Despite continuation of the crisis and a current value decline by 2% these factors have had an interesting effect on this category overall. Following global patterns of behaviour, demand has increased more strongly than demand in the other categories, which is impressive since this is a relatively big category in terms of value. The “lipstick effect” has many reasons for its occurrence, but the most notable are to create illusions of a prestigious life and to attract wealthier partners.
Benice TOV (formerly Sot Bi TOV) and L’Oréal Ukraine retained leadership in 2014 with a combined value share of 32%. They owe their positions to the goodwill towards the companies and brand recognition amongst the majority of Ukrainians. The perception of the brands Bourjois and Maybelline (Benice) and L’Oréal, (L’Oréal Ukraine) as premium at affordable prices and advertising in mainstream media also supported their leading positions over the review period. L’Oréal Ukraine was followed by the direct sellers Oriflame Cosmetics Ukraine and Avon Cosmetics Ukraine with 14% and 12% value shares, respectively. Both direct sellers have leading positions because their sales are evenly spread across rural and urban areas. In fact, rural areas were not far behind the urban areas in terms of volume sales in 2014, but mostly in value terms, with the rural consumers focused on economy brands whilst medium-priced and premium products appealed mainly to urban consumers.
Colour cosmetics is expected to see stagnation in the forecast period. Interestingly, this category is one of the few that is not strongly affected by economic downturns. As local sources state, women in Ukraine do not scrimp on make-up and clothes, and that habit is unlikely to change.