The report from NPD Group, a global information company, says that sales of prestige beauty products grew twice as fast - at 6% - in the three months following the UK referendum to leave the EU (July to September) compared to the 3% growth seen from January to June 2016.
The greatest growth post-Brexit has been in the sale of niche fragrances (£125+) and super premium skincare (£200+), according to NPD, both of which reported double digit growth. The firm cautions, however, that the rapid growth is unlikely to be sustained.
Reporting double digit growth, super premium skincare sales rose 32% compared to the same period in 2015, and in comparison to pre-Brexit where the sector only grew by 4%, according to NPD.
Niche fragrances reported an increase of 59.5% in sales compared to the same period in 2015, growing twice as fast as vs pre-Brexit (at 28% growth in January to June 2016 compared to 2015).
“Prestige beauty plays a vital role in the cosmetic market in the UK, and sales of prestige beauty products in the UK was valued at £2,446 million in 2015,” the firm states.
London and online: leading the charge
NPD explains that its online sales and those within the capital driving the rise in premium growth, suggesting overseas spenders are boosting the segment, in line with predictions.
For the three-month period July to September 2016, online sales (although it only represents 9.2% of total prestige beauty market) increased by 34.3% compared to the period July to September 2015 and contributes most (43.7%) to total prestige beauty growth in this period, the firm says.
The second biggest contributor in the three-month period post Brexit was London, with 37.9% of total growth, increasing sales at by 7.3%. London represents 30.1% in value of the total prestige beauty market in the UK.
“The growth in prestige beauty sales is impressive,” says Teresa Fisher, Senior Account Manager, NPD UK Beauty, though she cautions it is unlikely to carry on at these rates.
“The sale of prestige beauty products has seen unprecedented growth in the three-month period following Brexit. This is great news for retailers and manufacturers both in store and online and represents a huge opportunity for prestige beauty in the upcoming Christmas festive season, however, based on trended insight we do not believe this can be sustained.”