The Cosmetics Industry Today

Please note: Documents cited on this Web site may be offered in several formats. To view PDF documents, a free viewer is available for download from Adobe Acrobat.

"In the overall health and beauty care market, makeup margins tend to be the highest (as much as 38%), followed by skin care (as much as 35%). Hair care--satisfying the most basic beauty needs--lags at up to 33%." The markup margin for face makeup (foundation, blush, etc.) is 31%-36%, Lipstick/lip gloss is 29%-34%, and Eye makeup (liner, shadow, etc.) is 28%-33%.¹

In recent years, consumers have been spending higher levels of disposable income on cosmetics than they had in the past. Unfortunately, the global financial crisis has put a damper on the market and during those years, more affordably priced merchandise and do it yourself at home products were key in the beauty market. Although there are some exceptions, generally speaking, for all products the higher the household income, the higher the spending percentages. However, in recent years as Generation Y has really entered the job market, they have become a big driver of the cosmetics market in the United States.² There also seems to be an increased interest in natural and organic beauty products particularly in the United States and Europe and worldwide sales were $9 billion and projected to bet $14 billion by 2015 according to Organic Monitor.³

Issue 17/18: Summer/Fall 2010

Guide to the Business of Beauty: Selected Information Resources

Table of Contents

Overview
History
Present-Day
Companies
Cosmeceuticals

Geographically there are three countries to mention as being top consuming countries - the United States, Japan, and Brazil - though countries like China, India, Mexico and Russia are emerging as big cosmetics markets. Of the emerging economies it is Brazil, with its growing middle class and intense beauty culture, that is one of the countries that accounts for a large share of the cosmetics market outside of the United States and Asia. Cosmetics sales have been down in recent years due to the global economic crisis, but the industry is improving. Sales of nail polishes have seen a worldwide growth of 11% in 2011 and has supplanted lipstick as a barometer of the beauty industry. Prior to the global economic crisis, spending on premium brands (those sold at a significantly higher price point) were high. The numbers went down between 2007 and 2011, but in 2011 there was 5% growth in premium brands, the best since 2007. It also seems that China is making its mark in this area and sales of premium brands there has increased.⁴

Some manufacturers like Aveda, The Body Shop, and M A C have their own stores but most products are sold in drug stores or department stores. Drug stores sell typical consumer brands like Boots, Botanics, L'Oreal, MAX Factor, Cover Girl, Maybelline, etc. Sometimes stores sell their own or an exclusive brand, such as Sonia Kashuk, sold by Target. For more "upscale" products, department stores sell from manufacturers like Clinique, Prescriptives, Lancôme, etc.

Industry Codes

There are various systems used for industry research to classify business entities. Knowing these schemes can make some areas of research easier because some databases, many of the print sources, and the U.S. government (most notably the Census) use them in their indexing, charts, graphs, lists, and indexes. For the cosmetics industry, the most important of these in the United States are the North American Industrial Classification System (NAICS) and the Harmonized System (HS). Internationally, the Standard International Trade Classification (SITC) is widely used. Relevant codes from these systems are included in the section below, along with links to government data about the cosmetics industry available using these codes.

Retail / Wholesale

North American Industrial Classification System (NAICS)
http://www.census.gov/eos/www/naics/

May appear in conjunction with Products & Services Codes

  U.S. Census Bureau Industry Reports

Industry Sampler (2007 Economic Census): NAICS 446120
Cosmetics, beauty supplies, and perfume stores
http://www.census.gov/econ/industry/current/c446120.htm

Statistics of U.S. Businesses: NAICS 44612
Cosmetics, beauty supplies, & perfume stores. 2006.
http://www.census.gov/epcd/susb/2006/us/US44612.HTM

Economic Census Industry Series Reports: Retail. 2002.
http://www.census.gov/econ/census02/guide/INDRPT44.HTM
(Scroll to NAICS codes 446 and 448 to link to reports and data about the retail cosmetics trade in the United States.)

Standard International Trade Classification (SITC)
Group: 553 - Perfumery, cosmetic or toilet preparations (excluding soaps)
http://unstats.un.org/unsd/cr/registry/regcs.asp?Cl=14&Lg=1&Co=553

553 Perfumery, cosmetic or toilet preparations (excluding soaps) [PDF: 400 KB/ 1 p.]
From the 2009 International Trade Statistics Yearbook (Select 553)
http://comtrade.un.org/pb/CommodityPagesNew.aspx?y=2008

Harmonized Code
http://www.foreign-trade.com/reference/hscode.cfm?code=33

- - International Trade Data by HS Code

Imports/Exports 2001-2009 International Trade in Goods Statistics by Product Group
See Trade by Commodity Statistics 2001-2011 and chose imports or exports link by product group and country or by country and product group. Select links under Group 33.

Manufacturing

North American Industrial Classification System (NAICS)
http://www.census.gov/eos/www/naics/

Industry Sampler (2007 Economic Census): NAICS 325620
Toilet preparation manufacturing

Print Resources

"Anti-aging Products and Services," in Encyclopedia of Emerging Industries. Detroit: Gale, 1998 - present.
LC Call Number: HD2324 .E528 2011
LC Catalog Record: 98660099

A six page overview covering SIC's 2844, 2833, and 2834. Includes organization/structure, background and development, research and technology, current conditions and a short bibliography of "further readings". The latest edition available is from 2011.

WWDBeautyBiz. New York : Fairchild Publications Inc., 2001-present
LC Call Number: HD9970.5.T65 B43
LC Catalog Record: 2003206472
Online: http://www.wwd.com/beauty-industry-news/

In every issue, WWDBeauty Biz includes the trends driving new products, personalities behind the business, retail analysis and competitive information, consumer research, business strategies and best practices, and category specific analysis. This Women's Wear Daily publication, which aims to put the beauty business into perspective, is directed toward an audience that includes both top retail management and industry and wall street executives to editors, beauty advisors, and stylists.

"Clearing up Cosmetics Confusion," FDA Consumer . May-June 1998.
LC Call Number: HD9000.9.U5 A1735 May-June 1998
LC Catalog Record: 72626332

Article discusses the FDA's role in the regulation of cosmetics, as well as the debate over drugs versus cosmetics, prohibited ingredients, and more.

Cosmetics & Toiletries. Carol Stream, IL : Allured Pub. Corp., c2001-present.
Published as Allured's cosmetics & toiletries magazine from 1999-2001.
Online: http://www.cosmeticsandtoiletries.com/
LC Call Number: TP983 .A222
LC Catalog Record: 2006205377

Long running industry news publication under various titles beginning as Beauty Fashion in 1916 with a name change to Toilet Requisites in 1921. See also Catalog record sv85006448.

Cosmetics & Toiletries. The Guide. Carol Stream, IL : Allured Pub. Corp., 2006 - present.
LC Call Number: TP983 .A2224
LC Catalog Record: 2006243169

This supplement to the trade publication, Cosmetics & Toiletries, serves as a guide to the ingredient suppliers by product category and region. Also includes a State of the Industry overview.

"Girl Power: Marketing to Today's Women." Euromonitor International. (October 22, 2007).
Not available in print at the Library of Congress.
Table of Contents

This strategy briefing is geared to marketing and selling multiple products to women including cosmetics (see particularly, the Consumer Market Opportunities section). Includes various charts and graphs.

Global Cosmetic Industry. Duluth, MN : Advanstar Communications, c1999 - present.
LC Call Number: HD9970.5.C67 .G57
LC Catalog Record: sn 99030130

Trade publication for personal care professionals covering the cosmetics and toilet preparations industries. They now have a web site under the name GCI Magazine.

"Perfumes, Cosmetics, and Other Toilet Preparations." Encyclopedia of American Industries. Detroit: Gale, 1994 - present.
LC Call Number: HC102 .E53 2011
LC Catalog Record: 2001223283

This chapter covers SIC 2844 (NAICS 325620, 325611) and contains information on the organization/structure, background/development, further readings, etc. of the industry. 2011 edition is available.

Polla, Ada. "The Changing Face of Beauty Distribution." Global Cosmetic Industry. March 2012; 180(2):24-28.

This article looks at the evolution in the trends of retail channels in cosmetics industry in the United States.

The Rauch Guide to the U.S. Cosmetics & Toiletries Industry. Manchester Center, VT : Impact Marketing Consultants, Inc. 2003/05 ed.
LC Call Number: HD9970.5.C67 R38
LC Catalog Record: 2004209732

Industry structure and current market information, from raw materials, to product categories, to the directory of hundreds of leading marketers. Economics section provides data on industry shipments; long-term growth and forecasts; prices; company performance; employment, expenditures, and productivity; transportation and geographical patterns; packaging; foreign trade; and government regulations. Other sections include technology and raw materials, information on color cosmetics and fragrances (men and women), hair care products, skin care (sun, men, foot care, facial, etc.), and an advertising, directory.

"Toiletries and Cosmetics. " Encyclopedia of Global Industries . Detroit: Gale, 1996 - present.
LC Call Number: HD2324 .E53 2011
LC Catalog Record: 97661013

Covers SIC 2844 (NAICS 325620) and contains information on the background and development, organization and structure, current conditions, and further readings. 2011 edition is available.

Walker Rob. "State of the Industry." Global Cosmetic Industry. June 2012; 180(5):32-39.

Publisher Summary: The article reports that while emerging markets remain primary drivers of beauty industry growth, developed markets played their part, specially the U.S., which posted its best performance in more than five years on the back of strong sales of premium brands.

Walker, Rob. "The Future Bright for Color Cosmetics Despite Economic Gloom." Global Cosmetic Industry, 180(3), 38.

Willett, Julie ed. The American Beauty Industry Encyclopedia. Santa Barbara, Calif. : Greenwood, c2010.
LC Call Number: TT958 .A44 2010
LC Catalog Record:2010002234

Over 100 entries on historical and current topics primarily on the late-19th and 20th-century American beauty industry including categories like gender, race, sexuality, and stages of the lifecycle.

Winter, Ruth. A Consumer’s Dictionary of Cosmetic Ingredients. 7th ed. New York : Three Rivers Press, c2009.
LC Call Number: TP983.A55 W57 2009
LC Catalog Record: 2010292417

Internet Resources

American Academy of Dermatology
http://www.aad.org/forms/pamphlets/default.aspx

This site includes a variety of pamphlets on various topics (acne, tanning, dermabrasion, etc.)

Beauty.com
http://www.beauty.com

Directed to consumers shopping for cosmetics, this web site can also be used for market research to determine major players and competitors.

Beauty Biz
http://www.wwd.com/beauty-industry-news/

The beauty/cosmetics area of Women's Wear Daily. Includes articles and information on the business and fashion end of the cosmetics industry.

Campaign for Safe Cosmetics
http://www.safecosmetics.org/

Cosmetics companies whose products meet or exceed current EU formulation standards are encouraged to sign the Compact for Safe Cosmetics. Only cosmetics companies who manufacture their own line of products can sign the Compact.

GCI Magazine
http://www.gcimagazine.com/

This is the online presence of Global Cosmetic Industry.

"Cosmetics & Beauty Supplies Stores Industry." United States Cosmetics & Beauty Supplies Stores Industry Report [serial online]. January 2012;:1-248. Available from: Business Source Complete, Ipswich, MA. Accessed November 23, 2012.

Publisher Summary: Several charts are presented which provide data and forecasts for the cosmetics and beauty supplies stores industry in the U.S. for 2009-2013 including employment trends, total sales of sub-industries, and estimated number of establishments.

Cosmetics Business
http://www.cosmeticsbusiness.com

This is the online presence for the publication Soap, Perfumery & Cosmetics. Website includes articles by topic, market reports (only available to subscribers), a company directory organized by activity, etc.

Cosmetics Index
http://www.cosmeticindex.com/

Source for cosmetic industry professionals to find information about all components of the industry. Includes news, articles, information on industry events, and has a small business resource center. The Industry Resources area includes links to relevant government agencies, associations and miscellaneous groups while the Resources area give information/links to relevant publications. The Raw Materials & Fragrances area has listings of relevant companies. There is also a Research Reports section which is under development as of August 2010.

CosmeticsInfo.org
http://www.cosmeticsinfo.org/

Sponsored by the Personal Care Products Council and its member companies. Resources include federal, state, international, and scientific links. Also includes information by product category (bath, hair care, nail, eye makeup, face makeup, etc.). Each product category includes a description of the products as well as ingredients and related information. The Safety area includes such topics as regulatory information/overview (U.S. and international), ingredient reviews, labeling issues, and scientific information.

CosmeticNews.com
http://www.cosmeticnews.com/

Web page for the publication Cosmetic News. Subscription is required for most of the data; site tends to focus on Europe and the international market.

The Cosmetic Site
http://www.cosmeticsandtoiletries.com/

Publisher for Cosmetics & Toiletries and Global Cosmetic Industry with links to both publications. Cosmetics & Toiletries has an archive of some of its issues and the China, Brazil, and Latin America editions of CT. Global Cosmetic Industry, the Global Business area, has market information, a state of the industry section, general news, and an archive of some issues.

Cosmetics. U.S. Food & Drug Administration - Center for Food Safety & Applied Nutrition.
http://www.fda.gov/Cosmetics/default.htm

The two most important laws pertaining to cosmetics marketed in the United States are the Federal Food, Drug, and Cosmetic Act (FD&C Act) and the Fair Packaging and Labeling Act (FPLA). Within the FDA's Center for Food Safety & Applied Nutrition there is an Office of Cosmetics and Colors. The web site contains information on such topics as laws, regulations, the international activities of the FDA, labeling, ingredients, and federal enforcement.

Datamonitor Industry Market Research
http://www.datamonitor.com/

In the Research Store there are many reports on the facial care and fragrances industry. Here are a few examples: "Facial Care - United States"; "Facial Care in China"; "Fragrances - United States"; "Anti-Aging & Beauty Attitudes And Behaviors"; "Global Make-Up market to 2011"; "Make-Up in Asia-pacific to 2011"; Reports must be purchased either as part of a subscription or on an individual basis. Issues of Datamonitor Industry Market Research are available to subscribers from 1998 to the present in the Gale Business Insights: Global database.

Independent Cosmetic Manufacturers and Distributors Association
http://www.icmad.org/

International association focused on keeping its members apprised of regulatory and industry developments. Most of the information is for members only or available only on a fee-basis.

Information Resources
http://symphonyiri.com/

The producer of this web site, SympathyIRI, tracks many areas, including the cosmetics industry, on a fee basis. Leigh Anne Rowinski has prepared a number of reports on the beauty industry for the company, and has spoken at NPD Groups' "Hot off the Press" Beauty Industry Event."

MMR (Mass Market Retailers)
http://www.massmarketretailers.com/

A business-to-business global mass retail newspaper targeting headquarters, regional and district level buyers in Supermarket Chains, Drug Chains, etc.

NPD Group
http://www.npd.com/

Provides retail tracking service for the prestige beauty market and includes consumer behavior insights. Detailed retail tracking information is provided for the American, French, and Italian beauty markets. Their data is not necessarily for sale as a market research product, however it can end up in articles. Also, their press releases can also offer insight into specific topics. For example: "Ethnicity and the Frequency of Beauty Product Usage," "The Internet Is One Of The Fastest Growing Channels For Buying Beauty Products," "Makeup Takes the Lead in the U.S. Prestige Beauty Industry," etc. Also, sponsors the "Hot off the Press" Beauty Industry Event."

Packaged Facts
http://www.packagedfacts.com/

Various reports. Examples include those for ethnic markets/products, products for specific age groups like "tweens" and teens, and natural/organic products. All reports are available on a fee-basis only.

Personal Care Products Council
http://www.personalcarecouncil.org/

The Personal Care Products Council (formerly the Cosmetic, Toiletry and Fragrance Association) is the national trade association for the cosmetic and personal care products industry and represents more than 600 member companies. The International Legal and Regulatory database is available to members only. The group has published the Cosmetic Ingredient Review since 1976 and has established the Cosmeticsinfo.org site for consumers to use to research ingredients and safety issues in the cosmetics industry.

The Science of Beauty: A Guide to Selected Resources
http://www.loc.gov/rr/scitech/SciRefGuides/beauty.html

Prepared the the Science Reference Section of the Library of Congress, this guide includes print and electronic resources for those interested in the science behind make-up and beauty products.

Skin Deep
http://54.243.178.219/skindeep/

Developed by the Environmental Working Group, this database allows users to search by product, ingredient, or company to discover what ingredients are in particular brands of makeup and whether the ingredients are harmful. Skin Deep contains information and online safety assessments for over 60,000 products, 7500 ingredients, in over 2500 brands sold by 1700 plus companies.

Sephora
http://www.sephora.com

Although designed for consumers shopping for cosmetics, the web site can also be used for market research for determining industry players and competitors.

ULTA
http://www.ulta.com/

Although designed for consumers shopping for cosmetics, the web site can also be used for market research for determining industry players and competitors.

Library of Congress Catalog Searches

Additional works on the cosmetics industry in The Library of Congress may be identified by searching the Online Catalog under appropriate Library of Congress subject headings. Choose the topics you wish to search from the following list of Library of Congress subject headings to link directly to the Catalog and automatically execute a search for the subject selected. Please be aware that during periods of heavy use you may encounter delays in accessing the catalog. Please check the other sections of this guide for catalog searches which relate to topics covered by those sections. For assistance in locating other subject headings which relate to this industry, please consult a reference librarian.

• Cosmetics
• Cosmetics industry--United States
• Beauty, personal
• Perfumes
• Lipstick
• Beauty culture
• Toilet preparations industry

 1."Boomers drive rising cosmeceutical fortunes, joined by younger shoppers," Research Alert. February 4, 2005. Volume 23, issue 3. page 1. As viewed in the Business Reference Suite database (Gale Cengage Learning), July 23, 2010.

 2. Walker, R. (2012). "The future bright for color cosmetics despite economic gloom." Global Cosmetic Industry, 180(3), 38. Retrieved from: ProQuest on November 23, 2012.

 3. "Natural & Organic Beauty Products Reach $9 Billion." Nutraceuticals World [serial online]. September 2, 2012;15:6. Available from: Business Source Complete, Ipswich, MA. Accessed November 23, 2012.

 4. Walker, R. (2012). "State of the industry." Global Cosmetic Industry, 180(5), 32. Retrieved from ProQuest on November 23, 2012.