THE BEAUTY OF CREATIVITY - nielsen.com · Source: Nielsen TV Brand Effect: Ads indexed against...
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James Russo SVP, Global Consumer Insights THE BEAUTY OF CREATIVITY MARCH 2015
Transcript of THE BEAUTY OF CREATIVITY - nielsen.com · Source: Nielsen TV Brand Effect: Ads indexed against...
James Russo SVP, Global Consumer Insights
THE BEAUTY OF CREATIVITY MARCH 2015
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@Nielsen
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MEET YOUR PRESENTER
James Russo SVP, Global Consumer Insights Nielsen
James Russo SVP, Global Consumer Insights
THE BEAUTY OF CREATIVITY MARCH 2015
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CHALLENGES
MEGA CATEGORY WITH MODERATE GROWTH
STANDING OUT IN A SEA OF SAMENESS
OPPORTUNITY TO SHINE ON SHELF
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MEGA CATEGORY WITH MODERATE GROWTH
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NEARLY $50 BILLION IN TOTAL U.S. BEAUTY SALES
Sources: Nielsen, NPD and select financial information
Department 17%
Food 8%
Drug 14%
Discount/Warehouse 3%
Other 6%
Internet 8%
Specialty 17%
Mid tier 1%
TV/Home Shopping 3%
Mass Merchandisers 25%
ESTIMATED AT $47.9 BILLION
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DRIVEN BY STRONG CONSUMER DEMAND
With an average spend of
$257 dollars annually
99% of HHs purchase beauty products
8 Source: Nielsen NPD Beauty Cross Channel Report, Homescan Total U.S. 2014 Beauty (Makeup, Hair Care, Skin Care, Fragrances)
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$22.1 Billion
+0.4%
UNIT SALES % CHG YAG
DOLLAR SALES % CHG YAG
-2.0%
$11.2 Billion
PRESTIGE/ DEPARTMENT
MASS MARKET FOOD DRUG
MASS MERCH DOLLAR
CLUB MILITARY
TOTAL CHANNEL
SCALE ACROSS MASS, GROWTH WITHIN PRESTIGE
Source: Nielsen NPD Beauty Cross Channel Report, 52 weeks ending 01/05/15, Total U.S. Beauty (Makeup, Hair Care, Skin Care, Fragrances)
+1.5% +3.4%
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$21.3 Billion
$22.0 Billion
$22.1 Billion
2012 2013 2014
+5.1%
SLOWING BEAUTY SALES WITHIN TOTAL MASS Mass Beauty Sales
Source: Nielsen/NPD BCCM, Total U.S., 52 weeks ending 01/05/15, Beauty (Makeup, Hair Care, Skin Care, Fragrances)
+0.4%
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SHOPPING BEAUTY LESS OFTEN…
Source: Nielsen Homescan, Total U.S. 2014 Beauty (Makeup, Hair Care, Skin Care, Fragrances)
(3.4) (3.6)
(6.7)
(0.1) (1.5)
1.7
(2.8)
0.9
(14.9)
(0.4)
0.5
(2.6)
Mass Market Mass Merch Drug Grocery Club Dollar2013 2014
Beauty Trips % Change versus previous year
MASS BEAUTY MARKET MASS MERCH DRUG WAREHOUSE
CLUB GROCERY DOLLAR
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45% 45% 47%
27% 26% 23%
18% 19% 20%
6% 6% 6% 3% 4% 4%
2012 2013 2014
Source: Nielsen Homescan Total U.S. 2014 Beauty (Makeup, Hair Care, Skin Care, Fragrances)
SPENDING INCREASES NOT OFFSETTING TREND
DOLLAR
WAREHOUSE / CLUB
GROCERY
DRUG
MASS MERCH
TOTAL U.S. MASS BEAUTY
$ % CHG vs. year ago
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STANDING OUT IN A SEA OF SAMENESS
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SPENDING MORE ON ADVERTISING
CPG Beauty
$28.0 B
$2.2 B 10% OF
SALES
4% OF SALES
Source: Nielsen AdViews, Total U.S. Beauty (Cosmetics, Skin Care, Hair Care, Fragrances) vs. All Other CPG Categories, All Media Types, 2013 – 2014
Advertising as a percentage of sales is higher within Beauty
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OPPORTUNITY TO INCREASE EFFECTIVENESS
Source: Nielsen AdViews, Total U.S. Beauty (Cosmetics, Skin Care, Hair Care, Fragrances) vs. All Other CPG Categories, All Media Types, 2013 – 2014
LOWER AD
QUALITY
20% less memorable on general recall for
women 18+ vs all other CPG
40% less memorable on brand linkage for women 18+ vs all other CPG
A LOT OF THE SAME
DRIVEN BY
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OPPORTUNITY TO SHINE ON SHELF
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INCREASED SKUS HAVE DRIVEN VELOCITIES DOWN Is more necessarily better?
Source: Nielsen Answers, Total U.S. 2013 vs. 2010 17
11%
-1%
BEAUTY CARE
Total Distribution Pts$ Velocity
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STANDING OUT AMONG 900 ITEMS How do you shine on shelf?
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CHALLENGES
OUTCOMES
INSIGHTS
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CONNECT TO THE LARGER CONSUMER TRENDS
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TREND 1: WELLNESS REQUIRED
WELLNESS REQUIRED
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+24%
NATURAL BEAUTY A GROWING FORCE Average USD value growth
Source: Nielsen Answers, Wellness Track, Total U.S., 4 Years through 52 weeks ending 11/22/14 CAGR = compound average growth rate
Total U.S. Beauty
(4-YR CAGR)
+2.7% +14%
Total U.S. Natural/Organic Products
All Categories (Latest 52 weeks)
Total U.S. Natural/Organic Beauty Products
(4-YR CAGR)
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TREND 2: HISPANIC SPENDING POWER
HISPANIC SPENDING POWER
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Across total Beauty Care, Hispanic Americans spend on average 34% more than expected based on their population. Demographic Comparisons:
Hispanic Americans 134 Asian Americans 127 African Americans 99
Caucasians 96
HISPANIC AMERICANS ARE LEADING BEAUTY CARE CONSUMERS
Source: Nielsen Homescan Total U.S., 2014 Beauty (Cosmetics, Skin Care, Hair Care, Fragrances)
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PREFERENCES AMONG MULTICULTURAL CONSUMERS Who’s shopping what types of Beauty Care?
Source: Nielsen Homescan Syndicated Panel Total U.S. 2014
White African-
American Asian Hispanic
(any race)
HAIR CARE
COSMETICS
SKIN CARE PREPARATIONS
FRAGRANCES – WOMEN
FRAGRANCES – MEN
SHAVING NEEDS
Index is: 120 or greater between 80–120 80 or less
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7.4
3.0 3.8
9.5 9.3 7.9
2.5
-1.2
-3.6 -2.9
1.9 4.0
0.5
-3.5
HispanicNon Hispanic
COSMETICS HAIR CARE ACCESORIES
PERSONAL CARE APPLIANCES
BAR AND LIQUID SOAP
HAND AND BODY LOTION
FACIAL CLEANSER & MOISTURIZER
SHAVING NEEDS
YOU CAN’T WIN WITHOUT HISPANICS
Source: Nielsen Target Track, Total U.S. Market, 52 weeks ending 10/04/14
$ % Change growth versus previous year
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TREND 3: MEN AND BEAUTY
MEN AND BEAUTY
Wellness required
Hispanic spending power
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10%
25%
32%
30%
28%
25%
9%
14% 22%
6%
WOMEN MEN
MAKEUP
FRAGRANCE
SKIN CARE
HAIR CARE
SHAVING NEEDS
Increase $ spend vs. previous year
TOTAL U.S.
MEN ARE BECOMING A FORCE IN BEAUTY
Source: Nielsen Homescan Total U.S., Q2 2013 - Q2 2014, Beauty (Makeup, Skin Care, Hair Care, Fragrance, plus Shaving Needs)
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WOMEN AND MEN, EXHIBITING SIMILAR RECALL ON BEAUTY
CATEGORIES
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WOMEN MEN General Recall
Brand Linkage
General Recall
Brand Linkage
MAKEUP 94 91 93 85
SKIN CARE 109 99 106 100
HAIR CARE 98 106 100 109
FRAGRANCE (Women) 105 132 106 124
FRAGRANCE (Men) 97 98 100 95
HIGHEST RECALL WITHIN FRAGRANCES
Source: Nielsen TV Brand Effect: Ads indexed against total top advertising beauty ads within collection of Hair Care, Cosmetics, Fragrances, Skin Care for Males & Females, F18+ & M18+ Q3 2013-Q2 2014
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FEMALE EMPOWERMENT RESONATES WITH FRAGRANCES
*Source: Nielsen TV Brand Effect: Ads indexed against total top advertising beauty ads within collection of Hair Care, Cosmetics, Fragrances, Skin Care for Millennial Women (18-34) General Recall, Brand Linkage Q3 2014 – Q2 2014
“This is a man’s world, Keira Knightley” Chanel – Coco Mademoiselle
Ad Awareness
179 Brand Association
150
“Marilyn Monroe” Chanel – No. 5
Ad Awareness
148 Brand Association
218
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BREAKTHROUGH
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ROADMAP FOR SUCCESS Connected by their ability to breakthrough
TV ONLINE IN-STORE
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BREAKTHROUGH WITH TV
TV
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• Tell a STORY and leverage a SPOKESWOMAN
• Make it RELATABLE and occur in home or familiar location
• DEMONSTRATE product
• Emphasis on multi-benefits and/or EFFICIENCY OF PRODUCT
• Tell a STORY and leverage a SPOKESWOMAN
• Communicate SIMPLICITY of product application
• Highlight product benefit and resulting LIFESTYLE CHANGE
“Older Millennials” Women: 26-34
“Younger Millennials” Women: 18-25
Source: Nielsen TV Brand Effect
LOOKING AT MILLENNIALS DIFFERENTLY
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LIST THE LEARNING…… Clinique ad delivers on “demonstration” and “efficiency”
Source: Nielsen TV Brand Effect –Creative Evaluation, Skin care, A18+, October 2014
Clinique, Sonic Cleansing Brush, ‘Hello’, :30s
Demo: F18+ Connected emotively & felt it provided valuable information
EMOTIVE
INFORMATION
103
132
Clinique ad REALIZES strong information power with the female audience (F18+)
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37 Source: Nielsen TV Brand Effect: Ads indexed against total top advertising beauty ads within collection of Hair Care, Cosmetics, Fragrances, Skin Care for for Younger & Older Millennial Women General Recall, Brand Linkage Q3 2014 – Q2 2014; Homescan Panel AOD, 52 weeks ending 06/28/14
Jennifer Garner DOLLAR SALES CHANGE
+20% Buying Households During the year the Ad aired
Neutrogena Cleansing Wipes
170 152
105 168
Older
Younger
Millennial women:
Brand Association Ad Awareness
NEUTROGENA WINS WITH MILLENNIAL WOMEN
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HEAD & SHOULDERS SCORES WITH TROY POLAMALU
Source: Nielsen TV Brand Effect Analysis- Ads indexed against total top advertising beauty ads within collection of Hair Care, Cosmetics, Fragrances, Skin Care for Younger (ages 18-25) & Older Millennial (26-34) Males General Recall, Brand Linkage Q3 2014 – Q2 2014
Troy Polamalu DOLLAR SALES CHANGE
+14% dollar sales growth During the month of the ads launch
HEAD & SHOULDERS
2x 1.5x
2.5x 2x
Older
Younger
Millennial males:
Brand Association Ad Awareness
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ONLINE
BREAKTHROUGH ONLINE
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-3%
Total Beauty Trips Year/Year Change
Mass Market Prestige Online
+3%
Instead, they are going online for
Beauty
CONSUMERS INCREASINGLY PREFER ONLINE
Source: Nielsen Homescan, Total U.S. 2014 Beauty (Makeup, Hair Care, Skin Care, Fragrances), Pure Play Online
-12%
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PURCHASE CYCLE
Mass Market
Department
Online
DOLLARS PER BUYER
32 days
84 days
66 days
$128
$172
$86
TRANSACTIONS HIGHER IN BRICK AND MORTAR Higher purchase frequency in Mass; higher transaction within Department
Source: Nielsen Homescan, Total U.S., 2014 Beauty (Makeup, Skin Care, Hair Care, Fragrance) Pure Play Online market
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↓ Low Usage ↑ High Brand Lift
OPPORTUNITY TO SHIFT ONLINE AD PLACEMENT
Source: Nielsen Online Brand Effect: 300+ campaigns since 2010, however the majority of them fall between 2012 and 2014
SEARCH ENGINES
ENTERTAINMENT
↓ Low Usage ↑ High Brand Lift
↑ High Usage ↓ Low Brand Lift
AD NETWORKS
NEWS AND INFORMATION
FAMILY AND LIFESTYLES
HOME AND FASHION
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BREAKTHROUGH IN-STORE
IN-STORE
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+32% vs.
YAGO
+57% vs.
YAGO
STRONG PACKAGING = STRONG SALES
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SIX STEPS TO SHINE ON SHELF A case study in Beauty
1. HAVE MANY NATURAL VIRTUES Packs that look more “natural” lost other desirable qualities such as looking innovative, effective, glamorous, etc. 2. CHOOSE YOUR WORDS WISELY Women of varying ages have different mindsets around aging; sensitive to word choices. 3. CLEARLY DESCRIBE IT Ingredient claims attract much attention relative to other pack elements.
Source: Nielsen Package Design Trend Watch: Anti-Aging Beauty 2014
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A case study in Beauty
4. LET ME COUNT THE WAYS Anti-aging products that promise multiple benefits fare well.
5. HARNESS THE BEAUTY OF BENEFITS Benefits garner more attention and elicit more reactions than any other area of a package, including ingredients and brand name.
6. SHOW THEM A GREAT TIME Top-performing anti-aging packs set specific expectations for how long a product will take to make a noticeable difference.
Source: Nielsen Package Design Trend Watch: Anti-Aging Beauty 2014
SIX STEPS TO SHINE ON SHELF
SUMMARY OF KEY INSIGHTS
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CALL TO ACTION
Focus distribution among leading and growing channels which collectively result in nearly $48 billion in beauty sales; the scale remains in mass, with growth in prestige and online outlets.
1
3 Reverse industry wide underperforming ad effectiveness, by developing ads which have a strong storyline and appeal to key sub-demographics.
4 Shift online campaigns to those generating higher brand lift, which are Search and Entertainment sites.
5 Breakthrough on shelf with package designs and terminology which not only resonate with consumers but generate strong sales.
2 Align to the larger consumer trends of: Health & Wellness, Multicultural, and Men, to drive sales growth.
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WHO TO CONTACT FOR MORE INFORMATION
1. OVERALL BEAUTY TL [email protected] [email protected]
2. NIELSEN/NPD CROSS CHANNEL [email protected] BEAUTY REPORT
3. CONSUMER PANEL [email protected]
4. MULTICULTURAL INSIGHTS [email protected]
5. TV BRAND EFFECT [email protected] [email protected]
6. NIELSEN DIGITAL AD RATINGS [email protected]
7. PACKAGE OPTIMIZATION [email protected] [email protected]
8. GLOBAL TRACK COMPLETE [email protected]
Use the “Download the Deck” widget at the bottom of your screen to save this list
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TWEETABLE TAKEAWAYS
• Beauty category sales are gaining ground in prestige and online retail channels, but mass is still the leader. –via @Nielsen
• Beautiful Opportunity: Beauty product ads are 20% less memorable on general recall for women 18+ vs all other CPG – via @Nielsen
• Across Beauty Care, Hispanic Americans spend on average 34% more than expected based on their population. -Via @JRussoNielsen
• Via @JRussoNielsen - Beauty product packs that look more “natural” lost perceived qualities like looking innovative, effective, glamorous
LinkedIn @JRussoNielsen James.Russo @nielsen.com
