Shampoo: The State of the Global Market in 2021 and Beyond

A new shampoo brand is poised to change the way people think of shampoo. What will happen if this product is successful? It's likely that the old, established brands will see their revenue and market share decline. We've seen this sort of thing before--one example being how opening just a couple Walmart superstores in small towns changed shopping habits for many years to come.

Currently, there are three major companies in the hair care industry: Procter & Gamble (P&G), Unilever and L'Oreal. The market for shampoo is growing at a high CAGR per year in the US alone, where P&G controls about 25% of the market share, followed by Unilever at 18% and L'Oreal at 14%.

The new brand, introduced in 1994 by Suntory Ltd., a Japanese brewer. In December 1996, Suntory bought out Unilever's interest and today S2S is the best-selling shampoo in Japan. This success has been achieved without any significant advertising to date. The products are sold mostly through department stores and discount stores such as Costco and Sam's Club, which have helped sell the brand by offering extremely competitive prices--sometimes below cost. S2S is also sold through thousands of vending machines in Japan.

Marketing Objectives

In the US there's no doubt that new entrants will be a full-fledged marketing juggernaut. Many marketing objectives can be identified, but the primary ones are: 

The product development team has created a strategy for introducing the shampoo into the US market that's very different from Unilever's strategy. So far it appears to be working well for them at home, and since the Japanese are excellent imitators, Japanese-style marketing may just work here too.

The shampoo market has seen a lot of disruption as the growth prospects get limited due to challenges in demand. However, companies are adopting strategies to increase market share and remain relevant. Some of these include adopting new advertising campaigns or creating variants with new ingredients which are targeted at niche consumers or specific consumer segments.

In this blog post, you will learn about the shampoo market dynamics and how the leading players have successfully managed their costs in order to maintain sustainable operations and profitability, even when faced with various challenges such as low-price competition from emerging markets. You will also learn about recent company acquisitions that have been undertaken to diversify product portfolios.