Rivalry among existing competitors Industry growth The personal care industry had an excellent growth rate in all the major markets of the world in 2005-2006. Since the past few years, people have become more conscious about their appearance and look, leading to a huge demand for these products in the whole world. New products are launched by the leading brands to attract consumers. The trends in all the leading personal care markets show that this industry is showing a massive potential for growth. The women’s beauty industry is growing at rate of approximately USD 202. 54 billion every year where as the global market for cosmetics alone USD 30. 33 billion. The global personal care products industry is growing at a very rapid pace; some of the factors responsible are: •Rise in consumer spending power, •Increased demand due to people consciousness, •Key demographic factors, •Entry of herbal and organic products, •Lifestyle and climactic changes, and •Massive advertising and promotiom strategy France The personal care product market in France is becoming more diversified and fragmented. In the year 2006 the personal care industry in France grew at the rate of 2. %, earning a revenue of USD 1,151. 34 m according to the Federation des Industries de la Parfumerie. The largest share among all the personal care products was of body moisturizers, with sales of USD 361 m, which was 2. 4% more than the previous year. Germany The German personal care market has shown a rising trend in the year 2006 with a total sale of USD 983 m as reported in IRI Germany at the rate of 3. 7%. In Germany the most popular personal care products are Gels, Lotions, moisturizers and creams. Italy According to the ECM calculations by Unipro, the Italian market figures for otal sales of personal care products were USD 1,186. 15 m in 2006, which was above 6. 3% than the previous year. Spain Due to increasing awareness about personal care and beauty, a large number of Spanish people are demanding good quality personal care products, which has led to a growth in the development of this industry in Spain. Body lotion and body oil accounted for the largest share among other body care products. United Kingdom According to a study by TNS Worldpanel, the personal care industry in UK had the total sales of $312. 77m in 2006, which was 9% higher than the previous year. United States of America
Anti-aging creams and lotions have a huge demand in USA, and these products are pushing the rate of growth of this industry in this country. In USA, the personal care products market is almost USD$40 billion and according to estimates it will grow at the rate of 3. 4% annually. Russia The Russian personal care market continues to grow and in several aspects, according to some marketing specialists, doesn’t conform to the European models. Brazil The personal care industry in Brazil is the sixth largest in the world, and had the sales of US$9. 19bn in 2006, which is up 13. 6% from $8. 09bn in 2005.
Figure 2: Growth in Personal Care Industry in 2006 Body care products claiming to firm, tone and lift offer consumers a quick-fix solution for body woes. The industry turns over $100 billion every year & the cosmetics market alone is worth more than $15 billion worldwide. The UK market is worth $6. 2 billion with a +5. 3% growth rate. People in the UK spend on average $2,000 a year on beauty treatments & cosmetics. The cosmetics market is expected to be worth $351 million by 2009. Total expenditure on male grooming products in the is expected to reach $1. 5 billion by 2008. Spending on own-label personal care products rose to $7. billion last year. The global personal care products industry is growing at a very rapid pace; some of the factors responsible are: •Rise in consumer spending power, •Increased demand due to people consciousness, •key demographic factors, •Entry of herbal and organic products, •Lifestyle and climactic changes, and •Massive advertising and promotiom strategies. Degree of products differenciation The major demand is for the products that are of basic need for the consumers like soap, shampoo, hair oil etc. The personal care products industry consists of four major sub-sectors manufacturing a range of products.
These sub-sectors and their products are highlighted below: •Face Care Products- Face is the reflection of an individual’s physical appearance. Generally, the beauty of a person is described by the look of one’s face. Thus, to enhance the beauty of the face people use face care products whose market is growing at double digits. The industry manufactures products like astringent, face cream, face scrub, face toner, moisturizer, cleanser, etc. Some of these products are used for clarification and purification of the facial skin from dust and harmful rays of the sun while others are used for toning. Hand and Foot Care Products- As the name suggest these products are used to enhance the beauty of hands and feet. The hand and foot care product market segment, grew 5. 9% in 2005 to a total of 338. 2 million dollars, and included many successful product introductions. These included herbal and organic products, as well as products for youthful skin. Men are also starting to take better care of themselves, resulting in growth in the men’s foot care products market segment. Hand and foot care products can be broadly categorised into cuticle care products, foot scrub, hand and foot cream, nail care products etc.
The diagram below shows the various market segments: Figure 1: Global Market (segment) share in % •Hair Care Products- Hair care was the largest market segment, both in 2004 and in 2005 with sales reaching 350 million dollars. The price war has had its impact on the shampoo and styling categories. Sales in hair coloring products has stabilized while hair conditioners and hair repair products, showed significant growth. Consumers are willing to buy special, more costly, products because these products are used for many purposes like hair cleansing, hair conditioning and hair coloring.
Some important hair care products are mentioned below: oHair Shampoo oHair Conditioner oHair Oil oHair Styling Gel oHair Glaze oHair Spray oHair Colors •Cosmetics- The global cosmetics market continues to benefit from a combination of strong macroeconomic trends creating opportunities for new product niches. The strongest growth in the global cosmetics market in 2005 was derived from developing regions such as Eastern Europe and Latin America and key markets in Asia-Pacific, with expansion linked to large populations, rising disposable incomes, modernising retail and distribution networks and increased industry awareness amongst consumers.
Cosmetics are items to enhance or protect the appearance or odor of the human body. The products included in this category are: oEye makeup product oFace makeup product oLip makeup product Brand identity The visible elements of a brand (such as colors, design, logotype, name, symbol) that together identify and distinguish the brand in the consumers’ mind. Brand identity stems from an organization, i. e. , an organization is responsible for creating a distinguished product with unique characteristics. It is how an organization seeks to identify itself.
It represents how an organization wants to be perceived in the market. An organization communicates its identity to the consumers through its branding and marketing strategies. A brand is unique due to its identity. Brand identity includes following elements – Brand vision, brand culture, positioning, personality, relationships, and presentations. For personal care industry : Exit barriers Barrier to exit (or barriers to exit) refers to the challenges faced by companies, which find it tough to withdraw from a particular market, especially after realizing that it is hardly profitable.
Player recedes to the lowest position in market. Profit made by the incumbents of market are comparatively lower. The factors that resist an exit from a market include lack of ways to obtain profit from the assets, in which investment has already been made. Personal care services have low barriers to exit. Threat of the new entrants Absolute cost advantages Competitive advantage that a firm or a country obtains through cheaper inputs, innovation, proprietary know how, waste minimization, or other such means resulting in lower average costs. See also acquired advantage.
In the personal care industry there is no absolute cost advantage except a t an innovation level . For example some groups are dedicating a lot of fund for researsh and developement ( for instance L’oreal ) As a matter of fact it can be a absolute cost advantage. Proprietary learning curve As a company moves along a product (or process) path, knowledge is accumulated. Since most innovation is a rearrangement of existing knowledge units, the company is able to further innovate, and therefore move quicker, along this chosen path. Companies that have developed a knowledge base in their industry make it difficult for a new entrant to compete.
On the personal care industry the market is already established but not closed, however the supremacy of the major companies and according to their proprietary learning curve makes it more difficult for small businesses. The personal care insdustry can still offer some niche market . Economies of scale Reduction in cost per unit resulting from increased production, realized through operational efficiencies. Economies of scale can be accomplished because as production increases, the cost of producing each additional unit falls. Economies of scale
Why Work with Us
Top Quality and Well-Researched Papers
We always make sure that writers follow all your instructions precisely. You can choose your academic level: high school, college/university or professional, and we will assign a writer who has a respective degree.
Professional and Experienced Academic Writers
We have a team of professional writers with experience in academic and business writing. Many are native speakers and able to perform any task for which you need help.
Free Unlimited Revisions
If you think we missed something, send your order for a free revision. You have 10 days to submit the order for review after you have received the final document. You can do this yourself after logging into your personal account or by contacting our support.
Prompt Delivery and 100% Money-Back-Guarantee
All papers are always delivered on time. In case we need more time to master your paper, we may contact you regarding the deadline extension. In case you cannot provide us with more time, a 100% refund is guaranteed.
Original & Confidential
We use several writing tools checks to ensure that all documents you receive are free from plagiarism. Our editors carefully review all quotations in the text. We also promise maximum confidentiality in all of our services.
24/7 Customer Support
Our support agents are available 24 hours a day 7 days a week and committed to providing you with the best customer experience. Get in touch whenever you need any assistance.
Try it now!
How it works?
Follow these simple steps to get your paper done
Place your order
Fill in the order form and provide all details of your assignment.
Proceed with the payment
Choose the payment system that suits you most.
Receive the final file
Once your paper is ready, we will email it to you.
No need to work on your paper at night. Sleep tight, we will cover your back. We offer all kinds of writing services.
No matter what kind of academic paper you need and how urgent you need it, you are welcome to choose your academic level and the type of your paper at an affordable price. We take care of all your paper needs and give a 24/7 customer care support system.
Admission Essays & Business Writing Help
An admission essay is an essay or other written statement by a candidate, often a potential student enrolling in a college, university, or graduate school. You can be rest assurred that through our service we will write the best admission essay for you.
Our academic writers and editors make the necessary changes to your paper so that it is polished. We also format your document by correctly quoting the sources and creating reference lists in the formats APA, Harvard, MLA, Chicago / Turabian.
If you think your paper could be improved, you can request a review. In this case, your paper will be checked by the writer or assigned to an editor. You can use this option as many times as you see fit. This is free because we want you to be completely satisfied with the service offered.
Effortlessly get the essays and grades you need. You can now get any essay, on any subject and at ANY deadline with just 10 minutes of your time (or less). Your professor will love you for it!