Super Premium Beauty and Personal Care in Russia

2020 IMPACT

Closures of specialist beauty retailers and decline in tourist sales negatively impacts sales

All specialist beauty retailers were shut down since the end of March through to 1 June 2020. Among the biggest ones were L'Etoile, Rive Gauche, and Ile de Beaute, which sold the highest value share of super premium beauty and personal care products pre-COVID-19.

Consumer demand switches away from colour cosmetics and towards skin care

Consumer demand in super premium beauty and personal care has shifted from cosmetics to skin care products and goods which are attributed to a leading a healthy lifestyle. Colour cosmetics are less in demand due to lockdowns, as consumers do not place a high emphasis on their appearance during this time.

Seldico maintains company lead, although its individual brands are unable to compete with Chanel

Seldico OOO maintained its lead in super premium beauty and personal care in company terms in 2019, thanks to its strong overall brand portfolio. However, in brand terms, the player’s Givenchy, Christian Dior and Guerlain brands are pipped to the top place by Chanel (Chanel OOO), which holds a much stronger share.

RECOVERY AND OPPORTUNITIES

Slow economic recovery will continue to negatively impact sales over short-term forecast period

There are no prerequisites for the rapid restoration of real disposable incomes of Russian consumers over the short-term forecast period. As a result, low consumer disposable incomes will continue to negatively impact demand in super premium beauty and personal care in 2021-2022, undermining its performance.

All players set to focus on enhancing their online platforms over the forecast period

All players are set to focus on enhancing their online platforms over the forecast period, in a trend which was emerging pre-COVID-19 and has simply been enhanced by the pandemic. With an increasing number of middle-class aspirational consumers searching for more competitive prices in their desire to own super premium beauty and personal care, they continued to look to internet retailing in their endeavour to access affordable luxury goods.

Recovery of sales in super premium beauty and personal care remains dependent on overcoming COVID-related impacts

The recovery of super premium beauty and personal care depends on the epidemiological situation in both Russia and the rest of the world, due to the myriad factors negatively impacting the category due to the event of COVID-19. Factors to recovery will need to include the emergence of a safe and effective vaccine, along with special measures implemented by the state to control the spread of the mutating strains of COVID-19.