Brazil’s CT&F Market Staying Ahead of the Global Beauty Curve
Brazil, a country that covers 3.2 million sq mi of land and has over 21 thousand sq mi of water currently holds the position as the third highest ranking country in the world’s Cosmetics Toiletry, and Fragrance (CT&F) market according to the 2013 Euromonitor. Brazil’s beauty industry growth rate, between 1996 and 2013 reports prove an average growth rate of almost 10% according to The Brazilian Association of the Cosmetic, Toiletry and Fragrance Industry (ABIHPEC) studies. Net factory sales confirm an increase from R$ 4.9 billion in 1996 to R$ 38 billion in 2013. This goes to show that over the span of 18 years the Brazilian beauty market has shown a through the ceiling growth increase of R$ 33.1 billion!
Brazil’s ranking is soaring in the overall global CT&F market. A breakdown for each category level in comparison to other countries solidifies Brazil’s beauty market. GCI’s November 2014, magazine article Exploring Brazil with Philippe de Carvalho, GM for Brazil, Coty brand states that Brazil’s beauty market is projected to gain the number two global ranking spot in the near future, as the U.S. steadily maintains its first place rank.
In 2011 the Euromonitor’s research on Brazil’s market found cosmetics (make-up and nail care) to be the dominating category in the market’s overall product sales. Today, fragrance and deodorants are leading the beauty product sales category. In comparison to the U.S., Brazilians purchase three times as much fragrances with male consumers showing a prominent role in fragrance purchases. According to Exploring Brazil, the volume of fragrance purchased by men in Brazil is currently 48.7%. This indicates that male consumers are rapidly becoming a greater target to reach in the global fragrance market.
ABIHPEC reports Brazil’s beauty category top five rankings in the CT&F global market are listed as:
- 1st in fragrances and deodorants
- 2nd in hair care, men’s and kid’s products, bath care, depilatories, and sun care
- 3rd in color cosmetics (make-up and nail care)
- 4th in oral care
- 5th in skin care
Wondering what’s the driving force behind both Brazil’s CT&F market’s fiscal growth and consumer consumption rates?
The beauty industry is forward-thinking in its marketing methods and its ability to understand Brazil’s landscape is instrumental in locating consumers throughout the region. ABIHPEC’s research found that Brazil’s beauty consumers who are within the lower and middle class of Brazilian society, are gaining higher incomes due to rising job opportunities. This results in greater affordability of CT&F products for the beauty market. Greater affordability of beauty products in Brazil’s market also stems from technological advancements, leading to enhanced productivity, and benefitting CT&F pricing. Low CT&F pricing helps to maintain a low increase pace on the overall economy price index.
Another imperative point found in ABIHPEC’s research is the escalating number of women in Brazil’s employment sector. Women are increasingly becoming the leading controller of the household budget which provides opportunity for beauty product purchase rates to rise. Meeting the growing market needs through the continuance of new product releases, specifically premium products releases, is a strategic approach to capture the attention of Brazil’s beauty youth consumers. This 16 to 35 year old demographic totals to 100 million people. According to Exploring Brazil.
“We also see digital as a key channel through which to connect with the Brazilian market. Young consumers are keen on digital engagement with brands,” Philippe de Carvalho stated. He added that consumers are more “Likely to use mobile devices and engage with multiple screens at once”.
CT&F distribution channels are made of three leading divisions:
- Traditional wholesale and retail stores such as L’Oreal, P&G, J&J, and Unilever cater to higher income consumers.
- Direct Sales development of the at-home shopping concept, are utilized by power brands such as Avon and Natura Brasil. These brands have a massive footprint with over 3 million direct sales representatives. According to GCI’s Brazilian Consumers Seek Body Creams with the ‘Right’ Story on-line article, direct sales is the most popular channel due to the fact consumers do not always have access to products before purchasing them. Brand and product story-telling proves to be a very effective marketing method for this channel.
- Franchises are specialty and personalized stores who take a more specific approach to catering to their consumer’s needs. According to Exploring Brazil, 90% of fragrances are distributed though this channel.
Brazil’s CT&F market in terms of imports and exports over a decade
Brazil’s beauty market has a global ripple effect!
Coty has been inspired to use some of their Brazilian market campaigns into global methods for their brand. For instance, OPI’s Brazil color collection and ADIDAS Get Ready body care collection was a campaign that correlated to the celebration of the 2014 FIFA World Cup in Brazil. These campaigns generated such great success that Coty initiated the idea into their global platform.
Brazil’s beauty audience is a global leader in consistently making the beauty industry play catch up to their desires in beauty product enhancers. One of the market’s biggest current trends is consumer’s focus on the senses, e.g. how the packaging looks, creamy body and hair care textures, and fruity scents. Also the emphasis on hair conditioning by Brazilians created a wave of followers across the global market in the last few years.
What beauty categories and product claims do Brazilian consumers care about?
Brazil’s CT&F market emphasizes body care. According to GCI magazine article Consumers Seek Body Creams with the ‘Right’ Story, there is a high demand for body creams and lotions with claims of skin-enhancements, claims such as vitalizing, firming, counter acting cellulite, and stretch marks. This is the same for body care products with emotive claims such as smooth, silky-skin, and shiny.
According to Mintel: Brazil is a Natural Beauty Hot Spot, “Natural beauty products are popular in Brazil, particularly in skincare, with eight in 10 Brazilian skincare product users preferring products that contain natural ingredients.” Mintel research shows the natural beauty products are very popular in Brazil, particularly in skin-care, with 8 in 10 Brazilian skin-care products users preferring products that contain natural ingredients.
Mintel Market Size states, “The value of the beauty and personal care retail market in Brazil is expected to rise to over $USD 19 billion in 2014”.
Brazil’s CT&F market is trending ahead of the global CT&F market curve, and this is due to Brazilian consumers knowing what they want. They are intelligent and sophisticated in their beauty buys. Their ability to prove the significance of beautiful, clean, and natural beauty products places them in a CT&F class of their own!
ABIHPEC organization was founded in February of 1995 and represents national and international Brazilian industries, as well as multinational industries operating in Brazil manufacturing Personal Hygiene, Perfumery, and Cosmetics (HPPC). According to ABIHPEC, their mission is to maintain, develop, motivate and establish a movement through their instruments in order to contribute towards the progress of the HPPC industry in Brazil.