The Singaporean market for health and beauty products is growing phenomenally in recent years. What is driving Singaporeans towards the good, and away from the bad and the ugly? Career Central goes shopping for answers.

By Joshua Rayan

When you only have two pennies left in the world, buy a loaf of bread with one, and a lily with the other.” This Chinese proverb encapsulates the age-old truth of the human condition: We have since times of yore wanted to be both healthy and beautiful as much as we have wanted food and drink.

A blooming market

Singaporeans are living truths of this, paying more for long life and good looks than ever before. According to market research company Euromonitor, the cosmetics and toiletries retail market in Singapore was worth almost US$379 million (S$659 million) in 2003, an increase in current value terms of 3.2% compared to 2002.

This is set to continue – Singapore is one of the top 10 Asian countries with the highest growth potential in the Retail and Consumer (R&C) sector, backed by a strong GDP growth rate of 8.4% in 2004, says PricewaterhouseCoopers (PwC) in its retail and consumer study, “From Beijing to Budapest: Winning Brands, Winning Formats”.

In terms of beauty, Singaporeans are now primping up mostly with cosmetic and skin or body care and grooming products. Health-wise, we’re pursuing longevity with health supplements, vitamins and ‘healthful’ liquids like Diamond water, as well as getting help from aids like slimming tablets to look healthy.

In 2003, the most dynamic growth sector was deodorants, up 8%, followed by sun care, up 5.8%, men’s grooming products, up 5.3%, and hair care up 4.7%, says STAT-USA (the US Department of Commerce), in its market overview report for US exporters.

Mirror, mirror on the wall…

Why the increase in vanity? Well, with media inundations of beautiful images, we’re all – men and women – now more conscious about how we look, and aware of how we could look. There is a growing number of affluent, image-conscious women who place a high priority on personal grooming and appearance. Women are also starting to apply makeup and experiment with hairstyles and hair care at a younger age than before. There has also been an increase in the demand for products with SPF (sun protection factor) and whitening properties.

“I definitely use a lot more facial and hair care products than my parents – or even my mum!” agrees Chan Soo Lynn, 29, a bank customer relationship manager. “And I use whitening products with SPF to keep my skin tone even and protect from sun spots, as well as UV rays.”

As in the animal world, where it’s the peacocks that preen, human males are also starting to primp, and be proud of it. There’s the much-highlighted emergence of the metrosexual – men who are conscious of how they look and aren’t afraid to spend to ensure it. Veteran skincare companies have been quick to recognise the potential, and have zoomed in with brands such as Nivea for Men by Beiersdorf (S) Pte Ltd, Clarins Men by Clarins Pte Ltd, Clinique Skin Supplies for Men from Estee Lauder and the men’s range from Body Shop.

However, even extremely macho men who would never call themselves metrosexuals are now willing to spend on bottles of beauty.

“I have an extremely ‘manly’ buddy who is quite well-groomed and probably has lotions, cleansers, the whole works on his bathroom shelves,” says aviation engineer and mountaineering enthusiast Surech Kuppusamy, 27. “In fact, he used to model so maybe that’s where he learned to take care of his looks. But he would never think of himself as metrosexual, and definitely wouldn’t want to be called one!”

More money to spend on mojo

Meanwhile, there is also an increasing awareness of health and fitness among Singaporeans, partly in response to stressful lifestyles. More people are seeking ways to de-stress and pamper themselves, as well as keep themselves healthy. This can be seen in the emergence of well-known fitness brands like California Fitness and Amore as well as other health and beauty facilities within shopping malls.

As mountaineer Surech says, “When people start exercising, they also tend to start watching what they eat, eating more health or workout supplements, and thinking more about overall well-being.”

Consumers now have more sophisticated demands. For example, a typical household will now have different shampoo brands and hair care items for different members of the family. There has also been a drop in purchase of ‘generic’ 2-in-1 shampoos. Perhaps in response to environmental awareness, there is an increasing demand for products that are natural.

Not everyone is convinced about the ‘natural’ nature of commercial products, though. “I used to work in a pharmaceutical,“ says IT consultant Ashraf Aswat, 28. “If you knew the amount of artificial stuff they put in to supposedly restore ‘natural’ properties to your skin, you’d be shocked! You’re better off mixing aloe vera and olive oil and putting that on your skin.”

While some may tout the benefits of home-made remedies, many of today’s working adults, who have little time for self-indulgence, want fast-acting products that will quickly yield visible results.

“I get home around 11 pm,” says Soo Lynn. “I’d like to use natural products, but I don’t have time to mix and mash stuff, except on some weekends. ‘Natural’ products in commercial packaging will do!”

The STAT-USA market report agrees, citing that “Consumers will be willing to spend on premium products as long as these products are able to deliver the required results, and at greater convenience.”

I Wanna Be Like You!

FMCG companies are capitalising on this by making people feel that they ‘need’ the product, that they ‘need’ to increase the steps of their beauty regime. Steps taken include glamorous advertisements that highlight the allure of perfumes and cosmetics and celebrity endorsements. The tried-and-tested method of celebrity endorsements still work, but in today’s world, brands are carefully selecting celebrities to fine-tune the identity projected by their products.

“A celebrity allows the woman at home to identify with someone, which you don’t get with a traditional model,” says Patrice Louvet, vice president of Clairol. The company has selected Desperate Housewives star Teri Hatcher as the spokesperson for its Nice ‘n Easy hair colour, as “Both Teri and Clairol have a similar appeal and a similar personality. They’re approachable, natural, relatable,” he says.

And Jessica Simpson is only the latest celebrity to use her status to carve out a new line of beauty products – or maybe food items. The 23-year-old singer/reality TV star’s erotic and edible “Dessert” collection features a menu of 13 “deliciously kissable” items like Belly Button Love Potion, Hot Body Topping and Whipped Body Cream with Candy Sprinkles. Again, seeing Jessica’s “relatable” image led some consumers to say they were more willing to test the product. Sounds like this writer’s favourite homemade meal!

Strategic partnerships

Strategic tie-ups also take place behind the scenes. For a fee, some supermarkets now offer FMCG brands access to customer knowledge that allows the brand to plan promotions that reach the correct target audience. Procter & Gamble and Nestlé in the UK are seeing excellent returns from investments in direct mail communications, and Unilever has joined forces with non-competing companies to pool their customer data.

The increase in the number of retail outlets has also resulted in increased partnerships between FMCGs and the retailers, including exclusive stocking agreements. And many FMCGs are now using rewards programmes that give perks and freebies to keep consumers happy and loyal.

Inventive products

FMCGs are also working overtime in research and product development to satisfy the consumers’ increasingly sophisticated demand for products – occasionally even creating new demand. Foods known for certain properties, for example, have been incorporated into beauty products in the hope that their association will ‘carry over’ into the new product. Thus we saw the rage for green tea products – something you once poured down your throat was now something you sloshed onto your skin and hair.

And far from being your grand-auntie’s favourite ancient remedy, even luxury brands like Elizabeth Arden picked up on the trend, leading to green tea products that are even more specific and specialised! We can now find product offerings like Green Tea Wasabi Mask from Naturopathica, an “all-natural, anti-aging, soothing mask for sensitive skin”. No doubt they were able to convince consumers that wasabi (that pungent Japanese horseradish) would be less painful to put on their skin than in their mouths!

As Singapore’s relatively mature cosmetics and toiletries market becomes more saturated, we can expect to see more competition among the top brands and an increase in niche players and more specific products. STAT-USA predicts an increase in niche players, which will expand the market by providing either unique or complementary products to consumers. Growth in constant value terms between 2001 and 2006 is expected to be 22.4%.

There will also be more promotions and campaigns targeting ‘youth’, i.e. consumers roughly between the ages of 15 and 24. These range from school-going teens to young executives new to the workforce. As a group, these people have disposable income and generally no car, house or loans to pay off. They are also attractive as trendsetters – the very young want to imitate them, while the older group want to do what they’re doing so that they can feel younger.

Its recent growth notwithstanding, FMCG is a giant industry that is constantly expanding. Even in a supposedly mature market like Singapore, growth is expected to be dynamic and the possibilities are excitingly vast. As consumers become increasingly sophisticated and discerning, the need for more innovative products will grow – as will the need for marketing savvy to carve out and delight new target markets.