The global economic downturn appears to have hit the men’s grooming segment hard, as some of the biggest players witness lower sales in the category.
The world’s largest player in the men’s grooming sector, Procter & Gamble, recently announced a 17 percent drop in its sales for this category during the quarter ending in June.
The company said that the fall in its men’s grooming sales was a major factor contributing to worldwide sales for the group during this period shrinking by 11 percent to reach $18.66 bn.
In fact P&G has not been the only company to suffer during this period. Recent market research by Bernstein suggest that overall sales of men’s grooming products in the US fell by 20 percent in the four weeks up to mid-June.
Why are men's grooming sales falling?
The fact that P&G has recorded this kind of performance is significant, solely because of the fact that there is a virtually unanimous belief amongst market experts that the category should remain buoyant, despite the prevailing economic conditions.
Typifying this was a recent study by financial analysts Fitch, which stated the belief that the men’s grooming sector would be one of the main categories for personal care providers to turn towards to help battle their way through the recession.
P&G has expanded its present in the men’s grooming segment immensely in recent years, namely with the purchase of Gillette back in 2005 and more recently the upscale brands Zihr and Art of Shaving, which were bought in June of this year.
P&G positions itself at the top end
The direction P&G has taken has positioned it at the top end of the men’s grooming category, with the Gillette brand being placed in the ‘masstige’ segment, consequently giving products a premium price tag.
In the face of this, one of the defining characteristics during the downturn has been the fact that personal care consumers are increasingly shunning more expensive products for cheaper brands and lower-priced private labels.
This factor also goes a long way to explaining why P&G’s men’s grooming sales have been so hard hit, given their up-market positioning.