Is beauty a defensive sector? Swiss bank UBS surveyed 4,000 women in Western Europe and the United States about their use and purchasing of skin and hair care products — capturing 15 percent of the total global personal care market.
The findings paint a gloomy picture, consistent with the current economic climate. There is a marked rise in de-stocking as more consumers opt to buy new products only when the old ones run out; value for money is at the forefront of purchasing decisions as is promotional activity; advertising is playing a smaller role as impulse buying becomes less frequent.
Interestingly, however, more than 50 percent of the respondents answered this question by saying that the economic environment plays no role in their use/purchase decision.
In skin care, the largest category by far is day cream with 86 percent overall regular usage, followed by cleansers and make-up removers. Top five players here are L’Oreal, Beisersdorf — which owns Nivea, La prairie and Eucerin, Yves Rocher, Estee Lauder and Johnson & Johnson, which account for an average 48 percent of overall skin care consumption.
UBS analyst Eva Quiroga, who wrote the 84-page report on “European Bubble & Beauty” reckons brands such as Dove, Olay and Nivea are in the right spot in the current environment, while those including Estee Lauder, L’Oreal and Lancome are likely to be more challenged.