Brazil
www.natura.net

Sales: $3.6 billion.

Key Personnel: Roberto Marques, executive chairman, Natura & Co; João Paulo Brotto Conçalves Ferreira, chief executive officer; José Filippo chief financial officer; Agenor Leão, vice president, Latin America; Erasmo Toledo, vice president, direct selling; Josie Peressinoto Romero, vice president, operations and logistics; Andréa Figueiredo Teixeira Álvares, executive officer of marketing, innovation and sustainability; Flavio Pesiguelo, vice president, people and culture; Itamar Gaino Filho, vice president, legal; David Boynton, chief executive officer, The Body Shop; Michael O’Keeffe, chief executive officer, Aesop.

Major Products: Cosmetics and personal care products sold through Natura, Aesop and The Body Shop.

New Products: Natura—Essencial Oud (male and female fragrances); Natura Homem COR.AGIO (male fragrance); Chronos sistema de clareamento (Chronos Clearing System); Una Nude Me Base Sérum FPS 18 (Una Nude Me Serum Foundation SPF 18); Tododia Lima e Flor de Laranjeira (Tododia Lime and Orange Flower, it comprises body care products); The Body Shop—Yogurt Leite de Amêndoas (Almond Milk Body Yogurt); Men’s Grooming collection; Japanese Cherry Blossom Strawberry Kiss line (Eau de Toilette, Body Mist, Shower Gel, Moisturizing Cream and Lotion); Drops Of Youth Eye Treatment Mask 2 in 1; Aesop—Köln Travel Kit roll-on deodorants; Brass Oil Burner.

Comments: Natura is getting bigger—much bigger. In May, the largest cosmetics maker in Brazil agreed to acquire Avon in a stock swap to create what it calls the fourth-largest pure-play beauty group in the world. According to Natura, the acquisition creates a best-in-class multi-brand and multi-channel beauty group, with direct connections to consumers on a daily basis. The group will hold leading positions in relationship selling through Avon´s and Natura’s over 6.3 million consultants and representatives, a global footprint through 3,200 stores, as well as an expanded digital presence across all companies. The combined group is expected to have annual gross revenues of over $10 billion, over 40,000 associates and be present in 100 countries.

As part of this transaction, a new Brazilian holding company, Natura Holding S.A., has been created. Based upon the fixed exchange ratio of 0.300 Natura Holding shares for each share of Avon common stock, Natura & Co’s shareholders will own approximately 76% of the combined company, while Avon common shareholders will own approximately 24%.

Upon closing, the board of the combined company will consist of 13 members, three of which will be designated by Avon. The transaction is subject to customary closing conditions, but is expected in early 2020.

At the end of 2018, Natura had more than 1 million consultants in Brazil. Its productivity rose 18% in one year, and the average remuneration jumped 12%; for business leaders (consultants that guide a group of colleagues), it rose 25%. During the year, Natura won market share, brand preference and recorded an increase in sales in all countries of Latin America, where it operates. The highlight was Argentina where, despite the challenging macroeconomic scenario, the company exceeded the overall performance of the local market thanks to the network of consultants and operational efficiency. The total number of consultants rose from 589,000 to 645,000 and grew in all the countries except in Chile, where the numbers were flat.

In other news, Natura became one of the first companies in the world to receive the new international certification of the Union for Ethical Bio Trade in June 2018. The seal appears on Natura Ekos packaging and confirms that all vegetable ingredients follow ethical practices such as fair sharing of benefits through the use of biodiversity and traditional knowledge, respect for labor conditions, income generation, local development and maintenance of ecosystems.

Natura’s move to digital continues. At the close of 2018, nearly 660,000 consultants relied on web and mobile apps in Brazil and Latin American. More than 2.5 million online trainings were performed in 2018, an increase of 40% compared to 2017. One of the biggest news items of the year was the debut of Nat, the virtual assistant in the Natura portal. Through artificial intelligence, Nat helps consultants solve issues related to registration, credit and charging. According to Natura, 60% of issues are resolved without human interaction.

Last year, Rede Natura (Natura Network), the online sales platform, was named the best e-commerce site in Brazil by Ebit, a company that measures the reputation of virtual stores. Moreover, it was recognized for the third consecutive time, as “the most beloved internet store” in the cosmetic and perfumery categories. Rede Natura has 400,000 digital consultants, who sell on the platform using their own pages, and 5 million registered customers. The network topped sales targets by 40%, and at the close of the year. Nat was available in Chile and Argentina, with implementation started in Colombia, Mexico and Peru.

Also in 2018, The Body Shop made history when, on October 4, World Animal Day, The Body Shop and Cruelty Free International went to the UN headquarters in New York, with 8.3 million signatures calling for an end to animal testing in cosmetics. It was the largest petition ever made against the use of animal tests in the cosmetics industry. In other news, The Body Shop’s social media community nearly doubled last year to seven million followers.

Aesop continues to expand around the world. Last year, the Australian-based brand opened its first counter in GUM, the world-famous Moscow department store. Online, Aesop launched in Australia and Canada a live site assistance tool which generated approximately 3,000 interactions and 632 hours of conversation. In Australia and New Zealand, Aesop launched CEGID, a new system to enhance customer experience and inventory management. Finally, Hybris, another e-commerce platform, was launched in more than eight countries.