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Markets & trends

Evaluating requisites and desires of the growing skin care products market

The world is raging with the inflow of more than a million skin care products. Making a choice between the available packages, with each one of them claiming to be highly effective and deliver the best results. Most manufacturers market their products as effective against common skin ailments such as blemishes, breakouts, tanning, and infections. The desires of the global masses differ due to demographic and cultural variation. When one part of the world would want to turn several shades fairer, natives from the other parts would want to tan under the natural sun. Apart from the consumers, manufacturers of different sizes of operation adopt different perspective and route for growth in the skin care products market.

The global skin care products market is bound to attain the $179 billion revenue mark by 2022. Asia-Pacific contributes the maximum share of revenue to the global roundup value. Photo: © Elwynn / shutterstock.com

The global skin care products market is bound to attain the $179 billion revenue mark by 2022. Asia-Pacific contributes the maximum share of revenue to the global roundup value. Photo: © Elwynn / shutterstock.com

Geography-based demand

There is a standup geographical demand for skin lightening or skin whitening creams and lotions at and along the equator. While the residents of the colder parts of the earth and those in gulf locations exhibit a significant affinity to tanning lotions and sun protect respectively. All geographies combined, the demand figures for sunscreen lotions and creams hold a dominant share of the overall revenue in the industry. This disparity of demands among the consumer populace are more of brownie points rather than a business hurdle. It has provided the vendors with enough freedom to maintain an economical balance in their choice of ingredients for product composition. Going by the figure, Asia-Pacific contributes the maximum share of revenue to the global roundup value.

Between desire and compulsory

There is a thin divisive line in between the desired and the healthy. As a fact, skin is the largest organ of the human body which adds the first tier of protection against foreign particles and bodies. A good skin care regime for the entire body is necessary for every human to maintain overall health. There is a dire need for a typical shift from cosmetic skin care products that only aim at temporary lightening or brightening of the skin towards more natural products that nurture the skin from within the deep layers. As per market figures, a considerable mass of global population is experiencing the necessary shift at present. However, a majority remains to overcome their economic limitations and spare a part of their expenditures on effective skin care products.

Socio-environmental restraints

In addition, the product developers face intense pressure from the social and environmental activists that do not agree with either the publicity agenda or the constituent elements of their offerings. There have been campaigns across social media and internet pinning down that there being “fair and lovely” is not a requisite. In other instances, the environmentalists have raised their concerns against the use of constituents derived from exotic animals or plastic compounds for delivering “enhance beauty.” In latest news, the industry witnessed a ban on the use of microbeads as a scrubbing agent, citing it unnecessary and a menace to the environment at large. While some of the voices against the industry operations are conveniently tuned down because of their non-relevance, there are several others for which the industry has prepared an action plan.

Strategic ingredient for success

Manufacturers in this industry segment have their priorities set on catering to the core consumer desires, over their needs. The range of products that attend to the needs of a healthy skin are made available at higher prices than the rest. Prominent companies, such as Avon, Estee Lauder, and L’Oréal, have a committed base of buyers, their trust tagging along to the brand value of the products. Successful brands with high market value share the same history of teaming up with healthcare professionals and skin care experts to obtain primary customer reviews and resolve a common fix to their issues. They have leveraged strategic business acquisitions and mergers to capture the product lines with promising market potential.

Taking it from small to large

Small companies that venture out to introduce similar line of cosmeceuticals get a hold of local market easily but face a tough time making it big in the global commercial interface. Low marketing budgets and modest ingredients along with limited scope for research facilities for product development are the core restraining factors that make it difficult for small- to mid-sized manufacturers from shining solo. There exists a limited number of small names in the skin care products market that have managed to be consistent in their product quality, reputation, price, and yet managed to emerge as winners on global platforms. For the others, partnership with the pharmaceutical giants brings them an opportunity to improvise and enrich their portfolio. In addition, a sturdy advertising and marketing strategy helps them get recognized as a brand name. Although, seldom is the case when the prices have not hiked up post the strategic acquisition of these manufacturers.

Low price, better margins

On a comparative note, the leading names in the skin care industry have felt the pulse of the regional markets. They realize that there is an opportunity to build remarkable profit margins within low-price range products. Simple compounds go into the making of these products as compared to the trademark complexes used in high-range alternatives. Low consumer expectations and the unquestioned trust on brand name helps garner remarkable profits. A sequence of latest product launches indicate that they are wary of not being able to capture the participation from midrange income consumers. These users comprise the population segment, which does not look upon skin care products as necessities to their lifestyle. With the introduction of low-priced products, the prominent industry vendors aim at inculcating a habit among their users, which can be leveraged to lure them into active participation across all market segments.

According to the findings of a latest market research, the global skin care products market is bound to attain the $179 billion revenue mark by 2022. Business analysts predict the industry to grow at a CAGR of 4.7% over the rest of the forecast period 2016-2022. Adaptability and agility in response to consumption pattern aids the completion of set targets for the global industry.

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