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The cosmetics market in Europe: today's challenges, tomorrow's opportunities

Despite not having a lengthy history, the European Union has established itself as one of the top economic powers in just 15 years, ranking alongside the United States and China for its role in international commerce. 

Europe is a key market for the cosmetics industry. In 2019, the total value of the sector was more than $123 billion. In 2020 the global pandemic, which dealt a heavy blow to many of the 27 Member States, brought that figure down 3.5% to $118.8 billion and seems to have triggered longer lasting consequences compared to other regions. Forecasts by Euromonitor International, an international market research company, expect a slow recovery in 2021, with a total value of just over $119 billion (+0.1% compared to 2020, -3.3% compared to 2019), and even in 2022 pre-COVID figures will still seem distant. In fact, Euromonitor analysts expect revenue to reach $120.2 billion next year, -2.3% compared to 2019.

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Consumption on the European continent will be driven by mass beauty: in 2021 the category will reach $69.7 billion, +0.3% compared to 2020. With the outbreak of the pandemic, the sector experienced a moderate dip (-0.5% compared to 2019). Meanwhile, COVID-19 had a marked impact on Premium beauty: from being worth $34 billion in 2019, Euromonitor expects the category to be worth $30.4 billion at the end of 2021, a 12.2% loss. Skincare is one of the best performing categories in Europe and is responding well to the post-COVID transformation: in 2022 skincare will surpass $27.5 billion, re-aligning with 2019 levels.

4 of the 28 Member States (before Brexit in 2020) are major powerhouses, with yearly market value in the double digits, and Western Europe is leading the entire continent toward recovery, accounting for some 80% of the total yearly revenue. Of these, Germany is the leader, with $19.3 billion at the end of 2020. Next is the United Kingdom, which experienced a general downsizing after Brexit in 2020 (Read HERE Brexit: what impact will it have on the beauty industry?). France closed 2020 at a little over $14.4 billion, while revenue in Italy, the fourth market in Europe, was $11.3 billion, -12.8% compared to 2019. Revenue in Italy was especially hit by the decrease in exports (-16.5%), but the sector is seeing important signs of recovery. Cosmetica Italia, a national association of cosmetics industries, predicts +6.1% growth between 2020 and 2021, with a 5% increase in exports.

To return to significant economic growth, the EU is preparing imposing digital, environmental, and social re-qualification projects that will limit differences between Member States, creating a more compact organism that can address a changing market with greater unity and authority. 

All data and insights are proprietary information from Euromonitor International.

 

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