Not Skin Deep

AN upper-middle class drawing room. An Aviance beauty party is on. A trained beauty consultant is meeting four to five upwardly mobile ladies. She is armed with detailed literature on her range of products. She carefully studies the skin types of each of the ladies and suggests skincare regimens from her kit. Her wares are spread out: colour cosmetics like lipsticks, lip pencils, eye colours, foundations. She encourages the ladies to do their own makeovers. Who handle the products with some reserve. The Aviance lady reassures and guides them. In an hour, the ladies have experimented with a range of colours and products. Some may buy a few; the others may think over the range. The atmosphere spells relaxed bonhomie with no compulsion to buy.

Why is Aviance, a newly-floated subsidiary of Hindustan Lever Ltd (HLL), investing so much in a handful of potential clients? Or for that matter, why have the likes of Avon and Oriflame come to India to spend customised time and resource on the Indian woman? The truth is that she has finally arrived as a consumer of beauty products. But she is on the threshold and marketers need to coax, cajole, guide and exhort her to upgrade her beauty regimen, to finetune her choice of products and brands and invest in beauty today for her tomorrow.

In the past five years, the beauty market has grown in dimension and—considerably—in size. While annual sales have posted a compounded growth close to 20 per cent, the market is getting dimension-alised. Once just beauty, there now exist other platforms for products—glamour, health and youth being a few. Health and beauty are getting inextricably linked. Not so long ago, just a couple of brands were available, with Lakme representing the ultimate middle-class aspiration for beauty and skincare. Brands like Shahnaz Hussain and Biotique developed a wide range of products but had limited reach.

But since 1994, leading international brands, including Avon, Revlon, Oriflame, Chambor and L'Oreal, have moved in. Categories have dispersed into focused, concern-based segments. Broad divisions of cleansing and moisturising have given way to cleansing, toning, moisturising, anti-ageing creams, sun protection, anti-blemish solutions, anti-wrinkle creams and 8, 12 and 16-hour creams. "The Indian woman of today believes in investing in products as specific as for fine facial lines and even a separate one for the eyes," explains Lajinder Bawa, CEO, Oriflame. So, there are vitamin eyecreams, footscrubs and intensive foot moisturisers and hand and nail creams for the discerning. Available now is Aviance's pore reducing mask, among the latest innovations internationally. Hair colour products like L'Oreal's hair mascara are finding buyers, prompting companies to encourage trial buys. Oriflame sells its skincare products in sachets and Aviance and Avon welcome trials at home dos. "Our research shows that usage attitudes have changed drastically between 1995 and 1999," says David Gosling, managing director, Avon Beauty Products. Women now use make-up to feel good and confid-ent, while four years ago they used cosmetics to please their husbands. Research shows that usage of cosmetics then was justifiable only after marriage.

With the Indian woman being exposed to what international products can offer, she is getting more demanding. Says Varsha Dalal, executive director, Baccarose, which markets top-end brands like Chambor, Nina Ricci and Escada: "The most commonly used make-up tool was the lipstick. Now it has been transformed into a high technology beauty tool." As Bawa says: "The Indian woman wants not just colour from her lipstick, but moisturising and sun-protection benefits as well." The spiral is then further triggered. Major players are digging into worldwide ranges and bringing in sophisticated products to satiate the growing appetite of the Indian woman . She is daring enough to try out new colours. Oriflame has colours like Shimmer Silver, Shimmer Gold and Blue Freeze, which, Bawa says, are faring well. L'Oreal offers dramatic colours like white, green and blue. Chambor has its international range of stunning reds, deep purples, and burgundy.

But is the picture that rosy? Why then have some players like Benckiser (which marketed the Coty brand) withdrawn? And some others have made little headway even two to three years after joining the race. The fact remains that for all the excitement, these brands account for a fraction of the total market. For instance, while the skin-care segment is worth about Rs 2,000 crore, the premium brands account for just 5 per cent of the slice. They include the likes of Synergie (from Laboratoires Garnier) Pond's Age-Defying Complex, Avon and Oriflame.

IF the Indian woman is a recent cosmetics user, she remains, nevertheless, a savvy buyer recognising value for money, agree marketers. So, pricing plays a pivotal role in making or breaking a brand and is instrumental in the current boom. The regular range of products seems to have nearly doubled. Explains Dalip Sehgal, marketing controller, personal products, HLL: "The real prices of cosmetics have actually decreased in proportion to people's purchasing power." Excise duties are down (from 120 per cent in '94 to between 25 and 5 per cent with Budget '99). Simultaneously, the increase in GDP has led to a nearly fivefold spurt in the Indian family's discretionary income between '94 and '98. Price fluctuation directly affects sales, says Sehgal. For instance, the prices went up in 1998 because of excise-based MRP and they led to a slump in Q1-'98 sales of all personal-care products.

Sehgal may seem a shade gloomier than other—apparently upbeat—marketers. He sees the success of the beauty market hinging greatly on GDP growth. He says many foreign players have been "riding the wave" and while they are pushing their wares, they have yet to make long-term commitments. What happened in Southeast Asia has made them postpone investments till they see visible changes in the economy. A market researcher says such players have made half-hearted investments and tried to test the market by downloading shipments of their popular, international ranges.

Yet, marketers believe that such hiccups are only initial. The Indian woman remains a high-potential client, with her budget for cosmetics being around $0.40, which is a quarter of her counterpart in a growing economy like, say, Indonesia. So even if some players may have called it a day, others are working at making inroads into the buyer's psyche and purse. The two hurdles were lack of retail space and lack of education. HLL is countering this by following the direct-selling route. Hundreds of women are lining up to become beauty consultants (read retail sellers) for Aviance. Avon and Oriflame traditionally sell direct worldwide and have developed retail sales teams. Baccarose is investing in "creating the right retail environment". It now sells through superstores. The savvy marketers ensure lower-end options offset volumes of their ranges of costlier products. Oriflame may have a Rs 490, 8-hour night cream. But it also offers the Vision range of nail colours at Rs 45 a bottle. The fast-moving items like nail colours and lipsticks come for less than Rs 100 a unit. Aviance has colour cosmetics priced below Rs 100 even though its skin rejuvenating cream costs Rs 395.

 The education is paying off and could trigger exponential growth. The Indian woman has added new terms to her cosmetics vocabulary. Her budget for cosmetics has doubled. She is excited and pleased at the attention she gets. It will take time and money till she can understand her beauty needs and chalk out a beauty regimen that suits her. Until then, she can't be brand loyal.

"There is no reason why the beauty mar -ket should be smaller in volume terms than say toilet soap or laundry detergents," says an upbeat Harish Manwani, director, personal products, HLL. His logic: doesn't your skin merit as much care as your clothes? As today's women are being groomed to become cosmetics users, there are over 10 million girls below 18 waiting in the wings and are future buyers. This could take a few years. But, as the marketers who have stuck out so far agree, the wait will be worth its weight in gold.