Beautiful Thinking.
The event touched upon so many interesting topics covering the multifaceted and often complex world of beauty and wellness. Longevity was a thread throughout which is a passion point for Iryna Kremin, founder of INNOCOS.
One of the key speakers highlighted was Luis Simoes from World Data Lab. The future of Beauty is a fascinating one; just when you think surely that there can surely be no more growth, think again. Now it is the turn of the developing markets.
It was especially interesting to hear where this growth is emerging. Here at Free The Birds, we advise our clients to steer away from briefs dedicated only to certain age demographics. For our team, we firmly believe it can stifle the creative journey. We are much more interested in consumer attitudes, living by our much-loved motto, ’attitude not age’.
The beauty industry is set to undergo a transformative journey over the next decade. With an expanding customer base and dynamic shifts in spending power, brands need to stay ahead of these trends to capture new opportunities in their shifting audiences and their collective and specific needs and demands.
In the next 10 years, the global consumer base will expand by 1.2 billion people. This surge represents a major opportunity for beauty brands to tap into new markets and demographics, driving unprecedented growth.
On average, consumers allocate around 3% of their budget to personal care, with 1% dedicated specifically to beauty products. This underscores the significant role of beauty within the broader personal care market, highlighting its importance for future investment and development.
Currently valued at $560 billion, the beauty industry is poised to grow at an annual rate of 5%. This growth outpaces general consumer spending, with some regions expected to see even more rapid expansion. Brands that can capitalise on this momentum stand to gain substantially.
While Gen Z is the most dynamic cohort with significant growth potential, Millennials and Gen X will remain the largest spenders for the next 20 years. Focusing on these generations will be crucial for sustained revenue and growth.
While product sales are crucial, beauty services such as spa treatments, cosmetic procedures, and beauty salons are projected to grow even faster. This shift opens new avenues for revenue and customer engagement, as consumers seek more comprehensive beauty experiences.
The U.S., China, and India will drive half of the beauty industry’s growth over the next decade. However, brands should not overlook the substantial opportunities in under-the-radar countries, particularly in Asia and Africa, where emerging markets are ripe for expansion.
Countries in Asia and Africa are set to see their beauty markets double. Economic growth and rising consumer spending power in these regions will create fertile ground for brands to establish a strong presence and capture market share.
Skincare is set to lead the way with an annual growth rate of 5.5%. Makeup and hygiene products will also see robust growth, driven by evolving beauty standards and increased health awareness. Brands should invest in these subcategories to capture the rising demand.
To capitalise on these growth opportunities, companies need to strategically allocate resources. This means focusing on high-growth regions, catering to affluent consumers, investing in innovative products, and tailoring marketing strategies to different demographics.
For us, there feels like easy wins to be gained in the short term, as we continue to build out longer term strategies. The short wins would be tapping into the 50+ market. All too often beauty forgets this demographic…perhaps now the Grey economy will make them see sense.
We’re at the threshold of a major transformation for the industry. As it braces for an impressive $300 billion growth over the next decade, savvy brands are beginning to recognising a golden opportunity in this older demographic. Traditionally, marketing efforts have centred around the youth, but it’s time for a shift. Consumers over 50 are wielding unprecedented spending power, and the future of beauty lies in their hands.
By 2050, this group will account for more than half of global spending. They are financially secure, health-conscious, and deeply invested in maintaining a youthful, vibrant appearance. However, despite their significant spending power, they remain an untapped market in the beauty industry.
Prioritising skincare and wellness, they are significant drivers of the longevity movement in beauty, seeking products that address wrinkles, age spots, and skin elasticity. This demographic is also fiercely loyal; once they find products that meet their needs, they tend to stick with them, providing brands with a stable and consistent revenue stream.
Brands like Jones Road and Studio10 Beauty represent and encapsulate this freshness of capturing and attitude and representing all walks of life, no matter the age. With this powerful group primed to be the early adopters positioned ideally for this future growth, who’s next?
As we navigate this evolving landscape, maybe keep these 10 key facts in mind. They not only highlight the immense potential within the industry but also provide a roadmap for where to focus our efforts. Embrace the change, invest in innovation, and capture the opportunities that lie ahead in the world of beauty.
A special thanks to Luis at World Data Labs, for sharing these insights and giving us a great deal of food for thought.
