It’s no secret that consumers are making fewer shopping trips and are generally filling their baskets less during those trips. Often considered a discretionary expenditure, beauty aisle products have also been negatively impacted by this post-recessionary “new normal.” Although 94 percent of all U.S. households purchase beauty products, and sales across the industry totaled $33.5 billion last year, beauty sales are relatively flat in many types of stores. However, Hispanic consumers represent a big growth opportunity that beauty brands are not adequately courting.
The Hispanic market posted more growth across all beauty segments than did the general population. While sales coming from non-Hispanics are declining in several categories (cosmetics, hair care, personal care appliances and shaving needs), all of those categories are actually growing among Hispanics. Cosmetics, for example, were down 1.2 percent in 2014 from 2013 among non-Hispanics, but were actually up 7.4 percent among Hispanics in that same time frame. In fact, half of the top 20 categories where Hispanics over-index are in the health and beauty segment.
"Beauty Care sales trends demonstrate powerful evidence of how Hispanic consumers act as the accelerators in growing categories while also serve as the brakes for declining ones," Monica Gil, general manager and SVP, multicultural growth and strategy, Nielsen, told Progressive Grocer. "Marketers and retailers benefit from understanding the differences in Hispanic category consumption because it will help them identify where they spend substantially more than the rest of the population.”
What should beauty brands know about Hispanic consumers to increase their sales?
- Hispanics are not a homogenous consumer group. U.S.-born Hispanics and foreign-born Hispanics shop the beauty aisles differently from one another. U.S.-born Hispanics generally spend more on beauty than foreign-born or non-Hispanics -- $275 per year per household vs. $267 and $213, respectively. Spanish-speaking preferred and English-speaking preferred Hispanic households also shop differently than one another. Spanish-speaking-preferred Hispanics spend more on hair coloring, hair growth, personal care and disposable diapers than do their English-speaking-preferred counterparts. Conversely, English-speaking-preferred Hispanics tend to spend more on hair spray and powders for women than do their Spanish-speaking counterparts.
- Latino men do not differ much from Latina women in terms of using grooming products. Hispanic men also over-index in several beauty categories. Additionally, their interest in such products is increasing. For example, Hispanic men experienced a 15.5 percent increase in fragrance purchases in 2014 from 2013, whereas non-Hispanic men experienced a more modest 5 percent increase.
- The baby beauty category is also growing among the U.S. Hispanic community. Baby beauty products include items such as powders, lotions and a popular product among Hispanic consumers that is nearly unheard of among non-Hispanic American consumers -- baby cologne. Hispanics account for 17 percent of the total U.S. population according to the U.S. census, but they contributed 16.2 percent to baby beauty category sales in 2014.
“Several companies have shifted how they approach the Latino market," Gil added, "no longer relegating them to second tier consideration, but making Latinos a focal driver of business growth.”