Retail channel expansion for cosmetics and personal care products, from traditional retail stores, catalogs and direct sellers into the Internet and other home shopping channels, is having a significant impact on the way women, particularly, shop for and buy these products.

Online sales in particular are poised for significant growth. According to industry sources, e-commerce sales of cosmetics and fragrances are expected to grow 33% in 2005 to reach 12% of total category sales by the end of 2005.

Retail channel expansion for cosmetics and personal care products, from traditional retail stores, catalogs and direct sellers into the Internet and other home shopping channels, is having a significant impact on the way women, particularly, shop for and buy these products.

Online sales in particular are poised for significant growth. According to industry sources, e-commerce sales of cosmetics and fragrances are expected to grow 33% in 2005 to reach 12% of total category sales by the end of 2005.

Given the multitude of products in the beauty and personal care categories, and the dynamic retail environment, there are a number of powerful market drivers. These include demographics (gender, race/ethnicity and age), income and general economic conditions. Industry-related drivers include product innovation, as well as the growing effort by some manufacturers to expand offerings into both the mass and prestige channels. In the home shopping channel, broadband penetration and an increase in the number of TV programs selling cosmetics and other personal care products are driving sales.

However, the home shopping channel faces significant challenges--namely, the desire of consumers to sample products before purchase, and to have customer service support in choosing the right products.

This report focuses on the multi-channel retail distribution and purchase incidence of beauty and personal care products, and explores the reasons why consumers shop in various channels for such products. It also examines how consumers of beauty and personal care products may shop across multiple channels during product trial, usage, re-order, or in response to marketing or promotions by retailers or manufacturers.

Purchase activity across the following channels is explored through analysis of Mintel’s primary online consumer research:

Traditional retail channels:

Food/drug/mass merchants

Department stores

Specialty stores (Origins, Ulta, etc.)

Home shopping and direct channels:

Mail order/catalogs

Internet

TV infomercial/QVC

Direct selling agent (Mary Kay, Avon, etc.)

The report explores which products are purchased in which channels, and the reasons why consumers shop in multiple channels and how retailers and manufacturers’ multi-channel strategy can influence sales or shopping occasions.

Beauty and personal care products included in this report are:

Cosmetics: Eye shadow, eye liner, eye brow makeup, mascara; lip stick, gloss or color; concealer, face powder, foundation, and blush or cheek color.

Facial skin care products: Anti-aging creams or lotions, wrinkle-reducing or wrinkle minimizing products, microdermabrasion kits (scrubs, masks, peels), eye creams or gels, and acne skin care products.

Body skin care products: Body creams/lotions that moisturize and tone skin, anti-cellulite cream, creams and lotions that reduce or minimize stretch marks, anti-aging body lotions or creams, and soap, bath or shower products.

Hair care products: Shampoo and conditioner, hair styling products, hair styling tools like straighteners or blow dryers, hair loss products and hair removal products.

Fragrances: Men’s cologne and women’s perfume.

Men’s toiletries: Shaving products and grooming kits.

Children’s personal care products are excluded from the scope of this report, as are deodorants, hair coloring, and other personal care products not listed above.