Ethnic Products Now Front and Center

In the mid-1970s, Flori Roberts was sold in Abraham & Strauss department stores (Federated). Flori Roberts claims that they were the first Black cosmetics line to be sold in upscale department stores. The very nature of the cosmetics business involves making people of all complexions look their best.

Mark Lilien, Consultant, Retail Technology Group

Fits and Starts is a great way to describe it, but mostly "Fits." Ethnic Cosmetics will never be BIG business in FDM because of several structural issues:

1. Ethnic consumption and spending on the category is much lower (30%+) than for Whites.

2. Except for Face Cosmetics, there's not a lot of rationale for Ethnic-specific products.

3. The lower sales productivity from these products means that the major brands will serve up these items during planogram review season to make way for new products and Subbrands.

4. These products are only sustainable if they deliver above average margins, and that typically can't be delivered within a major franchise platform. It's really only the smaller vendors that can do that.

That said, there should always be a place for Ethnic Cosmetics in any FDM assortment because Ethnic consumers comprise over 20% of the US population now. It is a segment best serviced by the targeted brands like Black Opal, not the big guys. However, the segment should be treated as a niche and not as a major opportunity.

Kurt Jetta, President, TABS Group, Inc.

As our industry and the retail department store types know, the make up of the population has been changing over the last ten years. Few have taken the major step(s) necessary to focus on stand-alone ethnic cosmetic stands or supplemental display centers with makeup artists from the comestic companies.

As the department stores secure makeup artists, the supermarket industry could do likewise and have special classes and individual sessions for their female shoppers.

Point of difference, and profitable--yes! Hmmmmmmmmmmmm

Stephan Kouzomis, Faculty and Staff Member, University of Louisville's College of Business

No question that retailers that do not have ethnic efforts are leaving money on the table. In my keynote on Thursday to the Hispanic Boom Conference here in L.A., I will be making the following points:
1. Hispanics are now the nation's largest minority group.
2. Projections for further growth are astounding.
3. Native-born Hispanics will fuel Hispanic population growth in the future.
4. The Latino population extends beyond traditional metropolitan areas to include suburban fringes, small cities and towns, rural areas, and Southern states.
5. Hispanic buying power will reach $1 trillion by 2008, and continue to grow 9% a year.
6. The Hispanic population is the fastest-growing sub-market for almost every consumer product or service.
7. The Hispanic urban youth market is large, growing, lucrative and influential.
8. There will be plenty of both assimilation and separatism among Hispanic Americans in the coming decades.

Feel free to contact me for more info.

Roger Selbert, Ph.D., Editor & Publisher, Integrated Retailing

Ethnicity today is nothing more than a demographic segment due to the continued blending of the US population. For that reason alone it's impossible for a retailer to ignore any single ethnic group beyond what the demographics of a particular store's location would dictate.

In the next five years we're going to see ethnicity become an even bigger player as it we will find many more brands attempting to use ethnic focus as a way to stand out in a category.

Mark Hunter, President, TheSalesHunter.com