‘Choiceful’ Consumer Behavior Snapshot: How WK Kellogg, Molson Coors, Kraft Heinz Are Adjusting

Coty

Fragrances are having a moment, and for Coty, both prestige and mass market remain bright spots. 

“It’s really a story of two-folds … People shopping high-end fragrances are continuing to shop high-end fragrances,” said CEO Sue Nabi.  “But at the same time, you also see in the same channel entry prestige fragrances doing very, very well. So it’s not either. It’s not one or the other. It’s both at the same time.” 

Entry-level prestige fragrances are being driven by smaller and trial formats — a trend cited by other consumer goods manufacturers —  as well as the body sprays favored by younger consumers. (While not specific to Coty, Target chief commercial officer Rick Gomez noted in an earnings call last week that minis are a major growth driver for the beauty category, with travel on the rise and consumers seeking affordable indulgences at home.)

Consumers are also interestingly trading up for color cosmetics, according to Nabi. 

“Now that the prices of mass market have been increasing quite strongly in the last two years, you see some trade-up, which is really a first in this kind of environment,” she noted. “You see a portion of consumers from mass market trading up to entry prestige color cosmetics. So that’s very interesting. So we are not at all seeing trade downs. We are seeing trade ups. And we are seeing consumers operating in the different price brackets.” 

How they’re responding: Coty is implementing an internal “startup organization” to increase product innovation and capitalize on recent success from their advocacy marketing model.  The goal is to reduce the go-to-market timeline to six to nine months, down from over one year. 

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