Euromonitor International, in partnership with In-cosmetics 2011, presented its latest predictions for the beauty at the March event—outlining the four strategies companies are following to succeed post-recession and providing the outlook for the next five years.
“The beauty and personal care industry registered 5% growth globally in 2010, mainly due to the strong performance of mass market products,” said Irina Barbalova, head of beauty and personal care, Euromonitor International.
And Euromonitor’s latest research indicates that mass cosmetics will have an even stronger presence globally by 2015, as the dominance of Latin America in the global beauty landscape increases. The rising penetration of private label, with more than $2 billion of sales in skin care in 2010, will help drive this trend.
Barbalova and Oru Mohiuddin, senior personal care company analyst, Euromonitor International, explained the four key strategies employed by global brand owners in the post-recession world:
Strengthening Their Presence in Emerging Markets
Companies have strengthened their emerging market expansion strategies in “frontier markets” such as South Africa, Egypt or Indonesia. They are strengthening their offering to the local consumer by localizing their R&D to create products more suited to regional preferences.
Offering Value for Money in Western Markets
With 55% of total revenue, Western markets remain important. However a more value conscious consumer has forced companies to add value to their mass ranges. Brand owners have included scientifically advanced technology to mass range products or acquired professional ranges to be distributed in the retail sector to make the most of that “value for money” feeling.
Engaging with Consumers in Western Markets Through New Media
Companies are exploring new opportunities to engage with consumers by increasing Internet and smart phone usage. Social networking, online retailing and consumer reviews are predicted to play an increasingly important role in shaping consumer trends in beauty.
Making Sustainability Part of Brand Communication
Intense competition and greater consumer awareness have put companies under pressure to increase their credentials as good corporate citizens. Brand owners are dedicating efforts to reduce waste, water consumption and gas emission—as well as improving sustainable sourcing, cooperating with ingredients suppliers and packagers to achieve better results.
For Euromonitor's annual “State of the Industry,” be sure to watch for the June issue (online and in print) of GCI