MMR: Mass Market Retailers, January 11, 2021

SUPPLY SIDE Pandemics Imprint on Category Expected to Be Long Lasting NEW YORK The pandemics influence on beauty regimens is expected to shape the retail category for the foreseeable future as consumers continue choosing ingredients that boost health and rewarding businesses that are responsive to their changing needs BEAUTY The coronavirus has accelerated emerging trends the focus on self care the DIY emphasis beauty from inside out and the inclusion of dietary products that enhance healthy skin and hair From our proprietary consumer insights work we know most beauty enthusiasts are maintaining or expanding their skin care routines as a form of self care Mary Dillon chief executive officer of Ulta Beauty Inc told investors last month during an earnings call Increased interest for home skin care treatments as well as newness in innovation in body treatments face serums and eye creams are driving strong category growth she said Leaning into these trends and the opportunity to increase our market share in this category we continue to expand our assortment while also increasing space and marketing support for this key growth category Ulta Beauty is among retailers converting retail space formerly allocated to traditional makeup brands to accommodate new skin care options And the retailer is relying on more clean and conscious brands It recently introduced Conscious Beauty at Ulta Beauty a celebration of brands that stand on five pillars clean ingredients cruelty free vegan sustainable packaging and positive social impact The nations retail pharmacies are also making strides in fusing beauty with wellness For example CVS Pharmacy has introduced more than 1000 clean skin care products including Pixi Simple and Yes To Additionally the chain introduced its Live Better by CVS line for customers looking to self care alternatives Pharmacy chains have also created antibacterial departments within beauty aisles with products such as hand sanitizers masks and soaps Apps that permit consumers to virtually try a product before buying continue to impact the beauty category according to Perfect Corp a provider of beauty technology and creator of the YouCam Makeup app that has emerged as a popular tool among Gen Z shoppers those between the ages of 8 and 25 Generation Z holds a whopping 143 billion purchasing power and lives up to its name as the digital generation They rely heavily on technologies like artificial intelligence AI and augmented reality AR for both convenience and entertainment aiding them in all elements of their life Perfect Corp said in its Q4 Global Beauty Trends Report Virtual try on gives beauty shoppers confidence that the eye coloring and hairstyling products theyre buying will allow them to express themselves and celebrate their individuality according to the report The NPD Group in its annual holiday study explained the influence that face coverings have had across the cosmetics and apparel categories Covering the nose and lips protective face masks place greater emphasis on the wearers eyes Consequently dollar sales of lip makeup declined faster than all other makeup products year to date NPD said in the report Compared to lip and face eye makeup has seen the softest sales declines and gained market share according to the report which noted that under the mask setting sprays which may help consumers solve the problem of keeping makeup in place have notched notable sales gains While protective face masks focus attention on the eyes we still want to keep the rest of our face looking good for when the mask comes off not to mention keeping the mask itself free of smudges said Larissa Jensen NPDs beauty industry advisor Masks have created a shift in our beauty behavior and elevated the categories that address the consumers new set of needs Natallia Bambiza makeup category analyst at NPD sees a role for cosmetics in helping to bring back a sense of normalcy in 2021 Ultimately makeup is the beauty category consumers turn to for fun which is something we all need to lift our spirits now and then she said in a recent NPD blog post Throughout the pandemic makeup has been seen as a category less in demand compared to the rest of the beauty industry Bambiza said However while many makeup consumers are currently using less color cosmetics 83 of those who use it less often due to the pandemic say that they will return to their regular routines once things get back to normal Nail Polish For 12 Weeks Ended 11 29 20 Top Brands DOLLAR SALES 1285 mil 93 Percent Change vs Prior 12 Months Supermarkets 78 Drug Stores 35 Dollar Sales UNIT VOLUME 283 mil 04 Percent Change vs Prior 12 Months Supermarkets 2 Drug Stores 95 Unit Volume 1 Essie 180 mil 21 mil 2 Sally Hansen Miracle 152 mil 18 mil 3 Sally Hansen Insta Dri 135 mil 28 mil 4 Opi 101 mil 12 mil 5 Essie Expressie 61 mil 07 mil 6 L A Colors Color Craze 53 mil 27 mil 7 Private Label 50 mil 14 mil 8 Sally Hansen Hard As 45 mil 14 mil 9 Essie Gel Couture 38 mil 03 mil 10 Sally Hansen Color 36 mil 05 mil Total of supermarkets drug stores discount stores military commissaries and selected warehouse clubs and dollar stores Source IRI More Retailers Get Skintimate Razor SHELTON Conn Edgewell Personal Care continues to adapt to the self care beauty trend gaining momentum during the pandemic Edgewells female grooming unit is responding to the trend by rolling out its Skintimate refillable razor to more retailers in 2021 With consumers isolated from friends and family members taking time for self care has become increasingly important says Anthony Pietrini head of marketing for Edgewells female grooming business The shower is a place women gravitate to as a haven of sorts to help escape and briefly recharge The Skintimate brand is designed for consumers who are looking for a source of positive energy so our razors and shave gels give women a spiritlifting skin caring experience Self care has become more of a priority With women making fewer salon visits during the pandemic the Schick Hydro Silk brand is seeing heightened demand for its dermaplaning and brow shaping tools that help women maintain beauty routines from home Dermaplaning is a skin resurfacing procedure intended to give the skin a smoother appearance Brow shaping specifically has been a major success for the brand Pietrini says Our browshaping tools have been trending in or near the top 10 best sellers of Amazons total beauty and personal care items since August With women covering their faces whenever they venture outside their homes Hydro Silk launched an advertising campaign with the theme that brows are the new lips emphasizing eyebrows as the new focal point of the face and reminding women to keep their brows trimmed to suit individual preferences Daily Concepts Premieres Two Brushes VERNON Calif Sustainability is top of mind as Daily Concepts heads into 2021 with newly launched brushes to promote alongside its commitment to its mantra of showering the world with love Daily Concepts has been implementing innovative ways to reduce packaging and limit its environmental footprint since the launch nine years ago of its Daily Body Scrubber which served as a catalyst for development of functional planet friendly personal care items Subsequent launches a Daily Shampoo Bar and the Bio Cotton Makeup Remover were also designed The company has over its history limited its environmental impact to reduce use of nonrecyclable plastics in beauty products Its new Daily Concept brushes Dry Facial Brush and the Daily Sisal Brush feature natural vegan and recyclable materials The company is promoting the brushes as it builds on the success of its Daily Lip Scrubber and markets its subscription boxes with names like FabFitFun and BoxyCharm which are designed to help introduce self care accessories to consumers who dont already use them MMR January 11 2021 43