Mexico’s Cosmetics and Toiletries Market: An Overview

Mexico’s Cosmetics and Toiletries Market: An Overview

Mexico’s largest business partner is the US. While strong local companies work in all toiletries, fragrance and cosmetics (HPPC) product categories, 2012 data show international companies still dominate the Mexican market, having over 70% of total market share.

We study Mexico’s current situation and list the main factors influencing Mexican society and consumption therein:

1) The growth of the middle class, driving the increase in middle-range-price products

There has been an increased demand for HPPC products and a growth in the value of sales in the more mature categories, such as shampoos and soaps. These new middle-class consumers seek products with more advanced and multipurpose formulation.

Less mature categories, such as sunscreen, are increasing their sales volume, offering products for families which previously would not have been able to purchase them.

2) Men are now a target for HPPC products

Research shows that Mexican men of all ages are increasingly more concerned about their appearance and health, particularly with hair loss, dandruff, white teeth and clear skin. HPPC companies have spotted this opportunity and started to offer products to cater for men’s needs. Advertising campaigns are being developed for men, and more and more companies will be producing products aimed specifically at satisfying this demand.

3) Supermarkets/ Hypermarkets (traditional retail) extend sales of HPPC products

While premium brands are traditionally sold in department stores or cosmetics stores, some prestige brands have extended their sales to supermarkets/hypermarkets, aiming to compete with mass, less sophisticated, brands.

With the creation of smaller and more accessible packaging, this segment is reaching a consumer base with less purchasing power. That said, this is not the trend for the majority of premium brands, which continue to be sold via traditional channels. mainly as they wish to be seen as prestige and status brands, out of reach of lower-income consumers.

4) Market segmentation as a key factor in mature categories

The most recent innovations have been in creating specific products for each type of consumer, trying to segment the market and stimulate growth in the value and volume of sales. In creating a specific product for each member of the family, companies foster an increase in family purchases. A good example is the family that in the past bought just one shampoo and that now buys an anti-hair loss shampoo for the man of the house, a shampoo for curly hair for the woman of the family and a shampoo for its children.

5) Categories/ Market Opportunities: Multipurpose products and with a higher aggregated value are those more sought after by today’s consumers. Categories such as products for children, depilation, segmented haircare, sunscreen, oral hygiene and the male market are also those with growth opportunities.

TRENDS

Increased urban lifestyles and women in the workplace are factors impacting heavily on Mexico’s consumption of beauty and personal grooming products. Women’s increased income in general has positive consequences for the beauty and personal grooming products industry as women are largely responsible for purchasing decisions and many products are more to women than to men.

Finally, Mexico’s decreased birth rate and increased family income sees families spending more on each child, driving a growth in childcare products such as wet wipes, sunscreen, skincare and hair care products for children.

Source: III Book of Trends 2014–2015, Abihpec (Brazilian Association of the Cosmetic, Toiletry and Perfumery Industry)

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