The global cosmetics market grew by an estimated 3,6 per cent during 2014 comparing with the year before. It generated 181.000 million euros as incomes. This information comes from the EY report “The luxury and cosmetics sector financial factbook 2015 edition”.
The estimations for the future are also positive. The beauty market is set to double in size in the next 10 to 15 years. The annual growth expectations do not change and are estimated between 4 and 6 per cent until 2017.
Global cosmetics market has been fueled by innovation where consumers are always looking for quality, performance and perceived results. In addition, growth has been boosted by a strong depreciation of the euro which led the sector with an unequal prices structure in all regions.
The study highlights the digital revolution as one of the main trends due to the possibilities that it has opened for the cosmetics world. Also the retail remained as a key to growth in 2014.
The most powerful markets were Asia-Pacific (which entailed 35 per cent of the sales), Western Europe (22 per cent) and North America (21 per cent). In the future all the world regions will grow, with China, the US, Brazil, India and Japan expected to become the top markets.
The report also emphasized the three challenges that the sector faces: firstly, manage the global demand because the industry was influenced by the euro volatility and plenty of consumers preferred buying abroad so the companies had to revise it prices policy. Secondly, define a multichannel strategy as many companies are guiding its strategies to improve the customer experience and the digital area is important not only as a marketing tale but as sale channel. Finally, refine the commercial distribution model.
The European Association of Perfume and Cosmetics Products (APCE) believes that the growth of the companies could be fostered by the internationalization of these companies. One of the APCE objectives is to ease the internationalization process to its members.