Fragrances in Ecuador

PROSPECTS

Mass fragrances drive category

With middle- and low-income groups comprising the largest percentage of the population, premium brands still represent a small niche, with mass fragrance brands driving the category’s growth. During 2018, both mass and premium fragrances were recovering sales, after years of strong decline that was driven by strong import tariffs and restrictions on final products and raw material for local production.

Consumers are nesting to reduce out-of-home expenses

In order to save money since the strong economic downfall in 2016, local consumers have tried to stay at home for longer and reduce out-of-home expenses. Categories such as fragrances are the most impacted with this consumer behaviour, as consumers staying at home do not feel the need to use fragrances.

Fragrances sales move through the direct selling channel

Direct selling is the strongest retail channel for fragrances in Ecuador; the leading mass brands belong to direct selling companies such as Yanbal del Ecuador, Productos Avon del Ecuador and Grupo Transbel (Belcorp). These companies own a large distribution and achieve a powerful penetration through their large salesforces.

COMPETITIVE LANDSCAPE

Yanbal Ecuador leads fragrances

Yanbal is the absolute leader of fragrances. The company has positioned its fragrances as the category reference in Ecuador.

Las Fragancias leads premium fragrances

Las Fragancias continued to lead premium fragrances. It is a local company that represents many imported premium international brands.

Commercial agreement with the EU draws a more optimistic scenario for fragrances

In January 2017, Ecuador and the EU entered a commercial agreement in which import restrictions previously established by the former government were eliminated. During 2017 mass fragrances performed well and in 2018, both mass and premium fragrances performed well, having been allowed to maintain and even reduce prices of certain products in order to be more competitive.

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