Emerging markets up but European hair care unlikely to see return to growth

By Andrew MCDOUGALL

- Last updated on GMT

Related tags: Hair care, Developed country

Emerging markets up but European hair care unlikely to see return to growth
The emerging markets have come up trumps for the global hair care market covering up the jaded growth rates in Western Europe, the US and Japan.

According to figures from market analyst Euromonitor, global retail sales of hair care products increased by 5 per cent in 2011 to reach $73.7 billion (€58.8bn), mainly boosted by spending in the emerging markets, notably China, India, Brazil, Russia and Mexico.

In comparison, Euromonitor reports North America, Japan and Western Europe showed collectively flat growth between 2007 and 2011, and an increase of only 0.3 per cent last year.

 “This has been the pattern of the past five years, with the emerging markets in effect propping up the global hair care industry,”​ says Rob Walker, senior FMCG analyst.

Europe to struggle

Walker claims that the US economy is gradually picking up momentum, which is buoying consumer confidence.

“However, austerity measures are set to deepen in much of Western Europe, with contagion implications globally. The net result is that hair care is unlikely to see any significant return to growth in the developed markets over the next five years,”​ he says.

The difference between the more established markets which are waning and the growing emerging markets also means that manufacturers have to develop different strategies for the different regions.

“On one, we are witnessing widespread trading down and discounting, which is squeezing industry margins. On the other, we are seeing increased trading up and aspiration-fuelled purchasing patterns,”​ explains Walker.

The hair care brands of leading Western-based manufacturers, in particular Procter & Gamble, L'Oréal and Unilever, are becoming ever more dependent on emerging market consumers to beef up revenue and bottom line.

HairCare Ingredients 2012

Timotei shampoo maker Unilever is just one of the company’s involved in the educational programme at this year’s HairCare Ingredients.

Inge Terpstra, the regional R&D director for Unilever, will focus on the natural and green trend and explain how green technologies and ingredients are being incorporated into its hair care products.

Building on the success of the two Cosmetics Design Skincare virtual conferences, HairCare Ingredients 2012 will take place on September 19th at 9am EDT, which is 1pm GMT.

For more information and to register click here​.

Related topics: Market Trends, Hair Care

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