Premium Beauty and Personal Care in Ecuador

PROSPECTS

Premium colour cosmetics consumers migrating to mainstream products

Premium categories were the most impacted in beauty and personal care towards the end of the review period, not only because of economic contraction in 2016, but mainly because of import restrictions and high taxes which increased in 2014, raising the prices of imported products, in some cases by more than 100%, as most premium products were not locally produced. After 2016’s economic crisis, many consumers from mid- to high-income consumers migrated to mass categories, not wanting to sacrifice their purchase of a certain product, but instead moving from a premium brand to a more affordable one.

Premium fragrances limit consumption

To save money, consumers try to stay for longer periods of time at home to reduce out-of-home expenses. Among the most affected categories impacted by the nesting trend are fragrances, as consumers staying at home do not feel the need to use fragrances.

Limited offer of premium categories driven by import restrictions

Import restrictions, which became stricter since 2014, have strongly limited the offer of premium brands. Most premium products originate from North America and Europe, and to a lesser extent from China and Colombia.

COMPETITIVE LANDSCAPE

Las Fragancias focuses efforts on recovering sales of fragrances

Main premium brand owner Las Fragancias is one of the most important players among premium beauty and personal care. The core category for this company is fragrances, which are directly imported.

Commercial agreement with the EU drawing a more optimistic scenario for the category

In January 2017, Ecuador and the EU started a commercial agreement, in which import restrictions established by the former government were eliminated. In this sense, fragrances will witness a positive scenario during forecast period.

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