Overview of Chile’s Toiletries, Fragrances and Cosmetics Market

Overview of Chile’s Toiletries, Fragrances and Cosmetics Market

Chile’s buoyant economy has allowed consumer access to higher aggregated value products, fostered innovation and promoted a very competitive market, one in full growth. One factor contributing to increased sales of toiletries, fragrances and cosmetics (HPPC) products in Chile is the larger number of women in the workplace. These consumers understand how important grooming is for recognition and career enhancement, in addition to it being a matter of personal satisfaction.

In addition, people are seeking out anti-aging treatments earlier, meaning a growth in specialized retail from drugstore chains. Another factor positively impacting on the market is companies’ widespread participation in direct sales of higher aggregated value products, and consumer desire for quality and benefits. There is without a doubt a trend toward heightened consumer sophistication. This is connected to several factors, mainly globalization, and opens up new retail opportunities.

A further novelty is QR Codes (Quick Response Codes) that help boost e-sales (E-Commerce). This tool is becoming an important source of information on product characteristics. Industries and retailers use this in catalogs, press media and other materials.

Groupon entered Chile in 2010 and boosted the number of companies offering online discount coupons, making this one of the most successful strategies for attracting consumers and fixing the brand in consumers’ minds. One of the channels benefitting most from this was the beauty salon, with offers on manicures, makeup and hairdressing, and discounts of up to 70%.

This persuaded a great many consumers, who before had no access to these services, to go to beauty salons. Thus more purchases of professional cosmetics brands, hair care brands, hand cream and nail polishes were made.

Chile’s HPPC market grew 53.2% in 2012 over 2008. The worldwide recession led consumers to seek out cheaper products to maintain their consumption, impacting on sales value, but not sales volume. On the other hand, multinationals have launched several products with innovatory formulas, packaging and formats, which has raised growth in Chilean market value.

Trends and Opportunities

Opportunities lie in bath and shower products, makeup, fragrances, sunscreen, men’s products and premium products.

Unilever Chile is an HPPC company retail leader (2012 data). Of the many direct sales companies, Ebel SA (Belcorp) and Natura are two with a high growth index. Thanks to the promotion of the concepts of sustainability and the ever-increasing concern for the environment, there is a greater consumer preference for companies concerned with these issues.

The launch of products designed to eliminate shiny skin has aroused men’s interest and persuaded them to try the products. Some very successful men’s lines are Eucerin (Men Silver Shaver), the Vichy Homme Line (Hydra Mag C Hidratante, with magnesium and vitamin C) and Biotherm Homme (High Recharge Yeux Line – a serum that works to reduce eye wrinkles). Chile is today a market in expansion and with opportunity for growth, and companies should turn their attention to the consumer, focusing on innovations and products with a higher aggregated value.

Source: III Caderno de Tendências 2014-2015 da ABIHPEC / III Book of Trends 2014-2015

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