Here’s How The Leading Global Beauty Players Are Growing Their Presence In India

Recently, Revlon has expressed its interest in opening over 100 exclusive outlets in India by the end of 2017. Estee Lauder launched the online sales of its Estee Lauder and MAC brands through India’s largest online beauty store, Nykaa. In July, L’Oreal also launched its bestselling makeup brand, NYX Cosmetics, in India through Nykaa. Let us explore the reasons behind India’s growing importance among global beauty leaders and then analyze how the beauty leaders are expanding their presence in India.

• India is one of the fastest growing nations in the world now and along with its economic growth, comes the growth in aspirations for a better lifestyle. Beauty and cosmetics are one of the items to fulfill this aspiration, and hence, along with the country’s growth, the beauty leaders will be increasingly focusing on India to build their businesses further.
• India’s beauty, cosmetics, and grooming market size is expected to expand from the current $6.5 billion to $20 billion by 2025. The reasons behind this growth might be the rise in the middle class’s disposable income and hence the ability to indulge in their growing aspirations to look more presentable and beautiful.
• India’s color cosmetics market size is estimated to be around $233 million according to some, and is expected to grow by 20% by 2020, mainly due to changing lifestyles and an increasing number of women joining the workforce.
• The beauty products preferences among Indians might shift from traditionally dominant domestic players to international market players by 2020.
• Along with the improved infrastructure and distribution channels, India’s rural populace is also enjoying these products thus leading to further sales growth.
• Given India’s income disparity across different segments of its population, the companies often come with products of different sizes, qualities, and prices.

How Are The Beauty Leaders Gearing Up To Tap India’s Demand For Beauty Products?

L’Oreal

L’Oreal has been present in India for over two decades now and though it is relatively young, compared to the established beauty companies in India, it is one of the fastest growing entities with a CAGR of over 21% over the last 7 years with 750,000 points of sale.

L’Oreal has an 8.5% share of India’s beauty market and is the third largest company in the country. L’Oreal’s has its own research centers in Mumbai and Bengaluru. Its local production plant such as the one in Pune helps it in catering to the needs of even the segment that is not traditionally a consumer of beauty products. For example, L’Oreal’s Garnier shampoo sachets are available in sachets costing INR 1.5 (€0.02) and consumers belonging to the lower economic segments can afford it.

L’Oreal tries feeling the pulse of the Indian consumers and catering to the needs of the country’s different economic segments.
For example, it has mass consumer brands such as Garnier, L’Oréal Paris and Maybelline New York, luxury brands such as Lancôme, Yves Saint Laurent, Kiehl’s, Ralph Lauren, Giorgio Armani, and Diesel, and professional brands like those used in beauty salons like L’Oréal Professionnel, Matrix, Kérastase, and Cheryls Cosmeceuticals, and cosmeceuticals such as Vichy and La Roche-Posay.

Estee Lauder

The premium cosmetics market in India is growing at around 24% year-on-year and Estee Lauder in India is growing ahead of the industry growth rate. The company had been sensitive to the relatively lower purchasing power of most Indian beauty users as compared to their Western counterparts, and hence the first brands that they launched in India were MAC and Clinique, as these are their entry price products to the prestige beauty market, the ones from where a consumer transitions from being a mass or drugstore beauty consumer to a premium beauty user. The company is also sensitive to the beauty ingredients or rituals unique to India and wishes to introduce these beauty regimes globally. In order to better understand customer needs, Estee Lauder has also bought a stake in Indian Ayurvedic luxury brand, Forest Essentials.

Taking  into mind India’s rapid digital progress, the company has online beauty tutorials for MAC and Clinique on their respective websites, it has also tied up with Nykaa in order to launch products for online selling.

Revlon

Though around 50% of Revlon’s revenue is still contributed by the U.S. which is not as fast growing as the emerging markets presently, Revlon is currently focusing more on growing its business in emerging markets such as India. Towards that end, it has planned to open around 100 exclusive outlets in India by the end of 2017. The company might be ending 2016 with around 30 to 35 exclusive outlets. Revlon has a popular brand image with the Indian clientele given its early entry into the country back in 1995. It currently enjoys ~13% to 15% of the $233 million Indian color cosmetics market and around 4% of the $274 million hair color market. The company has two manufacturing facilities in India at Rudrapur and Modinagar. Revlon India is also focusing on the lower tiered cities for its growth as the demand for personal care items keeps rising in these regions.

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Have more questions on L’Oreal? See the links below.

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• Why Does L’Oreal Want To Acquire The Skincare Brand, Société des Thermes de Saint-Gervais-les-Bains?
• Here’s Why L’Oreal’s Digital Progress Places It Way Ahead Of Its Peers
• How L’Oreal Stands To Gain From The Growth Of The Global Hair Care Market
• Here’s How L’Oreal Is Gaining Competitive Advantage With Its ‘Beauty Squad’

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