Premium Beauty and Personal Care in Ecuador

PROSPECTS

Premium beauty and personal care products sees higher sales growth than mass products do in 2018

During 2018, value growth of premium beauty and personal care was nearly twice as high as that of mass categories, after showing a decline in the previous four years. The growth is explained by the relief of import taxes and restrictions that started in 2017 with the new government plus the commercial agreement between Ecuador and the EU.

Premium fragrances lead premium product sales

In value terms, premium fragrances led sales of premium beauty and personal care in 2018, whilst skin care was in second place – but with a significantly lower share of value sales. Whilst demand for premium fragrances is largely limited to affluent consumers, attractive discounts and seasonal promotions are making such products more accessible and interesting to middle-income buyers.

Premium offer increases natural and organic products

Natural and organic products remain a niche amongst premium beauty and personal care, mainly because the offer is mainly local and artisanal products, with low distribution. Nevertheless, it sales are expected to grow during the forecast period, as consumers perceive these products as high quality, responsible towards the environment and aligned with the health and wellness holistic trend.

COMPETITIVE LANDSCAPE

Las Fragancias focusses efforts on recovering sales of fragrances

Main premium brand owner Las Fragancias is one of the most important players amongst premium beauty and personal care. This beauty specialist retailer is present at main malls and shopping centres of the country’s biggest cities.

Commercial agreement with EU boosting offer of new brands in premium categories

In January 2017, Ecuador and the EU entered into a commercial agreement, in which import restrictions established by the former government were eliminated. Because of this, premium products witnessed positive value sales growth in 2018 for the first time in five years and, and sales are expected to improve during the forecast period.

Promotion and seasonality are keys to sales peaks

Sales of premium beauty and personal care products are strongly influenced by point-of-sale promotion, seasonality and advertising. Amongst fragrances and skin care, main brands strongly invest in advertising targeting high-income consumers.

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