Top Players in the Global Men's Skincare Industry

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Leaders in the Global Men's Skincare Market

L'Oreal Men, P&G and Johnson & Johnsons are key players in the global men's skincare market.

Helpful findings

  • The global men skincare industry had an estimated market size of $34.9 billion in 2018 and is expected to grow at a CAGR of 3% over the 2019-2023 period.
  • Based on the various research reports, the key players operating in the men's skincare market include Johnson & Johnson, Beiersdorf, Estee Lauder Companies, L'Oreal, Procter & Gamble and Unilever. (Source#2)
  • Some brands operating in the men only grooming market include Tom Daxon, Brooklyn Grooming, Pankhurst London & Triumph & Disaster.
Below are the statistics on the key players and their revenues from the segment where they report men skin care.

L'OREAL MEN

  • The company operates in Skincare, Haircare, Makeup, Fragrances and Hygiene products segments and reports the revenues pertaining to the men skincare segment under 'Skincare'. The Company does not segregate the men skincare segment in the overall Skincare segment. In addendum, the skincare segment represented 39% of the company's total sales in 2018.
  • The Company's total revenues for 2018 was €26.9 billion, thereby giving skincare segment sales of €10.49 billion (26.9*0.39).
  • Using the USDEUR exchange rate, the 'Skincare' segment sales computes to $12 billion (10.49*1.144).
  • Based on the total industry size of $34.9 billion this translates into a 34.4% market share. (12/34.9*100)

COMPETITIVE ADVANTAGE
  • High scale internal Research & Innovation capabilities which provide the company with the ability to turn scientific discoveries into innovations and then into safe, effective products are its key competitive advantage. The company is focused on the use of microbiome, regenerative, cosmetics and non-invasive materials in the products that allow it to be more appealing to the customers.
  • In addition, the company which has traditionally relied upon saloons as its primary distribution channels is fast embracing new distribution channels like e-commerce, while ensuring that salons are exceptionally appealing and competitive.
  • Unlike many other companies, the company has a dedicated product line for men's grooming products by the name 'Men Expert' which targets for expert quality of products and offers a wide range of products for men at all stages. The brand has proved extremely successful for the company owing to its superior quality, continuous improvement and attention to consumer needs. This has allowed the company to make inroads into the men segment and dent the competitor's market share.

P&G MEN SKINCARE

  • The Company operates in Beauty, Grooming, Health Care, Fabric & Home Care & Baby, Feminine & Family Care. The men skincare sub-segment forms part of the Beauty' segment and the Company reported that the Skin and Personal Care sub-segment within the Beauty segment represented 9% of the Company's total sales in 2018. The Company has, however, not provided any separate breakup or revenue segmentation for the men skincare segment.
  • The company's total sales in 2018 were $66.8 billion and hence the sales of Skin and Personal Care sub-segment aggregate to $6.01 billion. (66.8*0.09)
  • Based on the total industry size of $34.9 billion this translates into a 17.2% market share. (6.01/34.9*100)

COMPETITIVE ADVANTAGE
  • The company creates competitive advantage through superior product performance, packaging, brand communication, retail execution, and consumer and customer value.
  • The Company's marketing prowess serves as a huge competitive advantage for it. It invests nearly $5 billion in advertising each year, making it the single biggest spender on the market and hardly any companies in the world can claim anything approaching Procter & Gamble's marketing strength. Its marketing program is about much more than just ads.
  • They are one of the most profitable companies in the industry and enjoys one of the best-operating margins among its peers (22%), thereby, allowing the company to be financially sound and also embark upon the expansion plans as well invest in R&D and undertake other CAPEX which enhances its market share.
  • Another key competitive advantage of the company is its superior and best of class supply chain operations. The Company is dramatically transforming its supply chain and over the past few years, has made major investments into the same. For example, the Company is driving down cost and inventory with its Supply Network Transformation and is making progress towards synchronizing the supply chain with real-time point-of-sales data.

JOHNSON & JOHNSON MEN SKINCARE

  • The company operates in 3 segments namely (i) Consumer, (ii) Pharmaceutical and (iii) Medical Devices. The Consumer segment has been further sub-segmented into Beauty, OTC, Baby Care, 'Oral Care, Wound Care/Other & Women's Health and the company reports the revenues related to the men skincare products under the Beauty sub-segment. The company has, however, not provided any separate breakup or revenue segmentation by brand or for the men skincare segment alone.
  • The company's total reported revenues for 2018 for the Beauty Segment which includes men skincare revenues were $4.382 billion.
  • Based on the total industry size of $34.9 billion this translates into a 12.5% market share. (4.382/34.9*100)

COMPETITIVE ADVANTAGE
  • The company's constant investment in R&D and innovation is the key to its ability to create meaningful change and competitive differentiation. In 2018, Johnson & Johnson achieved a record-level of Research and Development (R&D) investment of approximately $10.8 billion and was one of the top 10 companies among all industries in terms of R&D.
  • The Company's focused market strategy also is a driving force behind its competitive advantage. The management team is very focused on investing only in markets that the company can dominate. Today, over two-thirds of J&J’s sales are from a couple of global market share positions, and management has shown a willingness to divest under performing or non-core parts of the business over time. This has allowed the company to focus and add strength to its core operations.
  • The company's enormous size (more than $70 billion in revenues) and the economies of scale that go with it, as well as its strong consumer name brand products, drive the competitive advantage for the company. The Company has developed over 20 brands with more than $1 billion in annual sales, including a number of leading consumer products. This gives J&J a big advantage because the off-patent nature of these products means that they generally don’t face high levels of competition and cost very little for Johnson & Johnson to produce on an industrial scale.

Research Methodology

We were not able to identify companies operating only in the men skincare market. We began the research by searching through industry reports by MarketsandMarkets, Technavio, IBIS World, Gartner, Market Insider, Business Wire and others. Although we were able to identify a few reports (Source#1) specific to the men skincare market the revenue and market share information could not be retrieved for them. Most of the information other than the name of the players was behind the paywall. After identifying key players operating in the men skincare segments using the above mention strategy, we tried to deduce the men skincare segment sales for the identified companies as they all operate in a variety of beauty segments, however, there was no specific information apropos of this aspect after deploying the below comprehensive strategies.

Firstly, we combed through the company websites in search of annual reports, 10-K statements, 10-Q filings, 8-K statements, Earnings transcripts, presentations, supplemental information filings etc. None of the companies had financial information broken down by segments in which they operate such as the men skincare segment, however, P&G included the same as part of 'Skin and Personal Care' sub-segment, J&J as part of 'Beauty' subsegment while L'Oreal reported the same under 'Skincare' in their Annual Reports.

Next, a search was carried on company databases such as Owler, Crunchbase, Craft, ZoomInfo, Hoovers, Bloomberg, Capital IQ etc in order to find information on revenues of the companies from each segment of their operations. This, however, didn't prove productive as the data found using this strategy was for the overall estimated revenues of the companies and included no information specific to men's skin care segment.

After then, we decided to consult third-party broker reports from GS, RBS, JPM, Moody's, Fitch etc on these companies. Such reports especially the initiating coverage reports normally contain information about the revenue segmentation for the respective company as brokers use the same to derive 'sum of the parts' valuation for the company that they track and hence idea was to see if any of the brokers have specifically broken out the company sales into men skincare segment. However, all the reports had segment breakup in line with the respective company's financial statements and none had broken out the sales for the men skincare specifically.

We then carried out a search through various media and financial articles from Forbes, WSJ, Business Insider, Bloomberg Quint, Seeking Alpha, Reuters etc and some corporate finance specific blogs such as 'ONEtoONE Corporate Finance', 'Corporate Finance Newsletter', 'Fox Corporate Finance' etc. The idea was to note from these sources any numbers apropos of the men skincare segment sales globally and any revenue breakout for the top players for this segment. Although we were able to locate the mention of these companies as top players in few of the media articles in the men skincare market there was no information found apropos of the revenue associated with the segment for these companies.

After our strategies to find the revenue generated by the players in the men skincare industry failed, we turned to find companies that produce only men skincare products using the strategies below.

First, we scour through various industry reports specific to Men Skincare industry, Men grooming industry, Personal care industry etc from Market Insider, Businesswire, Gartner, Forrester, Deloitte, Mckinsey etc. These are the most potent source for any players related information and hence I tried to leverage this route. Although we were able to locate a few men skincare industry-specific reports (Source#1), the list of companies provided in the same were all big key players in the beauty industry like P&G, L'Oreal, J&J etc which operate in various beauty segments in an addendum to men skin care. Hence, no fruitful information could be garnered from this strategy.

Then, we searched through media articles from Forbes, WSJ, Business Insider, Bloomberg Quint, Reuters etc, blogs specific to men grooming such as The Grooming Guru, Nerd Fitness etc, men grooming sites and magazines like Men's Biz, Man Face, The Men's Room etc and any surveys around the top brands/players in the men skincare market from Pew Research, Market Insider etc. The idea was to check if any of them have talked about any men only skincare brands. While some of these sources provided me with an encore of the names of big players like P&G, Unilever etc, others gave me the names of the few men only grooming companies. However, apart from skincare, these companies operated in a variety of other men grooming products like hair care etc and hence their revenues could not be directly used. We tried to check through their website, company filings, company databases and broker reports if any of them break out their revenues for skincare segment but All these were private companies with extremely limited financial information. We were able to find revenues for a couple of them through Owler but again no segregation into men skincare was available. We have included them as part of my useful findings.

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