The U.S. ethnic cosmetics market has had its share of fits and starts. Now the engines are revving up again.
A decade ago, major corporate players including Revlon, Maybelline and Almay were marketing dedicated lines for women of color with names like ColorStyle, Shades of You and Darker Tones, respectively. However, the efforts lost momentum and strategies shifted to expanding shade ranges of core lines to provide selections for a spectrum of women.
Now the winds of change are blowing again.
In the last two years, Procter & Gamble has aggressively entered the ethnic market. First it invested in the Iman Cosmetics brand, created by international fashion model Iman. Last year it introduced the CoverGirl Queen Collection, a flanker brand for black women named for singer/actress and CoverGirl spokesmodel Queen Latifah. At the same time, L'Oreal unveiled H.I.P, short for High Intensity Pigment, a brand offering a wide face makeup shade range and brighter, bolder lip and eye colors.
Meanwhile, longstanding niche companies such as Black Opal, Black Radiance and Posner, along with the five-year-old Milani brand, show no signs of backing away from this market.
Black Radiance, a division of Markwins, is kicking off a summer promotional campaign that will tie in with local concert events in Detroit, Chicago, Philadelphia, New York, Miami, Atlanta, Los Angeles and Washington, D.C. There will be makeovers and product giveaways, according to a brand spokeswoman. Last year, Milani launched its first national advertising campaign and hired a public relations firm to garner more publicity. Add to that, the chief executive officer of Posner said it has just introduced a new display in Walgreen stores and next year the brand will expand into two new product categories.
The activity is no surprise, for the numbers are enticing.
Together, Hispanics, African-Americans and Asian-Americans accounted for 88 million people in 2006, according to U.S. Census data. That included: 39.3 million Hispanics, 36 million African-Americans and 12.9 million Asian-Americans. Together, these segments are expected to grow 8.6 percent to 95.6 million by 2010, representing about one-third of the total U.S. population. Indeed, those in the U.S. population who are classified as "minority" have just now breached the 100 million mark.
In a recent study on the ethnic HBC market in the U.S., market research firm Packaged Facts urged mass retailers to "wake up" to the potential of sales in this segment. The study estimated ethnic HBC retail sales at $1.9 billion in 2006, up 6 percent over the previous year and projected that number would climb to $2.5 billion by 2012. That figure includes hair care, skin care and cosmetics. Within that, cosmetics are expected to deliver a bulk of that growth - skyrocketing from $621 million in 2006 to $1 billion in 2012, according to the study.
Apparently everyone is looking to get a piece of the action.
Discussion Questions: Has ethnic or multicultural marketing becoming so important that retailers and suppliers are now being forced to address it? What are the potential costs of not engaging in ethnic marketing?