India – a market divided

Published: 10-Nov-2011

India’s beauty market is dividing into internationally recognised branded products for the middle classes and unknown brands at the poorer end of the spectrum. Growth areas include direct selling, skin lightening and natural claims. Meanwhile, India\'s big brand owners are extending their reach both at home and abroad.

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While India’s beauty market expands it is becoming increasingly complex and the competition is growing in all areas. Raghavendra Verma reports from New Delhi

While India’s soaps and cosmetics manufacturers are currently reaping the benefits of a rapidly expanding domestic market, they are at the same time bracing themselves for the challenges of dealing with increased competition and a more complex segmented marketplace.

“Competitive pressures will be on the rise as newer entrants seek a slice of India’s long-term growth potential,” says Harish Manwani, chairman of Hindustan Unilever Ltd, India’s largest, fast moving consumer goods company, in its latest annual report.

US-based company Jafra Cosmetics is just one of the latest international entrants into the Indian market, teaming up with a local partner Ruchi. “Hotel, airlines and other service industries, where both men and women pay extra attention to their grooming, are growing at a phenomenal rate. This has led to a very high rate of growth in skin care products and colour cosmetics,” says Johan Wicklund, joint managing director of Jafra Ruchi Cosmetics in India.

Catering to this demand, Hindustan Unilever recently launched a high performance make-up range called Lakmé Absolute, which it claims has effects lasting up to 16 hours. Along with the company’s other new launches – such as Lakmé’s ‘Perfect Radiance’ multi-mineral skin lightening compact; Sure anti-perspirant deodorant; and Fair & Lovely’s anti-marks eraser pen (for skin with pimples) – Hindustan Unilever’s personal products business grew by 15.7% in the financial year ending March 2011.

According to Nemichand Jain, chairman of All India Small Scale Cosmetic Manufacturers Association, Indians are currently spending more on cosmetics than they are on garments and jewellery.

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