Colour Cosmetics in Eastern Europe

Strategy Briefing

About This Report

Jul 2019

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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Colour Cosmetics in Eastern Europe

Key Findings

Colour cosmetics records uneven performance in Eastern Europe

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.

Consumer preferences vary depending on cultural and financial aspects

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.

Leading players focus on younger digitally-savvy consumers

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.

Direct selling ceding ground to physical stores and internet retailing

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.

The blurring boundary between premium and mass

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. 




Key findings

Regional Overview

E astern Europe remains weak in colour cosmetics
Value sales anticipated to recover over the forecast period
Make-up preferences vary in the biggest markets
Facial make-up soars in smaller countries
Russia performs far worse than other regional countries
Uneven performance limits absolute value growth
Competition between segments, products and brands intensifies
Store-based retailing leads within increasingly diversifying distribution
Distribution is modernising and becoming more competitive

Leading Companies and Brands

Leading companies preserve breakaway despite the growing tension
Professional and niche brands help leading players to stay afloat
Overreliance on biggest markets endangers leading players
Direct sellers are under attack giving way to leading retail brands

Forecast Projections

Huge regional discrepancy is expected to disrupt market growth
Uneven economic development contributes to sluggish growth
Habit persistence, GDP growth and soft drivers contribute to growth
Innovations and promotion are key soft drivers over the forecast period

Country Snapshots

Belarus: market context
Belarus: competitive and retail landscape
Bosnia-Herzegovina: market context
Bosnia-Herzegovina: competitive and retail landscape
Bulgaria: market context
Bulgaria: competitive and retail landscape
Croatia: market context
Croatia: competitive and retail landscape
Czech Republic: market context
Czech Republic: competitive and retail landscape
Estonia: market context
Estonia: competitive and retail landscape
Georgia: market context
Georgia: competitive and retail landscape
Hungary: market context
Hungary: competitive and retail landscape
Latvia: market context
Latvia: competitive and retail landscape
Lithuania: market context
Lithuania: competitive and retail landscape
Macedonia: market context
Macedonia: competitive and retail landscape
Poland: market context
Poland: competitive and retail landscape
Romania: market context
Romania: competitive and retail landscape
Russia: market context
Russia: competitive and retail landscape
Serbia: market context
Serbia: competitive and retail landscape
Slovakia: market context
Slovakia: competitive and retail landscape
Slovenia: market context
Slovenia: competitive and retail landscape
Ukraine: market context
Ukraine: competitive and retail landscape