Despite news of a pending recession, prestige beauty sales are showing healthy growth, hinting at consumer confidence—at least when it comes to self-care.
“Unit sales and revenue are both growing by double digits for beauty products sold in the prestige market, indicating that consumers are indulging in beauty products this year,” said Larissa Jensen, Beauty Industry Advisor, The NPD Group. “Fragrance sales will grow this holiday season, albeit slower than in years past, and makeup, skin care, and hair care should also shine during the holidays, maintaining the strong sales performance these categories have experienced so far this year.”
During the quarter, several highlights occurred within beauty’s key categories.
In makeup, beauty largest category, saw sales officially surpass pre-pandemic 2019 levels, with growth in both unit sales and revenue, versus the same period in 2019. As a testament to the viability of the “Lipstick Index,” lip makeup was the fastest growing makeup segment during the quarter, with sales rising by 32 percent. Overall, makeup grow sales grew 15 percent during the quarter to $2.1 billion.
Sales within the skin care category grew 14 percent to $1.7 billion, driven by clinical brands, followed by natural brands. According to NPD, brick-and-mortar stores continue to bring in most of skin care’s sales gains, but the online channel still accounts for nearly 40 percent of sales.
Scent sales grew 11 percent to $1.3 billion, with growth drivers being a combination of continued consumer demand and increased average prices. NPD noted that average prices for fragrances grew faster than other beauty categories, fueled by consumers opting for higher concentration products and luxury brands that command a higher price point. And, while the online channel continues to expand, physical stores remain the most important channel for the fragrance category, accounting for over three-quarters of U.S. scent sales.
Hair care, which climbed 23 percent during the quarter, is the only category with a nearly even channel split between in-store and online sales. As consumers continue to prioritize hair health, products with strengthening and restoration benefits are outpacing overall hair care category growth. Hair product sales, which totaled $853.8 million in the third quarter, continue to grow despite the category becoming less promotional. Over the past nine months, the category experienced a 2-point decrease in share of the units sold on promotion.