Skin Care Industry Report

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A detailed report about skin care industry in India. The report covers following topics:
FMCG and Personal Care Market of India ,FMCG Industry ,SWOT Analysis , Indian Consumer Market , Growth Drivers , FMCG Market Segment , Personal Care Segment , Personal care Market , Skin Care Market ,Skin Care Market Potential , Profile of Customers , Skin Care Market Trends , Analysis of Skin Care Companies in Premium Segment , Amway , VLCC Health Care Ltd.
You can download this report from bizequation.com.

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Skin Care Industry Report

  1. 1. Outsource Research and Analysis [ANALYSIS OF INDIAN SKIN CARE MARKET]This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  2. 2. Outsource Research and AnalysisThis sample is an abridged Table of Content:version of a Customizedproject done for one of our I. Executive Summaryclients. To protect ourclient’s interests, several II. FMCG and Personal Care Market of Indiaimportant data points,analysis and key A. FMCG Industryrecommendations have not B. SWOT Analysisbeen included in thisdocument. C. Indian Consumer Market D. Growth DriversFor more information about E. FMCG Market Segmentthis sample and our otherservices, please write to: F. Personal Care Segment G. Personal care Marketinfo@bizequation.com or H. Skin Care MarketVisit Our Website: I .Skin Care Market Potentialwww.bizequation.com J. Profile of Customers K. Skin Care Market Trends III. Analysis of Skin Care Companies in Premium Segment A. AmwayResearch Team:Tanay Roy, CFA B. VLCC Health Care LtdAbhijit Mitra, CFA Disclaimer The information, opinions, estimates and forecasts contained in this document have been arrived at or obtained from public sources believed to be reliable and in good faith which has not been independently verified and no warranty, express or implied, is made as to their accuracy, completeness or correctness. This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008, BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicit written permission. BizeQuation | www.bizequation.com
  3. 3. Outsource Research and AnalysisI. EXECUTIVE SUMMARY:Indian market is one that is huge in size; it exhibits different social and cultural patterns across differentgeographic segments. The market is also promising and set to grow in multiple in future.Increasing consumer spending power has made skin care one of the rapidly growing industries in India. Thecosmetics and personal care industry has been growing at an average rate of 15-20 percent for the last fewyears. The annual value of personal products business in India, including oral care, hair cares and skin caresproducts, is currently estimated to be Rs 25.6 bn. Growth has come mainly from the low and medium-pricedcategories, which account for 80 percent of the cosmetics market in terms of volume. Even though mass-market products still constitute the major portion of the India cosmetics and toiletries market, increaseddisposable income has led to growth in demand for premium products. The urban population in particular, withits rising purchasing power, is the main force that drives the demand for various cosmetic products in India.This report aims to depict Indian market for skin care product.SCOPE OF THE REPORT:  Understanding the market for FMCG, personal care and skincare  Understanding the growth drivers and demand drivers of Indian market  Understanding the available premium segment skincare product in IndiaAPPROACHES AND METHODOLOGY  The study takes secondary research approach to cover the scope of the report. This includes scanning  Publicly available reports, news, blogs and trade publication. All the available data are then synthesized and  Analyzed to present in this report with all analytical insights.This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  4. 4. Outsource Research and Analysis II. FMCG AND PERSONAL CARE MARKET OF INDIA: Products which have a quick turnover, and relatively low cost are known as Fast Moving Consumer Goods (FMCG). India‟s FMCG sector is the fourth largest sector in the economy and 1,20,000 Cr creates employment for more than three million people in downstream activities. According to Indian FMCG market is one the FICCI- Technopark report, FMCG market is estimated to be worth US$25 billion (Rs. 1, 20,000 important sector Crores), including Tobacco. It has grown consistently over the last 3-4 years including last 12 and has registered months of economic slowdown. The sector is expected to grow at a CAGR of around 12% over a robust growth rate. the next few years to reach a size of US$ 43 billion (Rs. 2,06,000 crores) by 2013 and US$74 billion (Rs.3,55,000 Crores) by 2018.The sizable Indian population, Consistent economic growth and higher disposable income are key growth drivers for the industry. Exhibit-I shows key statistics related to the industry. SWOT ANALYSIS: Strengths:  Low operational costs  Strong distribution networks in both urban and rural areas Weaknesses:  Lower scope of investing in technology and achieving economies of scale, especially in small sectors  Low exports levels Opportunities:  Untapped rural market  High consumer goods spending Threats:  Removal of import restrictions resulting in replacing of domestic brands  Slowdown in rural demand 12000 10967 EXHIBIT‐II: FMCG Market Size 2008‐09 EXHIBIT‐I: Key Statistics of FMCG Industry States with more than 10% pa growth FMCG Market Size US$ 25 bn (1,20,000 Cr) 10000 During The Period 2006‐07 to 2008‐09 Expected Market Size (2013 & US$ 43 and 73 bn 8000 2018) (Rs. 206000 and 355000 Cr) 5402Rs.In Crores Expected CAGR 12% 6000 4267 4065 3953 Historical Growth 12%-15% 4000 Retail Stores 12-13 million 2000 1053 593 Advertisement Spending US$ 2 bn 0 Delhi Orisa Haryana Chhattisgarh Gujrat Goa Uttaranchal Source: Technopark, FICCI, Web source, INDICA Database This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008, BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicit written permission. BizeQuation | www.bizequation.com
  5. 5. Outsource Research and AnalysisINDINA CONSUMER MARKET:According to a study by the McKinsey Global Institute (MGI), Indian incomes are likely to grow three-fold overthe next two decades and India will become the worlds fifth largest consumer market by 2025, moving upfrom its position in 2007 as the 12th largest consumer market. Exhibit-III provides a detail statistics of Indianconsumer market. EXHIBIT‐III: Indian Consumer Market Market Demographics Market Size( in US $ Billion) Population( 1166 mn) 1221 1600 4.1X 1479 1400 Female 1200 191 1036 population( 178 1000 2… 725 800 Personal 600 507 3482 359 disposable 400 2720 income ($) 200 0 0 1000 2000 3000 4000 2005 2010 2015(E) 2020(E) 2025(E) 2012(E) 2008 City Wise Market Size (in US$ bn) India Vs. China (market size and Growth) 30 30 (US$ bn) 25 21 China 709 1424 2859 20 15 7.9% 9 10 6 7 4 5 India 359 725 1479 7.3% 0 Delhi Chennai Hyderabd Mumbai Kolkata Bangalor e 0 1000 2000 3000 4000 5000 2005 2015(E) 2025(E)Source: Source: Web source, INDICA Database, MGIThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  6. 6. Outsource Research and AnalysisGROWTH DRIVERS:  Changing Income Patterns  More consumption Opportunity, very low per capita consumption compared to other Asian and  Developed countries  Accelerating Disposable income in Urban  Increasing discretionary spending EXHIBIT-IV: Growth Drivers Changing Income Pattern Low Per Capita Consumption 2.56 HouseHold (m) 181 231 Hair Care 1.11 1.32 Strivers 131 96 Colour Cosmetics 0.22 1.74 Aspirers 46 124 Oral hygiene 0.75 5.11 Affluent 3 11 Skin Care 0.55 0 100 200 300 400 500 0 1 2 3 4 5 6 2003 2013(E) China IndiaSource:Technopark,FICCI,MGI,Websource,INDICA DatabaseFMCG MARKET SEGMENT:Exhibit-V and VI provides a segmental breakup of FMCG industry. Food and Beverages lead the industry with53% market share, followed by Personal Care Market. This report is aiming to cover personal care segment indetail. EXHIBIT-V: Segmental Break-up of FMCG MarketAn increase is spending pattern has been witnessed inIndian FMCG market. There is an upward trend inurban as well as rural market and also an increase in 2% 20%spending in organized retail sector. The foodscategory in FMCG is gaining popularity with a swing of 15% 53%launches by HUL, ITC, Godrej, and others. The Indianbeverage industry faces over supply in segments like 10%coffee and tea. However, more than 50 per cent ofthe market share is in unpacked or loose form. Themajor players in this segment are Nestlé, HUL and Lighting Food & Beverages HouseHold CareTata Tea. Tobaco Personal CareThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  7. 7. Outsource Research and Analysis EXHIBIT-VI: FMCG Segment, Product and Major Players Segment Products Major Players HUL, Nirma, Godrej consumer, Household Care Fabric wash,household cleaners ITC P&G D b R kitt& ITC, G, Dabur, Reckitt &Colman Oral Care, hair care, skin care, personal Colgate‐Pamolive, HUL, Dabur, wash, cosmetic and toiletries, Lakme, Marico, Fem Care, Emani, Personal care deodorants, perfumes, female hygiene P&G, Himalaya, ITC, Godrej products, paper products Consumer Products Staples/cereals, bakery products, snak Food food, chocolates, ice cream, branded Parle Agro, Britania, ITC, Nestle, food grains PEPSICO Health beverages, soft drinks, tea, coffee Beverages and United Breweries, Dabur, Radico, bottled water Khaitan, PEPSICO etc.Source: Technopark, Web source,PERSONAL CARE SEGMENT: EXHIBIT‐VII: Personal Care Segment in IndiaIndian personal care product market is estimated tobe worth $5 bn. Personal hygiene product, hair care,skin care and color cosmetics are the key segment of 6% 1% 16%the personal care market. Exhibit-VII shows the 46%market share of each key segment. Personal Care product market has grown ~5% 31%p.a. over the last couple of year. Each of thesegments of personal care product market showsunique trend and growth patterns For example bath Bath & Hair Care Skin Care Colour Otherand shower patterns. , product has grown at ~5% Shower Product Cosmeticsp.a. over the last five years. In comparison, thesecond largest segment of hair care products has seen a much higher growth of ~9‐10% p.a. over the sameperiod. The skin care market is relatively smaller and is growing at a high rate while moving away from basiccreams and moisturizers to specialized products such as anti‐wrinkle and dark circle removing creams. Forexample, the anti‐ageing segment, though only 2% of the skin care market has been growing at a rate greaterthan 90% p.a. over the last few years.This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  8. 8. Outsource Research and AnalysisPERSONAL CARE MARKET:Exhibit –IX shows the regional breakup of personal care market in 2006. Maharashtra, Uttar Pradesh and WestBengal are three major markets for personal care product with around 37% of market share. Exhibit-VIIIdepicts the share of each region. EXHIBIT-VIII: State Wise Personal Care Market (US$ mn) 846 900 800 581 700 600 392 376 338 500 305 305 277 276 242 400 216 215 154 144 300 122 200 100 0 Orissa Uttar Pradesh Gujrat Kerala Punjab Other Karnataka Maharastra Andhra Pradesh Haryana Bihar Madhya Pradesh Rajasthan Tamil Nadu West Bengal EXHIBIT-IX: Region wise share of Personal Care Market Maharastra Uttar Pradesh 6.9 2.8 17.3 West Bengal 2.9 Andhra Pradesh 3.2 Tamil Nadu 4.4 Gujrat Madhya Pradesh 4.4 11.8 Karnataka Bihar 5.6 Rajasthan Punjab 5.7 8.0 Haryana 6.2 Kerala 7.7 Orissa 6.2 6.9 Other Source: icongrouponline.This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  9. 9. Outsource Research and AnalysisSKIN CARE MARKET:The skin care market in India is estimated at ~US$ 800 million. Current per capita spending on skin care isapproximately US$0.55 compared to US$ 5.11 in China. Also, the skin care market in India is growing rapidlywith growth of economy, disposable income and consciousness about health and beauty. The market hasgrown about 13-15% p.a. in last couple of years and have immense opportunity to grow in future. Exhibit-XIshows Key Statistics of Indian skin care market. EXHIBIT-X: Key Statistics of Indian Skin Care MarketThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  10. 10. Outsource Research and AnalysisSKIN CARE MARKET POTENTIAL:According to Euro monitor, changing consumer lifestyle, adoption of developed world cultures, desire to lookgood and rapid urbanization are few causes for growing skin care awareness and market. The market isestimated to grow about 15% p.a. to reach at US$1.19 bn by 2013. Exhibit-XII shows the major growth driversfor Indian skin care market EXHIBIT-XI: Skin Care Growth Drivers Desire for Anti‐Aging Economic Cosmetic Development Procedure sTRONG Improved gROWTH Awareness of Market standard of Product and Living benefit Expansion to Media new Channels AttentionThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  11. 11. Outsource Research and AnalysisPROFILE OF CUSTOMER: EXHIBIT-X: Female and Male both access beauty services in all cities FEMALE MALE 100% 100% 80% 83% 100% 100% 50% 80% 100% 100% 60% 60% 67% 100% 100% 83% 100% 40% 100% 40% 20% 100% 100% 83% 20% 67% 50% 0% 17% 0% Delhi Bangalore Mumbai Kolkata Delhi Bangalore Mumbai Kolkata Employed Students Housewives Employed Students EXHIBIT: XI: Customer profile age distribution & Income Distribution MALE FEMALE 100% 17% 100% 50% 50% 90% 83% 67% 50% 100% 100% 80% 83% 80% 50% 100% 83% 70% 100% 100% 60% 100% 60% 100% 100% 100% 50% 100% 100% 100% 40% 100% 100% 40% 100% 30% 100% 100% 20% 100% 20% 100% 100% 100% 100% 10% 100% 17% 33% 33% 33% 50% 0% 0% Delhi Bangalore Mumbai Kolkata Delhi Bangalore Mumbai Kolkata More Than 40 years 30-40 years 25-30 years More Than 40 years 30-40 years 25-30 years 20-25 years Less than 20 years 20-25 years Less than 20 years MALE FEMALE 100% 100% 33% 33% 33% 50% 80% 80% 83% 100% 100% 100% 100% 100% 100% 60% 60% 100% 40% 40% 100% 100% 100% 100% 100% 100% 20% 20% 100% 100% 0% 0% Delhi Bangalore Mumbai Kolkata Delhi Bangalore Mumbai Kolkata Lower middle class Middle class Upper middle class Upper class Lower middle class Middle class Upper middle class Upper classThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  12. 12. Outsource Research and AnalysisSKIN CARE MARKET TRENDS: EXHIBIT-XII: Market Trends Strong Desire for fair Skin Men’s Skin Anti ‐agers Cosmetic care Skin Procedure Care Natural & Skin Care ethical Application ProductsThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  13. 13. Outsource Research and Analysis EXHIBIT-XIII: Skin Care Trends & Drvers Trends Drivers Next DevelopmentStrong desire  Fairer equals to upper class Stressful  Whitening will extend beyond the facefor fair skin: lifestyle  Skin whitening for men  Busy lifestyle resulting in less  More stringent regulations on skin sleeping time whitening products  Stress hormone sends the skin‟s oil  Critics on skin whitening products glands into overdrive  Anti-agers plus whitening productsAnti‐agers:  Ageing population  Target young consumers: Prevention  Accelerated ageing better than cure  Rising pursuit of agelessness  Super-premium: From global to local  brands  Mass brands developments  Cosmeceuticals: Collaboration between cosmetics and pharmaceutical company  New technology and ingredient  More regulated industry to ensure the safety of cosmeceuticals  Facing strong competition from  aesthetic beauty service industrySkin care  Increased consumer knowledge on  Change of Preferences: Usual Routine:application: skin care application: TV beauty Cleanser->Toner->Moisturizer. New Routine: programs educates consumers on Cleansing Liquid Liquid-> Cleanser-> Lotion-> different products‟ benefits products AC Essence->Mask->Emulsion-> Effector->  Technology advancement: White Essence Cream.  Skin care evolution thanks to  Development of more powerful products technology and research  Consumers may “outsource”  Beauty web blogs to allow consumers  personal care and pay for spas and to exchange ideas treatmentMen‟s Skin Care  Workplace: Pressure from  Stronger growth than skin care competition in workplace led to the  Moving away from 3 basic cleaning steps emergence of metro sexual man  New technology: Focusing on  Greater acceptance in developing  convenience nations: Move to more „advanced‟ productsThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  14. 14. Outsource Research and AnalysisIII. ANALYSIS OF SKIN CARE COMPANIES IN PREMIUM SEGMENTAmway:About The Company:Arbonne International, LLC offers skin care products based on botanical principles. The company‟s products includebody care, hair care, anti‐aging, baby care, natural balancing creams, weight loss, and nutrition products, as well ascolor cosmetics for face, eyes and cheeks, and lips. It also offers products for aromatherapy and cellulite. Thecompany markets its products in the United States, Australia, Canada, and the United Kingdom. The company offersits products through a network of independent consultants and online. The company is based in Irvine, California.Arbonne International, LLC is a former subsidiary of Levlad, Inc. THE U.S.A. Arbonne (the “Company”) is a directselling company that operates internationally. Arbonne markets an exclusive line of high quality skin care and colorcosmetics based on natural and botanical principles. Arbonnes skin care products, based on botanical principles,became a reality in the United States in 1980. Arbonne skin care products are available in the following categories:antiaging skin care, radiance and hydration, detox, acne and blemish, makeup for face, eyes, and lips, aromatherapy,healthy living, and nutrition.Skin Care Brand Skin Care BrandOrigin SwitzerlandNumber of Skin Care Product 81Botanical/ Natural Ingredients BotanicalPrice Range Rs. 235-14030 : ( US$ 5- US$298.50)Retailing Process Direct salesVLCC Health Care Ltd:About The Company:VLCC is a manufacturer exporter of Herbal Cosmetics in India. It is the number one in India as far as HerbalCosmetics products are concerned and also marked the first step towards corporatization of the slimming, beauty andfitness business in India. Today, the 72 centers of VLCC spread across 38 cities in India have come to besynonymous with weight management and beauty treatments and services That VLCC is one of India most services.recognized brands in its own right is an acknowledged fact and this is reinforced by its recent induction into theworld-wide hall of fame for brands by being awarded the international Superbrand status. It was founded by Mrs.Vandana Luthra in 1989.By redefining wellness, VLCC revolutionized this industry and acquired the status of India‟s largesthealth and beauty brand. Today VLCC is the single largest player in the organized sector with a pan‐ India presenceof nearly 225 outlets across 75 cities, 1 in Kathmandu, 9 locations in UAE, 2 in Oman, 1 in Bahrain and 1 in Al Ain.The VLCC Group, a „Superbrand‟, serves as an umbrella for all its other brands – VLCC Health Care Ltd., VLCCPersonal Care Ltd. and VLCC Institute of Beauty, Health and Management. VLCC‟s services provide holisticwellness, as a service, marrying scientific research and traditional therapiesSkin Care Brand VLCCOrigin IndiaNumber of Skin Care Product 28Botanical/ Natural Ingredients BotanicalPrice Range Rs. Rs. 515‐1880: (US$ 10.95‐US$39.95)This is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com
  15. 15. Outsource Research and Analysis Write to: info@bizequation.com Visit Our Website: www.bizequation.comThis is an Illustrative Case Study, Please Contact us for more information. Write to info@bizequation.com . © 2008,BizeQuation. All Rights Reserved. No part of this document may be copied, altered, reproduced or transmitted without explicitwritten permission. BizeQuation | www.bizequation.com

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