What's Your Problem?

“Cosmeceuticals,” products that both heal and beautify, straddle the divide between cosmetics and pharmaceuticals. They can be anything from an energy-boosting mist to a wrinkle-reducing eye cream, so long it offers a benefit to the user's well-being; cosmeceuticals aren't just looks enhancements, they're lifestyle improvements.

The attraction of wellness is so great, in fact, that according to the magazine Nutraceuticals World, the cosmeceuticals segment has a market value forecast to reach $5 billion by 2007. And, as cosmeceuticals are available without a doctor's prescription, gift retailers can introduce this new segment to customers now and put themselves in position to reap a share of that $5 billion market in the years to come.

Research in the cosmeceuticals field spurs product development by established companies and kitchen table startups alike, while driving consumer demand for newly proven ingredients. Tracy Van Hoven, director of brand marketing for Woodstock, CT-based Crabtree & Evelyn, tells Gifts & Decorative Accessories that “Technology, whether it's via synthetic or natural ingredients, is moving very fast, and women today are well-informed. Consumers want more [cosmeceuticals] because we're educating them.”

Buzzword ingredients in the industry include retinol, vitamin A palmitate, vitamin C, and glycolic acid, and on the natural side, essential oils. According to Heather Burgett of Santa Monica, CA-based Fun Little Things, “Anything that has beneficial effects comes into this category. However, most of it is highly produced skin creams with new ingredients.” Burgett notes that essential oils do all the same things as the synthetic products that mimic them — though synthetics cost a lot of money to develop, a cost often passed on to consumers.

As Baby Boomers get older, they face the common ailments of age. And since, as a generation, Boomers are interested in retaining the lifestyle of youth, the market for fighting the aging process is huge. Meanwhile, tweens and teens with money to spare are more than willing to pay for acne treatment that really works.

“As women over 35 become focused on how their bodies look and feel, wellness has emerged as a category in the gift industry,” says Harold Singer, CEO of Atlanta-based Caren et Cie. “It's all about women. Fine lines, wrinkles, stretch marks, spider veins; these are what everyone ends up afflicted with in one way or another.”

The American penchant for self-improvement and quick fixes has also fueled TV programs that are getting ever more personal in their focus on self-improvement. Where makeovers once stopped with a new wardrobe and haircut, they now include chemical peels and even plastic surgery on shows such as 10 Years Younger or Extreme Makeover. Indeed, people have even begun giving plastic surgery as a gift, according to a recent article in The New York Times. Of course, the majority of customers don't have major work done. Still, the effect is to make DIY self-improvement as feasible, easy and fun as home-improvement — and make it something to share, not something to hide.

But why would consumers look to gift retailers rather than drugstores to carry cosmeceuticals? For one thing, gift product is packaged to add value, so it looks more present-able. But attractive gift packaging also blend swith a self-purchaser's luxury bathroom.

The less-medicinal setting of a gift store can make shoppers feel more comfortable about treating a cosmetic problem. “We package cosmetically, not medicinally. You may have a scar on your body, but you wouldn't think of going to a pharmacy to buy scar fade cream because it seems like medicine,” says Singer. “But if you go to a general gift store, it's very user-friendly looking. My approach is, 'It's no big deal, you have a scar, now let's fade it.'” says Singer.

Also, gift stores don't have to be comprehensive. Consumers often suffer from choice fatigue: they get too much conflicting information, don't know what to believe, and are tired of staring at walls full of options, wondering which is right for them. Gift stores can offer a manageable range of choices, so shoppers don't give up and walk away empty-handed.

Additionally, the majority of gift store sales are self-purchases, so even if shoppers buy cosmeceuticals only for themselves, stocking can be profitable. However, manufacturers report that people do gift cosmeceuticals — after a road test.

“Initially, they buy for themselves, and give [cosmeceuticals] as gifts once they see the results,” notes Singer.

Clark concurs. “A lot of people buy them as birthday or Christmas presents. That's the best kind of compliment: people say, 'It's working really well for me, why don't you try it too?' You're sharing a secret.

Aging, acne, soothing, sun, and stress are near-universal concerns. The biggest demand is always aging, says Clark. “A lot of people want acne products, sun products, and something that soothes their skin after sun or if their skin is sensitive.” Van Hoven also reported soothing as a strong interest, including salves for use after other cosmetic treatments like waxing or microderm abrasion. Other products with across-the-board appeal include lip healing beyond the usual balm.

But this is a category built on niche markets. “We can offer products for smokers, women of a certain demographic, women with certain skin ailments,” says Van Hoven. “Consumers are happy because they had a latent need for product that's finally being delivered.”

Niche products available include dark circle reduction, age spot fading, spider vein fading, scar fading, and more. Only a fraction of women may need anti-stretch mark products (or admit it), but when you add up ailments, there is something for practically everyone.

Another approach is to focus on lifestyle, not symptoms. Burgett said, “We picked problems to solve based on what consumers asked for. We used oils that were appropriate for that occasion or lifestyle. We put peppermint in Yogi Girl because it stimulates breathing, enhances energy and clears the mind. Sexy Girl has ylang ylang, which is a natural aphrodisiac. Jet Set Girl helps prevent cold and flu from traveling.” This method allows a positive focus on the person, not the problem, forges consumer identification, and means that shoppers don't even need to know what their problem is called to get relief.