Brazil's future is rosy for cosmetics & toiletries marketers

17 Sep '05

4 min read

'On one end of the spectrum, market growth is being driven by increasing awareness of the need for sun protection, more technologically advanced products, and higher price points. But there are also the more rural regions where people don't use many product categories regularly, and these are untapped sources of growth for cosmetic and toiletry marketers,' she says.

With the country's recent economic upturn, distribution channels are also developing further, giving marketers increased access to consumers. Mass merchandisers already represent the largest sales channel for cosmetics and toiletries in Brazil, but direct sales hold a large share of the market as well, driven largely by Natura and Avon. This will likely change, however.

'As economic development continues, they'll see further expansion of mass merchandisers and specialty stores. And although there is still plenty of room for overall market growth, direct sales will likely lose some of its market share to newly opened outlets, even if value sales in all channels continue to increase,' says David Vladyka, head of Kline's Consumer Products consulting practice.

Kline's analysis of the cosmetics and toiletries market for Brazil is echoed by a recent report by the United Nations Conference on Trade and Development that names Brazil as one of the five most attractive places for foreign investment in 2005 and 2006.

'The mature markets for cosmetics and toiletries––the U.S., WesternEurope, and Japan––have offered only minimal growth over the last five years, and marketers should be looking to countries like Brazil as a new source of growth,' says Contreras.

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