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State of the Industry

By: Carrie Lennard, Euromonitor International
Posted: June 7, 2011, from the June 2011 issue of GCI Magazine.

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Hair care sales rose by 5% in value terms in 2010, boosted by another strong year for shampoos as consumers in Brazil continue to drive the global hair care industry. Salon hair care continued to struggle as consumers stretched out time between visits to the hairdresser.

Of the smaller categories, consistently strong growth was seen in deodorants and baby care, which achieved value growth of 8% each in 2010, and men’s grooming, which registered a 7% increase for the year as sales of these products are increasing in the developing world. Deodorant sales are booming in emerging regions where their use is becoming incorporated into the daily hygiene regimens of consumers. Latin America, particularly Brazil, is driving global deodorant sales, with consumers in the region using scented body sprays as less expensive substitutes for more expensive fragrances.

Internet Retailing Makes Advances in Beauty

Non-store retail was the only channel to gain share in 2010. A strong performance from direct selling, particularly in Latin America and Asia, also had a role to play in this, but Internet retailing alone grew by 16% in 2010, adding a further $2 billion to its share of beauty and personal care sales.

Regional Outlook: Africa and Middle East to See Strong Growth

By 2015, most regions will see a return to pre-crisis growth rates, except Eastern Europe, which will put in a slightly weaker performance compared to the double-digit growth rates of the past.

Asia will be boosted by excellent growth in China, with more than $10 billion added to the size of its beauty industry by 2015. However, slower growth is expected in Japan, which still accounts for nearly half of Asia’s sales, with the market not expected to recover by 2015. Latin America will be the main growth driver of the global beauty industry, with the region set to add more than $18 billion to its value size by 2015. Africa and the Middle East are also set to witness strong growth, although this will still be from a very low base. Growth in the region will be fairly concentrated on just a few markets—primarily South Africa and Saudi Arabia.

Skin Care to Continue Dominance