NPD: Beauty youth market shows signs of stabilization
PORT WASHINGTON, N.Y. — Teens’ and tweens’ regular usage of beauty products stabilized in 2011, following evidence in 2009 that the youth beauty consumer was becoming less engaged in the beauty category overall, according to a recent report by market research company the NPD Group.
Study results showed declines from 2007 to 2009 in the percentage of young consumers regularly using beauty products; however, according to the third installment of "Insight into the Youth Beauty Market" report by the NPD Group, there are some signs of improvement among both female tweens (8 to 12 years) and teens (13 to 17 years).
While the level of engagement in the category today does not appear to be back to pre-recession (2007) levels, the types of products being used have remained consistent with 2009 levels. Lip moisturizers/balms, body moisturizers/lotions and mascara continue to be the top three regularly used products among teens; and lip gloss, body washes/cleansers/gels and lip moisturizers/balms continue to be the top three beauty products regularly used among tweens today.
Average monthly beauty spending estimates among tweens and teens showed moderate increases relative to 2009, another indication that things are improving for young consumers in these age groups, according to NPD. Based on reported spending in the past month, tweens estimated spending an average of $9.80 on beauty products, up 60 cents from 2009 estimates. Likewise, teens report spending an average of $13.60 on beauty products in the past month, up from an average of $12.10 in 2009.
The price of beauty products is important to both age groups, and “price consciousness” is the self-image that female consumers in each age group identify with most often. According to NPD, teens appear to be even more concerned about price than tweens, with higher reported mentions of the statement “I am very cost-conscious when it comes to buying beauty products” describing them completely (42% versus 25%, respectively).
Few young beauty consumers report “paying full price” when purchasing beauty products, with two-thirds of teens and about 7-out-of-10 tweens indicating they “look for items that are on sale (66% versus 73%, respectively). Although more teens (37%) report “paying full price” than tweens (25%), the percentage of teens reporting they “pay full price” has been consistently decreasing over time since 2007.
“Far from the fickle and fiscally carefree image most adults associate with tweens and teens, youth consumers continue to be price-conscious and savvy shoppers like their older counterparts. These traits are reflected in their behavior as they continue to look for discount offers and display less willingness to pay full price for beauty products,” stated Karen Grant, VP and senior global industry analyst for the NPD Group.
“However, it’s not only about the lowest price; it’s [also] about what they feel they are getting in return for their money that influences their choices. The overwhelming majority of girls 8 to 12 years old tell us that they look to their parents and siblings to see what beauty products they are using, and that helps them decide what to buy and use. This underscores the importance of brands building strong emotional connections with consumers and staying connected. In some sense, love for beauty products and brands can be thought of as family heirlooms, passed on from generation to generation,” Grant added.
Majestic Drug continues family-owned business tradition with new VP
SOUTH FALLSBURG, N.Y. — Majestic Drug, a manufacturer of niche oral care and personal care products, has named David Fishman as VP.
"We are very proud of our heritage of family involvement in Majestic for over 50 years" Majestic Drug president Larry Fishman said. "My father, Sam Fishman, bought the company in 1960 and brought me on as plant manager in 1970."
“Now, over 50 years after my father started it all, I am thrilled that my son David has joined the family business. He brings fresh ideas and a new energy and perspective into the company that will be a tremendous asset as we continue to grow. He will be instrumental in all aspects of the company including product development, marketing and sales," Fishman said. "David has been involved with the company since he was a kid, and even when he was teaching math in Arizona we would often find time to discuss the business. We welcome him and are really excited about what his presence here will add to the company,"
Majestic Drug’s product portfolio includes Dentemp O.S. dental repair, Reline-It denture care and Kutkit styptic awabs.
Coty withdraws bid for Avon
NEW YORK — Just days after Coty upped its proposal for Avon, the former has decided to withdraw its offer, citing Avon’s “delay and unwillingness to engage in discussions.”
“We believe that we provided the board with ample time to respond, particularly since it has already had months to consider our initial request. Yesterday, we received a two-sentence email indicating, without explanation, that Avon’s board would need another week to consider our request. Since receiving [the] email, we have reached out to Avon’s board, management and advisers to understand why additional time is needed, but we have received no explanation,” Coty stated in a May 14 letter to Avon.
Coty told Avon in a letter dated May 9 that it was revising its proposal to $24.75 per share from $23.25. “We are revising our proposal to $24.75 subject to due diligence and the other conditions. This price represents a premium of [more than] 36% to the original undisturbed closing price on March 6, 2012, before our initial proposal of $22.25, and also represents [more than] $1 billion of incremental value to your shareholders, despite a materially weakened outlook for your business,” Coty wrote in the May 9 letter.
Coty had requested that Avon respond to the revised proposal by the end of business on May 14. Avon responded to the revised proposal, indicating that it was considering the sweetened bid and its board expected to respond within a week.
In the latest letter dated May 14, Coty stated that since it submitted its revised proposal, and despite repeated requests over the last 24 hours, no one from Avon’s board or management has been willing to speak with Coty.
“Two months is enough. Consequently, as our deadline to begin discussions expired today [May 14], our proposal is withdrawn. It is time for Coty Inc. to move on and pursue other opportunities,” Coty stated in the letter.
In light of the news, Morgan Stanley analyst Dara Mohsenian stated in a research note that, “Clearly, we expect shares will be weak on this news. While we do believe there is still some strategic potential at Avon, as another bid could emerge or Coty could conceivably come back to the table, the stock is likely to trade more on fundamentals now.”