Overview of the U.S. Cosmetics Market | ATTB Exporter
Preeyapat C.
International Trade | Import-Export | Product Sourcing | Online Marketing | Global Market Insights
The U.S. cosmetics market has shown remarkable resilience and growth, particularly in the wake of the COVID-19 pandemic. As a significant segment of the beauty industry, color cosmetics have experienced continuous expansion, driven by evolving consumer preferences and market dynamics. This article delves into the current state of the U.S. cosmetics market, examining key trends, leading players, distribution channels, and emerging opportunities.
1. Industry Overview
In the beauty market, color cosmetics have consistently been popular and experienced steady growth, especially following the COVID-19 pandemic. In 2023, North America held the largest market share globally, accounting for 30.47% of the total market share.
The retail sales of cosmetics in 2023 reached $20.75 billion, marking a 9.1% increase from 2022. Skin cosmetics saw the highest sales in 2023, totaling $8.30 billion, representing a 13.1% growth from the previous year. Euromonitor forecasts a 5% growth in retail sales of cosmetics in 2024.
2. Cosmetics Market in the United States
In 2023, the U.S. cosmetics market was segmented by product type as follows:
Key Market Shares of Major Cosmetic Producers in 2023
3. Retail Channels
Retail distribution channels for cosmetics in the U.S. in 2023 were divided into two main categories:
1. Offline Retail Channels: Accounting for 75.9% of the market. This includes hypermarkets, supermarkets, department stores, beauty specialists, and pharmacies.
2. Online Retail Channels: Making up 24.1% of the market. This channel has seen significant growth and popularity over the past five years.
4. Industry Situation in 2023
In 2023, lipstick products experienced the highest growth, impacting overall cosmetics sales. However, an increase in consumer behavior emphasizing value for money has narrowed the gap between the growth of mass and premium products.
Key factors driving the growth of lipstick products include continued consumer use, new innovations by brands, and the influence of TikTok. Euromonitor’s consumer survey revealed an increased use of lip liners, lipsticks, and lip tints, with growth rates of 16%, 13%, and 11%, respectively.
Premium lipstick products maintained a larger market share compared to mass products, though the gap has been narrowing due to the influence of "Dupe Culture" on Gen Z and Millennials via TikTok. This culture promotes alternatives that mimic the design, functionality, or features of well-known brands, leading to a reduction in the sales gap between premium and mass products. Consumers are increasingly comparing value for money.
The rising cost of living and higher prices in the U.S. have led to a more positive view of Dupe Culture among consumers. They see it as a smart spending strategy and proudly share their savings with others. Comparisons on TikTok include Milani's Color Fetish Matte Lipstick vs. Charlotte Tilbury’s Pillow Talk, and elf Beauty’s Pout Clout vs. Tarte’s Juicy Maracuja Lip Plump.
Growth of Skin-Care Infused Cosmetics
Euromonitor’s 2023 survey showed that 49% of consumers prefer a light or natural makeup style. There is increased interest in products that offer skin benefits, leading to a rise in demand for cosmetics with skin-care ingredients. Manufacturers are developing products to meet this demand, such as lightweight concealers with skin-nourishing ingredients.
Brands like Haus Labs by Lady Gaga have introduced skin-care infused foundations like Too Faced Cosmetic Born This Way Skin Tint, while Glossier emphasizes skin-care ingredients in its Stretch Fluid Foundation.
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Consumers are also focusing on pre-makeup skin preparation products like powders, primers, and base creams. Products such as E.L.F.’s Prep and Hydrate Balm and Charlotte Tilbury’s setting/blurring powders are popular.
Blushers, Bronzers, and Highlighters
Blushers, bronzers, and highlighters have received positive feedback due to innovations and trends promoted on social media. New makeup techniques and products have contributed to sales growth, with bronzers and highlighters seeing a 12% increase and blushes a 10% increase. Popular products include Patrick Ta’s Double Take Cream and Powder Blush and Milk Makeup’s Cooling Water Jelly Tint.
5. Trends and Opportunities
The expansion of cosmetics in retail stores like Target and Walmart supports the industry’s growth. These stores are adding beauty products and providing beauty experts to advise customers. Notable trends include increasing the availability of popular brands and offering clean beauty products.
For manufacturers, opportunities exist in supermarkets, hypermarkets, discounters, and warehouse clubs, where sales have shown growth. Beauty specialists like Ultra Beauty are expanding their product offerings and loyalty programs, which also present opportunities for brands.
Emergence of Premium and Luxury Brands
Despite a shift towards value-oriented products, premium and luxury cosmetics remain promising. The demand for affordable premium brands has increased, with new entrants like Celine announcing a 2024 cosmetics line and Kim Kardashian’s brand adding new products in January 2024. Existing brands like Fenty Beauty are introducing new, affordable product lines to attract new customers.
Competition from Skin-Care Brands
The growth of both cosmetics and skin-care products has been notable, with innovations blending both categories. Products such as Charlotte Tilbury’s Hyaluronic Happikiss Lipstick Balm and Hourglass’s Phantom Volumizing Glossy Lip Balm merge color and skin care.
6. Regulations and Import Requirements
As of December 29, 2022, the Modernization of Cosmetics Regulations Act of 2022 (MoCRA) is in effect. This law introduced new requirements for cosmetic product facility registration and product listing under the Federal Food, Drug, and Cosmetic Act. Businesses importing cosmetics into the U.S. must comply with MoCRA and FD&C Act regulations to ensure product safety.
Previously, the U.S. FDA did not require cosmetic manufacturers to register, but MoCRA now mandates registration, replacing the Voluntary Cosmetic Registration Program (VCRP). Businesses interested in the U.S. market should review MoCRA and FDA registration details for compliance.
Conclusion
The U.S. cosmetics market is evolving with trends towards skin-care-infused products, premium and luxury brands, and expanding retail opportunities. Manufacturers and importers must stay updated on market trends and regulatory requirements to succeed in this dynamic industry.
Source: DITP, Euromonitor
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