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Bath and Shower: No Longer a Drain

By: Briony Davies
Posted: March 5, 2007, from the March 2007 issue of GCI Magazine.

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With global sales of $23.3 billion in 2005 and growth of almost 6% on the previous year, bath and shower appears to be picking up the pace and taking advantage of the opportunities in emerging markets. In developed markets, where competition is toughest, manufacturers are innovating to drive value sales and find a unique selling point that will give their brands an edge.

Rising Sophistication: Latin America and Eastern Europe

In 2005, bath and shower products saw rapid expansion in Latin America, albeit from a small base and accounting for less than 11% of total global value sales. By 2010, the region is expected to experience value growth of 15%, a slight comedown from the 2001–2005 period (17%) but nonetheless dynamic. Bar soap has commonly been the main driver of sales—accounting for almost 85% of sector value in 2005, a 17% growth, and outselling value-added liquid soap and body wash varieties—but this is beginning to change. As in other developed markets, the most dynamic area for Latin America in 2005 was body wash/shower gel with 26% growth, reflecting the increasing popularity of the format perceived as more convenient and luxurious among affluent urban consumers.

Eastern Europe represents strong growth prospects in the bath and shower products sector, as economic conditions across the region improve and the market consistently returns dynamic year-on-year value sales. Eastern Europe is also showing real signs of sophistication, and consumers have proved to be willing to pay more for luxury items such as bath additives and value-added shower gels. Staple bar soap, as well, continues to expand in value terms—with products such as Dove’s array of “one quarter moisturizing cream” products offering more for slightly higher unit prices.

Russia, Ukraine and Poland are the largest markets in the region, accounting for 29%, 23% and 15% of value sales, respectively, in 2005. In Russia and Ukraine, recent years were marked by the growing availability and popularity of more sophisticated bath and shower products such as bubbling bath salts, sparkling tablets, at-home spa sets and products made from natural ingredients.
Consumers in the region increasingly strive for the same luxury products enjoyed by their Western counterparts—due, in part, to their increased exposure to Western advertising and media imagery. In Poland, the Czech Republic and Hungary, bar soap is still considered a household staple, but value growth in bar soap has suffered from value-added product and liquid format sales.

Two-tiered Market: Asia-Pacific