Thriving Against Giants: How Challenger Brands Compete Against Big Name Brands in South African Beauty

Lessons From How Leading Challenger Brands

 

On a cold Saturday morning, Siya looks out expectantly across the empty St George’s Park before letting out an anxious sigh. She lowers the heavy bag from her back, placing it beside a worn steel table, aware that one wrong move could cost her dearly. She lays down a white cloth, then attentively arranges a variety of jars and bottles across the market table; each landing with a soft, deliberate thud. Adjusting the cloth a last time, she takes a step back and surveys her entire stall; her gaze slowly shifting from one end of the table to the other before she nods silently to herself.

Siya is quietly worried about the declining number of people coming to the markets in recent months. She’s not wrong to be concerned; across South Africa, everyone is feeling the same squeeze. We’ll explore how four leading challenger brands have established their positions in the market, growing from the market-day stage, like Siya, to become notable contenders in the space. 

 

 

 

 

Spending Pressure, Preferences, and “Buying Down”

 

People are navigating a difficult economic climate marked by low economic growth, high unemployment and the ever-increasing cost of living. This pressure has had a noticeable impact on spending patterns; Nielsen’s latest data shows a 4% dip in the FMCG market value over 2024. For challenger brands, this presents a unique opening for “value-conscious premium” offerings.

 

 

Though people are under financial strain, they are not abandoning quality or their values. Instead, they are seeking products that deliver perceived premium benefits, such as natural ingredients, sustainability, or specialized formulations, at a more accessible price point than traditional premium offerings.

 

The South African Fast-Moving Consumer Goods (FMCG) market, with an estimated R845.6 billion in sales value according to recent Nielsen data, is a dynamic landscape characterized by significant consumer spending pressures and intense competition from established brands. Strategic approaches adopted by leading challenger brands, like Kafui Naturals, Ubuntu Traditional Balms, and SKOON, enable the creation of a resilient offering that can stand its ground against dominant players.

 

 

 

 

 

 

 

 

Distribution Realities

 

 

Between customer interactions, Siya slips behind her table to check her phone: notifications for overdue production, packaging and delivery invoices. Each, landing like a silent blow, fueling the fear gently swelling within her; would any of this be worth it? Infrastructure constraints and high transportation and logistics costs, particularly when reaching township or rural areas, pose a serious hurdle for many FMCG categories.

 

The traditional route to access the national consumer market is concentrated in a handful of organized retailers and wholesalers; think chains like Shoprite and Pick n Pay, or intermediaries like Metro and Makro; Shoprite alone commands 30% market share according to a report by North Star.

 

 

To gain access, new manufacturers must front inventory costs without the retail credit lines typically extended to retailers. National and regional wholesalers often demand high minimum order amounts to justify distribution, which smaller entrants can struggle to meet for shelf space.

 

 

Additionally, a Trade Intelligence report suggests, South Africa has a multitude of spaza shops, which form a fragmented informal trade segment serving approximately 70% of South African households. This sector grew by 5.2% in 2024, driven by the convenience and proximity it offers for small, frequent, and often cash-based shopping missions.

 

E-commerce has emerged as the fastest-growing channel within the FMCG sector, boasting a remarkable 40% year-on-year growth. This surge is likely largely propelled by the expansion of on-demand platforms such as Checkers Sixty60, PnP asap!, SPAR2U, and Woolies Dash.

 

Recognizing its significance, both retailers and producers are increasingly directing their focus towards selling to informal traders. One such producer is Tiger Brands, which expanded its presence to over 70,000 township stores and spaza shops by the end of 2024.

 

 

 

 

The South African landscape necessitates a dual approach to mastering both digital and informal channels, presenting a strategic opportunity for challenger brands. Leading challenger brands are typically digital natives, leaning heavily into their e-commerce and social engagement capabilities for reach in urban areas. This approach leverages their agility and lower overhead costs, allowing them to penetrate markets that larger brands, with their often rigid traditional structures, may struggle to serve efficiently.

 

 

 

Kafui Naturals: Tapping into Indigenous Knowledge

 

 

 

Kafui Naturals is a great example of how evoking a nostalgia for a simpler ancestral time can, through tapping into indigenous knowledge, become a brand pillar for differentiation. Kafui Awonoor, a wellness and natural hair expert, founded the beauty brand after noticing a gap in organic and natural products for hair and skincare in Cape Town; from this, Kafui Naturals was born.

 

Kafui Naturals distinguishes itself through being deeply rooted in traditional botanical wisdom and African identity, focusing on natural, chemical-free hair and skincare products.

 

By positioning itself on indigenous knowledge, Kafui is not just selling beauty products; it’s selling a narrative of cultural wisdom. This approach cues other positive associations in our minds, such as ‘natural’ or ‘pure’, which then become attributed to the brand as well.

 

Growing up, Kafui’s grandmother would make shea butter; inspired by these memories, she began making her chemical-free products at home. Her products were so popular with friends that she began showing them at market pop-up events, where they would sell out quite quickly. Kafui is primarily a digital-first brand using Instagram, Faithful to Nature, featured at the V&A Waterfront Watershed, and recently available from the Nudefoods store as key distribution channels.

 

 

 

Ubuntu Traditional Balms: The Power of Heritage

 

 

 

Ubuntu Traditional Balms exemplifies the strength of a heritage-driven market positioning. Rooted in a small, family-owned pharmacy established in 1948, the brand leverages decades of traditional-remedy knowledge and a 75-year-tested formula approach. Ubuntu partners with specialized retailers, such as pharmacies, to provide targeted access to their core audience, reinforcing their expertise in the eyes of customers.

 

 

The balms, meticulously pharmacist-made in small batches using traditional methods, further underscore their credibility. By fusing the extensive heritage and an artisanal small-batch production approach, the brand crafts a highly differentiated offer. The specialized skill of the founders, combined with scarcity implied by the production style, boosts trust in the product efficacy and perceived value.

 

The brand’s commitment extends beyond product efficacy to social impact, employing women from the community and supporting other small African businesses. Ubuntu utilizes a multi-pronged distribution approach, offering courier and post office delivery, alongside in-store pick-up at major pharmacies. Their presence at the V&A Waterfront’s Watershed also aligns with their local, artisanal appeal.

 

 

 

 

 

SKOON: Digital Personalization

 

SKOON has carved out a significant niche in the South African beauty market with its compelling value proposition centred on natural, cruelty-free, and non-toxic clean beauty with lab-formulated combinations. The brand blends local ingredients such as Rooibos and Baobab, alongside ingredients like Nkuto Butter from Ghana and phyto-compounds from France.

 

 

 

The brand weaves together pan-African heritage with cutting-edge cosmetic science to create a uniquely defined space in a crowded market. Dermatological endorsements and certifications lend credibility, while the blend of regional ingredients with clinical innovation invites intrigue and positions them as sophisticated visionaries.

 

Founder Stella Ciolli built the local customer base through the brand’s website, skincare salons, and eco-conscious e-commerce retailers, such as Faithful to Nature. Beyond this direct-to-consumer approach, the brand has expanded its physical distribution through a presence in Woolworths and Foschini.

 

 

 

 

 

 

SKOON also leverages a Visual Quiz Builder (VQB) on its website, asking customers a concise set of questions regarding their skin type, concerns, and lifestyle.

This interactive approach allows SKOON. to provide tailored skincare regimen recommendations, significantly improving the customer experience by addressing the common challenge of navigating complex product choices.

This hyper-personalization led to an 8.7% increase in purchase conversion rate (3.5 times higher than the store average) and an impressive 78% email capture rate.

 

 

 

 

 

 

 

 

 

 

Hermosa Flor Cosmetics: Inclusivity & Influencer Leverage

 

Hermosa Flor Cosmetics sets itself apart in the cosmetics space by offering a product for beauty and make-up enthusiasts typically excluded by the high costs of quality products.
The brand provides high-end products with a range that caters to darker skin tones at a more affordable price point compared to big-name brands.

The brand’s positioning is a testament to the power of social proof, especially when bolstered by inclusivity in a space that had generally lacked it, and its ability to reinforce a sense of ownership. The brand’s digital native edge is evident in its rapid growth, accumulating over 74,000 Instagram followers with high engagement in under three years.

 

 

 

The brand employs a highly effective influencer-led go-to-market strategy, which maximizes Mbali Sebapu’s existing social media following as its founder, to foster trust and generate immediate demand. This personal connection and large organic following bypassed the need for large initial marketing budgets. The instant presence this built for the brand and marketing helped them grow 80% during COVID, according to Mbali.

Inclusivity and customer-centricity are core to Hermosa Flor’s identity. The brand is dedicated to actively platforming Black content creators, addressing the historical lack of representation in the beauty community.

The approach contrasts with the often more expensive and less authentic macro-influencer collaborations. The brand strategically opts to partner primarily with micro-influencers to achieve more authentic and detailed product reviews, thereby broadening its audience reach effectively. Hermosa’s channel strategy consists of four stores in Pretoria and Cape Town, with their product also available in Botswana and Eswatini.

 

 

 

 

 

 

Find Your Gap & Own It

 

 

South Africa’s FMCG market, while presenting significant challenges from consumer spending pressures and logistical complexities, is simultaneously rich with opportunities for agile and innovative challenger brands. The success stories of Ubuntu Traditional Balms, SKOON, Kafui Naturals, Hermosa Flor Cosmetics, and the principles they embody offer a compelling blueprint for growth.

The journey of these featured brands offers powerful lessons:

1. 1. 1. 1. 1. 1. Clarity about who your offer is for and why they should care is vital
               2. E-commerce can be a game-changing growth engine
               3. Sustained growth requires diversified distribution channels to reach more customers

 

Ultimately, a relentless focus on understanding and serving the diverse needs of your customers is the recipe for thriving against even the most entrenched incumbents.

 

As dusk approaches and the market day winds down, Siya gathers her remaining jars and notes today’s sales in her notebook. She remembers the cold morning sigh and smiles as she reflects on how many customers resonated with the family legacy behind her recipe and journey.

 

 

 

 

 

 

 

 

 

Sources and references:

• North Star (2019) Northstar Quarterly Market Report
  https://www.northstar.co.za/wp-content/uploads/2019/07/Northstar-Market-Report-Q2F.pdf
• Lauren Fernandes, Nielsen IQ (March 2025) Finding Harmony on the Shelf 2025 Global Outlook on Private Label & Branded Products:
  https://nielseniq.com/global/en/insights/report/2025/finding-harmony-on-the-shelf/
• Bizcommunity (April 2025) NIQ report reveals opportunities for private label FMCG growth in South Africa
  https://www.zawya.com/en/economy/africa/niq-report-reveals-opportunities-for-private-label-fmcg-growth-in-south-africa-pisvj2bg
• Nielsen IQ (November 2024) NIQ Retail Barometer: South Africans spend R214 billion on FMCG and durable goods in Q3 2024
  https://nielseniq.com/global/en/news-center/2024/niq-retail-barometer-south-africans-spend-r214-billion-on-fmcg-and-durable-goods-in-q3-2024/
• Businesstech (May 2024) The biggest retailers in South Africa: Shoprite vs Woolworths vs Spar vs Pick n Pay
  https://businesstech.co.za/news/trending/772654/the-biggest-retailers-in-south-africa-shoprite-vs-woolworths-vs-spar-vs-pick-n-pay/
• Media Update (May 2025) Trade Intelligence Releases SA FMCG Market Size and Channel Report
  https://www.mediaupdate.co.za/marketing/159118/trade-intelligence-releases-sa-fmcg-market-size-and-channel-report
• Nqobile Dludla, Reuters (August 2024) Tiger Brands expands presence in South African townships
  https://www.reuters.com/business/retail-consumer/tiger-brands-expands-presence-south-african-townships-2024-08-01/
• Fin24 (June 2023) Should your small business be offering discounts?
  https://partners.24.com/own-it/should-your-small-business-be-offering-discounts/index.html
• Ubuntu Traditional Balms (June 2025)
  https://www.ubuntutraditionalbalms.co.za/traditionalremediesbloghttps://www.ubuntutraditionalbalms.co.za/ourstoryhttps://www.ubuntutraditionalbalms.co.za/ourstory
• SKOON. (June 2025)
  https://www.skoonskin.com/pages/about-us
• Silvertree (October 2019) Silvertree Holdings invests and accelerates local natural sHkincare brand SKOON.
  https://www.silvertreebrands.com/news/silvertree-holdings-invests-and-accelerates-local-natural-skincare-brand-skoon
• Visual Quiz Builder (2024) How SKOON. personalized skincare for customers and notched 3.5x conversion
  https://www.visualquizbuilder.com/post/how-skoon-personalized-skincare-for-customers-and-notched-3-5x-conversion
• Keshia Africa (2023 )SA’s leading women entrepreneurs:
  https://iol.co.za/weekend-argus/lifestyle/2022-08-28-sas-leading-women-entrepreneurs/
• Mpambo Sekelwa (December 2023) 5 Ways Hermosa Flor Is Disrupting The Cosmetics Industry:
  https://nounouche.online/5-ways-hermosa-flor-is-disrupting-the-cosmetics-industry/
• Nokubonga Thusi (August 2022) Mbali Sebapu is building her beauty empire one ‘add-to-cart’ at a time:
  https://www.timeslive.co.za/sunday-times/lifestyle/fashion-and-beauty/2022-08-21-mbali-sebapu-is-building-her-beauty-empire-one-add-to-cart-at-a-time/