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Maybelline seeks to crack the beauty code

Nielsen data show that the L?Oreal group brand is fourth after Lakme, Elle 18 and Revlon. Can it break into the top three?

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It began with a provocatively titled headline — WTF — in January this year. But by the end of it, (or WTF) was the most popular topic on Facebook and Twitter, with men as well as women voicing their opinions on the subject, even taking potshots at each other whenever the opportunity presented itself. This, however, was just part of what New York, the cosmetic brand from French major L’Oreal, had in mind for its new Clearglow Bright Benefit or BB Cream — a product that combines the benefits of a foundation, sun block and moisturiser.

Dare To Go Nude was the next part of this campaign, which was nothing but the launch phase of the BB Cream, where Maybelline was effectively providing a solution to the age-old problem of women taking forever (in getting ready, that is), by suggesting there was an alternative available.

“We wanted to highlight the benefits of the product in an ingenious manner,” says , marketing manager, Maybelline. “Digital is something that we use aggressively besides print and outdoor. We do not use TV. So we thought why not leverage the online medium in such a way that it creates a movement.”

SHARE OF PLAYERS
Brand  Value (%) Volume (%)
2010 2011 2010 2011
22.5 17.7 3.7 2.6
10 11.3 5.4 5.1
6.5 4.2 1.1 0.7
Maybelline 2.1 2.5 0.3 0.3
Street Wear 1.4 1.1 0.3 0.4
L'Oreal 1.0 0.4 0.1 0.0
Source: Nielsen; Data for All India Urban for categories lips plus nails in traditional trade

The viral campaign for Clearglow, which went on through January and February, is amongst a series of initiatives that Maybelline is taking to cement its position in the over Rs 1,000-crore organised make-up market in India. While Lakme, Elle 18 and Revlon occupy the one, two and three positions, according to Nielsen, which tracks only the segments of lips and nails in traditional trade, Maybelline is at number four. (See Table)

We are number two
Guha insists that Maybelline is actually number two if modern trade is also taken into account. “Nielsen does not track modern trade nor does it cover face and eyes, which are big make-up categories,” she says.

While analysts say that modern trade is a big channel in cosmetics, contributing almost 25 per cent to the topline of companies, shaking off Unilever and Revlon may still not be easy.

The reason being distribution. Both Unilever and Revlon have been around longer than Maybelline has with an overall reach far more than the latter’s.

Consider this: The total store universe in cosmetics is about 25,000-30,000. This include pure-play cosmetics stores, health & beauty outlets, department stores, hypermarkets, high-end general stores etc. Much of the known brands fight for a presence in these outlets. Now Unilever thanks to its strong distribution network is present in almost all of these. Revlon, according to market experts, is there in about 2,000-5,000 outlets. Maybelline has a presence in about 1,000 stores.

“So if Maybelline has to pose a challenge to the bigger boys ramping up distribution will be critical,” says Anand Ramanathan, associate director, KPMG.

This point is endorsed by Arvind Singhal, chairman of retail consultancy Technopak. “Much of the international brands are still niche, in the sense that their reach is limited. Spreading out will take some time,” he says.

Banking on the middle class
But brands such as Maybelline are banking on the aspirations of middle-class Indians with products that are international in appeal and reasonable in price.

An average Maybelline product is available at Rs 175 — lower than a Chambor, Revlon, L’Oreal, Lakme and Colorbar — but higher than Unilever’s Elle 18 and Street Wear, which is marketed by Win Medicare, who also sell Revlon.

Market experts say that this pricing strategy — with Maybelline sitting between budget (Elle 18/Street Wear) and premium (Revlon, L’Oreal, Chambor, Lakme) brands — is a clever one. “That is because it can still drive premium imagery at a price point lower than many other imported brands,” says Pinakiranjan Mishra, partner & national leader, retail & consumer products, Ernst & Young.

But rivals point out that lack of local production will not help the L’Oreal group in taking price points further down. The French major, unlike Lakme or Revlon, does not manufacture any of its make-up products in India, though skin care, hair care and hair colour products are made here. Company executives say there are no plans to get into local production of cosmetics at this stage.

The group instead is focusing its attention on studying the market and identifying trends that it can quickly capitalise on. Experts say that most international brands that are imported into India are beginning to focus on innovation to drive interest in their products.

Maybelline, for instance, has some interesting concepts — such as a kajal pencil that can be conveniently twisted up and down like a lipstick without causing much damage or wastage. Most other kajal brands are yet to have something like this. It also has a compact powder that doubles up as a foundation cream when wet or a lipbalm that is fruity flavoured that also takes the colour of the lip.

Guha says that there are more products in the offing including gel eye liners and shine lipsticks to perk up its portfolio.

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