Beauty is showing resilience to broader macroeconomic headwinds, Circana data from the first half of 2025 shows.
In the U.S., the prestige beauty market grew by 2 percent to $16 billion in the first half of the year, while mass grew 4 percent to $34.6 billion, the market research firm reports.
Though prestige is slowing down from past years, Larissa Jensen, global beauty industry adviser at Circana, doesn’t interpret it as a trade-down.
On the prestige front, “dollars grew and units grew,” Jensen said. “I always talk about units as an indicator of demand. Unit performance being positive in the prestige market is a great sign.
“The market has continued to slow down every year so it’s not unexpected. But this does speak to the resilience of the industry. We look at other industries, and looking at all the other industries, beauty was one of two to grow in unit sales,” she added.
That’s also happening in the face of plummeting consumer sentiment. “The tariffs, macroeconomic uncertainties — we do see consumers pulling back. But consumers are still spending, depending on the industry. Things like apparel, technology and toys probably have a bigger impact. But they are still spending on beauty,” said Jensen.
The tides of the retail dynamics are shifting a bit as well, but brick-and-mortar remains the dominant sales channel for beauty. “Pure-play e-commerce platforms are performing so strongly that they are capturing share,” she said. “If you look across total beauty — mass and prestige combined — Amazon is the number-one retailer. But brick-and-mortar is still the largest piece of the pie by a mile on both mass and prestige.
“Brands need to be cognizant of the experiential nature of our industry. Consumers want to touch and feel and browse to look at products and there’s excitement there,” she continued. “Brands need to adopt an omnichannel strategy because you can’t go all-in on one and not the other.”
Fragrance and hair clocked the largest growth in prestige at 6 percent. For fragrance, though, that represents a $3.9 million opportunity, while for hair, the category is $2.3 billion. On the mass side, fragrance jumped 17 percent. Prestige fragrance is still seeing the same bifurcation of price points driving the growth, from both ultra-luxe offerings to body sprays and minis.
“In fragrance, we’re seeing the growth is coming from all different categories. Consumers are putting a priority on fragrance, and we’ve seen this before, from the luxury as well as the value side,” Jensen said. “Artisanal brands continue to do well, as well as designer collections. Celebrity entrants are also very strong. 80 percent of the volume comes from prestige, so with [the mass market], it’s a smaller piece of the pie that’s growing faster.”
In mass, fragrance is benefiting from private label brands at retailers like Target Corp. or Walmart.
Courtesy
Beauty is also poised for a good hair day, with Jensen saying the category is growing across segments in both mass and prestige.
“The prestige market is about 15 percent of total hair sales,” she said. “It’s a much smaller piece of the pie, but there’s a lot of innovation. From a format perspective, hair wellness continues to do well here, and there are more people who believe that styling their hair is a part of their wellness routines than lighting a candle or applying fragrance.”
Hair wellness entails strengthening products, scalp care and and other treatments such as stylers and leave-ins. “Products that address hair thinning, and products that promote hair growth, are growing at double the rate of hair,” Jensen said. “And we’re seeing more with out-of-shower treatments.” Scalp care is up 19 percent, and new launches also outpaced the hair market overall in prestige. On the mass side, commoditized pillars of the business like shampoo and conditioner drove growth.
Makeup remains challenged, particularly in mass, which Jensen attributed to store closures in the drugstore side of the business. On the prestige side, though, she’s bullish. “When you think about consumers treating themselves, they really go to the prestige channel,” she said. “That’s why we’re seeing stronger performance there. But in both mass and prestige, lip treatments are doing amazing, like lip balms and oils.”
Prestige eye makeup also reversed its decline, largely driven by mascaras.
For skin care, mass grew 4 percent while prestige dipped 1 percent. Jensen doesn’t consider it a trade-down, however. “It’s not necessarily a trade down — what’s doing well in mass is doing well in prestige, too,” she said, noting that “mass-stige” brands that span distribution in both channels are performing well.
“They have a bit of a higher luxury positioning in the mass space and more of a value positioning in the prestige channel. Mass just has an advantage of a greater footprint,” she said. “If I’m in Target, I can pick up a product I wouldn’t have to go to a prestige retailer for.”
Body care and sun care are still driving growth across channels, while facial skin care remains challenged. In mass, personal care products, like whole-body deodorants, are performing exceptionally well.
In the thick of the back-to-school season and with an eye toward holiday, Jensen defined her outlook on beauty sales in the U.S. as “optimistic,” noting that “in both mass and prestige, we will see growth through the end of the year and into 2026.”
