Summary

The South African skincare market was valued at USD 663.51 million in 2020, and it is projected to register a CAGR of 4.25% during the forecast period, 2021-2026.

The COVID-19 pandemic is still transforming the growth of numerous industries. However, the pandemic’s immediate impact is varied. While some sectors may experience a decline in demand, many others continue to stay unaffected and exhibit strong development prospects. The skincare market has been witnessing significant growth due to the increasing health and hygiene consciousness among consumers, owing to the impact of the COVID-19 pandemic. The pandemic led to a shift in consumer priorities in 2020, with a focus on overall health and wellbeing. Consumers also prioritized naturally healthy and glowing skin as opposed to hiding their imperfections with make-up.

Over the long term, the market is experiencing accelerating demand for anti-aging products, like anti-wrinkle cream, face cream, serum, eye cream, and others, due to other factors, such as pollution and hard water conditions that are bombarding such products’ needs. An increasing number of consumers in the market are becoming aware of pollution’s impact on the skin. Increasing awareness about skin rituals and the urge to have a beautiful and younger appearance is driving product sales, allowing deeper penetration and expansion to new markets.

Consumers in the region are showing great interest in products formulated with natural and organic ingredients. Dermalogica, a European cosmetic brand, emphasizes the use of goat milk in its product formulations. Moreover, with the growth of the middle class and increased spending power across many socio-economic groups in South Africa, demand for affordable but reliable quality skincare products exists to fulfill the requirements of different ethnic groups and meet the demand for natural ingredients.

Key Market Trends

Rising Demand Among the Increasing Women Workforce

The country is experiencing a decent contribution of women in the workforce in recent years, which remains one of the key factors boosting the demand for skincare products in the country. Now, the African woman is not just engaged with skincare, and rather it is fast becoming a daily necessity and less of an indulgence. This behavior is being driven by a growing desire to understand skin, the impact of the climate, and the need for products that consistently deliver the desired results. According to industry experts, with increased disposable income and urbanization, women expect high standards and quality of products and services. Moreover, South African women, in particular, are most inclined to herbal and natural ingredients preferring natural active ingredients derived from vegetable extracts, like lavender, aloe vera, and other essential oils. Eyeing on the trend, many manufacturers are introducing innovative products incorporated with active ingredients.

Online Sales to Foster the South African Skincare Market

The rapid development of technology in the country is expected to be the major contributor to the growth of e-commerce in the country. The evolution of easy payments methods in the country is also one of the prominent drivers for the e-commerce market. The launch of Rabaki, an online retail store, is offering opportunities for locally present brands to improve their sales and stabilize in the prevailing uncertain economic situations. Brands are experimenting by being more creative with their narrative across platforms and consumer touchpoints throughout the purchase journey, from inspirational and positive social campaigns to content designed to save the consumer’s time while searching for a certain skincare product in the store. This is further driving the domestic brands and international brands that have a presence in the country to offer more products via e-commerce.

Competitive Landscape

South Africa's skincare market is highly fragmented due to the prominence of several small players in the market. Some of the prominent manufacturers present in the country are Unilever, Beiersdorf AG, Natura & Co., and Estée Lauder Inc., among others. Companies are adopting acquisitions, mergers, and launching innovative products to cater to the growing demand for naturally sourced products. The active companies have adopted product innovation as their key strategy to increase their geographic presence and customer base. With the growing demand for natural and effective skincare products, the market studied has witnessed an emergence of new kinds of products to cater to the growing demand of consumers of all age groups having different skin types.

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Table of Contents

1 INTRODUCTION
1.1 Study Assumptions and Market Definiton
1.2 Scope of the Study

2 RESEARCH METHODOLOGY

3 EXECUTIVE SUMMARY
3.1 Market Overview

4 MARKET DYNAMICS
4.1 Market Drivers
4.2 Market Restraints
4.3 Porter's Five Forces Analysis
4.3.1 Threat of New Entrants
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Bargaining Power of Suppliers
4.3.4 Threat of Substitute Products
4.3.5 Intensity of Competitive Rivalry

5 MARKET SEGMENTATION
5.1 By Type
5.1.1 Face Care
5.1.1.1 Cleansers
5.1.1.2 Masks
5.1.1.3 Exfoliators/Scrubs
5.1.1.4 Oils/Serums
5.1.1.5 Moisturizers
5.1.1.6 Other Face Care Types
5.1.2 Body Care
5.1.2.1 Body Lotions
5.1.2.2 Body Wash
5.1.2.3 Other Body Care Types
5.2 By Distribution Channel
5.2.1 Hypermarkets/Supermarkets
5.2.2 Specialist Retail Stores
5.2.3 Online Retail Stores
5.2.4 Other Distribution Channels

6 COMPETITIVE LANDSCAPE
6.1 Most Active Companies
6.2 Most Adopted Strategies
6.3 Market Share Analysis
6.4 Company Profiles
6.4.1 Unilever PLC
6.4.2 Procter & Gamble
6.4.3 L'Oreal SA
6.4.4 The Estée Lauder Companies Inc.
6.4.5 Beiersdorf AG
6.4.6 Clarins Group
6.4.7 Clicks Group Limited
6.4.8 Amka Products (Pty) Ltd
6.4.9 Johnson & Johnson

7 MARKET OPPORTUNITIES AND FUTURE TRENDS

8 IMPACT OF COVID-19 ON THE MARKET