Japanese cosmetics players creep up on global rivals
by up-and-coming Japanese players - who are slowly but surely
rising in popularity, according to a new report.
The recent Euromonitor report, 'Could Western beauty firms be under threat?', posts worrying figures for Western multinationals, as many Japanese firms creep up in the list of top ten ranking personal care players. The global cosmetics and toiletries market is getting progressively more competitive as companies battle to remain in the top ten ranking, reshuffle brand portfolios and make more acquisitions and mergers in order to target a wider audience and reposition themselves nearer to the top. However, the most notice shifts have come from emerging markets such as China, Brazil and Russia, which is helping to redefine the face of the global market. Many Japanese players have managed to successfully tap into this trend, particularly by targeting the China market, to which it is more closely connected to, both culturally and geographically. Japanese cosmetics player Kao became a top ten ranked company for the first time last year, knocking German based Henkel out of tenth place, after driving up its global market share to nearly three per cent. The company edged in by one percentage point following the successful acquisition of Kanebo cosmetics, and was also helped by a strong and steady economic recovery in their domestic market, which has been tipped for further growth in the future. Sales of beauty products rose by almost three per cent in Japan, a rise predicted to hold until 2010, a key factor to the growing interest in Japanese products. However, with previous worries that the Western cosmetics market has reached its peak after being over-run with competing manufacturers, the robust spending profile of the Japanese consumer could further boost the position of Japanese cosmetics players in a domestic market that is difficult for foreign companies to penetrate. Despite Kao being only one of two Japanese company in the global top ten ranking - the other being Shiseido - both firms are thought to have strong growth prospects and are pushing into overseas markets to capitalise on booming markets, particularly China, to continue to consolidate their leads at the top of the industry. Many emerging markets players are also beginning to challenge the strong Western hold over the cosmetics industry, with Brazil's Natura cosmetics company pushing forward at 16th place from 2005, where it stood at 22nd. The direct seller has benefited from huge growth in its home market that has enable it to become the leading supplier and, following this success, is planning to 'develop a broader global reach'. Likewise Russia's Kalina and Faberlic are also expected to expand into the global marketplace, backed up by encouraging signs from smaller players in this fast-growing market. However, it is still the Western Manufacturers that are holding court - with Johnson & Johnson being the biggest mover in 2006 after Kao, and L'Oreal and Procter & Gamble still firmly holding on to the top positions.