We got an expert’s perspective on Nordic countries as the region is increasingly having an impact on beauty trends on an international scale.
Here, we consider how and why Finland’s beauty industry is beginning to recover after the country’s poor economic profile of late. Here are exclusive insights from Euromonitor International, market research provider.
No longer stagnant
Finland’s poor economic performance during the review period had a major impact on beauty and personal care.
According to Statistics Finland, GDP declined over 2012/2014 and stagnated in 2015, before seeing a positive 1% rise in 2016.
Overall, beauty and personal care sales followed the general growth trends with a delay. Beauty and personal care current value sales in Finland fell marginally in 2014 and by 2% in 2015, but rebounded in 2016 with a 1% increase.
How the decline impacted the market
Beauty and personal care categories reacted differently to the economic decline. For example, fragrances saw a negative 2% current value CAGR over the review period.
Hair care also saw a negative 2% CAGR.
The former category was particularly sensitive to economic swings as premium brands accounted for a 75% share of retail value sales of fragrances in 2016.
While hair care had much smaller share of premium and salon products, it was significantly affected because of a highly intense competitive environment, which led to price-based promotions.
Consumer hesitation still a hurdle
Private label gained retail value share over the review period, although growth stagnated by 2016.
Regardless of growing confidence in the economy, consumer hesitation was still visible in the falling demand for premium products in 2016.
Premium beauty and personal care current value sales decreased over 2013/2016. The decline started in 2013, with a marginal fall, peaked in 2015 with a 6% drop, but slowed to a 2% decrease in 2016.
This performance was in contrast to mass fragrances sales, which saw current value growth in 2012 and 2013 and flat growth in 2014. The 2% decline in current value sales in 2015 was quickly followed by a rebound of 1% in 2016.