Overview of the Malaysian Oil Palm Industry

Datuk Dr. Yusof Basiron, General Director of the Malaysian Palm Oil Board reports..

"The Malaysian oil palm industry in 2003 flourished under the tight world oils and fats supply situation. The higher growth of world demand over that of production has resulted in an increase in export demand and prices for all Malaysian oil palm products.

The production of crude palm oil (CPO) in 2003 increased markedly by 12.1% or 1.4 million tonnes to 13.35 million tonnes from 11.91 million tonnes in 2002. The production of crude palm kernel oil also rose substantially by 11.6% to 1.64 million tonnes from 1.47 million tonnes the previous year. The increase was mainly attributed to the expansion in matured planted area, favourable weather conditions and rainfall distribution as well as constant sunshine throughout the year. The pollination and formation of oil palm fruits were excellent. Thus, the fresh fruit bunches yield per hectare increased by 5.7% to 18.99 tonnes from 17.97 tonnes last year. However, the oil extraction rate (OER) fell to 19.75% in 2003 from 19.91% last year.

The total export of oil palm products, constituting palm oil, palm kernel oil, palm kernel cake, oleochemicals and finished products increased substantially by 14.2% or 2.09 million tonnes to 16.78 million tonnes in 2003 from 14.69 million tonnes in 2002. The increase in total export value was much more impressive, soaring by 33.1% or RM6.50 billion to RM26.15 billion compared to RM19.64 billion in 2002. The favourable growth in exports was due to the tight world oils and fats supplies, higher growth in export demand and depleting world stock levels which resulted in higher prices of oils and fats including oil palm products.

Exports of palm oil increased by 12.5% or 1.36 million tonnes to 12.25 million tonnes from 10.89 tonnes in 2002. China P.R not only remained as the biggest market but also achieved the highest market growth with exports accelerating by 38.4% or 0.71 million tonnes to 2.55 million tonnes (20.8% of total palm oil exports) from 1.84 million tonnes in 2002. The European Union came in second accounting for 1.69 million tonnes (13.2% growth and 13.8% share). India was third with 1.59 million tonnes (but 5.0% reduction in growth and 13.0% share) followed by Pakistan with 1.10 million tonnes (1.3% growth and 9.0% share).

The second major product exported in 2003 (in terms of value) was oleochemicals which increased by 22.4% or 0.28 million tonnes to 1.55 million tonnes from 1.27 million tonnes in 2002. The major oleochemicals exported were Fatty Acids (0.71 million tonnes or 45.5% of oleochemicals exports), Fatty Alcohol (0.28 million tonnes or 18.2%), Methylester (0.19 million tonnes or 12.4%), Glycerine (0.18 million tonnes or 11.9%) and Soap Noodles (0.18 million tonnes).

The major market for oleochemicals were the European Union (0.50 million tonnes or 38% share and up by 21.7%), China PR (0.21 million tonnes or 13.4% and up by 34.7%), USA (0.19 million tonnes or 12.6% but down by 5.1%) and Japan (0.16 million tonnes or 10.6% and up by 15.3%).

The end of the year stock level of palm oil was 2.5% higher at 1.17 million tonnes compared to 1.14 million tonnes last year. The higher end December stock was due to the unprecedented surge in the month’s production, while export remained lower as normal during this month.

The average prices of oil palm products strengthened in 2003 driven mainly by robust export demand, draw down in stock levels, sharp rise in soyabean oil prices and continued tightness in global oils and fats supplies. The average CPO price increased by 13.2% or RM180 to RM1,544 as against RM1,363 the previous year. The lowest and highest monthly average price were recorded in August and November at RM1,398 and RM1,866 respectively. The highest daily price was RM1,950 in late October while the lowest was RM1,372 in mid-August. Subsequently the average export price for RBD palm oil rose by RM259 or 19.2% to RM1,613; RBD palm olein up by RM247 or 17.1% to RM1,695; and RBD palm stearin increased by RM124 or 9.8% to RM1,399. For plantation companies and smallholders, 2003 had been a remunerative year as the average price of FFB at 1% OER increased by 18.4% or RM2.43 to RM15.62/tonne from RM13.19/tonne the previous year.

The world oilseed and seed oil production in 2004 are expected to respond pronouncedly to the high price situation in 2003. However for palm oil, due to its cyclical nature, the production growth in 2004 is expected to be smaller. Coupled with a sharp reduction in world oils and fats ending stocks last year, the supply situation in 2004 is anticipated to remain tight.

Based on this background, the Malaysian oil palm industry in 2004 is forecast to remain bullish. The production of CPO is projected to increase by 2.3% to 13.66 million tonnes and prices are expected to remain firm this year."

Vitamins in Skincare Products on Rise

NEW YORK--According to research presented at the American Academy of Dermatology in March, the number of skincare products containing vitamins has increased three-fold in the past nine years. Popular vitamin add-ons include vitamins A, B, C and E. Vitamin A works to battle free radicals, vitamin B keeps skin hydrated, vitamin C works as an antioxidant and potential sunscreen and vitamin E shields against UVB rays.

However, most experts agree that living a healthy lifestyle--eating a balanced diet, getting adequate sleep, exercising and using sunscreen--will benefit skin the most. For more information, visit www.aad.org.

Natural Products Insider. "Personal Care News." . . . 26 03.2004

Soap Manufacturers Likely to Close Down Business

By Deodatus Mfugale

Soap industry in Tanzania dates back to just about three decades ago when individuals produced a few bars of soap using mainly low and crude technology.

Coconut oil as the major raw material for most small scale producers has for a considerable time been supplied by Zanzibar.

There were a few suppliers from Kilwa, Lindi, Dar es Salaam and Pangani. Historically, soap production in Tanzania has focused mainly on bar laundry soap. This can be explained by the fact that it was then affordable by low income earners and even by those who had no guarantee of a regular income.

Even today, many ordinary families acknowledge the dual use of a bar of soap for laundry as well as for washing themselves. To many ordinary Tanzanians, toilet soap is a luxury.

So the soap manufacturing industry grew through the decades from a small enterprise, usually owned by a family to a medium size unit producing not a score of bars but tons of soap.

Some producers have also diversified their line of production to include toilet soap, detergent, cleaning products and edible oil.

Thus from a handful of producers in the late 1970s, there are 18 companies today producing a total of 300,000 metric tons of soap annually and employing about 3,000 Tanzanians.

The soap industry in the country now covers seven regions with the number of factories in brackets: Dar es Salaam (10), Zanzibar (2), Tanga (2) and Morogoro (7). Others are Arusha, Mbeya and Mwanza regions each of which has one factory.

Companies which make up the soap industry in Tanzania are IPP/Bodycare Ltd, Tip Soap Industries, G & B Soap Industries, Boby Soap, Soap & Allied Industries and Lackhani Soap Industries.

Others are Abood Soap Industries, Bidco Tanzania Limited, Highland Soap, Lake Soap Industries, Tradeco Soap Ltd and Showerlux Industries Ltd.

Also in the list are Chemi & Cotex Industries (DSM), Chemi & Cotex Industries (Arusha), Murzah Oil, Sabuni Detergents, Bakhresa Soap and Changu Soap.

The 18 factories in their totality use only 30 percent of their installed capacity. This means there is still capacity to produce more, given the availability of raw materials at a reasonable price and the market demand. Yet regardless of their installed capacity the Tanzania Soap Industry is no more than a medium enterprise.

Raw materials for soap and edible oil factories

Soap producers require Refined, Bleached and Deodorized (RBD) Palm Stearin as a raw material. Crude palm oil is merely a compound from which they derive the raw material required.

The soap industry in the country needs 50,000 of RBD Palm Stearin. Of all the 18 companies, 13 are stand-alone soap manufacturers and must import RBD Palm Stearin for making soap.

They don’t import crude palm oil for the purpose.
Although RBD Palm stearin can be derived from palm oil through fractionation, the process requires heavy specialised technology of splitting fat.

Only two soap manufacturers who are also engaged in the production of edible oil have installed and commissioned such the plants in the country.

Besides the prohibitive cost of the plants, the whole process of palm oil production, refining and processing of palm oil products also requires heavy investment in palm plantations which may take up it four years before bearing fruits.

Again crushing plants must be located within plantations as the fruits must be processed within 24 hours, otherwise they become spoilt.

Experts in the palm oil industry say that economic refining and fractionation plants require an average of between 300 and 400 tons per day.

Due to these technical reasons, the Tanzania soap industry does not have the capital required for the heavy investments and will therefore continue to depend on imported RDB palm stearin for a long time in future.
Rising costs have made production of soap uneconomical

Currently, soap manufacturers in the country are producing at a loss as the cost of production has gone up. A standard 1x10 regular box (10 bars of soap) including packaging, costs 3,897/82 while the same is sold at 3,333/33. The producer thus suffers a net loss of 564.49 per box of 10 bars of soap.

Besides other factors, the price of RBD palm stearin has gone up from 320 USD to 485 USD per ton since September last year. This situation, coupled with the existing stiff competition, threatens to eliminate some soap producers from the industry. More>>

Mfugale, Deodatus . "soap manufacturers likely to close down business." Guardian 29 03. 2004. 29 03.2004

Market Research Report; Cosmetic & Toiletry Chemicals

US demand to approach $7 billion in 2008

US demand for cosmetic and toiletry chemicals is projected to near $7 billion by 2008. Gains will be driven by factors such as the use of active ingredients designed to both enhance appearance and to counter the effects of aging. Growth will also reflect a greater demand for plantderived ingredients and specialty additives offering protection from sun, heat, wind, pollution, smoke and other threats to healthy skin and hair.

Demand in volume terms is projected to record more modest gains through 2008. Advances will be restrained to some extent by the growing popularity of water-based and non-aerosol formulations in skin and hair care products and the use of higher value ingredients that are more effective at lower loadings.

The incorporation of active ingredients -- such as plant acids and enzymes -- into toiletries and cosmetics, as well as their focus in marketing efforts, has become one of the most compelling factors driving growth in the otherwise mature US market. Growth in demand for active ingredients is projected to approach double digits, propelled by strong demand in so-called cosmeceutical skin care products and high value additives such as nanoscale ingredients.

The emergence of products created as a result of nanotechnology is expected to have a substantial effect on the industry. Among the first such products to establish a market presence are polymers used as delivery systems for vitamins and other actives, and inorganic pigments used in sunscreens.

Plant-derived, other natural ingredients find favor with producers and consumers

Organic ingredients are expected to remain an important component of the cosmetic and toiletry chemical market, both in product formulation and reformulation, and in terms of marketing impetus that is so critical to manufacturers looking to retain or expand their respective shares of the market. The fastest growth, approaching or exceeding double-digits annually, is expected for small-volume herbal extracts that have established themselves as safe and effective ingredients in nutraceutical products. However, the high cost of many botanical extracts and issues of quality control and standardization will restrain further gains.

Biotechnology may hold the key to increasing the availability and improving the consistency and quality of plant source materials. However, labeling policies regarding genetically modified materials may affect product preferences, as consumers have generally expressed wariness about such materials.

Ingredient makers seek growth in cosmetics and toiletries market

A key to gaining or retaining market share in the cosmetic and toiletry chemical market is supplying materials used in finished products that compete in growing or traditionally underserved market niches. Among such areas are the ethnic hair and skin care markets, as nonwhite populations are expected to register faster growth through the next decade. Also, the teen segment has above average growth potential, as incomes of teenagers are rising more rapidly than for the population as a whole. More >>

Study coverage
Cosmetic & Toiletry Chemicals, a new Freedonia study, presents historical data plus forecasts to 2008 and 2013 in current US dollars by product, function and market segment. This study also details key regulatory issues, analyzes market share data, and profiles more than 30 industry participants.

The Freedonia Group. "Cosmetic & Toiletry Chemicals." . 02.2004. Global Information, Inc.. 26 03.2004 .

Sampling; a Prime Way to Add Value to Your Brand

Sampling Success
Larry Burns

“Free samples!” Two words that will make hearts leap and palms sweat. The thought of giving away samples may send you into a tizzy, but the response from consumers will make it well worth your while. The tactic of offering a consumer the chance to experience and try a product before buying it has been a foundation of marketing practice for decades, quite simply because it works.

Consumers are overwhelmingly positive and appreciate the ability to try products before they buy them, reported the recent survey "Trial and Conversion VI," which was conducted for the Promotion Marketing Association by NFO WorldGroup, a leading provider of research-based marketing information.

In the United States, product sampling industry revenues have been estimated at 1.2 billion annually, excluding the cost of the products themselves. In 2001, product sampling was one of the few marketing tactics that actually grew while the overall promotions industry revenues suffered their first decline in ten years.(1)

Basic consumer truths help shed light on why, as marketers, you ought to be seeking to understand how and when sampling might work best within a brand’s marketing mix. Fully 94 percent of U.S. consumers responded with agreement that sampling is a risk-free way to try new products, and 68 percent reported that they were truly “excited” about trying a sample they had received.(2)

Think about that for another moment. More than two-thirds of consumers were excited about a “branded moment” they were given the opportunity to experience, by virtue of having gained access to a product sample. Isn’t getting a consumer excited about your products one of the true marketing challenges you face?

Now, will sampling really add to your business results? Should you be developing a sampling program for your brand? The answer is a resounding, absolute and unequivocal maybe. The techniques of sampling are effective, but sampling is not right for every brand and certainly not at all times within a product’s lifecycle. You must verify there is justifiable evidence that a majority of your target market consumers will respond in a positive manner to the product being sampled. To know whether sampling is right for any one brand, and when, start at the foundation of your brand strategy.

OBJECTIVES. What are the objectives of your marketing strategy for the brand? This fundamental question is the most integral part of the process. While sampling is often first thought of as a trial vehicle for new products, there are many stages in a product’s lifecycle that may directly benefit from a sampling approach. For example, reviving an older brand, a new line extension or a product reformulation could bring back lapsed users or overcome a competitor’s branding efforts.

TARGET AUDIENCE. Who is the target audience you seek to reach? Multiple consumer segments exist with variable potential value to your objectives. Consider the discrete "sub-groups" within your target that might offer more potential to your brand. Often these segments can and should be treated differently within your program structure to ensure maximum ROI.

CONSUMER EXPERIENCE. Are you clear on what consumers need in terms of a product experience to ensure they can properly evaluate a product? Ensure enough applications are available in the sample to allow consumers to determine whether a product works. Packaging also shouldn’t become an issue. If consumers struggle to open a packette, the entire sampling experience is compromised.

MARKETING MATERIALS. What additional marketing materials and information will enhance the overall consumer experience and should be included with the sample? Sampling provides a unique moment with consumers where they stop and attend to your product. Evidence suggests these materials add value, and 73 percent of consumers report they always or sometimes look at information that "comes with" their samples.(2)

Measuring Impact
The ultimate goal of any sampling effort is not to sample but rather to convert consumers into more frequent brand buyers. Yet, you must establish clear and formal goals and agree on how you would like to measure success before you execute any program.

1. Decide on the metrics. This includes actual purchases (measured in some manner consistent with available market data), consumer perceptions (marketing research driven pre/post or test/control designs), coupon redemption (uniquely coded purchase incentives linked back to the program), opt-ins to a club or program (an increasingly popular enterprise in the online world).

2. Design data collection methods.

3. Set benchmarks that equal "success," such as a percentage of new buyers entering the franchise as measured by data stream Y over a specific amount of time and the months following its market execution.

4. Agree up-front across the brand supplier and management to the metrics and measurement proposed.

5. Follow through in analyzing the program at the proper time following completion.

Cost
Assess the value of any sampling program to determine whether the overall cost per converted consumer justifies the scope of the program in regards to your goals. Cost should include all product packaging and labor required to create and have the samples available for use. In many instances your sampling supplier can consult on packaging and the utility of the sample from a consumer and delivery standpoint. For early analysis, simply use a rational value to represent the program cost of engaging consumers and distributing samples to them. These final costs will vary by tactic chosen. At first, base cost on brand history or internal benchmarks and model from there. In addition, factor coupon redemption and other purchase incentive costs into your ROI assumptions.

However, avoid being caught in the "this looks too expensive" trap by failing to look beyond the cost-per-thousand metrics on distribution of the samples—regardless of the program type chosen. To really understand the cost/benefit equation and reach a considered opinion on the value of sampling for your brand, you must look at the value of consumers who experience your program beyond their trial purchase.

In personal care, with a consumer behavior that seeks variety and with new colors, scents and fashion changing by season, it is essential to consider the fact that a consumer being brought into the brand’s overall franchise might "pay out" well beyond the individual item being sampled.

As one assesses the long-term value of brands’ sampling efforts, a good sampling program has both tactical—immediate trial—and strategic benefits, such as building long-term brand franchise and equity. Force yourself to attempt to quantify some sense of the annual or even lifetime value of a consumer gained for your company versus one more sale for the individual brand, and you might be surprised by the value sampling can help you create. Consumers responding to the question, "What do you usually do with your samples of cosmetics?" reported that 34.3 percent "used it right away," 41.3 percent "saved it for later use" and 17.8 percent "gave it to someone else" with only 6.7 percent reporting that they "threw it away."2 Compared to other categories studied, cosmetics exhibited, by far, the highest "gave it to someone else" behavior. Could this knowledge be used to enhance consumers’ experiences by determining whether they might be an appropriate person to be given additional samples to pass along to friends, spreading the influence of the program? Some of the newest marketing science research indicates attempting to foster positive word of mouth can directly add to brand success.

Once established, marry your program goals, consumer understanding and needs along with the financial discipline of seeking to maintain the lowest possible cost per converted consumer and develop an effective sampling program.

Sampling Options
Dependent on your brand goals and product attributes, some sampling approaches may be self-evident; in other cases, you may still have a wide-open field to explore. Brand owners traditionally have sought to reach their sampling goals by utilizing one of the varying forms of in-store sampling, sampling via newspapers, direct mail sampling, in-magazine sampling, street corner sampling and event sampling techniques. This year, the plethora of options is even more expansive and creative, including more events than ever to draw consumers to a particular location for samples; point-of-use sampling, which places items where consumers really have the need for the product, such as a body wash sample at the health club; and online programs that put the consumer in control of their interaction with the brand and move sampling to an "active request" mode. Samples are often part of the overall experiential marketing taking place and, frankly, the possibilities are not likely to slow down.

One phenomenon that is gaining favor is the hybrid program approach in which sampling is accomplished across a variety of different approaches and tactics all under the same brand program. Consumer touch-points need to cast an ever-wider net as consumers continue to become a more elusive breed for the marketer to engage. By spreading your sampling program across multiple venues and tactics, you may increase the opportunity for any individual consumer to be impacted.

How brand owners can engage consumers with samples is limited only by your imagination and the ability to find a supplier who can share and even enhance their vision and, therefore, effectively execute the program. Aim high and do not be afraid to stretch your partners to explore new possibilities. Consumers are leading increasingly complex lives and are ever more difficult to reach, and your programs must break new ground to keep up with them.

References
1. April 2002, annual report of the U.S. promotion Industry, PROMO magazine estimate
2. Trial and Conversion VI, March 2002

Larry Burns is president and CEO of StartSampling Inc., an online marketing and promotion company, and chair of the Promotional Marketing Association’s Sampling Council. www.startsampling.com

Larry. "Burns." Packaging. 30 12. 2003. The Cosmetic Site. 23 03. 2004

2004 Color Trends; Back to Basics

Back to Basics
Martha Graziano

The direction of color trends for 2004 lends itself to a bountiful range of comforting earth tones, a palette of blues from metallic to powdery to starlight shimmer, soft greens, an array of rich reds and innocent pinks in mid-tone hues and silvers tinted with violet, blue or red. The earth tones include an amazing multitude of different shades of the gold, copper, tan, bronze, red flamed copper and muted browns—evocative of a sun-drenched desert canyon.

“Earth tones complement the spa colors of blues and greens that are so prevalent in fashion,” said Melanie Wood, past president of the Color Marketing Group and color consultant. Earth-toned colors, enhanced by luminescence, give a chameleon effect as they take on a glow of the colors around them and complement the entire fashion ensemble. These tones seem to “come alive,” giving an aura of freshness and energy.

“The copper range will be expanded through 2005 and could not be more important,” added Sunny Maffeo, creative director, color and design marketing for Engelhard. In 2004, the range will include a sun-kissed golden copper with a glistening sheen, and the emerging family of copper with a pink cast, which can appear warm and glowing on the face. The coppers are being combined with pastel tones, part of a trend taking a juxtaposed position to the extreme, according to Maffeo. Copper will be part of a family of tone-on-tone, gem-like flashes inspired by unbaked terracotta, and warm tile tones. Powdery surfaces contrast with ultra glossy and iridescent or varnished reflections. The coppers and bronze-golds can add a sun-kissed or glistening look for face body or hair, Maffeo noted. These shades give luminosity and copper tones beyond a tanned appearance, giving a moist golden glow.

Special Effects
Effect pigments can enhance the looks of any personal care formulation in a full range from a subtle shimmer to a bold statement. Cosmetic chemists and marketers can produce a unique color play and new looks in formulations with these earth tone special effect pigments. The earth tones are going into new areas such as skin lotions, body washes and other personal care products beyond color cosmetics, as evidenced by products such as Nivea Silky Shimmer lotion or Jergen’s Soft Shimmer lotion.

As natural earth tone shades continue their strong popularity, Eckart recently launched four new earth tone metallic colors—Olive Gold, Maize Gold, Amber and Lava in the Visionaire® cosmetic metallic pigment line. This line covers the full range of effect pigments from majestic gold and copper shades to elegant silver to produce rich metallic hues—strikingly appealing in cosmetics. Metallic pigments, when mixed with other colorants such as organics, pearlescents or other special effect pigments, can create unique polychromatic effects and create new colors. Based on innovative silica encapsulation technology, the Visionaire pigments offer unique metallic luster combined with formulation flexibility, including improved stability in water-based formulations. The Visionaire copper, bronze and aluminum pigments have global approval for all applications within cosmetics, with the exception that aluminum is not approved for lip products in the United States.

Formulators have a wide choice in earth tone special effect pigments in gold, bronze, copper and red flamed copper pearlescent pigments. These earth tone pearlescent colors can be found particularly with the Prestige® line from Eckart, the Cloisonné™ and Desert Reflections™ lines from Engelhard, the SunShine line from Sun Chemical and the Colorona® and Timica® line from Rona. The Reflecks™ Colors from Engelhard are based on an innovative borosilicate substrate, providing exceptionally transparent and clean earth tone shades. All these rich-looking pearlescent pigments are available in a variety of particle sizes to provide silky to glittery color, with a concurrent range of coverage and translucency. Color travel special effect pigments, based on multi-layer technology, are available in earth tone ranges from BASF Sicopearls® Fantastico Gold Copper. There are earth tone shades in this technology that shift colors depending on the viewing angle. Rona, the Cosmetic Business Unit of EMD Chemicals Inc., also produces color travel pigments in its Xirona line.

Color Play
Although the cosmetic color additive regulations constrain the industry, cosmetic chemists and marketers can produce an endless color play of formulations with these earth tone special effect pigments for accents or overall new shades. Unique textures and depth of color can often be achieved by mixing two different shades in special effect pigments, especially of different particle sizes. By combining special effect pigments of different technologies with conventional organic pigments, the possibility for much more exciting and new colors, textures and looks arise.

Martha Graziano is the business development manager, Personal Care, for Eckart America.

Martha. "Graziano." Formulating. 30 12. 2003. The cosmetic Site. 23 03. 2004

Marketing to Men; a True Market Niche

Marketing to Men
Sara Mason

Men are a true market niche. They are becoming more interested in skin and body care, yet there still is a lot of room for building awareness. “They are interested but not necessarily embracing it yet,” said Lisa Hawkins, executive director of marketing for Aramis, Estée Lauder’s prestige men’s grooming, skin care and fragrance products. In the past, it has been the woman’s job to shop for men. "But that’s changing rapidly as men come to terms with having to look their best to stay in the hunt, professionally and personally,” explained Michelle Probst, founder of the men’s skin care line Mënaji. The market is not only being validated, it is booming.

“Men are spending 51 minutes a day grooming and spending $12 billion to look better—from whitening toothpaste to cosmetic surgery,” said Probst, a makeup artist turned entrepreneur. She explained that men are the fastest growing segment of the cosmetic industry, and now, more then ever, they are purchasing their own personal care items.

The media have been responsible for building that niche. Personal care isn’t something men talk about with their buddies. Education has come from men’s magazines, which are addressing personal care concerns more each year. “It isn’t taboo anymore,” Probst said.

The Web also plays a primary role, according to James Whittall, president and owner of MenEssentials.com. It lends itself to confidentiality and is a source for background information on a product or specific need before making purchasing decisions. The major demographic for Web use is males ages 25–45, the main purchasers of online products. “We married the medium with a key demographic to provide answers to legitimate grooming concerns,” said Whittall. He aims to make information accessible to men, assuming that they are intelligent individuals who only lack knowledge in the area of grooming. “The Web can provide the answers to sensitive questions not being tackled by most resources,” he explained. “We add a touch of irony, self-deprecation and humor to address these issues in an entertaining way. It is unorthodox, and it works.”

While men are not as sophisticated as women in the area of personal care, educating them through the media will help men become more aware of their options and be more comfortable with making changes in their purchases. Full Article >>

Sara. "Mason." Business. 03. 2002. The Cosmetic Site. 23 03. 2004

Metrosexual Revolution

The Motley Fool reports, "Howard Dean might not have invented the word (heck, he subsequently admitted he didn't even know what it meant), but the metrosexual industry sure got a boost when the primal screamer called himself one last October. Metrosexual industry? You mean there's a whole industry? Well, yes. And it's booming.

First coined in 1994 by a British journalist, metrosexuals are allegedly urban, heterosexual men who have the incurable urge to wax, exfoliate, and otherwise pamper their vanity. Or, as the global marketing and advertising agency Euro RSGC termed it: It's a man with "internally referenced masculinity." Uh huh. And now it's front and center on the popular television makeover show Queer Eye for the Straight Guy.

According to market researchers Mintel Group, mextrosexuals are a worldwide $8 billion-a-year industry, with the U.S. accounting for more than $2.4 billion. Department stores alone sold $86 million worth of male grooming products in the first nine months of 2003, notes NPD Group, and market research firm Kline & Co. says such sales nearly tripled in the last 10 years. Helping men find their feminine side is reaching far into the apparel, cosmetics, self-improvement, and personal-care segments." Full Article >>

Plastics’ New Purpose in Packaging Has Given Rise to New Formats and Options in Personal Care

From Substitute to Superstar
William Makely

The primary objective of cosmetic packaging—like poetry—is to astonish and delight. Carrying a product safely and securely to the marketplace is not the issue. Catching the eye, attracting the touch, inviting a sampling, projecting the user’s image—these are the higher goals. Packaging for personal care products has, in recent years, increasingly stressed convenience as its added value. You can see it in the explosion of dispensing closures, inverted bottles and tubes and squeeze bottles hitting the industry.

Consumers expect to see plastics serving the latter purpose, in plastic and plastic laminate tubes, shampoo bottles, and the like. Squeezable bottles became a necessity with the rise of the ultimate convenience feature, the dispensing closure. Bottles in the bathroom have to squeeze. Rising safety concerns also dictate that they have to be unbreakable.

Plastics filled the gap.

Where do we not expect to see plastics? In upscale fragrance and lotion packaging, where glass has always reigned. High design, crystal clarity and sheer weight reinforce the value of the contents and of the special role they play in consumers’ lives. But here, too, use of plastics in packaging is growing, made possible by technological advances in plastics chemistry and fueled by a combination of consumer concerns and economic influences.

Perhaps the most surprising use of plastics in cosmetic and personal care packaging has been the migration of flexible packaging from the food arena, adding package drama by being unexpected—even unnecessary—yet surprisingly appropriate.

Not too many decades ago, "plastic" was a pejorative term, because plastics were used almost exclusively to replace more expensive materials and were associated with a cheapening of the original. Today’s plastics are still often used as a replacement, primarily for glass. But technological advances have in almost every case made them better than the original, rather than a poor substitute. Full Article >>

William. "Makely." Packaging. 04. 2003. The Cosmetic Site. 23 03. 2004

Spas; The Leading Outlet for Professional Skin Care Brands

Research from Kline's new study, THE U.S. PROFESSIONAL SKIN CARE MARKET 2003, reports that spas are the leading outlet for professional skin care brands, followed by medical offices, department store, and specialty stores. According to the report, spas have expanded the number of doors in the U.S. by more than 18% per year over the last five years.

Kline's study reports that the spa and salon channel accounts for nearly 65% of the total market for professional products, but that retail stores have actually taken about 8% of these sales from spas since 1998. “Marketers of spa products have largely ridden the wave of new spa openings rather than actively pursuing strategies to grow their brands,” says Contreras. “Considering that sales growth of their products has lagged behind growth of spa locations, there are definitely more possibilities for growth to exploit here.”

Bolstered by the booming spa business and a growing distribution in retail outlets, the U.S. market for professional skin care products has outperformed the market for standard retail skin care products to a significant degree. “The segment has been booming but still has plenty of room for growth,” said Kline’s Lenka Contreras says. “There are low barriers to entry, high consumer demand, and big potential for profit.”

This first-edition report builds on Kline’s annual report of the traditional retail market for cosmetics and toiletries in the United States. This new report covers consumable skin care products sold to professional channels for back-bar and take home use in the United States in 2003. The market is estimated at more than $0.5 billion at the manufacturer level, have grown nearly 10% per year over the last five years. The traditional market for facial treatments has expanded by just 5.4% during the same period.

Other significant insights include:

- Because of the popularity of spas, several cosmetic and toiletry retails chains are considering or testing out day spas near or next to their existing locations.

- Marketers -- large and small, and traditional and professional – are concerned about the threats that the new brands from dermatologists like Fredric Brandt and N.V. Perricone bring to the industry.

- Ironically, the physician-endorsed skin care products have not seen as brisk a business through dermatologists' offices or cosmetic surgery centers.

- Retail sales of men’s skin care products alone have nearly tripled in the last ten years and show no sign of slowing.

The Section on Spas includes an overview of the spa channel with information on number of outlets, historical sales growth, facilities and services provided, competitive landscape, dollar and unit sales of skin care products, customer profile, and outlook to 2008.

The 25 Profiled Brands included: Avance, Aveda, Cellex-C, DDF, Decleor, Dermalogica, Dr. Hauschka, Elemis, Epicuren Discovery, Jurlique, La-Roche-Posay/BioMedic (L’Oreal), MD Forte, MD Formulations, Murad, NV Perricone MD, Naturpathica, NeoStrata Exuviance, Obaji Medical Products, Peter Thomas Roth, Repechage, Skinceuticals, Sothys, Sundari, and Yon-Ka.

Established in 1959, Kline & Company (www.klinegroup.com) is a business consulting and market research firm serving clients worldwide in the cosmetics and toiletries, household cleaning products, and other consumer products sectors.

Spatrade. "." News. 03 02. 2004. SpaTrade. 23 03. 2004