Posted on : 2022-11-11 02:53:10
Article : Good evening, Friday Management TASK 216- The ecosystem in the beauty industry is now unique and is being driven by consumers, mostly women. The rise in products demand is offering potential opportunities for innovations and new manufacturers entry….
Over the past decade Globally there is a considerable rise in consumers disposable incomes. The growth in global economies, changing lifestyles, rising demands of skin and beauty care products due to varying climatic conditions encourages the growth of the market for cosmetics. A shift of preference towards natural and organic beauty products, particularly in U.S. and European countries fosters the growth of the cosmetics market. Rising demand for natural, herbal and organic beauty products creates potential opportunities for manufacturers to innovate and develop new products in accordance to consumer preferences.
The ecosystem in the beauty industry now is unique. It is being driven by consumers, mostly women, who are curious about new, independent brands and who want to try numerous products before buying. They spend a lot of time in multi brand high-end stores and other retailers who are providing a great environment for new product experimentation. Beauty is one of the few channels right now where multi-brand retailers are still successful.
Selfies and constant picture-taking fascination cause consumers the need to look their best all the time and that's one of the factors encouraging beauty industry growth. Another important source of support for growth are the acquisitions that major beauty companies are making. They are buying relatively large numbers of small brands at values that attract entrepreneurs to sell. Other entrepreneurs see those deals and are motivated to create yet more new beauty companies. This is one of the consumer sectors with such a steady flow of growth, innovation, consumer interest and acquisition activity. Global cosmetics market is expected to garner USD $429.8 billion by 2022, registering a CAGR of 4.3% during the forecast period 2016-2022.
As we enter the start of a new decade, the beauty industry must prepare to take on its biggest role yet. The expectations on brands across all sectors are growing greater but within beauty, consumers have raised the bar for everything from efficacy to ethics and in the year ahead their demands will evolve even further. The beauty industry is in a self-supporting cycle that continues to build and that benefits consumers. No one can say how long all these conditions will remain in place but as long as they do the creativity in the beauty industry will continue. Brands are challenged with building a loyal consumer base among young generations such as Gen Z, while at the same time faced with the difficulties in competing with the wave of agile, innovative smaller brands that are founded on the same values, and strong sense of self-expression of this cohort.
While the industry has traditionally withheld a culture embedded in vanity and luxury which has habitually defined what premium means, today’s status symbols are moving towards characteristics such as health and ethics, which as a marketing message is much easier to convey at any price point. As a result, mass brands have improved on their previous performance, having had the opportunity to narrow the gap between mass and premium by offering quality solutions in accessible ways such as through health and ethical claims. But brands that can communicate authentically, with honesty and simplicity and in a meaningful way will connect with consumers most effectively in the years ahead.
Looking at the promising opportunity by the beauty industry, new entrepreneurs with failures tasted in other field made an entry into cosmetics. With their cosmetics market research and deep understanding of market future needs, they fared well in different countries with different product variants proving that the price points and brand names are not the only one to gain market share. Every entrepreneur should think to bring a new product variant to offer a different experience to the consumer and to grow the market for the product sector. If the business is handled in the way it is planned the failures will be very minimal. We will discuss about few interesting successful entrepreneurs in our coming Monday Management Solution.
Post your suggestive comments on the growth of cosmetics sectors and your related experience with new entrepreneurs in any field to make this case study an interesting business path. We would post our perceptive solution on our Good Morning Monday Management solution for TASK 216 on Monday 14th Nov 2022.
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