The Great Global Beauty Race: How the Top 20 Companies finished the fiscal year.

Developing markets, top management tweaks and a focus on megabrands took many of our Top 20 through a tough 2010 and on into the next decade. While many experienced a healthy sprint on the way to acquiring massive numbers of new consumers, phrases similar to “despite enormously challenging conditions” prefaced many of the corporate leaders’ remarks on results for 2010.

This year’s Top 4 companies remain the same as in previous years’ standings, with P&G claiming the No. 1 spot once again, in part due to its inclusion of razors in its beauty segment and a realignment of its Global Business Units. The consumer products giant has also ramped up its prestige business in its nearly neck-and-neck race with L’Oréal, while facing Unilever’s strong competition on the mass-market side. Estée Lauder, which remains steady in fourth place, reported a great year, gaining prestige ground around the world.

As the race to gain consumers continues, new markets, via developing regions, remain key to brand expansion. There’s a distinct split emerging to target these vast populations. Mass market and direct sales in India rose due to sachet-sized personal care products, bar soaps and other necessaries. On the other hand, China’s growing demand for prestige products boosted sales for many of our Top 20.

In fact, China became L’Oréal’s third largest market worldwide. CEO Jean-Paul Agon declared that the economic crisis was over, and looking ahead, commented: “In 2011, for the first time, the New Markets may be the group’s number-one zone for sales.”

To deal with the global shift, many of our Top 20 brought in new management to lead the way. Key executives dropped out—or stepped in—at P&G, L’Oréal, Unilever, Estée Lauder, Shiseido, Avon, Beiersdorf, The Limited and Alticor.

Product ranges were also added—or cut—as brand manufacturers culled out their favorites and focused on what they define as megabrands.

R&D and innovation also remain top of mind in the great global beauty race. Several LEED-certified research facilities have opened in China, where scientists are working on solutions specifically geared to the needs of the local population. R&D obviously pays off when a truly new product or delivery system is revealed. Such was the great success story with foam hair color, which kept several companies in the running in an otherwise tough year.

And as celebrity endorsement power continues to grow by leaps and bounds, the trend has taken off throughout the world—and it seems as if everyone wants to recruit J.Lo.

Just a note on the compilation of this report: Companies were analyzed according to 2010 data (except as noted). Beauty sales included only cosmetics, fragrance and personal care items when possible. Figures for companies outside the U.S. were based on the exchange rate for the fiscal year on the day it ended.