Premium beauty in Australia driven by gift-giving

By Lucy Whitehouse contact

- Last updated on GMT

Premium beauty in Australia driven by gift-giving

Related tags: Estée lauder companies

The premium category in Australia owes its recent sales growth largely to gift-giving consumers, Euromonitor International says.

The sector is on the rise, predicted to grow at a steady 2% CAGR up to 2018, and the market research firm notes that it owes this to the popularity of cosmetics kits and sets within the segment.

The sector is showing strong potential, but the individual consumer is not buying for personal use: seasonal buying has driven the sector’s growth to date, with consumers purchasing premium items in beauty sets to give as gifts. 

Passing it on

The research firm notes that sets are rarely bought by the individual consumer who ultimately uses them, suggesting there is room for the premium segment to grow further by enticing consumers to also buy for personal use.

In the premium segment, consumers typically will not purchase sets/kits for personal use, as they often include products which are not required. However, they become good value when bundled into sets/kits and presented as a gift,​” the analysts note.

Consumers currently lack interest because gift sets do not allow for choice in the product selection, states the firm, and some brands are now moving to tackle this pitfall.

The Body Shop, for example, is recognised as a brand which offers great gifts from its gift set range, and also allows customers to customise gift sets​,” state Euromonitor analysts.

Estee Lauder leading the pack

Estee Lauder has been highlighted as the category leader for beauty kits, with an 11% value share, thanks to its three key consumer-favourite brands: Estee Lauder, Clinique and Mac.

It regularly retails well-designed and attractively-packaged sets/kits at good value,” ​analysts noted of the brand. “These sets/kits are usually themed to deliver certain benefits​.”

Kits that offer specific benefits can appeal to those consumers who are looking to discover brands for the first time; for example, Estee Lauder’s special edition anti-wrinkle was well received by consumer looking for a trial or introductory pack.

Seasonal shopping is driving sales in the category, the firm’s analysts emphasize.

“The Clinique brand established a variety of offerings for the Christmas period based on specific needs such as High Impact Lashes, De-puff & Define Eyes and Happy & Smooth​,” they concluded. 

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