U.S. Beauty Industry Continues to Grow Despite Economic Challenges

The U.S. beauty industry has shown resilience in the first quarter of 2024, with prestige beauty sales increasing by 9% compared to the same period last year, while the mass market sector saw a more modest growth of 2%, according to Circana.

In the prestige segment, fragrances led with a 13% increase in sales. Particularly notable were gift sets, including travel-sized sets, which grew by 22%, indicating a shift towards more affordable, smaller products. Despite a general move to lower-priced items, luxury products also saw significant growth, doubling their sales from last year.

The influence of high-income families with children, also known as the ‘Gen Alpha effect,’ was significant. Families earning over $100,000 per year with children doubled their spending on prestige fragrances compared to families without children. This group also saw their average spending increase fivefold.

Skincare sales in the prestige category grew by 10%, the fastest growth seen in both the prestige and mass markets. Body sprays and face serums were the standout products, with body spray sales nearly tripling since last year. The data indicates that more consumers are buying skincare products more frequently and spending more each time.

Makeup, however, was the slowest-growing category in both market segments, though lip makeup saw a strong increase of 26%, driven by sales of tinted lip balms and oils.

Hair care products also saw strong growth, with sales increasing by double digits. Products aimed at hair health, such as treatments for hair thinning and loss, oils, serums, scalp care, and heat protectants showed significant sales increases. Among these, celebrity-branded products were the fastest growing, with a 64% increase in sales.

Larissa Jensen, Global Beauty Industry Advisor at Circana, provided insight into the industry’s performance. “The slowdown in growth that we are seeing is a reflection of an industry stabilizing after strong growth over the past two years,” she said. “However, the industry remains strong, with sales growing by over $600 million in Q1. There is continued enthusiasm for new products and brands, and with upcoming events like Mothers’ and Fathers’ Days and summer activities, beauty products that enhance our appearance and mood remain in high demand.”

This article, "U.S. Beauty Industry Continues to Grow Despite Economic Challenges" was first published on Small Business Trends