Skin Care - Cosmetic Industry

Cosmetic Industry

The manufacture of cosmetics is currently dominated by a small number of multinational corporations that originated in the early 20th century, but the distribution and sale of cosmetics is spread among a wide range of different businesses. The worlds largest cosmetic companies are The L'Oréal Group, The Procter & Gamble Company, Unilever, Shiseido Company, Limited and Estée Lauder Companies, Inc. The market volume of the cosmetics industry in the US, Europe, and Japan is about EUR 70B/y, according to a 2005 publication. In Germany, the cosmetic industry generated EUR 12.6 billion of retail sales in 2008, which makes the German cosmetic industry the third largest in the world, after Japan and the United States. It has been shown that in Germany this industry grew nearly 5 percent in one year, from 2007 to 2008. German exports in this industry reached EUR 5.8 billion in 2008, whereas imports of cosmetics totaled EUR 3 billion. The main countries that export cosmetics to Germany are France, Switzerland, the United States and Italy, and they mainly consist of makeup and fragrances or perfumes for women.

The worldwide cosmetics and perfume industry currently generates an estimated annual turnover of US$170 billion (according to Eurostaf - May 2007). Europe is the leading market, representing approximately €63 billion, while sales in France reached €6.5 billion in 2006, according to FIPAR (Fédération des Industries de la Parfumerie - the French federation for the perfume industry). France is another country in which the cosmetic industry plays an important role, both nationally and internationally. Most products with a label, "Made in France" are valued on the international market. According to data from 2008, the cosmetic industry has grown constantly in France for 40 consecutive years. In 2006, this industrial sector reached a record level of EUR 6.5 billion. Famous cosmetic brands produced in France include Vichy, Yves Saint Laurent, Yves Rocher and many others.

The Italian cosmetic industry is also an important player in the European cosmetic market. Although not as large as in other European countries, the cosmetic industry in Italy was estimated to reach EUR 9 billion in 2007. The Italian cosmetic industry is however dominated by hair and body products and not makeup as in many other European countries. In Italy, hair and body products make up approximately 30% of the cosmetic market. Makeup and facial care, however, are the most common cosmetic products exported to the United States.

Due to the popularity of cosmetics, especially fragrances and perfumes, many designers who are not necessarily involved in the cosmetic industry came up with different perfumes carrying their names. Moreover, some actors and singers have their own perfume line (such as Celine Dion). Designer perfumes are, like any other designer products, the most expensive in the industry as the consumer pays not only for the product but also for the brand. Famous Italian fragrances are produced by Giorgio Armani, Dolce and Gabbana and others.

Recently, Procter & Gamble, which sells CoverGirl and Dolce & Gabbana makeup, funded a study concluding that makeup makes women seem more competent. Due to the source of funding, the quality of this Boston University study is questioned.

The cosmetic industry worldwide seems to be continuously developing, now more than ever with the advent of the Internet companies. Many famous companies sell their cosmetic products online also in countries in which they do not have representatives.

Research on the email marketing of cosmetics to consumers suggests they are goal-oriented with email content that is seen as useful, motivating recipients to visit a store to test the cosmetics or talk to sales representatives. Useful content included special sales offerings and new product information rather than information about makeup trends.