Researchers key in battle for beauty business

P&G has made building its beauty business a top strategic goal, one that comes from some basic trends: the U.S. baby boom population seeks ways to defy aging and will spend for it. Young people, too, are spending more on looking better. And increasingly, people in developing economies around the world have money available to spend on their appearance.

P&G estimates the combined global market for beauty and personal health care at $360 billion.

The company, known for such household brands as Tide detergent and Pampers diapers, faces veteran cosmetics makers such as L'Oreal SA, Avon Products Inc. and Estee Lauder; consumer products competitors led by Unilever NA who also are expanding beauty product lines such as Dove; and a growing number of niche players with specialty products that catch people's attention.

"I think overall, it's a positive outlook, but it's going to be more challenging," said Karen Grant, beauty industry analyst for the NPD Group. "There are more people playing; competition is stiffer."

"A lot of the things that make it an attractive growth business to us, others see, too," said Bruce Brown, a P&G vice president for research and development.

Paris-based L'Oreal has steadily increased spending on research, and has some 3,000 people in that part of the operations, said Patricia Pineau, the company's director of research communications.

"If you want to be a leader and compete, you need to anticipate the consumer expectations ... and what is going to be possible in 10 (and) 12 years," Pineau said.

For many of P&G's new beauty products, a journey of what can take from five to 10 years to reach store shelves begins at the Miami Valley Innovation Center near the Great Miami River, miles outside P&G's Cincinnati headquarters.

"There is nothing farther upstream at P&G than us," said James Thompson, associate director of P&G's global biotechnology division.

Dawson just spent nearly seven years there studying the genetic code of fungus that causes human dandruff.