Cosmetics and personal care is a fast-moving, fast-growing industry. McKinsey & Company forecasts the global beauty market to grow by 5% per year up to 2030, and dentsu’s Global Ad Spend Forecasts report predicts ad spend growth of 6.1% in 2025, 5.5% in 2026 and 5.0% in 2027.
In this article, we look at some of the major trends fueling the growth of the cosmetics and personal care industry.
A category reinventing itself
The industry’s growth is more about quality than quantity, with many buyers willing to pay more and embracing what is referred to as clean and clinical beauty, essentially a redefinition of the category to efficacy and the measurable value of products, rather than a focus on brand names and celebrity.
We see evidence of the lipstick effect, a trend defined by Leonard Lauder in the early 2000s which argues that people buy more small, luxury items in times of recession. In addition, we are seeing the growth of buying by more mature consumers, with new products for life stages like menopause, and a focus on the idea of the beauty within and its connection to more holistic wellness rather than just appearance. Social media has also been empowering for older women, who want to look and feel good now more than ever.
This clean beauty trend is also seen in the revival of pharmacy style skincare brands, especially in the EU, and acquisitions from major brands like L’Oreal having a bigger focus on the dermatology element of personal care. All of this gives both new and existing brands a strong incentive to tell their stories and to educate consumers about the attributes, ingredients and benefits of their products.
Dupes, or close duplicates of well-known products, have become very popular in recent years, and now these brands are also focusing on creating products with similar active ingredients and performance, rather than just lookalikes. This increases the number of products in consumers’ consideration sets, increasing the impetus for brands to advertise to stay top of mind.
Social platforms open new growth opportunities
Social media algorithms increasingly know the user and are starting to act almost like personal shoppers. They learn by observing a consumer’s behavior and searches and are then able to make useful recommendations of other products that may interest the consumer.
Influencers are becoming essential for brands as they are able to give authentic views on brands and make relatable recommendations based on their own experience and tastes. New platforms of influence are emerging including Discord, long seen as the preserve of male gamers, but now with some very interesting and influential voices for the industry. Creators are also having an increasing impact on search and discovery, with traditional search engines, AI search platforms like ChatGPT and Perplexity, and retail and social platforms likely to include creator content in their rankings.
Add the facts that many digital platforms are now shoppable, especially TikTok Shop, and that this category is perfect for ecommerce with many small, light products that can be easily fulfilled, and we see the gap between inspiration and purchase is shorter than ever.
This convergence of inspiration and purchase drives ad spend, because brands can increasingly see a direct link between advertising and their revenues, including which elements of the campaign are the most successful and deliver the most ROI.
From changing consumer expectations to the increasing role of creators, 2026 is set to be a growth year for advertising in the Cosmetics and personal care category. To find out more about ad spend trends across industries, download the dentsu Global Ad Spend Forecasts report today.
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