Beauty Industry (Study Guide)

Beauty Industry Key Concepts ● History and development of the beauty industry ● Categories and the major market segments in beauty ● Federal laws and environmental issues affecting products ● Advertising and promotion of beauty products ● Trends in the beauty industry History and Development of the Beauty Industry ● For centuries, the pursuit of beauty was the prerogative of the rich. Special beauty aids concocted in temples, monasteries and kitchens were available only to the privileged few. ● Only in the past 75 years has the pursuit of beauty found its way to modern laboratories and brought with it an ability to manufacture and distribute cosmetics on a widespread basis for ordinary people. ● Max Factor, the Hollywood makeup artist is credited with popularizing the t erms lipstick, makeup & eyeshadow in the 1920’s. ● The 1970’s saw the emergence of products made from natural ingredients as aloe vera, musk and henna. By the 1980’s the trend for natural cosmetics turned into a a full blown consumer preoccupation with health and self image. The public was seeking products that maintained and protected their skin rather than merely enhancing them cosmetically. Skin care products became the fasted growing segment of the cosmetics industry. Dreams vs. Science ● For decades the word “moisture” alone was enough to sell a skin cream. Today, creams are promoted with their ability to “nourish” or “renew”. We use a daily dose of skincare products which are likely to be “PH-balanced” and promise a laundry list of benefits from age-defying, wrinkle reducing to anti-blemish formulas. Legends vs. the New Entrepreneurs ● The beauty market has become increasingly segmented as different kinds of cosmetics and scents are made available to customers based on their age, gender, ethnic group, lifestyle, and ability to pay. ● The beauty industry has always been dominated by personalities. Something that still holds true today. The first worldwide celebrity associated fragrance was Coco Chanel. In 1921, she introduced a perfume that despite its unpretentious name, became associated with designer fashion: Chanel No. 5 The name is said to have come from her superstitious beliefs in the virtues of the #5. Apparently she picked the 5th perfume sample she tried and the name stuck. It was the first perfume to be created by a fashion house. It’s still one of the top selling women’s perfumes to this day. Organization and Operation of the Industry A Global Business ● All large, nationally advertised cosmetics firms produce hundreds of items. For sales and inventory purposes, products must be divided into broad categories. The Main Categories ● Fragrances ● Color Cosmetics (facial makeup including lip, cheek, eye and foundation) ● Skin Care ● Sun Care ● Nail Care ● Hair Care Private-Label Manufacturers ● Although dominated by giant producers of nationally advertised brands, many private label manufacturers produce merchandise to the specification under the brand names of chain stores, department stores, hair salons and small independent stores. Copycat Scents ● In the 1980’s we saw the birth of copycat fragrances. These products are unabashed imitations of the packaging as well as the aroma of popular designer fragrances at a fraction of the cost. Comparison advertising highlights the price difference to assure customers who cannot afford the prestigious brands that they’re getting value for their dollar. Federal Laws ● Chemicals are the basis for most cosmetic products, the Food and Drug Administration (FDA) is the federal agency that policies and regulates the cosmetic industry. Manufacturers are prevented by FDA regulations from using potentially harmful ingredients and from making exaggerated claims regarding the effects of their products. Environmental Concerns ● Environmentalism, as a major issue of political and social concern, has had a strong effect on consumer buying habits. Attention to health and fitness influence what people are willing to put on their skin and hair, so demand for natural products and ingredients has arisen in the cosmetics and fragrance industry. Even Sephora carries a whole section devoted to “Natural Beauty” products. Market Segments The Male Market ● Changing male images are opening up new and larger markets in hair care, face and body care, and fragrances. Men are buying more diversified products such as moisturizers, cleaners and skin toners. In 2012, sales of men’s toiletries and cosmetics in the United Sates hit $2.6 billion. Today that number is close to $50 billion worldwide. ● In August 2018, Chanel debuted their first Men’s makeup line called Boy de Chanel. The collection includes foundation, moisturizing lip balm and eyebrow pencil. ● In October 2016, Covergirl Cosmetics introduced James Charles as their first male ambassador ● “Made-up men reflect changing $50bn male grooming industry” The Teen Market ● Buying a first lipstick has been a right of passage for teenage girls for generations, but the typical teenage girl of today has gone far beyond this initial plunge into the beauty industry. The US youth collectively spend billions of dollars a year on cosmetics and toiletries. From their first tube of Bonnie Bell lip gloss to purchasing acne treatments and concealers.