Emerging markets present major sales opportunities for the hair and skincare industry. This is where the growth will come from.

Emerging Market Consumer Wants Innovative 'For Me' Formulations

Young populations in emerging markets guarantee a consumer base for the beauty industry for many years to come.

Exponential growth rates are due to more service industry jobs and female participation in the labour force.

Innovative formulations to suit their unique hair types and skin tones are wanted by all beauty buyers in the emerging markets of Africa and the Middle East.

Jume 2015

The beauty industry, like so many other consumer sectors, is betting heavily on emerging markets. The Africans and Asians who are entering the consuming middle classes represent one of the biggest opportunities in global business. Increased demand for products and brands here will drive growth and compensate for sluggish sales elsewhere.

For more than 15 years we have been researching changes in product demand and consumer behaviour in emerging markets. Nigeria and Saudi Arabia, just two of the many countries we have been tracking, indicate the possible directions and resulting opportunities of the hair and skincare market in Africa and the Middle East

They are important new markets not only in their own right but also as gateways to the key regions of west Africa and the greater Middle East. These economies have grown very strongly. Nigeria is now the continent's largest economy. Saudi Arabia accounts for over a quarter of the Arab World's GDP. (Estimates of market sizes vary widely but each beauty market could be worth well in excess of US$1.5bn.)

They are home to many millions of new consumers. Nigeria is the most populous country in Africa with one out of every four Sub-Saharan Africans being Nigerian. Saudi Arabia alone accounts for over 60% of the population of the Gulf Cooperation Council. The populations of these countries and regions are very young and – if the beauty houses win them now - guarantee a consumer base for many years to come. It is calculated that 40% of Nigerians are under 15 years while almost 60% of the Saudi Arabian population is under the age of 20.

Regimes and beauty cultures which dictate product demand vary significantly by country. Because these are fast developing markets we continuously interview beauty experts to find out what brands are being used and and keep abreast of changes in consumer behaviour. To guarantee the quality of our data, we conduct all our interviews in the experts' work-place in Nigeria and Saudi Arabia.

Every industry source we interview in cities like Lagos and Riyadh agrees that appearance-consciousness, which is at an all time high, is increasing their sales. Service (offices, retailing ) industries are expanding the number of jobs where image ('looking good') is all important. It is the young and working women now becoming wage earners and consumers who are behind these exponential growth rates. This societal change is most pronounced in Saudi Arabia where women now account for a small percentage (approx 6%) of the labour work force but more than half of students at third level.

The beauty experts we consult in all emerging markets insist that their customers demand specific formulations to suit their unique hair types and skin tones. They want products formulated “for me” - that is, which not only take their culturally specific concepts of beauty into account, but also allow for other key factors such as climate, pollution and, critically, purchasing power.

These beauty buyers also prize product innovation. They are suspicious of dumping. Consumers are resentful that outdated brands are now (or may be) offloaded on to them. Retailers in cities as far apart as Abuja and Jeddah (and all emerging markets) explain that foreign travel and the internet have transformed levels of brand awareness and knowledge – especially among the trendsetting urban young.

As regards specific market gaps for hair and skin products. Hair care presents a huge opportunity in Africa. Africans spend proportionally more per capita on haircare than their American or European counterparts. Their unique and complicated hair styling regimes require a wider range of products. Damage is also a major issue with African type hair and with Saudi Arabian women because of products used and the practice of covering their hair with veils. These consumers also want products formulated for skin lightening and pigmentation and pore problems.

Emerging market opportunities and new consumer behaviour are fully explained in our Global Haircare: Consumer Behaviour/Regimes and Market Report 2015. Contact for details