Cosmetic Cosmetic Industries in Industries in

India India

Prepared by:Prepared by:anam khursheedanam khursheed

Bba – 3 (a)Bba – 3 (a)

INTRODUCTIONINTRODUCTION cosmetics: are substances used to cosmetics: are substances used to

enhance or protect the appearance or enhance or protect the appearance or odor of the human body. A subset of odor of the human body. A subset of cosmetics is called "make-up", which cosmetics is called "make-up", which refers primarily to colored products refers primarily to colored products intended to alter the user’s appearanceintended to alter the user’s appearance. .

The U.S. FDA defines cosmetics as: The U.S. FDA defines cosmetics as: "intended to be applied to the human "intended to be applied to the human body for cleansing, beautifying, body for cleansing, beautifying, promoting attractiveness, or altering the promoting attractiveness, or altering the appearance without affecting the body's appearance without affecting the body's structure or functions."structure or functions."

Cosmetic Preparations Cosmetic Preparations

Makeup Ingredients:

Plant LifeBarkLeaves

Food ItemsNutsHerbsBerries

Other ItemsMineralsInsects

Cosmetics were made for personal use and religious ceremonies. Historical records show that many different materials were used for body adornment.

SEGMENT-WISE BREAK UP OF SEGMENT-WISE BREAK UP OF THE FMCG SECTOR IN INDIATHE FMCG SECTOR IN INDIA

SEGMENSEGMENTT

PRODUCTSPRODUCTS MAJOR PLAYERMAJOR PLAYER

HOUSEHOLD HOUSEHOLD

CARECAREFabric wash; Fabric wash; household cleaners household cleaners (dish/utensil (dish/utensil cleaners,floor cleaners,floor cleaners,air cleaners,air fresheners,insecticidefresheners,insecticides and mosquito s and mosquito repellents,metal repellents,metal polish and furniture polish and furniture polish).polish).

HUL,Nirma,Godrej HUL,Nirma,Godrej Consumer Consumer products,ITC,P&G,Daproducts,ITC,P&G,DaburReckett & burReckett &

Coleman.Coleman.

PERSONAL PERSONAL CARECARE

Oral care, Hair Oral care, Hair care,Skin care,Skin care,Personal wash care,Personal wash (soaps),cosmetics & (soaps),cosmetics & toiletries,deodorants,ptoiletries,deodorants,perfumes, female erfumes, female hygiene products.hygiene products.

, , Godrej Consumer Godrej Consumer produColgate produColgate Palmolive,HUL, Palmolive,HUL, Amway,L’Oreal,LakmAmway,L’Oreal,Lakme,Marico,Cavin e,Marico,Cavin Care,Fem Care,Fem Care,Emami,P&G,HiCare,Emami,P&G,Hi

malaya,ITCctsmalaya,ITCcts..

SEGMENTSEGMENT

PRODUCTSPRODUCTS MAJOR MAJOR PLAYERSPLAYERS

FOOD FOOD &BEVERAGE&BEVERAGE

SS

FOOD : Staples, cereals, FOOD : Staples, cereals, bakery products bakery products (biscuits, breads,(biscuits, breads,

cakes, snack foods, cakes, snack foods, chocolates, icecreams,chocolates, icecreams,

branded flour, branded branded flour, branded rice, ready-to-eat rice, ready-to-eat

packaged foods etc.packaged foods etc.

Parle Agro, Brittania, Parle Agro, Brittania, Nestle, Cadbury, Nestle, Cadbury,

Pepsi Co., CocaCola Pepsi Co., CocaCola etc.etc.

BEVERAGE : Health BEVERAGE : Health beverages,Tea,Coffee,Botbeverages,Tea,Coffee,Bottled Water,Juices,Liquor tled Water,Juices,Liquor

etc.etc.

United United Breweries,GlaxoSmitBreweries,GlaxoSmit

hh

Kline,PEPSICO,Coca Kline,PEPSICO,Coca Cola,Radico,Dabur,ReCola,Radico,Dabur,Re

al etc al etc

INDIAN MARKET FOR INDIAN MARKET FOR PERSONAL CARE PRODUCTSPERSONAL CARE PRODUCTS

PROJECTED GROWTHPROJECTED GROWTH

Subject to sustained overall GDP Subject to sustained overall GDP growth rates of ~8-9% p.a., the growth rates of ~8-9% p.a., the overall Indian personal care market overall Indian personal care market has the potential to grow at 15%-has the potential to grow at 15%-16% p.a. (much higher rates for 16% p.a. (much higher rates for select segments like colour select segments like colour cosmetics, skin care and deodorants) cosmetics, skin care and deodorants) and thereby double to ~$8-bn by and thereby double to ~$8-bn by 2012-13.2012-13.

REASONS FOR GROWTH IN THE REASONS FOR GROWTH IN THE SKIN CARE INDUSTRY IN INDIASKIN CARE INDUSTRY IN INDIA Concerns about hygiene and personal Concerns about hygiene and personal

grooming drive sales.grooming drive sales. Discounts boost growth in the face of Discounts boost growth in the face of

economic uncertainty.economic uncertainty. Domestic players expand their Domestic players expand their

presence.presence. Chained retailers create opportunities Chained retailers create opportunities

for point-of-sale marketing.for point-of-sale marketing. Rising affluence and sophistication to Rising affluence and sophistication to

drive future growth.drive future growth.

About the Cosmetic IndustryAbout the Cosmetic Industry The cosmetic industry is a profitable business for most The cosmetic industry is a profitable business for most

of the manufacturers of cosmetic products.of the manufacturers of cosmetic products. cosmetic industry worldwide seems cosmetic industry worldwide seems to be continuously to be continuously

developing, now more than ever with the advent of the internet companies.developing, now more than ever with the advent of the internet companies.

Many famous companies sell their cosmetic products Many famous companies sell their cosmetic products online also in countries in which they do not have online also in countries in which they do not have representatives. representatives.

The cosmetic industry is a profitable business for most of The cosmetic industry is a profitable business for most of the manufacturers of cosmetic products.the manufacturers of cosmetic products.

Given the technological development and the Given the technological development and the improvement of the manufacturing process of cosmetics improvement of the manufacturing process of cosmetics and not least due to the constantly increasing demand of and not least due to the constantly increasing demand of such products, this industry reported an important growth such products, this industry reported an important growth in terms of profit.in terms of profit.

The art of cosmetics can be traced The art of cosmetics can be traced back to prehistoric timesback to prehistoric times..

Greekscalled it “Kosmetikos,” which means skilled in adornment.

Egyptians Drawings by ancient Egyptians show face and body decoration.

RomansRoman culture further refined the art of make-up.

India becoming more image conscious India becoming more image conscious

The reason behind this growth is down to as people becoming The reason behind this growth is down to as people becoming more beauty conscious in India, due to changing lifestyles and more beauty conscious in India, due to changing lifestyles and increasing consumer awareness. increasing consumer awareness.

This has given market players lucrative opportunities due to This has given market players lucrative opportunities due to increased awareness about personal care and the influence of increased awareness about personal care and the influence of western culture, which will also drive further growth in the western culture, which will also drive further growth in the cosmetic market, alongside the increase in disposable income cosmetic market, alongside the increase in disposable income of middle class families.of middle class families.. . The “Indian Cosmetic Sector Analysis” also provides an The “Indian Cosmetic Sector Analysis” also provides an insight into key trends and behaviour in the industry. insight into key trends and behaviour in the industry.

The report takes a look in depth at the Indian cosmetics The report takes a look in depth at the Indian cosmetics market, focusing on areas such as skin care, hair care, color market, focusing on areas such as skin care, hair care, color cosmetic, fragrances and oral care. cosmetic, fragrances and oral care.

Indian Cosmetic Sector Analysis Indian Cosmetic Sector Analysis (2009-2012)(2009-2012)

Indian Indian cosmetics industry has witnessed strong has witnessed strong growth during the past few years and has growth during the past few years and has emerged as one of the industries holding emerged as one of the industries holding immense future growth potential. The immense future growth potential. The cosmetics industry registered impressive sales registered impressive sales worth Rs 422.3 Billion (US$ 9.3 Billion) in 2010. worth Rs 422.3 Billion (US$ 9.3 Billion) in 2010. The sector has mainly been driven by improving The sector has mainly been driven by improving purchasing power and rising fashion purchasing power and rising fashion consciousness of the Indian population. consciousness of the Indian population. Moreover, the industry players are readily Moreover, the industry players are readily spending on the promotional activities to spending on the promotional activities to increase consumer awareness.increase consumer awareness.

New research report incorporates an extensive research and New research report incorporates an extensive research and rational analysis of the cosmetics industry in India. It provides rational analysis of the cosmetics industry in India. It provides segment level analysis of the industry along with the emerging segment level analysis of the industry along with the emerging trends that may shape up with the betterment of economic trends that may shape up with the betterment of economic conditions. The research will help consultants, industry analysts, conditions. The research will help consultants, industry analysts, and vendors to get in-depth knowledge of the current, past, and and vendors to get in-depth knowledge of the current, past, and future performance of the industry. The report also provides future performance of the industry. The report also provides information regarding consumer behavior, particularly men and information regarding consumer behavior, particularly men and rural population, with regard to rural population, with regard to cosmetic products

According to our new research report “Indian Cosmetic Sector According to our new research report “Indian Cosmetic Sector Analysis (2009-2012)”, Indian cosmetics sector is expected to Analysis (2009-2012)”, Indian cosmetics sector is expected to witness noteworthy growth rate in near future, owing to the witness noteworthy growth rate in near future, owing to the rising rising beauty concerns of both men and women. The industry of both men and women. The industry holds promising growth prospects for both existing and new holds promising growth prospects for both existing and new players. To support this evidence, we have done an extensive players. To support this evidence, we have done an extensive analysis of various segments of the cosmetics industry, keeping analysis of various segments of the cosmetics industry, keeping in view both the services and products sector.in view both the services and products sector.

we have also added the competitive landscape we have also added the competitive landscape section that incorporate valuable information section that incorporate valuable information about the leading cosmetic players, their about the leading cosmetic players, their marketing strategies, and swot analysismarketing strategies, and swot analysis

Swot analysisSwot analysis

StrengthStrength    During the three decades, from 1970 to 1990, the cosmetics During the three decades, from 1970 to 1990, the cosmetics

industry gained momentum in its extensive development through industry gained momentum in its extensive development through per capita consumption.  Even some segments may vary; the per capita consumption.  Even some segments may vary; the cosmetic industry is near maturity.  The current annual retail cosmetic industry is near maturity.  The current annual retail sales of the industry totaled up to $14.5 billion.  sales of the industry totaled up to $14.5 billion.              The first quarter of this current year has seen a demand             The first quarter of this current year has seen a demand beginning to revivbeginning to revive e aa nd trend is expected to continue well into nd trend is expected to continue well into the following yearthe following year

.. Weaknesses Weaknesses       Accounting to the past developments, the cosmetics industry Accounting to the past developments, the cosmetics industry

has never been always in such a case.  The industry is no longer has never been always in such a case.  The industry is no longer recession-proof and is now bound for depressions and recession-proof and is now bound for depressions and declinations.  Actually, the sales in the past year are slow moving declinations.  Actually, the sales in the past year are slow moving because of downed consumer spending.  Consumers that time because of downed consumer spending.  Consumers that time then tend to settle for the less expensive lines.  then tend to settle for the less expensive lines.              Another setback of the industry is the demand-price ratio.              Another setback of the industry is the demand-price ratio.  Within the past five years, the prices were invariable and steady Within the past five years, the prices were invariable and steady but promotion budgets were growing and getting greater than but promotion budgets were growing and getting greater than ever.  ever. 

OpportunitiesOpportunities In keeping away from a potential head-on competition, a In keeping away from a potential head-on competition, a

strategy of focusing on special niches proved to be strategy of focusing on special niches proved to be effective especially in the struggle with the industry effective especially in the struggle with the industry leaders.  This has been a great line of attack adopted by leaders.  This has been a great line of attack adopted by smaller companies in their contest with the market smaller companies in their contest with the market leaders.  They survive and exist through specializing in leaders.  They survive and exist through specializing in niches, differentiating the product lines, and focusing on niches, differentiating the product lines, and focusing on market segment.  market segment. 

                        A potential huge market has been spotted on men A potential huge market has been spotted on men as they account for 50% of adult population that as they account for 50% of adult population that consume one-fifth of cosmetic sales.  The failure of the consume one-fifth of cosmetic sales.  The failure of the market leaders in such opportunity provides hint to market leaders in such opportunity provides hint to smaller companies as to what would be the proper and smaller companies as to what would be the proper and better approach to the market.  better approach to the market. 

                        Furthermore, the senior citizen population is a Furthermore, the senior citizen population is a large growing market segment which should be given large growing market segment which should be given focus as the population’s needs were not being met.  focus as the population’s needs were not being met. 

ThreatsThreats

  Notwithstanding the apparent growth of the Notwithstanding the apparent growth of the cosmetic industry during the past four cosmetic industry during the past four decades, there are currently more than 700 decades, there are currently more than 700 growing cosmetic companies competing in growing cosmetic companies competing in the market.  Additionally, there are also the market.  Additionally, there are also market leaders that dominate the cosmetic market leaders that dominate the cosmetic industry.  Consequently, it creates stiff and industry.  Consequently, it creates stiff and intensifying competition especially to those intensifying competition especially to those smaller companies as market leaders are smaller companies as market leaders are putting pressure on these smaller cosmetic putting pressure on these smaller cosmetic companies.  companies. 

MAJOR PLAYERS MAJOR PLAYERS of cosmetic of cosmetic industryindustry

Market share (%) Market share (%) of skin care companiesof skin care companies(basis retail value rsp. ’09)(basis retail value rsp. ’09)

12.0%

3.4%

3.9%

21.8%

53.0%3.4%

2.5%

Hindustan Unilever CavinKare

Godrej Emami

Revlon L'Oreal

Others

HULCavin Care

HINDUSTAN UNILEVER Ltd.HINDUSTAN UNILEVER Ltd. Hindustan Unilever Limited (HUL) is India's Hindustan Unilever Limited (HUL) is India's

largest Fast Moving Consumer Goods largest Fast Moving Consumer Goods Company, with over 20 distinct categories in Company, with over 20 distinct categories in Home & Personal Care Products and Foods Home & Personal Care Products and Foods & Beverages& Beverages..

The company’s Turnover is Rs. 17,523 crores The company’s Turnover is Rs. 17,523 crores

(for the financial year 2009 - 2010).(for the financial year 2009 - 2010).

Major skin care products are: Major skin care products are: >> Fair and Lovely, Lakme, Pond’s and Vaseline Fair and Lovely, Lakme, Pond’s and Vaseline >> Breeze, Dove, Hamam, Lifebuoy, Liril, Lux, Breeze, Dove, Hamam, Lifebuoy, Liril, Lux,

Rexona and Pears.Rexona and Pears.

CAVINKARE LTDCAVINKARE LTD.. In 1983 with a single product, CavinKare In 1983 with a single product, CavinKare

started out as a small partnership firm. The started out as a small partnership firm. The Company that began its journey as Chik Company that began its journey as Chik India Ltd was renamed as CavinKare Pvt. India Ltd was renamed as CavinKare Pvt. Ltd (CKPL) in 1998Ltd (CKPL) in 1998. .

Smart marketing and clear product Smart marketing and clear product positioning not only ensured CavinKare's positioning not only ensured CavinKare's growth but also helped the company growth but also helped the company broaden its product portfolio extensively. broaden its product portfolio extensively.

Major skin care products-Major skin care products->> Fairever, Fairever Fruit, Spinz Talc, Spinz Fairever, Fairever Fruit, Spinz Talc, Spinz

Deodrants,Hi5 Deodrant and Nyle Cold Deodrants,Hi5 Deodrant and Nyle Cold Cream and Lotion.Cream and Lotion.

GODREJ CONSUMER PRODUCTSGODREJ CONSUMER PRODUCTS Godrej Consumer Products (GCPL) is a Godrej Consumer Products (GCPL) is a

leader among India's Fast Moving leader among India's Fast Moving Consumer Goods companies, with Consumer Goods companies, with Personal and Home Care Products. Personal and Home Care Products.

GCPL is driven by the mission to GCPL is driven by the mission to continuously enhance the quality of life of continuously enhance the quality of life of consumers in high-growth markets with consumers in high-growth markets with its products.its products.

Major skin care products are :Major skin care products are :

>> Fair Glow, Cinthol (soaps, deodorants and Fair Glow, Cinthol (soaps, deodorants and talcum powder),Vigil & Godrej No.1.talcum powder),Vigil & Godrej No.1.

EMAMI LIMITEDEMAMI LIMITED

Emami Limited is a coveted Rs 1000 crore Emami Limited is a coveted Rs 1000 crore business entity, a leading player in the business entity, a leading player in the personal and healthcare consumer personal and healthcare consumer products industry in India engaged in products industry in India engaged in manufacturing and marketing of health, manufacturing and marketing of health, beauty and personal care products that are beauty and personal care products that are based entirely on ayurvedic formulation. based entirely on ayurvedic formulation.

Major skin care products of the company Major skin care products of the company are as follows :are as follows :

>> Boroplus antiseptic cream, Boroplus prickly Boroplus antiseptic cream, Boroplus prickly heat powder, Fair & Handsome, Malai heat powder, Fair & Handsome, Malai Kesar Cold Cream & Navratna cool talc.Kesar Cold Cream & Navratna cool talc.

CONCLUSIONCONCLUSION Multinational players with international brands Multinational players with international brands

have a strong presence in the Indian personal have a strong presence in the Indian personal care segment. care segment.

Local brands too are gaining a foot-holding the Local brands too are gaining a foot-holding the market by innovatively developing value offerings market by innovatively developing value offerings to meet the unique needs of the Indian consumer. to meet the unique needs of the Indian consumer.

Going ahead, it will be important to develop R&D Going ahead, it will be important to develop R&D capabilities to further customize products for capabilities to further customize products for Indian consumers, create greater awareness Indian consumers, create greater awareness among the burgeoning middle class and ensure among the burgeoning middle class and ensure effective distribution reach to service them. effective distribution reach to service them.

The companies that are able to develop a The companies that are able to develop a judicious mix of the above will be the eventual judicious mix of the above will be the eventual winners.winners.

The time is ripe to review one’s strategy and come The time is ripe to review one’s strategy and come up with innovative approaches to help realize the up with innovative approaches to help realize the full potential of the Indian skin care sector.full potential of the Indian skin care sector.

Thank you!

Thank you!