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Markets & trends

Dermocosmetics market provides opportunities for industry and retail

Cooperation with dermatologists, technological advances, and focus on distribution are pointing towards increased consumer confidence.

Few cosmetic categories have attracted as much attention of the beauty industry lately as dermocosmetics. Known for their high concentration of pharmaceutical active ingredients, they bridge the gap between cosmetics and prescription products. In Brazil, this market is growing at annual rates of 20% to 30% and accounts for billions in sales, according to the latest IMS Health report.

Dermocosmetics area at Araujo Drugstore

Dermocosmetics area at Araujo Drugstore

To compete in the market, brands are working on several fronts, including investments in online sales as well as training with consultants at drugstores and pharmacies, which stand still as the segment’s main distribution channel. The relationship with dermatologists is also an important drive for the dermocosmetics market – about 70% of sales are generated through medical prescriptions, especially when it comes to products with high added value.

Despite Brazilians’ well-known appreciation for cosmetics and aesthetic treatments, one of the reasons attributed to the late development of the dermocosmetics industry in Brazil is the fact that many dermatologists used to opt for compounding pharmacy products, which allow them to combine different active ingredients to create a customized formulation. However, in the last decade, investments in technology and innovation greatly increased the penetration of dermocosmetic products, whose effectiveness is proven by clinical and laboratory testing, as well as having more consistent quality standards and longer expiry dates.

"The dermocosmetics market in Brazil has been gaining momentum and experiencing a consolidation period. It is an advance for the entire supply chain, with the use of unique raw materials, sophisticated packaging and specialized sales channels,” says Julio Bombonati, market manager of the Life Sciences division at D’Altomare Química. Consumers who are willing to invest in a dermocosmetic, he says, are not only expecting good results, but also new textures and a particular sensory stimulus. “The product’s appearance anticipates what it has to offer, which is complemented by its touch and aroma. Manufactures need to look for new ways to surprise the customer and create an emotional bond,” says Bombonati.

L’Oréal’s Cosmética Ativa division is one of the industry leaders in Brazil. The first brand to be introduced in the country was La Roche-Posay, in 2000, followed by Vichy (2001) and SkinCeuticals (2010). Available in 44,000 points of sale, La Roche-Posay launched its online store in 2014. The brand’s success is due to its strong cooperation with over 7,000 dermatologists and the development of local clinical studies. In 2012, the sunscreen range Anthelios AC was entirely developed in Brazil, focusing on the skin care needs of Brazilian women.

Aiming to strengthen its market presence, German-based Eucerin has begun a new cycle in Brazil, with all operations being directly controlled by BDF Nivea. The brand has been in the country since 2003, but distribution was previously carried out through outsourced partners, without a consolidated local structure. Out of the 100 products in the brand’s portfolio, only 24 were available in Brazil.

ADCOS dermocosmetics

ADCOS dermocosmetics

"There is an extremely favorable scenario for the relaunch of the range. We noticed a significant increase in the consumption of dermocosmetic products in Brazil in recent years. That’s why we want to be closer to customers, understanding their needs and habits,” says Tatiana Ponce, marketing director of Nivea and Eucerin in Brazil. According to information provided by Eucerin, the brand’s relaunch will focus on three strategic pillars: cooperation with dermatologists, consumer confidence and partnership with pharmacies.

Despite the strong presence of multinationals, the domestic industry also has important players – ADCOS is a good example. The company has been operating in Brazil for 22 years and is currently investing in the franchising model to expand its reach. The brand has over 100 stores across the nation, including kiosks, company-owned stores and franchises. ADCOS products are also sold online, at specialized pharmacies, aesthetics centers and spas. The Derma Complex Vitamin C 20%, launched in April, claims to improve skin texture, reduce wrinkles and fine lines. Its price at ADCOS’ online shop (R$199) is quite comparable to that of international competitors.

Fernanda Bonifacio

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