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A recent report from research firm RNCOS shows that the Indian cosmetic sector is expected to post a compound annual growth rate of 18% 2011–2014. The growth has been attributed, in part, to Indian women’s increasing product awareness and beauty consciousness. However, male consumers are opening up to the need for grooming products made for men. Male consumers are travelling more than ever, and are being influenced by the grooming habits of their international counterparts. In response, many national and international beauty brands are launching products targeted at men.
In terms of growth opportunities, smaller towns are demonstrating their potential as big retailers open large format stores in the tier 2 and tier 3 cities and towns. There is a latent demand in those areas as exposure to beauty care through Internet drove demand prior to brick-and-mortar retail outlets. In rural areas where many Indian brands are exploring opportunities, low price, high quality and easy availability will be the key to growth.
The Body Shop Announces First-ever Brand Ambassador
The Body Shop announced its first-ever brand ambassador to promote its products in India. The company has appointed actress, and erstwhile beauty queen Dia Mirza as India brand ambassador. Her association with the brand was announced in conjunction with the launch of skin-whitening range Moisture White.
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According to David Smith, managing director, The Body Shop Asia-Pacific, this decision was made to push the brand to the next level of growth in the country, and India is a country where most brands work with celebrity brand ambassadors to improve the brand recall of the products. Following suit by having an Indian celebrity talk about the benefits of using the products, The Body Shop deemed the strategy important as it looks to strengthen its presence in the tier 2 and tier 3 cities where it is expanding its base.
Estella Lau, franchisee director, The Body Shop Asia-Pacific, indicated that the company decided to partner with Mirza (who is not the best-known actress in India) because, in addition to her natural beauty, she is actively involved in many community activities. Lau and Smith both stressed that Mirza embodies The Body Shop’s ethical values. The company will work with Mirza on strategic advertising and promotional activities for a wide range of skin care products in the coming months.
HUL’s Former Chairman Joins Marks and Spencer’s Board
Manvinder Banga, former chairman of Hindustan Unilever, has been appointed as a non-executive director on the board of UK-based global retailer Marks and Spencer Group Plc. He joins the board in September. Banga spent 33 years at Unilever as the president of global foods, home and personal care businesses, and was also an executive member of the board.
According to Marks and Spencer (M&S) chairman Robert Swannell, Banga’s experience in personal care and retail will support M&S becoming an international multichannel retailer. Industry watchers also see this as a move to establish the M&S brand in India, where the company currently has a 51:49 joint venture with Reliance Retail. Even though M&S has been in India for the past nine years, operating approximately 20 stores across the country, the brand hasn’t been able to establish its presence as strongly as it was first envisioned.
Axe Deo; Other “Obscene” Ads Axed From TV
The advertising content control board in India, Advertising Standards Council of India (ASCI), is unhappy at the explicit content and sexual tone of the Axe deodorant commercial aired in summer 2011. ASCI sent notice to Hindustan Unilever, the company that owns the brand, to take the commercials off air, to which HUL agreed. Meanwhile, ASCI also sent similar notices to two other men’s deodorant brands, Set Wet Style and Zatak, because the TV spots were deemed to be “indecent” and “obscene.” ASCI undertook the action upon a directive from the Ministry of Information and Broadcasting after the ministry had received complaints from viewers.
Henkel Posts Profit After Takeover
Since its takeover by Jyothi Laboratories, Henkel India will, according to the company’s CEO, post a net profit by the end of September 2011. Jyothi Lab, which bought the money-losing Indian unit of Henkel AG, expects to save 10% of Henkel India’s revenue over the next year due to cost reduction measures and new business strategies. The company also plans to increase the product pricing by 5%. The beauty brand currently sold by Henkel India is Fa.
Jyothi nearly halved the manpower at Henkel from 450 to 250, and Jyothi has already identified a professional chief executive, and will hire new brand managers and category heads as part of the new management structure.
Additionally, Jyothi Labs also plans to get into the retail hair care market with a new product portfolio from Henkel Germany. The company did not buy the Henkel-owned professional hair care brand Schwarzkopf in India; that was absorbed by Henkel Adhesives, which is working on new business strategies to popularize the Geran professional hair care brand in India.
Priyanka Bhattacharya is a writer and journalist covering the beauty, health and wellness industries in India. She is the contributing beauty features writer for several leading Indian women’s magazines.