Although price still remains a major factor to Indian consumers, the skin care market is expanding as consumer views start to shift more towards necessity rather than luxury due to increased income and consumer knowledge.
With the skin care market valued at Rs 400 crore for 2012 and estimated to be growing at a 15 percent CAGR, industry expert Dr. Nilayini of the American Society of Aesthetic and Cosmetic Physician reckons that with an increasing focus on enhancing beauty care coupled with latest innovations in skincare treatments, the sector has grown in leaps and bounds.
Nilayini who has just invested in a cosmetic centre in South India due to the expansion of the market, says this in turn is creating more opportunities for dermatologists and cosmetologists to expand and develop more products for consumers.
"As a result, skin care treatment will soon become affordable to rising Indian middle class," says Nilayini.
West vs East
Compared to the western market, the expert says the Indian market is dominated by lifestyle such as the need to brighten the skin.
Our present ‘middle class’ is expected to reach or cross 40 percent (or > 500 million) of our vast population. With India witnessing one of the fastest growth in economies, even the purchasing power parity is expected to increase from 4.7 percent to 6.1 percent of the world share by 2015.
Consumer habits in western culture have had a great deal of influence on the spending patterns and consumer habits of the Indian population in recent years, particularly the middle class, who are keen to try new products.
This has led many Indian consumers through a period of experimentation with their personal care routines, acquiring new habits that have helped forge the development of niche and evolving categories.
Indian market coming to the forefront
Currently, Nilayini says treatments like skin brightening, hydration, and hair loss tonics most popular with consumers and that while many prefer international cosmetic institutions, Indian ones are starting to come to the forefront as they remain more cost effective and are enabling today’s Dermatologists & Cosmetologists to invest in the latest high-tech equipment to offer more choice.
"It is no secret that a quite a sizeable chunk of urban as well as Semi Urban market in India is witnessing the emergence of 'New Look Woman' as well as 'Extra & Enhanced Beauty Care for Men', which is driving the skin care sector."
Indian cosmetic companies are also said to be starting to make greater inroads into the market by upgrading the quality and technology for their products.