BW Confidential - Issue #6 - May/June 2011 - (Page 66)

Last word Guest column Looking ahead In our guest column, US-based brand design agency LPK Beauty vice president group creative director Liz Grubow analyzes the next big trends in Asia and how the industry should interpret them credit: istock • Emerging players Along with China the emerging economies of Indonesia, Thailand and South Korea are increasingly powerful players in the market, as increased standards of living drive spending on beauty products. While the major brands survey these markets for opportunity, they face substantial competition in markets saturated with domestic brands and in cultures where localization and sensitivity towards regional differences in language and religion still play a critical role in establishing relevance. Indonesia’s beauty industry is exhibiting an increased demand for imported cosmetics and personal-care products, growing at an annual rate of 10-15%. In South Korea, domestic manufacturers like Amore Pacific and LG Household continue to assume a superior position and we’re seeing them emerge as trendssetters as they extend their influence to China. • Traditional beauty ideals Flawless, porcelain skin is the gold standard of beauty, helping to keep skincare products at the forefront of innovation and spending. Skin whitening products are increasingly prevalent in the beauty routine, expanding from skincare into other personal-care products. Multifunctional formulas that combine skincare benefits with sun protection, anti-aging and cosmetics are increasingly popular at mass, such as the BB cream that is widely used as a foundation. Global brands such as Olay and Lancôme, are creating awareness in anti-aging by leveraging cosmetic science, particularly “gene-repair” related innovations. There is also a boom in cosmetic surgery among a younger demographic and their parents. While Korea is still the most popular cosmetic surgery market, China’s is expected to grow in the next decade. 66 Major brands face substantial competition in emerging markets saturated with domestic brands and where sensitivity towards regional differences still play a critical role in establishing relevance LPK Beauty vice president group creative director Liz Grubow “ pearl protein and algae. Formulas elevating the sensory experience, such as shampoos with menthol that give a tingling sensation can signal effectiveness. Brands based on traditional medicine are seeing strong growth. The use of unusual plastics or finishes delivers a level of detail and delight on shelf. Among lower-tier consumers, packages that are easy to share with reusable attributes help reinforce brand value and establish loyalty. We’ve seen a need for brands to refresh themselves to capture the attention of Asian beauty consumers. They expect quality materials, value decorative finishes and will spend more for items that they see as higher quality. • Evolution of retail & future growth • Sensory experiences Every aspect of using a product—the touch, finish, design, scent—establishes a unique brand experience for the consumer. Among lower-tier consumers scent can reaffirm a product’s continued efficacy. There is an increased demand for naturals that drive “authentic” formulations with ingredients associated with either traditional medicine practices or health or cleanliness perceptions, such as green tea, ” Traditional kiosks and “mom and pop” stores still dominate retail, but they are declining with the expansion of modern retailers and convenience stores offering a wider selection. Direct sellers that leverage sampling, and an experience that provides education and community are gaining ground, mainly among lower-tier consumers in urban and rural environments. Men are fueling the demand for men’s cosmetics, personal-care products and skincare across Asia. They are also seeking professional help from spas and salons. While China has the most salons, Indonesia is is becoming associated with the spa industry. While skincare continues to characterize the market, cosmetics should also grow as more global brands launch in mass and competition for professional jobs and compensation are increasingly linked with appearance. n Liz Grubow has led brand identity programs for leading beauty brands including Pantene, Olay, Max Factor Intl and Cover Girl. Grubow often lectures and consults on regional and global branding issues in skincare, haircare and beautycare in North America, Asia and Latin America. May-June 2011 - N°6 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #6 - May/June 2011

Cover
Comment
Contents
Update
- Brand & retail news recap
- Digital digest
- Companies on the move
Take note
- Market facts, figures & trends
Best of BW
- Highlights from our e-publication
Launches
- The latest in fragrance, skincare & make-up
Interview
- Puig ceo Marc Puig
Insight: Skincare
- Category overview
- Department store initiatives
- Perfumeries
- The latest trends
Wellness
- Discounting in spas
- Spa case studies
Retail
- New store concepts
Travel retail
- Market analysis: Asia & Middle East
- Chinese travelers
Radar
- Four up-and-coming beauty brands
Market watch: China
- Analysis: country overview
- Industry roundtable
- Prestige retailing
- E-commerce
Packaging
- Decoration techniques
Last word
- LPK Beauty vp group creative director Liz Grubow

BW Confidential - Issue #6 - May/June 2011