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Bath & Body: Growing Beyond the Basics

By: Izaskun Bengoechea, Euromonitor International
Posted: October 7, 2008, from the October 2008 issue of GCI Magazine.

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Men are increasingly turning to these products as a fragrance and a supplement to standard perspiration fighting deodorants. The fragrance trend has also extended to the women’s category, with exotic scents such as Secret’s Jasmine Orient or Southern Peach. Finally, manufacturers have introduced improved formulations that promise to be more effective, less staining or gentler. All these initiatives have allowed manufacturers to charge more for a unit of deodorant, contributing to rising sector value.

Megabrands vs. Private Label

Procter & Gamble and Unilever together account for more than a third of total sales of bath and body products, according to Euromonitor International. The development of megabrands has made these companies particularly successful at a global level, with many of their leading bath and body brands being easily recognizable by consumers across the globe. P&G’s Gillette brand and Unilever’s Dove, Rexona and Axe/Lynx brands are successfully gaining share year-on-year.

Smaller local and niche operators posed no real trouble to leading manufacturers, but were able to post some impressive results in 2007. Turkish company Evyap Sabun Yag Gliserin Sanayii ve Ticaret AS saw a double digit increase in global sales, and the company ranked number one in bath and shower products in Turkey, ahead of Colgate-Palmolive and fourth overall. In China, Shanghai Jahwa United Co. ranks fourth, and has been successful with its emphasis on its Chinese heritage. In Brazil, Indústria Matarazzo de Óleos e Derivados ranks third, and the company also emphasizes its local roots to nurture a loyal consumer following

Private label is a growing presence within bath and body products. In developing countries, such as those in the Middle East, consumers are warming up to the idea that the local store’s private label is perhaps of the same quality of mainstream brands but at a fraction of the price. In developed regions, own label products have successfully matched trends shown by the leading brands and offer the same added value properties. Private label has proved itself to be in tune with new trends—such as organics and naturals—and, given the current economic downturn in the U.S. and Western Europe, consumers are likely to be increasingly attracted to lower-priced toiletries.

Reasonable Prospects and Room for the Brave

Bath and body products are expected to grow by 11% in constant value terms during 2007–2012, according to Euromonitor statistics. Asia-Pacific is the region to look out for, as Japan’s stagnating will be overshadowed by the exploding sales in China and India. Total sales of these two countries is expected to surpass that of Japan, currently the leading Asian economy. Growth for Asia-Pacific is forecast at 21% to 2012, and the region will overtake Western Europe as the most valuable global region for bath and body sales.