According to the French cosmetics giant L’Oreal, it expects the majority of its new business over the coming decade will come from a newly created South Asia Pacific and Middle East market by the company and cosmetics for men will make up a large of the future revenues from that business region .
35 markets across South Asia Pacific, the Middle East and North Africa will be covered in the new and combined geographical zone which is being called internally as SAPMENA. It will have its headquarters in Singapore. According to the region’s president Vismay Sharma, the company created this new region because of the shared consumer trends in the markets within this region as well as the company views this region to have growth opportunities.
“This region, or SAPMENA as we call it … is going to be a major growth engine for us. This is where we will acquire the most number of consumers in the coming decade,” he said.
Sharma said that this new business move is sensible demographically as about 40 per cent of the world population resides in this region and the media age of the population is just 28 years.
“Over 40% of the consumers (in the region) are less than 25 years old,” he said. “That makes it extremely exciting for us and a very strategic market for the future.”
Even though the company did fine during the Covid-19 pandemic, this 112-year-old company is also trying to adapt and adjust to the rapid changes in consumer habits and new markets. The company reported a 10.2 per cent growth in its sale revenues for the first quarter of 2021 which was close the pre-pandemic levels.
However certain categories such as health and wellness and demand for sustainable products have been boosted by the coronavirus crisis, Sharma said.
In recent times, there has also been a surge in demand for male cosmetics. Double-digit growth of one of its male makeup lines in 2020 was noted by the Japanese beauty company Shiseido. This was because of increasing consciousness of male consumers about their appearance as they participated in video conference calls during the pandemic.
L’Oreal expects this trend of demand for male cosmetics to continue going forward particularly in the SAPMENA region, Sharma said.
“In the past, men were not using enough beauty products — so penetration was much lower, the per capita consumption was much lower, the frequency of usage was much lower,” he said.
Now, “particularly in Asia, we can see that men are much more discerning about their skin, about the fragrances that they wear, about their hair,” he added. “This part becomes extremely interesting. In terms of growth percentages, we see significant growth coming from this part.”
He however noted that women will continue to remain the most significant consumer base for beauty products for some time to come.
(Adapted from CNBC.com)