Business activity and strategy

The Beauty Care business sector is active in the Branded Consumer Goods business with Hair Cosmetics, Body Care, Skin Care and Oral Care, as well as the professional Hair Salon business.

In the Branded Consumer Goods business, we want to continue expanding our innovation leadership in the mature markets in order to further grow our market shares. To this end, we pursue a consistent, pro-active innovation strategy accompanied by strict cost management to allow us to step up our market investments and increase profitability. We are driving business development in our emerging markets by expanding our portfolio. The aim in our Hair Salon business is to continue pursuing our strategy of globalization. In this area, we will push forward targeting our emerging markets in particular.

Organic growth is at the center of our growth strategy. In a market environment characterized by strong competition, we pursue this strategy by focusing on our top brands, ensuring the rapid international launch of innovations with above-average profitability, and by selectively driving regional expansion. Further key success factors include strong support for our top brands through media and promotional activities. We regularly analyze our businesses and brands as part of our pro-active portfolio management approach.

In our Branded Consumer Goods business, our focus is on the international expansion of our core businesses of Hair Cosmetics, Body Care, Oral Care and Skin Care. Through targeted portfolio management and the associated marketing activities aimed at strengthening our top brands, we were able to further develop our ten biggest brands in 2012. They grew at a considerably faster rate than the overall portfolio, and once again accounted for more than 90 percent of sales. In addition to strengthening our brand equities, we focus particularly on the growth potential available in our key accounts. We develop our Hair Salon business through product innovations and efficient sales and distribution structures. At the same time, we are selectively taking advantage of new regional potentials.

Through our pro-active innovation strategy and the consistent strengthening of our brand values, we want to continue generating dynamic, profitable growth. In 2012, we were able to increase our innovation rate1 to 45 percent. And we are developing additional growth potential through expansion of strategic partnerships with our customers.

1
Percentage share of sales generated with new products launched onto the market within the last three years.

45 %innovation rate.