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Selling youth a roaring biz

Last updated on: November 29, 2010 14:28 IST

Selling youth a roaring biz

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Preeti Khicha in Mumbai

Nivea is the latest entrant in the Indian anti-ageing market with a slew of premium products under the Nivea Visage brand umbrella.

Launched in India earlier this month, Nivea's line-up will feature three primary sub-brands Q10 (day cream, night cream and eye cream), DNA Age (day and night cream) and Aqua Sensation (face wash, day and night cream).

Nivea says the new range is placed well to take aim at two segments with its offerings the populous youth and the ageing baby boomers.

Nivea is in good company as many others have jumped on to the bandwagon to tap the Rs 3,400 crore skin care market that is growing at 13 per cent, with some segments like anti-ageing faring better than others.

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Image: Nivea.

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For example, the most recent addition to L 'Oreal Group's Indian portfolio is Kiehl's. The Kiehl's brand will not only introduce its vast range of skin care products, but most significantly brings its ultra-premium anti-ageing offerings to the country.

Kiehl's launch will strategically complement L'Oreal's other brands like L'Oreal Paris and Lancome, which also offer anti ageing products.

"For our luxury skincare brand Lancome, our main forte in terms of sales is anti-ageing and we have a vast range of product offerings in this category," says L'Oreal Group, chief operating officer, Dinesh Dayal.

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Image: Kiehl's products.

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Given the positive response of the market, Lancome is also planning to introduce the Absolut range which has more specialized anti-ageing products.

"These are serums which have just been launched in the West, but we will bring them to the Indian market early January," says Dayal.

L'Oreal Group over time has built a portfolio of brand offerings  across multiple price points.

Hindustan Unilever too launched the Ponds Gold Radiance range last month to take on Procter & Gamble, which is the market leader in the anti-ageing segment.

P&G sells 'Olay Total Effects' with prices starting from Rs 599.

Ponds Gold Radiance, priced between Rs 500 and Rs 1,000, will be on top of the heap of HUL's skincare products as far as premium positioning is concerned.

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Image: L'Oreal store.

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In 1995, L'Oreal entered the Indian skincare market with Garnier Wrinkle Lift, under the Synergie brand name.

The launch was noteworthy as at the time fairness creams and cold creams dominated most companies' portfolios.

Garnier Wrinkle Lift was priced at Rs 95.

"Our Garnier brand of anti-wrinkle cream was enthusiastically received here. This made us believe that we could make a tangible difference to this niche segment of anti-ageing products. So we built here a whole range of franchises including Lancome, L'Oreal Paris and Kiehl's," says L'Oreal's Dayal.

Later, Garnier extended its anti-ageing product range to Garnier Age Lift which is priced between Rs 250 and Rs 400.

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Image: Pond's products.

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Selling youth a roaring biz

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The flurry of launches in the premium anti-ageing cream market is understandable.

As Kline & Company analyst Anna Ibbotson explains, "Consumers are now demanding products with improved functional benefits, for example a conditioner designed to reduce frizziness of hair or skin products with anti-ageing properties."

While the anti-ageing segment is still small at Rs 150 crore or Rs 1.5 billion (according to Nielsen estimates), it has witnessed double digit growth (40 per cent) in the past year.

According to research done by Kline, India's market for personal care products is set to grow significantly. In the past, the skincare market was driven by price sensitivity.

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Image: Beauty products.

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However, the surge in disposable incomes and greater product awareness has led to an increase in consumer spend on premium and specialised products.

As KPMG Analyst (consumer) Anand Ramanathan explains, "Today, people are not concerned with just the price point. Consumers will buy a skincare product if they see value," he says.

Wider reach

In terms of growing the 'keep-me-young' category, Dayal says, the key lies in educating the consumer.

The next challenge is making category classifications less confusing -- there are so many choices for different skin types that consumers don't know what product is best suited for them, let alone which brand.

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Hence, in such a small and yet crowded category, marketers face the unique challenge of differentiating their products.

To bridge the gap for confused or unaware consumers, brands like Lancome have begun offering personalised experiences at various locations.

"We have a beauty cocoon in our Lancome boutique in Mumbai where consumers can come and experience treatments. Also, we focus on CRM where we connect with consumers through direct mailers and one-on-one calls," says Dayal.

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Image: A lancome store.

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Nivea too is focused on educating consumers about the benefits of anti-ageing. It will initially push its products through niche channels like speciality chemists and through shop-in-shop outfits at the HyperCity mall.

"We believe that the product advisors at the Nivea outfits are the face of our brand and we are investing heavily in training them," says managing director, Nivea India, Kai Boris Bendix, After all, he believes, they are the ambassadors who will educate consumers about Nivea's products.

Today, what fairness is to India, anti-ageing is to the Western world. However, slowly the Indian market is evolving.

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Image: Nivea products.

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Today, working women are not the only ones flocking to skin care items. "Younger consumers too desire products that offer prevention rather than only treatment," says Dayal.

Meanwhile, Nivea does not intend stopping with the launch of its current anti-ageing range.

According to Bendix, Nivea has a larger portfolio of anti-ageing products globally, and if this range is a success, the brand will introduce the ultra-premium range in the near future.


Image: Nivea cold cream.

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