Premium Beauty and Personal Care in Peru

PROSPECTS

Premium grows faster than mass

The premium segment grows faster than the mass segment, despite the fact that there has been a slowdown between the years 2016 and 2018. The main reason why the premium segment shows higher growth is that the Peruvian market is still immature because many premium brands are not known and the vast majority of consumers still do not know or do not understand their attributes.

Economic deceleration is main threat

The economic slowdown discourages consumers from trying new products, especially if these items attract high unit prices. During these periods when family incomes do not increase, most consumers stick to the essentials or maintain already established habits.

Consumers expect better results from premium than from mass products

Consumers who buy premium products seek better results than when using mass products, and this should be perceptible starting from product consistency, for example a thicker oil, gel or cream. The main benefits that mass and premium products offer, however, are much the same.

COMPETITIVE LANDSCAPE

New direct sellers enter the premium segment

Two direct sellers focused on the premium segment, Yor Health and Nu Skin, both from the US and with a diverse offer, have entered Peru. Nu Skin focuses on skin care, combining creams and serums with devices that help to better absorb into the skin and offer benefits at the cellular level that lead the skin to once again produce collagen, elastin and other substances to give it a youthful appearance.

Demonstrations are common sales strategy

It is common in department stores to see sellers of prestigious brands such as MAC, Lancôme and Estée Lauder carry out demonstrations on the skins of potential customers. The objective is that the direct beneficiary as well as all passers-by appreciate the differences in the skin when applying skin care or colour cosmetics products.

Premium manufacturers have global strategies

The premium segment in Peru is very small and therefore does not justify the development of specific products for Peruvian consumers. Likewise, the advertising that is used is based on images that are created for all of Latin America or even for the entire world, appealing to those sophisticated consumers who travel and have access to different cultures.

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