1. Skincare industry in india — Presentation Transcript
1. SKINCARE INDUSTRY IN INDIA DOA NAQVI MBA-Sem.III
2. INTRODUCTION Products which have a quick turnover, and relatively low cost are
known as Fast Moving Consumer Goods (FMCG). FMCG products are those that get
replaced within a year. Its principal constituents are Household Care, Personal Care and
Food & Beverages. Indiaʹs FMCG sector is the fourth largest sector in the economy.
3. SEGMENT-WISE BREAK UP OF THE FMCG SECTOR IN INDIA
HUL,Nirma,Godrej Consumer products,ITC,P&G,DaburReckett & Coleman. Fabric
wash; household cleaners (dish/utensil cleaners,floor cleaners,air fresheners,insecticides
and mosquito repellents,metal polish and furniture polish). HOUSEHOLD CARE Oral
care, Hair care,Skin care,Personal wash (soaps),cosmetics &
toiletries,deodorants,perfumes, female hygiene products. PRODUCTS PERSONAL
CARE SEGMENT Colgate Palmolive,HUL, Amway,L‟Oreal,Lakme,Marico,Cavin
Care,Fem Care,Emami,P&G,Himalaya,ITC, Godrej Consumer products . MAJOR
PLAYER
4. United Breweries,GlaxoSmith Kline,PEPSICO,Coca Cola,Radico,Dabur,Real etc
BEVERAGE : Health beverages,Tea,Coffee,Bottled Water,Juices,Liquor etc. Parle Agro,
Brittania, Nestle, Cadbury, Pepsi Co., CocaCola etc. FOOD : Staples, cereals, bakery
products (biscuits, breads, cakes, snack foods, chocolates, icecreams, branded flour,
branded rice, ready-to-eat packaged foods etc. FOOD &BEVERAGES MAJOR
PLAYERS PRODUCTS SEGMENT
5. INDIAN MARKET FOR PERSONAL CARE PRODUCTS
6. PROJECTED GROWTH Subject to sustained overall GDP growth rates of ~8-9% p.a.,
the overall Indian personal care market has the potential to grow at 15%-16% p.a. (much
higher rates for select segments like colour cosmetics, skin care and deodorants) and
thereby double to ~$8-bn by 2012-13.
7. SKIN CARE INDUSTRY OF INDIA The skin care market belongs to the Personal
Care segment of the FMCG sector in India and is valued at $180 million in India
(Approx. Rs.72,000 Cr.) With safe and effective procedures, advancement in medical
technology, increase in awareness, the Indian Skin care solutions business is growing
very fast.
8. The skin care market can be segregated into toners, cleansers, sunscreens, anti-wrinkle
creams, dark circle removing creams, astringents, facial creams, moisturizers, fairness
creams, day and night creams, etc. NEED SATISTACTION : - Personal hygiene - Soft &
Smooth skin - (to look beautiful)
9. The skin care market is at a primary stage in India. The penetration level for the rural
market is relatively low. However, within a period of five-six years, the use of skin care
products has increased significantly in India. New players such as Avon and Oriflame
have entered the market with the natural ingredient benefit platform, which could further
spur growth.
10. REASONS FOR GROWTH IN THE SKIN CARE INDUSTRY IN INDIA Concerns
about hygiene and personal grooming drive sales. Discounts boost growth in the face of
economic uncertainty. Domestic players expand their presence. Chained retailers create
opportunities for point-of-sale marketing. Rising affluence and sophistication to drive
future growth.

2. 11. VALUE CHAIN ANALYSIS
12. INBOUND LOGISTICS Indian skin care industry typically uses specialty chemicals,
such as surfactants, fragrance compounds, polymer compounds and UV filters as active
ingredients. Specialty chemical manufacturers supplying to skin care are adopting „green
chemistry‟ principles to better meet consumer demand for natural and safer products and
increasingly stringent regulatory requirements. Advances in the area of nanotechnology
are helping researchers create breakthroughs in biotechnology.
13. OPERATIONS High R&D expenditure and a large no. of innovations (“green”
chemistry) by the Indian skin care product formulation companies. Some companies are
now backwardly integrated in the skin care ingredients space. The recent market
developments and changed competitive landscape with the advent of large corporations
have contributed to changing the scenario.
14. OUTBOUND LOGISTICS Large scale retail establishments- Department stores ( Big
Bazaar, Visual Mega Mart, Reliance Retail stores .) Supermarkets or self service stores -
Large scale retail shops operating at lower costs, selling at lower price.
(HyperCITY, ApnaBazar, Spencer's, Subhiksha.) Convenience stores or General stores or
Variety stores. Multiple Shops or chain stores. Specialized stores- These are the shops
that deal in only one or two special types of goods. Shoppers' Stop & Globus .
15. MARKETING/AFTER SALES SERVICES Advertising is done through print,
electronic & television media. No after sales services as such- (money-back offer
available for certain product brands)
16. FIVE FORCE MODEL
17. BARRIERS TO ENTRY Low import duty has enabled many international brands to
enter into the domestic market. Competition amongst domestic players to enter the rural
market. (Distribution networks being beefed up)
18. BARGAINING POWER OF SUPPLIERS Some of the companies are integrated
backwards, which reduces the supplier's importance. Manufacturing is largely outsourced
due to globalization, the skin care product distributors in the developing countries are
struggling to capture and retain their market share from the multinational companies.
19. BARGAINING POWER OF BUYERS In case of branded products, there is little that
the consumer can influence, but intense competition within the skin care companies
results in value for money deals for consumers -(e.g. buy one, get one free concept).
20. RIVALRY BETWEEN EXISTING FIRMS Competition is faced from both domestic,
MNCs and also from cheaper imports, which are increasingly visible in urban markets.
Price wars are a common phenomenon. Highly scattered market and poor transport
infrastructure limits the ability of MNCs and national players to reach out to remote rural
areas and small towns. Low brand awareness enables local players to market their
spurious look-alike brands.
21. PRESSURE FROM SUBSTITUTE PRODUCTS The best part in skincare sector is
that the substitutes here are found within the sector itself so if the customers change their
consumption pattern then too the effect will be on the company but the whole sector
remains unaffected.
22. CONSUMER PERSPECTIVE With rising education levels and increased brand
promotion by the personal care manufacturers, the aspirations of the younger generation
have been turning to the branded personal care products. Brand awareness is extremely
high in the urban markets but brand loyalty is very low. In rural markets, the opposite is

3. true. Smaller product packs to attract the consumers (those who are open to experiments
and those who have lower buying capacity).
23. MARKET PLAYER‟S PERSPECTIVE Pricing, brand equity and distribution
network are the key differentiating factors in the skin care market. India, being a big
country, has different demands from different regions. Price wars are forcing many
players to offer discounts and this has reached a stage today where some companies are
launching new products with discounts.
24. MAJOR PLAYERS OF THE SKIN CARE INDUSTRY OF INDIA
25. MARKET SHARE (%) OF SKIN CARE COMPANIES (Basis retail value rsp. ‟09)
26. HINDUSTAN UNILEVER Ltd. Hindustan Unilever Limited (HUL) is India's largest
Fast Moving Consumer Goods Company, with over 20 distinct categories in Home &
Personal Care Products and Foods & Beverages. The company‟s Turnover is Rs. 17,523
crores (for the financial year 2009 - 2010). Major skin care products are: > Fair and
Lovely, Lakme, Pond‟s and Vaseline > Breeze, Dove, Hamam, Lifebuoy, Liril, Lux,
Rexona and Pears.
27. CAVINKARE LTD. In 1983 with a single product, CavinKare started out as a small
partnership firm. The Company that began its journey as Chik India Ltd was renamed as
CavinKare Pvt. Ltd (CKPL) in 1998. Smart marketing and clear product positioning not
only ensured CavinKare's growth but also helped the company broaden its product
portfolio extensively. Major skin care products- > Fairever, Fairever Fruit, Spinz Talc,
Spinz Deodrants,Hi5 Deodrant and Nyle Cold Cream and Lotion.
28. GODREJ CONSUMER PRODUCTS Godrej Consumer Products (GCPL) is a leader
among India's Fast Moving Consumer Goods companies, with Personal and Home Care
Products. GCPL is driven by the mission to continuously enhance the quality of life of
consumers in high-growth markets with its products. Major skin care products are : > Fair
Glow, Cinthol (soaps, deodorants and talcum powder),Vigil & Godrej No.1.
29. EMAMI LIMITED Emami Limited is a coveted Rs 1000 crore business entity, a
leading player in the personal and healthcare consumer products industry in India
engaged in manufacturing and marketing of health, beauty and personal care products
that are based entirely on ayurvedic formulation. Major skin care products of the
company are as follows : > Boroplus antiseptic cream, Boroplus prickly heat powder,
Fair & Handsome, Malai Kesar Cold Cream & Navratna cool talc.
30. SWOT ANALYSIS Strengths 1. Low operational cost. 2. Presence of established
distribution network in urban as well as rural areas. 3. Presence of well known brands.
Weakness 1. Low exports level. 2. „Me-too‟ products which legally mimic the labels of
established brands narrow down the scope of skin care products in rural & semi-urban
market.
31. SWOT ANALYSIS cont. Opportunities 1. Untapped rural market. 2. Rising income
level of consumers. 3. Large domestic market- 1 billion population 4. Export potential.
Threats 1. Removal of import restrictions resulting in replacing of domestic brands. 2.
Slowdown in rural demand. 3. Tax & regulatory structure.
32. CONCLUSION Multinational players with international brands have a strong
presence in the Indian personal care segment. Local brands too are gaining a foot-holding
the market by innovatively developing value offerings to meet the unique needs of the
Indian consumer. Going ahead, it will be important to develop R&D capabilities to
further customize products for Indian consumers, create greater awareness among the

4. burgeoning middle class and ensure effective distribution reach to service them. The
companies that are able to develop a judicious mix of the above will be the eventual
winners. The time is ripe to review one‟s strategy and come up with innovative
approaches to help realize the full potential of the Indian skin care sector.