Strategy Briefing

Corporate Strategies in BPC

Oct 2017

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About This Report

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Multinationals deploy multi-pronged strategies to expand their sales upon shifting market dynamics. One of the defining challenges in global beauty in recent years has been the increasing competition international players and heritage brands face from local companies, alternative business concepts and start-ups. However, these challenging factors also fuel all strategic directions of major companies: frequent bolt-on acquisitions, research partnerships and more intense in-house developments.

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Overview

Why buy this report?

Gain competitive intelligence about market leaders. Track key industry trends, opportunities and threats. Inform your marketing, brand, strategy and market development, sales and supply functions.

Global beauty industry has moderate level of consolidation across all regions

In both Asia Pacific and the Middle East and Africa, smaller, local and regional players still dominate the competitive landscape but a contrasting consolidation trend has been unfolding between 2011 and 2016 in these two regions.

Uneven competitive landscape

One of the defining challenges in recent years has been the increasing competition international players and heritage brands face from local and regional companies, niche labels and alternative business concepts.

Shake-up at the top of global ranking table

In 2016, the top of the global ranking table was shaken up by the finalisation of Procter & Gamble’s divestment of its selected beauty brands to Coty’s. As a result, Procter & Gamble lost its long-held global top position to L’Oréal and Coty became the fifth largest beauty player.

Access to new growth platforms via series of bolt-on acquisitions

Most newly integrated brands operate on premium price platforms. They extend the new owner’s consumer base without cannibalising the revenues of pre-existing brands and these are comparatively small brands with revenues under USD1 billion and limited geographic reach.

Growing number of sustainability growth initiatives

A host of technological, environmental and economic changes are driving demand for more naturally derived ingredients, as well as adding multiple new angles to this still undefined category of green beauty.

Tacking challenges on the horizon

Major challenges industry players are facing include the rapid rise of local competition in the most attractive growth markets and the increasing number of disruptors with alternative business models. Internal challenges lie with the complexities of integrating large-scale new assets and finding the right balance between brand repositioning along major trends versus launching brand new labels.

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Introduction

Scope

Key findings

Competitive Environment

Americas the most consolidated beauty market environment

Opposite dynamics in Asia Pacific and Middle East and Africa

High industry concentration in staple categories

Fragmentation of demand in highly personalised categories

Uneven competitive landscape

Shake-up at the top of global ranking table

Major impact from large scale M&A’s

Intensifying competition for share in dynamic premium space

Targeting multiple emerging growth platforms

Strategic Growth Pillars

Strategic Growth Pillars: Strengthening Core Business

Increasing focus on core strengths drives divestments

P&G cuts categories lacking fit and underperforming brands

Avon reduces exposure to the most challenging region

Building scale to emerge as a major player

Enlarged Coty sets off with sluggish growth

Revlon does not fill significant market gaps with Elizabeth Arden

Strategic Growth Pillars: Filling Portfolio Gaps

Access to new growth platforms via series of bolt-on acquisitions

Challenges to sustain growth momentum generated by acquisition

Target categories for next wave of M&As

Strategic Growth Pillars: Growing in New Markets

Asian companies’ expansion shows influence on global beauty

Natura gains developed market foothold via The Body Shop

Strategic Growth Pillars: Leading in Sustainable Industry Standards

Growing number of sustainability growth platforms

Rising consumer awareness drives “green” strategies

Tapping into a wide range of emerging environmental trends early

Strategic Growth Pillars - Industry disruptors, alternative business models and technologies

Multi-pronged strategies to benefit from category disruptors

Strategic Growth Pillars: Industry Disruptors, Alternative Business Models and Technologies

First movers advantage in novel growth concepts

Future Strategies

Balancing out new industry dynamics

Health alignment in beauty key to success

Conquering the new frontiers of health in beauty

Commercialisation of demand for ethical claims

Multiple ways to differentiate across the premium spectrum

Offering premium experience via own branded services

Capturing future markets for digital beauty consumers

Digital activation drives colour cosmetics’ diverse prospects

Tackling external challenges on the horizon

Focus on internal realignments

Appendix

Definitions

Appendix: Competitor Analytics

Competitor Analytics tool

Overview

Competitors

Market Overlap

Treemap

Overlap Matrices

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained

Significance and applications for growth decomposition

Key applications for Industry Forecast Models

Why buy this report?

Want to find out more about this report?

Request more information

Megatrends

Strategy Briefing

Corporate Strategies in BPC

New Report Guarantee

About This Report

New Report Guarantee

Overview

Why buy this report?

Global beauty industry has moderate level of consolidation across all regions

Uneven competitive landscape

Shake-up at the top of global ranking table

Access to new growth platforms via series of bolt-on acquisitions

Growing number of sustainability growth initiatives

Tacking challenges on the horizon

Want to find out more about this report?

Table of Contents

Introduction

Scope

Key findings

Competitive Environment

Americas the most consolidated beauty market environment

Opposite dynamics in Asia Pacific and Middle East and Africa

High industry concentration in staple categories

Fragmentation of demand in highly personalised categories

Uneven competitive landscape

Shake-up at the top of global ranking table

Major impact from large scale M&A’s

Intensifying competition for share in dynamic premium space

Targeting multiple emerging growth platforms

Strategic Growth Pillars

Strategic Growth Pillars

Strategic Growth Pillars: Strengthening Core Business

Increasing focus on core strengths drives divestments

P&G cuts categories lacking fit and underperforming brands

Avon reduces exposure to the most challenging region

Building scale to emerge as a major player

Enlarged Coty sets off with sluggish growth

Revlon does not fill significant market gaps with Elizabeth Arden

Strategic Growth Pillars: Filling Portfolio Gaps

Access to new growth platforms via series of bolt-on acquisitions

Challenges to sustain growth momentum generated by acquisition

Target categories for next wave of M&As

Strategic Growth Pillars: Growing in New Markets

Asian companies’ expansion shows influence on global beauty

Natura gains developed market foothold via The Body Shop

Strategic Growth Pillars: Leading in Sustainable Industry Standards

Growing number of sustainability growth platforms

Rising consumer awareness drives “green” strategies

Tapping into a wide range of emerging environmental trends early

Strategic Growth Pillars - Industry disruptors, alternative business models and technologies

Multi-pronged strategies to benefit from category disruptors

Strategic Growth Pillars: Industry Disruptors, Alternative Business Models and Technologies

First movers advantage in novel growth concepts

Future Strategies

Balancing out new industry dynamics

Health alignment in beauty key to success

Conquering the new frontiers of health in beauty

Commercialisation of demand for ethical claims

Multiple ways to differentiate across the premium spectrum

Offering premium experience via own branded services

Capturing future markets for digital beauty consumers

Digital activation drives colour cosmetics’ diverse prospects

Tackling external challenges on the horizon

Focus on internal realignments

Appendix

Definitions

Appendix: Competitor Analytics

Competitor Analytics tool

Overview

Competitors

Market Overlap

Treemap

Overlap Matrices

Appendix: Industry Forecast Model

About Euromonitor International’s Industry Forecast Model

Soft drivers and the Industry Forecast Model

Growth decomposition explained

Significance and applications for growth decomposition

Key applications for Industry Forecast Models

Why buy this report?