The Mascara market is competitive with major market players operating at the global level. The key industry players in the Mascara market have adopted the strategies such as geographic expansion, new product launch, acquisitions, agreement, and R&D to strengthen their business portfolio. Most of the companies operating in this market are focusing on expanding their operations across the geographies, augmenting their capabilities and investing in research and development to offer products with better functionality.
This graph indicates the percentage wise business strategies taken by key manufacturers of mascara who have their presence globally. Loreal S.A. accounted the highest market share in the global mascara market in terms of development and accounted 23%. Mainly the company is focusing on acquisition to expand the portfolio and make their geographical presence prominent. The Estée Lauder Companies Inc. is accounting 18% of the overall development in the global mascara market. The company is emphasizing in the acquisition and expansion to increase the product line in developing economies.
Key manufacturers are also found to have high focus on strategic acquisition of small players which will further support the company to expand and reach out to consumers across the regions. Acquisitions are also done to mark the company’s presence and expand their business line. For instance, Coty, Inc. is focusing more onto acquisition of small players to expand the cosmetics business.
This graph indicates the percentage wise business strategies taken by mascara manufacturers at a global level. In the strategy analysis, acquisitions dominated the market accounting for a share of 38%. Key players in the mascara market are inclined towards introducing new products in the market or to extend the product line of renowned product. Also, the company promotes their new products on social media to reach out to customers. This promotional strategy aids to retain the existing the customers and to acquire new customers.
Other major players supporting the growth of the market include Oriflame, Alticor Inc., KOSE Corp., Amorepacific Corp., Natura Cosméticos S.A., The Face Shop, among others.
Threat of New Entrants
Economies of Scale: The mascara business is huge and highly competitive. Economies of scale includes factors leading to falling in the average cost of production as the value of output increases. The initial investments in the mascara market are moderate, including the processing equipment costs; also, the revenues are high considering the high demand for eye cosmetics in various regions. Production costs for mascara are moderate because of moderate investment in processing equipment, skilled labor inputs, maintenance cost, and safety testing & certification.
Product Differentiation: Although there is a high return on investments backed by improving production scope, the mascara market has a high threat of new entrants. Moderate investment costs eliminate the barrier for new companies to enter the market. To thrive in the market, the existing players must focus on product development and strategic product formulations with different growing and changing fashion trends to create product differentiation and outperform their competitors.
Therefore, the threat of new entrants to the market is high.
Threat of Substitutes
Availability of substitutes: Shift in fashion trends and high focus on beauty have escalated the overall demand for mascara on a global level. Mascara is gradually gaining its popularity, across the globe, due to the growing demand for eye makeup products. The close substitute of mascara is the lash curler accessory. Growing awareness about harmful chemicals, such as formaldehyde, in mascara can affect its sale. However, manufacturers are now focusing more on the production of chemical-free, organic, and/or herbal mascara with less or no irritants and harmful chemicals.
Ease of substitution: The ease of substitution is medium due to the unique formulation and long-lasting power of mascara. Increase in product innovations will further increase the market of mascara.
Price and quality of substitutes: There are established players in the mascara market who constantly indulge in R&D and find new techniques to develop products and maintain the quality. With better quality and high availability of mascara varieties, demand for mascara has surged, affecting the price of the product.
The threat of substitute of mascara market is low.
Bargaining Power of Buyers
The bargaining power of buyers is directly proportional to economic development. It includes the pressure consumers exert on businesses to procure higher quality products, better customer service, and lower prices.
Number of customers: The demand for mascara is high, owing to the increasing demand for color and eye cosmetics. Moreover, the trend of nude makeup products has a high impact on this market as mascara is available not only in monochrome but also in the transparent and varied color formula.
Switching cost of consumers: The presence of large industrial players in the global mascara market has attracted a huge consumer base. Due to the large number of existing manufacturers in the market, the switching cost of consumer falls. The consumers are well-educated about the product and they no longer have brand loyalty, which determines the bargaining power of buyers.
The bargaining power of buyers is moderate in the global mascara market.
Bargaining Power of Suppliers
Suppliers for mascara are the manufacturers, distributors, importers, and independent suppliers supplying via online retails. Due to the availability of established competitors, the suppliers have a moderate bargaining power. In addition, the low switching cost tends to lower the supplier’s bargaining power.
Uniqueness of suppliers: Bargaining power of suppliers is a crucial factor in the mascara market and determines the strength of the company. Key players, who are the suppliers (majorly), maintain a strong relationship with the consumers. The suppliers are unique in terms of formulation, sourcing, supplier relationship, and product functionality, thus, creating product differentiation and uniqueness among suppliers.
Supplier Concentration: There is strong supplier power in all regions due to the high demand for mascara. There are big international industrial players offering mascara. These key market players are dedicated to the new product development, innovation, and others.
Suppliers control over prices: The bargaining power of suppliers is low since the supplier group is high in the market and are well equipped to face the uncertainties and have low control over the prices.
Therefore, the bargaining power of suppliers is moderate.
Intensity of Rivalry
Number of competitors: The mascara industry is marked by moderate intensity of rivalry. The global market players in the mascara industry indulge in a rivalry where they aggressively target their competitors in terms of quality and price, thus, making the industry highly competitive and reducing profit potential for the existing firms.
Capacity of competitors: Players in the mascara market have moderate production capacity and focus on strategic investments. Major manufacturers are inclined to enhance the production capacity majorly in the emerging economies, owing to the high demand for eye makeup products.
The mascara market has numerous and powerful competitors. This market is fast growing; manufacturers want to increase consumer volume. The market players want to fight for a greater market share, which creates price wars, new product lines, and higher quality of customer service in the mascara industry.
Hence, the intensity of rivalry in the mascara market is high.
