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Cosmetics Retailing in India: Obvious Excitement

By: Priyanka Bhattacharya
Posted: February 20, 2007, from the February 2007 issue of GCI Magazine.

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According to industry experts, 2005 and 2006 were the years of color and skin care for the market, when most leading players either entered directly or through distributors, or repositioned their marketing strategy to meet the demands. There has been an international entry at every consumer segment, but, surprisingly, the high-end cosmetic retail segment saw maximum activity.

In the premium segment, Chanel was a prime mover, entering the market in 2005 directly through a subsidiary instead of a distributor. Similarly, Estée Lauder set up its India office and brought in MAC Cosmetics for the professional and serious makeup users. Brands such as Givenchy and Versace set their sights on the Indian market through distributors. L’Oréal Luxury Division was launched in the country in January 2006. The company has started marketing Ralph Lauren and Cacharel brands.

Cooper said L’Oréal’s Luxury Division entered India this year after a long research phase and upon seeing a satisfactory level of consumer awareness. It is still working out the right retail strategy to make an impact and bring in its other brands including Lancôme, Shu Uemera, and Biotherm. Meanwhile, distributors for brands like YSL Beaute, Shiseido, Kenzo, Elizabeth Arden and Clarins developed unique promotional events to refresh the brands image among the target consumer segments.

In the high-end market, players such as MAX Factor, Body Shop, ArtDeco and Red Earth have set up shop in the country. But most of these companies have entered the market through leading distributors such as Baccarose, Quest Retail, MKP Distributors and AP Distributors, respectively.

During the launch of Body Shop’s store in Delhi, Dame Anita Roddick, company founder, said that while it entered India relatively late, its plans to have 50 stores in the next three years are ambitious.