The beauty of own-label brands

Sales of retailer own-label products are likely to experience a sharp rise in the health and beauty market as cash-strapped consumers decide that premium brands are now an unaffordable luxury

The personal care market has often put on a good face in innovation terms, launching many new brands in recent years. The desire among people to look younger, better groomed and more attractive has made this a very valuable sector.

But with consumers concerned about the global economic situation and reconsidering which items are necessities and which are frivolities, what will brands in this sector have to do to prove their worth? It is, however, worth considering what people consider to be “brands” in the personal care sector. Traditionally, we think of brands as being the fare that appears in a high-end magazine such as Vogue. But these days, people may also consider retailer own-label products as affordable options and brands in their own right.

According to data from YouGov’s Recession Tracker – which took data from more than 2,000 consumers in February 2009 – more than four in ten people are increasingly switching to retailer brands, which indicates that the issue of price is at the forefront of consumers’ minds.

In the past, the quality of retailer own-label products may have been considered not as good as more upmarket brands such as L’Or顬 and Olay, which were perhaps perceived as more advanced.

Indeed, premium brands have managed to get people to emotionally bond with them and trust them, which is why consumers have remained loyal over time.

But the winds of change are now blowing hard. Many consumers say they are now considering buying food retailer brands, and this number is even higher for those considering purchasing health and beauty retailer brands.

A tightening of budgets means that the risks of purchasing a brand that does not perform are further from consumers’ concerns. Reasons for buying more retailer health and beauty brands in the past six months include the fact that almost a third of us are willing to take a risk that the quality is better now.

Whether the quality of retailer brands is better than it was previously is debatable, but consumers are now more willing to convince themselves of this. Price is so much more important for them that the so-called risks involved in trying these brands are justified.

Strengthening this argument is the fact that across a set of core health and beauty categories, 49% of the population believes that price is more important now than before and they are willing to try cheaper health and beauty brands.

It is notable that the older generations are most likely to be taking these risks. Since these are also likely to be the people with most cash to spend in the current climate, this must be especially worrying for premium brands.

So, will consumers spend 2009 decluttering their beauty cabinets altogether or simply buying the more affordable retailer brands? Will consumers’ insatiable requirement to keep ourselves well-spruced be possible on a smaller budget? It’s time for the beauty battle to commence.

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