You will then receive twice a week a short overview of articles recently published by Organic-Market.Info.
Going green to access the Brazilian beauty market
by Redaktion (comments: 0)
Brazil is becoming the darling of the beauty industry, capturing the attention of a growing number of international companies, Organic Monitor reports. Already the third largest in the world, the Brazilian cosmetic & personal care products market is predicted to overtake Japan to take number two position by 2020. However, Organic Monitor research finds not all international brands will be successful because of the peculiarities of the Brazilian market. Brazilians strong affinity to beauty products is well-known. However, what is less understood is that Brazilians are fashion and eco-conscious. GfK research shows that over half of Brazilian consumers consider the environmental impact of cosmetics when purchasing such products, the highest for any country. When Brazilians were asked about the most sustainable firms, Natura Brasil was top of their list. Unlike other parts of the world, beauty has a strong association with green in Brazil.
This is partly because of the strong green credentials of Brazilian beauty firms. Natura Brasil, the largest cosmetics company in Latin America, is widely recognised as the most sustainable beauty firm in the world. It was ranked number 2 in a global survey of the 100 top sustainable corporations (Corporate Knights, 2013). Natura Brasil specialises in natural-based cosmetics, with many ingredients ethically sourced from the Amazon. It has undertaken many sustainability initiatives, and is the only large cosmetics company to become carbon-neutral. Group Boticario, the second leading cosmetics company in Brazil, is also very active in CSR and sustainability. It set up the Boticario Group Foundation for Nature Protection in 1990. The foundation protects over 11,000 hectares of Atlantic Rainforest and Cerrado, two of the most endangered biomes in Brazil. The foundation has donated over US$10m in nature reserve programs, enabling the discovery of 69 new species of plants and animals. Many international cosmetic brands are making investments to take a ‘slice of the growing Brazilian pie’. Not all brands will find success when consumers scrutinize their ethical credentials. Weleda, the leading European organic cosmetics brand, has been successful in Brazil because of its strong green ethos. Multinationals, such as L’Oreal and Unilever, have taken a different approach; they have set up R&D centres in Brazil to ‘localise’ their formulations with indigenous ingredients.
Apart from the ‘green factor’, cultural nuances and distribution are obstacles to market entry. Many cosmetic brands struggle with building distribution in the vast geographies of Brazil. The strength of its network marketing model has been fundamental to Natura Brasil’s market leadership. Group Boticario also takes the direct route via its chain of concept stores. As will be shown at the Sustainable Cosmetics Summit, foreign brands need to take a ‘creative approach’ to market entry and Distribution. In the last 9 months, some of the leading green / ethical cosmetic brands have entered the Brazilian market. The Body Shop has acquired a local competitor to utilise its retail network to market its products. Yves Rocher is opening its own network of concept stores, whilst the Greek company Korres has entered a strategic alliance for network marketing. Realising the importance of ethical consumerism, these brands are dealing direct with Brazilians to inform them of their green credentials.
The marketing and distribution challenges associated with the Brazilian cosmetics market will be covered in the Latin American edition of the Sustainable Cosmetics Summit. Natura Brasil, Group Boticario, Korres Natural Products, L’Oreal (The Body Shop), Johnson & Johnson are some of the cosmetic companies sharing their experiences at the summit. Organized by Organic Monitor, the aim of the Sustainable Cosmetics Summit is to encourage sustainability in the beauty industry by bringing together key stake-holders and debate major sustainability issues in a high-level forum. The 3rd Latin American edition will be hosted at Hotel Novotel São Paolo Jaraguá Conventions on 10-12th September. The summit will be hosted alongside in-Cosmetics Brasil (9-10 September). More information is available from www.sustainablecosmeticssummit.com/Lamerica