Consumer spend on ethnic-specific products amounts to US$1.5 billion

- Last updated on GMT

Related tags: Marketing, Marketing research, Market research, Beauty products

Only a fifth of health and beauty products purchased by ethnic
consumers in the US are specifically formulated for that market,
according to a report published by market research company Packaged
Facts.

The spending power of Asian-, Black- and Hispanic-Americans amounts to nearly US$2 trillion (€1.5 tn), a potential market that manufacturers have been trying to tap into with marketing techniques such as celebrity endorsements.

Last year, sales to ethnic consumers amounted to US$7.5 billion (€6.1 bn), of which a fifth, or US$1.5 billion (€1.2 bn), represented ethnic-specific health and beauty products, according to a report entitled 'US Market for Ethnic Cosmetics, Hair Care, and Beauty Products', published by market researchers Packaged Facts​.

Sales of ethnic-specific products remained stagnant in 2003, in fact falling by one per cent from the previous year. Purchases by ethnic consumers of general-use health and beauty products rose by a similar amount and were valued at US$6 billion (€4.8 bn).

Their research indicates that general-use products, like Unilever's Suave shampoo, are top choices among ethnic consumers, rather than ethnic-specific brands.

"Growth in the ethnic HBC market will have to come through nontraditional ways,"​ said acquisitions editor for Packaged Facts Don Montuori.

"Companies will need to extend mainstream product lines to attract ethnic consumers,"​ Montuori added, "but they shouldn't abandon niche positioning, such as launching products for Hispanic-Americans or developing more natural product lines for African- Americans that are not reliant on harsh chemicals."

Companies with operations in the US have already noted demographic statistics that show Asian-, Black- and Hispanic-Americans already account for a quarter of the population and by the end of the century this will rise to a third. The populations of states such as California and Texas are expected to have a non-white majority by the year 2010.

Related topics: Market Trends

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