoryin2012.
Cotys sales in the category grow 0.5% from $195 million in 2011 to $196 million in
2012.
Thecompanyscategorysharedeclinesfrom18.3%in2011to17.8%in2012.
Stetson continues to be the leading brand for the company in 2012. The sales of the
brandareflatat$17millionin2012,constantwith2011levels.
CotysbiggestdeclineisfromthesluggishnessinKennethColescentsales,afranchise
whichCotylosesasoflate2012.
ManyofCotysmajorscentshaveeitherrelativelyflatorslightlyupwardsalessuchas
EternityforMen0.0%,Euphora9.1%,andEternityAqua11.1%
Encounteristhemajorlaunchoftheyearwithsalesreaching$3million.
4A100
Coty
5101
Unlikemanyothermarketersthatcompeteineithertheluxuryorthemasstradeclass,
Cotyisactiveinboth.
ManyofCotysmassscents,suchasStetson,McGraw,andPlayboy,experienceflator
decliningsales.
Since2006,inadditiontoitsownbrands,CotydistributesanumberofPuigsbrandsin
North America, including Prada, Nina Ricci, Carolina Herrera, Antonio Banderas, and
Paco Rabanne, which are reflected in Cotys total sales. However, Coty will cease to
distributePuigfragranceswhenthelicenseexpiresonJune30,2013.
Cotycontinuestobethefifthleadingmarketerinthemakeupproductclassin2012.
Itsmakeupsalestotal$415millionin2012,up1.0%from$411millionin2011.
TheSallyHansenbrandrepresents52.5%ofthemarketersmakeupsalesin2012.The
branddeclines8.0%in2012withsalesof$218million,asitdoesnotprovideenough
newnesstogrowsalesfrom2011.
NailpolishisthemostimportantmakeupcategoryofCotyasitrepresents63.6%ofits
makeupsales,with$264million.
Cotysnailpolishesmarketsharedeclinesfrom56.6%in2011to45.2%in2012.Growth
in the nail polish market overall, is 29.9%. Coty faces stiff competition from the
plethoraofnewlaunchesinthemassandspecialtytradeclasses.
Rimmel is the secondleading brand in Cotys makeup portfolio behind Sally Hansen.
Rimmelsalesreach$113millionin2012,up11.9%from$101millionin2011.Rimmel
represents27.2%ofCotymakeupsalesin2012.
EyemakeupistheleadingcategoryfortheRimmelbrandwithsalesof$57millionin
2012,up9.6%from2011.
RECENTDEVELOPMENTS
Acquisitions
InApril2012,CotyproposestoacquireAvon.
InMay2012,AvonturnsdownCotysproposalforitsacquisition.
In February 2013, Coty and Puig announce not to renew their distribution agreement in
NorthAmerica.
Managementchanges
In July 2012, Coty appoints Michele Scannavini as the new CEO after Brend Beetzs
retirement.
ScannavinihasbeenpresidentofCotyPrestigeformorethan10years.
5102
Coty
In September 2012, Coty announces Jean Mortier as the new Global President of Coty
Prestige.
InNovember2012,CotyannouncesMarcReyasitsnewRegionalVicePresidentforNorth
America.
Licensingagreements
In October 2012, Coty announces its agreement with Karl Lagerfeld to end its existing
fragrancelicense.
Otherdevelopments
InJune2012,Cotyfilestogopublic,afteritswithdrawalfromAvonstakeoveroffer.
Cotyplanstoraiseupto$700millionthroughitsIPO(initialpublicoffering),following
which,itsshareswillbeoffloadedbyallitsexistingshareholders.Thecompanydoes
notrevealthenumberofsharesthatitplanstoofferintheIPO.ThisIPOisexpectedto
open doors to a greater number of investment opportunities, for its German
conglomerateJoh.A.Becker.
InSeptember2012,CotydecidestoputasideitsplansofitsIPO,postponingitto2013.
The decision to delay the IPO is taken in order to give the newly appointed CEO
MicheleScannaviniconsiderabletimetoadjusttohisrole.
June 13, 2013, Coty finally is offered on the New York Stock Exchange under symbol
COTY,at$17.50pershare.
InDecember2012,CotyPrestigeannouncesThomasDutronc,aFrenchGuitarist,astheface
ofthenewCerrutifragranceformen.
NEWPRODUCTS
Table561:SelectNewProductsIntroducedbyCotyintheUnitedStatesin2012
Brand
CalvinKlein
HalleBerry
Category
Description
Fragrancesformen
EncounteristhenewestCalvinKleinscentand
openswithmandarin,cardamom,andrum,
alongwithpepper,jasmine,patchouli,and
cognac
Fragrancesforwomen
Closerisconsideredamodernfemininefloral
thatopenswithaccordsofozone,wild
raspberry,andwaterlily
(Continued)
4A102
Coty
Table561:SelectNewProductsIntroducedbyCotyintheUnitedStatesin2012
Brand
Category
Description
Fragrancesforwomen
Glowingisawoodyfloralwithtopnotesof
bergamot,mandarin,andcypressinabottle
thatlightsupandglowsfor15secondswhen
used
Fragrancesforwomen
LadyGagasdebutscent,Fameisbuilton
threemainaccords:darkaccord,sensual
accord,andlightaccord.Thedarkaccord
includespoisonousflowerBelladonnaand
incense.Scentspraysonblackandturnsclear,
andishousedinablackbottle
Madonna
Fragrancesforwomen
TruthorDareisMadonnasfirstscentandis
describedasbeingbothlightanddark,
openingwithnotesofgardenia,creamy
tuberose,andneroli
MarcJacobs
Fragrancesforwomen
Dotisfloralfruity,surroundedwithexotic
notesofcoconutandwrappedinsoftvanillain
aladybuginspiredbottle
PacoRabanne
Fragrancesformen
OneMillioncomestotheUnitedStates.It
includesnotesofgrapefruit,redorange,mint,
rose,cinnamon,spices,leather,wood,
patchouli,andamber
Prada
Eyemakeup
ScandaleyesWaterproofKohleyeliner
Rimmel
Eyemakeup
LashAcceleratorEndlessmascara
SallyHansen
Nailpolishes
NewCompleteSalonManicure
SallyHansen
Nailpolishes
New&ImprovedDiamondStrengthNoChip
NailColor
SallyHansen
Nailpolishes
MagneticNailColor3Dnailartinseconds
JenniferLopez
LadyGaga
MARKETINGACTIVITY
Cotyincreasesitstraceablemediaexpenditures(TME)by15.8%,to$283.3millionin2012
Magazine advertising at $234.9 million continues to be the preferred medium to
promotethecompanysproductsin2012.
Coty spends about 82.9% of its TME on magazines and 16.1% on television
advertisements.
Cotyistheleadingfragrancesadvertiserwith$128.7millionasTMEin2012.
In 2012, TME for womens fragrances decrease 25.1% to $76.4 million, down from
$102millionin2011.
TMEformensfragrancesis$31.7millionin2012,up23.8%from$25.6millionin2011.
5103
5104
Coty
Coty spends $104 million on its nail polish brands. TME for Cotys nail polishes are up by
65.1%, from $63.0 million in 2011. This figure includes spending for the companys Sally
Hansen,OPI,andNicolebrands.
Magazines are the primary medium used to promote the companys brands and
products.
TheSallyHansenbrandissupportedwith$46.5millioninTMEin2012.Aboutonethird
oftheexpendituresupportstheSalonEffectsfranchise.
OPIProductsreceiveTMEof$43.2millionin2012,upby70.8%,from$25.3millionin
2011.About40%oftheTMEsupportsthebrandsGelcolorline.
OPINicoleissupportedwith$13.8millioninTMEin2012.
All of Cotys brands, especially OPI Nicole, use seasonal and/or limited edition color
collectionsasawaytomotivateconsumerstodrivesalesandrepurchaseoften.
Coupons are regularly made available in magazines, online, as well as on retailer
shelves.
CotyincreasinglypromotesitsSallyHansenbrandthroughsocialmediasites,suchas
Facebook, Twitter, and Pinterest, and offers howto tutorials on the brands website
andonYouTube.
SallyHansenfeaturesanIlovenailartcontesttowincashprizesandatriptoNew
York on its website to promote its products. Viewers can vote through the brands
websiteorthroughPinterestandTwitter.
Promotionalvehiclesformassbrandslargelyincludepricediscountsandcoupons.
OPIrefreshesitslinebycobrandingorpromotinglimitededitionshades.Forexample,
OPI launched new shades inspired by James Bonds new movie Skyfall and a Vintage
MinnieMousecollection,aswellascolorsinspiredbysingerMariahCareyandbythe
Kardashiansisters,KendallandKylie.
Themarketeralsooffersdiscountcouponsonitswebsitetopromoteitsproducts.
The company offers discount coupons of different denominations. For example, Coty
offers $1.00 off on any Sally Hansen nail product and $3.00 off on any Rimmel Stay
MatteFoundation.
Cotycontinuestosigncelebritiestolaunchnewproductsandpromoteexistingbrands.
In January 2012, the company signs Kristen Stewart as the face of its Balenciaga
fragranceforwomen,toberevealedinfall2012.
Themarketerincreasesitspresenceonsocialmediawebsitestopromoteitsproducts.
Coty is increasingly promoting its brands on social websites, such as Facebook,
Pinterest,Twitter,andYouTube,togaininstantacceptanceamongconsumers.
Cotyoffersgiftsetsinordertoattractcostconsciousconsumers.
Coty specializes in giftwithpurchase (GWP) promotion offers to support its sales
growth.
The marketer offers free gifts with a purchase of $50.00 or more for its Philosophy
brandthroughitswebsite.
Cotyoffersgiftsetsandshippingoffersforvariousproductsthroughouttheyearasa
partofitspromotionalactivity.
Consumers can also receive free gifts and offers by signing up for newsletters on its
website.
4A104
Coty
Cotyalsodistributesscentedstripsinmagazinesassamplestoattractmorecustomers.
OUTLOOK
Cotyisprojectedtogrowmoderatelyby2.7%overtheforecastperiodfrom2012to2017.
Themarketerislikelytopostpositivegrowthinallthecategoriesthatitcompetesin.
Newproductlauncheswithbettertechnologieswillsupporttheoverallgrowthofthe
marketerinthefuture.
Cotyisalsoexpectedtoincreaseitsmediaspendingovertheforecastperiodtosupport
itssalesgrowth.
Themakeupproductclasswilllikelydrivethesalesofthemarketerovertheforecast
period.
Fragrances, the largest product class for Coty, will continue to be the largest revenue
generatorforthecompanyovertheforecastperiod.
Themarketerisexpectedtooffercollectionsofsmallcoffretsofitsscentstohelpkeep
consumersloyaltothecompanyand/orbrandwhilestillsatisfyingconsumersneedfor
variety.
Theindustryisexpectedtolaunchfragranceswithadditionaladvantagesbeyondjust
impartingascent,possiblyhealthbenefitssuchasloweringbloodpressure,improving
sinuscongestion,andoverallrelaxation.Coty,asamajorfragranceplayer,isexpected
toleadsuchinnovations.
However,thegrowthofCotysfragrancesproductclasswillbelimitedovertheforecast
period,asthelicenseofPuigfragrancesexpiresin2013,andPuigfragranceshavebeen
veryimportanttoCoty.
Themakeupproductclassisforecasttoperformwelloverthenextfiveyears.
NailpolisheswillbethelargestrevenuegeneratorforCotyinthemakeupproductclass
Cotyisforecasttopostgrowthinthenailpolishescategorysupportedbynewproduct
launches.
Coty will continue to be the leading marketer in the nail polishes category over the
forecastperiod.
The marketer is expected to launch innovative products such as textured nails,
magneticnailpolish,andglitternailpolishtosupportitssalesgrowth.
Coty will likely increase its marketing and promotional activities in the nail polishes
categorytosupportthecategorysgrowth.
Theeyemakeupcategoryisforecasttopostgrowthof4.0%forCotyoverthenextfive
years.
5105
5106
Coty
Themarketerisexpectedtolaunchinnovativeproductswithmultibenefitssuchas
quickerdryingtimeandheat/smearresistancethatarelikelytocontributetosales
growthoftheeyemakeupcategory.
Coty should also launch limitededition eye shadow collections to add incremental
salesthroughouttheyearandtocreateexcitement.
ThefacemakeupcategorywilllikelypostgoodgrowthforCotyoverthenextfiveyears.
Themarketerwilllikelyintroducefoundationswithmultipleskincarebenefits,aswell
asbreathablefeeltodrivesales,alongwithnewtechnologyinproductforms.
Theproductswithantiagingandsuncarebenefitswilllikelydrivesalesoffacemakeup
productsovertheforecastperiod.
Coty is expected to increase its TME support for its makeup product class over the
forecastperiod.
Cotywillcontinuetoalignwithcelebritiesyetwillbemorecautiousaboutthecelebrities
thatitchooses.
Themarketerisexpectedtosignagreementswithdesigners,artists,andentertainers
tolaunchnewbrandsorforpromotingexistingbrandextensions.
Howeveritsnewstatusasapubliccompanywillforceittobecomemorecautiouswith
itsinvestmentsandthefamouspeopleitalignsitselfwith.
Coty is expected to continue to spend on its advertising and promotional activities in the
fiveyearforecastperiodinordertoattractmorecustomers.
Printmediaandtelevisionadvertisingwillcontinuetobethepreferredmediatoolsfor
Coty.
Engaging consumers through social media will become an important medium,
especiallyasreadershipofmagazinesdeclines.
Cotys cosmetics and toiletries sales are projected to increase at a CAGR of 2.7% to
$1,238millionby2017from$1,086millionin2012.
ToiletriesforCotybyCategory,2012to2017
Category
Nailpolishes
Eyemakeup
Facemakeup
Facialtreatments
COMPANYAVERAGE
Fragrancesforwomen
Fragrancesformen
Handandbodylotions
CAGR,%
4.2
4.0
3.9
3.0
2.7
2.7
2.2
1.8
1.5
1.5
1.0
1.0
4A106
ELIZABETHARDEN
Table563:ElizabethArdensSalesofCosmeticsandToiletriesintheUnitedStates,2011
and2012
$Million
Category/brand
2011
FRAGRANCESFORWOMEN
2012
VivaLaJuicy
27
30
WhiteDiamonds
19
18
14
24
13
11
RedDoor
11
10
Someday
35
10
WonderstruckEnchanted
JuicyCouture
BCBGMaxAzria
EdHardyBornWildr
11
CoutureCouture
LuckyYou
Pretty
Villain
WhiteShoulders
FantasyBritneySpears
Hearts&Daggers
Believe
CircusFantasy
EdHardyLove&Luck
Forever
LollipopBling
Girlfriend
Wonderstruck
PinkFriday
EdHardyWomenr
(Continued)
5108
ElizabethArden
and2012
$Million
Category/brand
2011
Peace,Love,&Juicy
5thAvenue
CuriousBritneySpears
CurveCrushforWomen
CurveforWomen
Design
GreenTea
LusciousPink
MbyMariah
Mediterranean
UsherShe
UsherUR
WithLoveHilaryDuff
201
188
51
50
CurveForMen
EdHardyLove&Luckr
EdHardyVillianr
HalstonMen'sFragrance
JohnVarvatos
JohnVarvatosStar
P.S.
TrueReligion2
CurveCrush
DirtyEnglish
DrifterforMenr
EdHardyHearts&Daggersr
EdHardyMenr
Totalr
FACIALTREATMENTS
ElizabethArdenr
FRAGRANCESFORMEN
(Continued)
4A108
2012
ElizabethArden
and2012
$Million
Category/brand
2011
2012
UsherHe
Roccawear9X
Allother
34
27
14
14
313
290
Totalr
FACEMAKEUP
ElizabethArden
EYEMAKEUP
ElizabethArden
ElizabethArden
HANDANDBODYLOTIONS
ElizabethArden
NAILPOLISHES
ElizabethArden
TOTALr
rRestated.
COMPANYOVERVIEW
Elizabeth Arden Inc., established in 1910, is one of the largest global prestige beauty
productsmarketers.
The companys portfolio in the cosmetics and toiletries industry comprises prestige
fragrances,skincare,andcosmeticsbrands.
ElizabethArdensprestigefragrancesportfolioisdividedintocelebrityfragrances,lifestyle
fragrances,anddesignerfragrances.
Celebrity fragrances include brands such as Britney Spears, Elizabeth Taylor, Mariah
Carey,TaylorSwift,JustinBieber,NickiMinaj,andUsher.
Lifestyle fragrances include Curve, Giorgio Beverly Hills, P.S. Fine Cologne, and White
Shoulders.
Designer fragrances include Juicy Couture, Kate Spade New York, John Varvatos,
Rocawear,BCBGMaxAzria,AlbertaFerretti,Halston,GeoffreyBeene,AlfredSung,Bob
Mackie,andLucky.
The company also distributes approximately 250 prestige fragrance brands in the
UnitedStatesthroughdistributionagreements.
5109
5110
ElizabethArden
The companys headquarters are located in Miramar, FL while regional administrative

headquartersforthecompanyarelocatedinNewYork,Geneva,andStamford.
Thecompanysellsitsproductsinmorethan100countriesthroughperfumeries,boutiques,
departmentstores,travelretailoutlets,anddutyfreeshops,aswellasontheInternet.
In addition to marketing its own brands, the company also acts as a distributor for other
fragrancemarketers.
Leading retailers for Elizabeth Ardens products include Macys, Dillards, Belk, JCPenney,
Saks, Bloomingdales, Nordstrom, Walmart, Target, Sears, Kohls, Walgreens, CVS, Boots,
Debenhams,Sephora,Marionnaud,Douglas,andWorldDutyFree.AsofAugust2012,the
companyemploysabout2,357fulltimeemployeesacrossalllocations.
It also employs approximately 432 parttime employees in the United States and 17
othercountries.
Corporate sales of Elizabeth Arden increase by 5.3% from $1,175.5 million in 2011 to
In2012,netprofitsofthecompanytotal$57.4million,up40.0%from$41.0millionin2011.
Since2007,salesofElizabethArdenwitnessacompoundannualgrowthrate(CAGR)of
1.9%.
Table564:ElizabethArdensGlobalCorporateSales,2007to2012
$Million
Yeara
Sales
Netprofits
Marginonsales,%
2007
1,127.5
37.3
3.3
2008
1,141.1
19.9
1.7
2009
1,070.2
(6.2)
(0.6)
2010
1,103.8
19.5
1.8
2011
1,175.5
41.0
3.5
2012
1,238.2
57.4
4.6
Fragrancescommand76.1%ofthecompanystotalsalesworldwidein2012.
Salesincreasefrom$900millionin2011to$942millionin2012.
4A110
ElizabethArden
Table565:ElizabethArdensGlobalCorporateSalesbyProductCategory,2011
and2012
$Million
%Oftotal
Category
2011
2012
2011
2012
Fragrances
900.3
941.9
76.0
76.1
Skincare
207.1
226.4
18.0
18.3
Cosmetics
68.1
70.0
6.0
5.6
1175.5
1,238.2
100.0
100.0
Total
TheU.S.marketcontributes58.1%tothecompanysbusinessin2012.
Table566:ElizabethArdensGlobalCorporateSalesbyCountry,2011and2012
$Million
%Oftotal
Region
2011
2012
2011
2012
UnitedStates
701.6
718.8
59.7
58.1
70.0
71.7
5.9
5.8
403.9
447.6
34.4
36.1
1,175.5
1,238.2
100.0
100.0
UnitedKingdom
Allother
Total
ManufacturerssalesforElizabethArdenintheU.S.cosmeticsandtoiletriesmarketdecline
Since2007,saleshavegrownataCAGRof0.8%.
Table567:ElizabethArdensCosmeticsandToiletriesSales
Year
$Million
Change,%
2007
279
2008r
298
6.8
2009r
316
6.0
2010r
286
(9.5)
2011r
313
9.4
2012
290
(7.3)
rRestated.
5111
5112
ElizabethArden
The fragrances product class commands 74.1% of the companys cosmetics and toiletries
salesintheUnitedStatesin2012.
Sales in the fragrances category experience a decrease from $235million in 2011 to
$215millionin2012.
ElizabethArdencaptures5.6%ofthefragrancesproductclasssalesintheUnitedStates
in2012.
Mass retailers, such as Walmart and Target, and chain drug stores, such as CVS and
Walgreens, continue to be the fastestgrowing distribution channels for Elizabeth
Ardenintheluxuryfragrancessegment.
Fragrances for women is the largest product category for the company, accounting for
$188millioninsalesin2012,down6.5%from$201millionin2011.
SalesdeclineduetoweaksalesinthenewlyacquiredEdHardyfranchise,alongwitha
sales drop of the first Justin Beiber scent, and less than expected growth with the
secondscent.
ElizabethArdenmovesintofourthplacewiththeacquisitionoffragrancebrandsfrom
NewWaveFragrancesandGiveBackBrands.
ElizabethArdenacquirestheglobalfragrancelicensesofEdHardy,TrueReligion,and
BCBGMaxAzriafromNewWaveFragrancesinmid2012.Italsoacquiresthefragrance
licensesofJustinBieberandNickiMinajfromGiveBackBrands,LLC.
These acquisitions help Elizabeth Arden achieve a 6.9% share in the fragrances for
womencategory.However,evenincludingthebrandsnewtothestable,overallsales
declineby6.5%.
ThemajornewscentfromElizabethArdenduring2012isNickiMinajPinkFridayand
JustinBeiberGirlfriend.
Facialtreatmentsisthecompanyssecondlargestproductcategory,representing17.2%of
thecompanysU.S.cosmeticsandtoiletriessalesin2012.
Categorysalesdeclineby2.0%from$51millionin2011to$50millionin2012.
Thecompanyaccountsfor0.8%ofthetotalcategoryssalesin2012.
Limited promotional support and lack of new product activity offsets the marketers
FragrancesformenisthethirdlargestcategoryforElizabethArden,generating9.3%ofthe
Salesdecline20.6%from$34millionin2011to$27millionin2012.
ElizabethArdenisplacedeighthinthemensfragrancescategory,accountingfor2.5%
oftheU.S.mensfragrancessalesin2012.
ThemarketerintroducesEdHardyinthemensfragrancescategoryin2012.
Themakeupproductsclassgenerates7.9%ofthecompanyssalesin2012.
Face makeup, the largest makeup category for the company, registers sales of
$14millionin2012,flatwith2011levels.
Eyemakeupalsoexperiencesflatsalesof$5millionin2012.
4A112
ElizabethArden
RECENTDEVELOPMENTS
InMay2012,ElizabethArdenacquiresgloballicensesandcertainassetsassociatedtothe
EdHardy,TrueReligion,andBCBGMaxAzriafragrancebrandsfromNewWaveFragrances
foranundisclosedprice.
In June 2012, the company acquires global permits to the Justin Bieber and Nicki Minaj
fragrancebrandsfromGiveBackBrandsforanundisclosedprice.
In2012,themarketeracquirestheCurveFragrancefranchisefromFifth&Pacific(formerly
knownasLizClaiborne)foranundisclosedprice.
InSeptember2012,ElizabethArdenannouncesinvestmentinRedDoorSpaHoldings.
Newproducts
Table568:SelectNewProductsIntroducedbyElizabethArdenin2012
Brand
Category
Description
EdHardy
Fragrancesfor
men
VillianopenswithnotesofItalianBergamotandFrenchlavenderalong
withmasculinespicesandEgyptianbasilandwildsage
JustinBeiber
Fragrancesfor
women
GirlfriendisJustinBeiberssecondscentandisgearedtohisadolescent
fanbase.Topnotesincludemandarin,blackberry,pear,andstrawberry
NickiMinaj
Fragrancesfor
women
FirstfragrancefromNickiMinaj,PinkFriday,namedafterherfirstalbum
ofthesamename,isafloralmuskcontainingnotesofpinkflowerpetals,
creamyvanilla,musk,andwoods.Thefragranceishousedinabottle
shapedbustofMinajcompletewithapinkwig
TaylorSwift
Fragrancesfor
women
WonderstruckEnchantedisthesecondfragrance,presentedasaflanker
fromtheyoungpopcountrysingerTaylorSwift.Scentisanoriental
gourmand,thatopenswithnotesofwildberries,pinkpoppy,andpassion
fruit.Asintheoriginal,thebottleisadornedwithdanglingcharms
MARKETINGACTIVITY
The companys annual spend on mediabased advertising and promotional activities is

$57.0millionin2012,up9.0%,from$52.3millionin2011.
The fragrances product class claims 77.3% of the total traceable media expenditures
(TMEs)in2012.Thedollaradvertisingexpenditureamountsto$44.1million.
Thefragrancesforwomencategoryaccountsfor78.9%ofthetotalmediaspendingby
the marketer in the fragrances product class in 2012, with TME amounting to
$34.8million.
Skin care is the secondmost advertised product class, with TME of $10.7 million in
2012.
5113
5114
ElizabethArden
The company ensures that each of its fragrance, skin care, and cosmetics products are
distinctivelypositionedwithexclusiveadvertisingthemes,logos,andpackaging.
ElizabethArdenutilizesprintmedia,television,andradioadvertising,andpointofsale
merchandising, including displays and sampling, the Internet marketing, and mobile
marketingtoolstopromoteitsbrands.
Thecompanyoffersfreenewsletters,shippingoffers,andbeautyrewardsonfreesignup
onitswebsite.
It also promotes its brands through social networking websites such as Facebook,
MySpace,andTwitter.
Themarketeralsoleveragesnewmarketingmediums,includingmobilemarketingand
socialmediatoengagewithtechnologicallysavvyconsumers.
The company provides free shipping and a gift with a purchase of $40.00 through its
website.
ProductsamplingisanimportantmeansofpromotionforElizabethArdensproducts.
Scented strips in magazines and scented blotter cards distributed in retail stores are
commonwaysforsamplingfragrances.
The company also distributes samples of select antiaging products in department
stores.
Elizabeth Arden encourages giftwithpurchase (GWP), an important promotional activity

forthecompany.
Thesesetstypicallycontaineitheravarietyoffragranceminiatures,orafragranceand
ancillaryproducts.
Thesesetsarepopularduetotheiremphasisonvalueandthefactthattheytypically
costlessthaniftheindividualcomponentsarepurchasedseparately.
Anotherimportantpromotionalactivityusedbythemarketerforitsmakeupandskincare
productsisproductdemonstrationbysalesrepresentativesatinstorecounters.
OUTLOOK
ElizabethArdenisforecasttopostgrowthof1.5%overtheforecastperiod,supportedby
newproductlaunchesacrosscategories.
Thegrowthofthecompanywillbesupportedbynewproductlaunchesacrossskincare,
fragrances,andmakeupcategories.
ThemarketerisexpectedtoincreaseitsTMEspendinordertosupportitsoverallsales
4A114
ElizabethArden
The marketer repositions its brand globally in 2012 by modernizing its presentation to
appealafreshtowomenbyhonoringthestrongheritageofthebrand.
Thekeyelementsonthebrandsrepositioningincludesimprovedproductformulations,
packaging,andcounterredesign,andthisisexpectedtoaddmoresalesduringthenext
fiveyears.
Alltheproductsunderthebrandwillhaveaunifiedlookgloballytoengageconsumers
interestacrossallmarkets.
The repositioning of the brand includes the introduction of communication that is
designedtoreflectandreinforcethebrandsrevitalized,modernpositioning.
The marketer relaunches its website enhanced with capabilities including delivering
shoppingexcellenceinteractiveplatformforkeepingconsumersengagedandbuilding
brandequity.
Themarketerwillcontinuetofocusonacquiringfragrancebrandsandlicensesofvarious
fragrance brands over the forecast period in order to strengthen its position in the
fragrancesproductclass.
In2012,themarketeracquiresgloballicensesandcertainassetsassociatedtotheEd
Hardy,TrueReligion,andBCBGMaxAzriafragrancebrandsfromNewWaveFragrances.
The acquisition of these brands will strengthen the position of the marketer in the
fragrancesproductclassoverthenextfiveyears.
Elizabeth Ardens market share is also expected to grow in the future with the
expansionofitsfragrancefranchises.
Themarketerisexpectedtoexpanditsdistributionforitsfragrancesbrandsthroughluxury
outletsintheUnitedStatesandEuropein2013tosupportitsgrowth.
Themarketerwillcontinuetofocusonlaunchinginnovativeproductsacrossthecategories
inthefuture.
In2012,thecompanylaunchesanewproduct;BritneySpearsfantasytwist,whichisa
uniquelypackagedduofragrancecontainingbothFantasyandMidnightFantasy,twoof
themostpopularfragranceswithintheBritneySpearsfranchise.
Themarketerwillfocusonthemostsuccessfulfragranceswithintheirrespectivelines
tomaintainsustainablegrowthovertheforecastperiod.
ThefragrancesproductclasswilllikelybethelargestrevenuegeneratorforElizabethArden
Themarketerwillcontinuetolaunchmorefragrancesinordertosupportitsgrowthin
thecategory.
ThemarketerplanstolaunchEdHardySkullsandRosesfragrancesforbothmenand
womenin2013tosupportitssales.
ThemarketshareofElizabethArdenintheprestigefragrancescategorygrowin2012
due to the launch of various fragrances, and will continue to grow in the forecast
period.
5115
5116
ElizabethArden
Themarketerwillincreaseitsmediaspendforitsfragrancesovertheforecastperiodin
ordertosupportitsgrowth.
Celebrityfragrancesareexpectedtodrivethesalesofthefragrancesproductclassfor
themarketerinthefuture.
Fragrance brands, such as Britney Spears, Juicy Couture, Curve, Rocawear, and John
Varvatos,areimportantforthemarketer.Itislikelythatnotallofthesewillcontinue
tobewinnersinthecategory.
Thefacialtreatmentscategoryisexpectedtoperformwellforthemarketeroverthenext
fiveyears.
The marketer launches a successful line of skin care products under the Visible
Differencebrandin2012toattractyoungerconsumersthroughanentrypricepointto
supportitssales.
Themarketerwillcontinuetolaunchsuchproductsinthefuture.
GrowingdemandforantiagingproductsintheUnitedStateswillalsocontributetothe
categorysgrowthoverthenextfiveyears.
Themarketerdiscontinuesitsnailpolishesproductsin2012andisexpectedtodiscontinue
itshandandbodylotionscategoryovertheforecastperiod.
Lack of significant activities, including new product launches and TME support to its
brands, will likely contribute to the discontinuation of the hand and body lotions
categoryinthefuture.
The marketer will continue to promote its products through social media channels to
supportitssalesovertheforecastperiod.
Themarketerplanstoexpanditsecommercefunctionalityovertheforecastperiodin
ordertogainadditionalsalesthroughthisplatform.
Expansion of the ecommerce and retail outlet business is part of Elizabeth Ardens
directtoconsumerbusinessinitiative.
Themarketerisexpectedtofocusontheemergingmarketsovertheforecastperiod.
The marketer plans to open an affiliate office in Brazil in 2013 and increase its
resourcesinmarketsincludingRussia,Europe,andtheMiddleEast.
Sales of Elizabeth Ardens cosmetics and toiletries are projected to reach $312million by
2017,growingataCAGRof1.5%from$290millionin2012.
4A116
ElizabethArden
Table569:ForecastDollarSalesGrowthof
CosmeticsandToiletriesforElizabethArdenby
Category,2012to2017
Category
CAGR,%
Facialtreatments
2.7
Eyemakeup
2.3
COMPANYAVERAGE
1.5
Facemakeup
1.4
Fragrancesforwomen
1.0
Fragrancesformen
0.5
Handandbodylotions
5117
5118
ElizabethArden
4A118
ENERGIZERHOLDINGS
Table570:EnergizerHoldingsSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
SUNCAREPRODUCTS
BananaBoat
2012
168
179
49
51
217
230
Skintimate
83
85
Edge
75
77
Schick
Total
162
166
TOTAL
379
396
HawaiianTropic
Total
SHAVINGPRODUCTS
COMPANYOVERVIEW
Energizer Holdings is a global consumer goods company operating in broad categories of

personalcareandhouseholdproducts.
Thecompanywasincorporatedin1999andisheadquarteredinSt.Louis,MO.
ItistradedontheNewYorkStockExchange.
Thecompanyoperatesin49countriesandhasdistributioninmorethan160countries.
EnergizerHoldingsworldwideemployeestotalabout14,800.
As of September 2012, the company employs more than 4,800 people in the United
Statesandapproximately10,000inforeignjurisdictions.
The company is present internationally in North America, the AsiaPacific region, and
SouthandCentralAmerica.
Itisprimarilyaconsumergoodscompanythatoperatesgloballyinthehouseholdand
personal care productscategories.Personal care productscontribute to 54.3% of the
totalsalesin2012.
5120
EnergizerHoldings
Thecompanyshouseholdproductsofferitsconsumersarangeofportablepowersolutions
undertheEnergizerandEverydaybrandnames.
Energizer Holdings household product portfolio comprises household batteries,
specialtybatteries,andlightingproducts.
ProductsrangefromlowcostcarbonzincbatteriestolithiumAAandAAAbatteries.
Other products include specialty batteries, Energi To Go chargers, and a complete
lineofbatterypoweredflashlightsandlanterns.
The companys personal care division offers its customers a range of products in the wet
shave,skincare,femininecare,andinfantcareproductcategories.
ThewellestablishedbrandnamesincludeSchickandWilkinsonSwordinthemensand
womensshavingproducts.
Tampons, gloves, and infant feeding products are marketed under the Playtex brand
name.
Sun care products are marketed under the wellknown brands, Banana Boat and
HawaiianTropic.
Underthepersonalcareproductsdivision,thecompanyalsomarketsWetOnesmoist
wipes.
Energizerproductsaresoldworldwidethroughretailoutlets.
Massmerchandisers,warehouseclubs,electronicspecialtystores,departmentstores,
hardware and automotive centers, and military stores, as well as food, drug, and
conveniencestores.
The company operates a number of manufacturing and packaging facilities in 14
countriesinfivecontinents.
Energizers products are marketed to its retailer partners primarily through a sales
forceandalsothroughexclusiveandnonexclusivedistributorsandwholesalers.
InNovember2012,the companysboardofdirectorsapprovesamultirestructuringplan.
Thisplanisformulatedtoamelioratecostcompetitivenessandtodeliverincreasedfinancial
returns.However,theplanisexpectedtocutdowntheglobalworkforceby10%.
Energizerlabels2012astheYearofReturnwithprofitgrowthinpersonalcareafterthe
investmentsthecompanyhadformedin2011.
Total corporate sales for the company decrease by 1.7% from $4,645.7 million in 2011 to
Corporatenetprofitsincreaseby56.5%from$261.2millionin2011to$408.9million
in2012.
Since 2007, the companys sales have increased at a compound annual growth rate
(CAGR)of6.3%,whilenetprofitshavegrownataCAGRof4.9%.
4A120
EnergizerHoldings
Table571:EnergizerHoldingsGlobalCorporateSales,2007to2012
$Million
Year
Sales
Netprofits
Marginonsales
Returnonequity
2007
3,365.1
321.4
9.6
49.2
2008
4,331.0
329.3
7.6
33.1
2009
3,999.8
297.8
7.4
16.9
2010
4,248.3
403.0
9.5
19.2
2011
4,645.7
261.2
5.6
12.4
2012
4,567.2
408.9
9.0
19.8
NOTE:FiscalyearendingSeptember30.
Table572:EnergizerHoldingsGlobalSalesbyBusinessSegment,2011to2012
%Ofsales
Segment
2011
2012
BatteriesandLightingProducts
47.3
45.7
RazorsandBlades
35.2
37.0
Skincare,femininecare,andinfantcare
17.5
17.3
100.0
100.0
Total
Table573:EnergizerHoldingsGlobalSalesby
Region,2011and2012
%Oftotal
Region
2011
2012
TheUnitedStates
50.4
51.6
International
49.6
48.4
100.0
100.0
Total
In the cosmetics and toiletries industry, Energizer Holdings competes in two product
categories:suncareproductsandshavingproducts.
SalesofEnergizerHoldingsinthecosmeticsandtoiletriesindustryintheUnitedStates
advanceby4.5%from$379millionin2011to$396millionin2012.
Since2007,salesofEnergizerHoldingshaveincreasedataCAGRof4.8%.
5121
5122
EnergizerHoldings
Table574:EnergizerHoldingsCosmeticsandToiletriesSales,
2007to2012
Year
$Million
Change,%
2007
314
2008
324
3.2
2009
324
2010
354
9.3
2011
379
7.1
2012
396
4.5
ThesuncareproductscategorycontinuestobethelargestproductcategoryforEnergizer
Holdingsin2012.
Manufacturerssalesadvance6%toreach$230millionin2012,upfrom$217millionin
2011.
The marketers share in the entire category declines from 22.1% in 2011 to 21.9% in
2012.
Energizer Holdings marks its presence in the category with two brands: Banana Boat
andHawaiianTropic.
Banana Boat dominates the sun care products category in 2012, with sales at
$179million, up 6.5% from $168million in 2011. Growth for the brand in 2012 is
attributed to its new product introductions, brand loyalty from consumers, and
increasedemphasisonmarketingactivities.
Thebrandmaintainsitsmarketshareinthecategory,accountingfor17.1%ofthetotal
suncareproductscategoryssalesin2012,flatfrom2011levels.
BananaBoatsofferingsincludesunblocks,sunscreens,suntanningproducts,sunless
tanning, and aftersun and other products. However, its dominance is in the rapidly
growingandpopularsunblockssegment.
In 2012, Energizer Holdings introduces Banana Boat Sport Performance Coolzone
UltraMist Continuous Spray Sunscreen SPF 50, Banana Boat Sport Performance
Coolzone UltraMist Continuous Spray Sunscreen SPF 30, Banana Boat Coolzone After
Sun Aloe Gel with Lidocaine, Banana Boat Natural Reflect Sunscreen Lotion SPF 50+,
BananaBoatNaturalReflectKidsSunscreenLotionSPF50+,andBananaBoatNatural
ReflectBabySunscreenLotionSPF50+.
In October 2012, the brand voluntary withdraws 23 of its continuous spray products
whichareidentifiedtobeathreatduetothepotentialriskoftheproductsignitingon
the skin, when in contact with an igniting source, and the product has not dried off
completely.
4A122
EnergizerHoldings
The products withdrawn include Ultra Mist Sport 15 Spray, Ultra Mist Sport SPF 30
Spray, Sport 30 Bonus Continuous Spray, Ultra Mist Ultra Defense SPF 30, Ultra Mist
UltraDefenseSPF30Bonus,FamilySizeSport30UltraMist,UltraMistSportSPF50,
UltraDefenseUltraMistSPF50,UltraDefense50BonusContinuousSpray,UltraMist
KidsSPF50Clear,Sport50BonusContinuousSpray,UltraMistSportPerformanceSPF
50+ Spray, Ultra Mist Ultra Defense 85 Spray, Ultra Mist Sport 85 Spray, Kids SPF 85
Spray,BonusUltraDefenseSPF85UltraMist,BonusSportSPF85UltraMist,SportSPF
30 Spray Twin Pack, Sport SPF 50 Spray Twin Pack, Sport 30 Ultra Mist 2 Pack with
Lotion&Lip,SportSPF30UltraMistw/SportLipBalm,Sport30UltraMist,andSport
SPF50UltraMist3Pack.
The company cites the reason behind the potential risk to be the product delivery
systemorthesizeofthevalve,whichdispensesmorethantheregularsuncaresprays
and therefore takes longer to dry in comparison to other continuous sprays in the
market.
Hawaiian Tropic, the other brand of Energizer Holdings in the sun care products
category,continuestobethefourthleadingmassbrandinthecategory,withsalesat
$51millionin2012.
HawaiianTropicpostsa4.1%growthwithsalesadvancingfrom$49millionin2011to
$51millionin2012.
Hawaiian Tropics growth in 2012 is accredited to the marketers introduction of the
highlyanticipatedSilkHydrationrangeofproductsandincreasedmarketingexposure
withitsfirstproductlinelaunchattheMercedesBenzFashionWeek.
The Silk Hydration line comprises six SKUs: Silk Hydration After Sun Lotion, Silk
Hydration Clear Mist Spray SPF 15, Silk Hydration Clear Mist Spray SPF 30, Silk
Hydration Lotion Sunscreen SPF 12, Silk Hydration Lotion Sunscreen SPF 30, and Silk
Hydration Lotion Sunscreen SPF 50. The variants are enriched with hydrating silk
ribbons.
EnergizerHoldingsisalsotheleadingmarketerintheshavingproductscategorywithsales
at$166millionin2012.Salesadvance2.5%from$162millionin2011.
Themarketersshareintheshavingproductscategorydeclinesfrom44.8%in2011to
44.5%in2012.
EnergizerHoldingshasapresenceinthecategorywithitsSkintimate,Edge,andSchick
brands.
Skintimate, the flagship brand of Energizer Holdings, leads the category with sales at
$85millionin2012,up2.4%from$83millionin2011.Thebrandrepresents22.8%of
Skintimate, a femalecentric brand, continues to grow as the future prospect for
shaving products for women brightens. The brand is also the largest female shaving
brandinthecategory.
In 2012, Skintimates Lotionized Shave Crme undergoes a packaging makeover. The
new colorful packaging provides a feminine look. The moisturizing shaving cream is
enrichedwitholivebutter,soy,vitaminE,andaloevera.SkintimatesLotionizedShave
Crmeisavailableinthreevariants:SensitiveSkinFormula,DrySkinFormula,andBaby
SoftFormula.
Edgeisthesecondleadingbrandforthemarketerin2012withsalesat$77million,up
2.7%from$75millionin2011.AlthoughthesalesforEdgeincreasein2012itssharein
theshavingproductsmarketdeclinesslightlyfrom20.7%in2011to20.6%in2012.
5123
5124
EnergizerHoldings
RECENTDEVELOPMENTS
Acquisitionsanddivestitures
Therearenomajormergersoracquisitionsin2012.
Managementchanges
Therearenomajorchangesinthetopmanagementofthecompanyduring2012.
Newproducts
Table575:SelectNewProductsIntroducedbyEnergizerHoldingsintheUnitedStatesin2012
Brand
Category
Description
Suncare
products
SportPerformanceCoolzoneUltraMistContinuousSpraySunscreen
providesbroadspectrumUVAandUVprotectionandwaterresistancefor
upto80minutes.ItisrecommendedbyTheSkinCancerFoundationand
isavailableinSPF30andSPF50variants.Thisproductisnotrecalledin
2012
BananaBoat
Suncare
products
NaturalReflectSunscreenLotionSPF50+isformulatedwithnaturally
sourcedmineralsuncreeenactivesandzincoxideforUVAandUVB
protection.Itisoxybenzoneandparabenfree,gentleonsensitiveskin,
dermartologisttested,hasbeenproveneffectiveagainstsunburn,water
resistantforupto80minutes,andisrecommendedbyTheSkinCancer
Foundation.Comesinvariantsforadults,babies,andkids
HawaiianTropic
Suncare
products
SilkHydrationClearMistSprayoffersbroadspectrumUVAandUVB
protectionaccompaniedby12hoursofmoisturization.Itisformulated
withskinnourishingantioxidants,andisrecommendedbytheSkinCancer
Foundation.ItisavailableinSPF15andSPF30variants
HawaiianTropic
Suncare
products
SilkHydrationLotionSunscreenprovidesUVAandUVBprotectionand12
hourmoisturization.Itisformulatedwithhydratingsilkribbonsfora
continuousinsunmoisture,nourishingantioxidants,exoticbotanicals
andatropicalfragrance;andisavailableinSPF12,SPF30,andSPF50
variants
Schick
Shaving
products
HydroSkinProtectShaveGelenrichedwithingredientsincludingvitamin
Eandaloe,helpsprotecttheskin
BananaBoat
MARKETINGACTIVITY
Energizer Holdings total traceable media expenditures (TMEs) decline 10.1% in 2012 to
$33.0million,downfrom$36.7million.
The company utilizes an array of marketing media such as sampling, couponing, and
advertisementsinmagazinesandontelevision.
4A124
EnergizerHoldings
Inthesuncareproductscategory,EnergizerHoldingsTMEtotals$19.5millionin2012.
ThemarketerincreasesitsTMEby8.3%from$18millionin2011.
MagazineadvertisementsreceivethemaximumTMEfromthecompanyat$9.7million
in2012.Thisaccountsfor49.7%ofthecompanystotalTMEinthecategory.
Television advertisements follow, accounting for 34.0% of the companys total TME,
withexpenditureamountingto$6.6millionin2012.
In 2012, the company allocates $13.4 million to promote its Banana Boat brand.
Banana Boat Coolzone spray receives the highest advertising expenditures, at $6.7
million.
Thecompanysotherbrand,HawaiianTropic,isallocatedaTMEof$6.1millionin2012
withmostor$5.9millionbeingallocatedtopromotetheSilkHydrationproductline.
Intheshavingproductscategory,EnergizerHoldingsTMEfor2012is$12.5million,down
Themarketerspends$8.1millionontelevisionadvertisementsin2012.
Print advertisements account for $2.3million of the companys TME in support of its
brands.
Edgealonegarners$9.5millionor76%ofthemarketersTMEin2012.
SkintimatereceivesaTMEof$2.9millionin2012.
Afewleadingmarketers,suchasEnergizerHoldings,Merck,andJohnson&Johnson,adopt
marketing techniques, such as special offers including giveaways, sweepstakes, and
discountcoupons.
BananaBoats101DaysofSummerinitiativeisdesignedtogetfamiliesoutdoorsto
play.EachtimeaparenttakestheBananaBoatFacebookpledgetoplaywiththeirkids
outdoors,thecompanydonatesabottleofsunscreen(upto10,000bottles)totheHole
intheWallGang,acampfoundedbyPaulNewmanforchildrencopingwithcancerand
seriousillnesses.
In2012,EdgeutilizesitsFacebook pagetopromoteitsproductsthrougha varietyof
sweepstakes including the Edge Endowment Sweeps where participants get a chance
to win $10,000 daily, over 250 weekly cash prizes, and the Team Edge Sweepstakes
whichrequiresparticipantstovotefortheUFCrisingstarinordertowinatripfortwo
toLasVegastoseealiveUFCevent.
Themarketercontinuestoutilizesocialmediaactivationefforts,tospreadawarenessabout
itsbrandsandnewproductintroductions.
In2012,HawaiianTropicactivatestheMercedesBenzFashionWeekSwimthrough,a
Facebookpromotionthatallowsparticipantstowinatriptotheevent.
Banana Boat promotes the Chip Ganassi Racing with a branded Facebook tab that
offers tips on music and outdoor gear from Dario Franchitti and Jamie McMurray in
2012.
Additionally, in 2012, the marketer introduces special edition Team Edge cans
containingtheUFCfightersfacesetchedonthepackaging,whichitpromotesthrough
theFacebookpageofitsEdgebrand.
5125
5126
EnergizerHoldings
EnergizerHoldingsorganizeseventstobringaboutawarenessabouttheharmfuleffectsof
theskinsexposuretothesun.
In 2012, Hawaiian Tropic sponsors the Mercedes Benz Fashion Week Swim 2013
Collectionsrunwaytopromoteitslatestrangeofsuncareproducts,theSilkHydration
line.
In2012,BananaBoatcollaborateswithChipGanassiRacingTeamsforthe2012IZOD
IndyCar Series racing season. According to the partnership twotime Indianapolis 500
winnerDarioFranchittidrivesaBananaBoatbrandthemedcarintheseasonopening
GrandPrixofSt.Petersburg.FranchittiadornstheBananaBoatbrandlogoonhisfire
suitthroughoutthe2012season.Thebrandalsohostsaneventtracksidewherebyfans
can come to the Banana Boat CoolZone Sunscreen Pit Stop and use new sunscreens,
playgames,andreceiveproductsasgiveaways.
OUTLOOK
EnergizerHoldingsisexpectedtopostahealthygrowthof4.2%duringtheforecastperiod,
ending2017.
Themarketerisexpectedtosupportitsbrandswithanincreasedadvertisingspendand
promotionalsupport.
Thecompanyislikelytostrengthenitspresenceinthecosmeticsandtoiletriesmarket
withmergersandacquisitionsduringtheforecastperiod.
The sun care products category will continue to be the key driver for the companys
growthduringtheforecastperiod,2012to2017.
Intheshavingproductscategory,themarketerstwobrands,SkintimateandEdge,will
continuetoshowgrowthoverthenextfiveyears.
Inthesuncareproductscategory,themarketerisexpectedtomaintainitsleadingposition
withitstwobrandsBananaBoatandHawaiianTropic,duringtheforecastperiod2012to
2017.
Energizer Holdings will continue to introduce new and innovative sun care products
andbringabouttechnologicaladvancementstoitsproductsunderitsBananaBoatand
HawaiianTropicbrands.
The introduction of the Food and Drug Administrations (FDAs) longawaited sunscreen
monographwillinducenewinterestduringtheforecastperiodthrough2017.
Newregulationsonproductlabelingandformulationshavebeenforcedintoeffectin
December2012,andarelikelytoleadtoeffectivechangesduringthecomingyears.
TheFDAisexpectedtocomeupwithadecisionfortheproposedruleoflimitingthe
SPFto50,therebychangingthewayconsumersperceivehigherSPFproducts,andalso
alteringtheproductofferingsofEnergizerHoldingsbrandsinthecategory.Thiswould
require the marketer to reformulate some of its product offerings to bring down the
leveloftheirSPFclaims.
4A126
EnergizerHoldings
Energizer Holdings brands in the shaving products category are likely to show moderate
growthovertheforecastperiod,althoughlowerthanthecompanysaverage.
The marketer is likely to introduce shaving products enriched with commonly used
naturalingredients,suchasaloe,vitaminAandE,sheabutter,cocoabutter,milk,and
honey.
The company is expected to undertake efforts to differentiate its brands from the
othersavailableinthemarket.
The company will continue to support its brands with good TME during the forecast
periodending2017.
SalesofEnergizerHoldingsareprojectedtoreach$487millionby2017,up4.2%annually
ToiletriesforEnergizerHoldingsbyCategory,2012to2017
Category
CAGR,%
Suncareproducts
5.6
COMPANYAVERAGE
4.2
Shavingproducts
2.2
5127
5128
EnergizerHoldings
4A128
ESTELAUDER
Table577:EsteLaudersSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
2012
Clinique
438
458
EsteLauder
291
322
LaMer
75
94
Origins
42
50
Aveda
35
36
BobbiBrown
29
32
MAC
19
22
BeautyBank
Prescriptives
939
1,023
Clinique
185
196
MAC
158
173
EsteLauder
113
115
BobbiBrown
40
44
Origins
17
18
SmashboxBeauty
11
12
Aveda
Totalr
531
565
MAC
134
140
Clinique
100
105
EsteLauder
48
49
BobbiBrown
29
30
SmashboxBeauty
18
19
FACIALTREATMENTS
Total
FACEMAKEUP
EYEMAKEUP
(Continued)
5130
Este Lauder
$Million
Category/brand
2011
EYEMAKEUP(Continued)
2012
Origins
Aveda
Totalr
339
354
Beautiful
37
37
CashmereMist
25
26
Pleasures
20
23
Happy
18
18
CoachPoppy
18
13
AromaticsElixir
11
11
SensuousNude
10
11
10
BeDelicious
CoachPoppyFlower
JoMalone
WhiteLinen
CoachSignature
Knowing
HappyHeart
MichaelbyMichaelKors
Este
Pure
BeautifulLove
BeyondParadise
PleasuresDelight
PleasuresExotic
PureWhiteLinen
TommyGirl
UnforgivableWoman
VeryHollywoodMichaelKorsr
BeautifulSheer
FRAGRANCESFORWOMEN
YouthDew
Sensuous
(Continued)
4A130
Este Lauder
$Million
Category/brand
2011
2012
Calyx
Cinnabar
Intuition
OriginsGingerEssence
PleasuresIntense
RedDeliciousWomen
Spellbound
TuscanyperDonna
244
238
MAC
80
88
Clinique
43
47
BobbiBrown
30
32
EsteLauder
28
29
Origins
13
14
SmashboxBeauty
10
11
Aveda
Totalr
209
226
Aveda
37
37
Bumbleandbumble
27
28
Total
64
65
Aveda
33
34
Bumbleandbumble
17
18
54
56
Aveda
32
33
Bumbleandbumble
13
14
47
49
Total
SHAMPOOS
Origins
Total
CONDITIONERS
Origins
Total
(Continued)
5131
5132
Este Lauder
$Million
Category/brand
2011
2012
CliniqueSkinSuppliesforMen
18
19
LabSeriesSkincareforMen
10
11
32
34
Clinique
12
12
Origins
EsteLauder
28
29
Origins
Total
SUNCAREPRODUCTS
Total
HANDANDBODYLOTIONS
Origins
10
10
Clinique
Aveda
EsteLauder
26
26
Aramis
Coach
PleasuresforMen
HappyforMen
TomFordForMen
TomFordNoir
Tommy
IamKinga
Mustanga
Allother
29
24
NAILPOLISHES
EsteLauder
Clinique
MAC
Total
13
Total
FRAGRANCESFORMEN
Total
(Continued)
4A132
Este Lauder
$Million
Category/brand
2011
2012
Clinique
MAC
EsteLauder
Total
CliniqueSuppliesforMen
LabSeriesSkincareforMen
Origins
Total
2,569
2,722
Origins
SHAVINGPRODUCTS
TOTALr
aDiscontinued.
rRestated.
COMPANYOVERVIEW
TheEsteLauderCompaniesisoneoftheworldsleadingmanufacturersandmarketersof
luxuryskincare,makeup,fragrance,haircare,andpersonalcareproducts.
Este Lauder was founded in 1946 by Mrs. Este Lauder. The flagship brand, Este
Lauder,waslaunchedwithfourproducts:SuperRichAllPurposeCreme,CremePack,
CleansingOil,andSkinLotion.
The company is listed on the New York Stock Exchange under the ticker symbol, EL.
Eventhoughitwentpublicin1995,themajorityofthecompanysstocksarestillheld
bythemembersoftheLauderfamily.
Its headquarters is located in New York, NY. Este Lauder has business activities
operational in 43 countries and territories. As of June, 2012, the company employs
38,500fulltimeemployeesglobally.
The company has approximately 12 manufacturing units in five countries: the United
States,Belgium,Switzerland,theUnitedKingdom,andCanada.
As of June 2012, Este Lauders research & development division employs
approximately500employeesacrossfiveprincipalfacilities:Melville,NY;Blaine,MN;
Oevel,Belgium;Ontario,Canada;andShanghai,China.
5133
5134
Este Lauder
Thecompanyoffersawiderangeofbrands,whichareorganizedintofourclustersbasedon
thedistributionchannelandconsumersegmentation.
Highendprestigebrandsandmakeupartistbrands:EsteLauder,MAC,BobbiBrown,
Prescriptives,LaMer,JoMalone,andTomFordBeauty.
Prestigeskincareandalternativechannels:Clinique,Origins,andOjon.
Fragrance licensing and creative incubator: Aramis and Designer Fragrances, and
BeautyBank.
Salonandpharmacychannel:Aveda,Bumbleandbumble,andDarphin.
Thecompanyhasanumberoflicenseagreementsforfragranceandbeautyproductswith
celebritiesinthefashionworld,includingKiton,TommyHilfiger,DonnaKaran,MichaelKors,
SeanJohn,Missoni,andTomFord.
EsteLaudersellsitsproductsinmorethan150countriesthroughdepartmentstores,
perfumeries, pharmacies, retail stores, travel retail outlets, prestige hair salons and
spas, freestanding company stores, specialty stores, directresponse television, stores
oncruiseships,inflight,dutyfreeshopsinairportsandcities,andtheInternet.
Corporate sales for Este Lauder grow 10.3% to $9,713.6million in 2012 from
Netprofitsincreaseby22.3%from$700.8millionin2011to$856.9millionin2012.
Netsalesofthecompanyincreaseatacompoundannualgrowthrate(CAGR)of6.7%
since2007.
Table578:EsteLaudersGlobalCorporateSales,2007to2012
$Million
Fiscalyeara
Sales
Netprofits
Marginonsales
Returnonequity
2007
7,038.0
449.0
6.4
37.4
2008
7,910.8
473.8
6.0
28.7
2009
7,323.8
218.4
3.0
5.8
2010
7,795.8
478.3
6.1
19.0
2011
8,810.0
700.8
8.0
26.6
2012
9,713.6
856.9
8.8
31.4
NOTE:ThecompanysfiscalyearendsJune30.
The Americas region accounts for 42.2% of the companyssales in 2012, a decline in the
totalsharefrom43.1%in2011.
4A134
Este Lauder
Table579:EsteLaudersGlobalSalesbyRegion,2011and2012
Region
TheAmericas
Europe,theMiddleEast,
andAfrica
AsiaPacific
Returnsassociatedwith
restructuringactivities
Total
$Million
2011
2012
3,796.3
4,101.1
%Oftotal
2011
2012
43.1
42.2
3,257.6
3,603.2
37.0
37.1
10.6
1,760.7
2,011.4
20.0
20.7
14.2
(4.6)
(2.1)
(0.1)
(54.3)
8,810.0
9,713.6
100.0
100.0
10.3
Change,%
8.0
The skin care product class is the leading product class and commands 43.5% of the
companysglobalcorporatesalesin2012,upfrom42.2%sharein2011.
Table580:EsteLaudersGlobalSalesbyProductClass,2011and2012
$Million
Productcategory
%Oftotal
2011
2012
2011
2012
Change,%
Skincare
3,718.6
4,225.2
42.2
43.5
13.6
Makeup
3,370.8
3,696.8
38.3
38.1
9.7
Fragrance
1,236.0
1,271.0
14.0
13.1
2.8
Haircare
432.3
462.4
4.9
4.8
7.0
Allother
56.9
60.3
0.6
0.6
6.0
Returnsassociatedwith
restructuringactivities
(4.6)
(2.1)
(0.1)
(54.3)
8,810.0
9,713.6
100.0
Total
100.0
10.3
North American department stores, in conjunction with international department stores,

are the biggest retail channel for Este Lauder in 2012, accounting for 54.0% of the
companyssales.
Table581:EsteLaudersGlobalSalesbyDistributionChannel,2012
Distributionchannel
%Ofsales
Internationaldepartmentstores
27
NorthAmericandepartmentstores
27
Perfumeries
13
Travelretail
11
Retailstores
10
Salonsandspas
Allother
Total
100
5135
5136
Este Lauder
Thecompanyscosmeticsandtoiletriessalesincreaseby6.0%from$2,569millionin2011
SaleshavegrownataCAGRof1.5%since2007.
Table582:EsteLaudersCosmeticsandToiletriesSales,
2007to2012
Year
$Millionr
Change,%
2007
2,526
2008
2,450
(3.0)
2009
2,332
(4.8)
2010
2,399
2.9
2011
2,569
7.1
2012
2,722
6.0
rRestated.
EsteLauderleadsthefacialtreatmentsproductscategorywitha15.4%marketshare.
ItdominatestheluxurysegmentwithitsCliniqueandEsteLauderbrands.
Thecompanyssalesinthecategorygrow8.9%during2012,approximatelytwicethe
EsteLaudersCliniquecontinuestobethelargestluxurybrand,withnearly22%share
ofthetotalluxuryfacialtreatmentsales.
Salesofthebrandatthemanufacturerslevelgrowby4.6%from$438millionin2011
WhileCliniqueiscertainlythecategorysluxuryleader,sevenpercentagepointsahead
ofitsclosestcompetitor,andcontinuestogrowsalesatahealthyrate,thebrandloses
somemarketshareduringtheyearasotherbrandscatchupbyintroducingproducts
similar to those previously introduced by Clinique, such as BB Creams and dark spot
correctors.
The Even Better line is expanded with a Dark Circle Corrector for the eyes and the
MoistureSurgelinelaunchesanIntenseSkinFortifyingHydrator.
Este Lauders flagship brand Este Lauder is the secondlargest brand in the luxury
segmentwith$322millioninsalesin2012,up10.7%from$291millionin2011.
Severalnewproductsarelaunchedduringtheyear,whichareallextensionsofexisting
lines.
DayWearisextendedwiththelaunchofaBBCrme.
TimeZoneisextendedwithAdvancedTimeZoneAgeReversingWrinkleCrmewhich
thecompanyclaimscanrewindthevisiblesignsofaginginfivedays.
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Este Lauder
The Perfectionist line is extended with Perfectionist [CP&R] Wrinkle Lifting/Firming

Serumwhichclaimstocorrect,prevent,andrepairskinbycreatingavirtualforcefield
againstlinesandwrinklesbyacceleratingnaturalcollagenbuildingpower.
TheReNutrivlineisextendedwithtwosetsofproductduos:ReCreationFaceCrme
and Night Serum, and Eye Balm and Night Serum for Eyes. Both of these products
contain Glacial BioExtract, a new ingredient from the water beneath the Antarctic
glaciers.
Traceable media expenditures (TMEs) for Este Lauder facial treatments are
$47.7millionin2012,upfrom$44.5millionin2011.
EsteLauderasacompanymovesdowntosecondpositioninthefacemakeupcategoryin
2012eventhoughthecompanyincreasesitscategorysharefrom18.7%in2011to19.2%in
2012.
SalesofEsteLaudertotal$558millionin2012,up6.5%from$524millionin2011.
TheEsteLauderCompaniesInc.increasesitsadvertisingexpensesto$53.7millionin
2012, up from $34.1million in 2011. Close to 95% of advertising dollars is used to
support its Clinique and Este Lauder brands. Products specifically supported include
CliniquesEvenBetterandStayMatteOilFreefoundationandEsteLaudersDouble
WearandInvisiblefoundationlines.Lessthan1%ofadvertisingexpenditureisusedto
supporttheAerinline,whichincludesblushandlipstick.
Withtheexceptionofthenamesakebrand,EsteLauder,thecompanysluxurybrands
outperformthemarket.Productlaunchesforthebrandin2012arenotenoughtofuel
brandsalesbeyondthe1.8%growth.
The companys two leading brandsMAC and Cliniqueaccount for 65.3% of Este
Lauderstotalfacemakeupsalesin2012.
Thetopperformingbrandsinthecompanysportfolioin2012includeMAC,up9.5%;
Bobbi Brown, up 10.0%; and Smashbox Beauty, up 9.1%. Advertising supports Bobbi
BrownsfoundationandconcealerkitandSmashboxsCameraReadyFoundationand
PhotoFinishFoundationPrimer.
Thenamesakebrand,EsteLauder,hasaninnovativemarketingcampaigncobranding
with the television show, Madmen, to promote a collection including limited edition
lipstickandcrmerouge.Thebrandsupportsthecollectionwithhalfmilliondollarsin
advertising.
In 2012, sales for Aveda and BeautyBank brands remain flat. BeautyBank, sold
exclusively at Kohls, with brands including Flirt and American Beauty, faces
competitionfromnewbrand,VeraWang,thatentersKohlsin2012,andElle,whichis
alsosoldatKohls.
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Este Lauder
In the eye makeup category, the companys third largest, sales of Este Lauder grow by
EsteLauderisthesecondleadingmarketerintheeyemakeupcategory,with13.1%of
salesin2012.
MACandCliniqueareEsteLaudersleadingbrands,withsalesat$140million,up4.5%
and$105million,up5.0%,respectively,in2012.
MACandCliniquecollectivelyrepresent63%ofEsteLauderstotaleyemakeupsales
in2012.
MACsgrowthisrecognizedbythesuccessofseveralnewproductsacrossthecategory
includingFalseLashesmascara,PaintPots,EyeBrows,aswellasseveraleyeliners.
Cliniques growth comes from its new Chubby Stick Shadow Tint, the existing Lid
SmoothieAntioxidant8HourEyeColor,aswellasthenewHighImpactmascara.
TheEsteLauderbrandgrowsonly2.1%in2012toreach$49millioninsales.Growthis
attributed partly to its newest mascaras Sumptuous Extreme Waterproof and
SumptuousTwoToneEyeOpeningmascara,andthelaunchofPureColorPaintPots.
EsteLaudersTMEfor2012is$12.7million,upfrom$3.7millionin2011.
Inwomensfragrance,EsteLauderremainsinthirdplaceofcompanyranking,byhaving
threeofthetop11luxuryfragrances.
Thecompanyhasan8.8%categoryshare,downfrom9.3%in2011,assalesdip2.5%
duringtheyear.
Beautifulssalesareflatfrom2011,whileCashmereMistandPleasureshaveincreasing
sales.Thesethreearethecompanyslargestfragrancesbrands.
Asidefrom scentsunderthemajor beautybrandssuchas EsteLauderandClinique,
the company works to put together a strong portfolio of designer brands including
Donna Karan, Coach, Michael Kors, Tommy Hilfiger, and more recently Ermenegildo
Zegna,ToryBurch,andMarni.ThecompanyacquiredthefragrancefranchisesforZegna,
Burch,andMarniinlate2011,andishandledbytheAramisandDesignerFragrances
divisionofEsteLauder.
TheDonnaKaranfranchiseisextendedin2012withthefalllaunchofWoman.
InitialscentsfromZegnaandMarni,launchinearly2013,andanewCoachscentcalled
LovelaunchesintimeforValentinesDay.
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Este Lauder
Este Lauder Companies is the secondleading marketer in the lipsticks and lip glosses
category,withsalesat$226million,increasing8.1%from$209millionin2011.
EsteLauder,asacompany,holdsacategoryshareof16.4%in2012,upfrom15.5%in
2011.
AllEsteLaudersbrandsgrowin2012.
The companys leading brand, MAC, contributes the most dollars, up 10.0% to reach
$88 million in 2012. MAC launches several new products in this category. Its original
lipstickprovidesadditionaldollarstothebrandssales.
MACallocatesmostofitsadvertisingbudgetof$3.7million,whichisup20%from2011,
to promote its lipsticks and nail polishes using multiplepage print advertisements.
MAC receives editorial pieces for its Marilyn Monroe collection of 29 items including
lipstick.
Clinique is the secondleading brand for the company in the luxury trade class with
salesat$47millionin2012,up9%from$43millionin2011.
TheCliniquebrandissupportedwithcloseto$24millioninTMEin2012.Over90%of
theTMEisusedtopromoteitsChubbyStickproduct.
TheBobbiBrownbrandisup6.7%in2012,reaching$32millioninsales,mainlydueto
shadeextensionsacrossalllipproductsandincreasedadvertising.Thebrandsignson
actressKatieHolmesasitsfirstcelebrityspokesperson.However,salesdeclinefromits
doubledigitgrowthin2011.
Origins is up 7.7%, totaling $14million in 2012 from $13million in 2011. The brand
capitalizes on trends with a variety of lip products in formats that consumers desire,
suchasliquid,chubbypencils,andanourishinglipstickwithitsFlowerFusionproduct.
Este Lauder decreases advertising for its namesake brand in 2012, and uses that
allocatedtopromoteitsPureColorlipstick.
SalesofEsteLauderinthehaircareproductclassgrow3.0%from$165millionin2011to
$170millionin2012.
Hairstylingproductsandspraysisthelargesthaircarecategoryforthemarketerinthe
productclasswithasalesgainof1.6%toreach$65millionin2012,upfrom$64million
in2011.
The company is represented in the hair styling products and sprays category with its
AvedaandBumbleandBumblebrands.
Shampoosisthesecondlargesthaircarecategoryforthemarketerwithsalesin2012
at$56million,up3.7%from$54millionin2011.
The marketers performance in the conditioners category grows 4.3% to reach
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Este Lauder
RECENTDEVELOPMENTS
Mergersandacquisitions
Therearenomergersandacquisitionsin2012.
Managementchanges
Thefiscalyear2012seesimportantchangeswithexpansionofrolesofexecutiveswithin
themanagement.
TraceyT.TravisisappointedasExecutiveVicepresidentandChiefFinancialOfficerof
TheEsteLauderCompanies.Travisassumesherpositionfromthe20thAugust,2012
replacingRichardW.Kunes.
Richard W. Kunes is appointed as the Executive Vice President and Senior Advisor to
theChiefExecutiveOfficer.
Thia Breen and Lynne Greene are appointed as Group President at Este Lauder
Companies,effectiveJanuary1,2013.LynneGreene,PresidentoftheCliniquebrand,
takesontheroleastheGroupPresidentofClinique,Origins,Ojon,Aveda,andDarphin.
Thia Breen, who is currently President of North America, will add Canada to her
responsibilities.
JaneLauder,theglobalpresidentandgeneralmanageroftheOriginsandOjonbrands,
nowaddsthebrandDarphintoherrelationshipresponsibilities.
PeterLichtenthal,PresidentofBumbleandBumble,willalsooverseeSmashbox.
John Dempsey, Group President of Este Lauder, will add Bumble and bumble to his
responsibilitiesfromJanuary1,2013.
JamesGagerisappointedSeniorVicePresident,GroupCreativeDirectortooverseeall
thecreativeactivityofMACCosmetics,LaMer,andJoMalone.
Otherdevelopments
EsteLaudersMACCosmeticswinsa$90millionjudgmentagainstChinesecybersquatters
sellingcounterfeitMACbeautyproducts.ThelawsuitwasfiledagainstTingtingChen,Limei
Weng, and Zhang Guithe, and others who operated 112 web sites including,
themaccosmetics.com,
mac2wholesale.com,
maccosmeticworld.com,
wholesalemacmakeup.com,andcheapmakeuppick.com.
ThejudgeorderedthatanyfundsinthePaypalaccountattachedtotheinfringingsites
tobegiventoEsteLauder.Additionally,thirdpartyproviders,suchasonlinebusiness
tobusiness selling platforms, backend service providers, search engines, web
designers,Internetserviceproviders,domainnameregistrars,andshippers,tostopall
servicestotheChinesecybersquatters.
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Este Lauder
In 2012, Este Lauder enters into a license agreement with American luxury sportswear
brandTonyBurch,andMilanbasedfashioncompanyMarni.
TheseadditionswillstrengthenthemarketersAramisandDesignerFragrances(ADF)
portfolioofbrands.ThelicensingagreementgivesEsteLauderexclusiveglobalrights
to market fragrances under the Ermenegildo Zegna Group, as well as develop new
productlinesinthegroomingsegment.
NOTABLENEWPRODUCTS
Table583:SelectNewProductsIntroducedbyEsteLauderintheUnitedStatesin2012
Brand
Category
Description
BobbiBrown
Eyemakeup
LimitedEditionEyeShadowPaletteCollections
BobbiBrown
Facemakeup
LongWearEvenFinishCompactFoundation
BobbiBrown
Facemakeup
SkinFoundationMineralMakeupSPF15.Claimstoprovidenatural
finishwithaweightlessfeelandnaturalfinish
BobbiBrown
Facialtreatments
BBCreamcombinesmoisturizer,treatment,SPF,andlightmakeupin
oneproduct
BobbiBrown
RichLipColorSPF12,reformulatedandlightweight,combines
pigmentswithaclearbasetodeliverpurecolor
BobbiBrown
HighShimmerLipGlosswithlightcatchingshimmerandlasting,non
stickyshine,madewithfinepearlsandclearpigments
Bumbleandbumble
Conditioners
ColorMindedconditionerisinfusedwithdualpolymertechnology
thatisdesignedtomakehairimpermeabletowater,reducingboth
colorwashoutandfading
Clinique
Eyemakeup
LidSmoothieAntioxidant8HourEyeColor,acreamy,crease
resistanteyecolorin12shades.Featuresametalapplicatorthat
feelscoolontheeyelid.Containsantioxidantsthataresaidtohelp
protecttheskinaroundtheeyearea
Clinique
Eyemakeup
BottomLashMascarawithaspecialbrushfortinytasksanda
formulathatpreventssmears.Canbeusedwithanymascaraontop
lashes
Clinique
Facemakeup
RepairwearLaserFocusAllSmoothMakeupSPF15.Anupdated
formulathatissheerandcontainsRepairwearLaserFocusserum.
Theliquidfoundationisavailablein12shades
Facialtreatments
EvenBetterEyesDarkCircleCorrectorisalightweight,oilfree
hydratingeyeserumclaimedtobeclinicallyproventovisiblylighten
darkcirclesby30%in12weeks.Skinstrengtheningingredientsmake
skinlesstransparent.Coolingmassagetipbreaksuppuffs.Sheer
opticsinstantlybrightensallskintypes,fromfairtodeep
Facialtreatments
CliniqueMoistureSurgeIntenseSkinFortifyingHydratorlaunchedin
late2011,isanoilfree,creamgelhydratorthatkeepsskinplumped
for24hours.Alsohelpstofortifyandrepairskinsmoisturebarrier
withcontinuoususe.AgeDefenseBBCreamSPFisamultifunctional
beautyproductthatprovidesskinprotectionandhelpsbanish
imperfections
Clinique
Clinique
(Continued)
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Este Lauder
Brand
Category
Description
Clinique
Eyemakeup
ChubbyStickShadowTint
Clinique
Facemakeup
PoreRefiningSolutionsInstantPerfectingMakeup
Clinique
Facialtreatments
EvenBetterEyesDarkCircleCorrectorisalightweight,oilfree
hydratingeyeserumclaimedtobeclinicallyproventovisiblylighten
darkcirclesby30%in12weeks.Skinstrengtheningingredientsmake
skinlesstransparent.Coolingmassagetipbreaksuppuffs.Sheer
opticsinstantlybrightensallskintypes,fromfairtodeep
Clinique
Facialtreatments
MoistureSurgeIntenseSkinFortifyingHydratorisacreamgelthat
providesmaximumhydrationplusabarriertostrengthenandrepair
theskin
Clinique
ChubbyStickMoisturizingLipColorBalm
CliniqueSkinSupplies
forMen
Skincareproductsfor
men
DarkSpotCorrectorisaserumformensskinthathelpsreducethe
appearanceofdarkspots,acnescars,andsunspotsonallkindsof
skintypesandtones.Helpsreduceingrownhairandresultsstart
becomingvisibleinaslessasfourweeks
DonnaKaren
Fragrancesforwomen
Womanhastopnotesofsandalwoodandorangeblossom
EsteLauder
Eyemakeup
PureColorStayOnShadowPaint
EsteLauder
Facemakeup
DoubleWearStayInPlacePowder
EsteLauder
Facemakeup
DoubleWearStayInPlaceConcealerSPF10
EsteLauder
Facemakeup
PureColorSensuousRouge
EsteLauder
Facialtreatments
AdvancedNightRepairlineisextendedwithaneyeserumtosmooth
puffinessandfirmtheeyearea
EsteLauder
Facialtreatments
AdvancedTimeZoneAgeReversingLine/WrinkleCrmeclaimsto
helprewindthevisiblesignsofaginginjustfivedays
EsteLauder
Facialtreatments
DayWearBBCrmefightsagainstenvironmentalhazardswhile
protectingtheskin
EsteLauder
Facialtreatments
Perfectionist[CP+R]WrinkleLifting/FirmingSerumclaimstocorrect,
prevent,andrepairskinbycreatingavirtual"forcefield"against
linesandwrinklesbysuperchargingnaturalcollagenbuildingpower
EsteLauder
Facialtreatments
ReNutrivlineisextendedwithtwosetsofproductduos:ReCreation
FaceCrmeandNightSerum,andEyeBalmandNightSerumfor
Eyes.Thesehighendproductsaresuperchargedwithanew
ingredientsourcedfromdeepwaterbeneathAntarcticglacierscalled
GlacialBioExtract
EsteLauder
PureColorLipstick
EsteLauder
Nailpolishes
PureColorVividShinenailpolish
LabSeriesSkincare
ForMen
Skincareproductsfor
men
MAXLSDailyRenewingCleanserisaMoleculeAgeLessComplexthat
combineswiththeoxygenationactionwashingawayimpurities
withoutaffectingtheskinsnaturalPHbalance
LabSeriesSkincare
ForMen
Skincareproductsfor
men
MAXLSSkinRechargingWaterLotionisaweightlesshydratinglotion
thatisformulatedwithMoleculeAgeLessComplexcomprising
Aquatrontechnologytoremoveold,dead,anddullskinwithout
affectingtheskinsnaturalPHbalance
(Continued)
4A142
Este Lauder
Brand
Category
Description
LabSeriesSkincare
ForMen
Skincareproductsfor
men
MAXLSLightMoistureLotion,formulatedwithSirtuintechnology
andMolecularAgeLessComplex,isalightweightdailymoisturizing
treatmentthatpreventsandrepairssignsofaging
LabSeriesSkincare
ForMen
Skincareproductsfor
men
InstantSkinBoosterisformulatedwithFirmaboostComplexto
tightenanduplifttheskinontheoutsideandstrengthentheskins
naturalcollageninternally
MAC
Eyemakeup
FalseLashesmascara
MAC
Facemakeup
MineralizeBlush&Highlighter
MAC
Facemakeup
MatchmasterFoundationSPF15
MAC
ProLongwearLipPencil
Origins
Facialtreatments
MegabrightSkinToneCorrectingSerumclaimstobeclinically
proventohelpreducetheappearanceofdarkspotsinfourweeks
whileinstantlyleavingskinbrighterandmoreradiant
Origins
Facialtreatments
MakeaDifferencePlusRejuvenatingMoisturizerisarejuvenating
moisturizerfortifiedwithRoseofJerichoplusabreakthroughLychee
andWatermelonhydrasustaincomplexwhichquenchesdeepto
helprepairthenaturalmoisturedeficiencyindry,dehydratedskin.
Clinicallyproventoinstantlyboostskin'smoisturereservoirtokeepit
hydratedandrejuvenatedallday
Origins
Shavingproducts
BladeRunnerisenrichedwithkukuinutoil,soyabeanoil,andother
plantprotectors.Itsfragranceisablendofcoriander,Australian
eucalyptus,Frenchpeppermint,andothernaturalrevivers
Origins
Skincareproductsfor
men
SaveTheMalesisamultibenefitoilfreelotionthatkeepstheskin
healthyandhydrated.Itisenrichedwithnaturalingredientssuchas
carrotprotein,Chinesewolfberry,mangosteenextract,andwhite
birch
Smashbox
Eyemakeup
PhotoOpEyeEnhancingPaletteforblue,brown,andhazeleyes
SmashboxCosmetics
Facialtreatments
CameraReadyBBcreamcontainsanoilcontrolformulationwith
emollientsandopticalpearlpigmentstoprovidehydrationand
reducefinelinesandwrinklesafteronlyfourweeks.Containssun
protectionandcomesinmultipleshades
SmashboxCosmetics
BeLegendaryLipstick
TomFord
Fragrancesformen
TomFordNoirhastopnotesofbergamot,verbena,caraway,pink
pepper,andviolet
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Este Lauder
MARKETINGACTIVITY
Este Lauder supports its brands with TMEs of $385.6 million in 2012, up 41.9% from
The company supports the launch of its new products with an effective pullpush
marketing mix, composed of a combination of television, print, digital application,
stores,andwebsites.
CliniquereceivesthehighestadvertisingsupportwithaTMEof$135.3millionin2012,
Este Lauders flagship brand, Este Lauder, follows close behind with a TME of
$133.5millionin2012,upalmost50%fromapproximately$89millioninTMEin2011.
ThecompanysupportsitsfacialtreatmentswiththehighestTMEof$142.7millionin
2012.ThecategoryreceivedaTMEof$125.2millionin2011.
CliniquesEvenBetterClinicalDarkSpotCorrectorSerumcontinuestoreceivethemost
TMEsupportwith$49.6millionin2012,up50.8%from$32.9millionin2011.Product
advertisements include an impactful use of a spotted egg transitioning to a flawless
finish,illustratingthebenefitsoftheproduct.
Este Lauders Idealist Even Skintone Illuminator Serum receives the secondhighest
TMEat$25.9millionin2012,marginallyupfrom$25.5millionin2011.
In 2012, Clinique airs its first television advertisement to support its Even Better
makeup SPF 15 Foundation. In the same year, Clinique also introduces a television
advertisementforitsChubbyStickMoisturizingLipcolorBalm.
Avedas newest hair care system, Invanti, is supported by the brands first ever
televisioncampaign,whichiswellreceivedbyconsumersandhelpsupliftthesalesof
thecompany.
Este Lauders most favored marketing media include traditional advertising methods, in
theformofprintadvertisementsandtelevisioncommercials.
The marketer conducts a lot of magazine advertisements to promote Este Lauder
products. Advertising is done typically in national fashion magazines such as Vogue,
Glamour,Allure,andElle.
Este Lauders emphasis on digital and television advertising has led the marketer to
expanditsconsumeroutreachandattractconsumersfromthemassmarket,especially
towardsitsClinique,EsteLauder,andMACcosmeticsbrands.
Televisioncommercialscontinuetogainimportanceasoneofthepreferredadvertising
media, with a TME support of $163 million in 2012, up 67.2% from $97.5 million in
2011.
Brands, such as Tom Ford beauty and Smashbox, use the traditional print media to
ThemajorityofCliniquesadvertisingspendingisdirectedtowardwomensmagazines
through fullpage advertisements. These advertisements highlight the message that
Cliniqueisallergytestedandpositionsitselfas100%fragrancefree.
CliniquestelevisionadvertisementsforitsEvenBetterClinicalhavebeeninstrumental
inattractingmassmarketconsumerstowardstheprestigemarket.
In 2012, the marketer conducts the first national advertising campaign for its color
cosmeticswithacommercialforitsCliniqueChubbyStick.Theadvertisementgoeson
airinMayandlastsuntilfall.
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Este Lauder
Este Lauder continues to capitalize on its Internet marketing initiatives as an important

meanstoreachouttoconsumersin2012.
TheCliniquewebsiteofferssamples,orevenatwoweeksupplyofaparticularproduct
which a certain minimum purchase. The website also highlights the ongoing offer of
theday.
Purchases through Cliniques website receive free shipping every day, no matter the
valueofthepurchase.
During2012,CliniqueoffersatwoweeksupplyofRepairwearLaserFocusatcounter
with no purchase necessary, to encourage trial. After a return consultation, another
twoweek supply is issued, so that the consumer will have four weeks to try out the
product.
CliniquemaintainstheInsidersClub,whichcustomerscanjoinafterenteringtheire
mail address on the brands website. The Insiders Club provides customers with an
insidescooponCliniquesproducts,freetreats,andseveralothertreatsexclusiveonly
tothemembersoftheclub.
InstoremarketingisanextremelyimportantmarketingmediumadoptedbyEsteLauder
topromoteitsproducts.
EsteLauderoftenpartnerswithkeyprestigeretailersforitsadvertisingeffortsandin
storeeventstospursales.
The marketers promotional activity within stores generally centers on bringing
consumers to the beauty counters, where sales personnel offer free makeovers,
consultations,andproductsamples.
EsteLaudersupportsitsmakeupproductsthroughcomplimentarymakeoversoffered
inselectretailstores.
In 2012, Emily Schuman, creator of the blog Cupcakes and Cashmere and Este
Lauders guest blogger, stops at Bloomingdales for signing her first book called
Cupcakes and Cashmere: A Guild For DefiningYour Style,Reinventing Your Space and
EntertainingwithEase.ThebooksigningsattractsmanynewandexistingEsteLauder
consumersandhavedoubledthemarketersexpectationsduringeachoftheauthors
appearance.
Alsoin2012,CliniquesassociationwithmodelturnedactivistPetraNemcova,boosts
traffic at department stores such as Bloomingdales where she makes a guest
appearance. The brand also assigns the tag Happy Day to December 14, 2012
wherein, the companys executives assist the beauty advisers at retailers throughout
thedistributionnetwork.
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Este Lauder
Este Lauder relies primarily on giftwithpurchase (GWP) and purchasewithpurchase

(PWP) promotions, and also on a wide range of other promotional efforts including
sampling.
Clinique, the luxury segment market leader, relies primarily on GWP and PWP
promotionofferstopromoteitsbrandsandhelpdrivesales.
Makeup cases, either generic or from a designer such Tracy Reese or Trina Turk, are
commonly included as part of Cliniques GWP or PWP promotions at leading
departmentstores.Insidethesemakeupcasesareanarrayoflongstandingandsome
new products for the consumer to try, typically offered with a purchase of $28.00 or
more.
EsteLauderoffersfreeshippingwithbeautypurchasesoveracertainamountas an
incentivetoencouragepurchase.
EsteLauderdistributessamplesofitsproductstoitsconsumers,especiallysamplesof
newproducts.
Commonsamplingmethodsadoptedbythemarketerincludefragrancevialsattached
to cards, scented strips in magazines, and scented blotter cards distributed at retail
stores. Other forms of sampling in stores include deluxe miniatures and scented
ribbons.
Este Lauder offers free samples, a choice of an Este Lauder perfume, mascara, or
facialproduct,witheveryonlineorder.
During 2012, Este Lauder holds a monthly sweepstakes in which the grand prize
winnerreceivesa$350.00shoppingvoucher.Consumersenterthepromotionbyfilling
outaformonthebrandswebsite,withnopurchaserequired.
Socialanddigitalmediaplayaprominentroleinthecompanysmarketingandpromotional
strategy,withthemarketersintroducingnewsocialmediaandecommercecampaignsfor
almosteachofitsbeautybrands.
The marketer uses the increasingly popular social media channels in the form of
Facebook,Twitter,andYouTubetopromoteitsproducts.
In2012,EmilySchumanpostsweeklyonthecompanyswebsitewithcontentfromthe
posts being shared on Facebook, Twitter, Pinterest, YouTube, and Instagram. Emily
Schumans stepbystep athome manicure guide on Facebook has gained popularity.
Otherpopularpostsincludevideotutorialsoncreatingametallicsmokyeyelookand
thegildedfademanicure.
In 2012, Este Lauder launches the Bobbi Brown Brings Back: Lip Color whereby
consumers have a chance to vote for one of the 10 discontinued lip shades creating
curiosityamongthebrandsloyalistsandanticipatingpurchase.
Twitterhasbeenanimportantsiteforthemarketer.InApril2012,themarketerstarts
acampaignonTwitterwherebyitusespromotedtweetsandensuresthatitsmessage
staysinthenewsfeedofthetargetedconsumeraudience.
In2012,MACCosmeticsemployeesutilizemicrobloggingsites,suchasTwitter,under
theiraccountnamestointeractwithconsumers.
Smashboxs Lights, Camera, BB! Facebook application educates consumers on the
benefits of the brands latest product introductions and also allows consumers to
featureinitsBBcommercial.
Cliniques Chubby Stick digital campaign on Facebook includes a mixandmatch
concept for lip shades whereby the marketer induces multiple purchases from
consumersbyshowingtheresultswhentwoorthreeChubbyStickarecombined.The
resultcanalsobeemailedtoafriendintheformofadigitalkiss.
4A146
Este Lauder
Este Lauder steps up its importance towards digitalization as an important marketing

mediumin2012.
In an attempt to build brand awareness and expand its consumer base, the brand
introduces the digital send a sample application which allows consumers to try the
brandsproductsfreeofcostin2012.
In 2012, the marketer increases the digital pull efforts for its Bobbi Brown brand.
Initiatives include the Bobbi Brown Blog whereby the brands representatives
interactdirectlywiththeconsumerscreatingapersonalrelationshipbetweenthetwo
parties.Theblogbecomesaninstanthitwithconsumersattractingseveralviews.
To promote its Clinique Chubby Stick, the marketer designs a digital campaign
comprisingdigitalmarketingandmarketingthroughtaxitopsandtaxitelevisionswhich
begintoappearinMay.
In 2012, Clinique gives its departmentstore selling space a makeover by creating an
environment for consumers that is free of interference from a salesperson. The
CliniquestoreshaveasignboardreadingCarryaCliniquebrowsingbasketandwell
leaveyoualone.Promiseabovethestackofshoppingbasketswiththeavailabilityof
whitecoatedlabconsultantsatanygivenpointoftime.Cliniquehasswitchedtothe
useofopensellingenvironment.Accordingtothenewprogram,thecompanyinstructs
itssalesconsultantstoloosenupabitwiththeirsalesskillsandjudgecustomersbased
ontheirbodylanguage.CliniquealsooffersanewapproachknownastheServiceAs
youLikeItwherebyconsumerscanopenupdrawersandhelpthemselvestoproducts
without taking any permission. Consumers shopping needs also depends on their
moods and the time they have at their disposal. The brand has also taken into
considerationtheroadblocksthatwerehavinganegativeimpactonthebrandssales,
such as displaying the prices of the products upfront, availability of more mirrors
includingalipstickdisplaywhichismountedonthewallwithamirrorunderneathit,an
array of containers containing cotton swabs and tissues, and different tester wand
typesformascarastocorrespondtothemascarawandsinsidethetubeofaparticular
product.
In 2012, Este Lauder makes the atthecounter experience more meaningful for its
Clinique brand by launching the Experience Bar at its Bloomingdales 59th Street
flagshipstoreinManhattan.TheExpansionBaristhenewestadditiontoCliniquesAs
YouLikeItProgramthatfeaturesseveniPadsthatprovidepersonalanalysisandgives
skin care advice in nine languages. The bar also provides the worlds first musical
testers.ThebarfeaturestheinstallediPadsand11leadingCliniqueproductsmounted
on the wall arranged according to significancebest sellers, dermatological concerns
and solutions, serums, and moisturizers. Above the bar, on the wall are mounted
screensthatflashvideos,images,andinformation.Thetesterunitsaredesignedina
waythatinadditiontodispensingtheproductsample,italsoplaysamusicalinterlude
which signifies the character of the product, when the consumer presses the button.
Consumersfirststepofusingthebarinvolvesansweringninebasicquestionsonthe
iPad through its proprietary software program. The possible combination of answers
can lead to 180,000 possible recommendations with 52 million logic pathways in the
program. Customers can also get a print of their recommendations. Consumers also
havetheoptionofemailingtothemselvesthelistofsuggestions.
5147
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Este Lauder
Este Lauder organizes and sponsors events and charity shows and is associated with a
number of campaigns as a means to stay in the limelight with the wealthier segment of
societyanddisplayitsphilanthropicinitiatives.
EveryyearMACCosmeticsusesacelebritytoendorseatrademarkproductforitsViva
GlamCampaign.In2012,ithasselectssingersNickiMinajandRickyMartintopromote
the bubblegumpink lipstick and colorless unisex lip conditioner, respectively. The
unique feature of MACs Viva Glam Campaign making it different from other brands
celebrity endorsements is that all the proceeds from the Viva Glam products are
donated to the MAC AIDS Fund. The print advertisement for the 2012 campaign
features Nicki Minaj crawling on a motorcycle dressed in a pink dress while Ricky
Martinisfeaturedstandingbehindthemotorcycle,weightliftingagiantlipstick.
TheMACAIDSFundandtheVivaGlamCampaignhavecontinuedtoraisemoneyfor
AIDS research, bring about awareness for AIDS prevention, and attract celebrities.
Este Lauder uses the strategy of choosing rock stars, models, and actresses over
doctors and public health officials to bring about awareness for HIV and AIDS
prevention, as consumers are more interested in what these celebrities have to say,
anditmakesamorelastingimpression.
In2012,themarketercelebratesthe20thAnniversaryoftheEsteLauderCompanies'
Breast Cancer Awareness campaign (BCA), which is now active in over 70 countries
worldwide.In20years,theBCAhasraised$35millionforresearchandeducation.The
2012CampaignthemeisCourage.Themarketersbrandshavejoinedtogethertosell
Pink Ribbon products to raise awareness for breast cancer and funds for medical
research.PinkRibbonproductsincludebrandssuchasEsteLauder,Clinique,andLab
Series Skincare for Men, and Bumble and bumble. On October 1st, 2012 the Empire
State Building is illuminated and the day is officially proclaimed as the "The Este
LauderCompaniesBreastCancerAwarenessCampaignDay."Thecompanyencourages
consumerstovisitFacebook.com/BCACampaigntopostamessageandBCAwilldonate
$1 to the Breast Cancer Research Foundation for every milestone of courage posted
throughout October. Another of the marketers social initiatives includes Clinique
association with model Petra Nemcova who has turned into an education advocate
with her Happy Hearts Fund, which assists children affected by natural disasters.
Nemcova survived the 2004 tsunami when she was vacationing in Thailand, but her
fiancwaskilled.Cliniqueorganizesafundraisingeventforthesaleofapproximately
30 million Clinique Happy Heart womans fragrance and Make Someone Happy t
shirts.Cliniquedonates$10.00and$5.00foreverybottleoffragranceandtshirtsold,
respectively.
4A148
Este Lauder
SamplingisofextremeimportancetoEsteLaudersoverallmarketingstrategy.
Este Lauder believes in distributing a lot of samples to its consumers, especially
samplesfornewproducts.
EsteLaudersvalueorientedgiftsetscontinuetobeavailableroundtheyear,asthey
appealtotheconsumersdesireforvarietyandvalue.
Common sampling methods for fragrances include fragrance vials attached to cards,
scentedstripsinmagazines,andscentedblottercardsdistributedatretailstores.Other
formsofsamplinginstoresincludedeluxeminiaturesandscentedribbons.
Este Lauder offers samples and free shipping of products for its leading brands
CliniqueandEsteLauderforordersaboveaspecificvalue,suchas$25.00or$35.00.
The brand offers samples from a choice of Este Lauder perfumes, mascara, or facial
productswitheveryonlineorder.
Este Lauders promotional offers are available in the brands newsletter via email on a
regularbasiswithitsregisteredusers.
EsteLaudersnewsletteroffercouponsandongoinginsightsaboutthebrand.
Additionally, the avenues to receive coupons or price rebates have continued to
increaseduringthelasttwotothreeyears.
Este Lauders price promotion offers are available on the brands website, various
retailerswebsites,mobilemarketing,andsocialmediapages.
EsteLauderhasbeenknowntoofferperonlineorderasample,achoiceofanEste
Lauder perfume, mascara, or facial product. Periodically, Este Lauder offers free
shippingforonlineorders,withnominimumamountrequired.
EsteLauderalsointroducesanumberoflimitededitionproductsasapartofitsmarketing
strategytokeeptheconsumersinterestedinitsproducts.
The marketer introduces a multidimensional, limited edition trendcollection for Fall
2012calledtheEsteLauderPureColorVioletUnderground.
OUTLOOK
EsteLauderssalesareforecasttogrowataCAGRof4.2%duringtheforecastperiod.The
companyisexpectedtooutshineitscompetitorsintheprestigemarketduringtheforecast
period,2012to2017.
The combination of innovative products backed by robust marketing is likely to fuel
growthovertheforecastperiod.
The company will focus its efforts on the introduction of a few big and wellplanned
innovativeproductsthatwillhavethedesiredimpactontheconsumers.
Increasedadvertisingexpendituresacrosstelevision,print,anddigitalmediatailoredto
thecustomneedsofeverybrandwillhelpdrivethesalesforthemarketersindividual
brands.EsteLauderisexpectedtoplayonitsstrengthsbyfocusingondevelopingits
biggestbrands,leveragingnewproductlaunches,andevolvingitsHighTouchservices
togainsalesduringthenextfiveyears.
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Este Lauder
Thecompanywillcontinuetobenefitfromitsexpandingdistributionchannelandnewtie
upswithretailersinordertoachievehighersalesduringthenextfiveyears.
Este Lauders distribution network comprises a few select retail channels, including
freestanding companyoperated stores, company websites, a few authorizedretailer
websites,storesoncruiseships,directresponsetelevision,andinflightanddutyfree
shops.
The marketer benefits from its selective distribution channel due to the personal
relationshipsharedwiththeretailers.
Travel retail continues to be a good opportunity for the marketers to expand upon.
Withdevelopedairportenvironments,thechannelhasevolvedtobuildtheequityof
thebrandsduringjourneys.
Intheairportenvironment,themarketeroffersHighTouchservicesandeventssuchas
makeupdemonstrations,popupstores,andmultilingualdigitaldisplays.Forexample,
at New Yorks John F. Kennedy International Airport, the marketers advertisements
shiftinlanguagesasthedayprogressescateringtotravelersfromallregions.
BrandssuchasEsteLauder,Clinique,andBobbiBrownBBcreamswerealloriginally
launchedthroughthetravelretailchannel.
Additionally, Este Lauder utilizes alternate distribution channels such as direct
response television and the Internet to expand its operating margins. The companys
webpagesonsocialnetworkingsitesallowsthemarketertoengagewithitscustomers
by informing them about new offers, new products, gift sets, and other relevant
information.Internetorderingwillalsoenhancemarginsbyreducingsellingexpenses
andthereforewillbeanimportantprofitmakingchannelinthefutureaswell.
Otherancillarytools,suchasemailnewslettersincreasebrandawarenessandeducate
consumersaboutthenewandthelatesthappeningsforthemarketer.
Este Lauder will continue to strengthen its distribution network with Sephora and
otherspecialtymultibrandretailers,withthefocusonthedepartmentstorechannel.
In the fall of 2012, the marketer tests its Este Lauder flagship brand at 25 Sephora
doorsinNorthAmerica.
Ecommerce has been a strong promotional channel for Este Lauder and is likely to
gainfurtherimportanceduringthecomingyears.Ecommerceallowsthemarketerto
reach consumers in remote areas where the marketer does not have any brickand
mortaroutlets.
The marketer is also likely to emphasize on the importance of mobile commerce
channelinthecomingyears.
It will continue to launch social media campaigns for its beauty brands and new
products.
The company will also look to capitalize on social media networks to gain consumer
insights. The company will use the information provided by consumers through
feedbacks,productratings,andreviewstoimproveitsproducts,packaging,andtailor
itsmarketingandmerchandisingefforts.
4A150
Este Lauder
EsteLauderwillcontinuetoinnovateinanattempttoattractmoreconsumersandgain
salesduringtheforecastperiodending2017.
The companys key pillars Este Lauder, Clinique, and MACwill help drive sales
backed by innovative new product introductions, emphasis on developing high
performing skin care products, and engaging television marketing and promotional
tools.
Themarketerisexpectedtosupportitsnewproductintroductionswithdynamicmixof
marketing including engaging advertising, digital, and social media strategies, and
effortstoattractnewandexistingconsumerstoitscounters,eandmcommercesites,
retailers,andstorestodrivesalesacrossvariousproductcategories.
Themarketerisalsolikelytoperformwellduetoincreasingwillingnessandimproving
purchasingpowerofwomen.
EsteLauderislikelytocontinuetocreateconsumerdriveninnovationswiththeaim
ofattractingexistingandnewconsumers.Someoftheconsumerinspiredinnovations
in2012includetheintroductionoftheIdealistCoolingEyeIlluminator,anextensionof
theIdealistEvenSkintoneIlluminatorthathelpsreducetheappearanceofundereye
puffiness and dark circles. Cliniques Moisture Surge Intense Skin Fortifying Hydrator,
meant to provide moisture barrier protection, is well received by consumers. The
AvedaInvatiCollection,tacklingtheproblemofthinninghair,hassuccessfullyhelped
increase the sales in the hair care products class. The MAC Matchmaster SPF 15
FoundationwithShadeIntelligenceTechnologycomprisespatentpendingtranslucent
pigmentstogiveamorepreciseskintone.OriginsextendsuponthesuccessofitsDr.
Andrew Weil for Origins by introducing MegaBright, a serum that addresses the
problemofunevenskintone.
Bumbleandbumblewillcontinuetorelyonthecombiningcreativitywithinnovationto
helpexpanditssalesinthehaircarecategory.
Technologically, the marketer has a very strong year in 2012, with digital content to
communicateandconnectbetterwithconsumers.
Duringthecourseoftheforecastperiodending2017,themarketerisexpectedtodrive
its HighTouch services to new digital heights. This will help the company to connect
withtheconsumersbeyondtheirexpectationsinordertoachievesalesgrowth.
The HighTouch Online Skin Care Guide developed for www.origins.com is another
example of the marketers HighTouch services initiatives. The tool offers consumers
personalizedfeedbackandrecommendationofproductsbasedonskincareconcern.
A similar tool is introduced in 2012 on www.jomalone.com with fragrancecombining
consultations.
MACalsoofferstheseHighTouchservicesintheformofitsMagicMirrorinteractive
station, especially designed for the travelling consumers, acting as a support tool for
themakeupartistinordertoreceiveamorepersonalizedexperience.Theinteractive
application provides product descriptions in various languages and when combined
withamakeupsession,allowsconsumerstoreceiveadigitalphotographoftheirnew
lookwithacustomizedlistofproductsemailedtothem.
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Este Lauder
Themarketerwillcontinuetoaccelerateandemphasizeonthedevelopmentandwill
keepitsdigitaltechnologyuptodate.
The company has improved its counter designs, merchandising, and navigation,
incorporateddigitaltechnology,andrefiningtheretailexperiencefortheconsumers.
Cliniques Apple iPad Skin Care Diagnostic application allows consumers to identify
concernsrelatedtotheirskinandrecommendsacustomizedregimeofproductstobe
used.
The facial treatments category is expected to be of utmost importance to the company

Sales for the category are expected to grow at a CAGR of 7.5% during the next five
years.
Este Lauder is expected to keep up the momentum with innovative and
technologically advanced products that not only provide instant gratification but also
longtermbenefits.
EsteLauderclaimsthatitsproductsprovidedermatologicalbenefits,suchasevenskin
toneandblotchiness,andreducesdarkspots.Thiswillcontinuetobeakeytrendfor
themarketersportfolioofproductsandinduceconsumerstopurchasetheseproducts
withthebeliefofprovidingprofessionalresultsathome.
EsteLauderisalsoknowntoenrichitsproductformulationswithrareandhardtofind
biological and natural extracts that give the marketer an extra edge over its
competitorsinthemarket.
The makeup and skin care product classes will continue to drive sales for the company
Themarketerwillcontinuetofocusitseffortsondevelopingfacialtreatmentproducts
thatfightsignsofagingandhelpinreducingtheappearanceoffinelinesandwrinkles.
Theuseofmorenaturalandtechnologicallyadvancedformulationswillhelpdrivethe
upthepricepointsoffacialtreatmentsproducts.
Themarketerwillalsocontinuetoimproveitsproductformulationswithmultibenefits,
suchasSPFprotection,reductionofagespots,improvedskintone,andacnesolutions,
initsproducts.
EsteLaudersMACwillpersistwithitsstrategyofintroducinglimitededitionproducts,
togeneratecuriosityandinterestamongconsumerstherebyinducingpurchaseofhigh
pricedproductswhilethestockslast.
EsteLauderwillcontinuetolookouttoexploitstrategicalliances,partnerships,affiliations,
andlicensingwithanattempttobeatitscompetitorsinthemarketwithrespecttoresearch
anddevelopment,distribution,andthirdpartymanufacturing.
4A152
Este Lauder
Duringtheforecastperiodending2017,EsteLauderislikelytofocusonthedevelopment
of its business in key product classes, such as skin care, makeup, and fragrances, thereby
havinganegativeimpactonthesalesofitsothersmallerproductclassessuchashaircare
andothertoiletries.
SalesofEsteLauderscosmeticsandtoiletriesareprojectedtoincreaseataCAGRof4.2%
toreach$3,342millionby2017,upfrom$2,722millionin2012.
Table584:ForecastDollarSalesGrowthofCosmeticsandToiletriesforEste
LauderbyCategory,2012to2017
Category
CAGR,%
Facialtreatments
6.4
4.3
COMPANYAVERAGE
4.2
Facemakeup
3.8
Suncareproducts
3.2
Eyemakeup
3.0
Nailpolishes
2.9
2.8
Shampoos
2.7
Conditioners
2.7
2.4
1.5
Handandbodylotions
0.8
Fragrancesforwomen
0.5
Fragrancesformen
Shavingproducts
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Este Lauder
4A154
GLAXOSMITHKLINE
Table585:GlaxoSmithKlinesSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
Category/brand
2011
TOOTHPASTES
2012
Sensodyne
132
149
Aquafresha
84
80
Biotene
13
13
229
242
Poligripbr
65
74
Polidentc
45
45
DentuCreme
Wernets
116
125
Biotene
19
21
Targonr
21
21
12
Total
DENTUREPRODUCTS
Totalr
MOUTHWASHES
Total
Aquafresh
TOOTHBRUSHES
Aquafresh
FACIALTREATMENTS
MaxClarity
TOTALr
392
407
aIncludesAquafreshExtremeClean,Advanced,Sensitive,ForKids,andRegular:
BakingSodawithPeroxide,BakingSodavariety,andExtraFresh.
bIncludesSuperPoligrip,PoligripUltraFresh,andPoliGripFree.
cIncludesPolidentOvernight,Smokers,ForPartials,andPolidentPowder.
rRestated
5156
GlaxoSmithKline
COMPANYOVERVIEW
GlaxoSmithKlineisapubliclimitedcompany,establishedin1999.
ThesharesofthecompanyaretradedontheLondonandNewYorkStockExchanges.
TheheadquartersofthecorporationisinLondon,theUnitedKingdom.
ThecompanysthreeprimaryareasofbusinessincludePharmaceuticals,Vaccines,and
ConsumerHealthcare.
Asof2012,thecompanyemploys99,488employeesgloballywithapproximately40%
or38,788employeeslocatedinEurope,36.9%or36,738locatedinEMAP,and17.3%
or17,201locatedintheUnitedStates.
TheU.S.operationsofthecompanyarebasedinPhiladelphia,PA.Asoneoftheleading
pharmaceuticalcompanies,GlaxoSmithKlineexploresbothmedicinesandvaccinesfor
the World Health Organizations three priority diseasesHIV/AIDS, tuberculosis, and
malaria.
GlaxoSmithKlineholds7%oftheworldspharmaceuticalmarket,makingitoneofthe
industrysleaders.
The company has its own offices in more than 115 countries, while its products are
distributedinmorethan150countries.
Its products, particularly pharmaceuticals, are distributed virtually throughout the
entireworld.
Inadditiontothemanufacturingfacilitiesthatthecompanyownsin34countries,itholds
key research and development centers in Belgium, China, the United Kingdom, and the
UnitedStates.
Thecompanyhasanetworkof87manufacturingsitesandresearchanddevelopment
centersintheUnitedKingdom,theUnitedStates,Spain,China,andBelgium.
The companys activities are separated into three business units: Pharmaceuticals,
Vaccines,andConsumerHealthcare.
ConsumerHealthcareisclassifiedintothefollowingproductcategories:totalwellness,
oralcare,nutrition,andskincare.
Popular overthecounter (OTC) brands distributed by the company are Aquafresh,
Sensodyne, Biotene, and Nicorette. Some of GlaxoSmithKlines prescription drugs are
Paxil, Avandia, Advair, and Wellbutrin. The company also markets drinks such as
Horlicks,Lucozade,andRibena.
Consumer Healthcare specializes in the following product categories: OTC medicines,
dentalproducts,smokingcontrolproducts,nutritionalhealthcaredrinks,andskincare.
4A156
GlaxoSmithKline
GlaxoSmithKlinesrevenueswitnessa3.5%dipto26,431million($41,887million)in2012,
from27,387million($43,403million)in2011.
Its pharmaceuticals and vaccines business unit command 80.7% of GlaxoSmithKlines
totalcorporatesalesin2012,withbusinessworth21,321million($33,789million).
Within the consumer healthcare business, total sales decline 1.6% to 5,110 million
($8,098million)in2012,from5,195million($8,233million)in2011.
Thecompanysnetincomedeclinesby13.1%from5,458million($8,650million)in2011,
to4,744million($7,518million)in2012.
Table586:GlaxoSmithKlinesGlobalSales,2007to2012
Million
Year
Sales
Netprofits
Marginonsales,%
2007
22,716
5,310
23.4
2008
24,352
4,712
19.3
2009
28,368
5,669
20.0
2010
28,392
2,961
10.4
2011
27,387
5,458
19.9
2012
26,431
4,744
17.9
NOTE:$1.00=0.6310.
GlaxoSmithKlines annual sales in the cosmetics and toiletries industry advances 3.8% to
reach$407millionin2012,upfrom$392millionin2011.
Since2007,GlaxoSmithKlinescosmeticsandtoiletriessaleshavegrownataCAGRof2.0%.
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GlaxoSmithKline
Table587:GlaxoSmithKlinesSalesofCosmeticsand
ToiletriesintheUnitedStates,2007to2012
Year
$Millionr
Change,%
2007
368
2008
376
2.2
2009
368
(2.1)
2010
395
7.3
2011
392
(0.8)
2012
407
3.8
rRestated.
GlaxoSmithKline remains the thirdleading marketer in the toothpastes category with a

13.8%marketsharein2012,upfrom13.3%in2011.
Totalsalesofthemarketergrowby5.7%to$242millionin2012,upfrom$229million
in2011.
Growth in sales for GlaxoSmithkline is supported by Sensodyne, which experiences
stronggrowthandseesitsshareincreasefrom7.7%in2011to8.5%in2012.
SalesoftheSensodynebrandgrow12.9%,upfrom$132millionin2011to$149million
in2012.
The launch of Sensodyne Pronamel Gentle Whitening toothpaste and Sensodyne
Sensitivetoothpastesupportsthebrandsgrowthin2012.
Aquafresh, the next largest brand for the company, has its sales decline from
$84million in 2011 to $80million in 2012. The lack of new product activity and a
decreaseinmarketingactivitylimitsitssalesin2012.
Thebrandnowholdsamarketshareof4.6%in2012,downfrom4.9%in2011.
Biotene, a much smaller brand used to treat excessive tartar, dry mouth, and oral
irritations,remainsflatatjust$13millionin2012.
In2012,GlaxoSmithKlinelaunchesnewproductsundertheSensodynebrand.
GlaxoSmithKline along with Procter & Gamble is the leading marketer in the denture
In 2012, sales for the category leader GlaxoSmithKline increase 7.8% to $125million
GlaxoSmithKlineconstitutes39.3%ofthemarketsharein2012,upfrom36.9%in2011.
GlaxoSmithKline is the secondleading marketer of denture adhesives, behind
Procter&Gamble, capturing almost onequarter of the categorys market share in
2012.Thecompanysdentureadhesivessalesrisebynearly$9millionduringtheyear.
The companys growth in the denture adhesives segment is supported by the
introductionofanewadhesive,PoligripforPartials.
ThemarketerremoveszincfromitsPoligripbrandstopromoteitssalesin2012,aszinc
indentureproductsisfoundtocausehealthproblems.
Dentureadhesivesaccountforabout62%ofthecompanysdentureproductsales.
GlaxoSmithKline continues to be the leading marketer of denture cleansers in 2012,
withover40%segmentshare.Polidentisthetopbrandinthesegment.
4A158
GlaxoSmithKline
GlaxoSmithKlines sales in the mouthwashes category remain constant at $21 million in

ThebrandsmarketedwithinthiscategoryincludeBioteneandTargon.
Themarketersmarketshareinthecategorydeclinesmarginallyfrom2.7%in2011to
2.6%in2012.
GlaxoSmithKline,whichtiedwithGoSmileforsecondplaceinthetoothwhiteningproducts
categoryin2011,dropstothethirdplacein2012.Thecompanyexperiencesadeclineinits
marketsharefrom4.2%in2011to3.3%in2012.
Sales of Aquafresh White Trays drop sharply by 25.0% from $12million in 2011 to
$9millionin2012.
GlaxoSmithKline entered the category in 2007, but has not been able to significantly
buildsales.Itstrayformathasnotbeenaspopularwithconsumersastheeasytouse
andlessintrusivestrips.
The trays have not performed well as they are uncomfortable to fit and moreover,
cause a lot of inconvenience compared to whitening gels which are easy to use. The
marketerhasnotlaunchedanyotherformsinthecategory.
Sales of GlaxoSmithKline in the toothbrushes category remains stagnant at $9million in

RECENTDEVELOPMENTS
Nomergersandacquisitionsarereportedin2012.
Managementchanges
InJanuary2012,GlaxoSmithKlineappointsPatrickVallanceasPresidentofPharmaceuticals
R&D.
Priortothis,heservedasSeniorVicePresident,MedicinesDiscoveryandDevelopment.
InJanuary2012,itisannouncedattheAnnualGeneralMeetingthatHansWijers,Chairman
ofHeineken,willjoinGlaxoSmithKlineasNonExecutiveDirector..
InApril2012,LynnElsenhansandJinUlrichareappointedasNonExecutiveDirectors.
SeniorIndependentNonExecutiveDirector,SirRobertWilsonhasagreedtoremainonthe
Boardforanadditionalyearin2012toprovideadviceandexpertise,whilenewmembers
settlein.
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GlaxoSmithKline
Newproducts
Table588:SelectNewProductsIntroducedbyGlaxoSmithKlineintheUnitedStatesin2012
Brand
Category
Description
Mentadent
Toothpastes
MentadentAdvancedWhiteningRefreshingMinttoothpasteclaimstowhiten
teethinsevendays.Italsoaidsinremovingplaqueandpreventstartar
buildupbeforeitforms
Poligrip
Denture
products
PoligripSeal&Protectadhesivestabilizespartialproblemsandreduces
potentialproblemsinthefuture
Toothpastes
SensodynePronamelGentleWhiteningtoothpaste,sugarfreeanticavity
toothpaste,forsensitiveteethtoprotectagainstthegrowingproblemofacid
wear.Itprotectsteethagainstaciderosion,hardensenamel,andwhitens
teeth
Sensodyne
Otherdevelopments
In late 2011, GlaxoSmithKlines Consumer Healthcare business was restructured into four
categories:Totalwellness,Oralcare,Nutrition,andSkinhealth.
Effectsoftherestructuringarevisiblein2012.
MARKETINGACTIVITY
GlaxoSmithKlines traceable media expenditures (TMEs) in the cosmetics and toiletries

markettotal$130.0millionin2012,down13.3%from$149.9millionin2011.
Thecompanyutilizestraditionalmarketingmedia,suchastelevision,print,andradio;
socialmedialnetworkssuchasFacebookandTwitter;andInternetmarketingthrough
websitestopromoteitsbrands.
Aquafresh,throughitswebsite,offerstipsforattaininghealthyadultteeththroughsub
segmentssuchaswhiterteeth,strongteeth,healthygums,freshbreath,andaskthe
experts.
Aquafreshswebsiteprovidestipsformomsandallowschildrentoplayonlinegames
andthentradethepointsthattheyscoreforgiftssuchascoloringbooksandbrushes.
Aquafreshs website gives consumers an additional advantage of joining their club
whichprovidespersonalizedtips,expertadvice,andsavingandopportunities.
Sensodyne, through its website, educates consumers on acid erosion and sensitivity
problemsencounteredbyconsumers.
Sensodyne also offers discount coupons for its toothpastes and toothbrushes in the
form of a $0.75 off on Sensodyne Toothpastes and $0.50 off on Sensodyne Precision
Toothbrush.
4A160
GlaxoSmithKline
GlaxoSmithKline focuses its promotional activities on Sensodyne in the toothpastes

category.
In2012,thecompanyallocatesabout$77.2millioninTMEtoSensodyne.Sensodyneis
mainly advertised through television advertisements, with almost 95% of the brands
advertising budget spent on television promotions. Magazines and the Internet
advertisementsarealsoused.
The marketer supports its new launch, Sensodyne Pronamel with a TME of $19.5
millionin2012.
In2012,TMEof$20.9millionareallocatedforAquafreshtoothpaste.
GlaxoSmithKline remains the leading advertiser in the denture products categoryin 2012,
withmorethan$12.8millioninTMEforitsproducts.
ThecompanymarketsfourbrandsinthecategoryincludingPoliGrip,Polident,Dentu
Crme,andWernets.In2012,PoliGripreceivestheentireTMEof$12.8million,asthe
companydoesnotallocateanyTMEtoitsotherbrands.
Thecompanyallocatesitsentireadvertisingbudgettotelevision,withnoneallocated
totheprintmedia.
Themarketeralsooffersdiscountcouponsof$1.00onitsPolidentandPoligripbrands.
However, GlaxoSmithKlines 2012 spending is 38% lower than its 2011 TME of
$20.8millioninthedentureproductscategory.
GlaxoSmithKlineshowsnoTMEforAquafreshinthetoothwhiteningproductscategoryin
2012.
In2012,GlaxoSmithKlinesupportsitsAquafreshbrandinthetoothbrushescategory,witha
TMEof$2.3million.
GlaxoSmithKline promotes its toothbrushes with about 51% of its TME on television
advertisementsandtheremainingTMEspentonmagazines.
DetailsonTMEareincludedintheAdvertisingsectionofthisreport.
5161
5162
GlaxoSmithKline
OUTLOOK
Manufacturers sales of GlaxoSmithKline in the cosmetics and toiletries industry are

expectedtogrowatamoderaterateof1.6%duringtheforecastperiodending2017.
GlaxoSmithKlinewillcontinuetomakeprogressinthecosmeticsandtoiletriesmarket
as it attempts to make a mark in the industry with increasing focus on its oral care
brandssuchasAquafreshandSensodyne.
Growth will be supported by the companys urge to innovate with its portfolio of
products by introducing scientifically advanced products, products with new and
advancedtechnologiesandformulations,andextenditsproductlines.
The marketer is expected to increase spending on innovation and research efforts to
introduceinnovativeoralcareproducts.
GlaxoSmithKlines fully integrated supply chain will allow for greater flexibility and
moreresponsivenessfromthesupplychainduringthecomingyears.
GlaxoSmithKline is expected to continue to increase its media expenditures or
advertisingforitsbrands,overthenextfiveyears.Itwillcontinuetosupportitsnew
productlaunchesintheoralcareproductclasswithinnovativemarketingthroughprint
andtelevisionadvertisements.
GlaxoSmithKlineislikelytoexpandtheoutreachofitsmergerandacquisitionsstrategy
to e toral care categories in order to diversify oral care product technologies and
introducenewproductsinitsconsumerhealthcaredivisiontooffsetthesaturationof
themarketforitstraditionalproducts.
BeingadominantmarketerintheOTCsegment,ithasa strongrelationshipwiththe
retailers and is expected to use it to the advantage of pushing its new products to a
widersectionofthesociety.
Naturallyformulated toothpastes could be a potential area for the marketer to
innovateinandexpanditsoutreachofproductstoavarietyofconsumers.
Sensodyne and Aquafresh are expected to continue to do well in the toothpastes
category due to the ability to offer a range of products targeting various oral care
concernsincludingbattlingtoothsensitivity,teethwhitening,andpreventingplaque.
In spite of the marginally growing denture products category, GlaxoSmithKline
performs well in the category in 2012 and will continue to do so during the forecast
periodprovidedthemarketercontinuestointroducenewproducts.
Inthegrowingbatterypoweredtoothbrushesmarket,themarketerlosesoutonsales
and growth as a result of the incapacity to offer such advanced products and the
absenceofinnovationwithnewvariantsinthecategory.
Unless the marketer innovates with the introduction of new variants in the tooth
whiteningproductscategory,themarketersperformancewillcontinuetodeteriorate.
Themarketerwillcontinuetofacestiffcompetitionfromleadingmarketers,Colgate
Palmolive,Johnson&Johnson,Procter&Gamble,andUnilever.
Sales of MaxClarity facial treatments continue to decline in 2012 and the company
might pull out of the category on account of the regressive sales during the forecast
period.
4A162
GlaxoSmithKline
DollarsalesareexpectedtoincreaseataCAGRof1.5%to$439millionby2017from$407
millionin2012.
ToiletriesforGlaxoSmithKlinebyCategory,2012to2017
Category
CAGR,%
Toothpastes
2.4
Toothbrushes
2.1
COMPANYAVERAGE
1.6
Mouthwashes
0.9
Dentureproducts
0.6
Facialtreatments
(7.8)
5163
5164
GlaxoSmithKline
4A164
GUTHYRENKER
Table590:GuthyRenkersSalesofCosmeticsandToiletriesinthe
$Million
Category/brand
2011
FACIALTREATMENTS
Proactiv
2012
353
389
MeaningfulBeauty
65
82
PrincipalSecret
26
26
10
YouthfulEssence
11
Allother
21
13
476
526
60
112
SheerCover
40
39
VictoriaJackson
13
Total
53
42
15
31
Wen
12
26
TOTAL
616
737
XOut
Total
SHAMPOOS
Wen
FACEMAKEUP
CONDITIONERS
Wen
HAIRSTYLINGPRODUCTS
COMPANYOVERVIEW
GuthyRenker is one of the largest televisiondriven direct marketing companies in the

world.
Thecompanywasestablishedin1988byBillGuthyandGregRenker.
ItisheadquarteredatPalmDesert,CA.
IthasadministrativeofficesintheUnitedKingdom,Sweden,Germany,Finland,China,
Japan,Australia,andIndia.
5166
GuthyRenker
Themarketer,inassociationwiththirdpartydistributors,sellsitsproductsincountries
otherthantheonesmentionedabove.
Thecompanyhascloseto825employeesworldwideasof2012.
The company follows a directtoconsumer model with infomercials which entice
consumers to purchase the marketers products at low introductory prices, and a
subscriptionmodel.
Itsdistributionnetworkisspreadacross68countries.
The company pursues marketing opportunities through electronic retailing of various
productsthroughbroadcasttelevision,cableandsatellite,theInternet,telemarketing,
directmail,andretailchannels.
The marketers brands in the beauty business include Proactiv Solution, Wen, X Out,
NaturalAdvantage,MeaningfulBeauty,SheerCover,andPrincipalSecret.
In 2012, the company launches six ecommerce and mobile commerce sites for its
brands, Wen Haircare, X Out, Malibu Pilates, Proactiv, Proactiv+, and Meaningful
Beauty.
GuthyRenkers principal marketing activities involve the production of infomercials, half

hourtelevisionprogramsthatmarketvariousproducts.Italsomarketsitsproductsthrough
shortform,directresponsetelevisionspots,telemarketing,directmail,andalargeInternet
mall.
Thecompanysshowsaretelecastinmorethan60countriesonpopularchannelslike
CNBC,Lifetime,CourtTV,andFX.
Itspecializesinfourproductcategories,whichincludeentertainmentitems,weightloss
andfitness,healthandbeauty,andselfimprovement.
The company also sells GuthyRenker products through thirdparty distributors based
ineachcontinent,formingnewrelationshipseachyear.
GuthyRenkerisaprivatelyheldcompanyanddoesnotdiscloseitsfinancialinformationto
thepublic.
Estimatedtotalannualsalesforthecompanyin2012are$2.6billion.
Most of the sales of GuthyRenker in the cosmetics and toiletries market are in the facial
treatmentscategory.
GuthyRenkers sales have been growing at a compound annual growth rate (CAGR) of
13.7%since2007.
Thecompanyscosmeticsandtoiletriessalesgrowby19.6%toreach$737millionin2012,
4A166
GuthyRenker
Table591:GuthyRenkersCosmeticsand
ToiletriesSalesintheUnitedStates,2007to2012
Year
2007r
2008r
2009r
2010
2011
2012
$ Million
388
422
453
493
616
737
Change,%
8.8
7.3
8.8
24.9
19.6
rRestated.
GuthyRenkersProactivisthesecondlargestbrandinthefacialtreatmentscategory,with
Despite the sales increase, its business model of creating infomercials with celebrity
endorserscoulddraintheprofitabilityofthebrand,duetothehighcostofpurchasing
media, costs associated with infomercial production, and the cost of compensating
celebrities.
Sales grow due to several reasons including a number of new and young celebrity
endorsers, such as actresses Kaley Cuoco, Julianne Hough, and Naya Rivera; positive
endorsements as the best acne product by several magazines, and low introductory
pricehookingnewcustomers.
While no new products are launched during the year, the brand offers a cleansing
brushasagift.
Competing brands, such as MaxClarity, are discontinued during the year, causing
customerstoseekoutotherbrandssuchasProactiv.
Inthehaircareproductclass,salesofGuthyRenkerpostaformidablegrowthof108.8%to
reach$338millionin2012,from$162millionin2011.
ThesalesofWenshampoosgrow86.7%,upfrom$60millionin2011to$112millionin
2012.
Wenscategorysharegrowsfrom2.4%in2011to4.3%in2012.
Themarketercontinuestobenefitfromdirectlypresentingthebenefitsofitsproducts
to consumers via infomercials. Celebrity Alyssa Milano promotes the brand in the
infomercials.
Moreover, Wen is positioned as a fiveinone product, replacing shampoos, daily
conditioner, detanglers, deep conditioner, and leavein conditioner. These factors
contributetoitshighprice.
Value sales are high because Wen cleansing conditioner costs about $40.00 a bottle,
andtheinstructionsmentionthatonemustuseagreatdealmoreoftheproductthan
a normal shampoo. Customers ordering the product are enrolled in a subscription,
with automatic charges made to their credit cards and product shipped to them at
regular intervals. Customers are usually charged $30.00 per month after the initial
purchase.
The sales of GuthyRenker conditioners grow 106.7% to $31million in 2012, from
$15millionin2011.
Inthehairstylingproductsandsprayscategory,salesgrow116.7%from$12millionin
5167
5168
GuthyRenker
In2012,thefacemakeupcategorydeclines20.8%from$53millionin2011to$42millionin
2012.
In2012,GuthyRenkeradoptstheuseofaMegaAirlessneutralandairlessdispensing
solutionforitsMeaningfulbeautyCindyCrawfordCrmeSerum.
The company claims that this new dispensing solution is vacuumtested inline and
delivers precision amounts, quickpriming, and a 360 degrees operation without any
dripping,clogging,drying,oranykindofcontaminationtotheproduct.
RECENTDEVELOPMENTS
Newproducts
In 2012, GuthyRenker introduces the X Out acne line consisting of a washin delivery
systemwithbenzoylperoxide(8.5%)andmicrobeadstohelpexfoliatethedeadskincell.
ThisproductisuniquetoGuthyRenkerinthatitisnotsoldthroughinfomercials,but
only sold online. Furthermore X Out is targeted specifically at males,and, hence, has
onlyoneproduct.
MARKETINGACTIVITY
GuthyRenker continues to use infomercials and advertising as an important marketing

mediumtopromoteitsbrands,especiallyProactiv.
In 2012, GuthyRenker enters into an agreement with actress Kaley Cuoco to be the
companys newest spokesperson. Kaley Cuoco features in the television advertising
campaignforthemarketerthatcomesonairinthefallof2012.Sheadvertisesforher
favorite Proactiv products including the 3Step System, Mini Maintenance System
TravelKit,RefiningMask,andDailyProtectionPlusSunscreenBroadSpectrum.
Other popular celebrity spokesmodels for the marketer include actresses Julianne
Haugh, and Naya Rivera. These actresses promote the companys products through
televisionspots,digitalmedia,andpromotionsduring2012.
Free gifts are offered with the purchase of a Proactiv starter kit, and free shipping is
alwaysofferedforonlinepurchases.
The brand continues to run directresponse advertisements as freestanding inserts
(FSIs) in weekend newspapers throughout the country, encouraging prospective
customerstoeithermailinacouponorcalltopurchasetheProactivSystem.
TheProactivkiosksinmajormallsaroundthecountryevolvefromamannedkiosktoa
vendingmachine.
Measured advertising expenditures for Proactiv are $304.2million during 2012, up
23.0%from$247.3millionduring2011.
4A168
GuthyRenker
The company also utilizes shortform and Direct Response Television (DRTV) spots to
promoteitsbrands.
GuthyRenkersleadingbrand,Proactiv,usesDRTVasitsprimarymarketingmedium.
ThemarketerusesDRTVinconjunctionwithinfomercialstoprovidebeforeandafter
demonstrations and testimonials, which are difficult to express clearly via traditional
televisionadvertising.
The company increasingly sponsors and host events in an attempt to promote awareness
aboutthecompany.
GuthyRenker sponsors the 2012 Palm Springs Strength & Human Performance Expo,
featuringthreecompetitiveeventsincludingUSAWeightliftingsannual2012American
Open, 2013 World Youth Team Trials, and the Outlaw Open. The Expo features
exhibitors, renowned speakers, demonstrations, and activities pertaining to strength
and extreme human physical performance with keynotes from prominent speakers
suchastwotimeOlympianKendrickFarrisandOlympianandfitnessexpertCaraHeads.
In2012,GuthyRenkersWenpartnerswiththe2012MissAmericaOrganization.Inthe
days that lead up to the 2012 Miss America Pageant, celebrity stylist Chaz Dean and
creatorofWenHairCareinteractswithcontestantsandstylestheirhairshowingthem
varioushairstyles,forthemtoexperiencetheadvantagesofusingthebrandsproducts.
The brand also hosts a live stream conversation with Chaz Dean for fans to get an
insidersperspectiveonthepageant.
GuthyRenker increasingly capitalizes on social media channels such as Facebook and

YouTube.
Unlike other marketers, social media platforms play an important role for Guthy
Renkerduethenatureofthemarketersdirectsellingbusinessmodel.
Themarketerprimarilyusessocialmediaplatformstodevelopapersonalrelationship
with its consumers and fans and provides them a platform to share their product
experiences,reviews,andseekanswers.
In 2012, Proactiv joins the bandwagon of other beauty brands by creating its own
channel on YouTube. The brand promotes its YouTube channel by advertising on its
otherpopularsocialmedianetworkchannel,Facebookbyaskingconsumersandfans
tosubscribetothechannel.ThebrandsYouTubechannelfeaturesinsiderstories,fan
reviews, Proactiv success stories, behindthescenes of advertisement shoots, videos,
andadvertisementsofthebrand.
The brands YouTube channel also allows consumers to chat with Proactiv
representativestoclarifytheirdoubtsontheproduct.
Other social media networks that the marketer uses to promote its products include
FacebookandTwitter.
The companys 60day money back guarantee is very popular with its customers. The
company claims to refund the money within 60 days of receipt, if the consumer is not
completelysatisfiedwiththeproduct.
The companys practice of selling product subscriptions leads to higher sales per
consumer. Purchases of many GuthyRenker products are automatically billed and
shipped monthly after the first purchase, until the customer cancels. The 60day
guarantee also leads to unwanted purchases not being credited back if the customer
doesnotsendtheproductbackwithinthe60days.
5169
5170
GuthyRenker
The company has an extensive website that lists all its directresponse brands along with
theirdescriptions,andprovidesopportunitiestopurchaseproductsonline.
Each individual brands website is structured in a similar fashion to its infomercial,
showcasingbeforeandafterphotos,celebrityendorsers,andcustomertestimonials.
Many of the brands allow consumers to see video clips on its website. They also
provideaweeksscheduleforinfomercialprograms.
OUTLOOK
GuthyRenkerscosmeticsandtoiletriesbusinessisexpectedtogrowatahealthyCAGRof
6.6%duringtheforecastperiod,2012to2017.
GuthyRenkerisforecasttopoststronggrowthinitscosmeticsandtoiletriesbusiness
Itsproductsareexpectedtocontinuetoenjoystrongbrandloyaltyduringtheforecast
period;however,thecompanywillfacestrictcompetitionfromothermarketers,direct
andotherwise.
AlthoughGuthyRenkerhasbeenveryinnovativeinitsproductofferingsandbusiness
model,ithaspavedthewayforothercompaniestostepinandcapturemarketshare
withlowerpricedcompetingproducts,therebyrestrictingitsfurthergrowth.
Thecompanyislikelytoincreaseitsadvertisingexpenditureshelpingitgainsalesover
otherdirectmarketerswhohavealimitedadvertisingbudget.However,thehighcost
ofmediafortheinfomercials,theproductioncostsoftheinfomercials,andthecostof
thecelebrityspokesmodelscouldhaveanegativeimpactonthecompanyssalesinthe
furureiftheydonotcontinuetogrowtheirsalesatthedesiredCAGR.
The company is testing other distribution models which may prove to be more
profitable.
Thefacialtreatmentscategorywillremainthehighestrevenuegeneratorforthecompany
In early 2012, the company launches X Out, an antiacne product that claims to fight
acneandbanishexistingpimples.Thecompanywilllikelylaunchmoreacneproductsin
theforecastperiodtosupportitssales,eitherinexistingbrandsorinnewones.This
segmenthasbeensuccessfulforGuthyRenker.
The company is likely to continue to hire celebrities to endorse its products, and to
promote the company, however, on a lower scale than before as it focuses on
promoting and launching its brands through social media channels, banner
advertisements, and retail stores in the future. Its profitability is too low to allow
continuedrelianceoncelebrityendorsedinfomercials.
Thecompanywillcontinuetopromoteitsnewintroductionsacrossvariouscategories
throughinfomercialsandotherdirectresponseadvertisementsinthefuture.
Furthermore,thecompanystestswithsellingthroughretailerswilllikelybeexpanded.
Meaningful Beautys foray into Sephora in JCPenney stores is probably just the
beginningofitsexplorationofdifferentsalesmodels.
4A170
GuthyRenker
The hair care product class is also projected to post strong growth of 5.2% during the
forecastperiod.
Wenwillcontinuetoattractnewconsumersandretaintheoldonesastheygetlocked
intheirsubscriptionplans.
ThecompanyislikelytoexplorewithmorevariantsintheWenproductlinebyoffering
advancedtechnology,combinedwithnaturalingredients.
Wen is sold in Sephora stores, widening its exposure but reducing the continual
revenuestreamthatthedirectmodelleverages.Thebrandwilllikelybesoldthrough
otherchannelsaswell,duringtheforecastperiod.
Dollarsalesareexpectedtoreachapproximately$1,013millionatthemanufacturerslevel
by2017,upataCAGRof6.6%from$737millionin2012.
ToiletriesforGuthyRenkerbyCategory,2012to2017
Category
CAGR,%
Facialtreatments
7.4
COMPANYAVERAGE
6.6
6.1
Shampoos
5.3
Conditioners
4.2
Facemakeup
1.4
5171
5172
GuthyRenker
4A172
HELENOFTROY
Table593:HelenofTroysSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
SHAMPOOS
PertPlusr
55
50
Infusium23
14
12
Totalr
69
62
Sure
35
33
Brut
14
14
Total
49
47
17
14
18
15
Condition
Vitalis
FinalNet
Total
SeaBreeze
TOTALr
rRestated.
160
147
CONDITIONERS
Infusium23
Condition
Total
FRAGRANCESFORMEN
Brut
FACIALTREATMENTS
2012
5174
HelenofTroy
COMPANYOVERVIEW
ThecompanywasincorporatedasHelenofTroyCorporationin1968inTexas;however,in
1994itwasreincorporatedasHelenofTroyLimited.
HeadquarteredinElPaso,TX,HelenofTroyhasofficesandwarehousefacilitiesaround
theworld.
ThecompanyisapubliclimitedcompanyandislistedontheNASDAQundertheticker
symbolHELE.
AsofFebruary,2013,thecompanyemploysapproximately1,458full meemployees
worldwide.Thecompanyalsoemploysparttime,temporary,andseasonalemployees
perthebusinessrequirements.
Thecompanymarketsitsproductsinapproximately80countriesacrosstheworld.
The company has three business segments namely Personal Care, Housewares, and
Healthcare/HomeEnvironment.
The Personal Care segment includes electric hair care, beauty care, and wellness
appliances; grooming tools and accessories; and liquid, solid, and powderbased
personalcareandgroomingproducts.
The Houseware segments range of products include food preparation and storage,
cleaning,organization,andbabyandtoddlercareproducts.
The Healthcare/Home Environment business comprises health care devices, such as
thermometers, blood pressure monitors, humidifiers, and heating pads; small home
appliances, such as air purifiers, portable heaters, fans, and bug zappers; and water
filtrationsystems.
The companys distribution network comprises mass merchandisers, drug stores,

warehouseclubs,catalogs,grocerystores,specialtystores,andecommerceretailers.
In addition to the above, the Personal Care segment also sells extensively through
wholesalersandsupplyretailers.
IntheHealthcare/HomeEnvironmentbusiness,HelenofTroyownstrademarksforits
SoftHeat, Protec, SmartTemp, PUR, Duracraft, Stinger, and Nosquito brands and has
licensedtrademarksforBraun,Vicks,Honeywell,andFebreze.
FortheHealthcare/HomeEnvironmentbusinesssegment,thedistributionnetworkalso
comprisesmedicaldistributorsandhomeimprovementstores.
In the Personal Care segment, the marketer owns trademarks for PRO Beauty Tools,
Karina,HOTTools,GoldNHot,Carel,Comare,ShearTechnology,DCNL,Brut,Infusium
23, Pert Plus, Sure, Ammens, Ogilvie, and Final Net; and has licensed trademarks for
Revlon,VidalSassoon,Dr.Scholls,Scholl,Toni&Guy,BedHead,andSeaBreeze.
FortheHousewaresbusiness,themarketerownstrademarksforitsOXO,GoodGrips,
SoftWorks,OXOSteel,andOXOtotbrands.
4A174
HelenofTroy
TotalsalesforHelenofTroyare$1,181.7millionin2012,up52.1%from$777.0millionin
2011.
Thecompanyssaleshavegrownatacompoundannualgrowthrate(CAGR)of13.2%
since2007.
The company has performed exceptionally well in 2012 as compared to any of the
previousfiveyears.
Table594:HelenofTroysGlobalCorporateSales,
2007to2012
Yeara
$Million
Change,%
2007
634.9
7.6
2008
652.5
2.7
2009
622.7
(4.6)
2010
647.6
3.9
2011
777.0
20.0
2012
1,181.7
52.1
aFiscalyearendingisFebruary.
Thecompanyspersonalcaresegmentcurrentlyoffershaircareproducts,suchasliquidhair
styling products, treatments, shampoos, conditioners; liquid or medicated skin care
products; fragrances; deodorants and antiperspirants; hair care appliances such as curling
irons, straightening irons, hot air brushes, handheld dryers, hard and softbonnet hair
dryers,hairsetters,hairclippersandtrimmers,hairbrushes,hairstylingimplements,and
decorativehairaccessories;facialcareappliances;footcareappliances;andhandheldand
lightedmirrors.
Net sales in the personal care segment marginally increase by 1.1% to $496.6million in
fiscalyear2012,comparedto$491.2millioninfiscalyear2011.
Table595:HelenofTroysGlobalCorporateSalesby
ProductCategory,2012
Category
%Oftotal
Personalcare
42.0
Healthcare/HomeEnvironment
37.9
Housewares
20.1
Total
100.0
5175
5176
HelenofTroy
The U.S. market is the largest sales contributor, with 76.7% of the companys business
comingfromtheregion.
Table596:HelenofTroysGlobalCorporateSalesbyCountry,2011to2012
$Million
%Oftotal
Region
2011
2012
UnitedStates
619.4
906.8
79.7
76.7
Europeandother
78.7
155.6
10.1
13.2
Canada
40.7
69.4
5.2
5.9
LatinAmerica
38.2
49.8
4.9
4.2
777.0
1181.7
100.0
100.0
Total
2011
2012
Sales for Helen of Troy in the U.S. cosmetics and toiletries market decline 8.1% from
Since2007,salesofHelenofTroyhavebeendecliningatacompoundannualgrowthrate
(CAGR)of6.7%.
Table597:HelenofTroysCosmeticsandToiletries
Year
$Millionr
Change,%
2007
208
2008
200
(3.8)
2009
175
(12.5)
2010
168
(4.0)
2011
160
(4.8)
2012
147
(8.1)
rRestated.
4A176
HelenofTroy
Shampoos is the largest product category for the company, accounting for 42.2% of the
companyscosmeticsandtoiletriessalesin2012.
Salesoftheshampooscategorydecline10.1%from$69millionin2011to$62million
in2012.
ThecompanyisrepresentedinthecategorybyitsPertPlusandInfusium23brands.
The sales of Pert Plus decline 9.1% to $50million in 2012, down from $55million in
2011.
PertPlusaccountsfor34.0%ofcompanyssalesinthecosmeticsandtoiletriesindustry
intheUnitedStatesin2012.
SalesofInfusium23declineby14.3%,from$14millionin2011to$12millionin2012.
A dearth innew product activity from the company negatively affects the marketers
salesintheshampooscategory.
Deodorants and antiperspirants is the secondlargest category, accounting for 32.0% of

HelenofTroyssalesintheU.Scosmeticsandtoiletriesmarketin2012.
Thesalesofthecompanyinthedeodorantsandantiperspirantscategorydecline4.1%
Lackofnewproductactivity,limitedmarketingsupport,andtheabsenceininnovation
haveanegativeimpactonthesalesofthecompanyinthecategory.
ThecompanyisrepresentedinthecategorywithitsSureandBrutbrands.
SalesofSuredeclineby5.7%,from$35millionin2011to$33millionin2012.
However,thesalesofBrutremainstableat$14millionin2012,flatfrom2011levels.
Brutssaleshavebeenstableat$14millionsince2009.
Conditioners are the thirdlargest category for the company, generating 10.2% of the
companyssalesin2012.
Salesofthemarketerinthecategorydecline16.7%to$15millionin2012,downfrom
$18millionin2011.
ThemarketercompetesintheconditionerscategorywithitsInfusium23andCondition
brands.
SalesofInfusium23decline17.6%from$17millionin2011to$14millionin2012.
Infusium 23 represents 93.3% of the marketers sales in the conditioners category in
2012.
Thehairstylingproductsandsprayscategoryisthefourthlargestcategoryforthemarketer
withsalesat$8millionin2012.Salesdecline11.1%from$9millionin2011.
Thecategorygenerates5.4%ofthecompanyssalesin2012,downfrom5.6%in2011.
ConditionandVitalisarethelargestbrandsforthecompanywitheachhavingsalesat
$3millionin2012.
The sales of Vitalis remain stagnant at $3million in 2012, flat from 2011 levels;
howeverthesalesofVitalisdecline25.0%from$4millionin2011to$3millionin2012.
SalesofHelenofTroyinthefragrancesformencategoryremainstableat$8millionin2012,
flatfrom2011levels.
5177
5178
HelenofTroy
HelenofTroyssalesinthefacialtreatmentscategorycontinuestoexperienceflatsalesat
$7millionin2012.
Thecompanycompletetheintegrationofitsacquiredbrandsin2011,andwillfocuson
addingnewvariantstoitsexistinglineinthefuture.
RECENTDEVELOPMENTS
Mergers&acquisitions
Therearenoacquisitionsin2012.
Otherdevelopments
Thecompanyhasenteredintoanagreementtopurchase84acresoflandinOliveBranchin
Mississippi.
The land will be used for the purpose of constructing a 1.3million square foot
distributioncenter.
The distribution center is expected to cost an approximate $37million and will be
operationalfromthethirdquarterof2014.
Newproducts
Therearenonotablenewproductlaunchesin2012.
MARKETINGACTIVITY
In 2012, Helen of Troys traceable media expenditures (TME) total $12.1million, up 5.2%
MajorityofthemarketersTMEat$11.3millionisspentonthehaircareproductclass.
Infusium23brandthemostTMEat$6.5millionin2012.
PertPlusreceivesaTMEof$4.8millionin2012.
Magazineadvertisingisthemostpreferredmarketingmediumadoptedbythemarketerto
promoteitsproducts.
Thecompanypromotesitsproductsthroughtrademagazinesandconsumermagazines
suchasLuckyandGlamour.
In 2012, magazine advertisements and television advertisements receive a TME of
approximately$9millionand$2.8million,respectively.
4A178
HelenofTroy
Infusium23isthesponsoroftheU.S.SynchronizedSwimmingNationalTeamatthe2012
SummerOlympicsheldinLondon.
The brand is holding sweepstakes on its Facebook page. However, participants are
supposedtoliketheFacebookpageinordertoenterthesweepstakes.TheHonorary
TeamCaptainandaguestwillgetachancetoattendtheduetsynchronizedswimming
event,roundtripticketsfromNewYorksJFKtoLondonsHeathrowAirport,fivenight
stayinLondon,aVIPprizepack,andachancetomeetandgreettheteam.
PertPlusandBrutsponsortheWarriorDashinWindham,NYinAugust,2012.
TheWarriorDashisa5Kracethatteststheparticipantsmentalandphysicalstrength
through grueling obstacles. Pert Plus gives out shampoo samples to the participants,
whoaredirtyfromthemuddypit,tocleanupinthePertPlusSudzZonebeforethey
reachthepostracefestivalarea.
In2012,HelenofTroypromotesitsBrutrangeofproductswithanewcampaignsatirizing
machismo.
The digital and television based campaign, similar to its 2011 campaign is humorous
andistargetedatyoungmen.
The campaign includes two 15second spots showcasing Brut being the Essence of
Man.
Thefirst15secondadvertisementfeaturesamangettingreadyforanightoutwithhis
wifewholeavesthebathroomlookingsliminablackeveningdressandassoonasthe
manspraysontheBrutSplashOn,thewifeemergesasapregnantwomenandsodo
thedaschundandthegoldfish.
ThesecondadvertisementfeaturesamanapplyingtheBrutdeodorantwhilewatching
theweathernewsontelevision.Assoonasthemanappliesthedeodorant,themale
weatherforecasterturnsintoabikinicladblondewoman.
BrutusestheWarriorDashasameanstoshowcasethebrandssloganLetYourMan
Outbygivingparticipantsachancetowinaweekendgetawayworth$1,000.
Socialnetworkingsites,suchasFacebook,Twitter,andYouTube,continuetobeanintegral
partofthemarketersmarketingstrategy.However,themarketerusesanantifeelgood
strategyinthehopetogoviralasOldSpicehas.
Bruts Facebook application, called Mantervention, features a 5minute video in
which a man berates account holders and some of their posts, criticizing them for
participatingonFacebook.
This happens with the help of the profile access feature on Facebook, which allows
everyapplicationtoseekpermissiontohaveaccessto,fromtheaccountholder.
5179
5180
HelenofTroy
OUTLOOK
SalesofHelenofTroyintheU.S.cosmeticsandtoiletriesindustryisprojectedtodeclineat
aCAGRof2.9%intheforecastperiod,2012to2017.
The company has been investing a great deal in acquiring brands in the industry, and
focusingontheUnitedStatesasaprimarymarket.
HelenofTroycontinuestofocusondevelopingitsbusinessthatfalloutsidethescope
ofthisreportsresearch.Thecompanyisbiginthehaircaremarketwithspecialization
inthehaircareappliancesmarketwhichisnotapartofthisreport.
The company has not done enough to develop and support the sales of its U.S.
cosmeticsandtoiletriesbrands.
Duringtheforecastperiod,theshampooscategorywillcontinuetogeneratethemostsales
forthecompanyintheU.S.cosmeticsandtoiletriesindustry.
Inthedeodorantsandantiperspirantscategory,theSurebrandwillcontinuetodecline
until and unless the marketer makes innovations with new product introductions,
packaginganddesign,andmarketinginitiatives.
However,theBrutbrandwillcontinuetopoststablesalesoverthenextfiveyearsdue
toconsumerloyaltytowardsthebrand.
HelenofTroyshouldemphasizeonitsmarketingstrategytopromoteitsbrandsandnewly
introducedproductsduringtheforecastperiod,ending2017.
Socialmedianetworks,suchasFacebook,Twitter,andYouTube,willcontinuetobean
integral part of the marketers marketing campaign as its target audience incudes
youngconsumerswhoareactiveonsuchmedia.
Additionally social media is of great importance to the marketer due to its limited
marketingbudget.
The company will continue to utilize events and campaigns in the deodorants and
antiperspirantscategorytocompetewithothermalecentricbrandssuchasOldSpice,
Axe,andGillette.
Themarketerisexpectedtoincreaseitsadvertisingspendandpromotionalactivitesin
thehaircareproductclass.
4A180
HelenofTroy
HelenofTroywillbeabletogathersomegrowthifitseeksoutthefollowingkeythings.
In order to broaden its growth opportunities, the company should seek to acquire
brandsthathaverelevancetothecompanyspersonalcarebusinessinthecosmetics
andtoiletriesindustry.Incaseswhereacquisitionisnotfeasible,thecompanyshould
lookforlicensedbrandswithsubstantialbrandequityinordertocreatesynergieswith
themarketersexistingbrands.
Thecompanyshouldlooktoexpanditsexistinglineofproductswithnew,innovative,
and technologically advanced products that will help drive sales during the forecast
periodending2017.
Expansioninthedistributionnetworkwillalsoaidinthegrowthofthecompanyssales.
The companys strategy of reducing the time difference between developing and
introducing new products to meet the changing needs of the consumers in the fast
evolvingcosmeticsandtoiletriesmarketwillalsohaveapositiveeffectonthesalesof
thecompany.
However, the lack of constructive efforts to support its cosmetics and toiletries sales
willlikelyputadentinthesalesgrowthprospectofthemarketerduringthenextfive
years.
HelenofTroyscosmeticsandtoiletriessalesareprojectedtodeclineataCAGRof2.9%to
$127millionin2017,downfrom$147millionin2012.
ToiletriesforHelenofTroybyCategory,2012to2017
Category
CAGR,%
Fragrancesformen
(2.2)
Conditioners
(2.8)
COMPANYAVERAGE
(2.9)
Facialtreatments
(3.0)
Shampoos
(3.1)
(9.0)
5181
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HelenofTroy
4A182
JOHNSON&JOHNSON
Table5107:Johnson&JohnsonsSalesofCosmeticsand
ToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
FACIALTREATMENTS
2012
Neutrogena
330
347
Clean&Clear
108
111
Aveeno
84
81
RoC
52
52
579
596
336
340
10
10
Listermint
Rembrandt
350
354
112
120
Lubridermr
60
63
Neutrogena
26
25
207
217
158
169
20
20
178
189
161
157
26
28
187
185
Purpose
Totalr
MOUTHWASHES
Listerine
Plax
Total
HANDANDBODYLOTIONS
Aveenor
Johnsons
Totalr
SUNCAREPRODUCTS
Neutrogena
Aveeno
Total
BABYCAREPRODUCTS
Johnsons
Aveeno
Total
(Continued)
5184
Johnson&Johnson
$Million
Category/brand
2011
2012
Aveeno
73
71
Neutrogenar
40
43
Johnson'sSoftwash
Johnson'sKids
115
115
Neutrogena
53
54
JohnsonsBaby/KidsShampoo
37
35
Aveenor
17
19
NizoralAD
113
113
72
75
Neutrogena
31
32
Aveenor
15
16
Johnsons
55
57
Rembrandt
21
22
Listeriner
28
29
Totalr
SHAMPOOS
Totalr
FACEMAKEUP
Neutrogena
CONDITIONERS
Totalr
TOOTHPASTES
Totalr
NeutrogenaMen
22
23
Aveeno
Neosporin
Neutrogena
18
18
Total
(Continued)
4A184
Johnson&Johnson
$Million
Category/brand
2011
SHAVINGPRODUCTS
2012
11
10
17
16
EYEMAKEUP
Neutrogena
15
15
13
Aveeno
NeutrogenaMen
Total
Neutrogena
Rembrandt
ListerineWhitening
Total
Duke
TOTALr
rRestated.
1,979
2,020
COMPANYOVERVIEW
Johnson&Johnsonisamongtheworldslargestmanufacturersofhealthcareproductsfor
the consumer, pharmaceutical, and professional markets. It is headquartered in New
Brunswick,NJ.
The company operates in 60 countries through 250 operating companies, and its
productsaresoldinvirtuallyallcountries.
Asof2012,thecompanyemploysapproximately117,900people.
Johnson&Johnsonoperatesthroughthreebusinesssegments:
The Consumer segment primarily markets skin care products, hair care products, oral
careproducts,babycareproducts,sanitaryprotectionproducts,woundcareproducts,
andnonprescriptiondrugs.
TheMedicalDevicesandDiagnosticssegmentencompassesabroadrangeofproducts
used by or under the direction of health care professionals, including surgical and
medicalsupplies.
The Pharmaceutical segment distributes prescription drugs for use by health care
professionalsandthegeneralpublic.
5185
5186
Johnson&Johnson
Johnson& Johnsons corporate sales total grow 3.4% to $67,224million in 2012, up from
In2012,Johnson&Johnsonsnetprofitgrows12.2%to$10,853million,from$9,672million
in2011.
In the fourthquarter net profits rise to $2.6 billion from $218 million for the same
period in 2011. In its fourthquarter, Johnson & Johnson includes sales of recently
acquiredcompany,Synthes.
Increaseinsalesofprescriptiondrugsandmedicaldevicesalsoresultinincreaseofnet
profitsforthecompany.
Corporatesalesforthecompanyhaveincreasedatacompoundannualgrowthrate(CAGR)
of1.9%peryearsince2007.
Table5108:Johnson&JohnsonsGlobalCorporateSales,2007to2012
$Million
Year
Sales
Netprofit
2007
61,095
10,576
2008
63,747
2009
Marginonsales
Returnonequity
17.3
24.4
12,949
20.3
30.5
61,897
12,266
19.8
24.2
2010
61,587
13,334
21.7
23.6
2011
65,030
9,672
14.9
16.9
2012
67,224
10,853
16.1
16.7
The United States continues to be the singlelargest market for Johnson& Johnson, with
sales of $29,830 million in 2012 or 44.4% of sales, up from $28,908 million and 44.4% of
salesin2011.
Internationalsalescontinuetogainshare,andrepresent55.6%ofthecompanystotalsales,
at$37,394millionin2012,upfrom$36,122millionand55.6%in2011.
TheConsumersegmentaccountsfor21.5%ofthetotalsalesin2012.
Table5109:Johnson&JohnsonsGlobalSalesbyBusinessSegment,2011and2012
Segment
$Million
%Ofsales
%Ofoperatingprofit
2011
2012
2011
2012
2011
2012
Medicaldevicesand
diagnostics
25,779
27,426
39.6
40.8
38.3
48.1
Pharmaceutical
24,368
25,351
37.5
37.7
46.5
40.6
Consumer
14,883
14,447
22.9
21.5
15.2
11.3
Total
65,030
67,224
100.0
100.0
100.0
100.0
4A186
Johnson&Johnson
SalesforthecompanysConsumersegmentdeclineby2.9%from$14,883millionin2011to
Table5110:Johnson&JohnsonsSalesbyConsumerSegment,2007to2012
$Million
Year
Consumer
Allother
2007
14,493
2008
%Oftotal
Total
Consumer
Allother
Total
46,602
61,095
23.7
76.3
100
16,054
47,693
63,747
25.2
74.8
100
2009
15,803
46,094
61,897
25.5
74.5
100
2010
14,590
46,637
61,587
24.3
75.7
100
2011
14,883
50,147
65,030
22.9
77.1
100
2012
14,447
52,777
67,224
21.5
78.5
100
Johnson&JohnsonsU.S.salesofcosmeticsandtoiletriesgrowby2.1%to$2,020millionin
2012from$1,979millionin2011.
Johnson&JohnsonssaleshaveincreasedataCAGRof2.1%since2007.
Table5111:Johnson&JohnsonsCosmeticsand
ToiletriesSales,2007to2012
Year
$Million
Change,%
2007r
1,825
2008r
1,885
3.3
2009r
1,901
0.8
2010r
1,945
2.3
2011r
1,979
1.7
2012
2,020
2.1
rRestated.
5187
5188
Johnson&Johnson
Johnson&Johnsonslargestproductcategory,facialtreatments,accountsfor29.5%ofthe
companystotalcosmeticsandtoiletriessalesfortheyear2012.
Categorysalesareup2.9%from$579millionin2011to$596millionin2012.
Neutrogenaisthecompanysleadingbrandinthecategory.
The brand is the secondlargest brand in the mass segment with $347million in
manufacturerssalesin2012,up5.2%from$330millionin2011.
OneofthemajorgrowthcatalystsforNeutrogenaistheNaturalslinewhichissaidtobe
97% naturallyderived and contains antioxidants. The line is extended in 2012 with
MultiVitamin Nourishing Moisturizer which is a daily lotion that replenishes essential
nutrients.
In 2012, Neutrogena extends its acne line with the launch of AllInOne Acne Control
Treatmentwhichthecompanypromotesasamultifunctionproductthatisabletofade
acnescarswhilecontrollingpresentandpreventingfuturebreakouts.
Advertising expenditures for Neutrogenas facial treatment brands are approximately
$14.0millionduring2012,adramaticdeclinefrom$88.3millionduring2011.
Thecompanysmouthwashescategoryisthesecondlargestforthecompany,contributing
17.5%tothetotalsales.
Johnson&Johnsonremainstheleadingmarketerinthemouthwashescategoryin2012,
withtotalsalesof$354million,up1.1%from$350millionin2011.In2012,themarket
sharedecreasesto44.3%,from44.8%in2011.
Listerineisthecompanyslargestmouthwashbrandandisalsothepreeminentleader
inthiscategory.
Listerines sales grow 1.2% from $336 million to $340 million in 2012. Growth of the
Listerine brand is supported by the strong performance of its alcoholfree variants:
ListerineZeroandTotalCare.
The company continues to stress on the importance of using Listerine twice a day in
ordertohave24hourprotection.
IncreasedmarketingandnewproductactivitysupportthesalesoftheListerinebrandin
2012.
SalesofPlaxremainat$10millioneachin2011and2012duetoalackofpromotional
supportandexcitementforthebrand.
Sales of Listermint and Rembrandt remain low at a rounded $2 million each in 2012,
sameas2011levels.
Hand and body lotions is the thirdlargest product category for Johnson & Johnson,
accountingfor10.7%ofthecompanystotalsales.
Johnson & Johnson is the secondlargest marketer in the hand and body lotions
category,withsalesat$217millionin2012.
Salesgrow4.8%from$207millionin2011.
Johnson&Johnsonsmarketsharegrowsfrom9.2%in2011to9.5%in2012.
The marketer competes in the category with its Aveeno, Neutrogena, Lubriderm,
Johnsons,andRoCbrands.
4A188
Johnson&Johnson
Aveenoisthelargestbrandforthemarketerinthecategorywithsalesat$120millionin
2012,up7.1%from$112millionin2011.Aveenosnaturalpositioninginthemarketis
the primary reason behind the brands growth as more consumers choose naturally
positionedhandandbodylotionsovertheconventionalhandandbodylotions.
Aveenorepresents55.3%ofthemarketerstotalsalesinthecategoryin2012.
Thebrandclaimstoenrichitsproductformulationswithactivenaturalingredients.
Some of the commonly found natural ingredients in Aveenos hand and body lotions
include blueberry, goji berries, grapefruit, rosemary, vanilla, cocoa butter, and shea
butter.
The marketers secondlargest brand in the category is Lubriderm, with sales at
$63millionin2012,up5.0%from$60millionin2011.Growthin2012isdrivenbythe
formulation changes that the marketer introduces to its Lubriderm line in late 2011,
effectsofwhichareevidentinits2012sales.
The brand represents a 29.0% category share in Johnson & Johnsons total hand and
bodylotionssales.
Lubridermpositionsitselfasadermatologistdevelopedbrandwithfourproductlines:
DailyMoisture,AdvancedTherapy,IntenseSkinRepair,andSoothingRelief.
Sales of Johnson & Johnsons thirdleading brand, Neutrogena, decline 3.8% from
$26millionin2011to$25millionin2012.Neutrogenassalesdeclineasaresultofthe
lack of new and innovative product activity from the brand in the category in 2012.
Additionally, the brands offerings in the category are limited in comparison to other
brands offerings. The more successful competitors are continuously evolving their
brandstooffernewandinnovativeproductswithadditionalbenefitsandfragrancesin
ordertokeepconsumersengaged.
Asaresultofthesalesdeclinein2012,NeutrogenasshareinJohnson&Johnsonssales
inthehandandbodylotionscategorydeclinefrom12.6%in2011to11.5%in2012.
Johnson&Johnsoncontinuestobethesingledominantmarketerinthebabycareproducts
categoryin2012,withitsJohnsonsBabyandAveenobrands.
In 2012, the manufacturers sales decline by 1.1% from $187 million in 2011 to $185
million.
2013.
JohnsonsBabycontinuestodominatethecategorywithsalesat$157millionin2012,
down2.5%from$161millionin2011.Thedecliningsalesisattributedtothelackofnew
product activity, dearth of innovation, and the negative news surrounding its product
recallsin2012.
Johnsons Baby posts declining sales in the baby bath and baby lotions segments and
stagnantsalesinthebabyoilsandbabypowderssegments.
Johnson&Johnsonsotherbrandinthecategory,Aveeno,showssalesgrowthof7.7%,
from$26millionin2011to$28millionin2012.Thehealthygrowthisattributedtoits
goodperformanceinboththebabybathandthebabylotionssegments,throughwhich
itcompetesinthebabycareproductscategory.
5189
5190
Johnson&Johnson
AveenosOrganicHarvestline,launchedin2011,comprisingthreeSKUs,isdiscontinued
in2012onaccountoflosingitsU.S.DepartmentofAgriculture(USDA)NationalOrganic
Program (NOP) certification status as a result of its products containing an ingredient
thatisnotontheUSDAsNationalList.AlthoughtheOrganicHarvestlineisnotavailable
onthecompanysofficialwebsite,itcanstillbefoundoncertainonlineportalsandon
theshelvesofafewretailers.
In August 2012, Aveeno voluntary recalls its baby Calming Comfort Lotion, after the
FDAstestsonasampleproductshowexceededspecifiedquantitiesofcommonbacteria.
However,theproductisrelaunchedin2012afterprecautionarymeasurestakenbythe
company.
Johnson & Johnson slides below Merck to become the thirdleading marketer in the sun
careproductscategoryin2012.
Manufacturerssalestotal$189millionin2012,up6.2%from$178millionin2011.
Thecompanysshareslidebyamere0.1%from18.1%in2011to18.0%in2012.
Johnson&Johnsonisrepresentedbytwomajorbrandsinthecategory:Neutrogenaand
Aveeno.
Neutrogenaisthethirdleadingbrandinthecategorywithsalesat$169millionin2012,
withahealthygrowthof7.0%from$158millionin2011.
Thebrandsgrowthin2012ismainlyattributedtoitsexpandingdistributionnetwork,
good reputation in the market, and increasing marketing support from the parent
company,Johnson&Johnson.
The companys latest product line, the Wet Skin line comprising six SKUs, launched in
2011continuestodowellin2012.
The brand also offers an array of multifunctional products offering benefits such as
antiaging, moisturizing, and makeup. A few such products include Age Defense Anti
Oxidant Moisturizer SPF 20, Healthy Skin AntiWrinkle Cream with sunscreen SPF 15,
HealthyDefenseDailyMoisturizerwithsunscreenBroadSpectrumSPF50SensitiveSkin,
andVisibleEvenDailyMoisturizerBroadSpectrumSPF30.
Neutrogena also offers sun care moisturizers designed specifically for men. These
includeNeutrogenaMenTripleProtectFaceLotionwithsunscreenSPF20,Neutrogena
Men Sensitive Skin OilFree Moisture with sunscreen Broad Spectrum SPF 30, and
NeutrogenaMenAgeFighterfaceMoisturizerwithSunscreenSPF15.
Johnson&Johnsonsotherbrandinthecategory,Aveeno,recordssalesat$20millionin
Followingadeclinein2011,Aveenorecuperatesitssalesin2012withthelaunchofits
newProtect+Hydratelineofproducts.
TheProtect+HydrateproductlinecomprisesthreeSKUs:LotionSunscreenwithBroad
SpectrumSPF30,LotionSunscreenwithBroadSpectrumSPF50,andLotionSunscreen
withBroadSpectrumSPF70.
4A190
Johnson&Johnson
PersonalcleansingproductsisthesixthlargestcategoryforJohnson&Johnson,accounting
for5.7%ofthecompanystotalsalesin2012.
Categorysalesremainflatat$115millionin2012,constantwith2011levels.
ThecompanysellsAveeno,JohnsonsKids,JohnsonsSoftwash,andNeutrogenabrands
inthecategory.
AveenoisthebiggestbrandforJohnson&Johnsoninthecategoryin2012.
Aveenossalesdecline2.7%,from$73millionin2011to$71millionin2012.
SalesofNeutrogenagrowby7.5%,from$40millionin2011to$43millionin2012.
JohnsonsSoftwashbrandssalesremainflatat$1millionin2012.
ThemarketerdiscontinuesitsJohnson'sKidsbrandinthecategoryin2012.
Johnson & Johnsons shampoos categorys sales are flat at $113 million in 2012, constant
with2011levels.
Johnson&Johnsonisthefourthrankedmarketerintheshampooscategoryandhasa
4.3%shareinthecategoryssales.
Thecompanymarketsfourbrands,Neutrogena,JohnsonsBaby/KidsShampoo,Nizoral
AD,andAveeno,inthecategory.
Neutrogena,theleadingbrandfromJohnson&Johnson,grows1.9%from$53millionin
SignificantproductlaunchesunderNeutrogenain2012areCleanReplenishingshampoo
andTripleMoistureCreamLathershampoo.
Johnson's Baby/Kids brand experiences a decline of 5.4%, from $37 million in 2011 to
$35millionin2012.
Sluggishsalesinthechildrensandbabieshaircaresegmentnegativelyaffectthesales
oftheJohnson'sBaby/Kidslinein2012.
ThemarketersellsonlyonebrandNeutrogenainthefacemakeupcategory.
Salesgrowby4.2%,to$75millionin2012from$72millionin2011.
Thecompanysconditionerscategorygrowinsalesby3.6%from$55millionin2011to$57
millionin2012.
Themarketerdistributesthreebrandsunderthiscategory:Neutrogena,Johnsons,and
Aveeno.
The marketer launches several new products under both, Aveeno and Neutrogena
brandsthatsupportthemarketerssalesgrowthinthecategory.
Neutrogena,thelargestbrandforJohnson&Johnson,hasacategoryshareof1.9%in
2012.
Neutrogenassalesgrowby$1millionfrom$31millionin2011to$32millionin2012.
The launch of Neutrogena TGel range of conditioners supports the brands growth in
2012.
SalesofAveenogrowby6.7%,from$15millionin2011to$16millionin2012.
5191
5192
Johnson&Johnson
Inthetoothwhiteningproductscategory,Johnson&Johnsondropstofifthplacein2012,
experiencingadeclineinmarketsharefrom3.1%in2011to3.0%in2012.
TheListerinetoothwhiteningbrandwasdiscontinuedfromthemarketin2011,leading
tothesalesdeclineforJohnson&Johnsoninthecategory.
ThediscontinuationofListerineWhiteningproductscan,tosomeextent,beaccounted
forbythelawsuitforpatentinfringementfiledagainstthecompanyin2008byProcter
&Gamble.
ThelawsuitprohibitedJohnson&JohnsonandMcNeilPPCfrommaking,selling,and/or
importing any products that infringes on Procter & Gambles patents for tooth
whiteningproducts.In2011,thecompanystoppeddistributingitswhiteningstrips.
ThecompanysotherbrandRembrandtssalesgrowby14.3%,from$7millionin2011
to $8 million in 2012. The brands growth is supported by an increase in promotional
activityin2012.
Thecompanyoccupiesfifthplaceinthetoothpastescategory.
ThecompanysellsRembrandtandListerinebrandsunderthiscategory.
Theoverallmarketshareremainsflatat1.4%in2012.
Totalcategoryssalesgrow3.6%,from$28millionin2011to$29millionin2012.
Johnson&JohnsonsNeutrogenabrandcontinuestobethelargestmensskincarebrandin
2012,withmanufacturerssalesat$23millionin2012,up4.5%from$22millionin2011.
TheNeutrogenabrandisknownforitsacneandantiagingskinbenefits.
The brands growth is mainly attributed to the sales from its facial treatments,
specificallyitsfacewashesandfacialtreatmentscontainingSPFbenefits.
Neutrogena Men competes in the category through four product lines including
NeutrogenaMen,RazorDefense,SensitiveSkin,andSkinClearing.
Thebrandsfurthergrowthin2012hasbeenoffsetbythelackofnewandinnovative
productactivity.
Sales in Johnson & Johnsons lip balms, jellies, and treatments category remain flat at
$18millionin2012.
Neosporin,Aveeno,andNeutrogenaarethebrandsmarketedunderthecategory.
Allbrandsinthecategory,Neosporin,Neutrogena,andAveenohavesalesof$6million
respectivelyin2012.
Thecompanysshavingproductssalesdecline5.9%from$17millionin2011,to$16million
in2012.
Johnson & Johnson retains its position as the fourthlargest player in the shaving
The marketer is represented in the category with its Aveeno and Neutrogena Men
brands.
SalesofAveeno,Johnson&Johnsonsleadingbrandintheshavingproductscategory,
decline9.1%to$10millionin2012,downfrom$11millionin2011.
Neutrogena Men is the other brand of the marketer with which it competes in the
category.In2012,thebrandssalesremainconstantat$6millionfrom2011levels.
4A192
Johnson&Johnson
Johnson&Johnsonsmakeupproductclasssalesdeclineby14.3%,from$28millionin2011
to$24millionin2012.
ThecategorymarketsonlyonebrandNeutrogena.
Thelipsticksandlipglossescategoryssalesdeclineby30.8%,from$13millionin2011
to$9millionin2012.
Theeyemakeupcategoryssalesremainflatat$15millionin2012.
RECENTDEVELOPMENTS
Mergers,alliances,divestures,andacquisitions
Therehavenotbeenanymajordevelopmentsintermsofacquisitionsduring2012.
InJune2012,Johnson&JohnsonannouncescompletingtheacquisitionofSynthes,fora
totalpurchasepriceof$19.7billionincashandstock.
In March 2013, Johnson & Johnsons Cordis Corporation announces acquisition of
FlexibleStentingSolutionsInc.Itsfinancialtermsare,however,notdisclosed.
Managementchanges
In February 2012, Johnson & Johnson announces Alex Gorsky as Chief Executive Officer,
effectiveApril26,2012.
In September, 2012, Johnson & Johnson recruits Sandra Peterson as Group Worldwide
Chairman. She oversees information technology and the global supply chain, as well as
Johnson&Johnsonsconsumerbusiness.
Otherdevelopments
InAugust2012,JanssenBiotechannouncesgloballicenseanddevelopmentagreementfor
investigationalanticanceragentdaratumumabwithDanishcompanyGenmab.
In 2012, Johnson & Johnson recalls its Johnsons Baby Shampoo and discontinues its
Johnson&JohnsonsOrganicHarvestlineofshampoolosesitsUSDANOPcertification
on account of the fact that its products contain ingredients that are not on the
nationallyapprovedlistoforganicingredients.
5193
5194
Johnson&Johnson
Newproducts
Table5112:SelectNewProductsIntroducedbyJohnson&JohnsonintheUnitedStatesin2012
Brand
Category
Description
Aveeno
Facial
treatments
PositivelyAgelessCorrectingTintedMoisturizerisformulatedwithnatural
shiitakecomplexandvitaminC,tohydrateandnourishfacialskintohelp
visiblyreducethelookoffinelinesandskindiscolorations
Aveeno
Suncare
products
Protect+HydrateLotionSunscreenwithBroadSpectrumisacombination
ofEnviroguardTechnologyandActiveNaturalsOattoprovideUVAandUVB
sunprotection.Itisoilfree,noncomedogenic,sweatandwaterresistant
forupto80minutes,andisavailableinSPF30,SPF50,andSPF70.
Aveeno
Shampoos
PureRenewalshampoorefresheshairwithoutwaterforacleanand
healthylookbetweenwashes
Aveeno
Conditioners
PureRenewalconditionerrefresheshairwithoutwaterforacleanand
healthylookbetweenwashes
CleanandClear
Facial
treatments
AdvantageOilAbsorbingTreatmentisdesignedforuseinplaceofaregular
moisturizer.Thisoilfreeacneformulacontainssalicylicacidtotreat
breakoutswithoutcloggingpores
Listerine
Mouthwashes
TotalCareZeroinFreshMintvariant,preventscavities,restoresenamel,
strengthensteeth,preventsbadbreath,andcleansthewholemouth
Listerine
Mouthwashes
Ultracleanmouthwashcontainsantitartaringredientforcleaner,brighter
teeth,clinicallyproventoremoveplaqueandkillgerms.Itisavailablein
twovariants:ArcticFreshandFreshCitrus
Neutrogena
Facial
treatments
AllInOneAcneControlTreatmentnoticeablyfadesthelookofpastacne
marks,clearspresentbreakouts,andhelpspreventfutureacne
Neutrogena
Facial
treatments
TheNaturalslineisextendedwithMultiVitaminNourishingMoisturizer,a
dailylotionthatreplenishesessentialnutrients.Thecompanyclaimsitis
97%naturallyderivedandcontainsantioxidants
Neutrogena
Facial
treatments
UltraGentleDailyCleanserisanewcleanserformulatedforsensitiveskin
Neutrogena
Shampoos
CleanReplenishingshampoogentlycleanseshairanditsmoistureenriched
formulaprovidesalldaymoisturization
Neutrogena
Shampoos
TripleMoistureCreamLathershampoocontainsthreenaturallyderived
extractsthatpenetratetofightdrynessonallthreedimensionsofthehair
strand,asidefromcombatingfrizz
Neutrogena
Shampoos
TripleRenewalVolumeBoostingshampooisinfusedwithaminoacids,
vitamins,andnaturallyderivedproteins
Neutrogena
Shampoos
AntiResidueshampooisatreatmentthatinstantlycleanseshair,rendering
thestrandscleanandresiduefree
Neutrogena
Shampoos
Cleanvolumeshampoogentlycleansesandaddsbodytoflatandlifeless
hair
(Continued)
4A194
Johnson&Johnson
Table5112:SelectNewProductsIntroducedbyJohnson&JohnsonintheUnitedStatesin2012
Brand
Category
Description
Neutrogena
Conditioners
CleanReplenishingconditionergentlycleansesanditsmoistureenriched
formulapenetratesdrydamagedstrandstomakehairmoreresilient
Neutrogena
Conditioners
TripleMoistureDailyDeepconditionercontainsnaturallyderivedextracts
thatpenetrateandmoisturizehairstrands,therebyprovidingsmoothness
andsoftness
Neutrogena
Conditioners
TripleRenewalWeightlessconditionerisinfusedwithablendofamino
acids,vitamins,andnaturallyderivedproteins
Neutrogena
Conditioners
CleanVolumeconditionergentlycleansesandaddsbodytoflatlifelesshair,
leavingnobuildup
NeutrogenaMen
Skincare
productsfor
men
SkinClearingAcneWashisanoilfreegentleformulawhichcleansesdeep
porestominimizebreakoutsandingrownhairandpreventnewonesfrom
appearing
Rembrandt
Toothpastes
RembrandtGentleWhitetoothpasteisspecificallydesignedforpeople
pronetocankersores.Theproducthelpswhitenteethandstrengthens
toothenamelwithoutsodiumlaurylsulfate(SLS),whichhasbeenreported
tocauseirritation
RoC
Facial
treatments
RetinolCorrexionMaxWrinkleResurfacingSystemisatwostepsystem
thatrenewsthelookandfeelofskinandclaimstobeclinicallyproventobe
uptofourtimesmoreeffectivethanaseriesofdermatologicalpeels
MARKETINGACTIVITY
Johnson&Johnsonusesmultiplewaystopromoteitsproductsincludingbroadcastmedia,
discountcoupons,instorepromotins,andonlinepromotions.
Themarketerpreferstelevisionandmagazineadvertisementstopromoteitsproducts.
The marketer offers discount coupons through magazines, newspapers, and websites as
oneofitskeyconsumerpromotionaltools.
Johnson & Johnson primarily offers discount coupons for its new product launches in
ordertosupportitssales.
Themarketerofferscouponswith$1.00offonitsJohnsonsHeadToToeBodyWash.
The company offers discounts coupons ranging from $1.00 to $2.00 on Listerines
websitetopromotethesalesofitsproducts.
Johnson & Johnson offers coupons worth $1.00 off on Johnson & Johnsons baby oil
products.
Johnson&Johnsonsponsors$1.00and$2.00denominationdiscountcouponsonmost
ofitsbabycareproductsthroughouttheyear.
5195
5196
Johnson&Johnson
Johnson&Johnsonspendsabout$439.8milliononTMEtosupportitsbrandsin2012.
Themarketerdecreasesitsmediaexpendituresby9.7%from$486.9millionin2011.
The largest part of the media spend is for television spots and magazines, which
togetheraccountfor96.8%ofthetotaltraceablemediaexpenditures(TMEs).
The company spends about 64.6% on television advertisements and 32.2% through
magazinesin2012.
Johnson & Johnson continues to be the secondlargest advertiser in the hand and body
lotionscategorywithaTMEof$49.9millionin2012,down1.2%from$50.5millionin2011.
MostoftheTMEor$41.4millionisapportionedtowardstelevisionmediain2012.The
companyallocatesaTMEof$8.1milliontowardsmagazineadvertisements.
The company promotes its brands competing in the category through television
commercials and fullpage advertisements in popular beauty publications, such as
Glamour,Lucky,andBeautyFashion.
In2012,Johnson&Johnsonallocates$41.0millioninTMEtopromoteAveenosDaily
MoisturizingBodyLotion.
Johnson&Johnsonistheleadingadvertiserinthebabycareproductscategory,withTMEat
Ofthis,58.6%ofTMEor$18.4millionisallocatedtomagazineadvertising,andtherest
isallocatedacrosstheInternetandtelevisionmedia.
Johnsons, the leading brand in the category, receives the majority of TME, at
$27millionin2012,withJohnsonsBabylotionsreceivinganindividualTMEallocation
of$8.9million.
Johnson & Johnson is the leading advertiser in the mouthwashes category with TMEs of
$55.9millionin2012,downby21.6%from$71.3millionin2011.
About threefourth of the companys advertising spend is allocated to television
commercials,andmostoftheremainingquarterspentonmagazineadvertisements.
All of the companys advertising support is allocated to the Listerine brand, with no
spendingonminorbrandsListermint,Plax,andRembrandt.
4A196
Johnson&Johnson
The marketer adopts various methods of promotions including instore promotions,

sampling,andonlinepromotions.
In 2012, Johnson & Johnson launches its website, safteyandcarecommitment.com,
which informs consumers about the safe use and quality of ingredients and about
chemicalsusedinitsproductformulations.Thewebsiteistobeupdatedwithconsumer
feedback, new regulations, scientific developments, and information on Johnson &
Johnsonspolicies.
The Johnsons brand website established a platform encouraging moms to share their
funnystoriesandadvice.
The brand also utilizes its website to provide useful and necessary information from
healthcareprofessionalsandexpertstonewmoms.
The marketer displays its entire product range and keeps consumers abreast of new
productsandpromotionalactivitiesonitsFacebookpage.
JohnsonsFacebookpageoffersadviceandtipstohandlevariousbabyproblems.
The marketer promotes its products on this page by advertising numerous discounts
thatcanbeavailedbytheconsumers.
Thecompanyswebsiteisalsoutilizedtopromotecouponsandspecialoffers.
The marketer also utilizes social media sites such as Facebook, Pinterest, Twitter, and
Youtubepredominantlytopromoteitsproducts.
Johnson & Johnson continues to promote its products through its leading online
educationsite,babyCenter.com.
Johnson& Johnson distributes coupons and samples of its products to expectant
mothersthroughthesite.
TheListerinebrandswebsiteprovidestipsformaintainingacleanandhealthymouth.
Product advertisements increasingly differentiate products based on the ability to deliver

addedbenefits.
Johnson & Johnsons brand Listerine teeth whitening products advertisements tout its
ability to whiten teeth and provide deep cleaning. Products feature the #1 Dentist
RecommendedBrandlogoonitspackagingandadvertisements.
Plaxadvertisementsnotethebrandsclinicallyvalidatedefficacy.
InMarch,2013,OralHealthAmerica(OHA)joinshandswithListerinebrandtopromoteoral
healthcareforchildren.
OHAandListerineplantocallallAmericanstotakea21DayChallenge,swooshingwith
ListerineAntiseptictwiceadayfor21days,inordertoimprovetheiroralhealth
For every person who registers for the challenge, Listerine will contribute to OHAs
SmilesAcrossAmericaprogram.
5197
5198
Johnson&Johnson
Brand Ambassadors Emma Roberts, Hayden Panettiere, Miranda Cosgrove, and Sandra
EcheverriateamupwithNeutrogena,tostartthethirdannualWaveForChangecampaign
toencourageteenstohelpbuildbrighterfuturesforchildrenacrossthecountry.
NeutrogenaandGlobalGiving,afundraisingcharity,teamuptoreachagoalof$250,000
throughonlineinitiativestodriveteenstowardsthisnoblecause.
For every video view of the campaign on Neutrogenas Wave for Change website or
NeutrogenasFacebookpage,$1.00willbedonatedtoGlobalGivingtosupporttheU.S.
educationalorganizations.
EmmaRobertshasalsodesignedaWaveforChangetotebagtobegiftedtothosewho
makeapurchaseoftwoNeutrogenafacialskincareproductsatTarget.
InJanuary2013,JenniferAnistonsignsadealtobethenewfaceofAveenoproducts.The
newadvertisementreleasesinFebruary2013.
Aveenospreadsproductawarenessthroughmobileadvertisements.
Theseprintadvertisements,poweredbyShopText,promotethecompanysNourishand
Strengthenlineofshampoosandconditioners.
Thisapproachismeanttohelpclientsgetthemostoutofeveryadvertisementtheyrun.
The company also arranges special events and works together with retailers on special
promotions.
Targetoffersafree$5.00giftcardthatcanbeusedtobuyAveenoproducts.
CVSofferscouponsworth$1.00offonanyoneAveenoBodyCareProduct.
OUTLOOK
Johnson&Johnsonisforecasttopostmoderategrowthof1.5%overtheforecastperiod,
2012to2017.
The company will continue to gain sales through new product launches and product
innovationsduringtheforecastperiod.
Facial treatments and sun care product categories are expected to show good growth
forthemarketerovertheforecastperiodsupportedbyproductinnovations.
Thecompanysnaturalproductlineswilldrivethesalesofthecompanyinthefuture.
However, the recentlysurfaced legislative and imagerelated issues will take time to
resolveandwilllikelyimpedethecompanysomewhatthroughouttheearlypartofthe
forecastperiod,2013and2014.
However, the company is strong, with competencies and brand equity in many areas,
andwillrecuperatewithsomestrategicdeviationsfromitsrecentpaths.
4A198
Johnson&Johnson
TheFacialtreatmentscategoryisexpectedtobethelargestrevenuegeneratorforJohnson
&Johnsonovertheforecastperiod.
Johnson & Johnson will likely launch new products with innovative technologies and
multibenefitpropertiestosupportthecategorysgrowth.
Themarketerislikelytointroduceproductsthatwilltargetpreventionandcorrectionof
commonissuesrelativetofacialconcerns.
Growingdemandforantiagingproductsisexpectedtosupportthecategorysgrowthin
thefuture.
Themarketerwillfocusoneliminatingharshchemicalingredientsinitsfacialtreatment
productsinordertosupportitssalesandcapitalizeonthegrowingnaturaltrend.
Thesuncareproductscategoryisforecasttopostthehighestgrowthof3.8%forJohnson&
Johnsonoverthenextfiveyears.
The marketer plans to launch products with multibenefits including antiaging, skin
nourishing, brightening, and makeup to support its sales in the category over the
forecastperiod.
Johnson & Johnson is expected to introduce sun care products with appropriate
cosmeticpropertiesandtextures.Theseproductswillapparentlydemandhigherprices,
permittingthecompanysdollarsalestogrow.
The company will continue to launch men care products in the category as the mens
segmentisprojectedtoperformwell.
Asanimportantcompanyinthepharmaceuticalindustry,Johnson&Johnsonshouldbe
asmuchormorepreparedcomparedtoitscompetitors,tosmoothlyadapttothenew
FDAsunscreenregulations.Thecompanyshouldnotbenegativelyaffectedbythemajor
changesrequiredasitisaccustomedtoworkingunderFDAguidelines.Newregulations
on product labeling and formulations have been forced into effect inDecember 2012,
andarelikelytoleadtoeffectivechangesduringthecomingyears.
The second largest category for Johnson & Johnson, mouthwashes, is forecast to post
moderategrowthof1.0%.
The marketer will continue to increase awareness among consumers regarding oral
hygieneinordertosupportitsoralcaresales.
Johnson&Johnsonisexpectedtointroducemouthwasheswithmultibenefitssuchas
teeth whitening, protection against bad breath, and enamel protection to support its
salesinthecategory.
The marketer is expected to increase its TME spending on the Listerine brand
mouthwashesoverthenextfiveyearstopromoteitssales.
The company is expected to provide more appropriate claims to its products in the
futuretoavoidanylegalissues.
5199
5200
Johnson&Johnson
Themarketerwillcontinuetobethesinglemostdominantplayerinthebbaycareproducts
categoryovertheforecastperiod.
Thecompanywillcontinuetomaintainitsleadingpositiondespitethenegativemedia
coveragesurroundingtherecallofitsJohnsonsBabyShampooandthediscontinuation
ofAveenosOrganicHarvestline.Thecompany,inordertosupportthesalesofitsbaby
care line, plans to remove the formaldehydereleasing preservative from all its baby
productsworldwidetoretainitsmarketshareintheforecastperiod.
Themarketerisexpectedtocontinuallyimproveitsproductassortmentandmakeuse
oftheincreasingdemandfornaturalproducts.
Naturally positioned brands such as Aveeno will continue to proliferate as parents
continuetolookintothewellbeingoftheirbabies.
ThecompanyscorebrandsAveeno,Johnsons,Listerine,andNeutrogenaareexpectedto
driveJohnson&Johnsonssalesoverthenextfiveyears.
Johnson&Johnsonwillcontinuetolaunchseveralnewproductextensionsunderthese
brandstosupportitssalesinthefuture.
The marketer will continue to infuse more natural ingredients into its products to see
highergrowthovertheforecastperiod.
Aveenoislikelytoperformwellacrossallskincarecategories,duetothepopularityof
naturalpositionedproducts.
Neutrogena,backedbyitstechnologyandstrongnewproductactivity,willbethekey
brandforthecompanyinthefacialtreatmentsandsuncarecategories.
Thecompanywillcontinuetoincreaseitsspendingonresearchanddevelopmentactivities
inordertointroduceproductwithbettertechnologies.
Johnson&Johnsonislikelytofocusoninnovations,asitwillbeakeytothecompanys
overallsalesgrowth.
The marketer is expected to launch innovative products based on latest scientific
techniquesandclinicaltrials.
Johnson&Johnsoncontinuestofocusonitssustainabilityprogram,HealthyFutureunder
which it plans to set a series of objectives to strengthen its position in the personal care
marketovertheforecastperiodbyusingsustainablepackaging.
As a part of this program, the company plans to focus on sustainable product
developmentandinnovationsinthecompanysproductportfolio.
Themarketerhassetupawebsite,www.saftetyandcarecommitment.com,inorderto
highlightthebenefitsofitssustainablepackagingbenefits.
4A200
Johnson&Johnson
The company will continue to focus on naturallypositioned products, as this segment is

expectedtoperformwellinthefuture.
Johnson&Johnsonplanstoreduceoreliminatechemicalingredients,suchasparabens,
triclosan,anddiethylphthalatefromitsproductsovertheforecastperiod.
The company will likely launch products with more natural ingredients to support its
overallsales.
The marketer also plans to reformulate its entire range of products that contain
harmfulchemicalsbyendof2015.
Someofthechemicalsthatthecompanyplanstoeliminatefromitsproductportfolio
includes;4dioxaneandquaternium15.
The marketer plans to eliminate these chemicals from its leading brands such as
Neutrogena,Aveeno,andClean&Clear.
The marketer plans to enter new segments in order to strengthen its position in the
personalcaremarketovertheforecastperiod.
Johnson&Johnsonplanstocompeteintheantiwrinklearenawiththeformulationof
newdrugsin2013.
WhenthedruggetsapprovalbytheFDA,thecompanyexpectstodisplaycompetency
invariablyinthisarenatosupportitsoverallgrowth.
Johnson&Johnsonisexpectedtoincreaseitsmarketingandpromotionalactivitiesoverthe
forecastperiod.
The marketer will likely increase its TME support for its brands across categories to
supportitssales.
The marketer will continue to support its new product introductions with aggressive
mediaexpenditurestosupportitssales.
Themarketerwillcontinuetoengageconsumersinvariouscontestsandcampaignsin
ordertoeducateconsumersregardingitsproducts.
The company will continue to offer discount coupons and free samples for its new
launchesinordertoattractconsumers.
Televisionandprintadvertisingwillcontinuetobethepreferredchannelsofadvertising
forJohnson&Johnsonoverthenextfiveyears.
The marketer will continue to increase its presence on social media sites such as
Facebook, Twitter, Pinterest, and Youtube to keep the consumers engaged with its
products.
SalesofJohnson&Johnsonscosmeticsandtoiletriesareprojectedtoreach$2,180million
by2017,upbyaCAGRof1.5%from$2,020millionin2012.
5201
5202
Johnson&Johnson
ToiletriesforJohnson&JohnsonbyCategory,2012to2017
Category
CAGR,%
Suncareproducts
3.8
Facialtreatments
3.0
Facemakeup
2.5
Eyemakeup
2.4
Shampoos
2.3
Conditioners
2.3
2.2
Handandbodylotions
2.2
2.0
1.5
COMPANYAVERAGE
1.5
1.2
Mouthwashes
1.0
0.8
Babycareproducts
0.6
0.5
Toothpastes
Shavingproducts
(4.5)
4A202
KAO
Table5114:KaosSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
HANDANDBODYLOTIONS
Jergensr
2012
149
162
Curelr
47
46
Totalr
196
208
FrizzEase
56
58
JohnFriedar
12
12
SheerBlonde
Allother
75
77
54
58
61
65
52
51
15
15
Allother
23
23
Totalr
41
41
SheerBlonde
17
17
BrilliantBrunette
14
14
RootAwakening
RadiantRed
44
39
Total
FACIALTREATMENTS
Bior
Jergens
Total
Ban
CONDITIONERS
BrilliantBrunette
RadiantRed
SHAMPOOS
Totalr
(Continued)
5204
Kao
Table5114:KaosSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
PrecisionFoamColor
Jergens
TOTALr
rRestated.
2012
26
38
504
525
COMPANYOVERVIEW
Kao Corporation, headquartered in Tokyo, Japan, manufactures and markets household

cleaningproducts,industrialproducts,personalcareproducts,foodproducts,andchemical
products.
Thecompanysbusinessisbroadlydividedintotwobusinessdivisions:ConsumerProducts
andChemicals.
TheConsumerProductsDivisionisdividedintothreesubbusinessunitsthatincludeBeauty
Care,HumanHealthCare,andFabricandHomeCare.
TheConsumerProductsDivisionaccountsforthebulkofthecompanystotalsalesand
includesalargevarietyofproducts.
The Beauty Care business comprises prestige cosmetics, premium skin care products,
andpremiumhaircareproducts.
The Human Health Care business includes food and beverage products, sanitary
products,andpersonalhealthproducts.
The Fabric and Home Care business consists of fabric care products and home care
products.
The Chemical Business comprises Oleo chemicals, performance chemicals, and specialty
chemicals.
The companys operations are spread over more than 25 countries, including locations in
Asia,Australia,NorthAmerica,andEurope.
In2012,Kaoemploysabout34,069workersacrossallKaoGroupcompaniesglobally.
4A204
Kao
IntheUnitedStates,KaoisheadquarteredinCincinnati,OH.
EffectiveJanuary2012,thecompanyundergoessequentialreorganizationasaresultof
which Kao Brands Company, KPSS, Inc, and KMS Global Marketing LLC have been
combinedandarenowcollectivelyknownasKaoUSA.
KaoUSAmanufacturespersonalcareproductsformenandwomenunderlabelnames
suchasJergens,Curel,SoftSense,Bior,JohnFrieda,andBan.
Kaos worldwide sales increase 2.5% from JPY 1,186.8billion (USD 14.9 billion) in 2011 to
JPY1,216.1billion(USD15.2billion)in2012.
Table5115:KaosGlobalCorporateSales,2007to2012
Billion
Yeara
Sales
Netprofits
Marginonsales
2007
1,231.8
70.5
5.7
13.1
2008
1,318.5
66.6
5.0
11.7
2009
1,276.3
64.5
5.1
11.5
2010
1,184.3
40.5
3.4
7.3
2011
1,186.8
46.7
3.9
8.5
2012
1,216.1
52.4
4.3
9.8
aFiscalyearendingMarch31oftheyearafter.
NOTE:$1.00=79.78.
Table5116:KaosGlobalCorporateSalesbyProduct
Class,2011and2012
%Oftotal
Productclass
2011
2012
ConsumerProducts
83.3
82.7
ChemicalProducts
19.5
20.4
Eliminationsa
(2.8)
(3.0)
Total
100.0
100.0
aEliminationisintersegmentsalesandinterregional
sales.NetsalesoftheChemicalBusinessinclude
intersegmentsalestotheBeautyCareBusiness,the
HumanHealthCareBusiness,andtheFabricandHome
CareBusiness.
Returnonequity
5205
5206
Kao
KaosdomesticsalesinJapanconstitutethemajorportionofthecompanystotalsalesin
2012.
Salesinthedomesticmarketseizesalessharefromtherestoftheworld.
SalesinNorthAmericaandEuropeaccountfor16.6%oftotalrevenuesin2012,aslight
increasefrom2011levels.
Asia and Oceania account for the remaining 14.3% of Kaos total revenues in 2012, a
sharprisefrom12.8%in2011.
Table5117:KaosGlobalCorporateSalesbyRegion,2011and
2012
%Oftotal
Region
2011
2012
Japan
76.9
76.1
NorthAmericaandEurope
16.2
16.6
AsiaandOceania
12.8
14.3
Eliminations
(5.9)
(7.0)
100.0
100.0
Total
KaossalesintheU.S.cosmeticsandtoiletriesmarketincrease4.2%toreach$525millionin
2012,upfrom$504millionin2011.Themarketersgrowthisattributedtotheincreasein
salesofthecompanyslargestcategory,handandbodylotions,andthefacialtreatments
category.
Also, Kaos entry into the hair coloring category with the John Frieda Precision Foam
Color in late 2010 continues to boost the marketers sales with the addition of new
shadesin2012.
Since2007,Kaoshavegrownatacompoundannualgrowthrate(CAGR)of2.4%.
Table5118:KaosCosmeticsandToiletriesSalesinthe
Year
$Million
Change,%
2007r
466
2008
446
(4.3)
2009r
463
3.8
2010r
468
1.1
2011r
504
7.7
2012
525
4.2
r Restated.
4A206
Kao
HandandbodylotionscontinuestobethelargestcategoryforKaoin2012.
Themarketeristhethirdleadingmarketerinthehandandbodylotionscategory,with
salesat$208millionin2012.Salesgrow6.1%from$196million2011.
Kaosmarketshareinthehandandbodylotionscategoryadvancesfrom8.8%ofthe
totalcategoryssalesin2011,to9.1%ofthetotalcategoryssalesin2012.
KaoisrepresentedinthecategorywithitsJergensandCurelbrands.
Jergensisthelargestmassbrandinthehandandbodylotionscategory,accountingfor
7.1%ofthetotalcategoryssalesin2012,upfrom6.7%in2011.
Salesforthebrandadvance8.7%from$149millionin2011to$162millionin2012.
The good performance of the newlyintroduced Jergens Crema line with three
variantsCremaDeepConditioningOatmealBodyLotion,CremaSoothingAloeVera
BodyLotion,andCremaHydratingCoconutMilkaidsinthebrandsgrowth.
JergenslineofproductsinthehandandbodylotionscategorycomprisesNaturalGlow,
DailyMoisturizers,andCrema.
Alsoin2012,themarketerchangesthepackagingofitsNaturalGlowlineofproducts
withnewproductintroductions,includingtheNaturalGlowandProtectandtheDaily
Moisture Dry Skin Lotion, each including two variants for different skin tones: fair to
mediumandmediumtotan.
SalesofCureldeclinein2012to$46million,down2.1%from$47millionin2011.
Inadditiontobodylotions,Curelalsooffershandandfootcareproductsintheformof
Hand&CuticleTherapyandFootTherapy,respectively.
Kaos sales in the hair care product class increase 4.8% to reach $195million in 2012, up
Hair styling products and sprays is the secondlargest category for Kao in 2012, with
Hairstylingproductsandspraysaccountsfor14.7%ofthecompanystotalsalesinthe
cosmeticsandtoiletriesmarketin2012,adeclinefrom14.9%in2011.
KaosgrowthinthecategoryisduetothegoodperformanceoftheFrizzEasebrand
whichpostsagrowthof3.6%.
KaosotherbrandsinthecategoryincludeJohnFriedaandSheerBlonde,salesofwhich
remainconstantin2012,flatfrom2011levels.
Conditioners is the fifthlargest category for Kao followed by the shampoos and hair
coloringproductcategories.
Themarketerssalesintheconditionerscategoryremainstableat$41millionin2012,
flatfrom2011levels.
In2012,themarketerintroducestheExtraRichConditioner.
Sales of Kao in the shampoos category decline 11.4% from $44million in 2011 to
$39millionin2012.
The marketers shampoo sales represent 7.4% of its total sales in the U.S. cosmetics
andtoiletriesmarketin2012,adeclinefrom8.7%in2011.
KaointroducestheFadeStopShampooin2012.
Kaossalesinthehaircoloringproductscategorypostanenormousgrowthof46.2%to
reach$38millionin2012,upfrom$26millionin2011.
In2012,themarketercontinuestoaddmoreshadestoitsPrecisionFoamBasedHair
Colorwithwhichitenteredthehaircoloringproductsmarketin2011.Foambasedhair
coloring product formulations remain a significant trend with the advantages of drip
freeformat,100%graycoverage,longlasting,andconvenientapplication.
5207
5208
Kao
FacialtreatmentsisthethirdlargestcategoryforKao,withsalesat$65millionin2012,up
In 2012, the share of facial treatments as a proportion of the companys total sales
increasesfrom12.1%in2011to12.4%in2012.
ThemarketerispresentinthecategorywithitsBiorandJergensbrands.
Bior marks a significant presence in the category with sales up 7.4% to reach
In2012,thecompanyintroducestheBiorCombinationSkinBalancingCleanser.
Sales of Jergens in the category remain stable at $7million in 2012, flat from 2011
levels.
Deodorants and antiperspirants is the fourthlargest product category for Kao in the
cosmetics and toiletries market, with sales declining 1.9% from $52million in 2011 to
$51millionin2012.
In2012,deodorantsandantiperspirantsrepresent9.7%ofthemarketerssales,down
0.6%from10.3%ofthemarketerssalesin2011.
Themarketerssalesinthecategorycontinuetodeclineduetothelimitedpenetration
withitsBanbrand.Ithasnonewactivityin2012withtheexceptionoftheintroduction
of the Simply Clean Invisible Solid, which is unable to help the marketer regain its
Furthermore,thedearthofadvertisingexpendituresinsupportofitsBanbrandaddsto
thebrandsdecliningsalesin2012.
RECENTDEVELOPMENTS
Nomergersandacquisitionstakeplacein2012.
Managementchanges
In June 2012, Michitaka Sawada is appointed to the position of Representative Director,

President,andChiefExecutiveOfficer.
Andrea DeLeon is promoted from Senior Director, Marketing to Vice President,
MarketingforKaosSalondivisionintheUnitedStates.
4A208
Kao
Newproducts
Table5119:SelectNewProductsIntroducedbyKaoin2012
Brand
Category
Description
Ban
Deodorantsand
antiperspirants
SimplyCleanInvisibleSolidcontainsfloralandambernotesforalong
lastingscent
Bior
Facialtreatments CombinationSkinBalancingCleanserisanewcleanserforcombinationskin
Goldwell
Shampoos
FadeStopshampoo,withitsuniqueFadeStopformulawithpomegranate
essencepreventsminimalcolorfading
Goldwell
Conditioners
ExtraRichconditioner,withitsuniqueformulawithpomegranateessence
providesminimalcolorfading
Jergens
Handandbody
lotions
NaturalGlowandProtectisabodymoisturizer,providesUVA/UVB
protection(SPF20),availablefortwoskintones:fairtomediumand
mediumtotan
Jergens
Handandbody
lotions
DailyMoistureDrySkinLotionisanodorlessdailymoisturizer,which
revitalizesskinwithantioxidantandvitaminE.Itisavailablefortwoskin
tones:fairtomediumandmediumtotan
Jergens
Handandbody
lotions
CremaDeepConditioningOatmealBodyMoisturizer,containsoatmeal
formulathatprovideshealingandsoothingpropertiestoreplenishtheskin
Jergens
Handandbody
lotions
CremaSoothingAloeVeraBodyMoisturizerisabodymoisturizerenriched
withaloevera,vitaminE,andvitaminB5
Jergens
Handandbody
lotions
CremaHydratingCoconutMilkBodyMoisturizerisalightweightformula
withcoconutmilk
JohnFrieda
Haircoloring
products
ThemarketeraddsmoreshadestoitsPrecisionFoamColor,permanenthair
color,availablein30shades
MARKETINGACTIVITY
The companys total traceable media expenditures (TME) for cosmetics and toiletries
increase3.1%from$127.4millionin2011to$131.4millionin2012.
Handandbodylotionsisthemarketerslargestadvertisedcategoryin2012,gathering
TMEsupportof$61.2millionin2012,up18.1%from$51.8millionin2011.
Facialtreatmentsreceivesthesecondlargestallocationofmediaexpenditures,witha
TMEof$17millionin2012,up14.1%from$14.9millionin2011.
In 2012, the hair coloring products category for the marketer receives a TME of
$15.8million.
Hair styling products receive a TME allocation of $11.1million in 2012, down 56.8%
JohnFriedaisthemostadvertisedbrandforthemarketer,receivingaTMEsupportof
Jergens follows as the secondmost advertised brand with an advertising support of
5209
5210
Kao
Kao is the largest advertiser in the hand and body lotions category, with a total TME of
Kao allocates $35.3million and $26.0million to its Jergens and Curel brands,
respectively.
Jergens Ultra Healing is the most advertised product line from Jergens, with a TME
allocationof$12.3millionin2012.Mostoftheseexpendituresarespentontelevision
andmagazineadvertisements.
Printadvertisementsinmagazinesremainthepreferredpromotionalmedium,followedby
CommonlyusedmagazinesbyKaoincludeAllure,Vogue,Glamour,InStyle,andCosmo
Girl.
In 2012, Jergens equips its print advertisements with QR codes. The print
advertisements equipped with the QR codes have begun to feature in the November
issueofInStylemagazine.Theadvertisementencouragesconsumerstoscanthemobile
bar codes with their phones to direct them to a web landing page that shows a 30
secondvideoonwomentryingouttheJergensUltraHealingLotion.
Additionally, there is a calltoaction on the page that induces consumers to visit the
JergensFacebookpagewheretheycansubmittheirownstyleideasforachancetobe
featuredintheprintadvertisement.
The marketer uses the QR code strategy to bridge the gap between print and video
advertisements.
Additionally, the marketer uses media advertising, couponing, sampling, and free
standinginserts(FSIs)featuringcouponstopromoteitsproducts.
CouponingremainsanimportantpromotiontoolforKaointhehandandbodylotions
category.
OUTLOOK
Duringtheforecastperiodfrom2012to2017,Kaoisforecasttopostamoderatetohealthy
growthof2.6%.
Themarketerislikelytoexperienceincreasedsalesinskincareandhaircareproducts,
duetothecompanysnewproductintroductions,reformulations,changesinpackaging
and design, and the use of innovative technology. Kao is expected to build on its
marketing strategy to further expand its business in the United States. The company
will continue to increase its media support to further boost sales growth, more so in
thecategoriesinwhichthecompanyhasasizeablepresenceandmarketshare.
One of the companys key aims through the forecast period is to accelerate growth
throughintegratedglobalbusinessoperations.
The marketer will continue to emphasize on the importance and development of
technologyinordertoaddvaluetoitsproductsandincreaseconsumersatisfaction.
4A210
Kao
Kaos new matrix management system will shift the focus of the companys innovation
strategy from innovating in product categories to innovating based on consumers
perspective.
ContinuousinnovationwillbeKaosprimarystrategyduringtheforecastperiodwhich
willhavetwophases.
According to its breakthrough innovation phase, ideas for new products will be
developedthatisexpectedtodrivegrowth.
Thestepbystepinnovationphasewillbringaboutsmallandsignificantchangesthat
will help keep the brands relevant in the market place and fresh in the minds of the
consumers.
Kaossalesinthefacialtreatmentsandhandandbodylotionscategoriesareprojectedto
growat3.2%eachduringthenextfiveyears.
Kaosfacialcarebusinessisexpectedtoremainstrongandvibrantduringtheforecast
period.Productsinthissegmentbenefitfromcompetitivepricingandstrongproduct
formulationsofferedundertheBiorandJergensbrands.
For its Bior brand, the marketer is conducting strong rollouts at the local level by
understandingthetargetdemographyineachnation.
The Bior Restage Project, launched in 2010, has been designed for the brands
strategy in the United States. To gain sales in the U.S. facial cleanser market, the
marketerisrethinkingitstargetdemographybyfocusingonwomenintheirtwenties
due to their loyalty towards the brand. Additionally, based on several surveys, the
companyiscarryingoutcommunicationsstrategythatfocusesondigitalmarketing.
Jergens will continue to be the market leader in the hand and body lotions category
provided the marketer continues to innovate with the introduction of new products,
packaging changes, and technological advancements to offer a variety of product
variantsandkeepthemafreshinthemindsoftheconsumers.
Curelshandandbodylotionswillcontinuetogainsalesduetothepositioningofthe
brand as dermatologist recommended and the product offerings of which are
specificallycreatedtomoisturizeandhealdryskin.
ThenewlineextensionstoJergens,thecompanyslargestbrandinthehandandbody
lotionscategory,willfurtherrevivesalesandgainmarketshare.
Thehaircareproductclasswillcontinuetobeanareaofgrowthforthemarketer,witha
projectedmoderategrowthof1.5%duringtheforecastperiod.
TheJohnFriedaPrecisionFoamColor,whichmarkedthemarketersentryinthehair
coloringproductscategoryin2011,islikelytoperformwellduringtheforecastperiod,
with the possibility of the marketer introducing more product lines that induce
excitementandinterestamongconsumersandwidentherangeofproductstochoose
from.
The marketer is expected to introduce more variants in the hair coloring category to
match up with its competitors and offer its consumers a wide range of products to
choosefrom.
Themarketerisalsoexpectedtoshowamoderategrowthinhairstylingproducts,with
moderatedeclineinsalesintheshampoosandconditionerscategories.
5211
5212
Kao
Inthedeodorantsandantiperspirantscategory,KaosBanisaleadingbrandintherollon
segment and is expected to post stagnant sales until and unless it is refreshed with
formulationchangesandproductintroductions,tokeepabreastofcompetitionandmarket
dynamics.
The marketers performance will continue to decline in the personal cleansing products
categoryasJergensphasesoutofthecategorywithitsbodywashes.
Jergenswillhavelimitedofferingsinthebarsoapssegmentonly.
Kaos dollar sales in the U.S. cosmetics and toiletries industry are projected to grow at a
CAGRof2.2%toreach$586millionby2017,upfrom$525millionin2012.
andToiletriesforKaobyCategory,2012to2017
Category
CAGR,%
5.6
Facialtreatments
4.2
Handandbodylotions
3.2
COMPANYAVERAGE
2.2
2.0
Shampoos
(0.5)
Conditioners
(2.0)
(19.7)
4A212
LIMITEDBRANDS
Table5121:LimitedBrandsSalesofCosmeticsandToiletriesinthe
$Million
Category/brand
2011
FRAGRANCESFORWOMEN
2012
Bath&BodyWorks
248
260
VSFantasies
100
105
DreamAngelsHeavenly
95
100
Bombshell
50
53
Pink
25
27
Angel
24
26
Gorgeous
24
26
VerySexyforHer
14
15
Incredible
10
Rapture
SexyLittleThings
HenriBendel
BodybyVictoria
ParfumsIntimes
SecretMoments
Supermodel
VSNow
602
639
Bath&BodyWorks
420
437
102
105
Total
522
542
334
359
49
50
383
409
Total
HANDANDBODYLOTIONS
Bath&BodyWorks
Total
(Continued)
5214
LimitedBrands
Table5121:LimitedBrandsSalesofCosmeticsandToiletriesinthe
$Million
Category/brand
2011
2012
59
58
VictoriasSecret
EYEMAKEUP
VictoriasSecret
SHAMPOOS
Bath&BodyWorks
VictoriasSecret
Total
SUNCAREPRODUCTS
Bath&BodyWorks
22
22
12
13
19
20
18
18
20
17
FACIALTREATMENTS
PatriciaWexlerM.D.
Bath&BodyWorks
14
15
14
14
VerySexyforHim
Bath&BodyWorks
14
13
VictoriasSecret
Bath&BodyWorks
Total
1,706
1,785
FACEMAKEUP
VictoriasSecret
FRAGRANCESFORMEN
Total
CONDITIONERS
Bath&BodyWorks
VictoriasSecret
NAILPOLISHES
VictoriasSecret
TOTALr
rRestated.
4A214
LimitedBrands
COMPANYOVERVIEW
LimitedBrands,Inc.,foundedin1963,isbasedinColumbus,OH.
Limited Brands is a leading manufacturer and marketer of apparel, beauty, and
personalcareproducts,andaccessories.
As of February 2013, Limited Brands employs approximately 99,400 associates
worldwide,ofwhich79,800associatesworkparttime.
Limited Brands portfolio includes brands such as Victorias Secret, Victorias Secret Pink,
Bath&BodyWorks,C.O.Bigelow,WhiteBarnCandleCo.,LaSenza,andHenriBendel.
The company has three reportable businesses: Victorias Secret, Bath & Body Works, and
Other.
The Victorias Secret segment incorporates womens lingerie and other apparel,
personalcareproducts,andaccessories.
Bath&BodyWorkshaspersonalcareproductsandhomefragrances.
Limited Brands sells its merchandise through its specialty retail stores, websites, and
catalogs.
The company operates a wide distribution network of more than 2,876 retail stores
nationwideintheUnitedStatesasof2012.
In the United States, the company sells its products through 1,019 Victorias Secret
storesand1,571Bath&BodyWorksstores.
La Senza apparel is available in Canada and 32 other countries around the globe and
hascloseto330stores.
Total sales for Limited Brands increase to $10,459million in 2012, up by 0.9% from
However,netprofitsslide11.4%from$850millionin2011to$753millionin2012.
Since2007,salesforLimitedBrandshavegrownatacompoundaveragegrowthrate
(CAGR)of0.6%.
Table5122:LimitedBrandsGlobalCorporateSales,2007to2012
$Million
Year
Netsales
Netprofit
Marginonsales
2007
10,134
718
7.1
32.4
2008
9,043
220
2.4
11.7
2009
8,632
448
5.2
20.5
2010
9,613
805
8.4
54.5
2011
10,364
850
8.2
620.4
2012
10,459
753
7.2
(74.2)
Returnonequity
5215
5216
LimitedBrands
Victorias Secret, the companys largest division, accounts for $6,574million in sales, or
62.9%ofthecompanyssalesin2012,anincreaseof7.4%from2011sales.
Bath& Body Works registers an increase in sales from $2,674million in 2011 to
Table5123:LimitedBrandsGlobalCorporateSalesbyDivision,2011and2012
$Million
Division
2011
2012
VictoriasSecret
6,121
6,574
Bath&BodyWorks
2,674
Allothera
1,569
%Oftotal
2011
2012
Change,%
59.1
62.9
7.4
2,902
25.8
27.7
8.5
983
15.1
9.4
(37.3)
Total
10,364
10,459
100.0
100.0
0.9
aIncludesCorporate,MastGlobal,HenriBendel,andinternationaloperationsincludingLaSenza.
Sales of Limited Brands in the cosmetics and toiletries market grow 4.6% from
Table5124:LimitedBrandsCosmeticsandToiletriesSales,2007to
2012
Year
$Millionr
Change,%
2007
1,568
2008
1,512
(3.6)
2009
1,525
0.9
2010
1,602
5.0
2011
1,706
6.5
2012
1,785
4.6
rRestated.
4A216
LimitedBrands
FragrancesforwomencontinuestobethelargestrevenuegeneratingcategoryforLimited
Brandsinthecosmeticsandtoiletriesmarketin2012.
LimitedBrandsisthelargestmarketerofallfragrancesforwomen,witha23.5%share
during2012,upfrom23.0%in2011.
Salesgrow6.1%duringtheyear,from$602millionin2011to$639millionin2012.
All divisions of Limited Brands contribute to the companys growth as Bath & Body
Works,VictoriasSecret,andPinkexperiencegainsin2011.
New scents launched on a regular basis at favorable price points, along with
promotionalpricingonmultiplepurchasesistheprimestrategyforthesebrands.
Semiannual sales provide significant discounts on products to move merchandise,
makingwayfornewitems.
NewscentsfromBath&BodyWorksduringtheyearincludeCashmereGlow,Forever
Red,andLoveLoveLove.
Bath & Body Works repackages its body splashes and relaunches them as fragrance
mistsinearly2012.
The major womens fragrance launch for Victorias Secret is Incredible, launched at
approximatelythesametimeasthebraofthesamename.
Both Bath & Body Works and Victorias Secret experience enormous success in the
fragrances for women category, after having tried to capture the fragrances for men
categorytonoavail.
Bath&BodyWorksremainstheleadingbrandinthecategory,withsalesup4.8%from
The brand holds a 35.2% share of the specialty segment and a 9.6% share of the
category.
New fragrances added to its portfolio in 2012 include Cashmere Glow, Forever Red,
andLoveLoveLove.
Since2009,Bath&BodyWorkshasaddedhighendscentscomposedofseveralnotes
toitsportfolio,suchasCashmereGlowandForeverRed,andLoveLoveLovelaunched
in2012.However,thebrandstilloffersseveralofitsclassicscents,wherethenameof
thescentisdescriptiveofthefragrancenotes,suchasCountryAppleandCitrusMelon.
Bath&BodyWorksfragrancesaretypicallysomeofthelowestpricedscentsfoundat
theshoppingmallandthesefavorablepricepointsalongwithfrequentpromotionsand
itssemiannualsaleshelpgrowthebrand.
Promotionsareimportantforthesuccessofthisbrandwhichareofferedyearround
andincludebuythreegettwofreeandbuythreegetthreefreeoffers.
Additionally, the special online fragrance exclusive promotions are offered on the
brandswebsite.
Smallsizescentsalongwithtravelsizeversionsofnewreleasesaresoldnearthecash
registertoencouragetrialandimpulsepurchasing.
VS Fantasies, formerly Victorias Secret Garden, is the secondlargest brand in the
category, with a 5.0% increase in sales from $100million in 2011 to $105million in
2012.
VS Fantasies accounts for 14.2% of the specialty trade class and 3.9% of overall
fragrancessales.
Newscentsareaddedtotheline,andunderperformingonesarediscontinued.
Thecollectioncontinuestodowellduetoitsattractivepricepointsandregularlyoffers
promotionsofthreefor$24.00,orfivefor$30.00.
The Dream Angels Heavenly master franchise from Victorias Secret ranks third with
Thecompanyworkstopromoteitsnewerscents,suchasIncrediblelaunchedin2012.
5217
5218
LimitedBrands
LimitedBrandsistheleadingcompanyinthehandandbodylotionscategory,witha3.8%
growth in 2012. It is more than twice the size of the next leading company, Johnson &
Johnson.
Sales grow from $522million in 2011 to $542million in 2012 supported by new
productintroductionsandpackagingchangestoitsexistinglineofproducts.
LimitedBrandsrepresents23.7%shareofthetotalcategoryssalesin2012,upfroma
23.3%shareoftotalcategoryssalesin2011.
ThecompanyisrepresentedbyBath&BodyWorksandVictoriasSecretbrandsinthe
category.
Bath & Body Works sales advance 4.0% from $420million in 2011 to $437million in
2012.
Bath & Body Works product offerings in the category include body lotions, body
creams,bodybutters,footlotionsandcreams,andhandlotionsandcreams.
company.
Other popular product ranges for the brand include Forever Red, Paris Amour, and
CashmereGlow.
The Forever Red product line is a premium line and therefore is retailed at a higher
price.
Woods line of products that include a body lotion, moisture body cream, and body
butter;andBrownSugar&FiglineofproductswithabodyLotionandamoisturebody
cream.
As a part of its 2012 Holiday Traditions, the brand introduces the Vanilla Bean Noel
LotionandFrostedSnowberryBodyLotionforalimitedtimeperiod.
VictoriasSecretssalesadvance2.9%from$102millionin2011to$105millionin2012.
In2012,VictoriasSecretintroduceslimitededitionoftheSecretBombshellItalianIris
BodyLotion,ItalianBergamotBodyLotion,andVerySexyItalianMandarinLotion.Also,
new in 2012 are a number of Victorias Secrets Fantasies variants with exotic
fragrances.In2012,thePinklineofbodylotionsandbodybuttersundergoapackaging
changetogivethelineofproductsamorelivelyandfreshlook.
4A218
LimitedBrands
LimitedBrandsisthefourthleadingmarketerinthepersonalcleansingproductscategory
withsalesat$409millionin2012,up6.8%from$383millionin2011.
MarketshareofLimitedBrandsincreasesfrom9.8%ofthecategoryssalesin2011to
10.2%in2012.
Duetostableeconomicconditions,consumerpurchasingcapacityimproves,resulting
inmoredemandforspecialtybrands,suchasBath&BodyWorks
Limited Brands is the leading marketer in the bath additives segment, with sales at
Limited Brands has presence in the bath additives segment with Bath & Body Works
andVictoriasSecretGardenbrands.
LimitedBrandsisalsotheleadingmarketerintheantibacterialhandgelssegmentwith
ThemarketerispresentinthesegmentwithitsBath&BodyWorksbrand.
Limited Brands slides down to become the thirdleading marketer in the liquid soaps
segment, accounting for 20.5% of the marketers sales in 2012, marginally up from
20.4%in2011.
In2012,themarketerintroducesarangeofproductsforitsBath&BodyWorksbrand
including Pink Chiffon Pocketbac Sanitizing Hand Gel, Pink Chiffon Shower Gel,
CashmereGlowShowerGel,CashmereGlowGoldenSugarScrub,ParisAmourCreamy
Body Wash, Paris Amour Bubble Bath, Paris Amour Golden Sugar Scrub, Paris Amour
ShowerGel,PocketbacSanitizingHandGel,ForeverRedShowerGel,andForeverRed
GoldenSugarScrub.
The companys makeup product class contributes 5.3% to the companys total sales of
cosmeticsandtoiletriesin2012,downfrom5.6%in2011.
Lipsticksandlipglossescapturesthecompanyslargestshareinthetotalsalesinthe
makeup product class in spite of sales decline of 1.7% to $58million in 2012, down
The eye makeup category is Limited Brands secondlargest makeup category, with
salesof$22millionin2012,flatfrom2011levels.
Limited Brands sales in the face makeup product category remain stagnant at
$14millionin2012,flatfrom2011levels.
Thecompanydiscontinuesitsnailpolishescategoryin2012,withsalesslidingfroma
mere$1millionin2011tonegligiblesalesin2012.
Thefacialtreatmentscategorycontributes1.0%tocompanystotalsalesinthecosmetics
andtoiletriesmarketin2012.
Thecategoryssalesdecline15.0%from$20millionin2011to$17millionin2012.
5219
5220
LimitedBrands
Limited Brands hair care product class contributes 1.8% to the companys total cosmetics
andtoiletriessalesin2012.
Companysalesgrow3.1%,from$32millionin2011to$33millionin2012.
Shampoos contribute the major chunk of the sales in the hair care product class for
LimitedBrands.Shampoossalesgrow5.3%from$19millionin2011to$20millionin
2012.
Sales of the company in the conditioners category remain stagnant at $8million in
Salesinthehairstylingproductscategoryareflatat$5millioninbothyears.
SalesofLimitedBrandsinthelipbalms,jellies,andtreatmentscategorygrow7.1%,from
RECENTDEVELOPMENTS
Therearenoimportantdevelopmentsin2012.
InMarch2013,thecompanychangesitsnametoLBrands.
Newproducts
Table5125:SelectNewProductsIntroducedbyLimitedBrandsintheUnitedStatesin2012
Division/brand
Category
Description
Bath&BodyWorks
Personalcleansing
products
PinkChiffonShowerGelisafeminineblendofsparklingredpear,
vanillaorchid,andwhippedchiffonmuskfragrancesenriched
withvitaminE,aloevera,andsheabutterforacleaner,softer,
andbubblierexperience.Itisavailableinatravelsizeaswell
Bath&BodyWorks
Personalcleansing
products
PinkChiffonPocketbacSanitizingHandGelispocketsizedgerm
killerenrichedwithTahitianpalmmilktogivethehandsa
conditioningfeel.Itisscentedwithredpear,vanillaorchid,and
whippedchiffonmusk
Bath&BodyWorks
Personalcleansing
products
CashmereGlowShowerGelisablendofgoldenpeach,
shimmeringvanilla,andcashmeremuskfragrancesenrichedwith
vitaminE,aloevera,andsheabutterforacleaner,softer,and
bubblierexperience
Bath&BodyWorks
Personalcleansing
products
CashmereGlowGoldenSugarScrubcomprisessugarcrystals
whichexfoliatesandconditionswiththeapricotandsweet
almondoils.Itsfragranceisablendofgoldenpeach,shimmering
vanilla,andcashmeremuskandcomesinaneasytousesqueeze
tube
Bath&BodyWorks
Personalcleansing
products
ParisAmourCreamyBodyWashisenrichedwithTripleMoisture
Complexofmilkproteins,ricebranoil,berryextracts,andshea
butterforahydratingwash.ItsfragranceisablendofFrench
tulips,appleblossoms,andpinkchampagne
(Continued
4A220
LimitedBrands
Table5125:SelectNewProductsIntroducedbyLimitedBrandsintheUnitedStatesin2012
Division/brand
Category
Description
Bath&BodyWorks
Personalcleansing
products
ParisAmourBubbleBathisavitaminenrichedbubblebathwith
afragranceblendofFrenchtulips,appleblossoms,andpink
champagne
Bath&BodyWorks
Personalcleansing
products
ParisAmourGoldenSugarScrubcomprisessugarcrystalswhich
exfoliatesandconditionswithapricotandsweetalmondoils.Its
fragranceisablendofFrenchtulips,appleblossoms,andpink
champagne
Bath&BodyWorks
Personalcleansing
products
ParisAmourShowerGelisablendofFrenchtulips,apple
blossoms,andpinkchampagnefragrancesenrichedwithvitamin
E,aloevera,andsheabutterforacleaner,softer,andbubblier
experience.Itisavailableinatravelsizeaswell
Bath&BodyWorks
Personalcleansing
products
ParisAmourPocketbacSanitizingHandGelispocketsizedgerm
killerenrichedwithTahitianpalmmilktogivethehandsa
conditioningfeel.ItisscentedwithFrenchtulips,apple
Bath&BodyWorks
Personalcleansing
products
ForeverRedGoldenSugarScrubcomprisessugarcrystalswhich
exfoliateandconditionswithapricotandsweetalmondoils.Its
fragranceisablendofpomegranate,redosmanthus,andvanilla
rum
Bath&BodyWorks
Personalcleansing
products
ForeverRedShowerGelisablendofpomegranate,red
osmanthus,andvanillarumenrichedwithvitaminE,aloevera,
andsheabutterforacleaner,softer,andbubblierexperience
Bath&BodyWorks
Fragrancesfor
women
Newscentsduring2012includeCashmereGlow,ForeverRed,
andLoveLoveLove
VictoriasSecret
Fragrancesfor
women
Incredible,namedafterthelingerielaunchofthesamename,is
afloralfruityscentwithtopnotesofwhitepeachcombinedwith
pearandlotusaccords
VictoriaSecret
Handandbody
lotions
SecretBombshellItalianIrisBodyLotionisalimitededitionbody
lotionfromtheCiaoBellafragrancecollectionwithtopnotesof
Italianiris,whitepoppy,andorris
VictoriaSecret
Handandbody
lotions
VerySexyItalianMandarinBodyLotionisalimitededitionbody
lotionfromtheCiaoBellafragrancecollectionwithtopnotesof
Italianmandarin,bergamot,andcoconutmilk
VictoriaSecret
Handandbody
lotions
VSFantasiesDeepsofteningBodyButterisrestorativebody
butterenrichedwithsheabutter,cocoabutter,andvitaminE.It
isavailableinthreevariant:LusciousCrush,CitrusDream,and
LemonEscape
VictoriaSecret
Handandbody
lotions
VSFantasiesUltramoisturizingHandandBodyCreamisan
intensivehandandbodycreamenrichedwithavocadoand
sweetalmondoilsandhoneyfora24hourmoisturizing
experience.ItisavailableinthreevariantsLusciousCrush,Citrus
Dream,andLemonEscape
VictoriaSecret
Handandbody
lotions
VSFantasiesHydratingBodyLotionisafastabsorbingbody
lotionenrichedwithextractsofaloe,oat,andgrapeseedand
vitaminEandC.ItisavailableinthreevariantLusciousCrush,
CitrusDream,andLemonEscape
VictoriaSecret
Handandbody
lotions
ItalianBergamotBodyLotionisalimitededitionbodylotionfrom
theCiaoBellafragrancecollectionwithtopnotesofItalian
bergamot,waterbreeze,andspringdaffodils
5221
5222
LimitedBrands
MARKETINGACTIVITY
Limited Brands offers a visually stimulating environment along with knowledgeable sales
associates,pricepromotions,andaconstantflowofnewproductstoenticeconsumersto
makepurchases.
LimitedBrandscontinuestorelyheavilyonincreasedpromotionalactivitiesandheavy
discounts. Other mediums of advertising include sampling, emails, and direct mail
campaigns.
Limited Brands advertises its product through print advertisements in fashion and
beautymagazines,suchasAllureandGlamour.
Thecompanysinstore promotions throughits variousretailventuresformthemost
importantcomponentofLimitedBrandsproductpromotion.
Promotions,suchasgiftwithpurchase(GWP)andpurchasewithpurchase(PWP),are
offered around the year in Bath& Body Works stores. Buytwogetonefree and
Buythreegettwofreepromotionsarecommonthroughouttheyearinthesestores.
LimitedBrandsisalsoactiveonsocialmediasitessuchasFacebookandTwitter.
LeadingspecialtyretailbrandBath&BodyWorksandVictoriasSecretemploysthetacticof
positioning fragrance offerings in more than one location in a store, especially near the
checkoutcounters.
VictoriasSecretandBath&BodyWorksofferseveralscentsinsmallersizesnearthe
checkoutcountersforimpulsepurchasing.
Victorias Secret promotes its products using a number of promotional activities,
including two semiannual sales in June and January and directmailing campaigns
announcing new products and offers. Victorias Secret regularly offers promotional
dealsonitsvaluepricedFantasiesline.
Bath&BodyWorksregularlysendsoutoffersviaemailordirectmailtoconsumersin
its database offering price discounts on multiple purchases. Additionally, the retailer
sometimes offers samples of upcoming fragrance products, at introductory prices of
$1.00or$2.00.
Instore promotions that sport huge discounts are popular among specialty marketers.
LimitedBrandsusuallyadvertisesitsBath&BodyWorksbrandbyprovidingoffers,suchas
buytwogetonefreeandbuythreegetthreefreepromotionsonselectproducts.
Bath & Body Works helps clear its stock of goods through its two semiannual sales
heldinJanuaryandJune.Thesesalespavewayforthebrandslatestlineofproducts.
Thebrandalsoprovidescoupons,suchasa$10.00offonpurchaseofproductsworth
$30.00anddiscounts,suchas20.0%offontheentirepurchaseorbuyfourproductsfor
$15.00orsixfor$20.00.
Instore demonstrations prove to be an effective marketing tool and relationship
builder for associates. Bath & Body Works stay clear from television and magazine
advertisingandoftenutilizeinstoredemonstrationssincetheyhaveamorepersonal
touch. Window displays is another commonly used promotional tool utilized by the
company.
TheBath&BodyWorkswebsitecontainsalistofallproductsalongwithaspecialtab
for all the products on sale. The brand offers discounts on some of its products
throughouttheyear.Freeshippingonpurchasesabove$50.00isanotherpromotional
toolwhichisoftenusedbythemarketer,especiallyduringtheholidayseasonof2012.
4A222
LimitedBrands
OUTLOOK
Duringtheforecastperiod,2012to2017,thecompanyisforecasttoshowapositivegrowth
of 3.4% in the cosmetics and toiletries business. Its dominance in key categories in the
cosmeticsandtoiletriesindustryisexpectedtoprevail.
With improved conditions in the economy, the marketer is likely to introduce
innovativeproductswithrespecttoadvancedtechnology,packaginganddesignchange,
changeinformulations,andexoticblendoffragrances.
The marketer is expected to command higher prices for these new and innovative
productstomeetthecostofproducingthemduringtheforecastperiod.
The company will continue to introduce new scents throughout the year, along with
giftpackagesandpromotionalpricingformultipleproductspurchased.
Bath&BodyWorkswillcontinuetointroducetravelsizeoptionsforitsvariouslinesof
productsfromitsSignatureCollectionintheformoffragrancemists,bodylotions,and
showergels.
Additionally,LimitedBrandswilloffercustomerstheflexibilitytocarrytheseitemsas
theyare3ounceseach,andmeetairlinecarryonluggagerequirements.Thiswillprove
tobeanadvantageforthecompanyaswell,becauseofthehigherpriceperounceof
product.
The fragrances product class will continue to be the leading product class, with its sales
forecasttogrowataCAGRof3.2%inthefiveyearforecastperiod.
The company is expected to develop new products in the fragrances for women
categorywithdistinctivefeatures.
ThemarketerbenefitsfromthesemiannualsalesheldforitsBath&BodyWorksand
VictoriasSecretbrands,whichbringinextrarevenueduringtheholidayseason.
Thecompanywillcontinuetoinnovateandintroducevariousoptionswithrespectto
sizes,giftpacks,andGWPforconsumerstopurchaseanycombinationtheylike.
The marketer is likely to witness the most growth from the personal cleansing products
categoryduringtheforecastperiod,ending2017.
Bath& Body Works sales will continue to benefit from its loyal customer base and
continual improvement in its product assortment, new scents, and improved
formulations.
ThemarketerislikelytokeepitsBath&BodyWorksandVictoriasSecretbrandsalive
andfreshwithchangesinpackaginganddesignatregularintervals.
Themarketerwillcontinuetoinnovatewithnewfragranceblendsespeciallydesigned
fordifferentseasonsoftheyear.
However, Limited Brands will face competition from mass brands that will try and
emulate the marketers product offerings with respect to fragrances, formulations,
benefits,andpackagingdesigns.
5223
5224
LimitedBrands
HandandbodylotionswillcontinuetobeasignificantcategoryforLimitedBrands.
Bath&BodyWorkssaleswillcontinuetobenefitfromitsloyalcustomerbase.
Limited Brands will continue to introduce hand and body lotions with innovative
fragrance blends for its Bath & Body Works and Victorias Secret brands in order to
offerconsumerawiderselectionofproducts.
The packaging will be refreshed at regular intervals of time to add spark to the
productslabelingdesign,changeintheshapeofbottles,anddispensingformat.
ThecompanyisexpectedtoreceiveincreasedTMEallocationthrough2017.
LimitedBrandsisexpectedtocontinuewithrestrainedmediaexpenditures.
Limited Brands will continue to attract consumers with its aggressive consumer
promotionstoensuresalesgrowth.
Catalogs and instore promotions will continue to be the mainstay of the companys
promotionaleffortsinthefiveyearforecastperiod.
Itwillcontinuetosupportallnewproductlaunchesthroughprintadvertisementsinits
catalogs,andthroughthedistributionofsamplesandGWPoffers.
LimitedBrandssupportsBath&BodyWorksandVictoriasSecretthroughouttheyear
with regular email and direct mail campaigns, largescale sales events, catalogs, and
frequentGWPandPWPoffers.
LimitedBrandswillcontinuetosendoffersviaemailordirectmailtoconsumersinits
databaseofferingpricediscountsonmultiplepurchases.
ThemarketerisincreasinglyusingsocialmediasitessuchasFacebookandTwitterfor
instantaccesstoconsumers.
Tohelpboostsalesfortheendofyearholidays,Bath&BodyWorkswillcontinuewith
itsholidaypromotionsfromOctoberthroughDecember.
TheholidayseasonsandthecompanyssemiannualsalesthatisgenerallyheldeveryJune
andJanuary,whenspecialpricebasedpromotionsareconducted,willcontinuetogenerate
increasedsalesincomparisontotherestoftheyear.
These events will continue to contribute to a significant portion of sales during the
forecastperiod.
Duringthesalesevents,Bath&BodyWorksproductsareofferedatsteeplydiscounted
prices,resultinginhighsalesvolumes.
Themarketerislikelytoshowstagnantgrowthintheconditioners,hairstylingproductsand
sprays,lipbalms,jellies,andtreatments,andskincareproductsformencategoriesdueto
thelackoffocusonthem.
Therehasbeennegligiblenewproductactivityinthesecategoriesandthemarketeris
notexpectedtomakeanygroundbreakinginnovationinthemtospursalesduringthe
forecastperiod.
Sales of Limited Brands cosmetics and toiletries business are projected to increase at a
CAGRof3.4%toreach$2,108millionby2017,upfrom$1,785millionin2012.
4A224
LimitedBrands
ToiletriesforLimitedBrandsbyCategory,2012to2017
Category
CAGR,%
4.7
Handandbodylotions
3.5
COMPANYAVERAGE
3.4
Fragrancesforwomen
3.3
Fragrancesformen
1.5
Facemakeup
1.4
Facialtreatments
1.1
Suncareproducts
1.1
Shampoos
1.0
Eyemakeup
0.9
Conditioners
(1.1)
5225
5226
LimitedBrands
4A226
LORAL
Table5127:LOralsSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
EYEMAKEUP
2012
Maybelline
422
446
LOralParisr
257
266
Lancme
122
128
31
40
10
841
890
Lancme
230
243
LOralParis
220
227
Garnier
61
76
Skinceuticals
57
61
Kiehls
44
52
LaRochePosay
22
27
Maybelline
TheBodyShop
Vichy
ShuUemura
657
709
UrbanDecay
YSLBeaute
Totalr
FACIALTREATMENTS
Total
L'OralExcellenceCrme
146
152
Preference
153
151
GarnierNutrisse
92
97
Fria
78
73
NaturalMatch
23
21
L'OralCouleurExperte
22
21
(Continued)
5228
LOral
$Million
Category/brand
2011
HAIRCOLORINGPRODUCTS(Continued)
ColourRays
17
17
PreferenceLesBlondissimes
15
13
HiLightStyliste
13
13
FrostNDesign
ToneRefiner
70
72
648
646
Maybelline
208
235
LOralParis
175
188
Lancme
112
117
UrbanDecay
17
26
YSLBeaute
10
11
Dermablend
529
584
136
134
Matrix
46
47
Redkenr
29
30
L'OralParisEverPurer
18
19
L'OralParisVivePror
16
13
Pureology
14
13
L'OralParisEverSleek
10
10
L'OralParisEverStrongr
L'OralParisEverCreme
LOralKids
284
287
Garnier100%Color
Allother
Total
FACEMAKEUP
Totalr
SHAMPOOS
GarnierFructisr
Totalr
(Continued)
4A228
2012
LOral
$Million
Category/brand
2011
CONDITIONERS
116
115
Matrix
43
44
Redken
29
30
L'OralParisEverPurer
17
18
Pureology
13
13
L'OralParisVivePror
14
11
L'OralParisEverSleek
L'OralParisEverStrong
L'OralParisEverCreme
LOralKids
250
253
Maybelliner
85
91
LOralParis
88
83
Lancmer
31
32
UrbanDecay
20
22
231
236
GarnierFructis
84
82
Redken
57
59
Matrix
49
51
StudioLine
39
35
229
227
GarnierFructisr
Totalr
YSLBeaute
Totalr
2012
Total
FRAGRANCESFORMEN
AcquadiGi
50
53
ArmaniCode
24
24
PoloBlue
21
21
Polo
14
15
LHommeYvesSaintLaurent
13
14
PoloBlack
13
13
(Continued)
5229
5230
LOral
$Million
Category/brand
2011
DrakkarNoir
LaNuitdeL'Homme
L'HommeLibre
BigPony1
BigPony3
PoloDoubleBlack
ArmaniCodeSport
BigPony2
BigPony4
Spicebomb
PoloSport
OnlytheBrave
DieselFuelforLifeforHim
PoloExplorer
Chaps
14
14
214
216
Allother
Total
FRAGRANCESFORWOMEN
Viktor&RolfFlowerbomb
22
27
Romance
20
20
Trsor
17
15
AcquadiGiia
15
14
LaVieEstBelle
14
Opium
12
11
TheBodyShop
10
10
ArmaniCodeforWomen
Miracle
Hypnse
Ralph
BigPony2
TrsorInLove
(Continued)
4A230
2012
LOral
$Million
Category/brand
2011
2012
Oscar
Boucheron
TrsorMidnightRose
PalomaPicasso
AmorAmor
AnasAnas
EmporioArmaniforHer
IdoledArmani
Poeme
Notorious
Stella
Paris
18
19
167
181
31
68
LOralParis
21
Maybelline
10
Lancme
YSLBeaute
40
104
Dark&Lovelyhaircoloringproducts
22
23
Dark&Lovelyrelaxerkits
18
16
OptimumCarerelaxerkits
16
15
Dark&Lovelystylingaids
Dark&Lovelyshampoos
Dark&Naturalhaircoloringproducts
LetsJamstylingaids
Allother
Total
NAILPOLISHES
Essier
Totalr
CareFreeCurl/CareFreeCurlGoldCurl/wave
maintenanceproducts
(Continued)
5231
5232
LOral
$Million
Category/brand
2011
ETHNICHAIRCAREPRODUCTS(Continued)
2012
OptimumCarehairdressesandlotions
Optimumshampoosandconditioners
OptimumCarestylingaids
SportinWaveCurl/wavekits
Dark&NaturalCurl/wavemaintenanceproducts
OptimumOilTherapyhairdressesandlotions
SoftsheenBreakthrushampoosandconditioners
SoftsheenBreakthruhairdressesandlotions
BeautifulBeginningsrelaxerkits
97
95
LOralParis
24
28
Lancme
12
12
LaRochePosay
11
13
Total
47
53
Total
SUNCAREPRODUCTS
HANDANDBODYLOTIONS
TheBodyShop
33
34
LOralParis
Lancme
38
38
14
14
Kiehls
LOralMensExpert
Lancmeformen
14
14
Total
TheBodyShopbathadditives
Total
Magic
Lancme
TOTALr
4,304
rRestated.
NOTE:"Allother"includessalesofsmallerbrandsthatthecompanyowns.
4A232
4,551
LOral
COMPANYOVERVIEW
HeadquarteredinParis,France,LOralisoneoftheworldslargestmarketersofcosmetics
andtoiletries.
Thecompanywasfoundedin1909byFrenchchemistEugneSchueller.
LOral operates five development centers, 38 factories, and 18 research centers
worldwide;thecompanyemploysabout72,600peoplein2012.
GlobalfoodandbeverageindustrymajorNestlholdsa29.7%directstakeinLOral.
ThecompanyoperatesintheUnitedStatesthroughitsLOralUSAsubsidiary,basedin
NewYork,NY.
LOralhasaportfolioof27globalbrandsthathaveannualrevenuesof50millionormore.
Productsaresoldinmorethan130countries.
The companys core business is cosmetics and toiletries, encompassing all product
classes.
As of 2012, the company allocates 791 million ($1,017 million) in its research and
innovationbudget,upfrom721million($927million)apportionedin2011.
In2012,LOralregisters611patentsincosmeticsanddermatologicalresearch,slightly
downfrom613patentsin2011.
LOralisorganizedintothreemainbranches.
TheCosmeticsbranch,whichencompassesthehaircare,makeup,fragrances,andskin
carecategories,generatesthemajorityofsales.
TheBodyShop,acquiredbyLOralin2006,operatesasanindependententitywithin
thecompanyandsellsonlyTheBodyShopbrandedproducts.
The Dermatology branch consists of Galderma Laboratories, a joint venture between
LOral and Nestl. Galderma manufactures and markets specialty skin care products
designedtomeettheneedsofdermatologistsandtheirpatients.
LOralsCosmeticsbranchconsistsoffourdivisions.
Consumer Products is the largest division that markets mass skin care and cosmetics
productsunderbrandnamesLOralParis,Garnier,MaybellineNewYork,Softsheen
Carson,andEssie.
LOral Luxury markets premiumpriced products that are sold through department
stores, other luxury retail outlets, and online retailers. This division handles brands
such as Kiehls, Ralph Lauren, Lancme, Yves Saint Laurent, Giorgio Armani, Helena
Rubinstein,andClarisonic.
The companys Professional Products division markets hair care products for take
homeandbackbarsalethroughprofessionalsalons.Brandsmarketedbythisdivision
includeLOralProfessional,Krastase,Redken,andMatrix.
The Active Cosmetics division markets its brands chiefly through drug stores,
pharmacies,dermatologists,andmedispas.Thedivisioncomprisesdermocosmeticskin
carebrands,suchasVichy,LaRochePosay,Innov,Roger&Gallet,andSkinCeuticals.
5233
5234
LOral
LOralestablishesGlobalHairCareResearchCenterin2012.Thisresearchcentreheadssix
regionalresearchandinnovationcenterslocatedinBrazil,China,France,India,Japan,and
theUnitedStates.
Thecompanyinvests100million($129million)tosetupthisresearchCentrebasedat
SaintOuen,Paris.
Global Hair Care Research Centre originates, formulates, and assesses hair coloring,
haircare,andstylingproducts.
The Centre employs 500 personnel that include materials scientists, opticians,
computer scientists, statisticians, metrologists, physicochemists, chemists, and
rheologists.
LOral continues to grow, as corporate sales increase by 10.4% to reach 22,463 million
($28,869million)infiscalyear2012.
Net profits grow from 2,438 million ($3,133 million) in 2011 to 2,868million
($3,686million)in2012.
Total company sales have grown at a compound annual growth rate (CAGR) of 5.7%
since2007.
Table5128:LOralsGlobalCorporateSalesandProfits,2007to2012
Million
Year
Sales
Netprofit
Marginonsales,%
2007
17,063
2,658
15.6
2008
17,542
1,951
11.1
2009
17,473
1,795
10.3
2010
19,496
2,242
11.5
2011
20,343
2,438
12.0
2012
22,463
NOTE:$1.00=0.7781.
2,868
12.8
Table5129:LOralsGlobalSalesbyBranch,2012
Branch
Million
Cosmetics
%Oftotal
20,812
92.7
TheBodyShop
855
3.8
Dermatology
796
3.5
22,463
100.0
Total
NOTE:$1.00=0.7781.
4A234
LOral
Table5130:LOralsGlobalSalesbyDivision,
2012
Division
%Oftotal
ConsumerProducts
51.5
LuxuryProducts
26.8
ProfessionalProducts
14.4
ActiveCosmetics
7.3
Total
100.0
LOral continues to be the secondlargest marketer, behind Procter & Gamble, in the
cosmeticsandtoiletriesindustryintheUnitedStatesin2012.
LOralfindspresencein18ofthe26productcategoriescoveredinthisstudy.
LOralexperiencesahealthygrowthof5.7%in2012.
Salesgrowfrom$4,304millionin2011to$4,551millionin2012.Saleshavegrownata
CAGRof2.8%since2007.
Table5131:LOralsSalesofCosmeticsandToiletries
Year
$Million
Change,%
2007
3,961
2008
3,924
(0.9)
2009
3,897
(0.7)
2010
4,056
4.1
2011
4,304
6.1
2012
4,551
5.7
Eyemakeup,theleadingcategoryforLOral,accountsfor19.6%ofthecompanyssalesin
2012.
LOralistheleadingeyemakeupmarketerin2012withsalesof$890million,up5.8%
LOral increases its share slightly as the company outperforms the overall market
growthforthecategory.
LOral is the leading advertiser in the eye makeup category with traceable media
expenditure(TME)of$204.2millionin2012,sameasin2011.
Maybelline is the largest advertised brand from LOral in 2012, with TME of $133.4
million,up8.5%from$122.9millionin2011.
5235
5236
LOral
LOralParisissupportedwith$59.2millioninadvertisingdollarsin2012.TMEdeclines
8.1%in2012comparedtothelevelofsupportthebrandreceivedin2011.
AllofLOralsbrandscontributetothecompanysgrowthastheyoutpacetheoverall
marketgrowthof3.4%.MaybellineandLOralPariscontributethemostdollars,while
Urban Decay and YSL Beaute experience doubledigit gains of 29.0% and 11.1%,
respectively.
Maybellineistheleadingbrandintheeyemakeupcategoryandoutpacesthemarket,
growing5.7%toreach$446millionin2012,upfrom$422in2011.
Lancmessaleswith4.9%growthreach$128millionin2012,upfrom$122millionin
2011.
GrowthofMaybellineisfromthelaunchofitsnewmascaras,eyebrowcollection,and
eyeshadows.Eyelinersalesforthebrandareflatin2012.
MaybellineexpandsitsshareintheeyebrowsegmentwithitsEyeStudioMasterShape
Brow Pencil and DefineABrow product. Maybelline also has success with its Volum
ExpresstheMegaPlushandIllegalLengthfiberextensionmascaras.Salesgaincomes
fromitsColorTattoo24hrCreamGelShadow.
Lancmes growth comes from many products within the eye shadow, mascara, and
eyebrows segments. The brand is known for its mascaras, and in 2012 Hypnose Star
andHypnoseDollLashescontributetoLancmessuccessinthesegment.
UrbanDecayssalessoarduetothepopularityofitsNakedeyeshadowpalettes.
Facial treatments is the secondlargest category for LOral. The category accounts for
15.6%ofthemarketerstotalsalesin2012.
LOralsLancmeremainsthethirdlargestbrandintheluxurysegment,withsalesof
Sales continue to grow due to the success of Visionnaire Advanced Skin Corrector,
whichmadeitsdebutin2011,andGnifiquewhichwaslaunchedin2010.
The Gnifique line is extended with the launch of Gnifique Yeux LightPearl
Illuminating Youth Activating Concentrate, made specifically for the eyes with a
rotatingandmassagingapplicator.
TheRnergielineexpandswithaMultiLiftActionproductthatlifts,firms,smoothens,
andprotects.
The Absolue line is extended with LExtrait a regenerating product containing rose
nativecellstohelprevealfirmer,moreelastic,andradiantskin.
Total advertising expenditures for Lancme are approximately $33.7 million in 2012,
downfrom$39.8millionin2011.
LOralParisfromLOralremainsthethirdlargestmassbrandinthecategory.
Manufacturers sales of LOral Paris increase 3.2% to $227million in 2012, up from
$220millionintheprioryear.
TwonewproductslaunchundertheYouthCodeline.YouthCodeBBCreamilluminator
is one of the first mass BB creams. Youth Code is also extended with a foaming gel
cleanser.
4A236
LOral
RevitaLiftlineisextendedwiththelaunchofTriplePower,alineofconcentratedfacial
treatmentproducts,targetedtorepairandfightwrinkles.Thecompanyclaimsthatthe
TriplePowerrangecontainsthehighestlevelsofthecompanysproprietaryProXylane,
which is a molecule extracted from the beechwood tree, said to enhance collagen
production.TheTriplePowerrangehasthehighestpricepointsofanyproductsinthe
LOral Paris portfolio, and is the first mass brand to directly compete with Olays
premiumpricedProX.
Advertising expenditures for facial treatment products from LOral Paris are
approximately $25.0 million during 2012, down considerably from $129.1million
during2011.
Haircoloringproducts,themarketersthirdlargestcategoryinthecosmeticsandtoiletries
industry,represents14.2%ofthecompanyssalesin2012.
In 2012, LOral continues to be the leading marketer in the hair coloring products
category.
LOralaccountsforanestimated49.1%ofthecategoryssalesin2012.
Salesdeclinemarginallyby0.3%from$648millionin2011to$646millionin2012.
LOraldecreasesitsmarketingactivity,whichcontributestoitssalesdeclinein2012.
ThemarketerallocatesTMEofapproximately$164.8millionin2012,down11.4%from
LOralsproductofferingsmainlycomprisepermanenthaircolors.
brandsofthecompany.
LOralsleadingbrand,L'OralExcellenceCrme,postsagrowthof4.1%in2012,and
GarnierNutrisseexperiencesgrowthof5.4%, whereasL'OralPreferencedeclinesby
1.3%.
ThemarketersupportsthesalesgrowthofL'OralExcellenceCrmewithanincreasein
TMEin2012.ThemarketerallocatesaTMEofapproximately$32.7millionin2012,up
from$21.2millionin2011topromotetheL'OralExcellenceCrme.
Garnier Nutrisse enjoys a growth of 5.4% in 2012, with sales reaching $97million in
Sales of Garnier Nutrisse are supported by the launch of Garnier Nutrisse Nourishing
HairColorFoamin2012.
In spite of new product activity and significant TME support of $18million in 2012,
salesofFriadeclineto$73millionin2012,down6.4%from$78millionin2011.
NaturalColorMatchexperiencesadeclineof8.7%to$21millionin2012,downfrom
$23millionin2011.
In 2012, sales of Couleur Experte decline by 4.5%, from $22 million in 2011 to
$21millionin2012.
SalesofColourRaysremainstagnantat$17millionin2012,sameas2011levels.
Preference Les Blondissimes, a line targeting blonde consumers, declines further to
Smallerlighteninghaircolorlines,Frost&DesignandToneRefiner,remaindormantin
2012at$8millioneach.
A few distinct hair color lines, such as Superior Preference and Wild Ombre, are
launchedin2012.
5237
5238
LOral
SalesofLOralinthefacemakeupcategorygrow10.4%to$584millionin2012,upfrom
$529millionin2011.
LOral takes the top spot away from Este Lauder in 2012 with 20.1% of total
SalesforthecompanyincludesalesfromUrbanDecay,abrandthecompanyacquires
fromprivateequityfirmCastaneaPartnersinNovember2012.
LOralsupportsitsfacemakeupbrandsbyincreasingitsadvertisingexpensesby9.4%
to$195.2million,upfrom$178.3millionin2011.
LOralcompetesinthefacemakeupcategorywithLOralParis,Maybelline,Lancme,
UrbanDecay,YSLBeaute,andDermablendbrands.WiththeexceptionofDermablend,
allbrandscontributetothegrowthofthecompany.
Thecompanysmassbrands,MaybellineandLOralParisanditsnewlyacquiredbrand,
UrbanDecay,drivethemajorityofgrowthin2012withdollargainsof13.0%,7.4%,and
52.9%,respectively.
Maybellinecontinuestobetheleadingbrandforthecompanyin2012,with salesof
Maybellinesgrowthisdrivenbyallsegmentsinthefacemakeupcategory.Concealer
salesarefollowedbymakeupbases,andblushsales.NewlaunchesincludeInstantAge
Rewind Eraser Dark Spot Concealer+Treatment, Dream Nude Airfoam makeup, and
DreamBouncyblushfuelgrowth.
LOralsupportsMaybellinesDreamlineofproductswithapproximately$65millionin
TMEin2012.
LOral supports Maybellines Instant Age Rewind line of face products with
approximately$84millioninTMEin2012.
LOral reduces its advertising for its Maybelline Fit Me line from $63 million in TME
duringitslaunchin2011to$7.5millionin2012.
SalesofLOralParisareestimatedat$188millionin2012,up7.4%from$175million
in2011.
LOralParisgrowthisachievedbynewlaunchactivitiesespeciallyinthemakeupbase
categoryasarangeofnewproductshitshelvesin2012.Theseproductsarewithinthe
TrueMatchandVisibleLiftproductlines.
TMEforLOralParisincreasesin2012to$91million,sameasin2010,afteradecline
in2011to$75million.Approximately,88%ofthedollarsaresplitbetweenpromoting
the True Match and Visible lift makeup lines and close to 10% is spent on the Magic
Lumilineoffaceproducts.
TheluxurybrandLancmeachievessalesof$117million,up7.4%from$112millionin
2011.Salesincreaseduetothesuccessofexistingproducts,andtoalesserextentdue
to new launches. Lancme is supported with approximately $11.5 million in TME in
2012, up 10% from 2011. These dollars are in support of Teint Idole Ultra 24H
foundation,TeintMiraclefoundation,andonBlushSubtil.
TheluxurybrandsYSLBeauteandGiorgioArmaniMaestroaresupportedbyclosetoa
halfamilliondollarseach,tosupporttheTouceEclatandliquidfoundationproducts,
respectively.
4A238
LOral
Sales of hair styling products for LOral decline 0.9% from $229 million in 2011 to
$227millionin2012.
Despitethedecline,themarketermaintainsitspositionasthesecondleadingmarketer
inthehairstylingproductsandsprayscategorywithashareof13.5%ofthecategory
sales,downfrom13.8%ofthecategorysalesin2011.
Decreaseinthemarketingandpromotionalactivitiescontributetothesalesdeclinein
2012.LOraldecreasesitsTMEspendbyapproximately35.7%,from$60.5millionin
GarnierFructisistheleadingbrandofthecompany,withsalesat$82millionin2012,
Despiteawiderangeofproductofferingsandwellestablishedpositioning,thebrand
declinesin2012.
Thebrandssalesdeclinein2012isduetoadecreaseinmarketingactivities.
LOral is the leading marketer in the professional trade class in the category, with
RedkentheleadingbrandandMatrixinthirdposition.
The marketer occupies 21.8% of the professional trade class sales, up from 21.2% in
2011.
Theshampooscategoryrepresents6.3%ofLOralssalesin2012.
LOral is the thirdlargest marketer in the category with an 11.0% share; the
companyssalesgrow1.1%from$284millionin2011to$287millionin2012.
Thecompanyoffers10brandsinthecategory.
Garnier Fructis is the leading brand from LOral, and sales decline 1.4%, from
$136millionin2011to$134millionin2012.Limitednewproductactivityoffsetsthe
brandsgrowthinthecategory.
ThesalesofEverPuregrow3.3%,from$18millionin2011to$19millionin2012.The
successofsulfatefreeshampoossupportsthebrandssalesinthecategory.
ViveProfromLOralcontinuestodeclinein2012;salesforthebranddecline18.8%,
from $16million in 2011 to $13million in 2012. Limited distribution and lack of new
productactivityaffectsthebrandsperformance.
LOral markets two professional hair care brands: Matrix and Redken. Matrix
witnessesa2.2%growthin2012,withthebrandssalesincreasingfrom$46millionin
2011 to $47million in 2012. The brands growth is supported by new product
introductionsin2012.LOrallaunchesanewBlondeCareshampooundertheMatrix
brand in 2012. Redken grows 3.4% from $29million in 2011 to $30million in 2012.
RedkenlaunchesAllSoftandBlondeGlamshampoosin2012.
Salesintheconditionerscategoryaccountfor5.6%ofLOralsalesin2012.
LOral is placed third in the category with a share of 15.3%. Sales for the marketer
grow1.2%from$250millionin2011to$253millionin2012.
ThelargestbrandfromLOralisGarnierFructis,whichhasashareof7.0%ofthetotal
categoryssales.
Garnier Fructis is the secondlargest brand in the category. Sales for Garnier Fructis
declineby0.9%from$116millionin2011to$115millionin2012.
5239
5240
LOral
TheonlysignificantlaunchundertheGarnierFructisbrandisPureCleanconditioner.
EverPure,thelineofsulfatefreeconditionersintroducedin2011,continuestoperform
wellforLOralin2012.
Thebrandgrowsby5.9%from$17millionin2011to$18millionin2012.
ThesuccessofEverPureandEverSleekandthegrowingconsumerconcernaboutharsh
chemicalsusedinhaircareproductspromptsLOraltolaunchafourthlineofsulfate
freeproducts.Thenewline,EverCreme,hassalesof$5millionduringitsfirstyearof
launchin2012.
Vive Pro, the variant under the LOral Paris umbrella, continues to witness sales
decline in 2012. Sales for the brand shrink from $14million in 2011 to $11million in
2012.
Salessufferduetolimitedpromotionalspendingandlackofnewproductactivityfrom
thebrandin2012.
LOralistheleadingmarketerintheprofessionaltradeclass,withashareof24.7%in
2012.
The company markets the top professional conditioner brand Matrix. Sales for the
brandgrow2.3%from$43millionin2011to$44millionin2012.
SalesforRedkengrowby$1millionto$30millionin2012.Newconditionersunderthe
DiamondOilandAllSoftlineareaddedtoRedkensofferingsin2012.
The sales of the brand Pureology, offering color protection products, remain flat at
$13millionin2012.
LOralmaintainsthetopspotastheleadingmarketeroffragrancesformenwitha19.6%
categorysharein2012.
Salesgrow0.9%or$2millionto$216millionbasedonthestrengthoffragrances,such
asAcquadiGi,ArmaniCode,andthePolofranchise.
Sixofthetop10scentsbelongtoLOral.
The companys Acqua di Gi continues to be the leader among male fragrances with
$53millioninsales,$8millionaheadofsecondplacedChanelsBleu.
Salesreach$53millionin2012,agrowthof6.0%from$50millionintheprioryear.
Thebrandsshareoftheluxurytradeclassremainsflatat6.9%,whileshareofthetotal
mensfragrancemarketgrowsfrom4.7%to4.8%during2012.
ArmaniCoderanksfourth,andPoloBlueremainsinsixthposition.
LOralcontinuestorelyonitsassociationwithclassicdesignersforitsscentsincluding
Giorgio Armani, Ralph Lauren, Yves Saint Laurent, and Viktor & Rolf, and growth is
experiencedduring2012becausemostoftheclassicsperformwell.
Theluxurytradeclassistheonlytradeclassinwhichthecompanycompetes.However,
whensomeofitsproductsdoendupinmassretailers,itistypicallyduetodiversion
ratherthananintentionaleffortbythecompany.
The major launch of the year is Viktor & Rolfs Spicebomb, with sales of $4 million
during2012.
4A240
LOral
LOral is the leading marketer in the lipsticks and lip glosses category in 2012. Category
salesforthecompanytotal$236millionin2012,up2.2%from$231millionin2011.
LOralrepresents17.1%ofthecategoryssalesin2012,unchangedfrom2011.
LOralistheleadingadvertiser,withTMEat$130.8millionin2012.
LOral competes in the category with its mass brands, LOral Paris and Maybelline,
anditsluxurybrands,Lancme,YSLBeaute,andUrbanDecay.Allbrandscontributeto
thecompanysgrowthin2012,exceptLOralParis.Maybellineaddsthemostdollars,
whileitsnamesakebranddeclines5.7%in2012.SalesofLOralParisColourRicheand
Colour Caresse line of products perform well and are supported with TME of $25
million.However,LOralParisdoesnotfarewellwithitsInfalliblelipsticklinedespite
spending$19millioninTMEin2012.
Salesofthecompanysmassbrandsareuponly0.6%in2012,achieving$174millionin
sales.
Maybellineperformsverywellin2012,withsalesincreasing7.1%toreach$91million
in2012,upfrom$85millionin2011.Thebrandisontrendwithnewlaunchesin2012.
The brand capitalizes on what interests women, the gloss that stays on, and high
pigment lipsticks that stays on and feels creamy. Maybelline launches two new
products: Super Stay 10hour Stain Gloss and Colorsensational Vivids lipsticks. The
launchoftheseproductsissupportedwithcloseto$78millioninTME.
Sales of LOrals luxury brands grow 6.9% in 2012 to reach $62 million from $58
million.BothLancmeandYSLBeautehavesuccessfullaunchesinRougeinLoveand
RougePurCoutureVenisaLevers,respectively.Bothproductsaresupportedwithclose
to$9millioninTME.
LOraldropstofifthplacewith6.7%shareinthewomensfragrancescategoryin2012.
LOralcontributes4.0%ofitstotalsalesofthecompanyin2012.
ThebiglaunchoftheyearisLaVieEstBellewhichattainssalesof$14millionwithin
justafewmonthsofitslaunch.
Viktor&RolfsFlowerbombcontinuestogrowwithincreasingdistribution,asthisscent
joinsthetop10withjustafewyearsoncounter.
TheonlyothermajorlaunchduringtheyearisthefemaleversionsoftheRalphLauren
Polocollection,however,thesedidnotperformaswellastheirmalecounterparts.
AlthoughtheshareofLOralintheoverallethnichaircareproductscategorydeclinesfrom
29.1%in2011to27.9%in2012,thecompanymaintainsitsreigningpositioninthecategory.
Salesofthecompanydecline2.1%,from$97millionin2011to$95millionin2012.
Lackofsignificantmarketingandpromotionalactivitycontributestothesalesdecline
forthemarketerin2012.
In 2012, LOral introduces Dark and Lovely Au Naturale antibreakage maintenance
andstylingline,alongwithafewotherproductintroductionstooffsetitssalesdecline.
LOralsupportsitsbrandswithaninsignificantTMEofamere$0.2millionin2012.
Dark & Lovely is the leading brand in the market accounting for 14.1% of the overall
Salesforthebranddeclinefrom$49millionin2011to$48millionin2012.
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LOral
Dark&Lovelyistheleadingbrandinhaircoloringproducts,relaxerkits,whileinstyling
itisthesecondleadingbrand.
Lackofmarketingandpromotionalactivitycontributestothebrandssalesdeclinein
2012.
OptimumCareisthesecondleadingbrandforLOralwithanoverallcategoryshareof
6.6%in2012,downfrom6.2%in2011.
Salesofthebranddecline4.5%from$22millionin2011to$21millionin2012.
In the sun care products category,sales of LOral grow 12.8% to $53 million in 2012, up
TheintroductionofLOralsSublimeSunisthekeyreasonbehindthestronggrowthof
thecompany.
TheSublimeSunproductcomprisessixSKUs:AdvancedSunscreenSPF50+LiquidSilk
Sunshield for Face, Advanced Sunscreen SPF 50+ Lotion, Advanced Sunscreen SPF 30
Lotion, Advanced Sunscreen SPF 50+ Crystal Clear Mist, Advanced Sunscreen SPF 30
CrystalClearMist,andAdvancedSunscreenSPF30HydraLotionSpray.
ThelineissupportedwithaTMEof$14.5millionin2012.
Alsoin2012,LOralintroducesfournewSKUsforitsLaRochePosaybrand:Anthelios
30UltraLightSunscreenLotionSpray,Anthelios60UltraLightSunscreenLotionSpray,
Anthelios 50 Tinted Mineral Ultra Light Sunscreen Fluid, and Anthelios 50 AntiAging
PrimerwithSunscreen.
A new product, Capital Soleil SPF 30 Luxurious Protective Oil, is added to Vichys
Laboratoriesexistinglineofproductsin2012.
LOral retains its position as the thirdlargest nail polish marketer, with sales of $104
millionin2012,up160%from$40millionin2011.
LOralcompetesinnailpolisheswithitsLOralParis,Maybelline,Essie,Lancme,and
YSLBeautebrands.
SalesoftheEssiebrandincreasefrom$31millionin2011to$68millionin2012and
contributethemostdollarsforthecompany.
Essie continues to expand its shade selection to sustain its popularity among
consumersseekingthelatestfashionhues.
Since the acquisition of Essie by LOral in 2011, the brand continues to expand its
distribution.Thebrandissoldindrugstores,massmerchandisersincludingTargetand
Walmart,departmentstores,andspecialtystores,suchasUltaandSephora.
LOral Paris sales grow the most on a percentage basis from $2 million in 2011 to
$21millionin2012.ItssuccesscomesfromthelaunchoftheColourRichenailpolish
line.
Maybellinemorethandoublesitsnailpolishbusinessin2012reaching$10millionin
sales,upfrom$4millionin2011.MaybellinessuccesscomesfromthelaunchofColor
Shownailpolish.
Lancme doubles its nail polish business in 2012 with sales of $4 million, up from
$2millionin2011anddoesnotadvertise.Thebrandssuccesscomesfromthelaunch
ofLeVernisandVernisinLovenailpolishes.
4A242
LOral
5243
RECENTDEVELOPMENTS
M&Aactivity
InJuly2012,LOralcompletesthesaleofitshomecarebusinessfromtheCadumGroupto
EauEcarlateSASforanundisclosedsum.
InOctober2012,LOralUSAsignsanagreementtoacquireEmilianiEnterprisesextending
itscoverageofAmericanhairsalons.
InOctober2012,LOralacquirestheVoguemakeupbrandinColombia.
In November 2012, LOral acquires Urban Decay, specialty makeup brand in the United
Statesforapproximately$350million.
In December 2012, Galderma, a pharmaceutical company formed as a joint venture

between Nestl and LOral, acquires Spirig, a leading company in the production and
developmentofdermatologicalproducts.
Managementchanges
In March 2013, Lindsay Owen Jones resigns from the Board of Directors, and Virginie
MorgonisappointedasanewDirectorbytheBoard.
Otherdevelopments
InMarch2012,LOralinauguratesitsGlobalHairCareResearchCenterinParisSaintOuen,
France.
This100millionfacility,builton25,000squaremeters,employees500people.
This center will be the head of a global network of six research & innovation (R&I)
regionalcenters,andtheheadquartersforthecompanysinternationaldepartmentsof
haircolor,haircare,andhairstyling.
InNovember2012,LOralannouncesmajorexpansioninitsKentuckyManufacturingPlant.
Theproposedplantexpansionincludesrenovationstotheexistingplant,newconstruction,
andthepurchaseofnewequipment.
InJanuary2012,LOralannouncesthelaunchofawebsiteintheUnitedStates,designed
toinspireandempowergirlstopursuecareersinscienceandtechnology.
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LOral
In September 2012, FDA warns LOral over claims for antiaging products by issuing a
warninglettertothecompany.
Intheletter,FDAclaimsthat11ofthecompanysskincareproductscanbeclassified
asdrugsastheyservethepurposeofchangingthestructureorfunctionofthehuman
body. These products include: Genifique Youth Activating Concentrate, Genifique Eye
Youth Activating Eye Concentrate, Genifique Cream Serum Youth Activating Cream
Serum, Genifique Repair Youth Activating Night Cream, Absolue Precious Cells
Advanced Regenerating and Reconstructing Cream SPF 15 Sunscreen, Absolue Eye
Precious Cells Advanced Regenerating and Reconstructing Eye Cream, Absolue Night
Precious Cells Advanced Regenerating and Reconstructing Night Cream, and Renergie
MicroliftEyeR.A.R.EIntenseRepositioningEyeLifter
Newproducts
Table5132:SelectNewProductsIntroducedbyLOralintheUnitedStatesin2012
Brand
Category
Description
BodyShop
Facialtreatments
NutriganicsDropsofYouthisayouthenhancingconcentratewith
plantstemcelltechnologytoenhancesurfaceskinrenewalfor
smoother,healthierskin
Dark&Lovely
Ethnichaircare
products
AuNaturaleantibreakagemaintenanceandstylinglineisinfused
withmangooilandbamboomilk,nourishmentforallcurltypes
Dark&Natural
Ethnichaircare
products
5MinutePermanentHaircolorlocksincolorandleaveshairsoft
Dark&Lovely
Ethnichaircare
products
HealthyGloss5MoistureHairCrmeinfuseshairwithsupreme
shineandreplenisheshairandscalpwithmoisture
Dark&Lovely
Ethnichaircare
products
FadeResistantRichConditioningColor,containsmoistureseal
technology,enhancestheconditioningpower
Essie
Nailpolishes
Stylenomicsnailpolish
Essie
Nailpolishes
LuxEffectsfivemultidimensionaltopcoats
Essie
Nailpolishes
Mirrormetallicshades
EverCreme
Shampoos
TheIntenseNourishingshampoocontainsnaturalbotanicalsandis
freefromsulfatesandparabens
EverCreme
Conditioners
Nourishingconditionerinfusedwithomega3and6thathelps
restoremoisture;containsnaturalbotanicalsandisfreefrom
parabens
Haircoloring
products
FriaWildOmbreisanathomehaircoloringproductthatclaimsto
givemultishadeeffectswithonepackage.Itisavailableinshades,
suchasmediumtodarkbrown;darkblondetolightbrown;and
lighttomediumblonde.Thepatentedbrushapplicatorallowsquick
andpreciseapplication
Fria
(Continued)
4A244
LOral
Brand
Category
Description
Garnier
Facialtreatments
GarnierSkinRenewalDarkSpotOvernightPeelisaglycolicpeelthat
canbeusedasanovernighttreatmenttofadedarkspots,evenskin
tones,brightenskin,andrefinetheskinstexture
Garnier
Facialtreatments
SkinRenewMiracleSkinPerfectorBBCreamevenstone,brightens
complexion,renewsradiance,delivers24hourhydration,provides
SPF15UVAandUVBprotection
GarnierFructis
Hairstylingproducts TheSpikeExplosionPowerGelcontainstaurineandcitruscomplex
GarnierFructis
Hairstylingproducts TheDisorderhairgelcontainsnaturalingredientsincludingcitrus
GarnierFructis
Hairstylingproducts
TheCleanSleekPowerGelandPuttyprovidesultraslick,wetshine
lookforanyhairstylewith24hourhold
GarnierFructis
Hairstylingproducts
TheSufferHairPowerPuttycontainsnaturalingredientsincluding
citrusandlemonextracts
GarnierFructis
Hairstylingproducts
TheMessMakerPowerGelandPowerPuttycontainsalight
formula
GarnierFructis
Shampoos
GarnierFructisPureCleanshampoobooststhehealthofthehair
andscalp,andcontainsabiodegradableformulafromFructis
GarnierFructis
Conditioners
TripleNutritionconditionerfortifiesandinfusesnutrientsforsilky
hair,fulloflife
GarnierFructis
Conditioners
PureCleanFortifyingconditionerbooststhehealthofhairand
scalp,andisthefirstbiodegradableformulafromFructis
GarnierNutrisse
Haircoloring
products
Theproductisammoniafreeandcontainsbambooextractwhich
reinforcesthehair'sprotectivecuticlelayerwhilecoloring
GarnierOlia
Haircoloring
products
Theproductisavailablein23shadesanduses60%oilblendwith
naturalfloweroilsinthecolorant.Thisoilbasedformulaincites
colorantstopenetratedeepintohairforlongerlastingcolor
Kiehls
Facialtreatments
ClearlyCorrectiveDarkSportSolutioncontainsvitaminC,white
birch,andpeonytodiminishnumberandintensityofdarkspots
LaRochePosay
Facialtreatments
Redermicantiagingformulaclaimstocombatwrinkles,inspiredby
dermatologistsapproachtoplump,fill,andhydrate
Lancme
Eyemakeup
HypnoseStarMascaradualactionbrushhasaflatsidefor
optimizingproductdepositatthelashlinewhiletheroundedside
separates,defines,andlengthens
Facialtreatments
AbsoluLExtraitisaregeneratingelixirthatclaimstorevealfirmer,
moreelastic,radiantskin.Eachjarhasupto2millionrosenative
cells
Lancme
(Continued)
5245
5246
LOral
Brand
Category
Description
Lancme
Facialtreatments
GenifiqueYeuxLightPearlEyeIlluminatingYouthActivating
Concentratecontainsauniquerotatingandmassagingapplicatorto
reacheventhemostinaccessibleeyeareaswith360degreeeye
contourapplication
Lancme
Facialtreatments
RnergieMultiLiftActionclaimstoshieldskinwithbroadspectrum
SPF15andrestoresskinsyouthfulenergy.Addressingkeyaging
concerns,itlifts,firmsandsmoothensinfourweeks
Lancme
Facemakeup
TeintIdoleUltra24HRfoundation
Lancme
Facemakeup
TranslucenceMattifyingSilkyPressedPowder
Lancme
Lipsticks
RougeinLove
Lancme
Fragrancesfor
women
LaVieEstBellereportedlytookthreeyearstoformulatewithIrisas
thekeyingredientsurroundedbyorangeblossomsandjasmine.The
flaconisaredesignedversionofaclassicLancmebottlefrom1949
LOral
Eyemakeup
Infallible24HREyeShadow
LOral
Eyemakeup
ColourRicheeyeshadow
LOral
Eyemakeup
VoluminousPowerVolume24HRMascara
LOral
Eyemakeup
VoluminousFalseFiberLashesmascara
LOral
Eyemakeup
LOral
Eyemakeup
MagicDeCreaseEyelidPrimer
LOral
Eyemakeup
LOralParis
Facialtreatments
YouthCodeBBCreamIlluminatorclaimstoeven,illuminate,
perfect,correctandmoisturizeinonestep.YouthCodeFoamingGel
cleanserisanewcleanseraddedtotheYouthCodeline
LOralParis
Facialtreatments
RevitaLiftTriplePowerisafacialtreatmentcollectionwhich
containsthehighestlevelsofLOralsproprietaryProXylane,
whichisanaturallyderived,biodegradablemolecule,extracted
fromthebeechwoodplant.Thisingredientissaidtoenhance
collagenproduction.Designedtoaddressthreedimensionsofaging
wrinkles,lossoffacialvolume,andfirmnessthelinecomprises
aDay/NightCream,Serum,andEyeTreatment
LOralParis
Facemakeup
VisibleLiftSerumAbsoluteConcealer
LOralParis
Facemakeup
VisibleLiftRepairAbsoluteAgeReversingFoundationSPF16
LOralParis
Facemakeup
TrueMatchLumiHealthyLuminousMakeup
LOralParis
Facemakeup
TrueMatchSuperBlendableMakeup
LOralParis
Facemakeup
TrueMatchCrayonConcealer
LOralParis
Shampoos
TotalRepair5Restoringshampoohelpsrepairfivevisiblesignsof
damagedhairsplitends,weakness,roughness,dullness,and
dehydration
(Continued)
4A246
LOral
Brand
Category
Description
LOralParis
Shampoos
TripleResistReinforcingshampooinstantlyhelpsnourishhairfrom
roottocoretotip,therebystrengtheninghair
LOralParis
Shampoos
SmoothIntensePolishingshampoosoftenshairandcombats
symptomsofroughtextures,leavinghairsmooth
LOralParis
Conditioners
AdvancedHairCareTotalRepair5Restoringconditionerhelps
repairfivevisiblesignsofdamagedhair:splitends,weakness,
roughness,dullness,anddehydration
LOralParis
Conditioners
TripleResistReinforcingconditionerinstantlyhelpsnourishhair
fromroottocoretotip,therebystrengtheninghair
LOralParis
Conditioners
SmoothIntensepolishingconditionersoftenshairinstantlyand
combatssymptomsofroughtextures,leavinghairsmooth
LOralParis
Lipsticks
ColorRichBalm
LOralParis
Lipsticks
ColourCaressebyColourRichelipstick
LOralParis
Lipsticks
ColourCaresseWetShineStainbyColourRichelipgloss
LOralParis
Lipsticks
InfallibleLeGloss8hour
LOralParis
Nailpolishes
ColourRichenailpolish
LOralParis
EverStyle
HairStyling
Products
CurlActivatingMoussecontainsaweightlessformula,natural
ingredients,andisfreefromalcoholandparabens
LOralParis
EverStyle
HairStyling
Products
CurlDefiningGelcontainsnaturalingredientsandisfreefrom
alcoholandparabens
LOralParis
EverStyle
HairStyling
Products
VolumeRootLiftingsprayis100%freefromdryingalcoholsand
containsnaturalingredients
Matrix
Shampoos
BlondeCareshampoocontainsablendofchamomileandpanthenol
Matrix
Conditioners
BlondeCareconditionercontainsanexoticblendofchamomileand
panthenolthatcleansesanddetangleshairforanenhancedbrilliant
shine,withoutaddingweighttothehair
Maybelline
Eyemakeup
Maybelline
Eyemakeup
DefineABroweyebrowpencil
Maybelline
Eyemakeup
EyeStudioMasterShapeBrowPencil
Maybelline
Facialtreatments
DreamFreshBBCreamprovideseightskinbenefitsforinstantskin
perfection
Maybelline
Facemakeup
DreamBouncyBlush
Maybelline
Facemakeup
NudeAirfoamMakeup
Maybelline
Lipsticks
ColorsensationalVividslipstick
Maybelline
Lipsticks
SuperStay10HRStainGloss
Maybelline
Nailpolishes
ColorShownailpolish
(Continued)
5247
5248
LOral
Brand
Category
Preference
Haircoloring
products
RalphLauren
Fragrancesfor
women
UrbanDecay
UrbanDecay
Eyemakeup
Facemakeup
Viktor&Rolf
Fragrancesformen
YSLBeaute
YSLBeaute
YSLBeaute
Facemakeup
Facemakeup
Lipsticks
Description
Thepermanenthaircolorisoptimizedwithfadedefying
conditionersthatkeephairsilkyandhealthyfromroottotip.The
productconcealsgrayhairandisavailablein37shadesranging
fromdarkblondetodarkbrown
BigPonyforHeristhe4 fragrancefemalecounterpartofthemens
collectionwitheachscentnumberedfrom1to4andhousedin
clearbottleswhichshowoffthebrightlycoloredjuice
SmokedEyeshadowPalette
NakedSkinWeightlessUltraDefinitionLiquidMakeup
Spicebomblookslikeahandgrenadeandcontainsnotesofchili,
saffron,leather,tobacco,andvetiver,alongwithbergamot,
grapefruit,elemi,andpepper
LeTeintToucheclatfoundation
ToucheclatRadiantTouchconcealer
RougePurCoutureVenisaLevers
MARKETINGACTIVITY
With TME support of $1,448 million, LOral is the secondleading advertiser in the
cosmeticsandtoiletriesindustryin2012.
At$778.2million,magazineisthemostpreferredmarketingmediumadoptedbythe
company.Closebehindaretelevisionadvertisementswithtraceablemediasupportof
LOral is the leading advertiser in the face makeup category with TME of $195.2
millionin2012,up9.4%from$178.3millionin2011.
LOralhasthehighestTMEintheeyemakeupcategory,with$204.2millionin2012,
flatfrom2011.
LOralParisreceivesthehighestTMEsupportofapproximately$350millionamongall
LOralsbrands.
LOral continues to market its products through various channels including discount
couponsandcelebritycampaigns.
Growth of the marketer is primarily supported by the aggressive marketing and
promotionalactivitiesundertakenbythemarketer.
LOralusessupermodelsanddesignersforthepromotionofitsmakeupandfragrance
products.
ThemarketersspokesmodelsincludecelebritiessuchasJenniferLopez,EvaLongoria,
GerardButler,AndieMacDowell,andLaetitiaCasta.
Themarketeradoptsvarioustools,suchastheInternetanddiscounts,topromoteits
productsacrosscategories.
Themarketerutilizesthesocialmediasites,suchasTwitter,Pinterest,andFacebook,
LOralprimarilypromotesitsnewproductlaunchesandotherproductoffersthrough
thischannel.
4A248
LOral
LOraladoptsdiscountcouponsasanimportantmeansofpromotion.
Couponing has gathered significance among brands as a promotional tool in the past
fewyearsduetothesubstantialsavingsitofferstoitsusers.
The company offers discount coupons of denominations ranging from $1.00 to $5.00
offonitsproducts.
It also offers discount coupons, usually in freestanding inserts (FSIs) in weekly
newspapers.
Themarketeralsopushescouponstosmartphonesthroughitsretailpartnerships.
The mobile coupons are offered in order to influence consumers purchase decisions
whiletheyareshoppingatsupermarketsnationwide.
Consumers can obtain coupons either on the companys website or through the
brands newsletter. The companys coupons are also available on various thirdparty
websites.
The marketer primarily offers discount coupons for its newly launched products in
ordertoattractconsumers.
The marketer allocates aggressive media spend to its core brands Maybelline, Garnier,
andLOralParisin2012.
LOral allocates the maximum of its TME to support its LOral Paris brand in 2012;
withapproximately$529million.
The marketer promotes LOral Paris primarily through print and television
advertisements.
LOralParisisadvertisedinpopularfashionmagazinesincludingGlamour,InStyle,and
Elle.
LOraloffersdiscountcouponsonitsLOralParisbrandtopromoteitssales.
TheMaybellinebrandisallocatedwithaTMEofapproximately$341.6millionin2012.
TheGarnierbrandreceives$265.8millionasTMEin2012.
The company promotes its Maybelline brand primarily through popular fashion
magazines,suchasAllure,Vogue,andGlamour.
MaybellinesFacebookpageoffersbeautytipstoitssubscribersinordertokeepthem
updatedwiththelatesttrendsandlaunchesunderthebrand.
ConsumerscansubscribetoMaybellinesnewsletteronitswebsitewhereitprovides
discountcouponsandinformationonitslatestlaunches.
During 2012, Maybelline continues to be the official sponsor for the MercedesBenz
FashionWeek,whichtakesplaceinNewYork,fortheseventhconsecutiveyear.
Maybelline, as the official cosmetics sponsor for the MercedesBenz Fashion Week,
releases an advertising campaign in spring 2012 featuring Jessica White, Shu Pei Qin,
LisallaMontenegro,ChristyTurlington,andEmilyDiDonato.
In2012,MaybellineorganizesDaretoWhisperContesttopromoteitsColorWhisper
line of products in which the first prize winner get $5,000 in cash and the next 300
winnersgetasetofall20ColorWhisperShades.
Maybellineswebsiteoffersmakeuplessonsforamateursandusersdesiringanewlook
bycategorizingthevideosaccordingtomakeupartistandspecificlookforeyes,face,
lips,andnailsgiventheoccasionandthemood.
In2012,MaybellineandGarnierorganizeHolidayGiftSweepstakesinwhichthefirst20
winnersgetachancetoreceiveprizesworth$150.00.
In 2012, Maybelline celebrates one million fans for its Facebook page, Sensational
Maybelline.
5249
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LOral
The marketer promotes its leading luxury brand, Lancme, on a large scale in 2012 by
allocating$112.3millionofthecompanystotalTMEin2012.
The company allocates $25.2 million to support its new launch Genifique Yeux Light
Pearl,afacialtreatmentproductin2012.
Lancme offers various incentives to encourage purchase, with giftwithpurchase
(GWP)andpurchasewithpurchase(PWP)asthemainpromotionaltool.
Anypurchaseof$60.00ormoremadedirectlyfromtheLancmewebsiteiseligiblefor
afreegiftcomposedofamakeupcasealongwithseveralsamplesizeproducts.
Freeshippingisavailableonordersof$49.00ormore.
Email signup is available on Lancmes website, to receive emails about new
productsandtrends.
Consumers can create an account directly through the Lancme website that will
entitletheconsumertopreviewandshopfornewproductsearlierthanotherpeople
can, receive deluxe sample offers which are of a larger size than the minisamples
typicallyprovided,andalsosavetoaWishlist.
The brand offers various instore events in conjunction their major retail partners to
providepersonalizedconsultationsandintroducenewproducts.
Lancme partners with Julia Roberts as the spokesperson for its La Vie Est Belle
fragrancein2012.
In2012,thebrandpremiersatelevisionadvertisementwhichfeatures1930scartoon
iconBettyBoop.
In addition, Lancme uses the platform www.makeup.com, a professional website
owned by LOral since 2009. The website features Lancmes presence in different
beautyblogs,whichareoperatedbybeautyexpertsandprofessionalbloggers.
Lancmeconsidersinstoremarketingtobeanextremelyimportantmarketingtoolfor
its brand, as sales associates can provide the necessary guidance for a consumer to
make the correct purchasing decision regarding products. Lancme, like other luxury
brands, is moving to an opensell environment in many department stores, where
customers are able to browse the products alone and are able to ask for sales
assistance, if necessary. These opensell installations invite browsing and enable the
consumerstoplaywiththemakeupthemselvesoraskforassistance,ifneeded.
Lancme offers a users club called My Lancme, which allows consumers to receive
exclusive updates and previews of new products, along with complimentary deluxe
sampleswitheveryorderandGWPoffers.
Lancmeholdsvariousinstoreeventstointeractwithconsumers,providingthemwith
amorepersonalizedconsultation.
Samplingisanimportantmeansofdrawingconsumerstopurchasenewluxuryfragrances
andfacialtreatments.
Scented strips in magazines and sample vials are common methods of sampling
employedbyLOral.
The company also offers smelling strips and blotters to consumers at the pointof
purchase,asameansofencouragingtrial.
4A250
LOral
Celebrities associated with beauty and glamour, such as actors and models, are featured
extensively in the promotional campaigns of LOrals skin care, fragrance, hair care, and
makeupcategories.
Thebrandambassadorsfeaturedinthepromotionalcampaignsofantiagingproducts
arechosenbasedontheagegroupofthetargetconsumers.
LOral exploits the growing reach and influence of the Internet as an effective tool for
productpromotion.
Presence on social networking websites such as Facebook, Twitter, Tumblr, and
Pinterest becomes an economical means to stay in touch with existing and potential
customers.
TheleadingbrandsfromLOralincludingGarnier,Lancme,andLOralParishavea
significantpresenceonFacebook.
LOraladoptsinstorepromotionsasamajormeansofpromotionalactivity.
New product launches for the fragrance brands and luxury skin care brands are
accompanied by promotional displays at respective counters of the brands in
departmentstores.
Beautyadvisorsplayanimportantroleinsellingluxuryfragrances.
The company employs knowledgeable beauty advisors, who encourage sampling and
explaintheintricaciesofthefragrancenotestoconsumers.
Giftsintheformofancillaryproductsorsamplepacksareofferedtoattractconsumers
towardsnewproducts.
LOralcontinuestobetheleadingmarketerintermsofadvertisingexpendituresaswellas
categorysalesinthehaircoloringproductscategory,withaTMEof$164.1millionin2012,
althoughdown11.8%from$186.1millionin2011.
The company spends approximately 64.4% or $105.8million on television
advertisementsin2012.
ATMEof$32.7millionisallocatedtopromoteL'OralExcellenceCrme.
GarnierNutrissesadvertisementexpenditurein2012totals$53.8million.
In2012,LOralisthesecondlargestadvertiserinthehairstylingproductscategory,witha
TMEofalmost$38.9million,down35.7%from$60.5millionin2011.
TheTMEisspreadmainlybetweentelevisionandmagazinesadvertisements.
Television and magazine advertising collectively account for more than 92% or
$35.8millionofTMEin2012.
LOral Paris EverStyle variant receives the singlelargest TME support at almost
$11.4millionin2012.
GarnierFructisStyleSleekFinish,astylingsprayvariant,garnersalmost$10.2million
inTMEin2012,spreadacrossmagazinesandtheInternet.
LOralsmediaspendingonpromotingitsshampoosbrandsis$51.4millionin2012,down
GarnierFructis,LOralsleadingbrand,hasaTMEof$51.1million.
The marketer allocates approximately 71.5% or $36.7 million on television
advertisementsfollowedbymagazineadvertisementswithaTMEof$14.0million.
LOralhasthehighestmediaspendingintheconditionerscategoryin2012.LOrals
advertisingspendingonpromotingitsconditionersis$40.7million.
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LOral
OUTLOOK
LOralisexpectedtopostmoderatetohealthygrowthof2.8%intheUnitedStatesover
theforecastperiod,2012to2017.
Product innovations with better technologies and new formulations are expected to
drivethemarketersgrowthovertheforecastperiod.
Makeup, skin care, and fragrances product classes are expected to be the highest
revenuegeneratorsforLOralovertheforecastperiod.
ThemarketerwillcontinuetosupportitsnewproductlauncheswithsignificantTMEin
ordertostrengthenitsposition.
LOral will continue to enhance its research and development activities in order to
continuallyinnovateandensureitssalesgrowthovertheforecastperiod.
LOral is likely to excel continually in product promotion, product innovation, and
distribution, which are crucial success factors for the marketers of cosmetics and
personalcareproducts.
The marketer continues to post significant growth of 7.4% in the luxury segment in
2012,drivenbythesalesfromdepartmentstoresandthehealthyperformanceofthe
facialtreatmentscategory.Thisgrowthcanbeattributedmainlyduetotherecoveryin
theeconomyandthehighendconsumerswillingtospendmoreonluxuryitems.
Themasssegmentalsoshowsagoodgrowthof5.5%in2012,primarilydrivenbythe
good performance of the makeup product categories including face makeup, eye
makeup,andnailpolishes.
Thecorebrandsofthemarketer,LOralParis,Maybelline,Lancme,andGarnierare
expectedtodrivethesalesforLOraloverthenextfiveyears.
LOralwillcontinueto focuson productinnovationsovertheforecastperiodinorderto

maintainitspositioninthecosmeticsandtoiletriesmarket.
The company will continue to launch innovative products with better technologies
acrossitsmajorcategoriesincludingfacialtreatments,facemakeup,suncareproducts,
shampoos,andconditionersovertheforecastperiod.
Inthefacialtreatmentscategory,themarketerisexpectedtointroduceproductsthat
willtargetbothpreventionandcorrectionofcommonissuesrelativetofacialconcerns.
Themarketerisalsolikelytoofferbenefitsthatclaimtomimicthoseofinjectableswith
musclerelaxing properties like Botox has, and plumping skin as do fillers such as
RestylaneandJuvedermtoincreaseitssalesinthefacialtreatmentscategory.
LOral continues to utilize premium ingredients and packaging in an effort to
differentiate its brands. Facial treatments will increasingly include highperformance
ingredientsinanattempttoboostproductefficacyandprovidevisibleresults.
Fragranceswillincorporatehighendpackagingasameanstocreateperceivedvaluein
theeyesofconsumers.Thiswilladdslightlytotheproductioncostsforthemarketer
4A252
LOral
The marketer will continue to introduce products that are naturally positioned, as the
naturalsegmentisexpectedtoperformwellovertheforecastperiod.
The natural and organic products segment will continue to perform well during the
nextfiveyearsasconsumersbecomemoreconsciousofwhattheyuse.
LOral is expected to infuse more natural ingredients to its new launches as well as
existingproductsinordertosupportitssalesgrowth.
The marketer will continue to focus on eliminating harsh chemicals and ingredients
suchassulfatesandparabensinitsproducts.
The marketer will focus on natural ingredients ranging from oils to plants, to
ingredientsfromthesea,andstemcellsfromfruitsandplants.
Themarketerwillcontinuetofacestiffcompetitionfromtheotherleadingcosmeticsand
toiletriesmarketersovertheforecastperiod.
LOral is placed second in the overall cosmetics and toiletries market in the United
StatesafterProcter&Gamble,anditwillcontinuetobeactiveintheindustryinorder
tomaintainitspositionovertheforecastperiod.
The key competitors for LOral in the industry include Procter& Gamble, Unilever,
Johnson&Johnson,EsteLauder,andLimitedBrands.
TheoperatingmarginsforLOralscosmeticsandtoiletriesdivisionintheUnitedStateswill
continuetogrowoverthenextfiveyears.
The marketer offers its products across various channels including mass, luxury,
professional,andspecialty.
The marketer generates most of its revenues from its two core channels, mass and
luxury,andislikelytocontinuetogetthehighestrevenuesfromthesesegmentsover
theforecastperiod.
LOralgeneratesmostofitssalesfromhighermarginhaircareandmakeupproducts,
whichwillhelpthecompany,maintainitsoperatingmargin.
Furthermore,LOralwillcontinuetoextenditsreachtovariedconsumersegmentsby
offering products across different price points in brands such as LOral Paris and
Lancme.Thiswillhelpthemarketertoaddmoreconsumersinthelongrun,andto
increaseitspresenceacrossmoredistributionchannelsandpricepoints.
LOralislikelytoincreaseitsmediaspendingacrosscategoriestosupportitssalesgrowth
The marketer will continue to aggressively support its mass and luxury products that
willcontributetothecompanysgrowth.
Global advertising campaigns featuring actors and models will contribute to the high
visibilityandbrandrecognitionenjoyedbyLOralsmakeupandfragrancebrands.
LOralspendsmorethan31%ofitsnetsales,ormorethan$1.4billion,onTME.
The marketer will continue to support its new product introductions with aggressive
mediaexpenditurestosupportitssales.However,itisexpectedthatthemarketerwill
eventuallytrimitsadvertisingexpensesandkeepitclosertothe19%to20%rangeasa
percentageofnetsalesduringtheforecastperiod.
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LOral
Televisionandmediaadvertisingwillremainthemostpreferredchannelforpromoting
itsproductsovertheforecastperiod.
Themarketerwillcontinuetoengageconsumersinvariouscontestsandcampaignsin
ordertoeducateconsumersregardingtheirproducts.
The company will continue to offer discount coupons and free samples for its new
launchesinordertoattractconsumers.
The company will continue to partner with models, actors, and designers in order to
promoteitssalesinthefuture.
ThekeybrandsthatareexpectedtoreceivethehighestTMEsupportbyLOralover
theforecastperiodincludeLOralParis,Maybelline,Lancme,andGarnierFructis.
LOralisexpectedtoadoptinnovativemethodsofmarketingandpromotionsoverthe
forecastperiod.
In2012,themarketerlaunchesafemaletargetedXboxapplicationtokeepthefemale
consumersengagedwithitsbrands.Thesetypesofinterdisciplinaryinnovationsareto
beexpectedinthefuture.
The new application Next Level offers product articles, how to videos, and latest
beautystylesandtrendsbasedonLOralsbrandsintheUnitedStates.
The marketer will focus on enhancing its research and development activities in order to
introduceinnovativeproductstocapturemoremarketshareovertheforecastperiod.
The marketer continues to partner with various scientists in order to introduce
productswithinnovativeingredients.
The marketer is increasingly pushing back boundaries and taking up challenges to
introduceinnovativeproducts.
LOral continues to invest a lot on its research and development activities and has
maintainedacompetitiveedgethisway.Hence,themarketerwillcontinuetoinveston
itsresearchanddevelopmentactivitiesoverthenextfiveyears.
The key innovations by LOral in 2012 include Lancmes Gnifique Yeux Light Pearl
productthatisclaimedtocontainauniquerotatingandmassagingapplicatortoreach
even the most inaccessible eye areas. However, it will need to take care with its
marketingclaimstoavoidincitingtheFDAorotherregulatoryenquiries.
The marketer will continue to launch similar innovative products over the forecast
periodinordertosupportitsoverallsales.
NewlineextensionsareexpectedtohelpLOralregistersalesgrowthandimproveits
marketshareduringtheforecastperiod.
Themarketerplanstoredesignitspersonalcarebrandsovertheforecastperiodtosupport
itssales.
In 2012, the company redesigns its Pureology hair care products with multitasking
bottlesdesignedforsustainablepackaging.
Themarketerwillcontinuetoredesignitsotherbrandswithsustainablepackagingover
thenextfiveyears.
The company plans to redesign its LOral Paris brand with sustainable packaging by
usingenvironmentallyfriendlymaterialsin2013.
4A254
LOral
Themarketerwillcontinuetofocusonthedigitalmediainordertogetclosertoconsumers
LOralwilllikelycontinuetoincreaseitsinvestmentsondigitalmediabyincreasingits
online presence through social media sites such as Facebook, Youtube, Tumblr, and
Pinterest.
Themarketerwillfocusonthedigitalmediaplatformasitisagreatpromotionaltool
thatwillfurtherstrengthenthepositionofthecompanysbrands.
LOralhasalmost20millionFacebookfansatpresentandthemarketerplanstoutilize
thistopromoteitsproducts.
ThesocialmediachannelwillallowLOraltointeractwithconsumerssoastoidentify
theproductstheyseek.
The marketer displays its new product launches, product offers, and various product
videosonitsFacebookpagetokeeptheconsumersinterestengaged.
LOralisexpectedtomakestrategicacquisitionstofurtherexpandthecompanysproduct
portfolioovertheforecastperiod.
In2012,themarketeracquiresUrbanDecaytofurtherstrengthenitscolorcosmetics
divisionintheUnitedStates.
LOreals CEO JeanPaul Agon announces early in 2013 that he is willing to make an
importantacquisitionin2013tomaintaingrowth.
LOralwillcontinuetoexpanditsdistributionofproductsthroughmassanddrugstoresin
theUnitedStatestosupportitssales.
In 2012, the marketer expands its skin care brands, La RochePosays and Vichys
distributiontomoreWalgreensstoresinordertopromoteitssales.
ThemarketeralsoplanstoopenanewdistributioncenterinDallasin2013.
Duringtheforecastperiod,thecompanyssalesareprojectedtoincreaseataCAGRof2.8%,
from$4,551millionin2012to$5,225millionby2017.
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LOral
andToiletriesforLOralbyCategory,2012to2017
Category
CAGR,%
Nailpolishes
6.0
Facemakeup
4.5
Eyemakeup
4.2
Suncareproducts
4.0
Facialtreatments
3.5
COMPANYAVERAGE
2.8
1.7
Shampoos
1.5
Conditioners
1.4
1.2
1.2
1.0
1.0
Fragrancesformen
1.0
Fragrancesforwomen
0.8
0.8
Handandbodylotions
(1.0)
(10.0)
4A256
LVMH
Table5134:LVMHsSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
FRAGRANCESFORWOMEN
2012
J'adore
22
26
Shalimar
12
12
MissDiorCherie
VeryIrresistible
FanDiFendi
Amarige
VeryIrresistibleIntense
Eat,Pray,Love
Fresh
Organza
AbsolutelyIrresistible
DiorAddict
DiorAddict2
Dune
HypnoticPoison
Poison
PurePoison
Ysatis
Allother
13
14
Total
91
96
Benefit
30
40
ChristianDior
26
29
Total
56
69
EYEMAKEUP
(Continued)
5258
LVMH
Table5134:LVMHsSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
FACIALTREATMENTS
2012
ChristianDior
27
32
Guerlain
16
17
Benefit
14
14
61
67
Benefit
30
32
ChristianDior
21
23
Total
51
55
14
15
21
23
Fahrenheit
Pi
Play
Allother
18
17
NAILPOLISHES
ChristianDior
Givenchy
Total
FACEMAKEUP
ChristianDior
Benefit
Total
FRAGRANCESFORMEN
Total
HANDANDBODYLOTIONS
Benefit
TOTAL
307
337
NOTE:"Allother"includesthesalesofsmallerbrandsthatthecompany
owns.
4A258
LVMH
COMPANYOVERVIEW
Founded in 1987 and headquartered in Paris, France, LVMH is a luxury goods holding
company.
It is the parent of around 60 subcompanies that each manages a small number of
prestigiousbrands.
As of December 31, 2012, the company operates approximately 3,402 stores
worldwideandemploysmorethan97,559employeesglobally.
Thecompanyspecializesinfivedifferentsectors:winesandspirits,fashionandleather
goods,perfumesandcosmetics,watchesandjewelry,andselectiveretailing.
LVMHownsmanypopularluxurybrands,suchasMotetChandon(winesandspirits);Dom
Prignon (wines and spirits); Donna Karan (fashion and leather goods); Givenchy (fashion
andleathergoods);TagHeuer(watchesandjewelry);andZenith(watchesandjewelry).
ThetotalcorporatesalesofLVMHincreasefrom23,659million($30,406million)in2011,
to28,103million($36,117million)in2012,upby18.8%.
Net profits increase by 12.8%, from 3,465million ($4,453 million) in 2011, to
Table5135:LVMHsGlobalCorporateSales,2007to2012
Million
Year
Sales
Netprofits
Marginonsales,%
2007
16,481
2,331
14.1
2008
17,193
2,318
13.5
2009
17,053
1,973
11.6
2010
20,320
3,319
16.3
2011
23,659
3,465
14.6
2012
28,103
NOTE:$1.00=0.7781.
3,909
13.9
TheFashionandleathergoodssegmentcontinuestobethelargestbusinessgroupwithin
thecompanyin2012,commanding35.3%ofthetotalcorporatesales.
TheWatchesandjewelrysegmentclearlyoutpacesotherbusinessgroupsintermsof
salesgrowth,asitwitnessesa45.5%increaseduringfiscal2012.
Perfumes and cosmetics witnesses a 13.1% increase in global sales, up from
3,195million($4,106million)in2011to3,613million($4,643million)in2012.
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LVMH
Table5136:LVMHsGlobalCorporateSalesbyBusinessGroup,2011and2012
Million
%Oftotal
Businessgroup
2011
2012
2011
2012
Change,%
Fashionandleathergoods
8,712
9,926
36.8
35.3
13.9
Selectiveretailing
6,436
7,879
27.2
28.0
22.4
Winesandspirits
3,524
4,137
14.9
14.7
17.4
Perfumesandcosmetics
3,195
3,613
13.5
12.9
13.1
Watchesandjewelry
1,949
2,836
8.2
10.1
45.5
(157)
(288)
(0.7)
(1.0)
23,659
28,103
100.0
100.0
Allotheractivities
Total
18.8
NOTE:$1.00=0.7781.
LVMHsellsitsproductsworldwide.
The rest of Asia (except Japan) continues to be the largest market for the company,
followedbytheUnitedStatesandtherestofEurope(excludingFrance).
Table5137:LVMHsGlobalCorporateSalesby
Region,2012
Region
%Ofsales
RestofAsia
28.1
UnitedStates
22.7
RestofEurope
19.4
France
11.1
Japan
8.4
Allother
10.3
Total
100.0
LVMHsU.S.salesofcosmeticsandtoiletriesincreaseby9.8%,from$307millionin2011to
$337millionin2012.
4A260
LVMH
Table5138:LVMHsSalesofCosmeticsand
ToiletriesintheUnitedStates,2007to2012
Year
$Million
Change,%
2007
282
2008
279
(1.1)
2009
269
(3.6)
2010
279
3.7
2011
307
10.0
2012
337
9.8
ThewomensfragrancescategorycontinuestobethelargestproductcategoryforLVMH,
commanding28.4%ofthecompanyssales.
Salesincreasefrom$91millionin2011to$96millionin2012.
JadorecontinuestoLVMHsleaderinthecategory,with$26millioninsales,followed
byShalimarwith$12millioninsalesin2012.
Makeupproductsaccountfor 46.0%ofthecompanyssalesin2012intheU.S.cosmetics
andtoiletriesmarket.
Thecontributionincreasesfrom43.6%in2011.
The category commands a 6.2% market share in the U.S. luxury makeup product
segmentin2012,upfrom5.8%in2011.
BenefitandChristianDioraretheleadingmakeupbrandsforthecompany.
Eye makeup is the secondlargest category for the company, with sales of $69million in
2012,upby23.2%from$56millionin2011.
ThecompanybenefitsfromtheloyalcustomerbaseforitsBenefitbrand,supportedby
itsglamorouspackagingandinnovativeformulas.
Facial treatments constitutes the thirdlargest category for the company, with a share of
19.9%ofthecompanyssales.
Salesinthecategoryincreasefrom$61millionin2011to$67millionin2012,up9.8%.
Christian Dior, its largest brand in the category, experiences an increase in sales by
18.5%,from$27millionin2011to$32millionin2012.
Guerlainssalesalsoincreaseby6.3%,from$16millionin2011to$17millionin2012;
however,BenefitandGivenchyrecordflatsalesfrom2011at$14millionand$4million,
respectively,in2012.
Facemakeupsalesforthecompanyincreasefrom$51millionin2011to$55millionin2012.
ThecompanysellsBenefitandChristianDiorbrandsunderthiscategory.
Sales in the lipsticks and lip glosses category increase from $21million in 2011 to
$23millionin2012,upby9.5%.
Improvedsalesofnewnailpolishcolorssupportthecategorysgrowthin2012.
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LVMH
LVMHseesadeclineinthemensfragrancescategoryin2012.
Salesdecreasemarginallyfrom$18millionin2011to$17millionin2012.
Lackofnewproductactivityandlimitedtraceablemediaexpenditures(TMEs)leadto
thedeclineinsalesforthecategory.
RECENTDEVELOPMENTS
Managementchanges
In March 2012, LVMH announces the appointment of Sebastian Suhl as Chief Executive
OfficerofGivenchyCouture.
InDecember2012,LVMHannouncestheappointmentofMichaelBurkeasChairmanand
CEOofLouisVuitton.HejoinstheExecutiveCommitteeofLVMH.
ThereissignificantactivityontheM&AfrontforLVMHinfiscalyear2012.
InMay2012,LVMHacquirestheentiresharecapitalofLesTanneriesRoux(France),a
leathersupplyingcompany,foranundisclosedamount.
In June 2012, LVMH acquires Arnys (France), a fashion house that makes apparel for
men.Thetermsofthedealarenotdisclosed.
In October 2012, LVMHs Berluti brand acquires the business of Anthony Delos, a
bespokefootwearmanufacturer.Thefinancialtermsarenotdisclosed.
Otherdevelopments
In May 2012, LVMH teams up with the European Commission to promote best
environmentalbehaviorsintheframeworkoftheGreenWeek2012.
4A262
LVMH
Newproducts
Table5139:SelectNewProductsIntroducedbyLVMHintheUnitedStatesin2012
Brand
Category
Description
Benefit
Lipsticks
UltraPlushLipgloss
ChristianDior
Facemakeup
DiorskinNudefoundation
ChristianDior
Lipsticks
DiorAddictLipGlow
ChristianDior
Facialtreatments
OneEssentialMaskisaserumtomaskformulatoeliminatetoxins
andprovideintensiverepair
ChristianDior
Facialtreatments
HydraLifeBBCreamisoneuniversalshadethatcombinesthe
moisturizingandprotectivepowersofaskincareproductwith
immediatecomplexionenhancingandeventoningpropertiesofa
foundation
MakeUpForEver
Facemakeup
HDComplexionStarterKit
Sephora
Lipsticks
PantoneUniverseLipLusterLipstick
MARKETINGACTIVITY
LVMHhasaTMEof$89.8millionin2012.
Itincreasesitsmediabudgetby63.0%from$55.1millionin2011.
The company spends approximately $62 million of its total TME through local
magazines.
Thecompanyspendsalmost$65.1millionor72.4%ofitsTMEtosupportitsfragrancesfor
womenproductsin2012.
LVMHspendsthehighestTMEof$50.1milliontosupportitsChristianDiorfragrance
brand.
Themarketerprimarilyadvertisesitsproductsthroughprintadvertisementsinbeautyand
fashionmagazines,suchasVogueandAllure
Themarketerusestheincreasinglypopularsocialmedianetworks,Facebook,Twitter,and
YouTube,topromoteitsproducts.
The marketer primarily advertises its new product launches through its social media
channelstoengageconsumersinterest.
Thecompanyalsopromotesitsproductsbygivingfreesamplestoattractmoreconsumers.
Thesepromotionsincludescentedstripsinmagazinesandsmallsamplesdistributedin
stores.
Intheskincareproductsclass,thecompanyusesspeciallydesignedminiaturesample
packs,whichencourageproducttrial.
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5264
LVMH
OUTLOOK
LVMHisforecasttopostmoderategrowthof2.0%overtheforecastperiod,2012to2017.
The growth of the marketer will be primarily supported by new product launches
across categories over the next five years and the resilience of the luxury shoppers
budgets.
Increasingmarketingandpromotionalactivitieswillalsocontributetothemarketers
overallgrowth.
The makeup product class and the facial treatments category are expected to post the
highestgrowthovertheforecastperiod.
Thecompanyisexpectedtolaunchnewantiagingproductstosupportitssalesgrowth
inthefacialtreatmentscategoryinthefuture.
Growing demand for antiaging products will drive sales of the facial treatments
categoryovertheforecastperiod.
Thecompanywilllikelylaunchnewandinnovativeproductstosupportthegrowthof
themakeupcategory.
The fragrances product class is projected to be the highest revenue generator for the
companyoverthenextfiveyears.
Thecompanyplanstolaunchmorefragrancesandincreaseitsmediaspendtosupport
thesalesoffragrancesovertheforecastperiod.
Fragrances for women is expected to maintain its leadership in the company in the
future.
ThemarketerplanstofocusonitsDiorfragrancelinesovertheforecastperiod.
The company is expected to increase its media spending during the forecast period to
supportitssales.
The company is likely to spend more on promoting its fragrances product class and
facial treatments category over the forecast period. Furthermore, the company is
expectedtospendmoreonitsnewproductlaunchestosupportitssales.
Magazine advertisements are likely to be the preferred mode of advertising medium
forthemarketer.
The company will likely enter into new markets and new product categories through
mergersandacquisitions,andsigningpartnershipagreements.
Itwillmaintainitsdominanceasthelargestluxuryconglomerateintheworld.
LVMHalsopromotesitsproductsthroughsocialmediachannelsandisexpectedtoincrease
itspresenceinthisplatformtosupportitssalesandattractmoreconsumers.
ThecompanylaunchesitsTwitteraccountLVMHinHyeresinApril2012.
4A264
LVMH
Thecompanywillcontinuetoleverageconsumerinterestinsocialnetworkingsitesand
willstrengthenitspresencebycontinuingtopromoteitsbrandsonsocialsitessuchas
Facebook,Twitter,andYouTube.
5265
5266
LVMH
Themarketermightdiscontinueitshandandbodylotionsproductsovertheforecastperiod
due to the lack of new product extensions, a lack of TME support, and other significant
activitiestosupportthecategory.
Thecompanyscosmeticsandtoiletriessalesareprojectedtoreach$372millionby2017,
growingataCAGRof2.0%,from$337millionin2012.
andToiletriesforLVMHbyCategory,2012to2017
Category
CAGR,%
Eyemakeup
4.0
Facialtreatments
3.0
Facemakeup
2.8
Nailpolishes
2.6
COMPANYAVERAGE
2.0
1.5
Fragrancesforwomen
0.5
Fragrancesformen
0.3
Handandbodylotions
4A266
MARYKAY
Table5141:MaryKaysSalesofCosmeticsandToiletriesintheUnitedStates,2011and
2012
$Million
Category/brand
2011
FACIALTREATMENTS
MaryKay
451
449
166
178
132
141
FACEMAKEUP
MaryKay
EYEMAKEUP
MaryKay
2012
MaryKay
107
HANDANDBODYLOTIONS
110
MaryKay
93
FRAGRANCESFORWOMEN
95
ThinkingofYou
BelaBelara
Journey
Velocity
Affection
Belara
Allother
12
12
Total
34
32
FRAGRANCESFORMEN
VelocityforHim
Domain
MKHighIntensity
Tribute
22
22
Total
(Continued)
5268
MaryKay
Table5141:MaryKaysSalesofCosmeticsandToiletriesintheUnitedStates,2011and
2012
$Million
Category/brand
2011
2012
MaryKay
17
17
MaryKay
SUNCAREPRODUCTS
MaryKay
SHAVINGPRODUCTS
MaryKay
NAILPOLISHES
MaryKay
TOTAL
1,047
1,063
NOTE:Allothersalesincludethesalesofsmallerbrandsthatthecompanyowns.
COMPANYOVERVIEW
MaryKaywasfoundedonSeptember13,1963.
It is one of the largest directselling company of skin care and color cosmetics in the
UnitedStatesandinternationally.
ItisheadquarteredinthetownofAddison,asuburbofDallas,TX.
Mary Kay remains family owned. Mary Kay Ash, the founder, remained active in the
companyuntil1996.HersonRichardRogerswasnamedtheCEOofMaryKayin2001,
theyearofAshsdeath.
ThecompanymarketsallitsproductsprimarilyundertheMaryKaybrandname.
Thecompanysproductsaremanufacturedintwomanufacturingcenters:onenearthe
companysheadquartersinDallas,andtheotherinHangzhou,China.
Itemploysaworkforceofaround4,500peopleglobally.
Mary Kay sells its products through an independent contractor sales force called
IndependentBeautyConsultants.
Thereareabout2.4millionIndependentBeautyConsultantsinmorethan35countries.
TheBeautyConsultantspurchasetheproductsatwholesalepricesfromthecompany.
Theproductsarethensoldtoendusersatretailpricesbytheconsultants.
MaryKayhasmorethan600independentnationalsalesdirectors,whoholdthehighest
rankwithintheindependentsalesforce.
4A268
MaryKay
Consultantsvieforawardseachyear,rangingfromjewelrytothecompanystrademark
pinkCadillac(firstawardedin1969).
The company also founded the Mary Kay Ash Charitable Foundation in 1996 to fund
cancerresearchanddomesticviolenceprograms.
MaryKaymarketsmorethan200productsacrossproductcategoriessuchasskincare,
makeup,fragrances,andmensproducts.
MaryKayisaprivatelyheldcompanyandreleaseslimitedfinancialdata.
Corporate sales are estimated to grow at 2.4% to approximately $3,000million in 2012,

MaryKaysworldwidesaleshaveincreasedatacompoundannualgrowthrate(CAGR)
of4.9%since2007.
Table5142:MaryKaysGlobalCorporateSales,
2007to2012
Year
$Million
Change,%
2007
2,367
7.0
2008
2,447
3.4
2009
2,494
1.9
2010
2,549
2.2
2011
2,931
15.0
2012
3,000
2.4
Approximately50%ofMaryKayssalesaregeneratedintheUnitedStates.
TheremainingsalesaregeneratedinAsiaPacific,Canada,Mexico,SouthAmerica,and
Europe.
Since2007,U.S.salesforMaryKayscosmeticsandtoiletrieshaveincreasedataCAGRof
0.2%.
5269
5270
MaryKay
Table5143:MaryKaysCosmeticsandToiletries
Sales,2007to2012
Year
$Million
Change,%
2007
1,053
2008
1,052
(0.1)
2009
1,042
(1.0)
2010
1,039
(0.3)
2011
1,047
0.8
2012
1,063
1.5
NOTE:Salesincluderetailproductsonly;salesaids
purchasedbyconsultantsforsellingeffortsarenot
included.
MaryKayssalesinthecosmeticsandtoiletriesmarketgrow1.5%toreach$1,063millionin
FacialtreatmentsisthelargestrevenuegeneratingcategoryforMaryKayin2012withsales
declining$2millionto$449millionin2012asthecompanystrugglestomaintainanactive
salesforce.
MaryKaycontinuestobethelargestdirectsellingbrandoffacialtreatmentsproducts,
commandingover30%oftotaltradeclasssales.
DirectsalesistheonlybusinessmodelthatMaryKayfollows,utilizingrepresentatives
that can run their own business and conduct parties, classes, and oneonone
consultations. Most of the independent representatives also have their own websites,
and many customers choose to purchase directly from their website. During 2012,
severalarticlesaboutMaryKayarepublishedinmagazines,suchasForbesandBusiness
Weekthatindicatedifficultiesinmaintainingitsdirectsalesforce.
MaryKaytypicallydoesnotlaunchmanynewproductsinayear,yettheTimewiseline
isextendedin2012withRepairVoluFirmListingSerumsaidtohelpfirmandliftskin.
Mary Kay spends little on advertising and promotional dollars to support its facial
treatmentbrands,relyingonitssalesconsultantsandcatalogstopromotethem.
Thefacemakeupcategoryisthesecondlargestcategoryforthemarketerintermsofsales.
MaryKayssalesreach$178millionin2012,up7.2%from$166millionin2011.Sales
continuetoflourishfromthecompanys2011launchofTimeWiseLuminousandMatte
foundations.
MaryKayisthefifthleadingmarketerinthefacemakeupcategoryin2012.In2011,the
companytiedwithRevlonforfifthplace.
4A270
MaryKay
EyemakeupisthethirdlargestcategoryforMaryKaywithsalesat$141millionin2012,up
6.8%.
MaryKayisthefifthleadingeyemakeupmarketerwithacategoryshareof5.2%.
Mary Kays growth is recognized due to several successful launches including its lash
primerandbrowbuilder,creameyeshadowpots,andLashLoveWaterproofmascara.
Thewaterproofversionisaddedin2012asanextensionofthesuccessfullaunchofLash
Lovein2011.
Additionally, the gel eyeliner, although not new, performs well in the second half of
2012.
MaryKayjumpsupto becomethefourthleadingmarketerinthelipsticksandlipglosses
categorywith8.0%categorysalesin2012,surpassingProcter&Gamble.
Mary Kay is the leading directselling brand in the category, with sales reaching
$110millionin2012,up2.8%from2011.Thisisnotable,asthecompanydidnotlaunch
itsnewTrueDimensionlipstickuntillatein2012.Theproductisontrendasitistouted
asasheer,yetbuildablelipcolorinaluxuriousslimlinepackage.
RECENTDEVELOPMENTS
In2012,MaryKaytakesluxurydesigner,MichaelKorstocourtforbreachofcontractand
trademarkinfringement.
According to Mary Kay, Michael Kors has registered a cosmetics line with the same
trademarkinitialsasitself.
In May 2012, Michael Kors files two unauthorized applications for trademark
registration.
ThefirstfilingwiththeU.S.PatentandTrademarkOfficeincludestheMKwithacircle
aroundtheletterwhilethesecondfilingincludesMichaelKorsonthebottomborder
ofthecircle.
AccordingtoMaryKay,theagreementstatesthatMichaelKorscannotuseMKallby
itself, or in close proximity to Michael Kors or in relation with any products
whatsoever.
Newproducts
Table5144:SelectNewProductsIntroducedbyMaryKayintheUnitedStatesin2012
Brand
Category
Description
MaryKay
Eyemakeup
LashLoveWaterproofmascara
Facialtreatments
TimewiseRepairVoluFirmLiftingSerumsaidtohelp
firmandliftskinwhilerestoringyouthfulvolumeand
vibrancysothattheskinappearstighterandlifted.
Thisserumclaimstoinfluencetheproductionof
CollagenVII,minimizingdamagetotheproteinsin
thedermalepidermaljunctionwhichcancause
wrinkles
MaryKay
5271
5272
MaryKay
MARKETINGACTIVITY
MaryKaycontinuestorelyonsalesconsultantstopromoteitsproducts,butisincreasingly
utilizingothervehiclesincludingprintandtelevisionadvertising.
MaryKayisoneoftheleadingdirectmarketerswhosesuccessin2012canbeattributed
tosalesrepresentativesholdingpartiestopromoteratherthansellingoneonone.
MaryKayshowcasesitsfragrancesinitsLookBook,itsquarterlycatalog.
Otherpromotionalvehiclesincludemediaadvertising,discounts,andgiftwithpurchase
(GWP)offers.
Some of the GWP offers from the company include a gift with the purchase of Mini
FragranceFreeSatinHandsPamperingSetandtheMiniNouriShinePlusLipGlossSeton
purchasesof$40.00worthofproducts.
MaryKayscatalogsarecentraltothepromotionofthecompany.Itpromotesvarious
productsinitscatalogs.Thecompanyhasalsointroducedtheconceptofecatalogsfor
thebenefitofthetechsavvyconsumers.Thisinitiativealsoactsameansofconserving
environmentbysavingonpaper.
MaryKaysoverallTMEin2012isapproximately$18million,upfrom$2.8millionin2011.
In 2012, Mary Kay allocates $14.1 million towards magazine advertisements while
$3.5millionisallocatedtowardstelevisionadvertisements.
TheTimewiselineofproductsintroducedin2012receivesthemostTMEat$4.2million.
Thecompanytakesadvantageoftechnologytoreachouttoconsumers.
MaryKayusesavarietyofmarketingtoolsincludingpersonalecommercesitestoaid
its independent beauty consultants, ecatalogs, online virtual makeovers, business
managementtoolsformobiledevices,andsocialmedianetworks.
The digital tools give the independent beauty consultants better access to their Mary
Kay business by broadening their reach, strengthening their customer network, and
increasingawarenessabouttheirbusiness.
MaryKayhastoolsonitswebsitethatallowaninterestedpartytofindasalesconsultantin
theirarea.
Mary Kays website has a Personal Beauty Profiler that helps consumers decide which
facialtreatmentproductswouldbebestforthem.Thecompanyswebsitealsoincludes
the brand catalog and a link to its Facebook, Twitter, YouTube, and Pinterest home
pages.MostofMaryKayssalesassociateshavetheirownwebpage,tokeepintouch
withtheirconsumersviafrequentemails.
To help entice consumers, Mary Kays sales associates frequently hold product
demonstrationgatheringswhereparticipantsaregivenafreeproductsuchasfullsize
lipglossordollarcreditforpurchasing.
4A272
MaryKay
OUTLOOK
MaryKayscosmeticsandtoiletriesbusinessisprojectedtogrowmoderatelyat1.3%during
theforecastperiod.
Thecompanywillcontinuetotakeinitiativestostrengthenitsdirectsellingnetwork,cut
costs,andexpanditsdistributionnetworkintheforecastperiod.MaryKaywillcontinue
to improve its reward and effort equation for its representatives. The marketer offers
webbasedtoolsforitsrepresentativestohelpthemincreasetheirsales.
Catalogsandecatalogswillcontinuetoplayanintegralroleinaidingrepresentativesto
marketandpromoteitsproductsandthereaftergeneratesales.
The company is expected to strengthen its product presence and offers strong
competitiontoitscompetitorswithnewlaunches.
Thefacemakeupcategoryisexpectedtoshowthehighestgrowthduringthenextfiveyears
followedbytheeyemakeupandfacialtreatmentcategories.Themarketerwillcontinueto
focus its efforts on its new Timewise Repair line of products and introduce products with
multifunctional benefits like antiaging with sun protection or foundation with sun
protection.
MaryKaysgrowthinthefragrancesformen,lipbalms,jellies,andtreatments,personal
cleansingproducts,nailpolishes,shavingproducts,andsuncareproductscategoriesis
expected to stay dormant in the forecast years until the marketer undertakes drastic
measurestorevampitspresenceinthesecategories.
The company will need to increase its efforts on R&D and introduce innovative and
technologicallyadvancednewproductsatregularintervalsaheadofitscompetitors.
The multilevel marketing business model is not expected to thrive in the forecast
period,asmoremoderndirectsellingtacticssuchastheInternetsalescapturemarket
share.
Themarketersexpendituresonmarketingareexpectedtoincreaseintheforecastyears.
Mary Kays newly revolutionized approach of adopting digital media as a means of
promotingitsproductswillaidthecompanysgrowthduringtheforecastperiod,2012
to2017.
Additionally,marketingtoolssuchasthecompanyswebsiteandsocialmedianetworks
willbenefitthecompanyincuttingdownitsmarketingcosts.
Instorepromotionswillbeencouragedtoreachouttothemasses.
Distribution of samples to the masses is also likely to have a positive impact on the
companyssales.
Mary Kays sales are projected to experience a 1.3% CAGR increase to $1,333million by
5273
5274
MaryKay
andToiletriesforMaryKaybyCategory,2012to2017
Category
CAGR,%
Facemakeup
2.5
Eyemakeup
1.8
COMPANYAVERAGE
1.3
Facialtreatments
1.1
0.9
Fragrancesforwomen
0.6
Handandbodylotions
0.4
Fragrancesformen
Nailpolishes
Shavingproducts
Suncareproducts
4A274
MERCK
Table5146:MercksSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
2012
159
173
16
19
176
193
16
16
192
209
SUNCAREPRODUCTS
Coppertone
CoppertoneWaterBabies
BaindeSoleil
Total
HANDANDBODYLOTIONS
Dr.Scholls
TOTAL
COMPANYOVERVIEW
Merck&Co.,Inc.isaglobalhealthcarecompanythatdevelops,manufactures,andmarkets
medicines, vaccines, biologic therapies, overthecounter (OTC) remedies, animal health
products,andpersonalcareproducts.
ItisbasedoutofWhitehouseStation,NJ.
Merck was founded in 1891 and employs approximately 83,000 employees globally,
with32,500intheUnitedStatesincludingPuertoRico,asofDecember31,2012.
Thecompanyemploysapproximately13,600peopleinitsresearchteam.
Merckhasthreereportablebusinesssegments:
Pharmaceuticals: The company offers human health pharmaceutical products,
including therapeutic and preventive agents for the treatment of human disorders in
the areas of bone, respiratory, immunology, dermatology, cardiovascular diseases,
diabetes and obesity, infectious diseases, hypertension, heart failure, urology,
bronchospasm,neurosciencesandophthalmology,andoncology.
Animal Health: The company offers antibiotics, antiinflammatory products, vaccines,
products for the treatment of fertility disorders, and parasiticides for cattle, swine,
horses,poultry,dogs,cats,salmon,andfish.
Consumer Health: This segment includes antihistamines, products for constipation,
cold medicines, nasal decongestant sprays, and laxative tablets; foot care products,
which comprise topical antifungal products, and foot and sneaker wetness products;
and sun care products, such as sun care lotions, sprays, dry oils, and lipprotection
products,aswellassunlesstanningandsunburnreliefproducts.
5276
Merck
Thecompanydistributesitssuncareandfootcareproductsthroughwholesale,retaildrug,
foodchainoutlets,massmerchandisers,clubstores,andspecialtychannels.
Mercks sales grow to reach $47,267 million in 2012, down 1.6% from $48,047million in
2011.
Since2007,thecompanyssaleshavegrownatacompoundannualgrowthrate(CAGR)
of14.3%.
The companys net profit witnesses a decline from 2011 figures, at $6,299million in
2012.
ThecompanyssalesoutsidetheUnitedStatesareprimarilydonethroughsubsidiaries.
Table5147:MercksGlobalCorporateSales,2007to2012
$Million
Fiscalyear
Sales
Netprofits
Marginonsales
Returnonequity
2007
24,198
3,275
13.5
16.5
2008
23,850
7,808
32.7
37.5
2009
27,428
12,899
47.0
21.2
2010
45,987
861
1.9
1.7
2011
48,047
6,392
13.3
11.2
2012
47,267
6,299
13.3
11.9
Table5148:MercksGlobalSalesbyRegion,2011and2012
$Million
Region
2012
2011
2012
UnitedStates
20,495
20,392
42.7
43.1
Europe,MiddleEast,andAfrica
13,782
12,990
28.7
27.5
Japan
4,835
5,102
10.1
10.8
Allother
8,935
8,783
18.6
18.6
48,047
47,267
100.0
100.0
4A276
%Oftotal
2011
Total
Merck
5277
Table5149:MercksGlobalSalesbyBusinessSegment,2011and2012
$Million
Businesssegment
2011
2012
41,289
40,601
Miscellaneoussegmentsa
5,093
Allotherb
1,666
Pharmaceuticals
%Oftotal
2011
2012
85.9
85.9
6,412
10.6
13.6
254
3.5
0.5
Total
48,047
47,267
100.0
aIncludessegmentssuchasanimalhealthandconsumerhealthcare.
bIncludessalesofdivestedproductsorbusinessandthirdpartymanufacturingsales.
100.0
Table5150:MercksCosmeticsandToiletries
Sales,2007to2012
Year
$Million
Change,%
2007r
189
2008r
196
3.7
2009
181
(7.7)
2010
185
2.2
2011
192
3.8
2012
209
8.9
rRestated.
The sun care products category is the largest category for Merck in the cosmetics and
toiletries market in 2012 with sales at $193million in 2012, up 9.7% from $176million in
2011.
ThecompanydisplacesJohnson&Johnsontobecomethesecondleadingmarketerin
thesuncareproductscategory.
In2012,Mercksshareinthesuncareproductscategoryincreasesfrom17.9%in2011
to18.4%in2012.
The companys growth in 2012 is due to the introduction of two new product lines:
SportsProSeriesdesignedforathletesandsportspersons,andWetnCleardesigned
forbabies.
TheCoppertoneWaterBabiesbranddoesexceptionallywellwithagrowthof18.8%to
postsalesat$19millionin2012,upfrom$16millionin2011.
5278
Merck
As the awareness about the dangers of the UV rays among consumers increases,
parentsaretakingprecautionarymeasurestosafeguardtheirbabiesandkidsskin,as
aresultofwhichthekidsandbabiessegmentgarnersincreasedattention.
CoppertoneWaterBabies,apediatricianrecommendedbrand,offersproducts,suchas
QuickCoverLotionSpraySPF50Sunscreen,LotionSPF100+Sunscreen,FoamingLotion
SPF75+Sunscreen,andStickSPF55Sunscreen.
MercksDr.Schollsretainsitsleadinthefootcaresegmentofthehandandbodylotions
category,withsalesat$16millionin2012,flatfrom2011levels.
Dr.Schollsrepresents38.1%ofthetotalfootcareproductssegmentsalesin2012,flat
from2011levels.
RECENTDEVELOPMENTS
In2012,MercksettlesalawsuitagainstitsCoppertonelineofsunscreens.
Although Merck initially denied all the allegations, it has decided to make the
settlement in order to avoid the expense and burden of continuing the litigation any
further.
Merck has agreed to stop using the terms sunblock, waterproof, sweatproof, all
day or all day protection on its Coppertone sunscreen products in the U.S. market
afterJune2012.
For the settlement, Merck is required to pay $1.50 for each eligible Coppertone
sunscreen product that was purchased from July 2006 and returned resulting in an
aggregateofanywherebetween$3millionand$10milliondollars.
Alsoin2012,Merckhasbeensuedforaclassactionconsumerfraudlawsuit.
According to the lawsuit, Mercks advertisements for its Coppertone sunscreens are
deceptivelylabeled,advertised,andmarketed.
Theplaintiffsargumentrevolvesaroundthefactthatconsumershavebeenmisledby
promises of the products providing full defense against the ultravioletA (UVA)
radiation,wheninrealitytheseproductsdonotblockallorclosetoalloftheUVArays.
In December 2011, the company had received prior warnings from the National
AdvertisingDivision(NAD)ofBetterBusinessBureauClaimstostopadvertisingclaims
foritssuncareproductswithaSPFof15orhigherwhichprotectsacross100%ofthe
UVA/UVBspectrum.
AlthoughlaterNADwasabletodeterminethatevidenceprovidedby Merckpartially
supportedtheevidence,itdidnotsupporttheclaimtoprovide100%protection.
Mergers,acquisitions,anddivestures
Therearenomergers,acquisitions,anddivestituresin2012.
Managementchanges
Therearenomanagementchangesin2012.
4A278
Merck
Newproducts
Table5151:SelectNewProductsIntroducedbyMerckintheUnitedStates,2012
Brand
Category
Description
Coppertone
Suncareproducts
SportProSeriesContinuousSpraySunscreenisformulatedwithDuraFlex
technologythatprovidesUVAandUVBprotectionandiswaterresistantfor80
minutes.Itisappropriateforacneproneskin,andisavailableinSPF15,SPF30,
andSPF50variants
Coppertone
Suncareproducts
WetnClearContinuousSpraySPF30providesUVAandUVBprotectionandis
waterresistantforupto80minutes.Itisdermatologicallytestedandisavailable
inSPF30andSPF45+variants
Coppertone
Suncareproducts
WetnClearKidsContinuousSpraySPF45+providesUVAandUVBprotectionand
iswaterresistantforupto80minutes
MARKETINGACTIVITY
Mercksupportsitsbrandswithtraceablemediaexpenditures(TME)of$17.7millionin2012,
Television advertisement is the most popular advertising medium for the marketer,
followed by magazine advertising. Collectively, they represent almost 96% of the
marketerstotalTMEin2012.
Television and magazines advertisements receive a TME support of $13.4 million and
$3.6million,respectively.
CoppertonereceivesMercksentireTMEallocationin2012.
CoppertonesWetnClearreceivesthemaximumTMEsupportat$7.4millionfollowed
byCoppertonesProSeriesat$6.4millionin2012.
Sponsorshipactivityhelpsdrivegrowthforthemarketerinthesuncareproductscategory
in2012.
Theprimarygoalofthesesponsorshipactivitiesincludepromotingnewproductsand
lineextensionsfromestablishedandstartupcompanies,educateconsumersaboutthe
attributesoftheproducts,andgatherretailplatformsforpromotionalactivities.
Coppertone uses its partnership with Six Flags to promote the Sports Pro Series and
Wet n Clear product lines. The partnership provides the brand a platform and an
environmenttocommunicatetochildrenandadultstheimportanceofprotectingtheir
skinfromthesunsrayswhiletheyareoutdoors.
Merckcontinues to focus on the social media, to spread awareness about its Coppertone
brandandnewproductintroductions.
Socialnetworksites,suchasFacebookandTwitterareoftenutilizedtopublicizenew
productintroductions.
In2012,CoppertoneholdsacontestonitsFacebookpagetofindthenextLittleMiss
Coppertone in an effort to give the brands advertising campaign a new look by
rekindlinginterestinthelittlegirlandthedogaCoppertonesymbolsince1953.The
contest is promoted in a number of ways including an advertisement in the People
magazine for the Coppertone Ultra Guard sunscreen spray that is portrayed with a
scratchandsnifffeaturewhichreleasesthetrademarkCoppertonescent.
5279
5280
Merck
OUTLOOK
Merck is forecast to post a healthy growth during the forecast period, at CAGR of 3.4%
through2017.
The company will continue to grow in line with its fourparty growth strategy that is
focused on: executing its core businesses including its largest markets, core brands,
newly launched brands, and research and development efforts; geographical
expansion; expansion of consumer care and animal health businesses and; managing
costswhileinvestingforthefuture.
Thecompanywillcontinuetoemphasizeonitsresearchanddevelopmentinitiativesto
compete with other marketers with respect to quality control, ability to meet
consumersexpectations,andexpanditsdistributionnetwork.
To meet the evergrowing changing market conditions, the marketer will continue to
enterexternalalliances,jointventures,andlicenses,andstrivestoacquirebusinesses.
The marketers success in the cosmetics and toiletries industry will depend upon its
abilitytopromoteitsnewproducts.
Merck has a strong presence in the sun care products category with its flagship brand,
Coppertone.
The companys largest brand, Coppertone, which has a loyal customer base, will
continuetogathersalesandislikelytoremainasoneofthetopfivemassbrandsinthe
suncareproductscategoryduringtheforecastperiod.
Thecompanyislikelytodiversifyitsproductofferingswiththeintroductionofsuncare
productsexclusivelyforfaceinordertosafeguarditspositioningfromthethreatening
blurbetweentheskincareandsuncareproducts.
Its Coppertone for Water Babies brand will continue to gain sales over the next five
yearswithrisingawarenessamongconsumersabouttheharmfuleffectsoftheUVrays.
AlthoughsalesofMercksDr.Schollsfootcareproductshaveremainedstablein2012,the
brandisprojectedtogrowataCAGRof1.2%duringtheforecastperiod.
There is a rising obese American population with a high possibility of developing
callousedfeetresultinginincreasedsalesofcorn,callus,andwartremovers.
Additionally, with the growing number of people suffering from diabetes, there is a
growingtendencyofthemdevelopingailmentssuchaswartsandcorns.
Furthermore, with the growing number of women adopting the use of tightfitting,
highheeled, and opentoed shoes on a daily basis, there is a likelihood of increased
demandforfootrepairandcomfortingproducts.
However,furthergrowthofthemarketerinthecosmeticsandtoiletriesindustryisoffsetby
itslimitedpenetrationwithinthesuncareproductsandhandandbodylotionscategories.
Sales of Mercks brands in the cosmetics andtoiletries market are projected to grow at a
CAGRof3.4%,toreach$247millionin2017,upfrom$209millionin2012.
4A280
Merck
Table5152:ForecastDollarSalesGrowthof
CosmeticsandToiletriesforMerckbyCategory,2012
to2017
Category
CAGR,%
Suncareproducts
3.6
COMPANYAVERAGE
3.4
Handandbodylotions
1.2
5281
5282
Merck
4A282
PROCTER&GAMBLE
Table5153:Procter&GamblesSalesofCosmeticsandToiletriesinthe
$Million
Category/brand
2011
SHAMPOOS
2012
Head&Shoulders
244
266
PanteneProVr
259
255
HerbalEssencesr
130
132
Aussie
46
48
Nioxin
27
29
Gillette
16
17
Fekkai
10
12
739
765
Secret
348
350
OldSpice
258
263
76
74
682
687
637
618
OralB
CrestKids
Gleem
647
628
Sebastian
Totalr
Gillette
Total
TOOTHPASTES
Crest
Total
FACIALTREATMENTS
Olay
593
570
DDF
31
28
SKII
10
Covergirl
633
609
Total
(Continued)
5284
Procter&Gamble
$Million
Category/brand
2011
2012
Olay
164
170
OldSpicer
104
105
Ivoryr
72
71
GilletteSeries
24
20
Safeguard
17
16
Camay
Kandoo
385
385
335
328
167
165
HerbalEssencesr
96
98
Aussie
45
48
Nioxin
27
30
Fekkai
Sebastian
351
357
142
130
ClairolNaturalInstincts
75
67
NiceNEasyColorBlendFoam
35
37
BalsamColor
FrostNTip
ClairolHydrience
ClairolLovingCare
ClairolMensChoice
ClairolTouchofSun
ClairolUltress
58
62
341
308
Totalr
FACEMAKEUP
Covergirl
CONDITIONERS
PanteneProVr
Totalr
ClairolNiceNEasy
Allother
Total
(Continued)
4A284
Procter&Gamble
$Million
Category/brand
2011
2012
304
290
215
204
OralB(Battery)
29
29
Crest
11
11
Total
255
244
PanteneProV
70
61
HerbalEssences
53
56
Aussie
56
55
Sebastian
35
34
Nioxin
11
13
Fekkai
227
222
212
200
EYEMAKEUP
Covergirlr
TOOTHBRUSHES
OralB
Total
CrestWhitestrips
MOUTHWASHES
Crest
105
110
Scope
75
76
OralB
181
187
GucciGuiltyPourHomme
40
42
OldSpice
25
25
LightBluePourHomme
23
22
TheOneForMen
23
21
TheOneSport
11
GilletteSeries
10
10
GuccibyGucci
13
10
EauLacosteBlanc
Dolce&Gabbana
Total
FRAGRANCESFORMEN
(Continued)
5285
5286
Procter&Gamble
$Million
Category/brand
2011
2012
LacosteEssential
VinceCamuto
LacosteEssentialSport
TheOneGentleman
GucciPourHommeII
Allother
164
175
Dolce&GabbanaLightBlue
44
43
GucciGuilty
22
15
Dolce&GabbanaTheOne
17
14
GucciGuiltyPremiere
10
FlorabyGucci
FlorabyGucciEauFraiche
Inspire
SecretBodyMists
GuccibyGucci
ByNight
GucciEnvyMe
Dolce&Gabbana
GiorgioForWomen
Joy
LacosteTouchofPink
Red
21
22
133
134
Total
FRAGRANCESFORWOMEN
Allother
Total
Covergirl
MaxFactor
Total
DENTUREPRODUCTS
Fixodentr
114
103
114
103
103
98
(Continued)
4A286
Procter&Gamble
$Million
Category/brand
2011
2012
82
84
TheArtofShaving
10
OldSpice
91
95
22
20
SHAVINGPRODUCTS
Gillette
Totalr
HANDANDBODYLOTIONS
Olay
Olay
19
Textures&Tones
11
11
PanteneProV
10
Total
21
19
TheArtofShaving
GilletteComplete
Total
NAILPOLISHES
Covergirl
TOTALr
5,952
5,883
rRestated.
NOTE:Allotherincludesalesofsmallerbrandsthatthecompanyowns.
COMPANYOVERVIEW
Foundedin1837,Procter&Gambleisaglobalmarketleaderinconsumergoods,suchas
household products, personal care products, food and beverage products, and overthe
counter(OTC)medicines.
Its headquarters is located in Cincinnati, OH. The company celebrates a milestone in
2012withits175thanniversary.
In2012,thecompanysemployeestrengthisapproximately126,000peopleacross80
countries.
Thecompanymarketsmorethan300brandsin180countriesprimarilythroughmass
merchandisers, grocery stores, membership club stores, drug stores, and high
frequencystores.
5287
5288
Procter&Gamble
Other retail outlets where Procter & Gamble products can be found include
departmentstores,perfumeries,pharmacies,salons,andecommercesites.
Thecompanygloballycompetesin38productcategories,withanaveragepresenceof
19categoriesinanygivencountry.
IntheUnitedStates,thecompanycompetesinmorethan35categories.
Procter& Gambles organizational structure comprises its Global Business Units (GBUs),
GlobalOperations,GlobalBusinessServices(GBS),andCorporateFunctions(CF).
The companys GBU is divided into five segments: Beauty, Grooming, Health Care,
FabricCareandHomeCare,andBabyCareandFamilyCare.
The companys Beauty segment comprises antiperspirant and deodorant, cosmetics,
haircare,haircolor,personalcleansing,prestigeproducts,salonprofessional,andskin
care.
The Grooming segment includes blades and razors, electronic hair removal devices,
haircareappliances,andpreandpostshaveproducts.
Procter & Gambles Health Care segment comprises feminine care, gastrointestinal,
incontinence, rapid diagnostics, respiratory, toothbrush, toothpaste, other oral care,
otherpersonalhealthcare,vitamins/minerals/supplements.
TheFabricCareandHomeCaresegmentcomprisesbleachandlaundryadditives,air
care,batteries,dishcare,fabricenhancers,laundrydetergents,petcare,professional,
andsurfacecare.
TheBabyCareandFamilyCaresegmentincludesbabywipes,diapersandpants,paper
towels,tissues,andtoiletpapercategories.
Thecompanyssalesincrease3.2%from$81,104millionin2011to$83,680millionin2012.
The companys net earnings see a further dip in 2012, at $10,756million from
Table5154:Procter&GamblesGlobalCorporateSales,2007to2012
$Million
Yeara
Change,%
Netprofits
2007r
71,095
10,340
14.5
15.4
2008r
77,714
12,075
15.5
17.3
2009r
75,295
13,436
17.8
21.2
2010r
77,567
12,736
16.4
20.7
2011r
81,104
11,797
14.5
17.3
10,756
12.9
16.8
2012
83,680
rRestatednetsales.
Sales
Profitmargin
4A288
Returnonequity
Procter&Gamble
Table5155:Procter&GamblesSalesbyGlobal
BusinessUnit,2011and2012
%Oftotalsales
Segment
2011
2012
HouseholdCare
67.0
51.0
Beauty&Grooming
33.0
49.0
100.0
100.0
Total
Table5156:Procter&GamblesSalesbyBusinessSegment,2011and2012
$Million
Segment
2011
2012
FabricandHomeCare
26,536
27,254
BabyandFamilyCare
15,606
16,493
Total
45,298
43,747
19,937
20,318
8,245
8,339
HealthCare
12,033
12,421
Total
40,215
41,078
CORPORATE
(1,255)
(1,255)
TOTAL
81,104
83,680
HOUSEHOLDCARE
BEAUTY&GROOMING
Beauty
Grooming
Procter & Gambles cosmetics and toiletries sales in the U.S. market have declined to
$5,883millionin2012,down1.2%from$5,952millionin2011.
SaleshaveexperiencedaCAGRof1.6%since2007.
Table5157:Procter&GamblesCosmetics&Toiletries
Sales,2007to2012
Yearr
$Million
Change,%
2007
5,428
2008
5,592
3.0
2009
5,617
0.4
2010
5,809
3.4
2011
5,952
2.5
2012
5,883
(1.2)
rRestated.
5289
5290
Procter&Gamble
Procter&GambleremainstheclearleaderintheU.S.personalcaremarket.Both,through
acquisitionandorganicgrowth,thisleadershiphassolidifiedoverthelastdecade.
However,2012provestobeoneofitsmostchallengingyears,asProcter&Gamble's
categoryleading brands have lost their footing in several categories including
shampoos,toothpastes,andcolorcosmetics.
ThereareanumberoffactorscausingProcter&Gambletolosegroundtoitsmajor
competitorsintheUnitedStates.Themainreasonappearstobethecompanys$10
billion cost saving plan announced in February 2012 which has left some of its
brands lacking necessary marketing support, particularly in light of its competitors
increasingtheirownpromotionalactivities.
Furthermore, Procter & Gambles cost cutting on R&D has affected its rate of new
productintroductionsandabilitytokeepupwiththerapidlychangingmarketplace.
ShampooscontinuetobethelargestcategoryforProcter&Gamblein2012.Itisalsothe
leadingmarketerintheshampooscategoryin2012.
Salesofthemarketergrow3.5%in2012from$739millionin2011to$765millionin
2012.
Procter&Gamblehasa29.2%marketshareoftheoverallcategoryssalesin2012.
The company markets eight brands in the category, including the top two brands
PanteneProVandHead&Shoulders.
Head&Shouldersbecomesthecategoryleaderin2012,displacingPanteneProV.
Head&Shoulderssalesgrow9.0%,from$244millionin2011to$266millionin2012.
Thebrandsgrowthisdrivenbyimprovedmarketingandpromotionalactivitiesinthe
category.Furthermore,until2012therewasalackofseriouscontendersinasegment
that has high demand. Many men and women suffer from dandruff and Head &
Shoulders,asaunisexbrand,solvesthisspecificproblem.
Procter & Gamble launches various campaigns to support the sales of its Head &
Shouldersbrandinthecategory.ThemarketersignssoccerplayerLionelMessiasits
spokespersontopromoteitsHead&Shouldersbrand.
PanteneProV,thesecondleadingbrandinthecategory,hasacategoryshareof9.7%
Sales for the brand decline by $4million to $255million in 2012, down from
$259millionin2011.
Pantene ProV has limited new product activity in 2012 compared to 2011, when
Procter&GambleaddedanumberofproductstothePanteneProVline.Thebrand
alsosuffersfromlackofdifferentiation.
4A290
Procter&Gamble
DeodorantsandantiperspirantsisthesecondlargestsalesgeneratingcategoryforProcter
&Gamble.
The marketer is the secondleading marketer in the category in 2012. Procter &
Gambleexperiencesmarginalgrowthof0.7%toreach$687millionin2012,upfrom
$682millionin2012.
Thecompanysshareinthecategoryfallsfrom34.1%in2011to33.7%in2012.
brands.
categorysalesin2011.
Procter&Gamblestraceablemediaexpenditure(TME)supportfortheSecretbrand
increases4.5%from$39.9millionin2011to$41.7millionin2012,withSecretClinical
Strength and Secret Outlast being allocated the most TME at $18.8million and
$22.5million, respectively. In 2012, the marketer introduces the Secret Outlast in
Invisible Solid, Clear Gel, and Smooth Solid variants. To promote the Secret Outlast
Collection, Procter & Gamble partners with Jenni Pulos, a television personality and
actress, to help consumers conquer their hectic work schedules while the product
providesthemwith48hourodorprotection.
Old Spice, the marketers secondleading brand in the category, posts sales of
$263million in 2012, up 1.9% from $258million in 2011. Old Spice, a malecentric
brand, has changed its approach and targets men of all age groups, as the brand
previously targeted only older men, thereby improving its brand image. The brand
benefitsfromitsloyalconsumerbaseasaresultofitslongpresenceinthecategory.
In2012,thebrandhasanotherviralhitwithitsMuscleMusicPlayervideofeaturing
former NFL player Terry Crews who controls a variety of instruments simultaneously
byflexinghisforearms,biceps,abs,deltoids,andquads.Theadvertisementactsasa
musicmaker game, involving interaction with consumers who have the ability to
controlCrewsbodyandinstruments.Oncethevideofinishes,usershavetheoptionof
recording it. The brands video on the YouTube channel is an instant hit during its
initiallaunchandcontinuestogainalotofhitsonYouTube.
AnothermarketingcampaignofOldSpicefeaturesNFLstarGregJenningspromoting
theChampionDeodorantinaseriesofsevencommercialsthatgoliveduringtheNFL
2012season.
SalesforGillettedecline2.6%to$74millionin2012,downfrom$76millionin2011.
ThecategoryshareofGillettedeodorantsdeclines0.2%from3.8%in2011to3.6%in
2012.Gillettessalesdeclinearearesultofthelackofnewnessfromthebrandwith
respecttoproducts,changeinformulations,orpackagingchanges.
5291
5292
Procter&Gamble
Toothpastes is the thirdleading category for Procter& Gamble in the U.S. cosmetics and
toiletriesindustryin2012.
Procter & Gamble experiences sales decline of 2.9% from $647million in 2011 to
$628millionin2012andthemarketerslidestothesecondpositioninthetoothpastes
category.
The companys market share slides from 37.6% in 2011 to 35.9% in 2012. Although
Crest retains its top ranking in the category, Colgate erodes its share aided by the
successofColgate360OpticWhiteandColgate360SensitiveProRelief
SalesofCrest,thecompanyslargestmasterbrandinthecategory,declineby3.0%to
$618millionin2012from$637millionin2011.
Thebrandssalesdeclineisinlinewiththedecreaseinthemarketingandadvertising
supportin2012.
The marketer decreases the marketing support for the Crest brand significantly, by
50.4%from$143.9millionin2011to$71.4millionin2012.
Increase in the prices of Procter & Gambles products in 2012 is also a factor
contributingtosalesdeclineinthecategory.
Decreaseincouponingactivitybythemarketerin2012alsolimitsthegrowthofthe
companystoothpastebrands.
Limitednewproductactivityalsolimitsthegrowthofthemarketerin2012.
However, some of the key launches in 2012 by Procter & Gamble include Crest Pro
Health Clinical Plaque Control toothpaste and Crest 3D White Glamorous White
toothpaste.
Thefourthleadingcategoryforthemarketerin2012isfacialtreatments.
Procter& Gambles Olay remains the largest mass brand in the facial treatments
category,accountingforslightlyoveronequarteroftradeclasssales.
Thebrandssalesdecline3.9%atthemanufacturerslevel,from$593millionin2011
to$570millionin2012.Thebrandalsodeclinedin2010.
A number of factors contribute to Olays soft sales during 2012, including increased
competitionatmultiplepricepoints,extensivemarketingcampaignsfromcompeting
brands,consumerstradinguptoluxuryproducts,massprivatelabelsthatmimicmany
ofOlaysproductlines,andachangeinretailerplanograms.
Thebrandhaslostouttonewerinnovationsbycompetitors,suchasLOralandEste
Lauder.
While most of the prestige brands, such as Clinique and Este Lauder, launch BB
creams,withmanymassbrandsfollowing,Olaydidnottakeadvantageofthismajor
trend of hybrid makeup/skin care creams until late 2012, when it launches a color
correction(CC)cream.
Olay takes some major steps to become more innovative in late 2012 with the
reformulationofitsRegeneristlinetoofferfasterandmorevisibleresults.
The ProX franchise suffers as the price points for this mass line are comparable to
someentrylevelluxurybrands.Infact,theProXlineisthefirstmasslinetobreakthe
$25.00pricebarrier,andopenupthedoorforothermassbrandstotryaswell.The
ProXlineisextendedwithaSpotFightingTreatmenttoreducedarkspotsandeven
outskintone.
During 2012, the company works to develop a new line that launches in early 2013
gearedforyoungerconsumers,andwithlowerpricepoints,calledOlayFreshEffects.
Procter & Gamble is one of the largest personal care advertisers and invests
$125.3million supporting the Olay brand during 2012, down from $197.3million in
2011.
4A292
Procter&Gamble
In 2012, sales of Procter & Gamble in the personal cleansing products category remain
stableat$385millionin2012,flatfrom2011levels.
The marketer is present in the category with its Olay, Old Spice, Ivory, Gillette,
Safeguard,Camay,andKandoobrands.
Body washes is the largest segment for the marketer in 2012, and is the second
leadingmarketerinthebodywashessegment,accountingfor18.5%ofthesegments
salesin2012.Themarketerssalesinthesegmenttotal$251millionin2012,up3.3%
33.5% of the marketers sales in 2012, down from 35.1% in 2011. The decline in the
marketers share in the segment is due to the poor performance of Olay, Ivory, and
Safeguard.
approximately 70.0% from $114.1million in 2011, to $40.0million in 2012. The
brands.
Procter&Gambleisthethirdleadingmarketerinthefacemakeupcategory,withsalesat
Procter&GamblecompetesinthemasstradeclasswithitsCovergirlbrandandwith
itsDolce&Gabbanalinewithintheluxurytradeclass.Dolce&Gabbanassalesarenot
itemizedinthisreport.
Covergirls category share declines slightly from 11.9% in 2011 to 11.3% of sales in
2012,assalesdeclineacrossallproductcategoriesexceptpowder,whichisfueledbya
newproduct,Covergirl&OlayPressedPowder.
Covergirl suffers territory encroachment from competitive new launches including
LOralsTrueMatchSuperBlendableMakeup,RevlonsPhotoreadyAirbrushmousse
makeup,andMaybellinesDreamNudeAirfoammakeup.
Despite having an impressive cast of megastar spokesmodels including Taylor Swift
and Pink, Covergirl simply does not have comparable new product launches to
promote in 2012. However, the company appears to be rectifying the situation with
newproductsalreadylinedupfor2013.
In 2012, Procter & Gamble decreases its advertising budget by 8% down to
$87.1million.Approximately68%ofTMEisusedtopromoteCovergirlandOlaySimply
AgelessandToneRehab2in1foundationproducts.CovergirlsCleanMakeupandTru
Blendfoundationissupportedbycloseto$24millioninadvertising.
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Procter&Gamble
In 2012, Procter & Gamble is the secondleading marketer in the conditioners category,
withashareof21.6%inthecategoryssales.
Salesforthecompanygrow1.7%,upfrom$351millionin2011to$357millionin2012.
PanteneProVmaintainsitspositionasthetopbrandinthecategory,withashareof
10.0%.Salesforthebranddecline1.2%,from$167millionin2011to$165millionin
2012.
Limitednewproductactivity,lackofdifferentiation,andlimitedpromotionalactivities
contributetothebrandssalesdeclinein2012.
The only significant launches under the Pantene ProV brand in 2012 are Advanced
KeratinconditionerandAgeDefyconditioner.
HerbalEssences,thesecondlargestbrandforProcter&Gamble,hasacategoryshare
of5.9%in2012.
It is the fifthlargest brand in the category. Sales for the brand are up 2.1% from
New product activity from Herbal Essences contributes to the brands growth in the
category.Thecompanylaunchesarangeofnaturalpositionedconditionersincluding
HoneyImStrongconditionerandLongTermRelationshipundertheHerbalEssences
brand.
SalesforAussiegrow6.7%from$45millionin2011to$48millionin2012.
Improvedpromotionalactivities,suchasinstoremarketing,contributetothebrands
Intheprofessionaltradeclass,Procter&Gamblehasasegmentshareof2.0%in2012;
SebastianistheonlybrandmarketedbyProcter&Gambleintheprofessionalsegment.
Sales for Sebastian decline by $1million to $7million in 2012. The brand has been
strugglingtoregainitsedgeasatrendybrand.
Sales of Procter & Gamble, the secondleading marketer in the hair coloring products
category,declineto$308millionin2012,down9.7%from$341millionin2011.
Procter&Gamblesoverallsharein the categorys sales drop from 25.8% in 2011 to
23.4%in2012,duetothedeclineinthesalesofClairolNiceNEasyandClairolNatural
Instinctslines.
Limitednewproductactivityalsocontributestothemarketersdeclineinthecategory.
Salesdeclineforthemarketerinthecategorycanalsobeattributedtothesignificant
decreaseinthemarketingactivity.Procter&GamblesTMEforhaircoloringproducts
declines significantly by 32.2% in 2012, down from $82.3million in 2011 to
$55.7millionin2012.
ClairolNiceNEasyColorBlendFoamistheonlybrandtoexperiencegrowthin2012;
thebrandgrowsby5.7%,from$35millionin2011to$37millionin2012.
Thesuccessoffoambasedcolorantssupportsthebrandsgrowthinthecategory.
ThesalesofthebrandarealsosupportedbyaTMEofalmost$21millionin2012.
NiceNEasydrops8.5%whileNaturalInstinctsdeclinesby10.7%to$130millionand
$67million,respectively,in2012.
Balsam Color manages to maintain its sales at $6million in 2012, for the second
consecutiveyear.
FrostNTipssalesdeclineby14.3%,from$7millionin2011to$6millionin2012.
Themarketerdiscontinuesseveralproductsin2011,contributingtothesalesdecline
in2012.
Some of the brands that were discontinued by the marketer in 2011 include Loving
Care,ClairolHydrience,ClairolMen'sChoice,ClairolTouchofSun,andClairolUltress,
amongothers.
4A294
Procter&Gamble
Procter & Gamble moves down to the third position in the eye makeup category as sales
slidedown4.6%in2012to$290millionfrom$304millionin2011.
The marketers share of the category also declines from 11.6% in 2011 to 10.7% in
2012.
ThenewlaunchesinmascarathatincludetheLashBlastfranchiseperformwellforthe
Covergirlbrand,butsalesdonotexceedthefalloutfromtheeyeshadowandeyeliner
sales decline. The brand does not compete in the eyebrow category, which fuels
growthformanymarketersin2012.
Procter & Gamble is the secondleading advertiser in the category with TME of
$74.2millionin2012,down27%from$101.6millionin2011.TwothirdsoftheTME
supportthebrandsmascaraproducts.
In 2012, Procter& Gamble continues to be the largest marketer in the toothbrushes

category,representingalmostonethirdofthecategorystotalsales.
However,thecompanysmarketsharedropsfrom35.2%in2011to32.9%in2012,as
overallsalesdecreaseby4.3%,from$255millionin2011to$244millionin2012.
Sales growth is offset with the decline in its leading brand OralB. The brands sales
declineduetodecreaseinmarketingactivity,suchasdiscountsandcouponsin2012.
Increasing competition from ColgatePalmolive in the toothbrushes category also
hampersthegrowthforProcter&Gamblein2012.
Procter&Gamble,wellknownforitsproductinnovations,investslessinR&Dandnew
productactivityin2012,limitingthemarketerssuccessinthecategory.
OralB continues to be the largest brand in this category with a decrease in market
sharefrom33.7%in2011to31.4%in2012.
Thedeclineisdrivenbymanualtoothbrushes,whichdecline5.1%from$215millionin
2011 to $204million in 2012. Battery toothbrushes, a much smaller segment, see
stablesalesat$29millioneachin2011and2012.
Limited new product introductions and marketing activities, such as discounts and
coupons,restrictthegrowthoftheOralBmanualtoothbrushesin2012.
Increaseinpricepointsoffsetsthebrandsgrowthinthecategory.
Procter&Gamblecontinuesretainthethirdpositioninthehairstylingproductscategory.
Salesofthemarketerdecrease2.2%to$222millionin2012from$227millionin2011.
Limited new product activity and a decrease in the marketing and promotional
activitiescontributetothesalesdeclineforthemarketerinthecategory.
PanteneProV,thelargestbrandofthemarketerinthecategory,remainsthethird
leadingbrandinthemasstradeclass.Salesofthebranddeclineto$61millionin2012,
down 12.9% from $70million in 2011. Limited new product activity and substantial
decrease in promotional activities offset the brands growth in 2012. The marketer
significantly decreases its TME support for the Pantene ProV brand in 2012, from
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Procter&Gamble
SalesofHerbalEssencesgrowby5.7%to$56millionin2012,upfrom$53millionin
2011. Increased promotional and marketing activity supports the brands growth in
2012.Procter&Gamblesupportsthebrandwithapproximately$6.8millioninTMEin
2012,upfrom$0.5millionin2011.
SalesofProcter&GamblesAussiedeclineby$1millionto$55millionin2012.
Procter & Gamble is present in the professional trade class with its Sebastian and
Nioxinbrands.In2012,themarketeroccupies9.4%oftheprofessionaltradeclass,up
from9.2%in2011.Sebastianisthesixthleadingbrandintheprofessionaltradeclass
with sales at $34million, down 2.9% from $35million in 2011. Procter & Gambles
other professional brand, Nioxin experiences growth in 2012. The brand grows by
Procter&Gambleremainstheleaderinthetoothwhiteningproductscategory,withaslight
decreaseinitsmarketsharefrom73.9%in2011to73.8%in2012.
Collective sales for the marketer decline by 5.7%, from $212million in 2011 to
$200millionin2012.
Crestcontinuestobethemainbrandthecompanymarketsinthecategory.
DespiteanincreaseinTMEin2012,Procter&Gambleexperiencessalesdeclinedueto
limitednewproductactivity.
Higher price points compared to its competitors also results in sales decline for the
In 2012, Procter & Gamble introduces Crest 3D White Glamorous White toothpaste
andCrest3DWhiteIntensiveProfessionalEffectsWhitestrips.
Procter & Gamble is the secondlargest marketer in the mouthwashes category with a
23.4%share,upfrom23.1%in2011.
Crest,thesecondlargestbrandinthecategory,experiencessalesincreaseof4.8%in
2012withtheintroductionoftwonewproducts:CrestProHealthClinicalAntiPlaque
RinseandScopeOutlastmouthwash.
Crestsmarketshareincreasesfrom13.4%in2011to13.8%in2012.
ThenewCrest3DWhiteningrangeincludesArcticFreshRinseandGlamorousWhite
Rinse that help boost brand sales. Also, the cross marketing with the OralB
toothbrusheshelpsbroadenawarenessanddemandforthebrand.
Scopes sales increase 1.3% in 2012, benefiting from new branding and packaging in
2012,withsalesreaching$76millionin2012from$75millionin2011.
ScopeOutlastmouthwash,introducedin2012,booststhebrandssaleswithitsstrong
performance.
4A296
Procter&Gamble
Procter& Gamble is the thirdleading marketer in the fragrances for men category, with
salesincreasing6.7%,whichisahighergrowthratethanLOralorCoty.
Procter & Gamble owes its fragrance success to its two highend European fashion
houselicensesDolce&GabbanaandGucciincontrasttobothLOralandCotythat
alignwithmidtierfashionbrandsandcelebrities.
GucciGuiltyPourHommeisthethirdleadingmensfragrance,andcontinuestogrow,
up5%to$42millionin2012.
Dolce&GabbanastopscentsLightBluePourHommeisinfifthplace,whileTheOne
dropstoseventhplace,duetothelaunchofTheOneSportwhichobtains$11million
insalesinjustafewmonths.
In2012,Procter&GamblelaunchesitsfirstscentwithdesignerVinceCamuto.
The company also competes in the mass market with its lower end, but long
establishedOldSpice,theleadingmassbrand,andtheGilletteSeries,bothofwhich
are more aligned to shaving than fine fragrances, and both of which have a loyal
customerbase.
SalesofProcter&Gambleslidedowntomakeitthefifthleadingmarketerinthelipsticks
andlipglossescategory,withsalesof$103millionin2012,down9.6%from$114millionin
2011.
Themarketeraccountsfor7.5%ofthetotalcategoryssalesin2012,downfrom8.4%
in2011.
TheCovergirlbrand,thesecondleadingbrandinthecategory,istheonlybrandthat
Procter&GamblehasintheU.S.massmakeupmarket.
Manufacturers sales are estimated at $103million in 2012, down 9.6% from
$114millionin2011.
Covergirl competes in the lipsticks and lip glosses segments. The brand sees a large
dropinsalesamongitslipglossproducts.
Procter & Gamble is the secondlargest advertiser in the category, supporting its
Covergirl brand with $55million in 2012, down from $78.5million in TME in 2011.
Television advertising represents about 37% of the brands TME. The remainder is
spentonprintadvertising.
Inthedentureproductscategory,Procter&Gamblessalesdropby$5millionto$98million
in2012.
FixodentistheonlybrandmarketedbyProcter&Gambleinthecategory.
Thecompanystotalmarketsharedecreasesslightlyto30.8%in2012,from32.8%in
2011.
Procter& Gamble decreases its advertising and promotional support for its Fixodent
brandin2012,leadingtothesalesdecline.
Lack of new product activity also offsets the growth of the brand in the category in
2012.
Fixodent,thetopbrandinthedentureadhesivessegment,dropsby4.9%in2012to
$98million.
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Procter& Gamble continues to be the secondleading marketer in the shaving products

categoryin2012.
Manufacturerssalesreach$95millionin2012,up4.4%from$91millionin2011.
Thecompanysmarketshareincreasesto25.5%in2012,upfrom25.1%in2011dueto
therapidlyexpandingTheArtofShavingbrand.
Furthergrowthforthebrandisoffsetbyincreasingcompetitionfromotherbrandsin
Themarketerssecondleadingbrand,TheArtofShaving,witnessesagrowthof25.0%
to$10millionin2012,upfrom$8millionin2011.
SinceProcter&GamblesacquisitionofTheArtofShaving brandin2009,thebrand
hasbeenthefastestgrowingbrandforProcter&Gambleinthebeautyandgrooming
division.Thebrandsretailpresence,whichwasonceconfinedtodepartmentstores,
witnesses growing retail expansion to standalone stores, mass merchandisers, and
selectsalonsafteritsacquisitionbyProcter&Gamble.
Also, the number of The Art of Shaving stores has more than doubled since its
acquisitionwithmoststoreshavingabarbershopinsidethemtopampermenwitha
traditional shaving experience. The brand has its own retail stores in about 80
locationsacrosstheUnitedStates.
SalesofOldSpice,themarketersthirdbrandinthecategory,remainat$1millionin
Procter&GamblesOlayrecordsanenormousgrowthof375.0%inthedepilatories,waxes,
andbleachescategoryin2012.
Manufacturerssalesforthebrandadvancefrom$4millionin2011to$19millionin
2012.
Olays offering in the depilatories, waxes, and bleaches category consists of a single
product, the Smooth Finish Facial Hair Removal Duo. Currently, the Smooth Finish
FacialHairRemovalDuoisavailableintwovariants:oneforfinetomediumhairand
theotherformediumtocoarsehair.
TheSmoothFinishFacialHairRemovalDuoforMediumtoCoarseHairislaunchedin
2012 after the successof the initial launch of the Smooth Finish Facial Hair Removal
DuoforFinetoMediumHairin2011.
SalesforOlaybenefitfromastrongdistributionmodelanditsproductsareavailable
acrossallmajorretailmasschannels,suchasWalmart,Walgreens,andCVS/Pharmacy.
The brand has a higher price point than competing products, because of the trusted
Olayname.Thisalsocontributestothesteepdollarincreaseinsales.
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RECENTDEVELOPMENTS
In August 2012, Procter & Gamble files a complaint with the NAD (National Advertising
Division) in the United States against ColgatePalmolive regarding the usage of certain
claims for its Optic White range of oral care products. The NAD has ordered Colgate
Palmolive to stop advertising some claims for its whitening toothpastes including same
whiteningingredientasstrips.
Also in 2012, NAD states that Procter & Gamble uses Photoshop to digitally retouch
theimagesusedinitsprintadvertisementsandmakingsuperiorperformanceclaims
foritsproducts.
Mergers,acquisitions,anddivestures
InFebruary2012,thecompanyannouncesits$10billionproductivityandcostssavingplan
todecreasecostsinareassuchassupplychain,researchanddevelopment,marketing,and
overheadexpenses.
InMarch2012,Procter&GambleacquiresNewChapterInc.foranundisclosedsum.
NewChapterisaTexasbasedvitaminandsupplementcompany.
In May 2012, Procter& Gamble divests its snacks business to The Kellogg Company for
$2.7billion in an allcash transaction. The Kellogg Company is a multinational food
manufacturingcompanybasedinBattleCreek,MI.
As a result of this change, the Pet Care business is now included in the Fabric and
HomeCaresegment.
ThedivestituremarksProcter&Gamblesexitfromthefoodandbeveragebusiness.
Managementchanges
Therearenomanagementchangesin2012.
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NOTABLENEWPRODUCTS
Table5158:SelectNewProductsIntroducedbyProcter&GambleintheUnitedStatesin2012
Brand
Category
Description
Covergirl
Facemakeup
Covergirl&OlayPressedPowder
Covergirl
Lipsticksandlip
glosses
BlastFlipstickBlendableLipDuo
Covergirl
Nailpolishes
CovergirlOutlastStayBrilliantNailGloss
Crest
Toothpastes
CrestProHealthClinicalPlaqueControltoothpastehasaformula
thatprotectsteethagainstplaque,gingivitis,cavities,andtooth
sensitivity.Thistriclosanfreetoothpastealsohelpswhitenteeth
andpreventsplaquefromreoccurring
Crest
Toothpastes
CrestCompleteMultiBenefitExtraWhite+ScopeOutlastLasting
Minttoothpastewhitensteethbyremovingsurfacestainsand
helpsprotectagainstcavitiesandtartars
Crest
Toothpastes
Crest3DWhiteAdvancedVividEnamelRenewaltoothpaste,an
anticavitytoothpastewithsodiumfluorideasitsactive
ingredient.Theproductisforpeopleagedoversixyears
Crest
Toothpastes
CrestProHealthClinicalGumProtectionInvigoratingCleanMint
toothpaste,ifusedformorethanfourweekshelpsreverse
gingivitisandimprovegumhealth.Italsoprotectsfromteeth
sensitivity,cavities,plaque,andbadbreath
Crest
Toothpastes
TheCrest3DWhiteGlamorousWhitetoothpasteismadewitha
formulathatremovessurfacestainsandsurroundsteethwith
teethwhiteningagentstobrightenthem
Crest
Toothwhitening
products
Crest3DWhiteIntensiveProfessionalEffectsWhitestripsusesa
shinetechnologythatclaimstoremoveupto90%ofsurface
stainsinfivedays
Mouthwashes
Crest3DWhiteArcticFreshIcyCoolMintOralRinseisinfused
withatripleactionformulathatwhitensteethbyremoving
surfacestains,helpsprotectagainsttheformationofnewstains,
andfreshensbreath
Mouthwashes
CrestProHealthClinicalAntiplaquerinse,offersprotectionfrom
plaqueandgingivitis,clinicallyproventoreduceplaqueandhelp
preventplaqueregrowth,andclinicallyproventohelpprevent
andreversegingivitis
Fragrancesformen
TheOnefranchiseisextendedwithTheOneSport,thethird
fragranceintheline.Thisislighterandfresherthantheother
scentsinthefranchiseandopenswithaquaticnotesand
rosemaryalongwithcardamomandsequoiawood
Crest
Crest
Dolce&Gabbana
(Continued)
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Procter&Gamble
Brand
Category
Description
Gillette
Personalcleansing
products
OdorShieldAllDayCleanBodyWashisformulatedtofightodor
andwetnessinadditiontothebasiccleansingfunction
Gillette
Shavingproducts
FusionProGlideClearShaveGelisanonfoamingshavegelwitha
masculinefragrance
Gucci
Fragrancesfor
women
GucciPremiereissaidtobeinspiredbygownsfromtheGucci
Premierecouturecollectionwithtopnotesofbergamotand
orangeblossom
Head&Shoulders
Conditioners
DamageRescueconditionernourishesdamagedhairandrelieves
dryscalpbylockinginmoisturetherebymaintainingahealthy
moisturebarrier
Head&Shoulders
Shampoos
DamageRescueDandruffshampoonourishesdamagedhairand
helpsrelievedryscalp
Head&Shoulders
Shampoos
TheClinicalStrengthAntidandruffshampoohelpsprevent
itching,scaling,irritation,andrednessassociatedwithseborrheic
dermatitisanddandruff
HerbalEssences
Shampoos
TheHoneyImStrongshampooisinfusedwithhoney
Olay
Depilatories,waxes,
andbleaches
SmoothFinishFacialHairRemovalDuoMediumtoCoarseHairis
agentletwostepsystemthatremovesunwantedfacialhair,the
skinguardingbalmactsasaprotectivebarrieragainstthedirect
contactofthehairremovalcream,whilethecreamremoves
unwantedhair
Olay
Facialtreatments
ProXSpotFightingTreatmentissaidtoreducethelookofdark
spotswithhydrationtoimproveoverallskinforamoreeventone
andmicroexfoliationtoremovedullnessforbrighterskin
Facialtreatments
TotalEffectsCCToneCorrectingLinetreatssevensignsofaging,
whileprovidingimmediatecolorcorrectionwithtintedformulas
thatincludeUVprotectionortonecorrectionovertime.The
multipleinstantandlongtermbenefitsclaimtoleaveskineven
tonedwiththereducedappearanceofdiscolorations,finelines,
andwrinkles
Olay
Facialtreatments
RegeneristMicroSculptingCreamReformulationclaimsto
reverse10yearsofwrinklesinfourweeks.Helpsaccelerateskin
turnover
OralB
Toothbrushes
OralBextendsitsProHealthforMelinewithaSensitiveClean
rechargeablepowertoothbrushthatprovidesagentlebrushing
experiencetokids
OralB
Toothbrushes
OralBadvantagePlustoothbrush,withouterangledbristlesthat
massage,stimulate,andcleansgumlineeffectivelyforwhiter
teeth
Pantene
Ethnichaircare
products
TrulyNaturalshampooprovidesmoisture,shine,andhealthto
eachhairstrand
Olay
(Continued)
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Brand
Category
Description
Pantene
Ethnichaircare
products
TrulyNaturalconditioneraddsmoistureandhealthtoeachhair
strand
Pantene
Ethnichaircare
products
TrulyNaturalShineSerumaddsmoisturetohairanditskey
ingredientarganoiladdslonglastingshine
PanteneProV
Conditioners
PanteneProV
Conditioners
PanteneProV
Conditioners
PanteneProV
Shampoos
PanteneProV
Shampoos
PanteneProV
Shampoos
Scope
Mouthwashes
Secret
Deodorantsand
antiperspirants
VinceCamuto
Fragrancesformen
PanteneAdvancedandKeratinRepairconditionerfeatures
advancedtechnologytohelprestoresmoothnesstoextremely
damagedhair,whilepreventingfurtherdamage
ProVMoistureRenewalconditionerisspeciallyformulatedto
nurturethehairslipidlayerensuringmaximummoisture
retentioninanaturalandhealthyway
ProVBeautifulLengthsconditionerfortifieshairagainstdamage
thatleadstobreakage,therebyincreasingthelengthofeachhair
strand
PanteneAdvancedandKeratinRepairshampoofeatureadvanced
technologytohelprestoresmoothnessofextremelydamaged
hair,whilepreventingfurtherdamageatthekeratinlevel
TheDailyMoistureRenewalshampoocleansandprovidesanall
daymoisturizationtothehair
PanteneAgeDefyshampooclaimstohelphairactupto10years
youngerbythickeningexistinghairstrands
Outlastmouthwashinfusedwithoutlasttechnologythatbinds
tightlytoselectreceptorsinthemouth,creatingacool,refreshing
sensationthatlastslonger
SecretOutlastwithDualActionOdorTechnologyprovides
freshnessthatlastsupto48hours.Italsominimizesodorcausing
bacteriaandisavailableinInvisibleSolid,ClearGel,andsmooth
Solid
Inablackbottlewiththefamilycrest,thisfragranceopenswith
Italianbergamot,mandarin,andblackpepper
MARKETINGACTIVITY
Procter&GamblesupportsitsbrandswithahugeTMEof$1,216.6millionin2012,down
17.8% from $1,489.8million in 2011. The advertising expenditure is a good mix of media
andcrosschannelpromotionalstrategies.
The majority of Procter & Gambles advertising expenditures are attributed towards
magazineadvertisements,accountingfor50.8%ofthemarketerstotalTMEin2012.
Televisionadvertisementsrepresent42.0%ofthecompanystotalmediasupport.
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Procter&Gamble
Procter&Gambleutilizesdifferentmarketingmediatopromoteitsproductsforitsvarious
portfoliosofbrands.
The company continues to engage celebrities to endorse its brands and line of
products for print and television advertisements. The celebrities engaged by the
marketerincludepopularfilmandtelevisionpersonalities,models,andsportspersons
andathletes.
Increasingly,themarketerisutilizingnontraditionalmediasuchastheInternet,social
media sites, and mobile phones to advertise its product lines. Such media is used in
addition to the traditional advertising in order to reach out to a wider section of
consumers.
In2012,Procter&GamblesTMEinthehaircareproductclassamountsto$242.3million.
Procter&GamblesTMEintheshampooscategoryfor2012is$156.3million,downby
0.5%,from$157.1millionin2011.
ThePanteneProVbrandgarners$82.2millionoftheTMEin2012.ThePanteneProV
MoistureRenewallineisallocatedaTMEof$33.5millionin2012.
TheantidandruffbrandHead&Shouldersgarners$60.2millionoftheTME.
Procter&Gamblesmediaspendonthehaircoloringcategoryin2012is$55.7million,
downsignificantlyby32.2%from$82.3millionin2011.
The company spends approximately 59.6%, or $33.2million, on television
advertisementsfollowedbymagazineadvertisementswith$21.7million.
NiceNEasyhairfoamgarnersalionsshareoftheTMEat$20.4million.
TheClairolNaturalInstinctslineissupportedwith$13.0million.
Procter&Gambleisthethirdleadingadvertiserinthehairstylingproductsandsprays
category. The marketer drops its TME significantly by 50.0%, from $55.4million in
Procter & Gamble allocates $13.7million or 49.4% of its TME through television
advertisements, followed by $11.7million or 42.2% of its TME through magazine
advertisements.
PanteneProVlinereceivesatotalTMEsupportofapproximately$10.1millionin2012,
spreadprimarilyacrosstelevisionandmagazineadvertising.TheTMEsupportforthe
branddecreasesby70.8%in2012from$34.6millionin2011.
Procter&Gamblespends$53.7millionpromotingitsCresttoothwhiteningproducts
Procter& Gamble, thesecondleading marketer in the conditioners category, spends
$2.6millionin2012,adeclineby51.9%from$5.4millionin2011.
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Procter&GamblesTMEintheoralcareproductclassamountsto$185.8millionin2012.
ThemarketerdecreasesitsTMEsignificantlyby39.5%from$143.9millionin2011to
$87.0millioninthetoothpastescategoryin2012.
Procter & Gamble also decreases its couponing and discounting activity in 2012. For
example, in 2011, Procter & Gamble offered coupons worth $3.00, but in 2012 the
marketerofferscouponsworth$1.00only,andforaverylimitedperiod.
Procter& Gamble spends $53.7million to promote Crest tooth whitening products
Procter & Gamble is the secondlargest advertiser for mouthwashes, spending
$22.0millionin2012.
TMEaredividedprimarilybetweentwobrandsCrestProHealthandScopebothof
whichhavenewproductlaunchesin2012.
Procter & Gamble allocates approximately $17.2million to promote its Crest Pro
Healthbrand,andtheremaining$4.8millionisallocatedtotheScopebrand.
Advertising spend is primarily allocated to magazines and television commercials in
2012.Thecompanyallocates$18.0millionontelevisionadvertisingand$1.3millionof
itsTMEonmagazineadvertisements.
Procter&Gambleistheleadingadvertiserinthetoothbrushescategoryin2012with
$21.6millionspentinTME,upfrom$18.3millionin2011.
Approximately $21million in TME is allocated to OralB regular toothbrushes and
$0.8millioninTMEisallocatedtoOralBbatterytoothbrushes.
Procter& Gamble promotes its toothbrushes with about 54.6% of its TME on
television advertisements, followed by 38.9% on Internet promotions, and 6.0% on
magazines.
Procter& Gamble ranks third in TME in 2012, allocating $1.5million in TME to
Fixodentinthedenturesproductscategory.
Television advertisements remain the most preferred promotional method for the
Procter&Gambles2012advertisingspendisalmost77%lowerthanits2011TMEof
$6.5million.
Virtually all of the marketing budget is spent on television advertisements and
syndicatedpromotions.
Themarketeralsooffersdiscountcouponsof$1.00onitsFixodentbrand.
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Procter&Gamble
Procter&GamblesTMEintheothertoiletriesproductclassis$116millionin2012.
ThemarketersTMEinthedeodorantsandantiperspirantscategorydeclines20.5%in
2012to$69.9million,from$88.0millionin2011.
Malecentric brands continue to associate themselves with popular sports
personalities and sports. Procter & Gambles Gillette launches My City is My Gym
campaign that urges men to put to test its Gillette Odor Shield
antiperspirant/deodorant by taking their exercise regime outdoors. The company
partners with three professional athletes hockey player Patrick Sharp; former
footballstarDhaniJones;andfootballlegendJerryRicetopromoteitsGillettebrand.
Procter&Gamblecontinuestobethesecondleadingadvertiserinthedeodorantsand
antiperspirantscategoryin2012.
ThemarketersTMEin2012amountsto$69.9million,down20.5%from$88.0million
in2011.
Secret, the marketers leading brand, receives TME support of $41.7million in 2012.
Thisisanincreaseof4.5%from$39.9millionin2011.
The Secret Outlast Collection receives the maximum TME among the Secret line of
productswithexpendituresat$22.5millionin2012.
Televisionisthemostpreferredadvertisingmediumadoptedbythebrand.Television
advertisementsaccountfor61.7%ofthetotalTME.
Thesecondleadingadvertisingmediumforthemarketerismagazineadvertisements,
accountingfor22.6%ofthetotalTME.
In2012,Procter&GamblereducesitsadvertisingexpenditureonInternetadvertising
to$10.2millionin2012,down43.0%from$17.9millionin2011.
ThecompanypartnerswithJenniPulos,atelevisionpersonality,actress,rapper,and
executiveassistant,topromoteitslatestlineofproducts,theSecretOutlastCollection.
In2012,Procter&GamblesetsuptheGangUpforGoodhubatmeanstinks.comin
the honor of the National Bullying Prevention Month. The website offers an advice
section, whereby girls all over the country share their experiences, encourage other
girls,andprovideexamplesofhowtheyhavesuccessfullyGangedUpForGood.
InthesecondyearoftheMeanStinksprogram,thebrandpartnerswithmusicartist
DemiLovatoandencouragesgirlstobeapartofthemovementthatattemptstobring
an end to mean behavior. The girls participating in this program are expected to
promote the Mean Stinks pinky swears by painting their nails blue to support peace
andsolidarity.
ThecompanypromotesitsOldSpicebrandwithamusicalhitMuscleMusic,avideo
whichfeaturesTerryCrews,aformerNFLplayer.Whenthevideofinishes,viewerscan
develop their own music by moving Crews muscles using the keyboard. Each key
strokeflexesamuscleonCrewsbodytohitaninstrument.
Procter & Gamble is the leading marketer in TMEs in the depilatories, waxes, and
bleachescategory,withadvertisingexpendituresat$30.1millionin2012.
The marketer entered the category in 2011 with Olays Smooth Finish Facial Hair
RemovalDuo.
Procter&Gamblespends$15.8milliononmagazineadvertisementsand$12.9million
ontelevisionadvertisements.
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Olayspresenceonsocialmedianetworks,suchasFacebook,helpsspreadawareness
aboutitsproductsthatcompeteinthedepilatories,waxes,andbleachescategory.
OlayswebsitealsopromotestheSmoothFinishFacialHairRemovalDuobyeducating
consumersabouthairremovalfactsandmythsandbyprovidingvideosandarticlesby
professionalestheticians.
Consumersinterestedinreceivingregularupdatesaboutthebrandsactivitiesinthe
form of special offers, events, sweepstakes, giveaways, and insider information can
jointheOlayClubthroughthebrandswebsite.
Procter & Gamble slides to become the secondleading advertiser in the personal
cleansingproductscategorywithaTMEallocationof$11.6millionin2012.
The marketers TME declines 70.0% from $114.1million in 2011, to $40.0million in
2012.
The company apportions $10.6million or 91.4% of the marketers total TME on
In2012,Procter&GambleintroducestheMyCityisMyGymcampaigntopromote
its Gillette brand. The campaign encourages men to take their exercise routine
outdoorsandcleansethemselveswithGillettesOdorShieldBodyWash.Themarketer
claimsthatthisbodywasheliminatesodorinsteadofmaskingit.Gillettepartnerswith
three professional athletes hockey player Patrick Sharp, Dhani Jones, a former
footballstar,andJerryRice,afootballlegendtopromoteitsproducts.
Olays website promotes its personal cleansing products by informing consumers
about the various offers and providing details on ways to attain the companys
productsatlowerprices.Olayalsoprovidesfreeshippingonpurchasesabove$25.00.
Procter&Gamblespends$4.4millionasTMEtopromoteitsbrandscompetinginthe
shavingproductscategoryin2012,up10.0%from$4millionin2011.
Gillettepartnerswith25ambassadorsworldwideforitsGetStartedcampaign.
Thecampaignhelpsitsambassadorstogivebacktotheirrespectiveorganizationsand
communities,whichgroomedthemtotheircurrentpositioninlife.
GilletteandRyanLochte,worldchampionswimmer,donate$25,000toDaytonaBeach
Speed Swimming the swimming club that helped give Lochte a start to his
swimmingcareer.
Gillette also partners with sport personalities, such as Tyson Gay (USA, track), Roger
Federer(Switzerland,tennis),andSirChrisHoy(GreatBritain,cycling).
TheArtofShavingbrandteamsupwithMovember,aglobalmenshealthcharity,to
fightcancerthataffectsmen.
Theparticipantsraiseawarenessandfundsformenshealth,especiallyprostateand
testicularcancer.
The Art of Shaving encourages people to participate in Movember's 6th annual U.S.
fundraising event. The brand urges members of their "brotherhood of shaving" to
participateintheeventbyassuringtomatchtheteamdonationsupto$25,000.
In 2012, The Art of Shaving invites all registered MoBros to a complimentary
MovemberHotTowelShaveavailableatthebrand'sBarberSpalocations.
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Procter&Gamble
In2012,theadvertisingexpendituresforProcter&Gamblearerecordedat$221.4million
inthefacemakeupcategory.
Procter&GamblesTMEinthefacemakeupcategoryis$87.1million in2012,down
8%from$95millionin2011.
Covergirl uses its website to help consumers match foundation shades. Visitors can
chooseadepartmentstorebrandandthesitewillprovidetheCovergirlproductthat
matchesthatproduct.Procter&Gambleusesseveralmediapersonalitiestopromote
itsCovergirlbrand.ThelatestspokespersonsincludesingersJanelleMonaeandPink.
Procter&Gamble,thesecondlargestadvertiserintheeyemakeupcategorywithonly
itsCovergirlbrand,hasadvertisingexpendituresof$74.2millionin2012,downfrom
TheadvertisingcampaignforCovergirlusesactressSofiaVergaraforitsLashBlast24
hrmascaraandforitsnewBlastFlipsticklipstick.CovergirlalsousessingerTaylorSwift
for its Lash Blast Volume mascara and for its Eye Enhancers and Perfect Point Plus
Linerproducts.
Thelipsticksandlipglossescategoryreceives$57.1millioninadvertisingexpenditures
fromProcter&Gamble.
In 2012, Head & Shoulders signs on Argentinian soccer player, Lionel Messi, as an
ambassador for a series of advertisements that are specifically designed for the U.S.
Hispanicmaleaudience.
LionelMessiwillhelppromotetheRefreshforMenlineofproductsthroughtelevision
andonlineadvertisements.
Additionally, Messis fans are able to access statistics and photos of the threetime
FIFAworldplayerthroughthenewlyredesignedFacebooktab,www.HombreMVP.com.
Procter&Gambleistheworldwidepartnerforthe2012LondonOlympicsheldatLondon,
England.
Thecompanysponsors28U.S.OlympicandParalympichopefulsforthe2012London
OlympicsandParalympicGames.
Theseathletesrepresent13ofProcter&Gamblesiconicbrands.
The marketer also announces the launch of the Procter & Gamble Team USA Youth
SportsFundwhichaimsatraising$500,000throughthe2012LondonOlympics.
The fund will aim to aid mothers in raising happy and healthy kids by giving them
broader access to youth sports as a part of Procter & Gambles Thank you, Mom
campaign.Thisisapartofthecompanysglobalefforttoraisemorethan$5millionfor
youthsports.
The marketer, in conjunction with the Olympic and Paralympic athletes, encourages
consumerstohelpthecausebyvisitingtheThankyou,MomFacebookpagetoshow
theirsupportandsharetheirstories.
Furthermore, Procter & Gamble donates $1.00 up to $100,000 to the Procter &
GambleTeamUSAYouthSportsFundforeverylikeonProcter&GamblesThank
you,MomFacebookpage.
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TheSuperBowl,apopularsportingeventintheUnitedStates,attractsmillionsofviewers
everyyear.
Onthisday,sportsenthusiastsnotonlywatchthematchwithenthusiasmbutalsothe
advertisements. The company uses this opportunity to premier its latest and most
entertainingadvertisements.
OUTLOOK
Procter&GambleislikelytoremaintheleadingmarketerintheU.S.personalcaremarket
throughtheforecastperiod,eventhough2012hasproventobeoneofitsmostchallenging
yearstodate.
Procter & Gamble, despite a disappointing financial performance in 2012 in the U.S.
personal care market, one of its largest revenue generating regions, the marketer is
expectedtohaveabrightfuturethrough2017.
Procter & Gamble, with its portfolio combining performing and underperforming
brands,hasprominenceinmostproductcategories.
The companys focus will continue to be on the development of its core leadership
brandsandcategories.
The company is taking initiatives to focus on its longterm strategies to increase its
financialstability,eventhoughsomeoftheseactionshavehurtsitsU.S.sales.
The company has implemented three changes including strengthening its core
business,renewingfocusondiscontinuousinnovation,andstartinga$10billioncost
savingprogram.
Therestructuringandfocusonstrongbrandsstrategyimpliesthecompanysshiftfrom
premiumpriced products to a more competitive pricing structure, a strategy that
manyconsumersinthedevelopedmarketsfavorduetotheircompromisedspending
power.
Furthermore,thecompanytakesstepstoimprovetheexecutionacrossthecompany
to overcome macro challenges, manage competitive threats, and attain maximum
benefitsfrominnovation,marketing,andproductivityprograms.
However, the companys growth in the U.S. market will be hampered by the
marketersfocusondevelopingbusinessintheemergingmarkets.
Additionally, Procter & Gamble suffers due to its division of resources among many
diverse categories, whereas its competitors such as LOral and Unilever are at an
advantage, due to their concentration in the beauty and personal care categories
respectively.
Thereareseveralfactorsfavoringthemarketersgrowthoverthenextfiveyears.
The consolidating industry where big companies continue to acquire brands from
smallercompanies,therebycontrollingtheindustry.
The companys new fourpoint plan for innovation which has been designed to help
shape themarketersbusiness especially during challenging economic conditions will
4A308
Procter&Gamble
help the company improve its position in the market. According to the fourpoint
innovationplan,innovationmustbebalanced,communicatevalue,concernallofthe
companysemployees,andconnectwithconsumers.
Procter & Gamble is expected to emphasize on technologically advanced product
formulationsandpackaging.
In the past traditional media has been instrumental in using up the companys
advertisingbudgettoagreatdeal.However,withplansofarevisioninitsmultibillion
dollar advertising budget, the company is expected to use Facebook and Google to
becomemorecosteffective.
The companys partnership with wellknown celebrities for its larger wellknown
brands such as Olay, Covergirl, Gillette, Old Spice, Crest, and Oral B is expected to
increasesalesandthevisibilityofitsbrandsduringtheforecastperiod.
Procter & Gamble will continue to expand its presence into varied channels such as
specialtystores,perfumeries,pharmacies,salons,andecommerce.
In 2012, Procter & Gamble forms a global pledge to invest its resources for the
development of plantbased poly ethylene terephthalate (PET) to be used in the
packagingofitspersonalcareproducts.PET hasanenlargedcarbonfootprintasthe
materialisproducedwithlargeamountsoffossilfuels.Sustainablepracticessuchas
thiswillbecomemoreimportanttoconsumersovertheforecastperiod.
Procter & Gambles beauty business in the U.S. market is geared towards the mass
segment,howeverinthecomingyears,itisanticipatedthatthemarketerwillgrowits
presenceinthepremiumsegmentbeginningwiththeemphasisonitsmasstigebrand,
Olay.
ThefactorscausingProcter&GambletolosegroundintheUnitedStatesin2012willneed
tobereversed,forthecompanytoregainitsfootingintheforecastperiod.
The companys $10 billion costsaving plan announced in February 2012 has left
some of its brands lacking necessary marketing support, particularly in light of its
competitorsincreasingtheirownpromotionalactivities.Thecompanyplanstoreduce
costsbycutting$6billionincostofgoodssold,$3billioninoverhead,and$1billionin
marketing.
Thecompanyisalsolikelytocut1,600jobsasacostcuttingexerciseinthefiveyear
forecastperiod.
The costcutting exercise will work in conjunction with companys new advertising
strategythatisaimedatloweringthecompanysadvertisingexpenditures.
Limited innovations from Procter & Gamble are also responsible for the companys
weakgrowthin2012,whichresultsfromcostcuttinginR&D.
Procter & Gambles current plight dramatically exemplifies how critical both
innovationandpropermarketingsupportaretobesuccessfulinthebeautyindustry.
5309
5310
Procter&Gamble
Procter&GamblehaslostouttoitsmajorcompetitorsintheUnitedStatesin2012.
Competition from big marketers such as Unilever, ColgatePalmolive, and Johnson &
Johnson has gradually eroded Procter & Gambles market share in the skin care and
haircareproductclass.
In2012,Procter&Gamblehasstruggledtomatchupwithitscompetitorsinvolume
growth,asthecompanyshigherpricepositionmakesitvulnerable.Itincreasesprices
of products to recover commodity costs, a move many of its competitors did not
undertake.
Thecompanyspresenceinboththeretailandsalonprofessionalchannelswillhelpthehair
careproductclasstocontinuetobethelargestproductclassforthecompanyduringthe
forecastperiod.
ShampoosandconditionersarelikelytoemergestrongerforProcter&Gambleduring
theforecastperiod.Thecompanysresearchprogramintothehairagingprocessthat
hasresultedinthenewhaircarelinecomprisingashampoo,conditioner,masque,and
thickeningtreatment,tofightthesevensignsofhairfollicledeteriorationisexpected
to be well received by the consumers thereby driving up the sales for the company
through the forecast period. Procter & Gamble claims that its AgeDefy product is
expectedtomakethehairlook10yearsyoungerforwomenintheir40s.
With Pantene losing ground, the companys own Head & Shoulders is capturing its
place. By focusing on problemsolving products, Procter & Gamble is expected to
regainlostground.
SalesofHerbalEssenceswillcontinuetogainfromitsemphasisonproductscontaining
naturalingredients.Newproductactivityfromthebrandin2012includesarangeof
conditioners including Honey Im Strong conditioner and Long Term Relationship
naturalconditioner.
Thesuccessoffoambasedhaircoloringproductswillsupportthecompanysgrowthin
thehaircareproductclass.
Procter & Gamble is expected to try to revive growth in the hair coloring products
category with active new product introductions after the discontinuation of six hair
coloringproductlinesin2011.
The companys presence in the professional trade class through its Sebastian and
Nioxinbrandsisexpectedtostrengthenduringtheforecastperiod,ending2017.Ifit
renewsmarketinginitiativestoreviveSebastian,itcanonceagainbeamuchsought
afterbrand.Nioxinwillsucceedbecauseofitsstrongclinicalpositioningandsolution
forhairlossproblems.
4A310
Procter&Gamble
In the other toiletries product class, Procter & Gamble is likely to post a healthy growth
through2017.
In the deodorants and antiperspirants category, Procter & Gamble is expected to
introduce a range of products targeted towards women in order to compete with
othermarketerssuchasColgatePalmolive,Unilever,andRevlon,whoofferseparate
deodorantandantiperspirantproductlinesformenandwomen.Procter&Gambleis
expected to introduce naturallyformulated shaving gels and creams thereby
commandinghigherpricesforsuchproducts.
Olayisexpectedtoperformwellinthedepilatories,waxes,andbleachescategorywith
thelaunchofmorevariantstoits existinglineofproducts.Thereisalikelihoodthat
thebrandwillventureintoothersegments,suchaswaxesandbleachesinanattempt
tocompetewithotherbrandsinthecategoryandtryandcapturegoodmarketshare.
The marketer will continue to provide good marketing support to its new product
introductions with print and television advertisements as the main mediums. Also,
Olaywillsignacelebritytoendorseitsproductsinthecategory,whichwouldsolidify
itsdominance.
Procter & Gamble is poised to take advantage from the opportunities arising from the
growingmalegroomingsegment.
Procter&GambleemphasizesthiswithitsmaleorientedbrandssuchasGilletteand
The Art of Shaving brands, which span various sales channels and appeal to a wide
rangeofconsumers.
Gillette is expected to maintain its longstanding leadership position in the shaving
productscategory.Thebrandbenefitsfromitsdominantglobalpresenceintherazors
category.
The Art of Shaving, a premium mens grooming brand, is likely to continue its
expansionthrough2017.
Bytheendof2012,TheArtofShavingbrandispresentin67retaillocationsincluding
retailerssuchasNordstrom,BloomingdalesNeimanMarcus,BarneysNewYork,Saks
FifthAvenue,HoltRenfrew,andMacys.
The company is planning to strengthen its mens product line as more interest is
generatedamongitsyoungandoldmalecustomers.
As the trend towards naturallypositioned products continues to gather momentum, the

marketer is likely to introduce products enriched with increased concentration of natural
ingredients.
Naturallyformulated products gain acceptance as consumers increasingly become
health conscious and try and incorporate the trend of health and wellness in their
personalhygieneregimen.
These naturallyformulated products contain lower levels of synthetic ingredients as
comparedtotheconventionalproductsavailableinthemarket.
5311
5312
Procter&Gamble
The prestige fragrance category, backed by big brand names such as Gucci, Dolce &
Gabbana,andHugoBosswillcontinuetodowellduringtheforecastperiod.
Procter&GamblessalesintheU.S.cosmeticsandtoiletriesmarketareforecasttoreach
$6,317millionby2017,upataCAGRof1.4%from$5,883millionin2012.
Table5159:ForecastDollarSalesgrowthofCosmeticsandToiletries
forProcter&GamblebyProductCategory,2012to2017
Productcategory
CAGR,%
13.0
10.2
Nailpolishes
8.4
Fragrancesformen
3.7
Shampoos
3.6
Conditioners
3.0
Shavingproducts
3.0
Mouthwashes
1.6
COMPANYAVERAGE
1.4
Toothpastes
1.3
Facialtreatments
1.2
Fragrancesforwomen
1.2
1.1
Handandbodylotions
1.0
Toothbrushes
1.0
0.9
0.9
0.8
Eyemakeupproducts
0.7
Facemakeupproducts
0.7
0.7
0.6
Dentureproducts
4A312
REVLON
Table5160:RevlonsSalesofCosmeticsandToiletriesintheUnited
States,2011and2012
$Million
Category/brand
2011
EYEMAKEUP
2012
Revlon
133
133
Almay
74
71
Total
207
204
Revlon
107
105
Almay
59
58
Total
166
163
130
135
12
12
147
152
125
123
129
126
FACEMAKEUP
Colorsilk
Frost&Glow
Allother
Total
Revlon
Bari/BonBons/LoveMyLips
Total
NAILPOLISHES
Revlon
38
48
Sinful
26
34
PureIce
22
25
90
108
Bari/BonBons
Totalr
(Continued)
5314
Revlon
Table5160:RevlonsSalesofCosmeticsandToiletriesintheUnited
States,2011and2012
$Million
Category/brand
2011
2012
LadyMitchumr
35
33
Mitchumr
17
19
Totalr
52
52
JeanNat
Charlie
Ciara
Total
FRAGRANCESFORWOMEN
FACIALTREATMENTS
Almay
TOTALr
802
814
rRestated.
NOTE:Allothersalesincludethesalesofsmallerbrandsthatthe
companyowns.
COMPANYOVERVIEW
Revlon,foundedbyCharlesRevson,isheadquarteredinNewYork,NY.
ThecompanyisthemajorityownedsubsidiaryofMacAndrewsandForbesHoldings.
Revlon manufactures, markets, and sells a variety of color cosmetics, fragrances,
personalcareproducts,andbeautytools.
Revlons products are sold worldwide in more than 100 countries and are marketed
underthebrandnamesRevlonandAlmay.
TheU.S.marketcontributestoapproximately56%ofthecompanysrevenues.
Thecompanycelebratesits80thanniversaryin2012.
As of December 31, 2012, the company has a worldwide workforce of about 5,100
employees.
Revlonsproductsaresoldinmorethan100countriesacrosssixcontinents.
Its products are sold through prestige and department stores, television shopping
networks,directsaleschannels,specialtystores,theInternet,perfumeries,andother
distributionoutlets.
4A314
Revlon
Globally,Revlonsmainavenuesofdistributionaremassmerchandisers,chaindrugstores,
andfoodstores.
Some of its major retailers are CVS, Target, Shoppers Drug Mart, A.S. Watson, and
Boots.
Walmart is Revlons singlelargest retailer, accounting for approximately 22.0% of its
salesin2012.
RevlonsproductsarealsosoldtotheU.S.militaryexchangesandcommissaries.
ThecompanyhasmanufacturingandwarehousingfacilitiesintheUnitedStates,Venezuela,
SouthAfrica,andMexico.
Product manufacturing is also outsourced by the company to thirdparty
manufacturersaroundtheworld.
AsapartofitsSeptember2012program,Revlonclosesitsmanufacturingfacilityin
FranceandMarylandandrestructuresitsFrenchandItalianestablishments.
The restructuring program, that includes cutdown of 250 positions, costs nearly
$24milliontothecompany.
Revlon records a 3.2% increase in sales to reach $1,426.1million in 2012, up from

Revlonsprofitsfurtherdeclineby4.3%to$51.1millionin2012,from$53.4millionin
2011.Netprofitsdeclineduetotheincreaseinthecostofsales,restructuringcharges,
andlossonearlyextinguishmentofdebt.
Since 2007, corporate sales have increased at a compound annual growth rate (CAGR) of
0.9%.
Table5161:RevlonsGlobalCorporateSales,2007to2012
$Million
Year
Sales
Netprofit/loss
2007
1,367.1
(16.1)
2008
1,346.8
57.9
2009
1,295.9
48.8
2010
1,321.4
327.3
2011
1,381.4
53.4
2012
1,426.1
51.1
TheUnitedStatescontinuestobeastablemarket,contributingto56.1%ofthecompanys
overallsalesin2012.
TheAsiaPacificregion,whichhascloseto16.8%shareofthenetsales,records2.4%
growthin2012.
Overall,thenetsalesincreaseduetoanincreaseinthesalesofRevloncolorcosmetics:
RevlonColorSilkhaircolorandSinfulColorscolorcosmetics.
5315
5316
Revlon
Table5162:RevlonsGlobalCorporateSalesbyGeographicArea,2011and2012
$Million
Geographicarea
2011
2012
UnitedStates
757.4
799.8
5.6
AsiaPacific
233.4
238.9
2.4
Europe,MiddleEast,andAfrica
208.7
184.4
(11.6)
LatinAmericaandCanada
181.9
203.0
11.6
1,381.4
1,426.1
3.2
Total
Change,%
Total sales for Revlons cosmetics and toiletries are up 1.5% to $814million in 2012 from
$802millionin2011.
Table5163:RevlonsCosmeticsandToiletriesSalesinthe
Year
$Million
Change,%
2007
758
2008
759
0.1
2009
752
(0.9)
2010
768
2.1
2011
802
4.4
2012
814
1.5
Makeupproductscontributeto73.8%ofthecompanystotalsalesin2012.
Salesintheproductclassgrowfrom$592millionin2011to$601millionin2012.
4A316
Revlon
Revlonslargestcategory,eyemakeup,accountsfor25.1%ofthecompanystotalcosmetics
andtoiletriessalesintheUnitedStates.
RevlonisthefourthleadingeyemakeupmarketerintheoverallU.S.marketin2012,
with7.5%ofcategorysalesin2012,downfrom7.9%in2011.
The companys sales decline 1.4% to $204million, down from $207million in 2011,
mainlyduetoitsflagshipbrand,Revlon.
ThemarketershrinksitsTMEfrom$52.2millionin2011to$31.5millionin2012.
TheRevlonbrandssalesare$133millionin2012,flatfrom2011.
Revlonsbestperformingsegmentiseyeshadowsin2012.
TME to support the eye shadow business is approximately $8million in 2012. The
mascarabusinessissupportedwithapproximately$9.5millioninTMEin2012.
Almayssalesdecline4.1%from2011withsalesof$71millionin2012.
Almayissupportedwith$11.6millioninTMEforitseyeshadowsegment,inparticular,
products within the Intense IColor franchise, and, $1.8million in TME is used to
supportitsAlmayOneCoatGetUp&Growmascara.
Withsalesof$163millionin2012,facemakeupaccountsfor20.0%ofthecompanystotal
sales.
Categoryssalesdeclineby1.8%,from$166millionin2011.
ThecategorystwomainbrandsareAlmayandRevlon.
Revlonisthesixthleadingmarketerinthefacemakeupcategory.
TheRevlonbrandssalesareestimatedat$105millionin2012,down1.9%from2011.
RevlonalsocompetesinthemassmarketwithitsAlmaybrand.
Almays sales decline from $59million in 2011 to $58million in 2012. Almays sales
declineacrossallcategoriesin2012.
TMEdecreases13%to$44.9millionin2012forboththeRevlonandtheAlmaybrands.
Justover$14millionoftheTMEisusedtopromoteAlmaysSmartShadeandWakeUp
foundations. The Revlon brands TME promotes its Colorstay Foundations (whipped
andliquid),AgeDefyingwithDNAAdvantagefoundation,andPhotoreadyfoundations
(whippedandliquid).
Hair coloring products is Revlons thirdlargest category, accounting for 18.7% of the
companys total sales in 2012. Revlon is also the thirdlargest marketer in the overall
category.
Revlon posts a moderate growth of 3.4% to reach $152million in 2012, from
$147millionin2011.
The leading brand, Revlon Colorsilk, posts a healthy growth of 3.8%. Sales advance
from $130million in 2011 to $135million in 2012. However, further growth of the
marketerisrestrictedbynegligibleTME.
TheextensionoftheColorsilkrangecontributestothemarketersgrowthin2012.
RevlonintroducestheLuxuriousColorsilkButtercreamlinein2012.Theproductlineis
a permanent hair color that erases gray hair. The product is ammoniafree and is
availablein13shades.
5317
5318
Revlon
Revlonssalesinthelipsticksandlipglossescategorydeclineby2.3%,from$129millionin
Revlonscategorysharedecreasesfrom9.5%in2011to9.2%in2012.
Revlon competes in the mass lip category with its Revlon and Bari brands. Although
RevloncompeteswiththeAlmaybrandinothermakeupcategories,Almaynolonger
participatesinthelipcategory.
SalesoftheRevlonbranddecline1.6%to$123millionin2012,downfrom$125million
in2011.
SalesoftheRevlonbranddeclineprimarilyduetothedipinlipglosssalesforthebrand.
Itsliplinerandlipsticksegmentsarerelativelyflat.
Thedeclineinsales,however,isnotattributedtothelackofadvertisingsupportfrom
the company, as the budget increases over 40% to $33million in TME in 2012 from
$23millionin2011.
NailpolishesisthesmallestmakeupcategoryforRevlon,accountingfor13.3%ofRevlons
totalcosmeticsandtoiletriessalesintheUnitedStates.
Revlonisthesecondlargestmarketerinthenailpolishescategoryin2012.
Revlons sales reach $108million in manufacturers sales in 2012, up 20.0% from
$90millionin2011.
Nailpolishesrepresent18.0%ofRevlonstotalmakeupsales.
RevlonacquiresBonBonsandPureIcefromBariCosmeticsin2012.
PureIcessalesreach$25millionin2012,up13.6%from$22millionin2011.
Sinfulssalesreach$34millionin2012,up30.8%from$26millionin2011.
Revlons category share increases to 16.3% in 2012, up from 15.9% in 2011 primarily
duetoitsnewlaunchactivity.
RevlonincreasesitsTMEby57.1%to$19.8millionin2012from$12.6millioninTMEin
2011.OverhalftheexpendituresupportstheColorstaynailpolishline.
Revlonssalesinthedeodorantsandantiperspirantscategoryremainunchangedfromthe
previousyear,recordedat$52millionin2012.
Lackofnewproductactivityoffsetsthemarketersgrowthinthecategoryin2012.
ThecategorystwomainbrandsareMitchumandLadyMitchum.
The sales of the Mitchum brand declines by 5.7%, from $35million in 2011 to
$33millionin2012.
ThesalesforLadyMitchumbrandgrow11.8%from$17millionin2011to$19million
in2012.
SalesinwomensfragrancesforRevlondeclinefrom$7millionin2011to$5millionin2012.
JeanNatcontinuestobeRevlonsbestsellingfragrancebrand.
SalesofJeanNatdeclineby25.0%,from$4millionin2011to$3millionin2012.
Sales of the companys heritage brand Charlie drop from approximately $2million in
4A318
Revlon
RECENTDEVELOPMENTS
Acquisitionsandmergers
Terms of the transaction are not disclosed; however, Revlon uses $22million of
borrowings under its 2011 Revolving Credit Facility, along with cashonhand to fund
theacquisition.
Otherdevelopments
InJune2012,RevlonsettlesitsdisputewithshareholderFidelityManagement&Research
regardingaclassactionlawsuitrelatedtoashareexchangeofferfrom2009.
NOTABLENEWPRODUCTS
Table5164:SelectNewProductsIntroducedbyRevlonintheUnitedStatesin2012
Brand
Category
Description
Revlon
Eyemakeup
SmokyShadowStick
Revlon
Eyemakeup
PhotoreadyPrimer,Shadow+Sparkleeyeshadow
Revlon
Facemakeup
NearlyNakedFoundation
Revlon
Facemakeup
PhotoreadyAirbrushMousseMakeup
Revlon
Facemakeup
ColorstayWhippedCremeMakeup
RevlonColorsilk
LuxuriousColorSilkButtercreamisanammoniafree,
permanentathomehaircolorthatisavailablein13
shades.Theformulapreventsoversaturationofdyeto
attainuniformcolorthroughout
Revlon
ColorburstLipButter
Revlon
JustBittenKissableBalmStain
Revlon
Nailpolishes
Brilliantnailpolish
5319
5320
Revlon
MARKETINGACTIVITY
Revlon continues to use heavy advertising, pricing discounts, and coupons to promote
products.
The marketer primarily promotes its products through a variety of promotional tools
including, print, television, and the Internet advertising, as well as pointofsale
merchandisingincludingdisplaysandsamples.
Revlon, for its facial treatment products, runs a fourpage insert in the September
issuesofVogue,Glamour,Allure,andSelfthatincludestipsonskincare,haircare,and
cosmetics.
Revlonsupportsitsbrandswithcelebrityendorsements.
The marketer utilizes famous actresses and models as spokespersons to endorse its
products.
Theendorsementsarethroughtelevisionandtheprintmedia.
Revlon signs actress Emma Stone to promote its launch of Just Bitten Kissable Balm
Stain.
Themarketeroffersdiscountcouponstosupportitsnewlaunches.
Revlon offers discount coupons, usually as freestanding inserts (FSIs) in weekly
newspapers.
Revlonoffers$2.00offonanyRevlonPhotoReadyFaceProduct.
RevlonalsousestheInternetasoneofthemajorsourcesofadvertisingandpromotingits
brands.
The marketer uses social media sites, such as Facebook, Pinterest, and Twitter, to
promoteitsproducts.
The marketer utilizes its brands website as an important medium to promote its
products.Revlonprovidesmakeuptipsandmakeupsolutionsonitswebsite.
Themarketersharesitsnewproductlaunches,otherproductoffers,andcontestsonits
Facebookpagetopromotesales.
Revlon conducts various contests on its website to encourage consumers to buy its
products. For example, the marketer asks consumers to share their favorite makeup
storyonitsFacebookpage,forachancetowinatriptoNewYork.
Revlonspendsabout$161.4millionontraceablemediaexpenditures(TME)tosupportits
brandsin2012,up3.1%from$156.6millionin2011.
Morethan97%oftheTMEisspentthroughtelevisionandlocalmagazines.
The company promotes its products mainly through television (50.9%), followed by
localmagazines(46.3%)in2012.
Revlon is the fourthlargest advertiser in the lipsticks and lip glosses category with a
TMEof$32.9millionin2012,upfrom$23.2millionin2011.
4A320
Revlon
The marketer allocatesTME of $44.9 for its face makeup category in 2012 and the entire
TMEisallocatedtopromoteitsRevlonandAlmayproductlines.
About$17millionoftheTMEisusedtopromotetheRevlonColorstayproductline.
AlmayusesitsTMEforitsSmartShadePowderandFoundationproducts,aswellasfor
itsWakeUpPowderproduct.
OUTLOOK
Revlonisexpectedtopostmoderategrowthof2.0%overtheforecastperiod,2012to2017.
Growth in the cosmetics and toiletries market will be supported by new product
launchesacrosscategoriesoverthenextfiveyears.
AlanT.Ennis,PresidentandCEOofRevlon,intendstorevivethecompanysleadership
positioninthecosmeticsandtoiletriesindustryintheUnitedStates.Inordertotake
Revlon to greater heights, Ennis plans to focus on growing the business and the
companysbrandsbyenhancingtheorganizationalpotentialintheUnitedStates,while
driving Revlon to expand globally. Ennis also says in 2012 that he intends to expand
manufacturing in the United States, moving away from China, because of cost and
qualityissues.
The makeup product class is expected to account for themajority ofthe marketers sales
andislikelytodriveRevlonssalesoverthenextfiveyears.
Eyemakeupisexpectedtobethehighestrevenuegeneratorovertheforecastperiod.
Themarketerwillcontinuetoinnovateonmascarabrushtechnology,withenhanced
productformulations,includingbenefits,suchaslashbuilding,eyelashtreatments,and
primerstodrivesales.
Themarketerisexpectedtointroduceeyemakeupproductsthatincorporatebenefits,
such as hair growth, or innovative skin care ingredients that are likely to foster the
growth.
Revlonisexpectedtolaunchlimitededitioneyeshadowcollectionstoaddincremental
salesthroughouttheyearandtocreateexcitementinthecategory.
Further, the marketer plans to launch eye makeup products with natural ingredients
whichareexpectedtogainmorepopularityinthefuture.
New formulations and delivery mechanisms will continue to fuel sales in the eye
makeupcategory.
Newshadesincludingglittereyelinersarepredictedtogrowduringtheforecastperiod.
New technology and new shades are expected to continue to drive sales in the
eyebrowsegment,aswellascapturemoreconsumersastheyaddeyebrowmakeupto
theirregimen.
5321
5322
Revlon
Thefacemakeupcategoryisexpectedtopostmoderategrowthof2.5%overtheforecast
period.
Revlon is expected to launch products with new benefits, formulas, or ingredients to
supportitssalesgrowth.
drivesales.
The company is expected to incorporate antiaging and antiacne ingredients to
supportsales.
Productswithbetterfeatures,formulations,andpackagingareexpectedtosupportthe
marketersgrowthinthecategory.
Revlonisexpectedtopostmoderategrowthinthehaircoloringproductscategoryoverthe
nextfiveyears.
Revlonplanstolaunchproductswithimprovedformulationsandcolorstosupportits
salesinthecategory.
Productswithimprovedformulations,suchasfoambasedandcreambasedhaircolors
Revlon will continue to launch foambased hair colors which are likely to be in good
demandinthefuture.
Themarketerwillcontinuetofocusoneliminatingharshchemicalssuchasammonia
fromitshaircoloringproductstodrivesales.
Revlonwillfocusonincorporatingmultiplebenefits,suchasnourishmentofhairand
sunprotectionovertheforecastperiod.
Over the next five years, Revlon is projected to post moderate growth in the lipsticks
category.
Revlonwillcontinuetolaunchnewandimprovedproductswithinnovativeingredients,
improvedapplicators,andpackagingtoinspirewomentopurchase.
Products containing natural, moisturizing ingredients, such as maracuja oil and/or
argonoilsareexpectedtofuelsalesinthecategory.
Longlasting lipsticks and lip glosses is an area in which the company is likely to
continueintroducingmoreproductvariantsandshowprogressinsales.
Revlonisexpectedtomaintainitsstrongpositioninthemasslipsticksandlipglosses
market.
Revlon plans to launch lipsticks with multibenefits, such as sun protection and
moisturizingbenefits,whichwilllikelydrivethecategoryssales.
4A322
Revlon
Revlonwillcontinuetobuildonimprovingitsstrongbrandsbyfocusingoninnovationsand
marketingactivities.
Themarketerisexpectedtoincreaseitspromotionalandmarketingactivitiesoverthe
forecastperiod.
Revlon will likely increase advertising budgets to include magazine advertising,
revamping of brand websites, and the use of social media as a way to promote its
brandsandproducts.
Revlonwilllikelypostgrowthof1.8%inthenailpolishescategoryovertheforecastperiod.
ThemarketeracquiresBonBonsandPureIcefromBariCosmeticsin2012inorderto
increaseitsmarketshareinthecategoryoverthenextfiveyears.
Revlon will likely increase its media spending on these brands to support its overall
sales.
Further benefits, such as quicker drying time and heat/smear resistant, are likely to
contributetosalesgrowth.
Themarketerwillcontinuetoseekopportunitiesforitsexistingbrandsandmakeeffortsto
acquirenewbrandsovertheforecastperiodtomaintainitsstrongposition.
The marketer is expected to make similar moves over the forecast period to
complementitscorebusiness.
The marketer will also continue to benefit from its competitive pricing and strong
brandloyaltyoverthenextfewyears.
Revlons sales are forecast to increase through 2017 at a CAGR of 2.0% to reach
ToiletriesforRevlonbyProductCategory,2012to2017
Productcategory
CAGR,%
Eyemakeup
2.8
Facemakeup
2.5
2.2
COMPANYAVERAGE
2.0
Nailpolishes
1.8
1.5
0.8
Facialtreatments
0.5
Fragrancesforwomen
0.3
5323
5324
Revlon
4A324
SANOFI
Table5166:SanofisSalesofCosmeticsandToiletriesintheUnited
States,2011and2012
$Million
Category/brand
2011
HANDANDBODYLOTIONS
GoldBond
2012
65
66
63
66
SHAMPOOS
SelsunBlue
36
36
SelsunBlueNaturals
UltraSwim
45
45
194
197
MOUTHWASHES
Act
Total
SUNCAREPRODUCTS
BullFrog
SunIn
GoldBond
BABYCAREPRODUCTS
BabyGoldBond
TOTAL
COMPANYOVERVIEW
Sanofiisoneofthelargestpharmaceuticalcompaniesintheworld.
ThecompanyisheadquarteredinParis,France.
Operating primarily under two business segmentsPharmaceuticals and Vaccines

the companys principal activities include research, development, production, and
distributionofpharmaceuticalproductsaroundtheworld.
The Pharmaceuticals business segment includes manufacturing, marketing, and

distributionofmedicinesfortherapeuticareasthatincludecardiovascular,thrombosis,
centralnervoussystem,oncology,metabolicdisorders,andinternalmedicine.
The company manufactures, markets, and distributes vaccines used for treating
tetanus, whooping cough, diphtheria, HIV/AIDS, and Hepatitis B, under the Vaccines
businesssegment.
5326
Sanofi
Operatingallovertheworld,Sanofiemploysmorethan111,974peopleworldwideandis
presentinmorethan100countriesin2012.
WiththecompletioninMarch2010oftheacquisitionofChattem,aleadingmarketer
and manufacturer of personal care and health care products, Sanofi entered the
cosmeticsandtoiletriesbusiness.
Based in Chattanooga, TN, Sanofi manufactures and markets overthecounter (OTC)

drugs,toiletries,anddietarysupplements.
Sanofi markets the following brands under its cosmetics and toiletries segment: Act, Bull
Frog,GoldBond,BabyGoldBond,SunIn,IcyHot,Selsun,SelsunBlue,andUltraSwim.
In 2012, total corporate sales grow 4.7% to 34,947million ($44,913million), from

Net profits in 2012 decrease to 4,967million ($6,383million), down 12.8% from

TheUnitedStatesistheprincipalmarketforthecompany,witha31.1%shareoftotalsales.
TotalU.S.salesforthecompanyare10,873million($13,974million).
OtherimportantmarketsaretheemergingmarketsandWesternEuropeancountries.
The company is currently shifting from established but lesserperforming markets,

suchastheUnitedStatesandWesternEurope,toemergingmarkets.
Since2007,saleshavegrownatacompoundannualgrowthrate(CAGR)of4.5%peryear,
andnetprofitshavedeclinedataCAGRof1.2%.
Table5167:SanofisGlobalCorporateSalesandProfits,2007to2012
Million
Year
Sales
Netprofits
Profitmargin
Returnonequity
2007
28,052
5,263
18.8
11.8
2008
27,568
3,851
14.0
8.6
2009
29,785
5,265
17.6
10.9
2010
32,367
5,467
16.8
10.3
2011
33,389
5,693
17.1
10.1
2012
34,947
4,967
14.2
8.6
NOTE:$1.00=0.7781.
4A326
Sanofi
Table5168:CosmeticsandToiletriesBrandsofSanofiintheUnitedStates,2012
Brand
Category
Act
Mouthwashes
BabyGoldBond
Babycareproducts
BullFrog
Suncareproducts
GoldBond
Handandbodylotions,footcareproducts,talcumand
dustingpowders,personalcleansingproducts
SelsunBlue
Shampoos
UltraSwim
Shampoos
SunIn
In2012,salesofSanofiscosmeticsandtoiletriesintheUnitedStatespostanincreaseof
1.5%,from$194millionin2011to$197million.
Since2007,thecompanyssalesintheindustryhavegrownataCAGRof4.5%.
Table5169:SanofisSalesofCosmeticsandToiletries
Year
$Million
Change,%
2007
158
2008
179
13.3
2009
176
(1.7)
2010
188
6.8
2011
194
3.2
2012
197
1.5
HandandbodylotionsisthebiggestcategoryforSanofi.
Salesgrowby1.5%,from$65millionin2011to$66millionin2012.
ThecategorysshareinthecompanystotalU.S.cosmeticsandtoiletriessalesis33.5%
in2012.
GoldBond,thecompanysonlybrandinthecategory,rankssixthamongmassbrands
intheoverallhandandbodylotionscategory.
5327
5328
Sanofi
The companys secondlargest product category, mouthwashes, accounts for 33.5% of its
salesin2012,upfrom32.5%in2011.
Sanoficontinuestobethethirdleadingmarketerinthemouthwashescategory.
Company sales in this category increase by 4.8% in 2012, to $66million from

$63millionin2011.
The company increases its market share from 8.1% in 2011 to 8.3% in 2012 in the
category.
SanofissalesgrowthinthecategoryissupportedbyitsnewlaunchActTotalCare.
Productsformulatedforchildrenarebecomingincreasinglypopularwithparentsasa
meanstobothensuresafetyforchildrenandencouragechildrentousetheproduct.
ActsAnticavityKidsrinseforchildrenispopularamongconsumers.
Theshampoosproductcategoryrepresentsthecompanysthirdlargestcategory.
Salesofshampoosremainflatat$45millionin2012.
ThecompanysellsSelsunBlue,SelsunBlueNaturals,andUltraSwimbrandsunderthis
category.
Themarketshareofthecompanydecreasesfrom1.8%in2011to1.7%in2012inthe
category.
Thesalesofallthreebrandsinthecategoryremainflatin2012.
Lackofnewproductactivityleadstotheflatgrowthforthemarketerinthecategory
in2012.
Thecompanyssuncarebrand,BullFrog,postssalesof$8millionin2012,thesameasin
2011.
Lackofnewproductactivityandpromotionalsupportleadstotheflatgrowthofthe
categoryin2012.
Thesalesofhaircoloringproductsandbabycareproductsremainflatfrom2011salesat
$6millionand$2million,respectively,in2012.
Lackofnewproductactivityandpromotionalsupportleadstotheflatgrowthinboth
categoriesin2012.
RECENTDEVELOPMENTS
Mergers,alliances,divestures,acquisitions
Thecompanymakesanumberofacquisitionsandasignificantdivestiture.
InJuly2012,Sanofiannouncestheexecutionofanagreement,accordingtowhichit
willdivestitsdirectandindirectstakeofaround19.3%intheYvesRocherGroup.
In October 2012, Sanofi and The Coca Cola Company set up a 5050 partnership to
launchdrinkscarryingwellbeingandbeautyclaims.
In October 2012, Sanofi announces acquiring Genfar SA, a pharmaceuticals

manufacturerbasedinColombia.Thefinancialdetailshavenotyetbeendisclosed.
InJanuary2013,Sanofiannouncescompletingtheacquisitionoftheworldwiderights
totheRolaidsbrandfromMcNeilconsumerhealthcaredivisionofMcNeilPPCInc.
In March 2013, Sanofi sells its only sun care brand, Bull Frog, to Sun & Skin Care
ResearchCompanyforanundisclosedprice.
4A328
Sanofi
Otherdevelopments
In October 2012, Sanofi and BristolMyers Squibb coannounce the restructuring of

theirlongtermalliancefollowingthelossofexclusivityofPlavixandAvapro/Avalidein
severalmajormarkets.
InDecember2012,Sanofiagreestopay$109milliontotheU.S.governmenttoresolve
theallegationsofitsviolationagainsttheFalseClaimsActforprovidingfreeunitsofa
kneeinjection,Hyalgan,tophysiciansintheUnitedStates.
Newproducts
Table5170:SelectNewProductsIntroducedbySanofiintheUnitedStatesin2012
Brand
Category
Description
Act
Mouthwashes
TotalCareinfusedwithnaturalbotanicalsthataregentleonsoremouths,
alcoholfree,andstrengthenstheteeth.Itisavailableintwovariants;Mild
MintandTropicalBreeze
BullFrog
Suncare
MosquitoCoastSPF30ContinuousSprayprovidesa2in1protection
againstthesunandinsects,andlastsupto8hours
MARKETINGACTIVITY
Sanofi continues to primarily promote its cosmetics and toiletries through television
advertisements.
In 2012, Sanofi spends approximately $50.8million in traceable media expenditures

(TME)topromoteitsproducts,down26.5%from$69.1millionspentin2011.
The company allocates approximately $47.6million or 93.7% of its entire TME on

ThecompanyspendsthehighestTMEtosupportitsmouthwashescategorywith52.4%or
$26.6million of its total TME, followed by hand and body lotions with 22.6% or
$11.5millionin2012.
Television advertising is the main means of promotion for Sanofi, though radio, the
Internet,andprintadvertisingarealsoemployed.
TherearetelevisioncommercialspromotingSanofismajorbrandsinthepersonalcare
segment.
Mostoftheadvertisementslotsareinsertedduringshowsthatareknowntohavea
largefollowingamongwomenandfamiliesontelevision.
Sanofialsoemploysmethodssuchasdiscounting,primarilythroughcouponing,topromote
itsproducts.
The marketer distributes coupons usually for newlylaunched products in order to

supportthem.
Couponsofdifferentdenominationsaredistributedthroughmagazines,freestanding
inserts(FSIs),theInternet,andretailstores.Forexample:thecompanyoffers$1.00off
on any Bull Frog sun block product and $2.00 off on Gold Bond Ultimate cream or
lotion.
5329
5330
Sanofi
The remainder of the marketers promotional budget is spent on building awareness and
consumerloyaltyforitsbrands.
The company primarily highlights and emphasizes the medicated properties of its
products through media promotions. These are the competitive strengths of its
products.
In order to respond quickly to the changing consumer trends and to support its
growingbrandswhereneededmost,themarketeremploysagreatdealofflexibility,
reallocatingmediaexpenditurebetweenitspersonalcareandhealthcarebrands.
OUTLOOK
Sanofispersonalcaresalesareexpectedtomaintainamoderategrowthof1.5%duringthe
Growth will be supported by strong performances of brands such as Act in the

mouthwashescategory,BullFroginthesuncareproductscategory,andGoldBondin
thepersonalcleansingcategory.
Themouthwashescategoryisexpectedtopostthehighestgrowthovertheforecastperiod.
Themarketerisexpectedtolaunchproductsspecifictotweens(aged8to12),which
willsupportitssalesovertheforecastperiod.
In 2012, the marketer allocates the highest TME of $26.6million to support its Act
brandofmouthwashes,andwillcontinuetodosoduringtheforecastperiod.
Sanofiplanstointroduceproductswithnaturalformulationstosupportitsgrowthin
thecategory.
The hand and body lotions category is also expected to perform well over the forecast
period.
Introductionofnewproductsofferingadditionalbenefits,suchasantiaging,suncare,
andtherapeuticwillhelpachieveamoderategrowthforthecategory.
Asnaturalandorganicproductssegmentwillcontinuetoperformwellduringthenext
fiveyears,themarketerisexpectedtolaunchsuchproductsinthecategorytosupport
itsgrowth.
Sanofiplanstodivestitsunderperformingbrandsacrosscategoriesovertheforecastperiod.
In March 2013, Sanofi sells its only sun care brand, Bull Frog, to Sun & Skin Care
ResearchCompanyforanundisclosedprice.
Themarketersintentionsarecleartosellordivestitsunderperformingbrandsinthe
futureandfocusonitscorebrands,asitstreamlinesitsportfolio.
4A330
Sanofi
The marketer is expected to increase its marketing and promotional activities over the
forecastperiodtosupportitsgrowth.
Promotionalactivitieswillcontinuetovaryasperthebrandinfocus.Themarketerwill
workoutdifferenttechniquesfordifferentbrands,basingitseffortsonthesizeofthe
brandanditspositioninginthemarket.
The main advertising channel for the marketer over the forecast period will be
ThemarketerislikelytoallocatemajorityofitsTMEtosupportitsActandGoldBond
linesoverthenextfiveyearstosupporttheirgrowthintheirrespectivecategories.
The company is expected to enter new markets and new product categories through
mergersandacquisitions,andsigningpartnershipagreements.
In 2012, Sanofi and The Coca Cola Company set up 5050% partnership to launch
drinkscarryingwellbeingandbeautyclaims.
Productswithcosmeceuticalpropertiesareexpectedtoperformwellovertheforecast
periodandthiswillsupportthemarketersgrowth.
Consumers increasingly seek products with health and beauty claims combined, and
Sanofis step to partner with The Coca Cola Company with these claims will likely
supportthegrowthofthemarketerovertheforecastperiod.
Otherleadingcompaniesinthepersonalcareindustryarealsoexpectedtointroduce
suchcrossindustryproductsasthetrendignitesagain.
Themarketerisexpectedtocontinuetopartnerwithothercompaniestopromoteits
products.
NewproductlaunchesacrosscategorieswillsupportSanofisgrowthinthenextfiveyears.
ThemarketerisexpectedtolaunchnewandinnovativeproductsunderitsGoldBond
andActbrandstosupportitsgrowth.
SanofiwillcontinuetoincreasethenumberofSKUsforitsrespectivecategoriesover
theforecastperiod.ThiswillalsoallowSanofitocommandmoreshelfspaceabetted
bytheincreasingnumberofbrandsinitscosmeticsandtoiletrieslines.
The marketer also has a significant presence in the OTC market space which further
complementsthecompanysstrongrelationshipwithretailers.
Themarketeralsoplanstoincreaseitssocialmediapresenceinordertoengageconsumers
interestovertheforecastperiod.
The marketer is expected to advertise its new products on its Facebook page and
engageconsumerswithvariousconteststosupportitssales.
The Baby Gold Bond brand, the only brand in the baby care products category, might be
phasedoutordiscontinuedbythemarketerovertheforecastperiod.
Lack of new product extensions, stagnant sales for last five years, and lack of TME
support to the category might prompt the marketer to discontinue its product
offeringsinthebabycarecategoryovertheforecastperiod.
SalesofpersonalcareproductsofferedbySanofiareforecasttoincreaseataCAGRof1.5%,
toreach$212millionin2017,upfrom$197millionin2012.
5331
5332
Sanofi
ToiletriesforSanofibyProductCategory,2012to2017
Productcategory
CAGR,%
Mouthwashes
2.5
Suncareproducts
1.5
COMPANYAVERAGE
1.5
Shampoos
1.3
Handandbodylotions
1.3
0.2
Babycareproducts
4A332
SHISEIDO
Table5172:ShiseidosSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
FACEMAKEUP
2012
199
192
Shiseido
26
28
Nars
14
17
Total
239
237
98
104
BareEscentuals
61
61
Nars
14
15
83
85
BareEscentuals
18
18
Nars
12
14
38
41
13
13
LEaudIsseypourHomme
IsseyPourHommeSport
Artisian
23
27
Joico
Zotos
Total
15
15
BareEscentuals
FACIALTREATMENTS
Shiseido
EYEMAKEUP
Shiseido
Total
Shiseido
Total
FRAGRANCESFORMEN
LeMale
Total
SHAMPOOS
(Continued)
5334
Shiseido
Table5172:ShiseidosSalesofCosmeticsandToiletriesintheUnitedStates,
2011and2012
$Million
Category/brand
2011
FRAGRANCESFORWOMEN
2012
LEaudIssey
NarcisoRodriguez
12
12
10
11
527
542
Total
CONDITIONERS
Joico
SUNCAREPRODUCTS
Shiseido
HANDANDBODYLOTIONS
Shiseido
TOTAL
COMPANYOVERVIEW
Shiseido is the top cosmetics marketer in Japan and is ranked globally among the leading
luxurycosmeticsmarketers.
The company was founded in Tokyo in 1872, originally as a pharmacy. It shifted its
focustocosmeticsin1915.
Shiseido offers products in the makeup, skin care, and hair care product classes.
Additionally,italsomarketsfoodproducts,pharmaceuticals,andfinechemicals.
ThecompanywasformallyincorporatedinJune1927.
ThecompanysheadquartersislocatedinTokyo,Japan.
Itemploysapproximately46,267employeesworldwidein2012.
ThecompanysU.S.subsidiaryShiseidoCosmetics(America)wasfoundedin1965.
Shiseidos primary distribution channels globally are department stores, general
merchandisestores,anddrugstores.
The companys five research and development centers are located in China, Europe,
SoutheastAsia,theUnitedStates,andJapan.
IthasninemanufacturingunitsinJapanand10abroad.
Thecompanyfranchises25,000cosmeticsoutletsinJapan.
4A334
Shiseido
Thecompanysbusinessisdividedintothreesegments:DomesticCosmetics,International
Cosmetics,andOthers.
The company manufactures and sells pharmaceuticals for medical use and aesthetic
cosmeticsmaterials.Itisalsoinvolvedinretailclothing,miscellaneousgoods,andthe
restaurantbusiness.
The company owns a French cuisine restaurant in Tokyo called the L'Osier, which
earnedthehighestMichelinratingofthreestars;andTheShiseidoParlour,aWestern
stylerestaurantthatstartedassodafountainin1902.
Shiseidohas97subsidiariesand13associatedcompaniesasofMarch2012.
The total corporate sales for Shiseido increase from 670,701 million ($8,407 million) in
2011to682,386million($8,553million)in2012,up1.7%.
Thecompanyreportsnetprofitsof14,515million($182million)in2012.
Table5173:ShiseidosGlobalCorporateSales,2007to2012
Million
Year
Sales
Netprofits
2007
694,594
25,293
2008
723,485
2009
Profitmargin
Returnonequity
3.6
6.6
35,460
4.9
9.2
690,256
19,373
2.8
5.4
2010
644,201
33,671
5.2
9.8
2011
670,701
12,791
1.9
3.9
2012
682,386
14,515
2.1
4.9
NOTE:$1.00=79.78.
Thetotalnetsalesofcosmeticsproductsdomesticallycommand51.8%ofShiseidosoverall
salesin2012,adeclineof1.3%from53.4%in2011.
Netsalesofoverseascosmeticswitnessanincreasefrom45.1%to46.8%,from2011to
2012.
5335
5336
Shiseido
Table5174:ShiseidosGlobalSalesbyBusinessDivision,2011and2012
Billion
Division
2011
2012
Domesticcosmeticssales
358.4
353.8
Overseascosmeticssales
302.6
319.7
9.7
8.9
Allothera
%Oftotal
2011
2012
53.4
51.8
45.1
46.8
1.4
1.3
Total
670.7
682.4
100.0
aIncludessalonproducts,pharmaceuticals,healthandbeautyfoods,andfinechemicals.
NOTE:$1.00=79.78.
100.0
Mostofthecompanysbusiness,55.9%,comesfromJapan.
ThesecondlargestcontributorisAsia/Oceania(besidesJapan)with18.3%,followedby
Europe.
TheAmericasaccountfor12.7%ofnetsales.
ShiseidostotalsalesincosmeticsandtoiletriesintheUnitedStatesincreaseby2.8%,from
Table5175:ShiseidosCosmeticsandToiletriesSalesin
Year
$Million
Change,%
2007
460
2008
477
3.7
2009
478
0.2
2010
494
3.3
2011
527
6.7
2012
542
2.8
4A336
Shiseido
Shiseidosleadingproductcategory,facemakeup,contributes43.7%ofthecompanyssales
in2012.
Salesinthecategorydeclineby0.8%from$239millionin2011to$237millionin2012.
Shiseido continues to be the fourthleading company in the face makeup category in
2012.
The Bare Escentuals brand contributes $192million in sales to the company in 2012,
butsalesdecline3.5%asitssalesdipacrossallcategories.
Shiseido increases its TME by 59% for its Bare Escentuals Bare Minerals brand, to
approximately $13.2million in 2012. Onequarter of this is used to promote the new
launch of Ready foundation. The namesake brand does not receive TME in 2012;
however,thecompanysotherluxurybrand,CleDePeauBeaute,receivescloseto2%
ofthecompanysTME.
Bare Escentuals launches a new cream foundation, Ready SPF 20 and a correcting
concealer,butsalesarenotenoughtocompensateforthedropinsalesfromexisting
Nars, the makeup artist brand, outperforms other brands within Shiseidos portfolio,
with sales reaching $17million in 2012, up 21.4% from $14million in 2011. Sales are
drivenbythebrandsblushandbronzingpowder.
The Shiseido brand outpaces the overall market performance, up 7.7% to reach
$28million in sales in 2012, up from $26 million in 2011. The brand introduces new
foundationsandlimitededitioncompactpowder.
Facialtreatmentsaccountsfor19.2%ofthecompanyssalesin2012.
Salesofthecategorygrowfrom$98millionin2011to$104millionin2012,up6.1%.
Facial treatments is the secondlargest category of the company, and the brand
Shiseidoissoldunderthiscategory.
Theeyemakeupcategory,thethirdlargestcategoryinthecompany,accountsfor15.7%of
thecompanysoverallsalesin2012.
Salesofthecategoryincreaseby2.4%from$83millionin2011to$85millionin2012.
ThecompanymarketsBareEscentuals,Nars,andShiseidobrandsunderthiscategory.
Sales of Bare Escentuals remain unchanged from the previous year, at $61 million in
2012.
New product extensions and better traceable media expenditures (TMEs) to support
thebrandgarnerthegrowthoftheBareEscentualssalesin2012.
Narssalesgrowfrom$14millionin2011to$15millionin2012,upby7.1%.
SalesfortheShiseidobrandgrows12.5%,from$8millionin2011to$9millionin2012.
Lipsticksandlipglossesgrowfrom$38millionin2011to$41millionin2012.
Categoryssalesgrowby7.9%in2012.
Newproductlaunchesinthecategorysupportthemarketersgrowthin2012.
In2012,ShisheidolaunchesNarsVelvetGlossLipPencilthatclaimstoprovideaglossy
finish.
TheBareEscentualsbrandcontributes43.9%ofthetotalsalesinthecategoryin2012.
Thesalesofthebrandremainsflatat$18millionin2012,constantwith2011levels.
SalesoftheShiseidobrandgrow12.5%,from$8millionin2011to$9millionin2012.
SalesoftheNarsbrandgrowby16.7%,from$12millionin2011to$14millionin2012.
The growth of Nars brand is supported by new product launches in the category in
2012.
5337
5338
Shiseido
The companys sales for the fragrances product class grow by 11.4%, from $35 million in
Thefragrancesproductclasscontributesto7.2%ofthetotalcompanyssalesin2012.
Lack of TME support in the category leads to the marginal growth of the categorys
sales.
Thefragrancesformencategorygrowsfrom$23millionin2011to$27millionin2012,
upby17.4%.IsseyPourHommeSportlaunchesin2012andcontributestothegrowth.
Thefragrancesforwomencategoryisflatat $12million in2012,constantwith 2011
levels.
Limitednewproductintroductionsandpromotionalactivitiesoffsetthegrowthforthe
marketerintheproductclassin2012.
The hair care product class comprising both shampoos and conditioners collectively
contributes4.8%tothetotalcompanyssalesin2012.
ThecompanysellsJoicoandZotosbrandsunderthesecategories.
SalesofJoicoincreaseby5.3%,from$19millionin2011to$20millionin2012.
SalesofZotosremainflatat$6millionin2012.
RECENTDEVELOPMENTS
NosignificantM&Aactivityisobservedforthecompanyin2012.
Managementchanges
InApril2012,theU.S.subsidiaryofShiseidoannouncestheelevationofPankajGuptatothe
positionofChiefFinancialOfficer.
In June 2012, Shiseido announces a plan to strengthen its U.S. corporate, manufacturing,
anddistributionoperations.
ThecompanyannouncesthatitwillaligntheU.S.finance,legal,andhumanresources
functions of its premier consumer brands including Bare Escentuals, Beaute Prestige
InternationalUSA,Nars,andShiseidointoanunified,sharedservicesplatform.
4A338
Shiseido
NEWPRODUCTS
Table5176:SelectNewProductsIntroducedbyShiseidointheUnitedStatesin2012
Brand
Category
Description
BareEscentuals
Facialtreatments
BaremineralsMultiWrinkleRepairclaimstoworkonmultiplelayersof
theskintodiminishforeheadwrinkles,browfurrows,laughlines,and
crowsfeet
BareEscentuals
Facemakeup
ReadySPF20Foundation
BareEscentuals
Facemakeup
CorrectingConcealer
Nars
Eyemakeup
EyelinerStylofelttipliquideyeliner
Nars
Eyemakeup
LargerThanLifeLongWearEyeliner
Nars
Lipsticks
VelvetGlossLipPencil,abutterylipformula,intheformofapencilthat
providesaglossyfinish
Shiseido
Facialtreatments
WhiteLucentIntensiveSpotTargetingSerumisabrighteningserumto
diminishstubborndarkspotsin10daysandpreventfuture
pigmentationfromappearing
MARKETINGACTIVITY
The companys spending on mediabased advertising and promotions is $52.1 million in

2012.
The largest part of the media spend is for television spots and magazines, which
togetheraccountfor96.9%ofthetotalmediaexpenditures.
The company spends about 48.7% on television advertisements and 48.2% through
magazines.
The company spends 65.0% of its media budget on the promotion of its makeup
productsin2012.
Shiseido helps to promote the Bare Escentuals products with TME of approximately
$32.1millionin2012.
Shiseidooffersdiscountcouponsandfreesamplestopromoteitsproducts.
In2012,themarketeroffersfreesampleofitsnewFutureSolutionEyeRegenerating
CreamwithanUltimateRegeneratingSerumpurchase.
Themarketeralsooffersfreeshippingforproductsboughtthroughitswebsite.
Shiseidooffers20%offonatotalorderfortwodaysstartingCyberMondayforitsNars
products.
The marketer offers discount coupons of denominations ranging from $2.00 to $6.00
onitsBareEscentualsbrand.
5339
5340
Shiseido
While pointofsale displays and advertising are still important, as store traffic decreases,
thecompanyincreasesitspresenceonlineinordertocreategreatervisibilityofitsbrands
andtosupportitsonlinesales.
Shiseido employs the Internet as one of the major sources of advertising and
promotingitsbrands.
The marketer uses social media sites, such as Facebook, Youtube, and Twitter, to
promoteitsproducts.
Thecompanyalsopromotesitsproductsthroughitswebsite.
Themarketerprovidesmakeuptipsandadvicetoconsumersonitswebsite.
The company also provides limitedperiod offers, for example, an Ultimate Cleansing
Oilforfreewiththepurchaseofanytwosuncareproducts.
SalesrepresentativesareanotherimportantsourceforpromotingShiseidosproducts.
The company uses sales representatives as one of the main promotional vehicles for
promotingitsfacemakeupproducts.
ShiseidosBareEscentuals,oneoftheleadingdirectsellingbrands,organizesregularevents
featuringnationalmakeupartistsinpopularmagazinesandinstorepromotionstopromote
itsproducts.
Bare Escentuals products, such as Matte SPF 15 foundation or Original SPF 15
foundation, feature makeup artists in leading fashion magazines, such as Allure and
Seventeen.
Thecompanyalsousesmassretailersanddepartmentstorestopromoteitsproducts.
BareEscentualspromotesitsproductlinethroughQVC.
Besides QVC, infomercials, and company boutiques, Bare Escentuals expands
distribution to department stores and specialty stores including Bloomingdales, Ulta,
andSephora.
OUTLOOK
Shiseidoisexpectedtopostmoderategrowthof3.0%overthetheforecastperiod,2012to
2017.
New product launches with better technology will likely drive the sales for the
marketerintheoverallcosmeticsandtoiletriesmarketintheUnitedStates.
The marketers plan of expanding its business in the United States is expected to
supportitsgrowth.
4A340
Shiseido
The largest category for Shiseido, face makeup, is expected to be the highest revenue
generatoroverthenextfiveyears.
Mineral powder foundation must tout new benefits, formulas, or ingredients to
reignitethesegment.
The marketer is also expected to increase its product portfolio with more variants in
thecategoryoverthenextfiveyears.
Shiseido will likely provide new variations to the traditional pressed powder blush in
forms,suchaswhippedcream,sticks,andliquidtints.
drive sales as marketers extend the shade range and continue to showcase pressed
powdersinprismordesignformatstoobtainshelfappeal.
The high growth of the category is not likely to be supported by the Bare Escentuals
brand in the United States, due to intense competition from other brands in the
categoryandoversaturationofmineralmakeup.
TheothermakeupcategoriesforShiseidoarealsoexpectedtoperfromwelloverthe
forecastperiod.
Shiseido is likely to introduce eye makeup products with new technology and new
shadesthatwilldrivethecategoryssales.
The marketer will continue to launch new and improved products with innovative
ingredients,improvedapplicators,andpackaginginordertosupportthegrowthofits
lipsticksandlipglossescategoryinthefuture.
Facial treatments, the secondlargest category for Shiseido, is also expected perform well
The marketer is expected to launch facial treatments with multibenefits such as
brightening,luminosity,andradiancetosupportthecategoryssales.
Facialtreatmentswillbeusedbothasasubstitutetocosmeticproceduresandasan
adjuncttothem,withthecommongoaloflookingasyoungaspossible.
The growing demand for antiaging products is expected to drive the sales of the
categoryforthemarketeroverthenextfiveyears.
The company is likely to leverage the aggressive direct marketing strategy that Bare
Escentualspractices.
For instance, Bare Escentuals home shopping and companyowned stores is likely to
provideShiseidoproductsmoreconsumervisibility.
Shiseidos joint product development with Bare Escentuals will further strengthen its
currentproductportfolio.
Thecompanyplanstosellitsotherbrandsthroughdirectmarketingthroughtelevision
togainbettermarketshareinthefuture.
5341
5342
Shiseido
Themarketerisexpectedtoincreaseitsmarketingandpromotionalactivitiestosupportits
salesoverthenextfiveyears.
Thecompanyislikelytospendmoreonpromotingitsexistingandnewproducts.
The Bare Escentuals brand that is present in most categories is expected to get the
highestTMEallocationovertheforecastperiod.
Increasingly,Shiseidoispoisedtoutilizedigitalandsocialmediaasanimportanttool
formarketingitsbrands.
ShiseidoplanstoexpanditsoperationsintheUnitedStatesinordertostrengthenitsglobal
presenceovertheforecastperiod.
The marketer is expected to increase production in its main personal care production
centerintheUnitedStates.
Theincreaseinproductiongivesaclearindicationthatthemarketerisexpectedtopost
stronggrowthovertheforecastperiod.
The marketer will focus on enhancing distribution for its core brands including Bare
Escentuals,Nars,andShiseido.
Themarketerwillcontinuetoincreaseitsproductofferingsthroughmoreretailstores
overtheforecastperiodtosupportitsoverallsales.
The marketer plans to open new distribution centers in the United Sates in order to
supportitssalesbothintheUnitedStatesandgloballyovertheforecastperiod.
Sheseidoisexpectedtoincreaseitsproductofferingsthroughmoredrugstoresoverthe
forecastperiodinordertosupportitsoverallsales.
Promotionsthroughdrugstoresarelikelytoincreaseandthereisthelikelihoodofthe
companyinstallingnewcounterstostrengthenitslineofglobalbrands.
Thecompanyisexpectedtoenterintonewmarketsandnewproductcategoriesthrough
mergersandacquisitionsovertheforecastperiod.
The company is expected to expand its product line and acquire more foreign
companiesthatfitintoitslineofbusiness.
Themarketerislikelytophaseoutitsproductsinthehandandbodylotionscategoryover
the forecast period, through lack of significant activities including new launches or TME
supportforitsbrandsinthecategory.
Moreover, sales in the category have remained stagnant for a few years now,
compellingthemarketertodiscontinueproductsinthiscategory.
The marketer is expected to benefit from naturally positioned products over the forecast
period.
ThecompanylaunchesBaremineralsskincareproductsin2012andislikelytolaunch
similarproductsovertheforecastperiod,expandingfromitsoriginalmineralmakeup
focusintohighergrowthsegments.
4A342
Shiseido
ShiseidossalesofcosmeticsandtoiletriesareprojectedtogrowataCAGRof3.0%toreach
ToiletriesforShiseidobyProductCategory,2012to2017
Productcategory
CAGR,%
Facialtreatments
3.5
Facemakeup
3.2
COMPANYAVERAGE
3.0
Eyemakeup
2.8
2.5
Haircare
2.2
Handandbodylotions
1.0
Fragrancesformen
1.0
Fragrancesforwomen
0.8
Suncareproducts
0.8
5343
5344
Shiseido
4A344
UNILEVER
Table5178:UnileversSalesofCosmeticsandToiletriesintheUnitedStates,2011and2012
$Million
Category/brand
2011
2012
Dove
642
680
Caressr
129
137
Suaver
129
133
Axe
80
79
Lever2000r
68
65
St.Ives
38
36
1,090
1,134
Degree
254
265
Dove
183
209
Axe
206
207
Suave
73
74
Total
716
755
Suave
186
193
TRESemmr
120
117
Dove
76
72
Nexxus
40
41
Axer
44
40
SuaveforMen
34
33
30
20
20
Sunsilk
Totalr
523
546
Totalr
SHAMPOOS
Clear
TIGI
(Continued)
5346
Unilever
$Million
Category/brand
2011
2012
115
124
Suave
60
59
TIGIr
49
48
Nexxus
32
32
Axe
26
27
Consort
12
11
Dove
11
11
Allother
54
52
359
364
Suave
103
108
TRESemmr
109
107
Dove
68
66
Nexxus
36
37
27
17
17
Sunsilk
Totalr
336
362
Vaseline
114
108
Suaver
54
52
St.Ives
32
32
207
198
Ponds
62
63
St.Ives
29
29
Noxzema
17
17
Simple
10
Totalr
108
119
TRESemm
Totalr
CONDITIONERS
Clear
TIGI
HANDANDBODYLOTIONS
Dove
Totalr
FACIALTREATMENTS
(Continued)
4A346
Unilever
$Million
Category/brand
2011
2012
15
14
JustForMe
TCB
Motions
CombThru
39
39
DoveBodyMists
DegreeBodyMists
14
14
3,406
3,546
Soft&Beautiful
Total
FRAGRANCESFORWOMEN
Total
VaselineLipTherapy
Vaseline
SHAVINGPRODUCTS
Noxzema
TOTALr
rRestated.
COMPANYOVERVIEW
Unileverisoneoftheworldstopmanufacturersofpackagedconsumergoods.
Thecompanysproductsaresoldworldwideinmorethan190countries.
Thecompanysproductportfolioincludessavoryfoods,dressings,spreads,icecream,
beverages,personalcare,homeproducts,andhomecare.
TheUnileverGroupoperatesunderadualstructure,UnileverNVandUnileverPLC.
Unilever NV is a publiclimited company registered in The Netherlands, and Unilever
PLCisapubliccompanyregisteredinEnglandandWales.
ThecompaniesarelistedontheEuronextAmsterdam,andLondonandNewYorkStock
Exchanges.
Thetwoparentcompaniesoperateasasingleeconomicentity,TheUnileverGroup.
ThegroupoperatesinallthemajorcountriesinEurope,theAmericas,Asia,andAfrica.
Itemploysabout171,000peopleasofDecember31,2012.
5347
5348
Unilever
Thecompanyisdividedintotwoglobaldivisions,Home&PersonalCareandFoods.
The Home& Personal Care division covers eight product categories: deodorants, hair
care, household care, laundry, mass skin care, oral care, personal wash, and prestige
products.
TheFoodsdivisionaccountsforcategoriessuchassavoryfoodsanddressings,spreads
andcookingproducts,health,wellnessandbeverages,andicecreamandfrozenfoods.
Otheroperationsincludeplantations,plantbreeding,andtextiletrading.
Thetotalcorporatesalesforthecompanyincreasefrom46,467million($59,719million)in
2011to51,324million($65,961million)in2012,upby10.4%.
Corporate net profits reach 4,948 million ($6,359 million) in 2012, up 7.0% from
Since 2007, Unilevers sales have increased at a compound annual growth rate (CAGR) of
5.0%,andnetprofitshavegrownataCAGRof3.7%.
Table5179:UnileversGlobalCorporateSales,2007to2012
Million
Year
Sales
Netprofits
Marginonsales,%
2007
40,187
4,136
10.3
2008
40,523
5,285
13.0
2009
39,823
3,659
9.2
2010
44,262
4,598
10.4
2011
46,467
4,623
10.0
2012
51,324
4,948
9.6
NOTE:$1.00=0.7781.
Withrevenuesof20,357million($26,162million),Asia,Africa,theMiddleEastandRussia
continuetoaccountfornearly40%ofUnileverssalein2012.
North,Central,andSouthAmericascombinedsalesaccountfor33.3%ofUnileverssales,
at17,088million($21,961million)in2012,surpassingEuropeasthesecondlargestregion
forUnileverin2012.
4A348
Unilever
Europeposts13,879million($17,837million)insalesin2012,accountingfor27.4%ofthe
companystotalsales.
Table5180:UnileversGlobalSalesbyRegion,2011and2012
Region
Million
%Oftotal
2011
2012
2011
2012
Change,%
Asia/AMET/RUB
17,723
20,357
38.1
39.7
14.9
TheAmericas
15,251
17,088
32.8
33.3
12.0
Europe
13,493
13,879
29.0
27.4
2.9
Total
46,467
51,324
NOTE:$1.00=0.7781.
AMETAfrica,theMiddleEast,andTurkey.
RUBRussia,Ukraine,andBelarus.
100.0
100.0
10.4
UnilevercontinuestobethethirdleadingmarketerofcosmeticsandtoiletriesintheUnited
States,withalargeportfolioofproductsthatincludeshaircareproducts,skincareproducts,
personal cleansing products, deodorants and antiperspirants, fragrances, and shaving
products.
In 2012, the U.S. sales of Unilevers cosmetics and toiletries total $3,546 million, up
4.1%from$3,406millionin2011.
Since2007,manufacturerssalesofUnileverhavegrownataCAGRof3.3%.
Table5181:UnileversCosmeticsandToiletries
Year
$Millionr
Change,%
2007
3,022
2008
3,037
0.5
2009
3,109
2.4
2010
3,206
3.1
2011
3,406
6.2
2012
3,546
4.1
rRestated.
5349
5350
Unilever
The personal cleansing products category continues to be the largest category for the
marketerin2012,withsalesat$1,134millionin2012,up4.0%from$1,090millionin2011.
Unilever continues to be the largest marketer of personal cleansing products, with
28.2%ofthetotalcategoryssalesin2012.Themarketerimprovesitscategoryshare
from27.9%oftotalcategorysalesin2011to28.2%in2012.
withadistinctlead.
Bar soaps is the largest segment for the marketer representing 52.2% of Unilevers
totalcategorysalesin2012.Doveremainstheleadingbrandinthebarsoapssegment,
with sales at $466million in 2012, up 5.9% from $440 million in 2011. The brands
share in the segment improves from 35.5% of the total segments sales in 2011 to
36.8%in2012.
Bodywashes,thesecondleadingsegmentforthemarketerinthepersonalcleansing
productscategory,accountsfor47.4%ofthemarketerssalesinthecategoryin2012.
Sales for the marketer are supported by a varied product portfolio, moderate new
product introductions, and a considerable traceable media expenditure (TME) of
$85.2millionin2012.
Doveistheleadingbrandforthemarketerinthepersonalcleansingproductscategory,
withsalesup5.9%to$680millionin2012,from$642millionin2011.
segments.
Growthofthebrandissupportedbynewproductsintroductionsin2012,especiallyin
thebodywashessegment.
Furthermore,Dovespromiseofusingonefourthproportionasmoisturizingcreamin
itsbarsoapshelpsdrivesalesforthemarketer.Thisgivesconsumersasatisfactionthat
Dovebarsoapsnotonlyprovidecleansingbenefitsbutalsonourishandmoisturizethe
skinsimultaneously.
fourthmoisturizinglotionandareavailableasbodywashesandbodybars.
Dove claims that its body and face wash variants are infused with Micromoisture
Technology that helps prevent skin dryness by replenishing the moisture levels. The
micromoistureioninthebodyandfacewashvariantsgetactivatedontheformation
oflatherandpreventanydiscomfortduetowoundandcuts.
In 2012, Doves Men+Care line of body and face washes is extended with the
introductionoftwomorevariants:FreshAwakeandCleanDefense.
Dovealsoenjoysaloyalcustomerbaseandgoodadvertisingsupportin2012.
In 2012, sales of Caress personal cleansing products advance 6.2% to reach $137
millionin2012,upfrom$129millionin2011.
Suave is the thirdleading personal cleansing brand for Unilever, with sales at
Sales growth for the brand is aided by its affordable pricing and variants available in
ninedifferentfragrances.ThenewestadditionisEverlastingSunshine,a2012launch.
Further growth is due to its brand loyalty among consumers and its easy availability
acrossdifferentretailoutlets.
SalesofAxe,thefourthlargestbrandforthecompany,decline1.3%to$79millionin
2012 from $80million in 2011. The brand represents 5.8% of body washes sales in
2012,downfrom6.1%ofthesegmentssalesin2011.
In2012,salesofLever2000declined4.4%from$68millionin2011to$65millionin
2012.
4A350
Unilever
Unilever continues to be the leading marketer in the deodorants and antiperspirants

categoryin2012.
Themarketerssalestotal$755millionin2012,up5.4%from$716millionin2011.
Degree is the leading deodorant brand for Unilever and the secondleading brand in
thedeodorantsandantiperspirantscategory,withsalesadvancing4.3%to$265million
in2012,upfrom$254millionin2011.
Thebrandsustainsitsgrowthbecauseofitsloyalconsumerbaseandproductofferings
forbothmenandwomen.
In 2012, sales of the Degree brand are supported by the expansion of the womens
ExpertProtection,ClinicalProtection,andNatureEffectsInvisibleSolidsproductlines
withtheLinenDry,CottonFresh,andAbsorbentSeaSaltsvariants,respectively.
In 2012, the marketer also upgrades its Degree Men Adrenaline Series with motion
sensetechnology.Thetechnologyiscomposedofmotionactivatedmicrocapsulesthat
provideextraprotectiontocombatsweatandodor.TheDegreeMenAdrenalineSeries
withmotionsensetechnologycomprisesvariantssuchasAdventure,Extreme,Everest,
SportDefence,andV12.
DoveadvancestobecomethesecondlargestbrandforUnileverinthecategory.The
brandgrows14.2%toreach$209millionin2012,upfrom$183millionin2011.Dove
hasbeenpostinggoodgrowthsince2011.
Doveoffersdeodorantsandantiperspirantsforbothmenandwomen.
In2012,UnileverintroducestheDoveClearToneSkinRenew(forwomen)proclaiming
thatitsformula,enrichedwithcalendulaandsunflowerseedextracts,helpsaccelerate
the skins renewal process, provides 48hour odor and wetness protection, reduces
darkmarks,andprovidesanevenskintone.
Axe,thethirdlargestbrandforthecompany,grows0.5%from$206millionin2011to
$207millionin2012.
In2012,UnilevertakesamajorstepbyintroducingAxeAnarchy,thefirstfragrancein
thebrandshistorytargetingbothmenandwomen.ThebodysprayisallocatedaTME
of$22.9millionin2012,thehighestamonganyofUnileversbrandsinthedeodorants
and antiperspirants category in 2012. The Axe Anarchy For Her is a limited edition
product, with the marketer waiting to see the response that the market has for the
brandsfirstfemaleorientedproduct.
Suave, Unilevers smallest deodorant brand, records sales at $74 million in 2012, up
1.4%from$73millionin2011.Thebrandaccountsfor9.8%ofthemarketerssharein
thecategory.
5351
5352
Unilever
Unilever, the secondleading marketer in the shampoos category, has a 20.8% category
share.Thecompanyssalesgrow4.4%,from$523millionin2011to$546millionin2012.
SuavecontinuestobetheleadingbrandofUnileverinthecategory;andisthethird
largest brand in the category overall as well. Sales of the brand are up 3.8%, from
$186million in 2011 to $193million in 2012. New product activity and increased
marketingcontributetoSuavesperformanceinthecategory.UnileverlaunchesSuave
Professional Moroccan Infusion range of shampoos to support its growth in the
category.However,salesforSuavesmensvariant,SuaveforMen,declinemoderately
by2.9%from$34millionin2011to$33millionin2012.
ThesecondlargestbrandfromUnileverisTRESemm.Thebrandssalesdecline2.5%
from $120million in 2011 to $117million in 2012. Limited promotional activities
contributetothebrandssalesdeclineinthecategory.
Dove,thethirdlargestshampoobrandfromUnilever,declines5.3%from$76millionin
2011 to $72 million in 2012. Limited new product activity contributes to the brands
decline in 2012. The only significant product launch from Dove in 2012 is Damage
SolutionsColorCareShampoo.
Unileverlaunchesanewbrand,Clearinthecategoryin2012.Thebrandachievessales
of$30millioninitsfirstyearoflaunch.Significantmarketingandpromotionalactivity
supports the brands performance in the category. The marketer allocates
approximately$55.4milliontopromoteitsClearbrandin2012.
UnileverdiscontinuesitsSunsilkbrandin2012.
Unilever continues to be the leading marketer in the hair styling products and sprays
categoryin2012.
Unilevers share remains at 21.7% of the categorys sales in 2012, unchanged from
2011.
SalesforUnilevergrow1.4%from$359millionin2011to$364millionin2012.
Themarketersgrowthinthecategoryissupportedbynewproductactivity.
Unilever launches several new products including, TRESemm Body Hair Spray, Axe
GravityDefyingDustgel,andAxeSpikedUpSpray.
TRESemmistheleadingbrandofthecompany,withsalesat$124millionin2012,up
7.8%from$115millionin2011.Thegrowthofthebrandissupportedbyseveralnew
product introductions by Unilever in 2012. Some of the key launches under the
TRESemmbrandincludePlatinumStrengthDeepConditioningtreatmentandKeratin
SmoothHeatProtectionShineSpray.
The secondleading brand of the marketer, Suaves sales decline by 1.7% in 2012 to
reach $59million from $60million in 2011. The brands biggest strength, economical
pricing,doesnotbenefitSuaveinthecategory.Inthehairstylingcategory,consumers
increasingly purchase products with better performance, keeping pricing as a
secondary factor. Furthermore, negligible TME allocation at less than a million and
increasingcompetitionfromotherleadingbrandsoffsetsitssalesprospectin2012.
Limitednewproductactivityalsorestrictsthebrandsgrowthinthecategory.
SalesoftheAxebrandgrow3.8%from$26millionin2011to$27millionin2012.
In 2012, Unilever supports the brands sales with new product launches: Spiked Up
LookSpikingGlueandSpikedUpLookExtremeHoldingSpray.
Sales of Nexxus and Dove remain stagnant at $32million and $11 million in 2012,
respectively.
SalesofConsortdeclineby$1millionin2012to$11million,from$12millionin2011.
4A352
Unilever
Unilever, the leading marketer in the conditioners category, has a 21.9% share of the
categoryssalesin2012,slightlyupfrom21.3%in2011.
Salesforthemarketergrow7.7%from$336millionin2011to$362millionin2012.
UnileverprimarilybenefitswiththelaunchofanewbrandClearin2012.
Clear has sales of $27 million in 2012, as the brand benefits from its scalp therapy
rangeofconditioners.
ThelargestbrandfromUnileverisSuave,withacategoryshareof6.5%in2012.
Sales for Suave grow 4.9% from $103million in 2011 to $108million in 2012. New
productlaunchesandeconomicallypricedproductscontributetothebrandsgrowth.
TRESemm,thesecondlargestbrandforUnilever,hasanoverallshareof6.5%in2012.
SalesofTRESemmdeclineby1.8%from$109millionin2011to$107millionin2012.
Dove,thethirdlargestbrandforUnilever,hasacategoryshareof4.0%in2012.
Salesforthebranddeclineby2.9%,from$68millionin2011to$66millionin2012.
Minimaladvertisingsupportcontributestothebrandsdeclineinthecategory.
Unilevers youthcentric brand Sunsilk is discontinued in 2012. Diminishing consumer
interestinthebrandresultsinthediscontinuationofthebrand.
The only professional brand marketed by Unilever in the category is TIGI, with the
brandssalesflatat$17million.
Unileveristhefifthleadingmarketerinthehandandbodylotionscategorywithdeclining
salesin2012.
Thecompanyssalesdecline4.3%from$207millionin2011to$198millionin2012.
ThemarketerisrepresentedinthecategorywithitsVaseline,Suave,Dove,andSt.Ives
brands.
Unileveraccountsfor8.7%shareofthetotalcategoryssalesin2012,downfrom9.2%
in2011.
Sales of Vaseline continue to decline in 2012 with sales at $108 million, down 5.3%
VaselineisbackedbyTMEof$41millionin2012,upfrom$28.4millionin2011.The
VaselineIntensiveMoisturelineisthemostadvertisedrangeofproductsforthebrand
with a TME allocation of approximately $20 million in 2012. However, the lack of
freshness in its product portfolio, negligible innovation, and increasing competition
fromotherbrandsresultinsalesdeclineforVaselinein2012.
Suaveisthesecondleadingbrandforthemarketerin2012withsalesat$52million,
down3.7%from$54millionin2011.Despitetheextensionofitshandandbodylotions
lineofproducts,thebrandisnotabletopostgrowthin2012.
SuaveintroducestheEverlastingSunshinefragrancetoitsalreadyexistingbodylotions
productlinein2012.
SalesofSt.Ivesremainstagnantat$32millionin2012,from2011levels.
SalesofDovecontinuetodeclineat14.3%from$7millionin2011to$6millionin2012.
AdeclineinsalesofDoveisduetonegligiblenewproductactivityandnoinnovations
orformulationchangesforthebrandin2012.
Dovehasalimitedpenetrationinthecategorywithonlyfourproducts.
5353
5354
Unilever
Unilever is the secondleading marketer in the ethnic hair care products category with a
shareof11.5%in2012.
Salesforthecompanyremainflatat$39millionin2012,thesameasin2011.
Lackoftechnologicaladvancementsandlimitednewproductactivityaccountforsales
decline for Unilever in 2012. Limited distribution channels, with beauty supply stores
accountingforthemajority,offsetthemarketersgrowthinthecategory.
Thebrandssalesdecline$1millionfrom$15millionin2011to$14millionin2012.
Soft&Beautifulhaspresenceintherelaxerkitsandthestylingaidssegments.
Lackofmarketingandpromotionalactivitieslimitsthebrandsgrowthinthecategory
in2012.
JustForMeandTCBaretiedforsecondplace,withsalesat$8millioneachin2012.
JustForMeisabrandespeciallyformulatedforchildrenintheagegroupof514years.
TCBisaneconomicalhaircarebranddesignedespeciallyforAfricanAmericanwomen.
SalesoftheMotionsbrandgrowby$1million,from$4millionin2011to$5millionin
2012.
Increasingnewproductactivitysupportsthebrandsgrowthin2012.Unileverlaunches
a range of Motions Naturally You products including shampoos, conditioners, and
stylingaidsin2012.
RECENTDEVELOPMENTS
In2012,UnileverisnamedasthesectorleaderintheDowJonesSustainabilityIndexesfor
the14thconsecutiveyear.
LinkedInhasnamedUnileverasthefifthmostdesirablecompanytoworkforin2012.
TheCatalystOrganizationhasrecognizedUnileverforitsworkondiversity.
Also in 2012, Christiansen Davis Bullock, a Texasbased firm files a complaint against
Unilever with respect to a false, deceptive, and misleading claim in connection with the
SuaveProfessionalKeratinInfusion30DaySmoothingKit.
Unileverdiscontinuestheproductandrecallsitfromallretailstores.
Acquisitionsanddivestitures
In 2012, Unilever integrates two acquisitions, Kalina, the Russian Personal Care Company,
andAlbertoCulver,theglobalhairandskincarecompany.
UnileverhasacquiredacontrollingstakeinKalinaforapproximately500million.
The acquisition will help Unilever boost its personal care business in fastgrowing
developingmarkets.
4A354
Unilever
InJuly,2012,UnileverentersintoadefinitiveagreementtosellitsNorthAmericanfrozen
mealbusinesstoConAgraFoods.ThebrandsdivestedareBertollliandP.F.ChangsHome
Menu.
Thetotalcashconsiderationforthedealis$265million.
ThedivestitureiscompletedinAugust2012.
Unilever announces its definitive agreement for the sale of its global Skippy peanut
butterbusinesstoHormelFoodsinJanuary2013.Thetermsofagreementarevalued
at$700million.
MANAGEMENTCHANGES
Thecompanyhasnotmadesignificantchangestoitstopmanagementduring2012.
NEWPRODUCTS
Table5182:SelectNewProductsIntroducedbyUnileverintheUnitedStatesin2012
Brand
Category
Description
Axe
Conditioners
Apollo2in1shampooandconditionercombinescrispfruitanda
creamybackground,therebyrenderingauniquemasculinefragrance
tohair
Axe
Deodorantsand
antiperspirants
AnarchyForHerisacombinationofappleandblackberrynotesatthe
top,softfloralsattheheart,andabaseofsandalwood,amber,and
vanilla
Axe
Deodorantsand
antiperspirants
AnarchyForHimhasAxessignaturefragrancecomprisingfreshand
fruitynotesandnotesofsandalwoodandamber
Axe
Shampoos
Apollo2in1shampooandconditionercombinescrispsparklingfruits,
therebyrenderingauniquemasculinefragrancetohair
Axe
Hairstylingproducts
andsprays
TheGravityDefyingDustgelcontainhumidityresistantformula
Axe
Hairstylingproducts
andsprays
ExtremeSpikeUpHoldSpraykeepsthespikesfortheentireday
Caress
Personalcleansing
products
EndlessKissSilkeningBodyWashisenrichedwithmoisturebeadsand
containsthescentofvanillaandsandalwood
Caress
Personalcleansing
products
PassionateSpellFineFragranceElixirBodyWashisinfusedwiththe
scentofpassionfruitandfieryorangerosetoleavealingering
fragrance
(Continued)
5355
5356
Unilever
Brand
Category
Description
Caress
Personalcleansing
products
SheerTwilightFineFragranceElixirBodyWashisaSilkyFragrance
Infusionofblackorchidandjuniperoil
Clear
Conditioners
TotalCareNourishingDailyconditioner,withitsadvancedcomplexof
vitaminsandnutrientsgentlycleansesandhelpsrestorethescalps
naturalmoisturebalance
Clear
Conditioners
Damage&ColorRepairDailyNourishingconditioner,cleansesgently
andhasadvancedcolorsafeformulathatprovidesprotectionfrom
dailydamage
Clear
Conditioners
VolumizingRootBoostconditionerprovidesspecialnourishingandall
dayvolumefromroottotip
Clear
Conditioners
StrongLengthsDailyConditionercontainsarichstrengtheningserum
tonurtureandprotecthairfrombreakage
Clear
Conditioners
MoisturizingDryScalpconditionercontainsanextrarichformulathat
nourishesdryscalpandhairtorestorenaturalmoisturebalance
Clear
Conditioners
FrizzControlconditionerhasagentlenourishingformulainfusedwith
asmoothingcomplex,provides24hourfrizzcontrol
Clear
Conditioners
UltraSheaconditionercontainsaformulainfusedwithNutritium10
TMMoistureLock,sheabutter,andnaturaloilsthatquenchesdryness
andlocksinmoisture
Clear
Shampoos
ScalpTherapyStrongLengthsNourishingshampoocontains
strengtheningserumandisformulatedwithNutrium10,amoisture
complexofvitaminsandnutrients
Clear
Shampoos
ScalpandHairTherapyCompleteCareAntiDandruffshampoo
nourishesdeeplyandhelpseliminatedandruffsymptoms,leavingthe
scalphealthy
Clear
Shampoos
ScalpandHairTherapyUltraSheaCleanseandNourishShampoois
enrichedwithsheabutterandnaturaloilsthathelpslockmoistureinto
dryscalpandleaveshairstrongandbeautiful
Clear
Shampoos
ScalpandHairTherapyTotalCareNourishingShampoocontains10
nutrientsandvitaminsthatnourishesscalpforstrong,beautifulhair
Clear
Shampoos
ScalpandHairTherapyDamage&ColorRepairNourishingShampoois
speciallyformulatedtonourishthescalpdeeply,creatingtheright
foundationforstrong,beautifulhair
Clear
Shampoos
ScalpandHairTherapyFrizzControlNourishingShampooprovidefrizz
controlandnourishesthehair
ClearMen
Shampoos
ScalpTherapy2in1AntiDandruffShampoocontainsginseng,mint,
andteatree
ClearMen
Shampoos
ScalpTherapyDailyStrongandFullAntiDandruffShampoocontains
BioNutrium10,ablendof10nutrientsandbotanicalactivesto
nourishdeeply
(Continued)
4A356
Unilever
Brand
Category
Description
ClearMen
Shampoos
ScalpTherapyClean&RefreshAntiDandruffDailyShampoohelps
eliminatedandruffsymptomsatthesourcewithpyrithionezinc
ClearMen
Shampoos
ScalpTherapyCoolSportMintAntiDandruffDailyShampoocontains
naturalmintandcleansesscalpandhair,leavinganextracooling
sensation
ClearMen
Shampoos
ScalpTherapy2In1DryScalpHydrationAntiDandruffShampoo
gentlycleansesandconditionstoleavehairmanageablewithadeep
cleansensation
Degree
Deodorantsand
antiperspirants
ExpertProtectionLinenDrywithMotionsensetechnologyisinfused
withafloralgreenscenttoprovidefreshness
Degree
Deodorantsand
antiperspirants
ClinicalProtectionCottonFreshwithMotionsensetechnologyis
infusedwiththefragranceofwhiterosepetalsandjasmineandoffers
odorprotectionthroughouttheday
Degree
Deodorantsand
antiperspirants
NatureEffectsInvisibleSolidAbsorbentSeaSaltisablendofginger,
mint,andteaforlonglastingprotection
Dove
Deodorantsand
antiperspirants
ClearToneSkinRenewDeodorantprovides24hourodorandwetness
protection,helpsreducedarkmarks,providesanevenskintone,and
designednottoleavewhitemarks.ItisavailableinSkinRenew
InvisibleSolid,SheerTouchInvisibleSolid,andClinicalProtectionSkin
Renew
DoveMen+Care
Personalcleansing
products
FreshAwakeBody&FaceWashwithMicromoistureTechnologygets
activatedonceincontactwiththeskinandisclinicallyproventofight
skindryness
DoveMen+Care
Personalcleansing
products
CleanDefenseBody&FaceWashwithMicromoistureTechnologygets
activatedonceincontactwiththeskintoremoveoilbuildupand
maintaintheskinsmoisturelevels
Dove
Shampoos
TheDamageSolutionsColorCareshampoocleansandconditionscolor
treatedhair
Motions
Ethnichaircare
products
MoisturizingCleansercontainssheabutter,coconut,andavocadooils
Motions
Ethnichaircare
products
SmoothingConditionersoftensandnourisheseventhemost
unmanageablecurls,infusedwithingredientssheabutter,coconut,
andavocadooils
Motions
Ethnichaircare
products
RadiatingGlossprovidesanaturalandevenluster,containsshea
butter
Motions
Ethnichaircare
products
DefineMyCurlsisarichgelthatenhancesmoisturetodeliverthe
ultimatesoft,separatedcurls
Motions
Ethnichaircare
products
HydratemyCurlshydratesandlightlydefinescurls,whilereducing
frizz
Motions
Ethnichaircare
products
DeepConditioningMasquecontainssheabutter
(Continued)
5357
5358
Unilever
Brand
Category
Nexxus
Conditioners
Ponds
Facialtreatments
Simple
Facialtreatments
Suave
Personalcleansing
products
Suave
Shampoos
Suave
Conditioners
TRESemm
Conditioners
TRESemm
Shampoos
TRESemm
TRESemm
TRESemm
TRESemm
TRESemm
Hairstylingproducts
andsprays
Hairstylingproducts
andsprays
Hairstylingproducts
andsprays
Hairstylingproducts
andsprays
Hairstylingproducts
andsprays
Description
FrizzDefyconditionercontainsMoroccanarganoilandcoconut
extract,thathelpcreatesmoothstylesandcontrolfrizzallday
LuminousCleanCreamCleansercontainswhitekaolinclay,anatural
mineralknowntoactlikeamagnettodrawoutdeepdwelling
impurities,andmoisturizingingredientssuchasglycerintohelpleave
skinsoftandsmooth
AfacialtreatmentlinenewtotheUnitedStatescontainingnodyes,
artificialperfumes,orharshirritantsandishypoallergenic,non
comedogenicandpHbalanced.Linecontainscleansers,wipes,
moisturizers,andproductsforusearoundtheeyearea
EverlastingSunshineBodyWashisenrichedwithvitaminEandthe
scentofpassionflowerandvanilla
DailyclarifyingshampooisapHbalancedshampoo,thathasnew
formulaforlongerlastingfragranceandissuitableforbothnormalas
wellasoilyhair
DailyclarifyingconditionerisapHbalancedconditioner,thatlightly
nourisheshairaftershampoo,andissuitableforbothnormalaswell
asoilyhair
SplitRemedyconditionerconditionsandmoisturizeshairstrandwhile
bindingupto80%ofsplitends
TheSplitRemedyshampoocontainsamoisturizingformulathatgently
cleansesandstrengthenshair
ThePlatinumStrengthHeatProtectSprayfortifiesandstrengthenshair
Illuminatesshine
Illuminatesshine
The24HourBodyhairspraycontainsasalonqualityformulathat
resistshumidityandfightsfrizz
TheNourishingRitualsRejuvenatingMasquecontainsdeadsea
minerals
MARKETINGACTIVITY
UnileversupportsitsbrandswithagenerousTMEof$522.3millionin2012,up14.0%from
$458.3millionin2011,spreadacrossalladvertisingmediaincludingtelevision,print,cable,
andtheInternet.
Thecompanysinitiativetonegotiateadvertisingandmarketingdealsdonegloballyin
order to customize them for the local regions and countries, helps in achieving
economiesofscale.
Unilever capitalizes on wordofmouth as an important means of communicating the
benefitsofitsproducts.
4A358
Unilever
Dove, the marketers leading brand, represents 18.1% of Unilevers total TME at
$94.3millionin2012.
Majorityoftheadvertisingdollars,at$60.1millionor63.7%ofthebrandstotalTMEis
spentontelevisionadvertisements.
Doveswebsiteofferssamplesandcoupons.
Doveswebsitealsoallowsconsumerstosignupforitsnewslettertherebyhelpingthe
brandcommunicateitslatestpromotionsandoffers.Doveswebsitealsooffersspecial
beauty advices and tips to its consumers. The brands website also interacts with its
customersthroughvideos,quizzes,andgames.
Doveaddressestheissueofselfesteem,oneofthebiggestissuesfacedbyadolescent
girls around the world. The Dove Self Esteem Project, which encourages girls and
women to develop a positive relationship with beauty, has been successful in driving
growthforthebrand.
Dove spreads awareness about the SelfEsteem Weekend and its other social
initiatives through the social mission tab on its website. It also offers discount
couponsandallowsconsumerstoregisterfortheDovenewsletter,alsoknownasthe
DoveInsideronitswebsite.
TheDoveDeepMoistureBodyWashreceivesthemostTMEat$41.6millionin2012.
The Dove Deep Moisture Body Wash is enriched with a proprietary ingredient
NutriumMoisture, which claims to provide effective moisturization, to nourish skin
deepdown.
Doves Beauty Bar receives a TME of $18.3 million, while Dove Men+Care Bar Soaps
receiveaTMEof$2.7millionin2012.
DovesnewClearToneSkinRenewDeodorantisallocatedaTMEof$14.7million,while
theDoveGoSleevelesslineofproductsisallocatedaTMEof$15.9million.
DoveMen+Caresmarketingprimarilyrevolvesaroundsportspersonalitiesandsports.
In2012,UnileverpromotesitsDoveMen+CarelinethroughtheJourneytoComfort
campaign.
UndertheJourneytoComfortcampaign,thecompanyteamsupwithbasketballstars
ShaquilleONeal,SteveNash,andMichiganStateUniversityHeadCoach,TomIzzo.The
campaign gives sports fans a glimpse into their professional and personal lives, by
sharing unique stories and events that changed their lives, lessons learnt from their
familyandcoaches,andstrugglesenduredtoachievetheirgoalsintheformofvideos.
DoveMen+CareFacebookpageinitiatestheShaqsBigExcuseFacebookapplication,
whichallowsfanstosendcustomizedmessagestoacquaintancesandfriends.
Dove Men+Care also collaborates with Viggle, an application that allows fans who
checkintoNCAAbasketballgameswithinViggle,withachancetoearnextrapointsby
watchingtheJourneytoComfortvideos.
DoveMen+CareisthetitlesponsoroftheDad2.0Summit.Thesummithasaseriesof
eventswherebyapanelofspeakerspresentanumberofissuespertainingtothelives
of men including the importance of fatherhood. The brand offers men the chance to
havealivediscussionwithformerprofessionalfootballstar,DougFlutiebyloggingon
tothebrandsFacebookpagein2012.
Dove Men+Care also organizes a number of contests, such as the Fan Bowl Photo
Challengewiththeluckyparticipantsgettinganopportunitytowinprizesthroughout
theNCAAFootballSeason.
5359
5360
Unilever
In2012,AxereceivesaTMEofapproximately$72million,withthemajorityofthebrands
TMEat$59.4millionallocatedtowardstelevisionadvertisements.
In 2012, Unilever unleashes an online advertisement campaign for its Axe brand that
urgescollegestudentstoshowerwithafriendoranattractivestrangerinanattempt
toconservewater.Themarketercoinsthetermshowerpoolingforitscampaign.The
Showerpooling campaign encourages sustainable living routine with tongue in cheek.
The marketer introduces a few videos, with some featuring brand ambassador and
actress Nicki Reed as the narrator. The brand also distributes 7,000 waterefficient
DeltashowerheadswithH20KineticTechnologyduringitscampustouranddonates
$100,000 to the Alliance for Water Efficiency, a nonprofit organization dedicated to
theefficientandsustainableuseofwater
Axewasadvertisingitsproductbenefitsasgivingmentheedgeinthematinggame.
However, with the launch of the Axe Anarchy product, the marketer seems to be
changingthebrandsimagewiththeAxeAnarchysadvertisementfeaturingamanand
a woman walking towards each other passionately while the world collapses around
them, using the tag line Unleash the chaos. New Axe Anarchy for him and for her.
Thiscampaignnowsuggeststhatmenandwomenareequallyinvolvedinthecourting
process. The marketer launches a teaser campaign called Axe: Anarchy is Coming
which involves a graphic novel with consumers suggestions incorporated and some
beingdepictedinacomicroleplay.Thetelevisionadvertisementcampaignstartsearly
2012withsupportfromdigitalandoutdooractivity
One of the Axe brands campaigns, called the Axe Lounge, is hosted in Dallas. The
campaign,withitsbaseintheRioRoominDallas,includesperformancesbyGrammy
AwardnomineeCeeLoGreen,DJVice,Diplo,JermaineDupri,andothers.
Alsoleveragingitspresenceintheonlineandmobilemedia,thecompanylaunchesthe
AxeTwistRoulette,whichisabrandedapplicationforApplesiPhoneandiPodtouch.
Furthermore,anewWebbasedwidgetcalledtheAxeSprayaway,whichwheninstalled
ontheuserscomputercanbeusedtoblockunwantedwebcontent.
InordertopromotetheAxeshowerrange,thebrandhasanewtagline,TheCleaner
You Are, The Dirtier You Get and is also introducing a fourpart Web series in
association with Comedy Central Digital. The show has actor/comedian Rob Riggle as
host and pits coed teams against one another in challenges designed to get them as
messyaspossiblewithin90seconds.
4A360
Unilever
Unilever overtakes Procter & Gamble to become the leading advertiser in the personal
cleansingproductscategoryin2012.
TheTMEofthemarketerisat$85.2millionwith$46.9millionor55.0%ofitstotalTME
spentontelevisionadvertising.
Dove, the leading brand of the marketer, accounts for 91.1% of the marketers total
TMEin2012.WithaTMEallocationof$41.6millionor48.8%ofthecompanystotal
TME,theDoveDeepMoisturebodywashisallocatedthehighestTMEin2012.
The marketer comes out with the Dove Truth Files game where consumers are
supposedtoputtheirbarsoapandbodywashtotestforachancetowingiftcardsand
cashprizes.
Axes personal cleansing products receive a TME of $2.4 million in 2012, down
aggressivelyfrom$9.5millionin2011.Axeispromotedinmagazinesandthecompany
allocates$2.0millionor83.3%ofthebrandstotalTMEtomagazineadvertising.
In2012,UnileveradvertisesitsAxebrandinacontroversialonlinecampaignthaturges
college students to conserve water by showering with a friend or an attractive
stranger,aconceptthatthemarketertermsshowerpooling.
In2012,AxeteamsupwithmodelKateUptonandprofootballplayerJasonPierrePaul
to promote its newly launched Axe Sport Blast 2in1 shower gel and shampoo. Kate
Upton and Jason PierrePaul host the Axe Sport Blast Combine House, a competitive
partyspacewherethetwosquareoffinaseriesofchallenges.
In addition to television and magazine advertisements, social media also plays an
important role in promoting the marketers offers, discount coupons, or any new
productsintroductions.
Unilever continues to be the leading advertiser in the deodorants and antiperspirants

categorywithTMEof$134.6millionin2012,up11.4%from$120.8millionin2011.
UnileversDegreebrandisthemostadvertisedbrandwithinthemarketersportfolioof
deodorantsandantiperspirantsin2012.
Degreereceivesadvertisingsupportof$56.9millionin2012.
Dovereceivesthesecondhighestadvertisingexpenditureat$49.8millionin2012.The
combinedTMEofDoveGoSleevelessandDoveClearTonetotals$30.7million.
Unilever further reduces the advertising expenses of its Axe brand in 2012 to
$27.9million,adeclineof1.1%from$28.2millionin2011.
Withanallocationof72.1%ofthetotalTME,televisionadvertisementsarethemost
importantmeansofadvertisingadoptedbythemarketer.
Secondleadingmarketerintheshampooscategory,UnileverhasaTMEof$103.3millionin
2012,upsignificantlyby94.9%from$53.0millionin2011.
Themarketersignificantlyspends$55.4milliontopromoteitsClearbrandin2012.
In2012,TMEsforUnileversleadingbrandSuaveare$19.4millionandTRESemmhas
aTMEof$11.6million.
Approximately$78.3millionor75.7%ofthetotalTMEisspentontelevisionadvertising,
followedbymagazineadvertisingwith$19.2million.
5361
5362
Unilever
Unilever is the leading advertiser in the hair styling products category with a TME of
DoveStyleCarerangeisthehighestadvertisedhairstylingvariantfromUnilever,with
aTMEsupportofover$17.6millionin2012.
Dove receives a TME support of $22.5 million or 57.3% of the marketers advertising
expenditurein2012.
Axe receives only $5.4 million or 13.7% of the marketers advertising expenditure in
2012.
Unilever has the secondhighest media spending in the conditioners category. Unilevers
advertisingspendingonpromotingitsconditionersis$12.6million.
Approximately,55.8%or$7.6millionisspentonpromotingitsDovebrand.
In the hand and body lotions category, Unilever endorses its Vaseline brand with nearly
$41millioninTME,with54.9%at$22.5millionspentonmagazineadvertisements.
UnileverusestheInternettosharenewsaboutitsproducts,educateconsumersaboutits
products, offer coupons, and instantly establish a rapport with the consumers by offering
additionalactivitiessuchasgamesormultimediaapplications.
The marketer also employs the use of social media to interact with consumers, share
information about new products, information about brand ambassadors, and organizes
eventstopromoteitsproductlaunches.
The usage of social media also allows consumers to ask questions and give opinions
aboutaproductthattheyhaverecentlyused.
OUTLOOK
Unileverisexpectedtopostmodestgrowthof2.7%overtheforecastperiod,2012to2017.
Unileverexperiencesastrongyearin2012,buildingonitsgoodperformancein2011.
Unilever will continue to strengthen its management team by appointing employees
basedontheirexperience,skills,backgrounds,knowledge,andinsights.
Thecompanywillcontinuetostrengthenitsportfolioofbrandsbyperformingstrategic
acquisitionsanddisposingunprofitablebusinesses.
Continuous introductions of impactful innovations will be a key growth driver for
Unileverduringtheforecastperiodending,2017.
The company will continue to make efforts towards transforming Unilever into a
sustainablecompany.
4A362
Unilever
Unileverwillcontinuetobenefitfromitsstrongrelationshipwithitsretailers,ensuring
smooth movement of its brands from retail shelves. The marketer benefits from
consumers loyalty to its brands, which will help Unilever increase its sales over the
next five years. Further, Unilevers Onshelf availability measures the product
availabilityontheshelfandensuresthattheproductisavailablewhileconsumersare
shoppinginretailoutlets.
Efforts will be directed toward improving the supply chain efficiencies while keeping
costscompetitive.
Thecompanyisexpectedtotakenaturalproductsseriouslywithsomeofitsbrands
implementingnaturalformulationswhiletakingintoaccountcostandavailability.
The marketer will continue to support its brands with aggressive media and
promotionalactivity.
Thecompanywillcontinuetofocusondevelopingandstrengtheningitsstrongbrands.
Innovationwillbethekeydriverindevelopingthesebrands.
Unilever will also continue to invest in brand equity in order to strengthen the
connectionsbetweenconsumersanditsbrands.
Innovating with superior products that appeal to the consumers would be of prime
importancetothemarketer.
Itwillcontinuetofocusondevelopingitspremiumportfolioofbrandsacrossvarious
personalcarecategories.
It is expected to continue to elevate the brand image of Dove as a supporter of all
women and their self esteem, as evidenced with the continuation of its Real Beauty
campaignin2013.Unileverhiresaforensicsketchartisttodrawwomenbytheirown
descriptions of themselves, and then again by someone elses description. By
comparingthetwodrawings,themessageisyouaremorebeautifulthanyouthink.
Thevideogoesviralwhenitreleased.
Unileverisexpectedtoachievesustainablegrowthduringtheforecastperiod,2012to2017.
Thecompanyisexpectedtoreducegreenhousegasimpactonitsproducts.
Unileverislikelytohalvethewasteassociatedwiththedisposalofitsproducts.
By 2020, the marketer is expected to source 100% of its agricultural raw materials
sustainably.
In2012,UnileverteamsupwithU.S.basedenvironmentalresearchcompanyEarth911
to determine whether or not, the millions of deodorant sticks that are thrown away
each year, can be recycled. The companies also utilize the help of students from 50
schoolsandcollegestocollectuseddeodorantsticksthatcanbetestedforrecycling.
5363
5364
Unilever
The company is expected to strengthen its R&D efforts over the course of the forecast
period.
Unilevers six major laboratories located across the world in conjunction with its
regional center in the United States will help it discover its potential to innovate
through2017.
During the course of the next year, the company will expand manufacturing at its
productionfacilityatRaeford,NC.Theinvestmentintheproductionfacilitywillamount
to $29.9 million and will be developed with the aim of meeting increasing
manufacturingcosts.Theexpansionwillalsoresultinthecreationof21newjobposts.
Unileverwillcontinuetoaccelerateitspresencebywideningitsdistributionnetwork.
Thethreechannelswhichhavedemonstratedgoodgrowthin2012includedrugstores,
ecommerce,andoutofhome.
Thecompanyplanstoexpanditsdistributionnetworkbyincreasinglypartneringwith
retailers.
Unilevers acquisition of AlbertoCulver towards the end of 2010 helps the hair care
businessgrow.
The acquisition has expanded the companys hair care brands portfolio with the
inclusionofrenownedbrandssuchasTRESemm,Simple,andVO5.
Unilevers personal care portfolio, which is focused towards hair care and other toiletries
productclasses,isprojectedtoshowconsiderablegrowthduringtheforecastperiod.
Increasedproductpricing,asaresultoftheaddedbenefitsandadvancedtechnology,
incategorieslikedeodorantsandantiperspirants,skincare,andhaircare,willfurther
aidsalesgrowth.
Unileverwillcontinuetocapitalizeonitsflagshipbrand,Dove,whichbenefitsfromits
strong brand loyalty among the women consumers, seeking moisturizing as a key
benefitinpersonalcareproducts.
Unilever will continue to gain from the strong brand loyalty for its brands which will
benefititinthecomingyears.
However,thelackofnewproductlaunchesorinnovationcanseriouslydampengrowth
prospectsforUnilever.
The personal cleansing category, the strongest category for Unilever, is projected to
continuetodevelopduringtheforecastperiod.
Thecompanyisexpectedtocontinuetostrengthenitsmajorbrandsinthecategory,
Dove,Caress,Axe,andSuave,bywideningthechoiceofproductsavailable,freshenthe
portfolioofproducts,andmeetcompetingmarketersinthecategory.
Innovationinthematurecategoryisofkeyimportanceforthecompanytoattainsales
in the category. Innovation can be in the form of bright, colorful, and attractive
packagingandadditionalbenefitssuchasmoisturizing,whichwillhelpdrivegrowthfor
thecompanyinthefuture.
4A364
Unilever
Thematuredeodorantsandantiperspirantscategorywillbeanotherkeypointofsalesfor
thecompanyduringtheforecastperiod.
Dove has done particularly well in 2012, and is likely to continue its healthy growth
through the forecast period, mainly due to the good performance of its Dove
Men+Carelineofproductsthataretargetedtowardsmen.
Axe,anotherleadingbrandforthecompany,willcontinuetogrowanddowellwithits
targetaudiencebeingtheyoungergenerationofmen.
TheintroductionofAnarchyforHerin2012sparksinterestamongwomentotrythe
limitededitionbodyspray.Thecompanyislikelytocomeoutwithalineofbodysprays
anddeodorantsforwomenduringtheforecastperiod.
Unileverisshowingstrongsignsofgainingafootholdinthegrowingmalegroomingmarket.
Thecompanysmalecentricbrands,AxeandDoveMen+Care,aredoingwellin2012
andwillcontinuewiththeirgrowththroughtheforecastperiod.
Vaseline,oneofthefewmassbrandsintheskincareformencategorydominatedby
prestigebrands,willattempttomakeamarkinthecategory.
ThehaircareproductclasswillemergestrongerforUnileverduringtheforecastperiod.
TheacquisitionofAlbertoCulverhassolidifiedthecompanyspositioninthehaircare
productclass.ItwilladdstrengthtoUnileverscurrentproductportfolio.
AlbertCulversbrandsacquiredbyUnileverTRESemmandNexxusaresomeofthe
leadingnamesinthehaircaremarketandwillprovidethecompanywithanextensive
portfolioofproducts.
Thisadvantageislikelytoincreasesalesandmoreinnovativeentriesofnewerproducts
byUnilever.
Salesareexpectedtogrowextensivelyinthehaircareproductclass,asthecompany
providesitsconsumerswithawiderangeofproductscoveringdifferentpricepoints.
ManufacturerssalesforUnileverscosmeticsandtoiletriesareforecasttogrowatCAGRof
2.7%toreach$4,051millionby2017,upfrom$3,546millionin2012.
5365
5366
Unilever
ToiletriesforUnileverbyProductCategory,2012to2017
Productcategory
CAGR,%
5.9
3.2
3.1
Shampoos
2.9
2.9
COMPANYAVERAGE
2.7
Facialtreatments
2.6
Conditioners
2.5
1.5
Fragrancesforwomen
1.4
Handandbodylotions
1.2
0.5
Fragrancesformen
Shavingproducts
4A366
Advertising
SectionSeven
ADVERTISING
SectionSevenof
ContinuingService
CARRIEMELLAGE
KlineMarketResearch
+19734353412
SPECIALNOTICE


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employees of subscribing companies and their subsidiaries, as defined above, until June 15,
2016.Similarly,allsectionsofthesurveyaresorestrictedforthreeyearsfromtheirdatesof
issue. Failure to prevent unauthorized disclosure before these dates will result in legal action
againstthesubscriber.
Kline&Company,Inc.
Servingthe
Strategicanalyses
4A4
TABLEOFCONTENTS
Page
INTRODUCTION....................................................................................................................71
Scope................................................................................................................................71
Source..............................................................................................................................71
Format..............................................................................................................................71
THEPRODUCTS.....................................................................................................................77
Introduction.....................................................................................................................77
Babycareproducts..........................................................................................................77
Conditioners.....................................................................................................................77
Dentureproducts.............................................................................................................78
Deodorantsandantiperspirants......................................................................................78
Depilatories,waxes,andbleaches...................................................................................78
Ethnichaircareproducts.................................................................................................79
Eyemakeup......................................................................................................................79
Facemakeup....................................................................................................................79
Facialtreatments...........................................................................................................710
Fragrancesformen........................................................................................................710
Fragrancesforwomen...................................................................................................710
Haircareproductsmultiproduct...............................................................................711
Haircoloringproducts...................................................................................................711
Hairstylingproductsandsprays....................................................................................711
Handandbodylotions...................................................................................................712
Lipbalms,jellies,andtreatments..................................................................................712
Lipsticksandlipglosses..................................................................................................712
Mouthwashes................................................................................................................713
Nailpolishes...................................................................................................................713
Personalcleansingproducts..........................................................................................713
Shampoos.......................................................................................................................714
Shavingproducts............................................................................................................714
Skincareproductsformen............................................................................................714
Suncareproducts..........................................................................................................715
Toothbrushes.................................................................................................................715
Toothpastes...................................................................................................................715
Toothwhiteningproducts.............................................................................................716
Othercosmeticsandtoiletries.......................................................................................716
TABLEOFCONTENTS
(Continued)
Page
MAJORCOMPANIES...........................................................................................................717
Introduction...................................................................................................................717
Alticor.............................................................................................................................717
Avon...............................................................................................................................717
Beiersdorf.......................................................................................................................718
Chanel............................................................................................................................718
Church&Dwight............................................................................................................718
Clarins.............................................................................................................................719
ColgatePalmolive..........................................................................................................719
Combe............................................................................................................................719
Coty................................................................................................................................720
ElizabethArden..............................................................................................................720
EnergizerHoldings.........................................................................................................720
EsteLauder...................................................................................................................721
GlaxoSmithKline.............................................................................................................721
GuthyRenker.................................................................................................................721
HelenofTroy..................................................................................................................722
Henkel............................................................................................................................722
Johnson&Johnson........................................................................................................722
Kao.................................................................................................................................723
LimitedBrands...............................................................................................................723
LOral............................................................................................................................724
LVMH..............................................................................................................................724
MaryKay........................................................................................................................724
Merck.............................................................................................................................725
Procter&Gamble..........................................................................................................725
Revlon............................................................................................................................726
Sanofi.............................................................................................................................726
Shiseido..........................................................................................................................727
TheCloroxCompany......................................................................................................727
Unilever..........................................................................................................................728
4A2
INTRODUCTION
SCOPE
TheAdvertisingsectionofCosmetics&ToiletriesUSAconsistsofmediaspendingdatareported
for product categories and major companies, profiled in sections four and five of this report,
respectively.Asummaryoftraceablemediaexpenditures(TME)andU.S.salesofcosmeticsand
toiletries by company and by category are shown in Table71, Table72, Table73, and
Table74.
SOURCE
AdvertisingexpendituresarebasedonKline&Companysanalysisofadspendingdatasourced
primarily from Kantar Media and Publishers Information Bureau, who copyright this service.
Thefollowingmediaoutletsaretracked:
Television(TVnetwork,spot,cable,syndicated)
Magazines
Outdoor
Newspapers
Radio
Internet
FORMAT
Products
Asixyearsummaryofadspendingandsalesdataisprovidedforthe26cosmeticsandtoiletries
categories,includingaratioofTMEtosales.
Two special advertising analyses are included. The first analysis, hair care products multi
products, details media dollars for complete hair care lines or two or more products. The
other cosmetics and toiletries advertising summary presents media expenditures for those
productsthatcannotbedesignatedtoanyofthe26categoryspecificanalyses.
12
Introduction
Fragrance advertisements that feature both mens and womens fragrances are reported
mainlyinthefragrancesforwomencategory.
Table71:ProductCategoriesRankedbyTraceableMediaExpenditures,2012
Category
$Million
%Oftotal
1,334
21.2
Shampoos
446
7.1
Facemakeup
438
6.9
Eyemakeup
379
6.0
Toothpastes
338
5.4
Fragrancesforwomen
325
5.2
322
5.1
Handandbodylotions
297
4.7
297
4.7
277
4.4
255
4.0
Nailpolishes
240
3.8
224
3.6
165
2.6
154
2.4
Fragrancesformen
135
2.1
Conditioners
119
1.9
Mouthwashes
105
1.7
Suncareproducts
80
1.3
79
1.3
Dentureproducts
61
1.0
57
0.9
Babycareproducts
55
0.9
Toothbrushes
42
0.7
33
0.5
Shavingproducts
31
0.5
16
0.3
6,305
100.0
Facialtreatments
Total
4A2
Introduction
Table72:LeadingCosmeticandToiletryCompaniesRankedbyTraceableMedia
Expenditures,2012
Company
$Million
L'Oral
1,448
23.0
Procter&Gamble
1,217
19.3
Unilever
522
8.3
Johnson&Johnson
440
7.0
EsteLauder
386
6.1
GuthyRenker
304
4.8
Coty
283
4.5
Revlon
161
2.6
Kao
131
2.1
GlaxoSmithKline
130
2.1
ColgatePalmolive
110
1.7
LVMH
90
1.4
Chanel
87
1.4
Church&Dwight
66
1.0
ElizabethArden
57
0.9
Shiseido
52
0.8
Sanofi
51
0.8
Combe
39
0.6
EnergizerHoldings
33
0.5
Clarins
27
0.4
Beiersdorf
26
0.4
MaryKay
18
0.3
Merck
18
0.3
Avon
13
0.2
Alticor
12
0.2
HelenofTroy
12
0.2
TheCloroxCompany
10
0.2
Henkel
0.1
LimitedBrandsa
555
8.8
6,305
100.0
Allother
Total
aTMEdatanegligible.
%Oftotal
13
14
Introduction
Table73:TraceableMediaExpendituresofCosmeticandToiletryProductCategoriesRankedby
Category
$Million
$Million
%Ofsales
Nailpolishes
662
240
36.3
163
57
35.0
271
79
29.2
1,317
297
22.6
1,377
277
20.1
Facialtreatments
6,645
1,334
20.1
Toothpastes
1,749
338
19.3
Dentureproducts
318
61
19.2
Babycareproducts
288
55
19.1
Shampoos
2,620
446
17.0
Facemakeup
2,909
438
15.1
Eyemakeup
2,709
379
14.0
799
105
13.1
Handandbodylotions
2,283
297
13.0
Fragrancesformen
1,101
135
12.3
Fragrancesforwomen
2,717
325
12.0
2,040
224
11.0
1,680
165
9.8
169
16
9.5
374
33
8.8
Shavingproducts
373
31
8.3
Suncareproducts
1,048
80
7.6
Conditioners
1,653
119
7.2
741
42
5.7
4,026
154
3.8
340
0.3
322
255
Total
40,372
6,305
aSalesincludedinvariouscategories.
bAdjustedtoexcludehaircaremultiproducttoavoiddoublecounting.
15.6
Mouthwashes
Toothbrushes
4A4
Introduction
Table74:TraceableMediaExpendituresofLeadingCosmeticandToiletryCompaniesRankedby
Company
U.S.salesofcosmeticsand
toiletries,$million
$Million
%Ofsales
GuthyRenker
737
304
41.2
GlaxoSmithKline
407
130
31.9
4,551
1,448
31.8
337
90
26.7
1,086
283
26.1
Sanofi
197
51
25.9
Kao
525
131
25.0
Combe
157
39
24.8
2,020
440
21.8
313
66
21.1
5,824
1,217
20.9
Revlon
814
161
19.8
ElizabethArden
290
57
19.7
Chanel
461
87
18.9
Clarins
171
27
15.8
Unilever
3,546
522
14.7
EsteLauder
2,722
386
14.2
ColgatePalmolive
1,493
110
7.4
Shiseido
542
52
9.6
Merck
209
18
8.6
EnergizerHoldings
396
33
8.3
HelenofTroy
147
12
8.2
Beiersdorf
344
26
7.6
Alticor
176
12
6.8
TheCloroxCompany
172
10
5.8
1,063
18
1.7
Avon
948
13
1.4
Henkel
635
1.1
LimitedBrandsa
1,785
Allother
8,304
555
6.7
40,372
6,305
15.6
L'Oral
LVMH
Coty
Johnson&Johnson
Church&Dwight
Procter&Gamble
MaryKay
Total
aTMEdatanegligible.
15
16
Introduction
Companies
Similar to the product ad spending section, TME and cosmetics and toiletries sales data are
reported here for 2007 through 2012 for 29 major companies. In cases where companies or
brandshavechangedownership,arenewlyformed,orhaverecentlybecomeamajorplayerin
thecosmeticsandtoiletriesindustry,historicaldatamaybelimited.
Unless otherwise stated, acquisitions and divestitures are incorporated into the current year
only.Historicalsalesandtraceablemediaexpendituresgenerallyonlyreflectbrandsownedby
thatcompanyatthetime.
4A6
THEPRODUCTS
INTRODUCTION
The following pages provide summaries of ad spending and sales data for the 26 product
categoriesprofiledinthisreport.
Pleasenotethatnumbersinallthetablesbelowarerounded.
BABYCAREPRODUCTS
Table75:TraceableMediaExpendituresforBabyCareProducts,
2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
286
39
13.6
2008
278
3.2
2009
278
29
10.4
2010
278
40
14.4
2011
283
39
13.8
2012
288
55
19.1
CONDITIONERS
Table76:TraceableMediaExpendituresforConditioners,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
1,561
109
7.0
2008
1,561
45
2.9
2009
1,497
44
2.9
2010
1,525
76
5.0
2011
1,578
41
2.6
2012
1,653
119
7.2
rRestated.
78
TheProducts
DENTUREPRODUCTS
Table77:TraceableMediaExpendituresforDentureProducts,2007
to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Sales
320
320
319
320
314
318
%TMEofsales
11.6
8.5
11.9
12.5
20.4
19.2
TME
37
27
38
40
64
61
Table78:TraceableMediaExpendituresforDeodorantsand
Antiperspirants,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Sales
1,869
1,909
1,911
1,942
1,999
2,040
TME
339
295
276
269
220
224
%TMEofsales
18.1
15.5
14.4
13.8
11.0
11.0
Table79:TraceableMediaExpendituresforDepilatories,Waxes,and
Bleaches,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Sales
136
139
138
135
144
163
TME
40
37
22
26
34
57
%TMEofsales
29.4
26.8
15.9
19.4
23.6
35.0
4A8
TheProducts
Table710:TraceableMediaExpendituresforEthnicHairCare
Products,2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
316
305
314
328
333
340
TME
27
23
7
20
6
1
%TMEofsales
8.5
7.5
2.2
6.1
1.8
0.3
rRestated.
EYEMAKEUP
Table711:TraceableMediaExpendituresforEyeMakeupProducts,
2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
2,133
2,200
2,304
2,431
2,621
2,709
TME
198
244
278
348
418
379
%TMEofsales
9.3
11.1
12.1
14.3
15.9
14.0
rRestated.
FACEMAKEUP
Table712:TraceableMediaExpendituresforFaceMakeup
Products,2007to2012
$ Million
Salesr
2,507
2,537
2,549
2,655
2,804
2,909
Year
2007
2008
2009
2010
2011
2012
TME
247
317
242
349
431
438
%TMEofsales
9.9
12.5
9.5
13.1
15.4
15.1
rRestated.
79
710
TheProducts
FACIALTREATMENTS
Table713:TraceableMediaExpendituresforFacialTreatments,2007
to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Sales
5,762
5,923
5,859
6,091
6,360
6,645
TME
901
844
854
1,169
1,221
1,334
%TMEofsales
15.6
14.2
14.6
19.2
19.2
20.1
FRAGRANCESFORMEN
Table714:TraceableMediaExpendituresforFragrancesforMen,
2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Sales
1,180
1,108
1,010
1,024
1,063
1,101
TME
199
184
188
176
205
135
%TMEofsales
16.9
16.6
18.6
17.1
19.3
12.3
FRAGRANCESFORWOMEN
Table715:TraceableMediaExpendituresforFragrancesfor
Women,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Sales
2,706
2,546
2,379
2,444
2,612
2,717
TME
401
372
285
467
455
325
%TMEofsales
14.8
14.6
12.0
19.1
17.4
12.0
4A10
TheProducts
HAIRCAREPRODUCTSMULTIPRODUCT
Table716:TraceableMediaExpendituresforHairCareProducts
MultiProduct,2007to2012
Year
2007
2008
2009
2010
2011
2012
$ Milliona
Salesr
5,585
5,563
5,405
5,536
5,737
5,953
TME
499
438
109
129
232
255
%TMEofsales
8.9
7.9
2.0
2.3
4.0
4.3
aIncludesconditioners,shampoos,andhairstylingproductsandsprays.
rRestated.
Table717:TraceableMediaExpendituresforHairColoringProducts,
2007to2012
Year
2007
2008
2009
2010
2011
2012
$ Million
Salesr
1,277
1,291
1,257
1,280
1,323
1,317
TME
277
295
227
293
339
297
%TMEofsales
21.7
22.9
18.1
22.9
25.6
22.6
rRestated.
Table718:TraceableMediaExpendituresforHairStylingProducts
andSprays,2007to2012
Year
2007
2008
2009
2010
2011
2012
$ Million
Salesr
1,713
1,695
1,632
1,650
1,658
1,680
TME
186
123
82
184
236
165
%TMEofsales
10.9
7.3
5.0
11.2
14.2
9.8
rRestated.
711
712
TheProducts
HANDANDBODYLOTIONS
Table719:TraceableMediaExpendituresforHandandBodyLotions,
2007to2012
Year
2007
2008
2009
2010
2011
2012
$ Million
Salesr
2,160
2,172
2,192
2,208
2,240
2,283
TME
384
311
267
230
276
297
%TMEofsales
17.8
14.3
12.2
10.4
12.3
13.0
rRestated.
Table720:TraceableMediaExpendituresforLipBalms,Jellies,and
Treatments,2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
337
351
342
347
357
374
TME
28
34
40
33
27
33
%TMEofsales
8.3
9.7
11.7
9.5
7.6
8.8
rRestated.
Table721:TraceableMediaExpendituresforLipsticksandLip
Glosses,2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
1,397
1,311
1,252
1,248
1,352
1,377
TME
236
170
193
217
265
277
%TMEofsales
16.9
13.0
15.4
17.4
19.6
20.1
rRestated.
4A12
TheProducts
MOUTHWASHES
Table722:TraceableMediaExpendituresforMouthwashes,
2007to2012
Year
2007
2008
2009
2010
2011
2012
$ Million
Sales
735
779
761
759
782
799
TME
135
17
7
11
145
105
%TMEofsales
18.4
2.2
0.9
1.5
18.5
13.1
rRestated.
NAILPOLISHES
Table723:TraceableMediaExpendituresforNailPolishes,2007to
2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
305
307
341
406
564
662
TME
31
41
46
55
117
240
%TMEofsales
10.2
13.4
13.5
13.5
20.7
36.3
rRestated.
Table724:TraceableMediaExpendituresforPersonalCleansing
Products,2007to2012
Year
2007
2008
2009
2010
2011
2012
$ Million
Salesr
3,473
3,558
3,686
3,792
3,907
4,026
TME
240
314
297
378
281
154
%TMEofsales
6.9
8.8
8.1
10.0
7.2
3.8
rRestated.
713
714
TheProducts
SHAMPOOS
Table725:TraceableMediaExpendituresforShampoos,2007to
2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
2,311
2,307
2,276
2,361
2,501
2,620
TME
165
196
422
284
137
446
%TMEofsales
7.1
8.5
18.5
12.0
5.5
17.0
rRestated.
SHAVINGPRODUCTS
Table726:TraceableMediaExpendituresforShavingProducts,
2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Sales
345
336
341
348
362
373
TME
17
25
34
41
57
31
%TMEofsales
4.9
7.4
10.0
11.8
15.7
8.3
rRestated.
Table727:TraceableMediaExpendituresforSkinCareProductsfor
Men,2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
143
151
146
143
154
169
TME
11
17
69
25
5
16
%TMEofsales
7.7
11.3
47.3
17.5
3.2
9.5
rRestated.
4A14
TheProducts
SUNCAREPRODUCTS
Table728:TraceableMediaExpendituresforSunCareProducts,
2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Salesr
769
844
860
933
984
1,048
TME
82
78
73
61
77
80
%TMEofsales
10.7
9.2
8.5
6.5
7.8
7.6
rRestated.
TOOTHBRUSHES
Table729:TraceableMediaExpendituresforToothbrushes,2007to
2012
$ Milliona
Year
2007
2008
2009
2010
2011
2012
Sales
726
730
725
718
725
741
TME
69
115
49
49
51
42
%TMEofsales
9.5
15.9
6.8
6.8
7.0
5.7
aBatteryoperatedtoothbrushesareexaminedaspartofthisstudy
startingin2007.
rRestated.
TOOTHPASTES
Table730:TraceableMediaExpendituresforToothpastes,2007to2012
$ Million
Year
2007
2008
2009
2010
2011
2012
Sales
1,622
1,682
1,678
1,664
1,715
1,749
TME
287
291
139
324
362
338
%TMEofsales
17.7
17.3
8.3
19.5
21.1
19.3
rRestated.
715
716
TheProducts
Table731:TraceableMediaExpendituresforToothWhitening
Products,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
273
148
54.2
2008
281
112
39.9
2009
285
123
43.2
2010
287
70
24.3
2011
287
72
25.1
2012
271
79
29.2
OTHERCOSMETICSANDTOILETRIES
Othercosmeticsandtoiletriesincludemediaexpendituresforthoseproductsthatcannot
bedesignatedtoonespecificcategoryortothemultiproducthaircareanalysis.
TME for other cosmetics and toiletries total approximately $322million in 2012, up from
$293millionin2011.
4A16
MAJORCOMPANIES
INTRODUCTION
The following pages provide summaries of ad spending and sales data for the 29 major
companiesprofiledinthisreport.
ThesalescolumnreferstothecompaniescosmeticsandtoiletriessalesintheUnited
States.
ALTICOR
Table732:TraceableMediaExpendituresforAlticor,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
113
2008
120
2009
130
2010
145
0.7
2011
164
11
6.7
2012
176
12
6.8
aHistoricalTMEdatanotavailable.
bTMElessthanamillion.
AVON
Table733:TraceableMediaExpendituresforAvon,2007to2012
Year
$Million
Sales
TME
%TMEofsales
2007r
1,134
92
8.1
2008r
1,114
58
5.2
2009r
1,098
34
3.1
2010r
1,077
40
3.7
2011
1,014
15
1.5
2012
948
13
1.4
rRestated.
718
MajorCompanies
BEIERSDORF
Table734:TraceableMediaExpendituresforBeiersdorf,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
287
109
38.0
2008
297
107
36.0
2009
312
135
43.3
2010
322
61
18.9
2011
335
47
14.0
2012
344
26
7.6
CHANEL
Table735:TraceableMediaExpendituresForChanel,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
336
36
10.7
2008
312
35
11.2
2009
292
34
11.6
2010
346
62
17.9
2011
417
78
18.7
2012
461
87
18.6
CHURCH&DWIGHT
Table736:TraceableMediaExpendituresforChurch&Dwight,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007r
347
42
12.1
2008
361
57
15.8
2009r
366
50
13.7
2010r
339
54
15.9
2011r
321
69
21.5
2012
313
66
21.1
rRestated.
4A18
MajorCompanies
CLARINS
Table737:TraceableMediaExpendituresforClarins,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
153
10
6.5
2008
146
11
7.5
2009
136
3.7
2010
142
5.6
2011
160
23
14.4
2012
171
27
15.8
COLGATEPALMOLIVE
Table738TraceableMediaExpendituresforColgatePalmolive,2007to2012
$Million
Year
Salesr
TME
2007
1,382
89
6.4
2008
1,446
115
8.0
2009
1,448
49
3.4
2010
1,420
113
8.0
2011
1,431
87
6.1
1,493
110
7.4
2012
rRestated.
%TMEofsales
COMBE
Table739:TraceableMediaExpendituresforCombe,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
140
43
30.7
2008
146
67
45.9
2009
146
42
28.8
2010
143
41
28.7
2011
154
34
22.1
2012
157
39
24.8
719
720
MajorCompanies
COTY
Table740:TraceableMediaExpendituresforCoty,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Salesr
923
945
918
961
1,048
1,086
TME
224
168
97
326
245
283
%TMEofsales
24.3
17.8
10.6
33.9
23.4
26.1
rRestated.
ELIZABETHARDEN
Table741:TraceableMediaExpendituresforElizabethArden,2007to2012
$Million
Year
2007
2008r
2009r
2010r
2011r
2012r
Sales
279
298
316
286
313
290
TME
46
46
48
53
52
57
%TMEofsales
16.5
15.4
15.2
18.5
16.6
19.7
rRestated.
ENERGIZERHOLDINGS
Table742:TraceableMediaExpendituresforEnergizerHoldings,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Sales
314
324
324
354
379
396
TME
17
16
36
26
37
33
%TMEofsales
5.4
4.9
11.1
7.3
9.8
8.3
4A20
MajorCompanies
ESTELAUDER
Table743:TraceableMediaExpendituresforEsteLauder,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Salesr
2,526
2,450
2,332
2,399
2,569
2,722
%TMEofsales
6.5
4.6
5.1
7.8
10.6
14.2
TME
163
112
118
186
272
386
rRestated.
GLAXOSMITHKLINE
Table744:TraceableMediaExpendituresforGlaxoSmithKline,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Salesr
368
376
368
395
392
407
TME
108
107
144
158
150
130
%TMEofsales
29.3
28.5
39.1
40.0
38.3
31.9
rRestated.
GUTHYRENKER
Table745:TraceableMediaExpendituresforGuthyRenker,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Sales
388
422
453
493
616
737
TME
a
a
a
222
260
304
%TMEofsales
a
a
a
45.0
42.2
41.2
aGuthyRenkerwasprofiledforthefirsttimein2010,sohistoricalTMEprior
tothatyearisnotavailable.
721
722
MajorCompanies
HELENOFTROY
Table746:TraceableMediaExpendituresforHelenofTroy,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Salesr
208
200
175
168
160
147
TME
7
5
10
13
11
12
%TMEofsales
3.4
2.5
5.7
7.7
6.9
8.2
rRestated.
HENKEL
Table747:TraceableMediaExpendituresforHenkel,2007to2012
Year
2007
2008
2009
2010
2011
2012
$Million
Salesr
661
668
671
664
626
635
%TMEofsales
5.6
2.2
2.8
2.9
2.9
1.1
TME
37
15
19
19
18
7
rRestated.
JOHNSON&JOHNSON
Table748:TraceableMediaExpendituresforJohnson&Johnson,2007
to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Salesr
1,825
1,885
1,901
1,945
1,979
2,020
TME
576
376
396
415
486
440
%TMEofsales
31.6
19.9
20.8
21.3
24.6
21.8
rRestated.
4A22
MajorCompanies
KAO
Table749:TraceableMediaExpendituresforKao,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007r
466
143
30.7
2008
446
118
26.5
2009r
463
24
5.2
2010r
468
97
20.7
2011r
504
127
25.2
2012
525
131
25.0
rRestated.
LIMITEDBRANDS
Table750:TraceableMediaExpendituresforLimitedBrands,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
1,568
2008
1,512
0.1
2009
1,525
0.1
2010
1,602
2011
1,706
2012
1,785
aLessthan$500,000.
bLessthan0.1%.
rRestated.
723
724
MajorCompanies
LORAL
Table751:TraceableMediaExpendituresforLOral,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Salesr
3,961
3,924
3,897
4,056
4,304
4,551
TME
750
757
834
1,109
1,312
1,448
%TMEofsales
18.9
19.3
21.4
27.3
30.5
31.8
rRestated.
LVMH
Table752:TraceableMediaExpendituresforLVMH,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Sales
282
279
269
279
307
337
TME
37
33
37
39
55
90
%TMEofsales
13.1
11.8
13.8
14.0
17.9
26.7
MARYKAY
Table753:TraceableMediaExpendituresforMaryKay,2007to2012
$Million
Year
2007
2008
2009
2010
2011
2012
Sales
1,053
1,052
1,042
1,039
1,047
1,063
TME
8
3
7
5
14
18
%TMEofsales
0.8
0.3
0.7
0.5
1.3
1.7
NOTE:Salesincluderetailproductsonly;salesaidspurchasedby
consultantsforsellingeffortsarenotincluded.
4A24
MajorCompanies
MERCK
Table754:TraceableMediaExpendituresforMerck,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007r
189
22
11.6
2008r
196
23
11.7
2009
181
22
12.2
2010
185
17
9.2
2011
192
14
7.3
2012
209
18
8.6
rRestated.
PROCTER&GAMBLE
Table755:TraceableMediaExpendituresforProcter&Gamble,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
5,376
1,632
30.4
2008
5,538
1,561
28.2
2009
5,565
1,180
21.2
2010
5,757
1,300
22.6
2011
5,898
1,490
25.3
2012
5,824
1,217
20.9
rRestated.
725
726
MajorCompanies
REVLON
Table756:TraceableMediaExpendituresforRevlon,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
758
201
26.5
2008
759
162
21.3
2009
752
153
20.3
2010
768
166
21.6
2011
802
156
19.5
2012
814
161
19.8
rRestated.
SANOFI
Table757:TraceableMediaExpendituresforSanofi,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007r
158
2008r
179
47
26.3
2009r
176
35
19.9
2010
188
44
23.4
2011
194
69
35.6
2012
197
51
25.9
aSanofiisprofiledforthefirsttimein2008,sohistoricalTMEpriorto
thatyearisnotavailable.
rRestated.
4A26
MajorCompanies
SHISEIDO
Table758:TraceableMediaExpendituresforShiseido,2007to2012
$Million
Year
Sales
TME
%TMEofsales
2007
460
15
3.3
2008
477
10
2.1
2009
478
1.3
2010
494
1.6
2011
527
33
6.3
2012
542
52
9.6
THECLOROXCOMPANY
Table759:TraceableMediaExpendituresforTheCloroxCompany,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
85
2008
111
15
13.5
2009
125
19
15.2
2010
141
3.5
2011
158
3.8
2012
172
10
5.8
aTheCloroxCompanyisprofiledforthefirsttimein2008,sohistoricalTMEprior
tothatyearisnotavailable.
rRestated.
727
728
MajorCompanies
UNILEVER
Table760:TraceableMediaExpendituresforUnilever,2007to2012
$Million
Year
Salesr
TME
%TMEofsales
2007
3,022
462
15.3
2008
3,037
432
14.2
2009
3,109
464
14.9
2010
3,206
499
15.6
2011
3,406
458
13.4
2012
3,546
522
14.7
rRestated.
4A28

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Cosmetics&ToiletriesUSA

Each company subscribing to COSMETICS& TOILETRIES USA Continuing Service, including

2. Restrict circulation of this report to its own employees and those of

Accordingly, COSMETICS& TOILETRIES USA cannot be reproduced and must be restricted to

REPRODUCTIONORDISCLOSUREFORBIDDEN;SEE SPECIALNOTICE KLINE&COMPANY,INC.

As an international consulting firm, Kline also conducts proprietary projects on an individual

Advertising expenditures are based on Kline& Companys analysis of ad spending data

Each company subscribing to COSMETICS& TOILETRIES USA Continuing Service, including

2. Restrict circulation of this report to its own employees and those of

Accordingly, COSMETICS& TOILETRIES USA cannot be reproduced and must be restricted to

Improving economy supported by several innovative product launches, an increase in

Privatelabel products, a growing segment in the cosmetics and toiletries market is

Specialty stores register increasing sales of $4,228million in 2012, up 8.2% from

Innovations and technological advancements in terms of products, packaging, and

Each company subscribing to COSMETICS& TOILETRIES USA Continuing Service, including

2. Restrict circulation of this report to its own employees and those of

Accordingly, COSMETICS& TOILETRIES USA cannot be reproduced and must be restricted to

REPRODUCTIONORDISCLOSUREFORBIDDEN;SEESPECIALNOTICE KLINE&COMPANY, INC.

Rising consumer confidence, significant promotional activity, multibenefit products,

Total manufacturers sales of fragrances grow by 3.9% from $3,675million in 2011 to

In 2012, a number of marketers merge and acquire other brands or companies to

10% 15% 20% 25% 30% 35% 40% 45% 50%

$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to$125,000to$150,000to$200,000or Refuseto

$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to$125,000to$150,000to$200,000or Refuseto

$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to$125,000to$150,000to$200,000or Refuseto

$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to$125,000to$150,000to$200,000or Refuseto

$15,000to $35,000to $45,000to $55,000to $75,000to $100,000to$125,000to$150,000to$200,000or Refuseto

Specialty stores register increasing sales of $4,228million in 2012, up 8.2%, from

Sales through professional outlets decrease 9.3% to $1,331million in 2012 from

Although privatelabel product penetration in the cosmetics and toiletries industry is

Samplesarealsousedbybrandsas amediumtoattractconsumersto trytheirproducts,

The pessimistic scenario forecasts industry sales to reach $40,880million in 2017, up at a

Each company subscribing to COSMETICS& TOILETRIES USA Continuing Service, including

2. Restrict circulation of this report to its own employees and those of

Accordingly, COSMETICS& TOILETRIES USA cannot be reproduced and must be restricted to

REPRODUCTION ORDISCLOSUREFORBIDDEN;SEESPECIALNOTICE KLINE&COMPANY,INC.

Category performance. Reports the categorys sales performance at the manufacturer,

Total manufacturers sales of fragrances grow by 3.9% from $3,675million in 2011 to

Category growth continues to be driven by firmlyentrenched brands, such as LOrals

A movement to ban the wearing of fragrances in the workplace is gaining awareness in

Giftwithpurchase (GWP) and purchasewithpurchase (PWP) offers are the domain of

The categorys growth continues to be driven by classics, such as Chanels Coco

VS Fantasies (Limited Brands), formerly Victorias Secrets Garden, is the secondlargest

Sales are projected to increase at a CAGR of 3.5% to $3,231million by 2017 from

Conditioners, with sales at $1,653million in 2012, is the thirdlargest category in the

In 2012, manufacturers sales of conditioners grow 4.8% to reach $1,653million, up from

Product customization continues to be an important product trend among hair care

Sales of the privatelabel conditioners decline by 4.7% from $43million in 2011 to

In 2012, traceable media expenditures (TME) specifically for conditioners total

Products targeted at men are expected to increase, resulting in an increase in the

Marketers are expected to incorporate more natural ingredients in their products, as

Pricebased promotions and discount coupons continue to be an important means of

Pricebased promotions and media advertisements are also an important means of

Manufacturers sales of the category are forecast to grow at a CAGR of 0.7% to

Gels experience a modest growth of 0.3% to reach $385million in 2012, up from

Manufacturers will continue to introduce hair styling products with multibenefits to

Manufacturers sales in the category grow 4.8% from $2,501million in 2011 to

Marketers continue to incorporate natural ingredients in their hair care products as

In 2012, TME for shampoos total $446.3million, up significantly by 27.0% from

Thirdleading marketer LOrals media spending on promoting its shampoo brands is

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Procter&Gamble continues to be the thirdlargest makeup marketer in 2012 with its

Retailsalesoftheeyemakeupcategoryareestimatedat$4,122millionin 2012, up3.4%

Direct marketerscontinue to rely on sales consultants to promote their products,but are