The cosmetics market worldwide is a dynamically developing sector. For decades, this segment has been experiencing constant growth in interest, almost independently of the region. Several factors contribute to this trend, including increasing consumer awareness of skincare and beauty, rising income levels among populations, the introduction of innovative technologies in cosmetics production, and the growing influence of social media, which brings together influencers, cosmetologists, and specialists in the field to educate and raise awareness, thus shaping consumer preferences.
The entire European market, including Poland and the Baltic countries, is also actively participating in the thriving development of the cosmetics segment. It’s no longer just the well-known global brands that matter; there is increasing attention focused on local brands that represent slightly different values. The rising interest in cosmetics can be attributed, among other things, to the improvement of economic conditions in the discussed Baltic countries. The increasing consumer awareness of health and beauty is also a significant factor contributing to the growing demand for cosmetics. The e-commerce market also plays a substantial role in the development of this sector, as it has made virtually every brand and cosmetic product accessible to consumers.
How is the cosmetics market developing worldwide?
Market reports indicate that the global cosmetics market is constantly expanding. According to data presented by Grand View Research, in 2022, the value of the global cosmetics market reached around 262.2 billion dollars, and forecasts clearly indicate upward trends in the coming years. While the Far East, Oceania, and Australia remain the largest markets, one of the most dynamically developing regions is the Baltic market.
Does the e-commerce segment have a significant share in the sales of cosmetics in the Polish and Baltic markets?
Referring to the report “B2B E-commerce – Perspective of the Cosmetics Industry,” it should be noted that even up to 90% of Polish cosmetic companies sell their products online. They do so through their own sales platforms (37%), marketplaces (20%), and the EDI system, which is a closed tool for data exchange between business partners.
It is estimated that by the end of 2023, the entire Lithuanian cosmetics market should reach around 27 million USD, accounting for 18.4% of the entire segment. By 2027, it is expected to grow to 44.5 million USD. The e-commerce share in this sector is 23.5% and is projected to grow by an average of 7.4% year on year, reaching around 31% in 2027.
The Latvian cosmetics market is slightly smaller than the Lithuanian one. By 2023, it is expected to reach just over 16 million USD. E-commerce already has a significant share in this segment and is projected to reach 7.8 million USD by the end of 2023, accounting for almost 50% of the entire market. The share of the online market in this segment is expected to increase to 12.2 million USD by 2027.
In Estonia, the sale of cosmetics through e-commerce is expected to close at just over 14.5 million USD by the end of 2023. By 2027, it is projected to reach 22 million USD.
What is the potential of the Baltic market? Polish cosmetics brands with opportunities in the Baltics
Regarding the Baltic states, although their market is somewhat smaller than the Polish one, there is undoubtedly a clear increase in interest in cosmetics in this region. The improvement of economic conditions in these countries, as well as the growing consumer awareness of health and beauty, contribute to the constantly increasing demand for cosmetics.
Considering these trends, developing a Polish cosmetic brand in the Baltic markets could be an attractive option for expanding their cosmetic e-business. The key to success will be adapting products to the preferences and needs of local consumers, understanding the competition in these markets, and utilizing appropriate distribution channels.
How to develop your e-commerce in the Baltics?
It is worth noting that several factors have contributed to the growing share of e-commerce in cosmetics sales in the Baltic market, such as:
- Changing purchasing preferences: Customers increasingly prefer online shopping due to its convenience, the ability to compare prices and product reviews, and time-saving benefits.
- Increased accessibility: The development of internet infrastructure and the growing number of internet users have made e-commerce more accessible to consumers worldwide, including the Baltic region.
- COVID-19 pandemic: The pandemic has led to a surge in online shopping due to restrictions on in-person retail and the need for social distancing.
- Wider product selection: Customers can easily browse and compare cosmetic products from various brands, which encourages them to make online purchases.
- Promotions and special offers: Many online cosmetic retailers offer various promotions, discounts, and special deals, attracting customers to shop online.
These factors have allowed the Baltic e-commerce market to gain momentum. For Polish brands to remain competitive in this new landscape, they must also pay attention to logistical and technological aspects. A well-developed shipping structure, providing customers with various delivery options and payment methods,
is crucial.
Therefore, it is essential to start collaborating with a reliable partner who has already established expertise in the Baltic market, refined processes, and understands the specific preferences of Lithuanians, Latvians, and Estonians. Venipak, for example, not only has a well-established network of pickup points but also the right fleet of vehicles and technology, interfaces for e-commerce stores, and ready-to-use modules compatible with popular e-commerce engines.
Realizing the importance of focusing on online marketing when entering a new market, a partner who takes care of orders, warehousing, packaging, shipping, and even returns policy will prove to be invaluable assistance.
https://www.grandviewresearch.com/industry-analysis/cosmetics-market
https://www.statista.com/statistics/1360053/poland-cosmetics-market-value/
https://ecommercedb.com/markets/lt/beauty-care
https://ecommercedb.com/markets/lv/cosmetics
https://ecommercedb.com/markets/ee/beauty-care