While the market for shampoo has increased year on year from £395 million to £397 million in 2008, the market value of conditioners stood at £303 million in 2008 – a drop of £8 million from the previous year. The conditioner market is forecast to see decline well into at least 2010 as Brits continue to economise. Research shows conditioners are likely to be hit by a cutback on hair treatments with as many as 14% of users having stopped using them in order to save money.
In response to the recession, a quarter of female shampoo users have spent less on shampoo, contributing to an estimated £15 million slide in value of the total market between 2008 and 2009.
Price promotions and a savvy consumer waiting for regular brands to go on special offer are expected to contribute to difficult trading conditions and this is expected to see £6 million wiped off the value of the UK’s shampoo sector in 2009.
With saving money top of people’s shopping lists, grocery multiples with their wide range of products and price promotions are winning market share. A quarter of women now wait until their regular brands are on sale before they buy their haircare products and this approach is benefiting the grocery multiples, which have grown since 2007 but dropped by an estimated £1 million since 2008.
Heavy discounting is eroding value sales for multiple retailers, which although increasing share of sales by an estimated 2 percentage points between 2007 and 2009, could see value sales slide in 2009.
As people stay away from the high street in order to save money, high street chemists are losing out, with value sales estimated to fall between 2008 and 2009.
Meanwhile, local chemists lack the ability to compete with the grocery multiples and the larger drugstores on price and are losing out to these channels. Economies of scale mean that other chemists lack the ability to compete on price, and this is encouraging people to pick up their shampoos and conditioners when doing the grocery shopping rather than when they pick up their prescriptions and other medications.
In terms of new opportunities in the market, confusion between product build-up and dandruff could create new opportunities for hair styling products in the shampoos and conditioners category.
Meanwhile, an upsurge in innovation in male-specific shampoos and conditioners has helped drive take-up, although penetration stands at just under 5%. Driving penetration of conditioners amongst men and driving frequency of use amongst women will help grow sales of conditioners.