“Along with incomes, social aspirations are growing in Latin America,” Anais Mirval, ingredients analyst with the company, notes. She continues: “Thus, demand for sophisticated products is increasing.”
Manufacturers of hair care and deodorants are especially encouraged to expand their ranges to include ‘luxury-feel’ fragrances, with Mirval suggesting these are the consumer groups who will pose the strongest demand for more complex products with retained low prices.
Weak customer loyalty
Consumers of hair care in Latin America display a particularly fickle nature when it comes to brand loyalty, and so the strategy of adding value with fragrance is a go-to move for brands in the region.
Sticking with this strategy of adding fragrance value to products holds the potential for further growth, according to the research firm.
“As exposure to imported fine fragrances is growing, hair care manufacturers are responding to the changing sensibilities of consumers by migrating towards more complex scent blends,” Mirval notes.
Until now, the firm notes, manufacturers have focused on adding value to products with fragrance by introducing lines which boast ‘extra strength’ scents, particularly among male deodorant brands; the market is about to move now to an emphasis on more subtle, complex scents, in a bid to offer products which suggest greater sophistication.
Rising incomes
The increasing demand for more sophisticated products is in line with the continued rise of the average income within the Latin American country.
In Brazil, according to the OECD ‘Better Life Index’, the average household net-adjusted disposable income is lower than the OECD average of 23 047 USD a year.
Yet that now looks set to begin to even out: according to data from Euromonitor, disposable incomes of more than 10,000 USD will have risen by nearly a fifth by 2022.
Consumers with increasing money to spend will be looking for cosmetics and personal care products which match their rising social standing, is the conclusion put forward in the Euromonitor analysis.