US hair care market remains sluggish
€7.6 billion in 2004, a trend that is prompting companies to
explore new niche growth markets.
The decline of the market reflects its saturated and highly competitive state. However, according to market reports publisher Packaged Facts, a rash of innovation is helping to jump start the industry as it begins to focus on specific groups.
Looking at the general state of the hair care category, the report says that demographic shifts are partially to blame for the decline. In 2003, there was a 1.02 per cent drop in the core hair care group (women aged 35-45 years), which even affected high-penetration shampoo sales.
In response to the general decline of the category, manufacturers are increasingly targeting ethnic minorities as well as the growing market for men's cosmetics products.
Companies are launching more and more products aimed specifically at individual ethnic hair requirements, such as anti-frizz products are helping to contribute to a US market for ethnic and personal haircare products that is now valued at $1.5 billion.
Likewise the evolution of the so-called 'metrosexual' has led to a significant increase in spending on men's cosmetic and toiletry products. Male-dedicated shampoos and other hair care products are becoming increasingly popular, with hair-loss treatments, styling products and hair coloring all proving to be major growth areas.
Hair care formulations are also reflecting the growing trend towards more natural products, with herb, fruit and essential oils, as well as biotanical ingredients all becoming significantly more popular.
The report, entitled The U.S. Hair Care Market stresses the importance of continued product development specifically in the ethnic market.
Filling the void in this under-served area successfully creates a double win for marketers who can make the most of increasing population rates - particularly in the Hispanic group - and buying power of ethnic communities.
"An underlying factor driving several trends across the category is long-term hair health," said Don Montuori, acquisitions editor for Packaged Facts. "Consumers have much higher expectations and will not sacrifice the innate strength and healthfulness of their hair for fashion or fads. We see this in both the steep sales decline of heavy chemical processes like perms and in the upswing in natural, organic and spa products."
