Cosmetics industry stocks and shares up 32 percent

By Chris BARKER

- Last updated on GMT

Cosmetics industry stocks and shares up 32 percent

Related tags: Male cosmetics market, Cosmetics

An investment publication has reported that the stock price of companies in its Cosmetics and Personal Care Industry Group portfolio grew by 32 percent in 2013.

Investors.com, the online branch of Investors Business Daily (IBD), states that the rise was one of the 30 best gains of all the industry groups tracked by the publication.

The publicaiton also noted that the global companies in the groups’ share prices grew more quickly than those in the industry in general, where global sales were increasing at about 5 percent annually. 

Emerging markets were given the credit for much of the growth, with Proctor & Gamble, for example, reporting developing market sales growth of 14 percent per year.

Issues such as slow US growth and the crisis in Europe have meant a more sedate increase in size for Western markets.

On the other hand, Euromonitor still predicts an annual growth rate of 3-4 percent in the US beauty and cosmetics industry, with the total value of the industry reaching $81.7 bn by 2017.

Older customers

IBD noted that consumer trends such as an ageing US population would lead to opportunities for product developers.

By 2030, nearly one in five Americans is predicted to be 65 or over.

Rob Robinson, a cosmetics developer, was quoted as saying: "Fifty is the new 40. People are trying to look good at any age. Beauty products are the quick and easy answer to looking and feeling younger short of undergoing surgery."

Cosmeceuticals

“Cosmeceuticals,” including anti-ageing treatments and sun cream foundations, were the fastest-growing section of the industry and are likely to grow by 8 percent annually between 2012 and 2016, according to a report by Farmington, Conn.-based Global Information.

Johnson & Johnson, Bayer, L’Oreal, Procter & Gamble, Avon and Shiseido were identified as major players in the cosmeceuticals market.

Mixed-race women

Investment  also highlighted the growing role of mixed-race customers in the cosmetics market. 

Mixed-race children are the fastest-growing youth group in the country, and the number of Americans who consider themselves to be from two or more racial backgrounds has increased by 32 percent from 2000 to 2010, for a total of 2.4 percent of the population.

US cosmetics companies are increasingly marketing at multiracial consumers, with Lizzie Johnson, store manager for Houppette cosmetics and accessories in Greenville claiming: “Shade ranges have come a long way.”

Male groomers

The male cosmetics market was reported to be underdeveloped, with Karen Grant, VP of beauty and global industry analyst for consumer research organization NPD group stated that it holds: “Great potential.”​    

The publication also pointed out some investment risks for cosmetics in the US, include a high failure rate for new product launches, stagnant real incomes and an appreciating dollar.  

Related topics: Business & Financial

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