A MARKET REPORTON

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INTRODUCTION

In the early 1990s with the entry of L'Oreal and hair colours. The hair colour market became one of the fastest growing segments in 1998.

Today, if there are more brands in the Indian market, it’s largely due to demand.

When hair colours first came to India, it was largely to cover grey hair.

But with the increasing number of youth in the country, it has become a fashion statement, especially with the young and trendy.

INTRODUCTION

Hair colours were traditionally aimed at the 15-45 age female segment.

But market research shows that there was a growing population of 15-45 males which patronised the category in a big way.

This is because of the corporate culture that places an emphasis on young male employees looking smart and trendy.

That’s why all the players have plans to modify existing products, launch new products and target different geographic segments and age-groups. 

INTRODUCTION

In 2005 the total hair colour industry in India is around Rs 650 crore.

This is further divided into two segments. The Rs 450 crore retail segment, which is growing at a 20 per cent clip annually (2005).

According to market research Godrej’s market share at 40 per cent, followed by L’Oreal at 15 per cent and Revlon at 8 per cent(2005).

Rest of the brands make up the remaining 37 per cent(2005).

INTRODUCTION

The size of the hair colour market in 2009 was Rs 1,100 crore and currently growing at 14 per cent year-on-year.

Godrej Sara Lee, which operates in the men's hair grooming and styling segment estimates the men's hair grooming and styling segment to be a Rs 1250 million market.

Chitra Unnithan / Mumbai/ Ahmedabad March 10, 2010,

L'Oréal

L’Oreal made its debut in India in 1991 with the launch of Ultra Doux shampoo from Laboratories Garnier.

L'Oréal formed a joint venture with MJ Group to launch the Ultra Doux range of hair-care products. Encouraged by the acceptance its brand received in India, L'Oréal seized the opportunity to break the JV and form its own subsidiary in 1994.

L’Oreal expanded rapidly since it introduced its L’Oreal Excellence line of hair colour in 1997— The first time a company introduced the concept of hair colour other than black in the country.

L'Oréal

A company known for consistently launching new products every few years, French cosmetics major L'Oréal recorded a turnover of Rs 600 crore (Rs 6 billion), and a growth of nearly 40 per cent, in India in 2007.

One of the most important factors that worked for L'Oréal is its high spend on advertising. Globally, L'Oréal spends 30.7 per cent of its worldwide turnover on advertising and promotion and 3 per cent on research and development.

In India, it is the fifth largest media spender in the industry.

L'Oréal operates in India through four main divisions:consumer products, professional products, active cosmetics and luxury products.

The biggest contributor to its revenue in India is the consumer products division led by its strongest brand in terms of sales - Garnier.

Marketing Strategy

According to Mr Alian Evrard, zone director, Asia-Orient-Pacific, L’Oreal, a simple strategy. “Introduce new, different and better products,” and added, “we strongly believe that its never too late to enter a market if you have new, different and better products(2002).”

According to Mr. Dinesh Dayal, Chief Operating Officer "We have deployed a judicious blend of global and local methods of advertising to appeal to the Indian consumer,“.

“The Indian consumer is not as price conscious as it is often portrayed to be. Our brands were more expensive than an average fast moving consumer good (FMCG) here, yet we found a market because we were offering the right value for money," says Dayal.

Godrej

Godrej was the leader in the hair dye business for over two decades (1976 - mid 90s) with virtually no competition to its dominance in the Hair Dye market. The brand enjoyed a steady, albeit slow growth penetrating 4-5% of the all adult segment(2002).

In 2005, while Godrej is largely mass-based, selling its Colour Soft and Renew brands at Rs 99 and Rs 65 respectively.

Godrej Consumer Products Ltd has seen a 17 per cent growth in the hair colour category during the quarter ended December 2009.

Godrej hair colours are available under the brands Godrej Kali Mehndi, Godrej Expert, Renew Cream Hair Colour, Kesh Kala and Colour Soft.

Godrej

For GCPL, hair colour is the second biggest business for the company making up 23 per cent of its net sales in the last financial year.

Also being one of the most inflation-resistant categories in the fast moving consumer goods sector, GCPL plans to launch more products periodically in this space in the coming months, said Press.

Godrej

The powder hair dyes, make up 50 per cent of the Rs 580 crore hair colour market in India. However, in terms of volumes it makes up an even greater share of 75 per cent of the total market, said GCPL.

The rest of the market is made up of cream based hair colourants, which are catching up fast among the affluent consumers.

Godrej

• GCPL is still the market leader in the overall category with a share of 35.2 per cent. Although its share has gone down in the last six years from 43.9 per cent in 2002 as many players both global and local have entered the Indian market.

Market strategy of GCPL

Mainly television and a few press ads led the launch. The launch TVC focussed on the fact that Colour Soft was a breakthrough product especially formulated for Indian hair. Stylish in their execution, the commercials were run on mainline TV channels like Star, Sony and Zee TV. Thus the target group (25+year-old, SEC A/B women) was effectively reached(2002). 

"Premium is not the big focus area for GCPL right now,“.

The primary focus is to increase penetration of existing products in rural and semi-urban areas.

Revlon

Targeting the mass segment for driving volumes, Modi Revlon plans to push its hair colour brands harder in the market. It plans to introduce India-specific hair colour brands in the future.

The company has brands such as Colour Silk and Colour Stay, which span all price strata in the hair colour market.

Color N Care, priced at Rs 120 per packet, will be available in six shades - Natural Black, Brown Black, Medium Brown, Darkest Brown, Burgundy and Light Brown.

Revlon

The Rs 100-crore Modi Revlon started making profits last year and has been growing at 25 per cent for the past three years.

The company has set aside 15 per cent of its total turnover as its ad budget. It has been releasing ads from its international catalogue and has not aappointed an advertising agency in the country.

10 per cent market share in the first year. Modi Revlon, a 74:26 joint venture

between Modi Mundi Pharma and the US-based cosmetics giant.

Modi Revlon claims a market share of 41 per cent share of premium/mass premium segment as per Euromonitor data for 2006, placing it ahead of its competitors.

Marketing Strategy

"We have a two-phased roll out plan for the brand to build up our position in the mass market hair colour segment. While the first year, we only plan to educate consumers about the benefits of the product, the second year on, we will break onto the marketing scene with a 360-degree approach," said Mr Deepak Bhandari, Director-Marketing, Modi Revlon(2007).

"But due to the growing consumer base and demand for the segment in the country, we decided to launch a brand that was specific to the wants of Indian women" .,

On marketing initiatives, the company plans various below-the-line activities and use the print medium to promote the product, while in the second year, the campaigns will be expanded to television campaigns.

Marketing Strategy

The company also plans to add 25,000 outlets to its existing 25,000 distribution outlets to build upon its mass products portfolio.

The total ad spends for Color N Care will be Rs 5 crore for 2007-08.

Mr. Deepak Bhandari said, "Revlon's core area is colour cosmetics and we will continue to have innovations to develop the category in India”.

We are concentrating on 3 P’s i.e. product innovation, pricing and penetration at this juncture to increase our foothold / strengthen our position amongst the consumers.” 

Wella

Wella India, a division of Wella AG Germany, is the premier name in professional hair cosmetics & pioneer of innovation and trend spotting. 

High-Quality, High-Performance and High-Fashion are three of the key reasons why Wella Professionals and its products are preferred by the world's most renowned hairdressers.

Wella

P&G India now plans to enter the Rs 1000 crore hair colour market and will also get into the premium end of shampoo segment through this brand(2009).

According to Hyacinth D’Souza, Friseur Service Manager, Wella India, the advantage with P&G is that Wella already has a brand recall and awareness in the market, thanks to the grey market and salons.

Marketing Strategy

The company has plans to partner with leading Indian hair dressers to provide them with back-up and support systems such as the latest techniques in hair colouring and straightening, among other things.

Garnier

In the hair colour segment, Garnier operates in the mid-price and luxury segment. This has enabled it to garner a 20 per cent share in a market dominated by local hair colourants and dyes.

Garnier attributes its performance to being the first player in India to introduce a cream-based hair colour below the price of Rs 100 (2002) and the first home-highlighting kit (2005).

L’Oreal’s sub-brand Garnier Colour Naturals carries a tag of Rs 99, its Excellence is priced at Rs 399.

STREAX Hair Colour has already registered its footprints in its segment capturing above 10% market share in terms of quantity [Source : Nielsen Data] in a very short span of 3 years and the firm strongly believe that it was made possible only with its commitment to quality.

Having on board, the Fashion Diva Malaika Arora Khan as its BRAND AMBASSADOR, steady growth is forecasted in the years to come.

STREAX proudly associates with FEMINA MISS INDIA 2010 pageant as their official hair color & styling partner.

Streax currently holds second largest market share in India for hair coloring products. It has a healthy and consistent growth rate of 20% per annum.

According to market survey

Godrej is the market leader of the hair colour industry with approx 45%(which consists of their hair dye, powder clrs,n thr hair clr godrej clr soft).

L’oreal has a market share of 25%(it does nt cmpare with godrej as they want to increase their profit margins over the nxt yr)

Revlon has market share of 12%

Wella 8%

The hair colour market in india is worth 400to500 cr and is growing at an increasing rate of abt 24to25% yearly and annual production is estimated to be 400tonnes.

Segmentation- targetting the age of 18-45

and are targrtting women of group sec A

Targeted metros since their product is made for the upper class

Their psychographic segmentation is based on lifestyle where they are targetting women who lead a sopfisticated and stylish lifestyle.