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India Cosmetics Market Outlook

India is a price-sensitive economy, therefore cosmetics and personal care products businesses, particularly novices, would have to devise revolutionary new tactics to cater to Indian inclinations and wallets in order to get a foothold in the market and carve out a position for themselves. Improving spending power and growing trend awareness of the Indian people have fueled the Indian cosmetics business, with major participants investing extensively on promotional initiatives to raise customer awareness and enhance their offerings. Forest Essentials, Biotique, Himalaya, Blossom Kochhar, VLCC, and Dabur are among the many organic cosmetic and skin care brands available in India nowadays.

Furthermore, India's thriving fashion and film industries are fueling growth in the cosmetics sector by empowering Indians about the benefit of good appearances and demeanor. The majority of cosmetics producers in India currently serve the local market, although they are progressively expanding into international markets. Cosmetic manufacturers in India have garnered contracts from foreign marketplaces in recent times; for instance, Indian herbal cosmetics items are in high demand in the overseas markets.

Indian Skin Care Market Insights

The Indian beauty and cosmetic good market have been steadily growing in recent years. Body care, face care, hair care, hand care, and color cosmetics are the five key segments in which it is classified as can be seen in the image below. The color cosmetic and face care category has seen significant increase in the recent years depicting the changing consumer behavior patterns.

The beauty and personal care (BPC) sector in India is valued an estimated USD 8 billion as can be seen in the chart below. The surge in the frequency of skin disorders, as well as increased public knowledge about healthy skin, are two major drivers driving market expansion. Face care items led the market in terms of revenues, contributing for 57.22% of the market in 2020.

As can be seen below in the market snapshot, the cosmetic and skincare industry is on the rise in the forthcoming years. Moreover, the industry is being driven by simple access to such products via company web pages and digital channels, as well as home deliveries. Nevertheless, the high cost of branded skincare items, as well as the availability of counterfeit versions, limit its expansion.

India Cosmetic and Skin care products market analysis

According to demographics, the female section dominated the market in 2017, accounting for over half of the share of the market, and so this pattern is likely to prevail during the India skin care products market projected time-frame. This is due to an increase in beauty-conscious women who are putting in additional efforts to enhance their health and beauty. As a result, a surge in cosmetics spending boosts the whole market’s expansion. However, owing to a growth in men's awareness in retaining their physical appearance, the male section is predicted to grow at a high CAGR of 10.2% as can be seen in the graph below. Furthermore, the proliferation of men's salons is expected to stimulate the demand for skin care products in India.

As per the sales channel, in 2017, the supermarket or hypermarket held the majority of the market share for cosmetic and skin care goods in India. This is attributable to the premise that Indian customers have the ability to examine a wide range of BPC products from various brands and categories. Furthermore, the availability of store workers who can assist customers in selecting the appropriate brand and providing product information increases the segment's expansion. Nevertheless, owing to an increase in men's awareness in grooming habits, the salons industry in India is predicted to grow at a significant rate. As a result, anti-aging and other specialized men's BPC products are becoming more prominent.

As per category, the skincare and sun-care goods sector accounted for the largest proportion of the cosmetics industry in 2019; nevertheless, the deodorants & perfumes sector is expected to expand at the fastest CAGR throughout the projection term. People' regular healthcare regimens include a significant amount of skin care items. The market demand for skincare products is currently being driven by an increase in beauty consciousness and awareness.

Key Market Players

  • Unilever plc

  • Colgate-Palmolive Company

  • The Procter & Gamble Company

  • Godrej Group

  • Dabur India Ltd

  • Patanjali Ayurveda Limited

  • The Estée Lauder Companies Inc.

  • Emami Limited

  • Johnson & Johnson Services, Inc.

  • Himalaya Drug Company

  • Unilever Plc

  • L’Oréal S.A

The market capitalization of some dominant players in the Indian cosmetic and skincare industry is shown in the table below.

Driving Consumer trends that are shaping the Indian Cosmetic and Skin Care Market

  • Need for ecological, green, anti-fatigue, anti-pollution, and anti-aging products to promote physical and mental well-being.

  • Men's grooming products are becoming more popular.

  • Many businesses are focusing on improving brand recognition and positioning by partnering with well-known people. L'Oréal Paris, for instance, teamed up with designer Sabyasachi Mukherjee to launch L'Oréal Paris x Sabyasachi, a 21- piece limited-edition range of color cosmetics.

  • Expenditure on holistic bridal treatments, including such year-long skin care regimens, is on the rise.

  • The adoption of beauty gadgets and technology-enhanced goods and services is on the rise.

  • The cosmetics business is increasingly adopting digitization and integrated technologies leading to consumers preferences of at-home consultations via internet.

  • Millennial have a stronger feeling of individualism when it comes to purchasing and making decisions.

  • Curiosity and desire to trade-up, higher usage, and a larger product variety.

  • In purchasing behavior, peer input and customer reviews are becoming crucially influential.

  • As consumers place a greater focus on their personal health, the market for organic materials continues to grow, with a particular focus on the skin's protection and insulating the skin from the outside environment utilizing natural compounds.

The following market trends have been dominant so far and perhaps would continue to remain dominant in the future too:

  • The biggest profitable sector in India is color cosmetics, which includes eye, face, and lip cosmetics. Owing to the protracted wellness aspects that herbal/ayurvedic cosmetics provide for the skin, regional businesses like Soultree, Herbal Hills, Himalaya, and The Shahnaz Husain Group, amongst many others, are primarily producing herbal/ayurvedic cosmetics and skincare products.

  • In India, the digital economy for the purchasing of consumer products has grown rapidly in the previous three to four years as internet access has increased. This area has garnered a few niche experts, such as Nykaa, Purplle, Nnnow, and others, who are capitalizing on the growing e-commerce market and contending for a piece of the digital cosmetic industry pie. In India, Nykaa has over 600 brands available in both its online and offline outlets.

Future Projected Trends in the Indian Cosmetic Industry

During the projected timeline of 2020 to 2025, the India Cosmetics Products Market is expected to develop at a CAGR of 4.23 percent. Throughout the time-frame 2021-2025, some other skincare goods category, including depilatory cosmetics for the body and face, is predicted to develop at the quickest CAGR of 10.13 percent.

Males have commenced their improved skincare regimen apart from the gym, which is the most contemporary cosmetic industry development. The proliferation of men's salons is indicative of this.

Due to rising purchasing capacity and discretionary income, urbanization, expanding consciousness concerning beauty goods, and producers proactively marketing products in rural parts of India, cosmetic product purchases in India are booming. Cosmetic revenues are also boosted by affordability and a growing consumer base.

Urban India dominates the market, accounting for more than a fifth of total cosmetics demand. Numerous domestic & global corporations are now focusing on rural consumers in order to increase sales volume in segments such as lips and nails care, and even some mainstream skin care products.

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