In the first quarter of 2023, U.S. prestige beauty industry sales reached $6.6 billion, a 16% increase versus Q1 2022, according to point-of-sale data from Circana (formerly IRI and The NPD Group). In comparison, the mass beauty market generated $7.0 billion and grew 10%.
“Following a stellar 2022, the beauty industry continues to bask in the glow of growing sales,” said Larissa Jensen, Beauty Industry Advisor at Circana. “The first quarter results reinforce beauty’s resiliency and unfaltering position as an indispensable category. As the prestige and mass industry lines blend, a clear picture of the complete beauty market becomes particularly important for brands and retailers to determine ‘where to grow from here’ and best harness the purchasing power of a consumer base that is already loyal to its products.”
As the fastest-growing category during the quarter across prestige and mass, makeup captured close to one-third of complete beauty sales revenue. Circana points to the “Lipstick Index” phenomenon and a “treat” mindset as helping drive sales. Lip was the fastest-growing prestige makeup segment, up 43%, with higher-priced designer brands growing even faster.
The mass market showed that it still holds court in skin care as the sector outpaced sales growth of facial skin care (13%) compared to the prestige sector (10%). In the prestige skin care market, clinical brands grew faster than natural brands, regaining leadership share, as new launches from clinical brands played a role in fueling sales.
Gift sets and mini sizes outperformed in the prestige fragrance market. Sales of fragrance gift sets sold in the prestige market grew by 31%, helped by more dedicated shelf space and consumers finding value in these types of products. Prestige fragrance under an ounce accounted for nearly 40% of unit sales in Q1, a 3-point increase versus last year – appealing to consumers looking for easy to carry fragrances, or to own a luxury fragrance at a lower price-point.
Hair experienced the highest year over year average price increase among all prestige beauty categories, driven by an increase in sales of products priced above $30. Sales of prestige hair products addressing hair health, such as heat protectants, leave-in treatments, scalp care, and hair thinning products outperformed the overall category. While the mass market dominates when it comes to hair product sales capturing three-quarters of total hair sales volume, sales in the prestige market continued growing at a faster clip in Q1, buoyed by treatment products.