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2005 proved successful for Bulgarian cosmetics and toiletries

2005 proved successful for Bulgarian cosmetics and toiletries, with current value sales recording growth of 5% over the previous year, said market research outfit Euromonitor.

Fragmented shares with strong competition contributed to the launch of many new products, which combined with a rise in demand for cosmetics and toiletries. Active marketing and advertisement for new products also boosted growth. Unilever's Dove skin care significantly increased its sales thanks to active marketing, for example, becoming one of the five most popular skin care brands.

A stable increase in disposable incomes was among the main factors stimulating the rise in cosmetics and toiletries during the review period, said Euromonitor.

2005 is expected to see the growing supremacy of foreign brands at the expense of domestic products. All top four foreign brand owners recorded an increase in their value share in 2005 over the previous year. On the opposite pole is top Bulgarian producer Aroma AD with stagnant value sales and shrinking value share. International players are increasingly utilising umbrella brand names for ranges, while high competitiveness is resulting in lower prices, said Euromonitor.

The top four international companies are Avon, Beiersdorf, Unilever and Oriflame. These are expected to improve their sales performance in 2005 thanks to a better recognition of their brands from consumers, who prefer quality for the money they spend. Furthermore, younger consumers are fuelling the growth of international brands, having been raised with Western culture over the last decade.

In 2005 direct sellers registered the highest growth rates, with direct sales becoming the most dynamic distribution channel especially for skin care, where is expected to dominate. Both Avon and Oriflame improved their sales techniques through better delivery of current editions of their catalogues to clients. Consultants are the main force behind the growth of direct sales offering door-to-door expertise.

In addition, 2005 saw the greater presence of TV and billboard advertising, especially from Avon Bulgaria EOOD. Furthermore, Avon and Oriflame both improved their online presence, further growing their customer bases.

Distribution over the review period changed significantly. Pharmacies/drugstores increased the number of cosmetics and toiletries on their shelves and hired consultants to assist consumers in selecting cosmetics and toiletries. Moreover, supermarkets/hypermarkets is proving successful within cosmetics and toiletries through the application of massive promotions, both in terms of volume and price.

Due to strong competition and the introduction of many new products during the review period, the price of mass cosmetics dropped, said Euromonitor.

Branding and marketing became the most significant tools for producers and distributors of international brands in gaining share in mid-priced and premium cosmetics and toiletries during the review period. In response, domestic companies such as Aroma and Rubela applied up-to-date branding techniques to solidify their positions with well-recognised brands such as Astera and Deva in order to compete with strong quality brands such as Unilever's Dove and Beiersdorf's Nivea.

Over the review period, there was a new trend towards more sophisticated and refined cosmetics and toiletries. Together with the leadership of traditional products, more innovative products spiced up the variety of products on offer. Younger consumers are being influenced by Western trends and the emergence of the "metrosexual man" fuelled growth, as more expensive and sophisticated cosmetics and toiletries gained value share at the expense of traditional and domestic products, said Euromonitor.