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Marketing Matters: Values Shape Purchasing Styles

By: Liz Grubow
Posted: March 5, 2007, from the March 2007 issue of GCI Magazine.

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Natura Cosméticos, a direct sales company that began in Brazil in 1969, also offers a host of options for bath and body care. Its Ekos line features hydrating body oils, perfumed body moisturizers, face and body cleansing foam, glycerin soap and cream liquid soap. Most of these products feature extracts of plants and vegetables native to Brazil. Although upscale retailers such as Sephora and Ulta are limited to larger Brazilian cities—São Paulo and Rio de Janeiro, for example—specialty retailers stocking salon-quality hair products and imported bath and body products are popular for consumers with disposable income.

Bar soap still holds a grip on the bath and body categories in Latin America. Phebo, a Brazilian glycerine soap once owned by P&G, remains popular because of its variety of luxurious scents. Lux, one of the darlings of the Unilever line since 1924, also sells well, although it tends to have a higher price point than Phebo. Palmolive, primarily a dishwashing and liquid hand soap (SoftSoap) brand in the U.S., has a stake in the bar soap and body wash categories in Latin America, while Zest and Camay are top sellers in Mexico. Due to the high humidity in Latin America, scent and odor control are major factors influencing the choice of body wash and bar soap products; consumers tend to have more options in choosing a fragranced bath and body product than do their U.S. counterparts.

New Kids on the Block

 “We see Brazil’s market growing for more trendy glamour brands like MAC and Estée Lauder,” said Rogério Chain, country manager for Brazil, Estée Lauder. “That’s not just because Brazilian women are considered to be more vain and beauty-conscious than most, but also because of a growing economy. The GDP is expected to rise 3.6% in 2006. We see Brazil the way we see China, India and Russia, as one of the new kids on the block.”

Supporting the claim, Women’s Wear Daily reported 2005 sales of beauty products in Brazil were at $6.3 billion, an increase of 14% over 2004.

Generally, these consumers tend to value interpersonal relationships when selecting products, which might account for the success of direct sales companies such as Avon, with a current sales force of one million consultants in Brazil alone, and Natura, which is gaining market share. However, the U.S. consumer trend of buying in bulk, in warehouse-like retail outlets such as Costco and Sam’s Club, has not extended to Latin America. These consumers tend to buy only what they know they will use. As a result, packages tend to be smaller (200 mL of shampoo vs. 500 mL in the U.S.), and body care products such as razors are purchased individually or in packages of three, not 10.