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1Copyright 2010. The NPD Group, Inc. All Rights Reserved. This presentation is Proprietary and Confidential and may not be disclosed in any manner, in whole or in part, to any third party without the express written consent of NPD.

Makeup In-DepthConsumer Report

May 2010

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Table Of Contents

About The Study 5

Introduction: Market Overview 8

Executive Summary: Implications 10

Key Findings 15

Beauty Overview 29

– Beauty Category Usage Incidence

– Cross-Category Usage

Makeup Usage Dynamics 33

– Makeup Users By Demographics

– Demographic Distribution Of Makeup Users

– Reasons Wear Makeup

– # Of Makeup Products Used In A Typical Day

– Types Of Makeup Products Used

– Makeup Cross-Product Usage

– Frequency Use Each Makeup Product

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Table Of Contents

Makeup With Benefits 57

– Types Of Makeup Products Using That Are Natural/Mineral-Based

– Types Of Makeup Primers Using

– Types Of Skincare Benefits Makeup Products Used Contained

– Foundation Coverage Usually Wear

– Foundation Formula Usually Wear

– Foundation Benefits Considered Important

– Mascara Benefits Considered Important

– Lip Shade Worn Most Often – Lipstick, Lip Gloss

– Lip Benefits Considered Important – Lipstick, Lip Gloss

Makeup Shopping Behavior and Preferences 77

– Attitudes About Makeup

– Makeup Shopping Preferences

– Frequency Make A Replenishment Purchase

– Planned Versus Impulse Purchasing

– Price Most Willing To Pay For Each Makeup Product

Channels/Retailers Purchased Makeup Products From In The Past Year 106

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Table Of Contents

Makeup Brand Awareness and Usage 130

– Makeup Brand Awareness

– Makeup Brand Past Year Usage

– Makeup Brand Conversion (Past Year Usage Among Those Aware)

– Makeup Brand Used Most Often

– Makeup Brands Currently Using For Each Makeup Product

Makeup Brand Perceptions 148

– “Hot” Vs. “Not Hot” Makeup Brands – Unaided Mentions

– Attributes – Top 10 Makeup Brand Rankings

Appendix (Separate Deliverable)

– Makeup Brand Perceptions – Attribute Summary Tables 3

– Makeup Brands At A Glance 55

– Additional Charts 128

Frequency Use Each Makeup Product By Age And Race/Ethnicity 129

Frequency Make A Replenishment Purchase By Age And Race/Ethnicity 133

Planned Versus Impulse Purchasing By Age And Race/Ethnicity 137

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About The Study

This Makeup In-Depth Consumer Report is an update to the report released in April, 2008. The age group for the study done in 2010 was expanded from women 18-64 to be inclusive of women 65 or older. Therefore, a nationally representative sample from NPD’s Online Panel was used to target women aged 18 or older.

This report aims to uncover opportunities and threats by monitoring shopping and usage habits, as well as purchase drivers.

Total channel view is provided with the ability to focus specifically on prestige, mass or specialty.

The report measures female beauty consumers’ brand awareness and usage of makeup products to uncover patterns in consumer behavior. It identifies core consumers of your brand and your competition’s brand. The report aims to identify strengths and weaknesses by benchmarking brand image ratings vis-à-vis competition.

Consumer perspective on makeup by product category and sub-category is explored to help companies better understand how and why women use their products.

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Methodology

Face

Eye

Lip

The Makeup In-Depth Consumer study utilized NPD’s Online Panel and fielded March 10 - 31, 2010. A nationally representative sample of females 18+ was targeted.Panelists were asked about makeup.Total returns were weighted to reflect census targets for demographics. See Appendix for specific weighting information (page 56). Ending sample sizes are as follows --

Total Contacts N=22,408

Total Makeup Users Answering Overall

Category Questions

N=14,125

Makeup Users Answering Full

Survey (Overall and In-Depth Questions)

N=7,975

Foundation 8,749 4,982Powder 7,270 3,849Blush 8,455 4,846Concealer 5,242 2,927Bronzer 2,125 1,190Tinted Moisturizer* 1,609 Not Asked

Mascara 10,467 5,848Eye Shadow 9,225 5,140Eye Liner 8,315 3,871

Lipstick 8,648 4,945Lip Gloss 6,865 3,833Lip Liner 2,929 930

Total Used

Used/Selected For

In-Depth Survey

* Tinted Moisturizer is a hybrid product that can be considered a skincare and/or makeup product. Only topline information was collected for tinted moisturizer usage among makeup users who used this product as makeup.

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Makeup Brands

The following list of makeup brands was used for this study on an aided basis:

Almay Giorgio Armani Cosmetics Physician's FormulaAmerican Beauty (at Kohl's) Hard Candy PrescriptivesAvon Lancôme Prestige CosmeticsBare Escentuals/I.D. bare Minerals Laura Mercier RevlonBenefit Cosmetics L'Oreal RimmelBobbi Brown L'Oreal HIP Sally HansenBoots Lumene (CVS) Sephora (Brand)Chanel M.A.C. ShiseidoClarins Make Up For Ever SmackersClinique Mary Kay SmashboxCover Girl Maybelline Sonia Kashuk (at Target)Dior Merle Norman Stila Cosmeticse.l.f. (eyes lips face) Milani Too FacedElizabeth Arden Nars Trish McEvoyEstée Lauder Neutrogena Urban DecayFashion Fair NYC New York Color Wet N WildFlirt! (at Kohl's) Origins Yves Saint Laurent

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About NPD

ABOUT NPD BEAUTYNPD Beauty is a division of The NPD Group, the authority and leading provider of sales and marketing information for the beauty industry. NPD Beauty introduced the first retail point-of-sale tracking service for beauty in the U.S. department stores in 1996. Since then, the Beauty division has developed a line of products and services to address the needs of the growing fragrance, color cosmetics and skincare industries. This includes shade-level detail in makeup, weekly data in fragrances, scent and concept testing and ad-hoc and in-depth consumer reports on issues that impact the clients’ bottom line.

ABOUT THE NPD GROUP, INC.The NPD Group, Inc. (NPD) is a global market information company that measures product movement and consumer behavior across a broad range of industries - apparel, automotive products, consumer electronics, cosmetics and fragrances, food, foodservice, footwear, housewares, information technology, interactive entertainment, toys and music.

NPD's clients, many in the Fortune 500, use this insight to uncover market opportunities, strengthen channel relationships and benchmark industry performance. Since 1967, NPD has introduced numerous industry firsts, most recently combining and calibrating information from consumer panels and point-of-sale tracking via its flagship services, the NPD Worlds. The firm has offices and affiliations in 60 countries.

For more information on The NPD Group, visit npd.com.