Deepak's Musings #156: State of the Beauty and Personal Care Market 💄

🍦 The fight for India’s ice-cream market

After trying for three decades, Hindustan Unilever Limited (HUL) is reportedly planning to sell off its ice cream business. Is HUL’s struggle attributed to its reliance on vegetable oil-based products instead of dairy? Indian consumers prefer milk-based ice creams.

🔖 The noise around private labels

I was surprised that only 7% of global CPG growth came from private labels. Shame on me for not doing the hard work of collecting, cleaning, and analysing the data. I (mistakenly) assumed that it was closer to ~33%, while brands still accounted for ~67%.

Given that my mission in life is to identify purpose-led entrepreneurs building the next generation of insurgent brands, the data that Frederic Fernandez has pulled together reaffirms the opportunity for insurgent brands to create emotional connections in categories that are not treated as low engagement.

💄 The global BPC market: McKinsey shares their outlook

Last week, McKinsey published a fantastic report on the global BPC market. I strongly encourage those building a brand in this space to download the full report.

In 2023, the global BPC market grew 10%, driven by price increases, reaching $446 billion. Growth was strong in regions like India, the Middle East, and Africa, but overall volume growth slowed. The market is expected to grow by 6% annually through 2028, with key drivers including skincare, fragrance, and niche products. Companies are encouraged to focus on sustainable growth through product differentiation, local market innovation, and omnichannel solid strategies to adapt to changing consumer preferences.

👄 The India BPC market: The Redseer-Nykaa Beauty Summit Report 2024

Coincidentally, Redseer & Nykaa released their 2024 Beauty Summit Report on the same day. At 54 pages, it is chunky and full of data and insights. Access the full report here.

As active investors in the category, we know that India's beauty industry is booming, projected to hit $34 billion by 2028, driven by e-commerce, social media, and rising demand for premium products. With consumers in smaller cities embracing global beauty trends, brands are innovating with multi-step routines and natural ingredients. Read the full report to dive deeper into this fast-evolving market.

🍬 Portfolio spotlight: GO DESi

The core of GO DESi is to build an emotional connection. The founders are crafting a unique experience that consumers can connect with.

👶🏻 Portfolio spotlight: Alia Bhatt says 'It Feels Right' with Superbottom

SuperBottoms' "It Feels Right" campaign celebrates the emotional and physical satisfaction of choosing the best for one's baby. The campaign emphasizes the benefits of high-quality cloth diapers made from organic cotton, highlighting their superior absorbency, cost-effectiveness, and chemical-free composition compared to disposable diapers.

🛵 Q-Comm is changing consumer behaviour. Are brands adapting fast enough?

I got Q-Comm so wrong! What Q-Comm is doing marks a new era where it isn't just about convenience but also about creating opportunities and value for brands.

🥤 The India cola wars: Campa takes on Coke and Pepsi

As the battle between beverage giants Coca-Cola and Pepsi intensifies, they now face a new challenge from Reliance's strategic move to disrupt the market. With Reliance offering differentiated products and more affordable pricing, Coca-Cola and Pepsi are pressured to rethink their strategies to stay relevant.

🤦‍♂️ Like wtf?

This is weird.

💰 Big CPG continues to look for targets to acquire and bolt on

We keep hearing this from the large CPG companies we speak to. More recently, General Mills flagged the same interest in their earnings call.

📰 Select funding & deal news

Funding and deal news that caught my attention