It would seem, judging by the strength of the health and beauty market in the UK, that beauty products are as essential a purchase as groceries. Although other products classed as non food items are seen an extravagant and unnecessary purchases by consumers who are becoming increasingly thrifty, they are still embracing health and beauty products at an astounding level.
Research firm The NPD Group have released data which indicates that sales of make up, skincare products and fragrances have risen by 8%, 9% and 13% respectively in the first half of this year, compared to the same first half of 2010, which is astonishing seeing as high street trading on the whole has tumbled.
Boots are the largest retailer in the health and beauty sector, and they reported recently an LFL, like for like, growth in retail revenue in the UK for the year that ended March 2011. Debenhams, the high street chain of department store has named health and beauty as one of its strongest areas for sales in the latest set of results.
The resilience of sales of beauty products while all others take a downturn is legendary and is nothing new, but the strength of the market at this time has surprised everyone as the fact that they now seem to be perceived as essential items has given the UK market a huge boost.
Aaron Chatterley is the CEO of the online retailer Feelunique.com, and he agrees with the data that shows how people are still prioritising these goods, despite the economic climate. He also points out that on their site the sales of hair products has doubled in the past year, and he believes they are still doing so well as people see these no longer as luxury items and more as essentials.
It is also ironic that another sector that is performing well as far as sales go are luxury goods, and the success that premium brands of cosmetics are enjoying reinforces the fact that despite it being a tough time financially for many consumers are still prepared to pay extra for quality.
NPD Beauty UK’s Gareth Shaw told the Retail Gazette that the trust consumers have in certain brands is a major factor in their purchasing decisions and this gives the high end brands an advantage over the cheaper labels. An example of this is that such luxury brands of fragrances like Chanel and Dior have seen sales growth, yet those endorsed by celebrities could suffer as they are perceived as being of a lower quality.
At one time, a shopper may have tried several perfumes, they are now more than likely to stick with one that they are confident with and feel is worth the price tag. Quality taking precedence over price is more much more prevalent in Britain than the rest of Europe, as premium cosmetics sales have grown by 10% in the first 6 months of 2011, compared to France’s 1.12%, Italy’s 1.8% and Spain’s lowly 0.3%.
Chatterly believes that these preferences for quality goes right across the health and beauty sector, and is allowing retailers to focus their offers on the evolving priorities of the consumer. He said that he thinks the sensitivity over price has become much less important over recent years and that people see luxury goods with perks such as free delivery and ‘free gift with purchase’ better value than the cheaper alternatives.