Dan Zloteanu, the marketing manager of Beiersdorf, the company that sells the Nivea brand, believes the growth the market will see over the next period will not be triggered by the major segments, but by those segments that are traditionally considered niches.
"The niche segments have seen an increasingly faster growth pace over the recent 4 or 5 years, and they are currently witnessing a boom. The 50% surge registered by lip balms, for instance, was not caused by investments, but by this segment's increasing market penetration rate. The segment could "afford" such growth because it is still very small," explains Zloteanu. Shampoos, as well as deodorants each amount to 60-65 million euros every year, considering the whole market is worth 400 million euros (producer price) and 570 million euros (consumer price) respectively, not including the toothpaste, according to the company. The soaps rank second, deriving annual sales revolving between 35-37 million euros, while the face cream segment registers sales worth some 33 million euros.
"Romania is different from the other Western European states because the domestic segments of face and body care products are very small in comparison with the segments of deodorants and shampoos. This means that we may expect to see surges on these segments in the future, because we are lagging behind the other European states. The personal care products still surpass the skin care products," says Zloteanu.
Beiersdorf says that 94% of Romanians living in cities use one bar of soap per week, 89% use one bottle of shampoo per week, 85% one deodorant per week and 84% one tube of hand cream per week. As a comparison, only 24% of Romanians use lip balms and 38% use body lotion on a weekly basis.
"Romanians' eagerness to try new things is another characteristic that is very much to our benefit. They are not very loyal to brands and if the product is not good they stop using it. They will try a different product or they will return to a product they are familiar with. Apart from this gift for change that is typically Latin, the domestic consumers are willing to test and learn, probably because there were only a few categories of products before 1989," explains Zloteanu.
One of the methods the company uses to boost sales on the emerging markets is to constantly launch new products on these markets and to create awareness among consumers by earmarking considerable budgets for advertising.
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