Consumer enthusiasm for premium ranges is continuing to bloom, and 2014 has seen a rise in brands angling to make the most of this trend.
Fashion retailer Forever 21 moved into ‘affordable luxury’ with their recently launched premium cosmetics collection, and Unilever has recently confirmed its focus on the trend.
We take a look at the current state of the top tier beauty segment.
Premium line products are becoming big business in the US, with HSBC luxury-goods analyst Antoine Belge observing this trend dominated in the US during 2013: "Trends in luxury consumption in the US have continued to outperform overall consumer trends.”
The luxury goods trade enjoyed a particularly healthy growth in the US for 2013, of a 4% increase on 2012, outstripping that even of China (2.5%), according to a recent Bain study.
This trend towards premium in the US is being mirrored internationally, as global recovery from the recession fuels consumer spending.
British luxury beauty grew by around 7% in 2012 to reach a value of €800m, far higher than the regional average growth of 3%, driven largely by domestic demand, according to Euromonitor International.
According to Euromonitor figures, premium beauty sustained its growth levels last year, aided by the strong performance of premium skin care, which outshone all other categories.
For example, China’s premium beauty is seeing strong growth, and is set to add a further $4.5 billion by 2017, resulting in sales of premium cosmetics in Asia Pacific (estimated $6 billion) to exceed any other region.
Brands in action
At this year’s WWD Beauty CEO Summit, Dave Lewis, Unilever president of personal care, confirmed the new focus on premium, which the company is set to implement alongside a retained emphasis on their current more masstige ranges.
“We built our success by making our products accessible to billions of people around the world. But the opportunity to think up through the pyramid is clear, the case to build a more premium portfolio compelling,” the industry key player said.
Some moves by Unilever to broaden its premium offerings have already been seen: one of the most recent launches by the company is Dove’s new premium skin care range for women.