Port Washington, NY, April 29, 2009 - The NPD Group, Inc., and Information Resources, Inc. (IRI), leading market research providers, announced the results of the first year of their partnered product, the Beauty Cross Channel Monitor, the U.S. beauty industry’s first and only point-of-sale tracking product that looks at sales performance in department stores (prestige) and the food, drug and mass market, excluding Walmart (FDMx).  According to the study, while total beauty sales were down across the combined markets, consumers are switching channels in some key categories, which could present opportunities in today’s challenged marketplace.   

"For the first time we have the ability to take a broader view of the U.S. beauty industry," said Diane Nicholson, president, Beauty, The NPD Group, Inc. "When looking across total channels - department stores and food, drug and mass channels, excluding Walmart (FDMx) - we can size the market at $19.1 billion dollars, representing approximately 60 percent of the U.S. beauty industry."

Historically, the beauty industry has weathered store closings, recession, and war with strong sales, but, in 2008, the beauty industry suffered the same fate as most industries and posted declines.

Nevertheless, there were pockets of growth and opportunity, driven by some channel shifting by consumers.  While department store sales of makeup declined, makeup posted a slight increase in the FDMx channel.  Conversely, the hair segment, although representing a relatively small portion of the prestige business, grew by 6% in department stores vs. the decline of 4% in mass, where hair represents a larger portion of the overall business. 

CROSS CHANNEL BEAUTY SALES

2008 VS. 2007

Source: Beauty Cross Channel Monitor

(Total Channels=Department Stores, Food, Drug and Mass (excluding Wal-Mart)

Skincare sales remained steady across all channels.  A bright spot worth noting is the facial skincare segment, which represents 40% of the overall skincare business and rose by 1 percent across all channels, driven by a more healthy performance in mass, with 2.1 percent growth in 2008.

The top 10 brands in the facial skincare segment across total channels, according the Beauty Cross Channel Monitor are:

"In this ever changing and challenging environment, the ability to understand the market dynamics across channels is more crucial than ever."said John Deputato, senior vice president, Client Solutions, IRI. "O ur clients are very interested in how consumers are changing their shopping patterns."

Both NPD and IRI jointly stated that they were excited to announce that this year, based on client’s feedback, the Beauty Cross Channel Monitor will be enhanced to include additional views into fragrance house sales as well as providing an executive summary with a more effective top-line view of the quarterly and annual results."

About The NPD Group, Inc.
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,600 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us or visit http://www.npd.com/.

About Information Resources, Inc.
IRI is the world’s leading provider of consumer, shopper, and retail market intelligence and insights supporting 95 percent of the FORTUNE Global 500 consumer packaged goods (CPG), retail and healthcare companies. Only IRI offers the unique combination of integrated market information, automated and predictive analytics, innovative enabling technologies, and domain expertise. With IRI, leading retailers and manufacturers are able to quickly discover breakthrough insights driving smarter decisions and actions across the enterprise for breakthrough results. Companies around the world depend on IRI for improved productivity, stronger brands, and dramatic revenue growth. For more information, visit http://us.infores.com.

NPD CONTACTS:

Beth Boyle
The NPD Group, Inc.
516-625-4603
beth_boyle@npd.com

Dora Brunette
The NPD Group, Inc.
516-625-6190
dora_brunette@npd.com

IRI CONTACTS:
John McIndoe
E-mail: john.mcindoe@infores.com
Phone: (312) 474-3862
Fax: (312) 474-2512

Shelley Hughes
E-mail: shelley.hughes@infores.com
Phone: (312) 474-3675
Fax: (312) 474-2512