Beauty continues its impressive growth trajectory, up 12% in Q2 2023 


Beauty continues its impressive growth trajectory, up 12% in Q2 2023 

The U.S. beauty and personal care category continues to grow, delivering a 12% increase in dollar sales in the second quarter of 2023, reaching $25B in sales for Q2 2023. Over the past year, sales are up 11% to a total of $96.6B for the category. While online sales remain the growth driver in Q2, with a growth of 18% quarter over quarter, in-store sales also delivered an impressive 9% growth in Q2. The category is still facing inflationary pressures, with prices across beauty and personal care continuing to rise. The good news is that, despite rising prices, unit sales have returned to growth this year, showing that consumers are willing to keep investing in beauty and are not willing to give up their routines. 

Standout category types

On a more in-depth category type level, all categories within beauty and personal care grew in dollar sales over the past year. Standouts were the following (percentages are gains in dollar sales): 

  • Cosmetics and nail (+14%) 
  • Deodorant (+17%) 
  • Facial skin care (+12%) 
  • Fragrances (+14%) 

Growth segments

Growth in Q2 2023 could be found across the entire store, but a few segments really stood out: 

  • Facial treatments, up 36% in dollar sales — Treatments such as facial serums have become more commonplace as consumers incorporate them into their skincare routines. With this spread of information, the younger Gen Z cohort is using skincare at an earlier age to take more preventative steps and is experimenting with newer treatments such as acne patches.   
  • Lip cosmetics +27% — The lipstick index continues to prove its value as consumers flock to this inexpensive pick-me-up in times of economic uncertainty.  
  • Men’s hair grooming +21% — Men are increasingly spending more time on their grooming routines, looking for products that were made just for them, and even posting about their routines on social media.  
  • Cologne and perfume +13% — We continue to be in a fragrance era, with Gen Z consumers discovering their love for fragrance and even willing to purchase “scent-unseen.”  
  • Artificial nails +13% — Artificial nails are now outselling traditional nail polish. As product technology has improved and prices have risen in nail salons, more and more shoppers are turning to DIY nail kits to get the looks they are after. 

Second half of 2023 outlook

Inflationary dynamics are still at play in beauty and personal care as dollars continue to outpace unit sales and the average unit price continues to climb. Looking ahead to the back half of the year, we can expect to see the effects of inflation continue to impact the beauty and personal care category. The coming months will be important to monitor as we grapple with U.S. consumers’ student loan relief ending right at the start of the approaching holiday season. The holidays are an important time for the category, but many consumers will have to face them with less disposable income. Staying on top of the trends and understanding the changing consumer needs will be critical in the coming months.  

The Beauty Inner Circle report

Looking for more beauty insights? The Beauty Inner Circle report has you covered with a deeper dive into category sales and market dynamics to capture valuable insights into the latest trends.