Premium Beauty News - Most beauty industry professionals agree on the fact that Brazil is only at the very beginning of its growth in this sector.
Joao Carlos Basilio - We have been experiencing growth rates between 11% and 12% in this segment for almost a decade. And for good reason... If one considers only the last five years, more than 40 million people (including women!) have advanced from a precarious state to the one of empowered consumers with enough purchasing power to buy "something else" than just food. A "boom" that the whole perfume and cosmetic industry is fully benefiting from, with, still in full swing, the door to door sales sector but also, and this is new, the distribution sector undergoing profound changes with new brands gaining access to the market through the development of new shopping centres and a very dynamic parapharmaceutical sector.
As a result, major European or American brands are no longer hiding their intentions of setting foot here. Not to mention many new Brazilian brands that emerging here and there.
Premium Beauty News - Those well-known foreign brands are only entering the market now?
Joao Carlos Basilio - Some of them, yes. Because to enter the Brazilian market, brands had to be aware of the necessary adjustments they had to do in their formulas, for their products to be able to cope with the Brazilian climate and the different skin types we have in Brazil. For example, a foundation powder or a cream made in the United States or in Europe are not suitable for Brazil. You must also add the fact that the Brazilian tax package is too complex to be administered, which makes it difficult to access these different markets.
Premium Beauty News - It is true that volumes have what it takes to make manufacturers’ mouths water! Among the latest anecdotes to date, the one referring to the sale of some 70 million bottles of nail polish in just one month, just before the last summer holidays...
Joao Carlos Basilio - But this doesn’t stop at nail care The face, eyes lips are also the brands core strategy in our country. It must be said that for the eyes, the market development is impressive. Not to mention perfume!
Premium Beauty News - The ABIHPEC of which you are the President is, by far, the sector’s main professional organization!
Joao Carlos Basilio - The largest in fact, with 300 member companies representing 94% of the Brazilian market of the health and beauty sector who generate a turnover of more than USD 17 billion. In this figure, hygiene products have a share of 57%, followed by cosmetics (27.5%) and perfumery (15.5%). The growth rate should again be at least of 10% in 2012 compared to last year.
Premium Beauty News - You were already talking about it, things are changing in the distribution sector.
Joao Carlos Basilio - That’s right! The famous Brazilian exception of "door to door" sales is changing. It remains strong and is still developing but new circuits are emerging like the one for example of drugstores and shopping centres where we can see appearing here and there some specialty shops. You also know that Sephora has announced it had made plans to set foot on the Brazilian market.
Premium Beauty News - An important development for a market which is opening up to other brands?
Joao Carlos Basilio - This indeed can only but encourage the opening of the market to new brands and new products. In fact, some well known Brazilian brands specialized in door to door selling have grasped this opportunity to develop new concepts and new points of sale.