Beauty Industry

Ethnic Beauty Spending Tops $8.4 Billion

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By: Jamie Matusow

Editor-in-Chief

Bolstered by ethnic-specific hair, beauty, and cosmetic (HBC) products seeing double digit growth between 2001 and 2006, overall purchases of both ethnic-specific and general-market HBC products by Asians, African Americans, and Hispanics are set to top $8.4 billion by year’s end, according to the latest market research from Packaged Facts. Ethnic Hair, Beauty and Cosmetic Products in the U.S. pegs the current market for ethnic-specific HBC products at nearly $1.9 billion, a 19% gain over 2001 figures. Yet this is only a portion of what ethnic consumers actually spend on hair relaxers, nail and lip care, make-up, and other HBC products. General-market HBC purchases ring up at about 3.5 times more than ethnic-specific, with this year’s general-market purchases expected to total over $6.5 billion. Yet the market remains difficult to target. After being drawn to high-end, “non-ethnic-specific” prestige-style HBC products early this century, the fading novelty factor coupled with ethnics’ special grooming needs has caused the ethnic sector to settle into a pattern of interspersing use of traditional ethnic-specific products with non-ethnic-specific splurge items. In fact, there are strong indicators that retail channels are blurring, with pop-prestige chains warming up to ethnic-specific fare. Meanwhile, mass retailers’ expansion now includes prestige-often “Dr. Endorsed”-products as well as low-end premium products. “Ethnic consumers are not just choosing ‘ethnic’ or not. They’re also looking at high-end versus value, chemical versus organic, and the latest fad versus ‘urban style’,” said Don Montuori, the publisher of Packaged Facts. “Marketers should find that a more holistic approach to product offerings as well as more diverse retail promotional efforts will fare well with this rapidly growing demographic.”

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