“Our company was born in Brazil 46 years ago but we only arrived in the Colombian market 8 years ago,” said Axel Moricz de Tecso, the general manager for Natura’s Bogota-based Colombian operation.
“We came here because of the size of the market, but also because of consumers that can challenge us. Consumers here are sophisticated and know a lot about all areas of cosmetics. They know a lot, and demand a lot so it is a good market to stretch our capabilities.
“As a company we have learnt a lot by entering this market. Personally I have worked here in Colombia, as well as in Chile, in Argentina and within that context Colombians are sophisticated consumers.”
Colombia emerges as a regional hub for Natura
The company has created a manufacturing hub in the country, with two contract production facilities in Medellin and Manizales, but the company still does not source ingredients in the country yet, although it is an aim.
“We work with Amazonian ingredients, but they do not come from the Colombia Amazonia, yet. That is mainly because regulations do not allow it just yet, but the government is now showing interest in making this happen and as a consequence it is currently looking to amend regulations in an effort to encourage ingredients sourced in this country,” explained Moricz de Tecso.
“There is no reason not to source ingredients here. We can source ingredients here in Colombia in a sustainable way if we find a regulation that allows us to do that in the way we do it in Brazil, which is responsibly, sustainably and in a way that looks after local communities.”
Serving the Peruvian and Mexico markets
The move into Colombia has also proved strategic as a way of tapping into other markets in the region that are culturally and economically similar to Colombia which means there are shared trends for demands in products, as Moricz de Tecso explained.
“We produce almost 30 – 40% of what we sell here in Colombia and on top of that we also export to both Peru and Mexico. Although we have our biggest production facilities in Brazil, as well as in Mexico and Argentina, Colombia has become important for the manufacture of body treatment and fragrances.”
Although the strategy to target consumers in Colombia is the same as in Brazil, Moricz de Tecso explained that Colombia, alongside Peru, has proved to be its biggest market for direct sales, accounting for approximately 40% of total sales.
This figure compares to approximately 20% from direct sales in Brazil, underlining that the retail culture in Colombia is quite different, with many women preferring to buy their cosmetics from neighborhood friends or family.
“But despite this, the strategy principles are the same as in all markets, particularly in the way we interact with our suppliers, retailers and communities in general. It is always Natura’s intention to be respectful of the environment and take care of people…and of course, to provide good quality products,” Moricz de Tecso explained.
Strategy to build on market share
Right now the company has a respectable 4% of the market, but Moricz de Tecso believes that further success will not be built by continuing to develop the direct sales strategy in Colombia.
“We need to think that direct sales may not be the way in the future. So we have to look at online as an integral part of our business, but it is always our intention to respect our customers to make their life easier.
“Ultimately I would like to be at the top in the Colombian cosmetics market, but we have big competition here, particularly from Belcorp so our goals will not be achieved over night.”