Global Natural Cosmetic Sales Approaching US $7 Billion

Global sales of natural & organic cosmetics are soaring with revenues projected to approach US $7 billion this year. New research by Organic Monitor finds that North America and Europe are the two engines of growth, comprising the bulk of the US $1 billion sales increase.

The major drivers of market growth are the mainstreaming of natural & organic cosmetics, inward investment and growing consumer demand for green products. Distribution of natural and organic cosmetics is increasing in supermarkets, drugstores, and pharmacies across North America and Western Europe. Investment is coming in from large cosmetic manufacturers, retailers, private and financial investors.

Europe has seen most retailer investment with a number of leading mass market retailers launching natural & organic cosmetics in the last year. The leading British supermarkets are marketing natural & organic cosmetics under their private labels. However, most retail investment has been in Germany where even discounters have launched certified natural cosmetics.

Investment is also coming from large cosmetic companies who are either acquiring dedicated natural & organic cosmetic companies or launching certified products. L’Oreal is eyeing further acquisitions since buying Sanoflore and The Body Shop in 2006. Origins Natural Resources, part of Estee Lauder, has launched a certified organic cosmetics line under the Origins Organics banner.

New Product Development (NPD) has become a key feature of the natural cosmetics market. By adopting private standards like Ecocert and Soil Association, cosmetic manufacturers are forced to innovate through product formulations. Companies are experimenting with natural preservatives, surfactants and colourants as they move away from synthetic chemicals.

The major challenge the industry faces is lack of regulation, with many pseudo-natural products competing with legitimate natural and organic cosmetic products. Differences in natural ingredient compositions and the variation in private standards could dampen consumer confidence in natural & organic products.

Related report: The  Global Market for Natural & Organic Personal Care Products

Posted: September 17th 2007

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