Most Popular in:


Email This Item! Print This Item!

Brazil’s Beauty Sales Grow 14.75% in 2009

By: Fernanda Bonifacio
Posted: April 6, 2010, from the April 2010 issue of GCI Magazine.

O Boticário new distribution center near São Paulo, which will double the company’s distribution capacity, was prompted by the company’s 20% growth rate in 2009.

page 2 of 5

The low consumption compared to other markets can be explained by the fairly recent entry of the company in Brazil in the late 1980s. P&G’s biggest rival, Unilever, has maintained a far more significant presence since 1930. Nevertheless, Brazil figures among P&G’s 15 largest markets, and the potential for the company in the Brazilian market is recognized by the company’s executives. “Our position oscillates between the 11th and 14th place due to exchange rate variations,” said Tarek Farahat, chairman, P&G in Brazil.

Approximately 80% of the company’s sales in the country are produced in P&G’s factories in São Paulo, Amazonas and Rio de Janeiro. Brazilians’ growing interest in beauty products has encouraged Farahat to create new strategies for competing. “Even during hard economic periods, nobody quit bathing or brushing their teeth. Brazilians love to purchase products,” he said.

In the oral care segment, for example, the introduction of alcohol-free mouthwash Oral-B Pro-Health in 2009 demonstrated the sales potential. It is estimated to have already snapped up 10% of the market in northeast Brazil. An Olay skin care launch is also eagerly awaited, and even without official confirmation, there are rumors that acceptance research is already being conducted in Brazil.

High Fragrances Sales Intensify Retail Competition; E-commerce

The perfume industry is working to bring its exponential growth in recent years to the attention of retailers. In 2008, Brazil gained a 60.3% market share of fine fragrances in Latin America. According to research by Givaudan, sales of perfumes and fragrances in Brazil are expected to reach $ 11.3 billion in 2012, reaching a market share of 64.4%. Due to the strength of this market, increasing competition among perfumeries, drugstores and supermarket chains has created new alternatives for fragrance sales.

With six stores in São Paulo, for example, Opaque perfumery aims to accelerate its expansion. Its goal is to open two more outlets by mid-2010 and invest in overhauling its e-commerce site. But, according to its general director Sun Chul Kim, traditional perfumeries are declining numerically due to the relative expense of the stock. “The segment is seeking new channels like the Internet. Today, our Web site has about 50,000 users, but we want to quadruple that number in the next 12 months.”