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Kline Projects Moderate Growth Over the Next Five Years in the Cosmetics & Toiletries Market

-- Market Should Witness Two More Years of Sluggish Growth - as Consumers Continue to Spend Less - Followed by Three Stronger Years --

LITTLE FALLS, NJ, May 27, 2009 –

U.S. sales in the cosmetics and toiletries market grew only by 0.3% in 2008, the lowest since 1991, according to the latest study completed by worldwide research and consulting firm Kline & Company. The new data available in Cosmetics & Toiletries USA 2008 indicates that sales have reached a total of $35.6 billion at the manufacturers’ level, but consumer concerns about the recession may ensure that these levels do not rise higher during 2009–10.

Consumers are showing a preference for competitively-priced products from the mass and direct trade classes. Therefore, premium products sales are being affected heavily by these negative market conditions. In fact, salon, specialty, and luxury trade classes all demonstrated negative growth, whereas mass and direct trade classes turned out to be the fastest growing segments.

“The new frugal mindset imposed by the recession has altered spending and product consumption habits, some of which will probably continue into the foreseeable future,” notes Nancy Mills, Industry Manager, Consumer Products practice, at Kline. “Many people have traded down on certain products, and as they get accustomed to buying some lower-priced or private-label products, and shop more in the lower-priced channels, they might well continue with those habits after the tough times have subsided. To be successful, companies will likely continue to infuse the mass segment with more sophisticated products to compete with luxury products.”

Skin care, the largest product class, was also the second-fastest growing category during 2008, spurred by the sun care category. Although consumers have curtailed spending, they are not ignoring innovative and sophisticated new products. Marketers propel growth with product development, albeit the rate of new launches slows down in 2008. Some brands that did very well in the previous years such as Bare Escentuals, had slower growth in 2008, whereas, some mass brands like Garnier skin care and Neutrogena sun care showed very strong growth. Some luxury brands did buck the trend with great results—such as La Prairie.

Oral care is the fastest growing product class, in part, due to new product activity led by the very successful launch of Colgate Total Advanced Whitening toothpaste. Other products such as ACT mouthwashes had outstanding growth due to repositioning efforts by new owner Chattem. Also, Burt’s Bees, along with mass brands in other categories including Rimmel and TREsemmé, performed well above the average.

Kline projects a moderate growth over the next five years. Years 2009–10 will be sluggish, but the following three years are expected to witness growth. This growth will be affected negatively by stricter legislation on claims and ingredients and the new consumer mindset of cautiousness on spending. However, it will be impacted positively by product innovations and new alliances and mergers between companies.

Cosmetics & Toiletries USA 2008 is the authoritative source of information on the cosmetics and toiletries industry. It contains information on market size, retail sales, channel breakdowns, trends, as well as forecasts for 29 product categories, and detailed profiles of 26 leading marketers.

About Kline
Kline is a worldwide consulting and research firm dedicated to providing the kind of insight and knowledge that helps companies find a clear path to success. The firm has served the management consulting and market research needs of organizations in the chemicals, materials, energy, life sciences, and consumer products industries for 50 years. For more information, visit

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