≡ Menu

A Cosmetic Industry Overview for Cosmetic Chemists

In college, science majors spend their time learning complicated subjects like Calculus, Physics and Chemistry. Figuring out stuff like differential equations and bond angles of electron orbitals there isn’t much time or brain power left to learn the more mundane things taught in business classes.cosmetics industry

But when you get out of school, business subjects are important and you’ve got to take time to learn them. To be the most well-rounded and effective cosmetic chemist, you need to know about the markets for which you’ll be creating products. In this post, we’ll review the overall cosmetic industry to give you a basic understanding of where the money is and what products make the most.

Worldwide Cosmetic Market

If you look at the entire worldwide cosmetic industry, sales reach about $170 Billion dollars a year. It’s distributed pretty uniformly around the world with ~$40 billion in the Americas, ~$60 billion in Europe, ~$60 billion in Australia & Asia, and another $10 billion in Africa. The Western world spends a bit more per person but India and Asia are quickly catching up.

5 Primary Cosmetic Segments

So now that you know where all the money is spent, it’s helpful to know what people are spending their money on. The cosmetic industry (aka beauty industry or personal care industry) can be broken down into 5 segments. Sales are distributed roughly by the %’s given.

1. Hair Care – 20%
2. Skin Care – 27%
3. Fragrance – 10%
4. Make-up – 20%
5. Other – 23%

Market researchers like to break these up into even more segments but these 5 cover everything.

Hair Care Market

About 20% of all cosmetic products sold are for the hair. Shampoos make up the vast majority of this market since almost everyone uses shampoo. Other significant market segments include conditioners, styling products, hair color, and relaxers. Currently, the biggest players in this category are Procter & Gamble (Pantene) and L’Oreal.

Skin Care Market

The range of products that are offered for the skin care market are much more diverse than the hair care market. Skin care makes up about 27% of the total cosmetic industry and includes skin moisturizers, cleansers, facial products, anti-acne, and anti-aging products. Of all the cosmetics, skin care products can be some of the most expensive with 2 ounces of product routinely selling for >$200. Women do not mind spending big bucks to keep their skin looking young.

The biggest companies in this market include Procter & Gamble (Olay) and Unilever (Vaseline).

Make-up Market

The color cosmetic market represents about 15% of the cosmetic industry and includes anything from lipstick to nail polish. Included are things like blush, eyeshadow, foundation, etc. The array of products is vast and the number of color variations are practically infinite. You can spend a lot of time as a cosmetic chemist working on new shades of familiar products. The market is highly segmented so there isn’t really one dominant player. Maybelline an Clinique are just a couple of significant brands.

Fine Fragrance

This market segment has really taken a hit in the last few years but it still makes up about 10% of the cosmetic industry so some companies are still making money. This is the highest profit segment of the cosmetic industry but consumers are fickle. Only a few brands (like Chanel #5) can last for a long time. Fine fragrances come and go like fashion and companies have to continue to reformulate just to compete.

Other

The “other” category represents 23% of the cosmetic industry and is made up of things like toothpaste, deodorants, sunscreens, depilatories, and other personal care products not yet mentioned. Actually, many of these products could fall under one of the categories already mentioned but the industry likes to keep them separated whenever they do stories on the various markets. The dominant companies are many of the same already mentioned, P&G, L’Oreal, and Unilever.

While the cosmetic industry is considered a “mature” industry (that means business people don’t expect much significant growth) it is a pretty reliable industry. No matter what, people want to smell and look good so even when the economy hits a recession people will still buy soap. The recent economic conditions demonstrate, they do buy less, but they do keep buying.

{ 26 comments… add one }

  • Diane 08/15/2014, 11:10 am

    Would you know where I can get a breakdown of lipstick sales by state for USA?
    Thank you, DD

    • Perry Romanowski 08/16/2014, 8:56 am

      That’s specialty information for which companies like IRI or Mintel charge money. You can try to do a Google search and see if you can find old data. Or check C&T or Happi.com

  • Jason Vandenbrink 10/01/2013, 7:41 pm

    It’s incredible what an appearance oriented world we live in. And yet there is still so much obesity. I always get a kick out of women who spend a fortune on makeup, clothing, hair products, etc. and still remain over weight.

  • Nguyen Thi Thu Tra 09/30/2013, 12:11 pm

    Can you tell me about the cycle of cosmetic chemist industry? I’m researching about it to write an essay so I need some exactly data, please help me!

    • Perry Romanowski 09/30/2013, 2:25 pm

      I don’t know what you mean. Cosmetic chemists usually get degrees in science at a university then get hired into the industry.

      • Nguyen Thi Thu Tra 09/30/2013, 8:47 pm

        I’m sorry, I have a mistake. I want to know about the cycle of cosmetic chemical industry?

  • POOJA 06/14/2013, 3:50 pm

    Hi perry!
    Your information was so helpful.
    I am a pharmacy bachelor’s degree holder from India and presently residing in New York. Well, I am planning to start my career here and thought Pharmaceutics with specialization in COSMETIC SCIENCE will be a good option.
    But I am confused with the job opportunities in New York city or in Long Island where I stay..Mostly find them in New Jersey.
    If there are no job oppotunities near by , will it be appropriate to still go for the same? Please help me with this I am so confused!

  • reader 03/22/2013, 2:59 am

    Hi Perry, when was this article written? Was wondering how up to date it is, thank you!

    • Perry Romanowski 03/22/2013, 6:34 am

      The article was written in 2010

      • reader 03/22/2013, 2:57 pm

        thank you! :)

  • Pooja 03/21/2013, 2:10 pm

    Hi Perry – Do you by chance have a more recent figure for global sales in the cosmetic industry that you would be willing to share? Also, if you have it dissected by region, that would be so helpful. Thank you!

    • Perry Romanowski 03/21/2013, 2:18 pm

      Hello – No, this is the most recent data I have. I don’t really have a way of collecting this data so I only post when I stumble on it.

  • Tamojit Dey 01/29/2013, 5:39 am

    Hi,
    Great information about the cosmetics industry..Well, let me introduce myself as Tamojit Dey, a freelance researcher for various markets. For any research help you can contact me at tamojit.d@hotmail.com
    Will be happy to help you understand every possible market.
    Regards,
    Tamojit Dey

  • anti aging skin 08/04/2012, 4:37 am

    I simply couldn’t depart your site prior to suggesting that I actually enjoyed the standard info an individual supply on your visitors? Is going to be again continuously to check out new posts

  • Tan Darryl 07/13/2012, 6:12 am

    Hi
    Would you by any chance have any information regarding the global cosmetic industry sales for 2005-2011?

    • Perry 07/16/2012, 1:22 pm

      Tan. The latest data I have is from 2008 and that is posted in this article.

  • Brandie Ford 01/12/2012, 8:50 pm

    I am in the embryonic stages of building my brand and I have much market research to do. I am wondering if you can provide the earings of my direct independant cosmetic competition
    1.Milani
    2.Iman
    I have tried in vain to find the information for my investors.if you can help in any way I would be ever grateful.

    • Perry 01/25/2012, 5:57 am

      Sorry, we do not have that type of specific information.

  • Mamata Pal 11/24/2011, 8:57 am

    How does Chanel work in India on franchising or licensing?
    plz let me know as I am doing a project on Growth strategy of Chanel in India.

  • Bill Bryan 08/17/2011, 9:48 pm

    Dear Sir/Madam:

    We desperately need market research concerning skin care revenues for USA for 2010 and forecasts for 2011-2016 or so.

    Specifically, we need information for anti-aging products.

    Need is urgent for developing business plan.

    Please respond ASAP.

    Thank you so much,
    Bill Bryan

  • gawzie 04/28/2011, 9:19 pm

    please where can i found a market segmentation of uniliver products.thanks

  • megha jain 02/28/2011, 7:58 am

    Emeralde International Institute of Hair and Beauty

  • kuljeet 02/26/2011, 9:34 am

    hey
    cn u tell me the universities in india frm where i cn pursue the course for cosmetic formulator.

  • megha jain 02/07/2011, 8:04 am

    please tell me abt the companies and thier job profiles in india and specially delhi…

  • amol 11/01/2010, 2:24 pm

    plesse , tell me about the starting package for cosmetic chemist in india…….

Leave a Comment