Romania singled out for cosmetics growth

By Louise Prance

- Last updated on GMT

Related tags Drug stores Personal care Revenue

Cosmetics have emerged as the fastest growing non-food product in
the Romania retail sector, proving that previous decisions by
international cosmetic manufacturers to target the rapidly
expanding category were the right move.

Romanian financial company, Ziarul Financial, has announced that cosmetics sales in drug stores rose by 42 per cent in the first half of 2006, compared to the corresponding previous period in 2005.

Cosmetic sales have also risen by 30 per cent in supermarkets. However, sales in specialist stores have decreased by 8 per cent from 2005, a reflection of the rapid evolution of the retail landscape in the country.

In June of this year Euromonitor estimated that the Romanian market for cosmetics and toiletries was valued at €250m, and projected that growth was expected to be as high as 20 per cent this year, one of the strongest growth rates in the European Union.

Many of the products that are contributing to the growth are sold in Romanian drug stores such as Catena, Centrofarm and Sensiblu. However, a report by MEMRB Retail Tracking Services, a Cyprus based market research firm, supermarkets are still outdoing the drug stores in relation to sales revenue.

The Romanian and Eastern European cosmetics markets are developing slowly, and are still somewhat behind other European markets. However, these sales figures are encouraging for the region, and could see more cosmetic players join the likes of Beiersdorf who have targeted the developing niche market in a bid to create wider geographical brand awareness.

Beiersdorf launched a blue wall promotion in the Romanian beauty market earlier this year, as part of its ongoing campaign to carve out a 5.5 per cent of the global industry for personal care products.

This followed the success of similar launches in Austria and Germany as a means of introducing consumers to the cross usage potential that exists amongst the Nivea subbrands.

Avon, has also been increasing its presence in the Romanian market, announcing that it had extended its leading position in the market by increasing its yearly revenues to €106m this year, an increase of 18 per cent.

Similarly, Swedish direct sales player, Oriflame, said earlier in the year that Romania was one of the key countries that aided the successful sales revenue they achieved in the quarterly sales and profits to June 30 this year.

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