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Multinationals Target Brazil’s Beauty Industry for Growth Despite Drop
By: Fernanda Bonifacio
Posted: June 25, 2014, from the July 2014 issue of GCI Magazine.
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In 2013, the non-medicines category, which includes cosmetics, toiletries and dietary supplements, also recorded the highest increase (+19.17%) compared to (+11.44%) for medicines, with a 32.51% share of total sales.
MWV to Invest R$100 million in Brazil by 2020
The MeadWestvaco Corporation (MWV) announced an investment of R$100 million in Brazil by 2020, with most resources directed toward the manufacturing of dispensing valves and sprays for the fragrance industry. The company anticipates the investment to triple its market share in Brazil from 10% to 30%.
Of the move, Eduardo Scalese, business director of MWV Home, Health & Beauty in Brazil, said, "Brazil is the fastest growing of all subsidiaries in the cosmetic and toiletries industry.”
Earlier in 2014, MWV increased its production capacity from 30 million to 80 million valves per year. In 2013, MWV’s cosmetic division grossed US$5.2 billion, which accounted for 14% of global business. In Brazil, this segment represented 4% of sales, which totaled US$600 million.
O Boticário Becomes Brazilian Fragrance Leader
The most well-loved brand among Brazilian consumers, as per a survey carried out by Centro de Inteligência Padrão, O Boticário also has become the leading fragrance brand in Brazil, leaving Natura in second place.
According to data from Euromonitor, O Boticário accounted for 28.8% of fragrance sales in 2013 (+10%), while Natura held 27.7% of the market share. According to the ABF (Brazilian Franchising Association), O Boticário also has secured its position as the largest franchise network in the country, having surpassed McDonald’s and supermarket chain Dia.
However, despite a 6% drop in net profits in the first quarter of 2014 due to increased expenditures with the depreciation of the company and the offsetting of expenses, Natura remains strong in the market and forecasts investments of R$500 million in 2014. One of the most valuable retail brands in Latin America, Natura continues to be one of the only Brazilian companies among the world’s most valuable beauty brands.
Fernanda Bonifacio is a Brazilian journalist who focuses on the beauty industry, and has been published in the U.S. and Europe. She represented ABIHPEC and its member companies globally from 2002–2008. She has also been a communications consultant for raw material manufacturer Beraca since 2009.