Nurturing the culture of beauty

The German Cosmetics Distributors and Marketing Association (VKE) was launched 60 years ago to represent the interests of the distributors and manufacturers of high-end cosmetics. In the intervening years, not only the entire cosmetics market but also the range of the association’s activities has constantly changed and expanded.

As daily life gradually returned to normal after the war, people in Germany felt a growing desire to nurture and relive the culture of beauty and to do so with relish, passion and style. From the outset, the VKE embodied these values.
Since then, the association has represented the common professional interests of the specialist providers responsible for the marketing of perfumes, cosmetics and body care products in the medium, high and luxury price segments. Over the years, the number of members has grown so that the VKE now encompasses almost 60 companies. Together they represent more than 200 brands, some of them world famous, with annual sales of almost 2 billion euros in Germany. However, the key factor is not the size of the individual companies or their sales volume, but rather their adherence to the qualitative criteria of selective distribution, which requires intensive consulting.

Underpinning the selective distribution system

From the outset, the VKE’s priority has been to bolster the self-image of selective distribution cosmetics and to manifest this at all levels of political and economic life. Much emphasis is placed on further strengthening the position of the selective distribution system and on cultivating its image in the high-end cosmetics market. The main concern is to ensure the broad distribution of a wide range of high-quality products by competent, authorised suppliers – an aim that is actively pursued by the “Selective Distribution and Law” working group, which was founded in January 2001.
Another area of activity of the VKE, which as an industry association acts as a central hub for the exchange of information between scientific experts, end-consumers, professional associations and government institutions, is ensuring compliance with strict European consumer protection standards. Other key issues are combating product piracy and imports of cosmetics from so-called grey markets as well as retaining fair competition in the cosmetics market.
Here, the cooperation which the VKE entered into with the German Brands Association in 2001 plays an important role. The two associations have bundled their common interests with regard to distribution and branding policies and also pooled their existing expertise in the fields of brand development, brand maintenance and, above all, trademark and competition law.
In the perfumes and cosmetics segment, the German customs authorities seized counterfeit goods worth 1.3 million euros in 2011 alone, while an unknown quantity of counterfeit cosmetics find their way to the consumer via unauthorised distribution channels such as Internet auction platforms. The VKE therefore supports a wide range of initiatives in order to enable the global pursuit of intellectual property theft.

Pro-active consumer education

Public relations is another key focus of the VKE’s work. The association is a competent partner when it comes to consumer behaviour issues, market data and studies, trends, developments, consumer protection and the law.
In addition, it coordinates the work of the Fragrance Foundation Germany, whose objective is to oppose the trivialisation of perfume, which is part of our cultural heritage, and to promote its appeal. Each year, the foundation presents its DUFTSTARS Fragrance Awards.

In 2011, companies involved in selective cosmetics distribution recorded their most successful year for more than ten years. Those companies represented by the VKE posted an above-average increase in sales of 5.2 per cent year-on-year. The reasons for this are to be found in the strong quality brands, the high degree of innovative strength and constructive approaches towards further market development. In addition, a revised sales policy in perfumeries has raised consumer awareness of brand values.
But there are always new challenges to face. For example, the VKE considers it essential – both now and in the future – that its member companies respond to the increasing buying power of the retailers, also in the cosmetics industry, and require them to submit convincing concepts. The trade’s constant focus on price, the at times unsatisfactory presentation of brand environments, an inappropriately dominant own brand policy and logistical issues represent a particular challenge. Two projects which have therefore been implemented in close cooperation with retailers or are currently being implemented are the multi-client “Fragrance and Cosmetics” study, which examines the way in which customers perceive the range of perfumes on offer, and the “Master Data Selective Cosmetics” industry guide.
Finally, the VKE recognises its responsibility to prevent excessive regulatory interference at both a European and a national level in order to avoid competitive distortion.