Zenith Forecasts Recovery Of Cosmetics And Fragrance Advertising Through To 2022

Zenith Forecasts Recovery Of Cosmetics And Fragrance Advertising Through To 2022
B&T Magazine
Edited by B&T Magazine
SHARE
THIS



Growth in beauty and personal luxury advertising will remain below market average in 2021 and 2022, according to a new report from Publicis Media’s Zenith.

Decreased consumer demand for cosmetics and fragrances will restrain the recovery in beauty and personal luxury advertising to 1.7 per cent in 2021, according to Zenith’s ‘Business Intelligence – Beauty and Personal Luxury’ report, published today.

This is below the 4.4 per cent growth rate for total ad-spend in the 11 key markets included in the report: Australia, Canada, France, Germany, India, Italy, Russia, Spain, Switzerland, the UK, and the US, which account for 59 per cent of total global ad-spend.

Beauty and personal luxury is defined as the combination of four sub-categories: cosmetics, fragrances, hair care and skin care.

According to Zenith, beauty ad-spend will total US$7.5bn across these markets in 2021, and then rise to US$7.7bn in 2022, growing by 2.6 per cent, compared to 4.5 per cent for the market.

You can hear from Zenith Australia’s head of strategic insights, Kim Xavier, on some of the main insights from the report, below.

Beauty and personal luxury ad-spend fell roughly in line with the market in 2020. The sharp drop in spending on cosmetics and fragrances as people stopped meeting in person, due to social distancing restrictions, was mitigated by continued demand for both hair and skin care.

With hairdressers and salons harder to reach, consumers took hair care into their own hands at home. Skin care, meanwhile, benefited from the heightened desire for health-enhancing products during the pandemic.

During the recovery, though, overall demand for beauty will not change much as consumers remain reluctant to return to their pre-pandemic habits, reducing sales of cosmetics and fragrances.

Most beauty and personal luxury brands will not raise budgets substantially, Zenith noted, and will be more likely to redeploy spending from underperforming channels instead.

Ecommerce helps digital compensate for declining reach of magazines and TV

According to Zenith, beauty and personal luxury brands spend much more of their budgets on magazines and TV than the average brand.

The beauty category (defined as the combination of four sub-categories: cosmetics, fragrances, hair care and skin care) thrives on its ability to create emotional connections through imagery in a “high-quality environment”.

Zenith estimates that in 2020 beauty brands spent 18.3 per cent of their budgets on magazines advertising (4.3 times more than the average brand) and 42.2 per cent on television (1.6 times more than average). But while the effective reach of traditional media declines, consumers are turning to digital and social platforms in increasing numbers.

Globally, beauty and personal luxury brands have been slow to adopt digital advertising, spending 34.1 per cent of their budgets digitally in 2020, compared to 53.1 per cent for the market as a whole.

This, Zenith notes, is a result of the “historic lack of premium digital environments that support the high-quality brand imagery that beauty and personal luxury brands need to convey”.

It is also due to the difficulty the beauty industry has had adapting to ecommerce because consumers feel the need to sample and try on beauty products in person before committing to a specific product.

According to Euromonitor International, 11.8 per cent of beauty and personal luxury sales were through ecommerce in 2019, compared to 13.2 per cent for the market as a whole.

However, technologies like video-on-demand and connected TV, and social platforms like Instagram and TikTok, are creating new premium environments that showcase beauty and personal luxury brands effectively.

Brands have also greatly stepped-up investment in their ecommerce offerings since the start of the pandemic as a matter of necessity, Zenith reports, as bricks-and-mortar retail sales shrank. According to Zenith, digital channels are, therefore, becoming more valuable for both brand and performance advertising.

In Australia, as more and more interactions moved online in 2020, Zenith saw the use of cosmetics decline, with 52 per cent using cosmetics less than before the pandemic began, according to results from a ZenPoll conducted last week.

And while skin care remains of high importance, half of Australians have simplified their skin care routine and are investing more in their own self-care.

Zenith Australia’s head of strategic insights, Kim Xavier, said: “Although many people had to resort to purchasing cosmetics and skin care products online through lockdown periods, the in-store experience of purchasing these products is still very important.

“While 55 per cent are more likely to research beauty products online, only one in three are purchasing more of their beauty products online.

“This signals an opportunity for beauty brands to continue not just to accelerate their ecommerce strategies, but actually have a dual strategy focused on in-store engagement, while also driving greater innovation in online experiences through new technologies.”

Zenith estimates that the global beauty category increased its spending on digital advertising 2.8 per cent in 2020, despite the pandemic.

This was twice the 1.4 per cent growth rate of digital advertising across all categories, as beauty and personal luxury brands began to compensate for previous underinvestment.

Zenith forecasts average growth of 5.9 per cent a year in digital advertising between 2019 and 2022.

Beauty and personal luxury ad-spend on all other media will decline over this period, by between 1.2 per cent a year for TV and 12.4 per cent a year for magazines.

France and India to lead beauty and personal luxury ad-spend

Additionally, France is expected to be the best-performing beauty ad market over the next two years, growing by 13.3 per cent per year, on average. According to Zenith, this is a reaction to the depth of its decline in 2020, when beauty brands cut budgets by 32.9 per cent whole.

The market will start to recover quickly from this reduced base in 2021, but is still expected to be 13.8 per cent lower in 2022 than it was in 2019, Zenith noted, when compared to the 3.6 per cent average drop across all eleven markets over this period.

On the flipside, India is forecast to grow because of strong consumer demand, Zenith said. Beauty ad-spend was stable in India in 2020, and is forecast to grow at an average of 7.6 per cent a year as more consumers take up the habit of regularly buying beauty products.

Beauty and personal luxury ad-spend in India is forecast to be 15.2 per cent higher in 2022 than it was in 2019, Zenith said.

Across North America and the rest of Western Europe, demand will recover more slowly, leading to annual growth in beauty ad-spend of 1 to 2 per cent per year in Canada, Germany, Italy, Spain, the UK and the US.

“Growth in beauty and personal luxury advertising will lag behind the market while consumers remain cautious about travelling in public and meeting in person,” Zenith head of forecasting Jonathan Barnard said.

“But by investing in digital technology that embeds ecommerce into the heart of their operations, brands will prime themselves for more rapid growth when demand picks up.”

Please login with linkedin to comment

Zenith

Latest News

Nielsen Teams Up With TikTok To Unleash Greater Potential On Worldwide Marketing Insights
  • Campaigns
  • Technology

Nielsen Teams Up With TikTok To Unleash Greater Potential On Worldwide Marketing Insights

Nielsen, a global leader in audience measurement, data and analytics, has been selected to participate in TikTok’s Media Mix Modelling Program. TikTok’s program brings together leaders in media mix model marketing measurement to drive reporting consistency and quality for advertisers globally, allowing advertisers to gain more insights into the impact of marketing on the short-form […]

Emplifi First Quarter Report Shows Investments On Ads Are Up But User Engagement Is Flatlining
  • Marketing

Emplifi First Quarter Report Shows Investments On Ads Are Up But User Engagement Is Flatlining

Emplifi, the leading unified customer experience (CX) platform, today revealed the findings of its Q1 2022 analysis of social media spend across thousands of brands worldwide including those in Asia Pacific (APAC). While overall social media ad spend decreased in the first quarter following an impressive holiday showing, it remains significantly higher than a year […]

WPP’s Wavemaker Snares Audible’s $700 Million Media In Global Win
  • Media

WPP’s Wavemaker Snares Audible’s $700 Million Media In Global Win

Audible, a leading creator and provider of premium audio storytelling, today announced that Wavemaker will be its new agency of record  for paid media worldwide, effective May 25th, 2022. Audible reportedly spends about $US500 million annually on advertising and a reported $A50 million here in Australia. Audible, an Amazon company, is headquartered in Newark, New […]

Bohemia Australia Nabs Paul Hutchison From Wavemaker UK For CEO Role
  • Media

Bohemia Australia Nabs Paul Hutchison From Wavemaker UK For CEO Role

Paul Hutchison (lead image) will become CEO of Bohemia Australia, after four years as CEO of Wavemaker UK. Hutchison’s appointment comes after a global search to replace Bohemia founder and CEO, Brett Dawson, who announced his plans in March to take on a broader remit within the AUNZ Group. Hutch, as he is known, will […]

Ogilvy Unveils NSW Government’s Latest COVID PSA “Little Things”
  • Campaigns

Ogilvy Unveils NSW Government’s Latest COVID PSA “Little Things”

Ogilvy’s latest campaign for the NSW Government, “Little Things”, dramatises the idea of the little things that everyone should be doing to make a big difference to COVID safe life this winter. The OLV, social, radio, digital and OOH campaign was brought to life by creating miniature worlds, where COVID safety objects became the hero […]

Reconciliation Australia Launches National Reconciliation Week Campaign Via Carbon Creative
  • Campaigns

Reconciliation Australia Launches National Reconciliation Week Campaign Via Carbon Creative

Reconciliation Australia and Carbon Creative will launch National Reconciliation Week 2022 tomorrow, Friday, 27 May (running through to 3 June) with the theme ‘Be brave. Make change.’ The theme and campaign, developed by social change creative agency Carbon Creative in collaboration with emerging Torres Strait Visual Artist Tori-Jay Mordey, challenges all Australians—individuals, families, communities, organisations, […]

Pearman Media Appoints Tara Lamond As Group Business Director
  • Media

Pearman Media Appoints Tara Lamond As Group Business Director

Pearman Media has announced the appointment of Tara Lamond as group business director. “With experience on both the media and agency sides, including a stint in London, Tara brings a wealth of advertising and media expertise to this role, and we are thrilled to welcome her on board,” said Pearman Media founder and managing director, […]

Beyond the Rainbow: How Brands Can Better Connect with LGBTQIA+ Consumers All Year Round
  • Opinion

Beyond the Rainbow: How Brands Can Better Connect with LGBTQIA+ Consumers All Year Round

In this guest post, Jonathan Munschi (pictured below), head of sales for Twitter Australia, says initiatives such as Mardi Gras and Pride month give brands the ideal platform to connect with the LGBTQIA+, but, Munschi asks, why ignore the rest of the year? It’s time for brands to rethink their approach to LGBTQIA+ inclusive marketing. […]

Opinion

by B&T Magazine

B&T Magazine
Today Is National Sorry Day
  • Media

Today Is National Sorry Day

B&T would like to take time out from the usual programming to acknowledge National Sorry Day today.

‘The Sims 4’ Now Lets You Use Your Own Pronouns For Your Characters
  • Technology

‘The Sims 4’ Now Lets You Use Your Own Pronouns For Your Characters

The latest entry in EA and Maxis’ life simulation series, The Sims 4, has released a new update which allows players to customise their character’s pronouns. This new feature is available only in the English version of the game for the time being, with the developers saying that they will soon release it for other […]

Former Havas Head Of CX Michaela Aguilar Joins Martech Firm Acoustic
  • Technology

Former Havas Head Of CX Michaela Aguilar Joins Martech Firm Acoustic

Acoustic, a marketing cloud, digital experience and lifecycle pricing and promotion technology solution provider, announced today that Michaela Aguilar has joined the team as head of business partnership ecosystem. In her new role, Aguilar will be responsible for business development and expansion, working with partners and the Acoustic team to create new revenue opportunities in […]

Bastion Asia Solidifies Its Strategic Partnership With Adventi, Shanghai
  • Marketing

Bastion Asia Solidifies Its Strategic Partnership With Adventi, Shanghai

Asian marketing communications agency Bastion Asia has announced a strategic partnership with one of Shanghai’s leading PR agencies, Adventi, to drive greater digital and marketing innovation for Australian brands seeking to engage with Chinese audiences. Adventi, a marketing and communications agency specialising in luxury brands, is known for bringing some of Europe’s biggest luxury brands […]

Engine Creative Brings Innovation To The Lost Person Poster Using Modern Day Technology
  • Campaigns
  • Technology

Engine Creative Brings Innovation To The Lost Person Poster Using Modern Day Technology

Engine Creative has reinvented the missing person poster – re-thinking the standard design and introducing a high-impact live portrait – for UK charity Missing People to coincide with International Missing Children’s Day. The striking, high-tech digital posters show a ‘live’ image of the missing person appearing to move their eyes, smile and make facial expressions. […]

LinkedIn Puts The Spotlight On Indigenous Australians In The Workplace With New Campaign By Campfire X For Reconciliation Week
  • Campaigns

LinkedIn Puts The Spotlight On Indigenous Australians In The Workplace With New Campaign By Campfire X For Reconciliation Week

LinkedIn, the world’s largest professional network, has today launched the latest iteration of its #ConversationsForChange initiative with a new content series in partnership with Indigenous-led creative consultancy, Campfire X. The three-part series, titled ‘Change Starts With’, aims to highlight the often subtle, everyday moments that can impact Indigenous Australians in the workplace. The campaign encourages […]