Premium Beauty and Personal Care in Estonia

PROSPECTS

Increasing disposable income keeps the category growing

In Estonia, monthly gross salaries have been increasing since 2011, with year-on-year growth in the range of 6-8%. This trend has positively affected the sales of premium beauty and personal care products, as they have become more affordable.

Consumer trend of “less is more” and concern for product safety lead to premiumisation of beauty and personal care

Following global consumer trends of “less is more” and leading a “greener” lifestyle, more Estonians are opting for more expensive but better-quality premium beauty and personal care products. Compared to men, women are more proactive in reading product labels as they are more aware of the potential harmful effects of cosmetics.

Pharma beauty products are gaining popularity

Although penetration of pharma brands in Estonia remains relatively low, dermocosmetics are gaining popularity. For example, sales of La Roche-Posay recorded double-digit percentage growth in 2017.

COMPETITIVE LANDSCAPE

Global brands prevail in a fragmented environment

In 2017, premium beauty and personal care continued to be characterised by a number of small and middle-sized companies, none of which had enough of a value share to exert significant influence on the category. There were no big changes in share distribution: L’Oréal and Coty continued to lead premium beauty and personal care and ranking third was Sirowa, which represents a variety of well-known brands in premium colour cosmetics and hair care.

Domestic producers position themselves as “natural luxury”

Following the trend of premiumisation, local companies such as Lumi and Joik (which is considered to be a mass brand), increasingly aim to enter premium beauty and personal care. Both companies promote their products as “natural luxury”, targeting high-end consumers.

Availability of niche brands increases as internet retailing develops

Estonians are increasingly buying premium beauty and personal care products on the internet. If previously there was a common concern about buying fake products online, e-shops have gained more trust amongst consumers by offering flexible return policies.

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