Beauty brands have big plans for 2019

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Beauty brands have big plans for 2019

By Seth Mendelson - 02/28/2019
With all the good news being bandied around, it seems that the mass-market cosmetics and personal care businesses are struggling a bit, and it may get worse before it gets better.

A heady combination of increased challenges from independent brands and a shopper drain away from mass to such specialty doors as Sephora and Ulta Beauty caused some angst for retailers looking to cash in on this key segment.

That said, mass-brand manufacturers and retailers remain optimistic, convinced that this year will show a turnaround in volume and consumer expectations.

An opportunity to fortify the self-care movement as a way to shore up beauty sales also exists. For example, Maly Bernstein, vice president of personal care at CVS Pharmacy, said that during the holiday season, the chain saw more customers “hitting our beauty aisles for some ‘me time.’” Optimism also is rife as mass brands introduce more vegan, CBD-based and edgy innovation into the market.

Another pot of gold for mass is skin care. Facial cleanser category sales were up 11% and moisturizer sales were up 16%, compared with the previous year, according to Nielsen data through Dec. 1.
The good news in skin care was met with some sobering data from Nielsen. Mass-market makeup and nail sales were flat on a 52-week basis. Brands that once blazed the path struggled, including e.l.f., whose sales were off 14%; Coty, which was tracked down 13%; and Revlon, whose dollar volume declined 11%. Fragrance fared even worse, off 7% during the period.

Compounding the challenges, TABS Analytics 5th Annual Color Cosmetics Study suggested the beauty industry, in general, is about to hit a wall. The research survey of 1,000 consumers showed that the heaviest beauty enthusiasts are buying less. “This sector is clearly in decline and will soon be in recession — a state that retailers and product manufacturers can expect to last for several years,” said Kurt Jetta, president and founder of TABS Analytics.

Jetta suggested that this trend would put the brakes on the rampant mergers and acquisitions that punctuated the industry, and even make launching shade and line extensions challenging.

Undeterred, some officials at the nation’s biggest legacy brands said they are readying for battle to change the course. Many new faces are in executive suites and a playbook consisting of more influencers’ programs, edgy innovation and an escalation of pricing. That last move could pay off, suggested Jefferies’ analyst Stephanie Wissink, who said trading up to “masstige” is showing signs of life in the mass landscape.

Here is a sampling of what the major beauty brands are unfurling for 2019.

L’Oréal/Maybelline/Garnier/NYX
Somehow, amidst the backdrop of dwindling sales from competitive brands, L’Oréal’s portfolio tracks above industry growth, Wissink said. “NYX continues to lead L’Oréal’s portfolio, up 3% for the 52 weeks. Maybelline accelerated 5% on a four-week basis.”

What’s L’Oréal’s secret sauce? Retail and financial experts pointed right to the top management, starting with Jean-Paul Agon, the company’s chairman and chief executive. “I believe more in competition and exemplarity. The best way to move the industry is to move forward and others will follow, will compete, and that’s what’s happening,” Agon said.

L’Oréal is well prepared for the struggle, especially with NYX Professional Makeup, one of the hottest nameplates under its banner. NYX is putting a sparkle into sales this year, literally, with a new Glitter Goals Pro Palette and Liquid Eyeliner. Glitter is poised to have a big year, experts said.

L’Oréal always has found ways to make its brands — including Maybelline and Garnier — click with new consumer demands. On the product front, Maybelline, in particular, has attracted younger users. Its sales were up 4% in the past 12-week period ended Nov. 16, as tracked by Nielsen.

Fit Me was a big hit, and new items in the pipeline are expecting to resonate with millennials, buyers said, such as Snapscara mascara — featuring a campaign starring Gigi Hadid and Adriana Lima, along with other models. Garnier has ramped up its efforts in the fast-growing mask business under its Skinactive logo.

Retailers are set for such rapid-fire launches from the company as Unlimited Mascara, featuring a two-position bendable brush; Infallible Full Wear Concealer; the Rouge Signature Matte Colored Ink; and Infallible 24HR Fresh Wear Foundation. In skin, L’Oréal will put even more muscle behind its Age Perfect franchise. The new Hydra-Nutrition Range, retailing from $19.99 to $24.99, includes manuka-honey-
infused skin balm, day cream, night balm and eye gel developed for aging-related dryness. Also rolling out to broader mass retail distribution is the L’Oréal Paris Revitalift Derm Intensives line, which launched online in November. Garnier has launched a new franchise called Glow Boost, with an emphasis on natural and clean ingredients.

Product innovation is on the front burner at Maybelline, said Amy Whang, senior vice president of marketing at the New York City-based company. “Maybelline prides itself on creating cutting-edge formulas that deliver incredible results,” she said. “We offer tones and textures for every woman and focus on products that perform, work hard for her lifestyle, and are easy to use.” An example rolling out is Made for All, a range of 12 lipsticks priced at $7.49 that was road tested on 50 skin tones.

The company has not been timid about expanding its digital footprint. “The digital revolution is a real revolution because it made everything different,” Agon said. “The digital revolution may be responsible for the birth of many e-commerce based indie brands, but it’s also behind the growth of existing large brands,” he said. He also said the need to keep up in regard to technology was why L’Oréal acquired ModiFace, which just debuted a virtual salon nail app — one beauty segment that had been hard to capture in augmented reality.

Procter & Gamble
Although P&G sold off most of its beauty franchise to Coty, the surviving name-plates are having a healthy renaissance, especially Olay.

“There isn’t a piece of our beauty business that isn’t growing right now,” said P&G CEO David Taylor. P&G borrowed a page from its bustling premium SK-II brands to rejuvenate Olay. Olay, in fact, could serve as a textbook case for how to revamp a mature line. Alexandra Keith, president of global hair care and beauty sector at P&G, took a hard look at the SKUs in the sagging line and cut 20% of them, while also upgrading the packaging to make it more relevant to contemporary shoppers. Social media got more plugged in and more influencers were put to work. The strategy worked, and Olay posted
double-digit growth in its last quarter.

There’s more in store for 2019 with such launches as Olay Masks and Olay Mists. Olay Masks is a range of three clay-based stick masks — Glow Boost with white charcoal, Pore Detox with black charcoal and Fresh Reset with pink mineral complex — targeted at different skin issues. Olay Mists, designed to instantly hydrate, are available in two varieties — vitamin C and bergamot extract, and aloe leaf and chamomile.

Under its Simple brand, P&G will offer three of its best-selling skin-care formulas in a new pouch format designed for the on-the-go consumer.

P&G’s hair care business also is adding more bounce — sales were up in low single digits. Natural is a segment P&G admitted it has to play catch up in and, earlier this year, the company kicked off a partnership with Kew Garden to help identify active botanic