Eastern Europe remains small in terms of global spending on colour cosmetics. Growth dynamics is undermined by increasing price competitiveness and economic difficulties in largest markets such as Russia and Ukraine. Facial make up benefits from premiumisation trend in economically-stable markets while eye and lip segments are primarily supported by product extensions and innovations. Leading companies, focused on younger digitally-savvy audience, benefiting from affordable and trendy make-up.
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Eastern Europe represents a small share of total global spending on colour cosmetics, lagging behind developed regions. Despite high unmet potential, the market struggles to generate robust growth due to major regional discrepancy in terms of disposable income and consumer addiction to discounts.
The glamour beauty trend supports eye and lip make-up, which remains strong in post-soviet markets such as Russia, Ukraine and Belarus. In contrast, consumers from central Europe are more inclined to neutral and “no make-up” looks that benefit growth and premiumisation of facial make-up.
Digitalisation increasingly penetrates the make-up segment thanks to accelerating efforts of leading companies in targeting millennials and Generation Z. L'Oréal, Estée Lauder and LVMH enlarge and strengthen their brand portfolios and product ranges with affordable “professionally” claimed make-up in order to withstand growing pressure from smaller disruptors.
In-store shopping remains the most convenient and trusted way to purchase cosmetics in Eastern Europe. Over 2013-2018, leading store-based retailers have benefited from wide product ranges, better availability and personalised in-store experiences and services. Thus, this sharply undermined positions of direct selling that additionally suffered from soaring internet retailing sales.
Digital excellence supports growing consumer awareness. Consumers are less willing to overpay for brand name and aspirations, while more opting for product effectiveness and tangible benefits. Thus, changing consumer status symbols are increasingly blurring lines between premium and mass make-up.