InterCHARM 2014 Beauty trade fair #1 in Russia, CIS and Eastern Europe

Show & Industry profile

About InterCHARM

• InterCHARM is the largest beauty trade show in Eastern Europe, a gateway to growing markets.

• Bringing together nearly 70 000 visitors and over 1000 exhibitors, the event covers both major, well-established sectors and emerging trends of the Beauty Universe.

• Being the ideal platform to enter Russian growing market, InterCHARM will run on October 22–25, 2014 at Crocus Expo for the 21st time.

Russian Market

Russian Perfumery & Cosmetics Market

Russian perfumery & cosmetics market estimated at USD 16,5 bln (RUB 485 bln)* Russian market is in TOP 4 largest perfumery and cosmetics markets in Europe Market grows by 10-12% annually – almost twice as dynamic than global market. That’s why Russian market has grown by 57% over the past 5 years

* Source: RBC.Research, on the basis of Ruble rates. Notice: USD/Ruble rates has been changed significantly during 2013

9,7

11,2

13,5 13,9

16,5

2009 2010 2011 2012 2013

Russian market value (bln. USD.)*

Russian Consumer

65% of Russians live in 20% of the territory The urban population is 74%. 15 cities are populated by more than 1 mln Russians each. Total population of these cities are 32 mln. In fact, the population of Moscow is 8% of the country population 45,6 mln of Russians are women aged from 20 to 60 years. This is one-third of the total population

* Source: Rosstat

142,86 142,87

143,06

143,35

143,67

2010 2011 2012 2013 2014

Population of Russia (mln)*

Market Players: Manufacturers

By now, most international leaders have manufacturing sites in Russia. TOP 10 manufacturers:

1. L’Oreal 2. Avon 3. Kalina 4. Nevskaya Kosmetika 5. Arnest 6. Faberlic 7. Mezoplast 8. Svoboda 9. Unikosmetik 10. Vesna

Local 75%

Imported 25%

* Source: RBC.Research

Market Players: Chains

L'Etoile; 9,5%

Rive Gauche; 6,0%

Ile De Beaute; 3,6%

Other; 80,9%

Leading chains: Sales revenue (2012, USD mln, excl. VAT)*:

* Source: RBC.Research

790 stores

203 stores

141 stores

1 193,9 + 64,9%

755,1 + 8,1%

455,8 + 15,2%

There are about 200 chains in Russia, 3 of which are leaders, sharing together about 20% of the market. Most of chains are regional and often not represented outside their region.

Chains, total:

7 580 (2013) 6 050 (2012) 4 869 (2011)

Sales Channels*

Specialized retail chains, drogery

41,0%

Direct sales 25,1%

Drugstores 5,1%

Open markets 6,5%

Other, incl. supermarkets, internet

etc. 22,3%

Average increase in the number of Russian retail chain stores is more than 20% annually

Specialized retail chains, incl. drogery Direct sales Drugstores Open markets Other, incl. supermarkets, internet etc.

* Sources: RBC.Research, Euromonitor, Company research

Tendencies:

Sales Channels

Specialized retail chains, incl. drogery

Direct sales

Open markets

Drugstores

Other, incl. supermarkets, internet etc.

Cosmetics Import

2009 2010 2011 2012

Fragrances

Lips make-up

Eyes make-up

Nails care

Powder

Other cosmetics

France; 22,2%

Germany; 10,7%

Poland; 8,2%

Italy; 6,5% USA; 6,1%

China; 3,2%

Spain; 2,5%

Romania; 2,0%

Ireland; 1,9%

Turkey; 1,8%

Other; 31,8%

Import value (2011)*: USD 3370,3 mln

Main importers are France, Germany and Poland

Together these countries deliver one-third of the cosmetics

import to Russia

* Source: RBC.Research

Digital

Efficiency of digital advertising* of perfumery and cosmetic products is one of the key elements to increase sales. It definitely shows rising interest. Decorative cosmetics Perfumery

Clicks. Search Engines

Clicks. Thematic Platforms

* Source: Yandex

Tendencies. Forecast

Tendencies 2014-2016: • stable or slightly decreased pace of retailers’

sales revenue growth • decreased demand for premium products, with

increased demand for middle-market and mass-market products. Nevertheless, lipstick effect is still possible

• increased retail prices of perfumery and

cosmetics due to increased prices of imported products and raw materials

• acceleration of market consolidation and increased competition in major cities, leaching with small market players

• further strengthen the influence of drogeries and single-brand boutiques on selling natural cosmetics and increased sales of cosmetics in drugstores

13,5 13,9

16,2

17,6 18,7

19,8

2011 2012 2013 2014F 2015F 2016F

Forecast 2014-2016, USD mln.*

* Source: RBC.Research

InterCHARM

InterCHARM is #1

* By number of exhibitors

• Exhibition #1 in beauty industry of Russia, CIS and Eastern Europe*

• InterCHARM is the ideal place to enter Russian growing market, discover new opportunities, find distributors and enlarge business scope

• With some 3500 brands represented this is the largest in the region showcase of the most innovative products and services, opportunity observe the whole market at one glance and a meeting point for all industry professionals

• The event delivers promising contacts, content, communities, and inspiration with the power to transform your business.

InterCHARM – Beauty Universe in 4 Halls

The comprehensive showcase of diverse beauty industry: • Perfumery and cosmetics • Hairdressing • Nail Service • Beauty Salon and Institute, SPA • LA NICHE: artistic perfumery • GREEN VALLEY (new!): natural and organic beauty

products • ECO-HOME: eco-friendly household detergents • FARMA+BEAUTY: pharmacy beauty products • ZOOM: innovative and niche products • Russian manufacturers’ pavilion • Raw materials • Packaging • Contract manufacturing services • BE@UTY IN INTERNET (new!) • Novelties gallery

Green Valley – ECO only

One of the most expected premiers of Russian market • Organic products • Natural cosmetics • Environmentally friendly cleaning products • Cosmetics for home care • Food supplements • Nutraceuticals • Certification authorities • Specialized media

Knowledge and Emotions of InterCHARM

Program for each segment of beauty industry: facilitates, educates and trains • “BIO.RUS” Competition for the best natural

perfumery and cosmetics product in Russia • “My Cosmetics” Award, the competition

demonstrating new trends and capabilities of the Russian cosmetics market

• Trade forums “Competent supplier: strategies of work with retailers” together with “Supplier meets buyer: center for retail chains”

• Russian hairdressing and styling championship • YOU.Prof.SHOW • Congress on podology • Nail service school • All-Russian convention of beauty salons • InterNailCHARM – Nail sculpture championship • International spa massage championship • Seminar on neuroscience and neuromarketing

for beauty industry

InterCHARM 2013:

Unprecedented Performance

• 4 halls

• 30 events

• 32 countries Belarus, Bulgaria, China, Czech Republic, France, Germany, Greece, Hong Kong, India, Indonesia, Israel, Italy, Japan, Latvia, Lebanon, Lithuania, Luxembourg, Malta, Netherlands, Pakistan, Poland, Russia, Singapore, South Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, Ukraine, USA

• 300 master-classes

• 1 022 exhibitors

• 3 500 brands

• 22 000 sqm

• 67 382 visitors

(+9% compared to 2012)

InterCHARM 2014:

Wide Geography of Participants

Among our exhibitors in 2014 are clients from the following countries:

Bahrain, Belarus, Belgium, China, Czech Republic, France, Germany, Greece, Hong Kong, India, Israel, Italy, Japan, Latvia, Lithuania, Netherlands, Pakistan, Poland, Singapore, South Korea, Spain, Switzerland, Taiwan, Thailand, Turkey, USA. And geography’s becoming wider!

Steadfast International Status, 2014

* By number of exhibitors

• The latest novelties from the globe are constant features of InterCHARM

• Exhibitors from over 30 countries including 12 national pavilions

• Recognition: • leading industry associations: PCAR,

STANPA, KCIC • international trade media: SPC, BWConfidential,

Expression Cosmetique, Export Magazine, PremiumBeautyNews.com, etc.

• Agents and International Sales Group offices (Reed Exhibitions) in major markets

• UFI approved event

Exhibitor Profile, 2013

Professional Cosmetics ; 352

Perfumery and Cosmetics; 180

Nail Service ; 161

Hairdressing ; 115

Raw Materials and Packaging ; 62

ZOOM; 34

ECO home ; 13

Farma+Bio; 38 LA NICHE; 7

Exhibitors - Specializations

190 233 235

298

644 696 695

724

834

929 930

1022

2010 2011 2012 2013

Exhibitors - Number

International

Russian

Total

Effective Tool to Expand your Business*

• 91% of new and 84% of total exhibitors established new business contacts

• 2 of 3 exhibitors of InterCHARM-2013 planned to book for 2014

• 40% of attendees come in search of new products and suppliers

• 71% of visitors met new suppliers at the show

• 93% of visitors plan to attend again

* Figures based on 2013

Visitor Profile, 2013

34900

48500 51700

61700

67400

2009 2010 2011 2012 2013

Professional Nail; 26%

Professional Beauty; 19%

Beauty salon owners; 15%

Representatives of distributors and retail ;

14%

Professional Hair; 13%

Doctors; 3%

Manufacturing companies; 1%

Private practice and other; 7%

Interests

Moscow, Moscow region; 51%

Privolzhsky District; 15%

Central District excl. Moscow & Moscow

region; 9%

Saint-Petersburg and North West District; 7%

South District; 6%

Ural District; 4%

Siberian District; 2% International; 2%

• Number of visitors increased by 9% in 2013 and by 93% in the past 5 years

• 49% of visitors came from Russian regions and abroad

9 436 approx.

674 approx.

Media Coverage

All media-channels employed for visitor promotion: attendance grew 9% (over 67 300 visitors) • Direct mailings, e-shots and text messaging to database of over 250 000

industry specialists • Cosmetics in Russia e-newsletter to international clients and attendees • Trade, business and glossy magazines: advertising & editorial articles • Advertising and editorials on industry web-portals • Personal invitation of owners and purchase executives: telemarketing in

Russian regions (North-West, South and Privolzhsky districts), Armenia, Belarus and Kazakhstan)

• InterCHARM account in Youtube.com • Regular posting and tickets draws in social media: 36 000 followers of

InterCHARM groups • Competitions in professional forums and groups • Radio Advertising • Television Advertising

Client Feedback

“It is our first time at InterCHARM. As long as Londontown products are not present on the Russian market now – InterCHARM is a good opportunity for us to expose our brand to the market and find distributors. The exhibition is good for us overall, we are well-received by audience here, and it is a good chance to meet masters of manicure on the ground”.

Natasha Dillon, Managing director, Londontown, USA

“Iceland Cream presented natural skin care products from Iceland on Russian market. We are a young company, less than a year on the market – so this is our first InterCHARM – and we consider it a good starting point! We presented our products in LA NICHE pavilion, and we like everything about it – stylish design, our neighbors and the overall cozy atmosphere. We see that the customers are expressing more and more interest to bio cosmetics and we are happy to observe such a trend”.

Elizaveta Voskresenskaya, Brand director, Iceland Cream

“Our company participated in InterCHARM several times. We are glad that the exhibition attracts a good mix of final customers and wholesale companies, and we have a chance to establish contacts with serious clients, such as retail chains”.

Alexandra Skripnik, Marketing manager, Ecoway/Ecover

InterCHARM Exhibitions Family

InterCHARM brings together perfumery and cosmetics industry: retail, professional equipment, products and services for beauty salons, packaging and ingredients for manufacturing of beauty products. Location: Moscow

INTERCHARM professional is the leading event of professional cosmetics and beauty salon equipment industry in Russia, CIS and Eastern Europe. Locations: Moscow, Saint Petersburg

Organizer

Reed Exhibitions is the world's leading organizer of exhibitions and conferences.

We bring together over 90,000 suppliers and more than 6 mln buyers from around the world every year generating billions of dollars in business. Today Reed' events are held in 40 countries throughout the Americas, Europe, the Middle East and Asia Pacific, and organized by 34 fully staffed offices.

Reed's portfolio of over 500 events serves 43 industry sectors.

Working closely with professional bodies, trade associations and government departments Reed Exhibitions ensures that each and every event is targeted and relevant to industry needs. As a result, many our events are market leaders in their field.

Find more information about our projects in Russia

+7 (495) 937 6861

www.reedexpo.ru

Why Reed Exhibitions?

• Twice a year we survey both exhibitors and visitors and collect their opinions about our exhibitions and use this knowledge in developing our events.

• For all our shows we regularly acquire, and carefully analyze the industry research from reputable companies which allows us and subsequently you to always be ahead of the market.

• A collective international experience and reach of our global teams give us access to best ideas and trends which we implement and highlight in our events.

• We know how to find, identify and invite to our events the right target visitor; our unique visitor communication mix, extensive experience and broadly available resources allow us to reach your clients practically everywhere, on a public transport, at home, via both traditional and e-mail and most certainly by calling them personally.

• We possess and maintain the top class and sophisticated data management software designed to execute carefully planned and targeted communication and email, analyze effectiveness of various communications and their efficiency.

• Each and every of our exhibitions always have an internet platform that provides both exhibitors and visitors with access to match-making, smart online directories and mobile applications, everything to ensure and enable seamless establishment of contacts.

• We constantly develop and improve loyalty programs for our customers.

Take your chance

to grow your business!

Book your stand today:

Alexander Kalyagin

E: alexander.kalyagin@reedexpo.ru

T: +7 (495) 937 6861