Hair Colourants and Home Perms - UK - February 2004

SUMMARY

Since Mintel last reported on the hair colourants market in early 2002, therehas been considerable new brand activity as major manufacturers have continuedto improve and update their offering while new players continue to enter themarket. By contrast, however, home perms has become a minority sector withlittle to no investment by the leading brands.

Analysing the market's size, structure and consumers, Mintel's latest reportoffers a valuable insight into the major trends impacting on this market.Special emphasis is placed on investigating the argument that, because most haircolourant brands target the youth market, they are missing out on a potentiallylucrative older demographic, a part of the population that is growing. Usingexclusive consumer research and authoritative analysis, it provides a uniqueevaluation of the market's prospects, highlighting its sectors' strengths andweaknesses and areas of potential for marketers to tap into. Key industrytalking points covered include:

• -- The relationship between consumer confidence and market growth
• -- The increasing dominance of permanent products
• -- The inroads made into the distribution market by grocery multiples
• -- The challenges and latent potential created by the changingdemographics of the UK consumer
• -- The importance of changing men's grooming habits
• -- How to best target older consumers

The report covers the UK retail market for hair colourants and home perms.The hair colourants sector includes the following product categories:

• permanents such as L'Oreal's Recital and Féria Color which do notwash out of the hair
• semi-permanents such as Clairol's Loving Care which fade after six toeight washes
• tone-on-tone colourants such as Clairol's Lasting Care which arelonger-lasting than semi-permanents but are not permanent
• temporary colourants such as Wella's Shaders & Toners, which aredesigned to be washed in and washed out.

In addition, the definition includes highlighting kits, bleaches and hairlighteners, all of which work in much the same way as permanents. Also includedare coloured mousses, gels and waxes, although hair mascaras and hair colouringpencils are excluded as they are perceived to be 'hair cosmetics'. Colour-enhancingshampoos which add minimal colour to the hair are excluded.

TABLE OF CONTENTS

Introduction and Abbreviations

• Definitions
• Consumer research
• ACORN

Abbreviations

Executive Summary

• Consumer confidence drives market growth
• Permanent products increase dominance
• Dominance of major companies
• Grocery makes inroads
• Consumer research highlights challenges
• Future prospects

Market Drivers

• The grey consumer gains importance
• Figure 1: Trends and projections in the UK female population, by agegroup, 1998-2007
• Younger market still important
• PDI and trends in consumer expenditure
• Figure 2: PDI and consumer expenditure, at current and constant 1998prices, 1998-2007
• Figure 3: PDI and consumer expenditure, at current and constant 1998prices, 1998-2007
• Increase in technological advances
• Importance of celebrity
• Links with fashion and catwalk styles
• Relationship with the media
• Men's colourants - an emerging sector

Market Size

• Specialist technology boosts market value
• Figure 4: UK retail value sales of all haircare products, 1998-2003
• Figure 5: UK retail value sales of haircare products, by type, 2001 and2003
• Figure 6: UK retail value sales of haircare products, by type, 2001 and2003
• Conditioners dominate market growth
• Highlights of the colourants market
• Home perms miss out on market innovation
• Perms are pass

Market Segmentation

• Recent growth on the back of innovation
• Figure 7: UK retail value sales of hair colourants, 1998-2003
• Young consumers attracted by fashion brands
• Vivid colours are widely available
• Targeting blondes
• New segmentation by product type
• Figure 8: UK retail value sales of hair colourants, by product type,2001 and 2003
• Figure 9: UK retail value sales of hair colourants, by product type,2003
• Permanents benefit from NPD
• Gap in the grey market
• Highlighters/bleaches/lighteners rocket
• Tone-on-tones and semi-permanents lose popularity
• Temporary colourants - reflecting fashion trends
• Home perms fall out of favour
• Figure 10: UK retail value sales of home perms, 1998-2003
• Figure 11: UK retail value sales of home perms, 1998-2003

The Supply Structure

Hair colourants - two companies dominate

• Figure 12: Manufacturers' brand shares in the hair colourants market,2001 and 2003
• Figure 13: Manufacturers' brand shares in the hair colourants market,2003
• L'Oreal Paris
• Garnier
• Clairol
• Wella
• Schwarzkopf & Henkel
• Other brands
• Own-label

Home perms

• New product development

New Product Briefs

• December 2003
• October 2003
• July 2003
• June 2003
• May 2003

Distribution

• Multiple grocers gaining on chemists' dominance
• Figure 14: UK retail sales of hair colourants, by outlet, 2001 and 2003
• Boots focuses on specialisation
• Superdrug targets youth
• Grocers expand ranges

Advertising and Promotion

• Above-the-line spend boosted by new launches
• Figure 15: Main monitored media advertising expenditure on haircolourants, 1998-2003
• L'Oreal continues marketing dominance
• Figure 16: Main monitored media advertising expenditure on selected haircolourant brands, 2003
• Support non-existent for home perms
• Focus below the line is on price
• Figure 17: Selected below-the-line promotions of hair colourants,August-October 2003

The Consumer

• Usage of home hair colourants
• Figure 18: Weight of usage of hair colourants among women, 1999-2003
• Increase in hair colourant usage
• Opening up the grey market
• Figure 19: Weight of usage of hair colourants among women, by age andsocio-economic group, 2003
• Different products for different age groups
• Frequency dictated by product type
• High income consumers prefer to be pampered
• Low usage among the retired
• Figure 20: Weight of usage of hair colourants among women, by lifestage,presence of children and Mintel's Special Groups, 2003
• Medium/heavy usage among family and third age consumers
• Peak usage in mothers with young children
• Targeting households with more than one user
• Figure 21: Weight of usage of hair colourants among women, by maritalstatus, working status and household size, 2003
• Competition with salons may be greatest in London
• Figure 22: Weight of usage of hair colourants among women, by region,2003

Types of hair colourants used

• Figure 23: Type and colour of hair colourant used in the last two years,2001 and 2003
• Permanents dominate market
• Brunette - the new blonde
• Figure 24: Type and colour of hair colourant used in the last two yearsby purchasers, 2001 and 2003
• Figure 25: Comparison of type and colour of hair colourant used in thelast two year, by purchasers and total sample, November 2003
• Brown permanent shades increase in popularity
• Figure 26: Shade chosen, by level of permanency, 2001 and 2003
• 35-44s well placed to trade up to highlighting and multi-tonal products
• Figure 27: Profile of colourant users, by level of permanency, age andsocio-economic group, November 2003
• Opportunities for cross-promotion
• Figure 28: Profile of colourant users, by level of permanency, lifestageand Mintel's Special Groups, November 2003
• Targeting the correct neighbourhoods
• Figure 29: Profile of colourant users, by level of permanency, maritalstatus, working status and household size, November 2003
• Figure 30: Profile of colourant users, by level of permanency, regionand ACORN categories, November 2003
• Targeting users via relevant media
• Figure 31: Profile of colourant users, by level of permanency, mediausage, TV viewing and supermarket usage, November 2003
• Premium brands should focus on red
• Figure 32: Profile of colourant users, by colour used, by age andsocio-economic group, November 2003
• Blonde colourants possibly competing with salons
• Figure 33: Profile of colourant users, by colour used, by lifestage,presence of children and Mintel's Special Groups, November 2003
• Opportunities for selling men's colourants to women?
• Figure 34: Profile of colourant users, by colour used, by maritalstatus, working status and household size, November 2003
• Distributors in East Anglia/Midlands should keep a good supply
• Figure 35: Profile of colourant users, by colour used, by region andACORN categories, November 2003
• Internet vs TV advertising
• Figure 36: Profile of colourant users, by colour used, by media usage,TV viewing and supermarket usage, November 2003

The Future

• Growth in over-35s set to increase
• Threat from hair salons
• New technology continues to push back frontiers in hair colourants
• Media educate the consumer
• Designer brands will gain importance
• Men turn to hair colourants

Forecast

• Trading up evident over next five years
• Figure 37: Forecast of the market for hair colourants and perms, 2003-07
• Keeping an eye on fashion
• Stimulating interest through media
• Factors incorporated