MARKET REPORT: BRIC
With the exception of Russia, BRIC has far outgrown
the 4% global growth in beauty 2008–2009, according
to market research firm Euromonitor International.
BY CARRIE LENNARD
n Consumer trade down to less-
expensive brands and cutbacks
on non-essentials were among the
main reasons for reduced growth
in Russian beauty.
n Though the Chinese per capita
spend on beauty products will
still be just $22 per person
per annum in 2014, far lower than
the predicted $175 per person
in Brazil, there is still clear potential
for China to become the largest
beauty market in the world.
n With 14% compound annual
growth 2004–2009, the Brazilian
beauty industry is one of the fastest
growing in the world.
n The Indian beauty market is still
very much focused on basic
18 Market Report: BRIC
Growth opportunities in BRIC (Brazil, Russia, India and China) countries were identi;ed long ago. For the beauty industry, this meant a shi; in focus away
from the traditional, maturing markets
(predominantly those in North America
and Western Europe) and a chance to reach
a vast and mostly untapped consumer pool.
BRIC countries are characterized by rapid
urbanization, large populations with low
beauty product usage and emerging middle
classes. ;ese countries have come to the
fore as world economic hot spots, and are
acting as prime contributors to dynamism
in the global beauty products industry.
With the exception of Russia, BRIC has far
outgrown the 4% global growth in beauty
2008–2009, according to market research
;rm Euromonitor International.
Russia Hit Hard
As the most mature BRIC market, Russia
was hit far worse by the global recession
than the other markets, registering just
5% value growth 2008–2009, under half of
the 12% seen from 2007–2008. Consumer
trade down to less-expensive brands and
cutbacks on non-essentials were among
the main reasons for reduced growth in
Russian beauty. Whereas cosmetics sales
in Brazil and India are typi;ed by sales
of mass products, premium cosmetics
sales make up a far greater proportion of
beauty sales in Russia (accounting for 38%
of fragrance sales in 2009, for example,
compared to just 6% in Brazil, according
to Euromonitor).;is le; Russia more
vulnerable to trade down, and premium
was especially hard hit by the downturn.
Growth in premium beauty products slid
down from 20% during 2006–2007 to 0%
Booming China Holds Even
More Growth Potential
Sales in both Brazil and India are comprised
almost exclusively of mass brands, so trade
down has been far less of a possibility.
China’s growth in premium beauty products
is a more recent development. Its economy
was able to withstand the e;ects of the
recession, meaning consumers’ demand
for prestige cosmetics was only slightly
dampened 2008–2009 (13% value growth)
compared to the previous year period (16%).
China is experiencing a mass exodus
from its countryside to major cities as the
country industrializes. By 2013, China’s