Yet the flurry of activity, led so far by the entry of Procter & Gamble Co.'s Olay and supported in 2004 by a 9.6% increase in media spending by the top 10 brands, has been slow to energize the category. By the tally of Information Resources Inc., excluding Wal-Mart Stores, dollar and club stores, category sales slipped 3.7% last year to $743 million, though it began to show modest growth in early 2005 when Wal-Mart sales are included.
P&G's Olay Quench has been the big winner so far in 2005, racking up just under 6 share points in the first quarter. Having failed in its first bid for a foothold in the category with the abortive 1980s launch of the Wondra brand, P&G is confident it's finally arrived. It has supported the Olay megabrand with 42% more media spending in first quarter 2005 than a year earlier. Outlays by rival Dove meanwhile slipped 1.9% in the period.
"We redefined what had been a sleepy category, both for retail customers and consumers," Susan Arnold, vice chairman-global beauty care for P&G, said at a Deutsche Bank conference this month. "Quench is on track to deliver well ahead of expectations," she noted. It's part of a new-product barrage that has tripled Olay's North American sales over the past six years and pushed global sales above $1.5 billion. Quench has been so hot that it's been on allocation with retailers, though a P&G spokesman says the marketer now has capacity to meet nearly all retailer demand.
Unilever in May created a clash of the global beauty megabrand titans in the category with the launch of the Dove Body Nourishers line of firming and moisturizing creams and lotions. "Based on the tremendous growth [of hand-and-body lotion] in specialty channels, there is significant room for growth [in mass]," says Philippe Harousseau, marketing director for Dove. TV, print, outdoor and online ads breaking this summer play on the brand's global "Campaign for real beauty" theme.
Kao Brands is doing a total overhaul of Curel, including a significant step up in media support breaking in TV, print and online this fall, says Skincare Marketing Director Dave Rose. Curel sales declined in 2004, and it slipped in market share by 0.4 points.
"Historically, Curel has been very clinical in its presentation, and we are looking to emotionally engage the consumer now," he says. The new line scraps the clinical white package in favor of a blue healing line and a green natural line. Kao also plans a Jergens restage for early 2006.
Johnson & Johnson, whose Aveeno and Neutrogena were among the bigger gainers in the category last year, also will launch an expansion of Neutrogena hand-and-body line in early 2006, including a Natural Glow product similar to the self-tanning products from Olay Quench and Kao's Jergens launched this year. Jergens' own Natural Glow product also has been on allocation, commanding double its retail price on eBay and selling at four times initial expectations since its February intro, Mr. Rose says.
As the giants battle, not all the smaller players are hurting. Alberto-Culver Co. (St. Ives' line) is one of three marketers, along with J&J and P&G, up in category share."For the past year, we've had tremendous success building our base collagen lotion business, advertising it and doing our thing," says Jim Gonedes, VP-North American skincare at Alberto-Culver. "We've had four years of continuous growth where the category declined three of those four years."