What does the future hold for premium beauty?

As a close follower of market trends, I often get asked my thoughts on what products I think will make the biggest splash in the coming year. Like any forecaster, I sometimes get it right, sometimes wrong. Let’s take a look at three trends I was predicting at the start of 2011 and see what really happened.

Prediction 1

The key issue in 2011 will be a deepening “income recession” as the cost of living rises far more quickly than wages. However, the premium beauty markets have shown enormous resilience and this is likely to continue in 2011.

What really happened

“Retail spending, especially at the luxury end of the business, has proven to be quite resilient.” Per Neuman, managing director, Estee Lauder Companies, quoted in Esprit, October 2011.

Prediction 2

Premium make-up was the weakest performer out of all the sectors in 2010 and perhaps the one most likely to lose out to mass/masstige brands. Education in the form of make-overs and master classes should become a key tool in attracting and holding onto customers. Self service brands cannot offer this level of education which could help women who lack confidence in using and applying make-up.

What really happened

Where self-service brands are scoring heavily is in providing how-to videos on their websites and on You Tube, explaining how to interpret the latest trends. Premium still wins hands down when it comes to personal advice, make-overs and classes at the counter.

Prediction 3

Pop-up shops are increasing in popularity with brands wanting to gain instant awareness with consumers over a short time period. Expect many more “guerilla tactics” such as this in 2011.

What really happened

Too many examples to list here, but this is a real trend that beauty companies are using to gain visibility and retail space. Online retailer, Cult Beauty, used the pop-up concept in Selfridges and showcased the latest underground niche beauty brands. Boxpark opened in Shoreditch in November 2011 and is the world’s first pop-up shopping mall.

And 2012?

Well, economic uncertainty is here to stay and the chances of another recession look increasingly likely. I’m hoping to get a better idea of how the premium beauty markets will fare after this next round of post-Christmas interviews. I’ll keep you posted.