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Beauty and Personal Care in the Netherlands

Netherlands beauty products market: Economic crisis affecting sales

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2014-04-03 00:49:01 - Beauty and Personal Care in the Netherlands - a new market research report on

The Dutch economic crisis and its consequences in terms of unemployment and the public deficit have had an impact on beauty and personal care in 2012. Although the industry still managed to achieve growth in 2012, the value growth was lower than in previous years and there were several major categories that struggled and even registered a decline. High levels of investment in new product development for most categories, however, helped the industry to achieve growth in 2012 as consumers were still interested in exciting new products and products which helped them to solve specific beauty and personal care issues.

Due to the economic recession returning in 2012 to the Netherlands, both consumers and manufacturers have become a little more careful



and this resulted in lower value growth compared to 2011. The reason beauty and personal care still registered growth whilst other several consumer goods industries saw a decline is that with consumers cutting back on purchases, items in beauty and personal care are proving to be a relatively cost-effective means of improving one´s appearance without having to invest a significant proportion of a declining disposable income in, for instance, a brand new wardrobe.

Many categories in beauty and personal care suffered from an extremely high level of sales at reduced prices in 2012. According to some of the major players in beauty and personal care, more than 50% of all items are sold at a promotional price. Many consumers will stock up on their favourite brands when there is a price promotion, and both supermarkets and drugstore chains run frequent price promotions with beauty and personal care brands as they know they are very effective in increasing traffic to their outlets. This is one of the main reasons why the average unit price and value sales for many beauty and personal care sectors were eroded.

Although the proportion of beauty care products sold via the internet is still relatively low as of 2012, online sales of beauty and personal care products in the Netherlands witnessed a substantial growth over the review period. The Dutch still have a preference for health and beauty retailers when it comes to points of purchase for beauty and personal care products as in many cases the delivery charges of online retailers will be too high. As many consumers still visit a health and beauty retailer about once a week, there is no need for them to spend money on delivery charges. This issue holds back the development of online sales although the channel still manages to achieve high growth rates.

The outlook for beauty and personal care remains positive, although there are some doubts if the current success in launching added-value products which helped to create growth in most categories will continue to be as successful as it was in the review period. The economic situation and the maturity of the industry are likely to slow down the value growth over the forecast period. It is forecast that unemployment rates over the forecast period will remain relatively high, resulting in lower purchasing power.

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