Elder Healthcare, the fast moving consumer goods (FMCG) company, which has brands such as Tiger Balm, AMPM Mouthwash and FairOne fairness cream in its portfolio, plans to focus its attention on the premium end of the personal care market, with in-licensed products.
The company has set the ball rolling by tying up with companies such as Uriage Laboratories of France and POLA Chemicals of Japan. “Uriage’s face care range is already available in the market place,” says Anuj Saxena, managing director.
“We also have a hair rejuvenator called Foltene from a Greek firm called Gerolymatos International. This firm specialises in over-the-counter and cosmetic products and is a leading player in Greece. Uriage is also a key player in the high-end skincare segment in France.”
POLA products will be rolled out by the end of next month, he says. “POLA is again a leading cosmetics company in Japan. We are launching their whitening range in India.”
Typically, these high-end products will not be routed through regular distribution channels. Elder, says Saxena, is targeting cosmetologists, high-end skin specialists and plastic surgeons to push these products. “The model is prescription-based, with the products priced at over Rs 1,000 per unit. Only the Uriage range is competitively priced at Rs 300, going up to Rs 1,000 per unit.”
At present, the bulk of Elder’s revenues come from its mass-market personal care products, including brands such as Tiger, AMPM and FairOne. Going forward, says Saxena, the plan is to garner revenues of close to 30 per cent from its premium portfolio. “We have set a target of about two-three years to achieve this. We are hopeful of achieving it, given that the high-end personal care segment is growing, with the focus on skin and beauty.”
According to FMCG analysts, the roughly Rs 20,000-crore personal care market in India (this includes skin care, hair care, body care and oral care) has been growing at a compounded annual rate of 15-18 per cent per annum for the past few years. The high-end or premium segment has been growing at about 35 per cent per annum. This segment is pegged at over Rs 1,000 crore. “The base is small,” says Saxena. “But it is growing fast.”
Major companies such as Hindustan Unilever (HUL), Procter & Gamble (P&G) and LÓreal are already devoting their attention to the premium end of the market. Johnson & Johnson (J&J) has jumped in, too; it launched a skin care product, Neutrogena, last year.
The focus on the premium end, say analysts, is partly because consumers themselves have been moving up the value chain in terms of their needs. “It is no more about using a shampoo or a cream alone. The accent now is on what problem the product can solve,” says Shirish Pardesi, senior analyst at Mumbai-based brokerage firm, Anand Rathi. “This lends itself to some amount of premiumisation, which is why the focus on this segment.”
