Bio-Oil, a South African skin care remedy, has designs to continue its growth spurt by entering the U.S. market.
Owned by the Cape Town company Union-Swiss, Bio-Oil was originally used to heal scars created by surgery, acne or chicken pox. Over the years, the company found that its product was being used on stretch marks and for other problems, such as dehydrated skin and uneven skin tone. Company research showed that less than 20 percent of sales were generated by consumers purchasing the product to treat scars.
In recent years, the 20-year-old company has expand its distribution to the U.K., Ireland, New Zealand, Australia and, most recently, Japan. The U.S. is the 15th market Bio-Oil has entered over the past four years.
“Bio-Oil is the number-one selling skin care product in 10 of the 14 countries it’s available in as of this year,” said Mark Corbett, Union Swiss’ regional business manager, who added that Australian Nielsen data ranked Bio-Oil’s 60-ml. bottle number one out of 8,133 skin care products tracked in pharmacies last year, while the 125-ml. version ranked number six.
Bio-Oil plans to launch the 60-ml. bottle for $11.99 in U.S. mass retailers this March. The product is composed of a non-greasy protective formula that contains natural plant extracts and vitamins in an oil base, which is said to help the ingredients maintain their maximum potency. The ingredients — vitamins A and E, calendula, lavender, rosemary oils and chamomile extract — are then combined with PurCellin Oil.
“The oil provides a better storage environment for the active ingredients,” said Corbett, but added the formula feels like cream since it is quickly absorbed into the skin.
The company estimated Bio-Oil would generate global retail sales of between $60 million and $70 million by the end of the year. Corbett estimated the U.S. launch would generate about $20 million in retail sales by the end of 2007.
Walgreens is the only confirmed U.S. retailer, but the company plans to have distribution in more than 20,000 doors over the next year.
Bio-Oil will be supported by a $7 million advertising effort that includes television, slated to break in May, and print ads planned for April.