Comments on Brazilian production

Comments on Brazilian production

In the Russian market of perfumery and cosmetics, the Brazilian production enjoyed a rather low level of consumer awareness. Major share of Brazilian import till 2008 was occupied by the company L'Oreal (mascara "Maybelline") and Colgate-Palmolive (toothpaste). In 2008 after stopping of supplies of these goods Brazilian share in total import volume plummeted several times.

At present Brazilian producers may face certain difficulties in case of entering the Russian market; the main weaknesses of Brazilian production and challenges in the Russian market are as follows:

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  High saturation level of the market and low loyalty of Russian consumers to brands as a whole;
  
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  Almost zero awareness of Russian consumers about Brazilian cosmetics;
  
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  Manufacturing and transportation cost of Brazilian production may be higher than the one of other producers, and Russian mass-market segment (the largest one) focuses mainly on price;
  
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  Only two Brazilian brands are represented in the Russian market, they are BioAge and Bonyplus; the production under these brands are presented in Russia in a very limited line (mostly in some beauty salons and Internet-shops).
  
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  Entering the market all Brazilian producers will have to form the image of their products from the ground up.
  

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  To pay particular attention to pricing policy. Long transportation, working through intermediaries, the high expenses of promotion can greatly increase the cost of goods for final consumers. We recommend organizing a system of marketing so that the cosmetics that is in mass segment in Brazil would not be marketed as a luxury one in Russia.
  
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  To emphasis the naturalness of the production. Russian consumers prefer cosmetics made on the basis of herbal extracts; this was proved by many companies (Green Mama, Clean Line, Oriflame) the key to success of which was the production made of ecologically friendly and natural products.
  
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  To pay more attention to the segment of anti-age cosmetics – this group of cosmetics is becoming more popular in Russia substituting the universal care products.
  
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  To raise awareness of Brazilian cosmetics among Russian customers through participation in fairs and exhibitions, advertisement in press etc.
  
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  To use in advertising and in brand positioning the formed image of the country. In general the Russians formed a positive image of Brazil; the main associations to the country are as follows: the Brazilian carnival, football, serials, coffee, and Amazonian forests. The use of these stereotypes can assist to make the Brazilian cosmetics brands more accessible for perception and to increase attractiveness of the production.
  
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  To contact with more numbers of importers for increasing import volumes; to use their opportunities of products distribution, etc;
  
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  To pay attention of means of prior attraction of customer (design, packing).
  

3. Cooperation with Brazilian companies

A producer of perfumery and cosmetics can work on the territory of the Russian Federation through several forms of cooperation.

At present many companies in Russia are offering such contract manufacturing services.

4. Industrial associations

The Association of Perfumery, Cosmetics and Household Chemistry Manufacturers (APCoHM)

The Perfumery and Cosmetics Association of Russia (PCAR)

www.pcar.ru

The Perfumery and Cosmetics Association of Russia (PCAR) represents a non-government non-profit organization as a professional federal-level union.

PCAR main goals are: to render information and legal assistance to entrepreneurs on the Russian cosmetics market and to maintain and support the operators of the perfumery and cosmetic branch.

The Direct Selling Association (Russia) (DSA)

www.rdsa.ru

The Direct Selling Association (DSA) is the national trade association of the leading firms that manufacture and distribute goods and services sold directly to consumers. The mission of the Association is "To protect, serve and promote the effectiveness of the member companies and the independent business units they represent. To ensure that the marketing of products and/or the direct sales is conducted with the highest level of business ethics and service to consumers."

The Eurasian Union of Manufacturers and distributors of products for your health

Euro Alliance - a non-profit organization, established December 13, 2005 by the group of powerful companies and institutions - the developers, manufacturers and distributors of products for health (dietary supplements, food products and cosmetics). The headquarters of the Union locates in Novosibirsk. The purposes of establishing the Union: corporate support for the protection of producers and distributors; participation in the quality control of production; creation and active implementation of joint programs for health support of the nation. Today, the Union has established and effectively implemented dozens of recreation programs, a system of voluntary certification of producers of dietary supplements, etc.

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