Beauty industry sales remain buoyant, however the drivers of its growth are evolving.

In line with Circana, prestige beauty dollar sales grew 14 percent this yr through September; and mass market dollar sales grew 8 percent through the same period.

Unit sales continued to rise across all prestige categories, while mass unit sales were down 2 percent and three percent in hair care and fragrance, respectively, though average price increases propped up revenue growth within the categories.

Cosmetics and skincare, nonetheless, “are healthy categories in each mass and prestige,” said Larissa Jensen, senior vice chairman, global beauty industry adviser at Circana.

Makeup maintained its position because the fastest-growing category inside prestige by revenue growth, posting $7.1 billion in sales year-to-date, up 16 percent versus last yr. Lip makeup was the fastest-growing segment, driven namely by lip oils, balms and glosses, though lipstick sales also rose.

In line with Checkout, Circana’s receipt-based tracking service, spend per buyer on makeup increased 10 percent this yr, while purchase frequency rose by 4 percent.

“We see a trade-up happening in categories like makeup and hair; designer brands make up about 10 percent of sales, give or take, but they’re growing at a faster rate of greater than 20 percent by way of dollars,” said Jensen, noting that in skincare and fragrance, an opposite shift is starting to happen.

Skincare was the fastest-growing category in prestige to this point this yr based on units sold, and the only category where average prices remained flat. A growing shift toward “lower-priced brands within the prestige skincare universe,” Jensen said, is “driving unit sales in an enormous way” inside the category. Two of the most important growth drivers were face serum and face creams, which were up 21 percent and 12 percent in dollar sales, respectively.

In fragrance, too, luxury units sold have only risen 1 percent this yr, though the category at large has seen a 13 percent revenue increase.

“Luxury fragrance has been outperforming the fragrance category for quite a while, and 2023 is the primary time we’re beginning to see a slowdown in that,” said Jensen, adding that because many consumers stocked up on luxury fragrances following the category’s initial post-pandemic boom, they at the moment are turning to value-focused offerings resembling fragrance sets — sales of which increased at greater than double the speed of juices this yr — body sprays, and smaller bottle sizes.