Market Analysis
Although Turkey’s economy is slowing down, the cosmetic industry has been growing rapidly. The beauty and personal care sector grew by 15.4% in 2012, its value being 3.3 billion euros. It is forecasted to grow by a further 10% in 2013, with its value being forecasted to reach 4.7 billion euros by 2017. The main driving force behind its growth is Turkey’s young population and the rapid urbanization taking place in Turkey (Cosmetics grow in Turkey 2014)
International brands are leading the beauty and personal care sector, holding 75% of market share in Turkey. The leading companies being P&G, Unilever, L’Oreal, Avon. Though it is difficult for the local companies to compete against these giants, on the price platform they have an edge over the MNCs (Euromonitor International 2015)
Since 2009, Turkey’s cosmetic industry has been growing rapidly despite the slow economic growth. Consumers have been cutting back on expenses such as holidays rather than cutting back on their beauty products. Though, the consumers do prefer cheap items instead of spending on the premium ones.
The various segments prevailing in the beauty and personal care industry in Turkey are cosmetics, fragrance, hair care, men’s grooming, skin care, premium cosmetics. The cosmetic segment has been growing at a fast pace, forecasted to increase by 6.36% in 2016 and by a further 6.2% in 2017. Whereas, the fragrance sector is showing a downward trend with the growth forecasted to drop by 0.25% in 2017. The hair care sector occupies a huge market, having a growth rate of 3.4% in 2016 (Euromonitor International 2014)
Since, Neon specializes in producing nail polishes, mascara, lipsticks, eyeliners, eye shadows, foundation, blushes, concealers, powders and with the high growth rate forecasted in the segment, it will target the cosmetic market. Its current market size being 967.4 million euros. Even though the saturation levels are increasing in the cosmetic market, there...