According to Kline & Company’s newly published Natural Personal Care: Global Market Brief report, the natural personal care market posted a healthy 10.6% increase globally to reach USD 29.5 billion at the manufacturers’ level in 2013.

By 2018, the natural personal care market is projected to post an increase of 9.2% – to reach $46 billion.

The natural personal care market has been experiencing double-digit growth since 2008, and has seen a compound annual growth rate (CAGR) of 11.3% over the last five years.

Carrie Mellage, vice president of Kline’s Consumer Products practice, commented:

“Although growth numbers have settled, many factors, including a focus on new natural ingredients, the opening of new channels of distribution, and consumer movement demanding greater transparency in labeling, are stimulating the industry. Moreover, marketers are offering products specifically designed for specific demographic groups like men and babies, thereby opening up greater opportunities.”

Where are natural prodicts being sold?

It varies by region. Health and natural food stores rank first in the United States.In Europe, pharmacies dominate the scene while mass outlets post the highest growth. Direct sales lead in Brazil.

Certified Natural or Natural-Inspired?

Due to high manufacturing costs and limitations of natural preservatives, natural-inspired products are preferred by many manufacturers and they dominate the market.

However, encouraged by growing consumer awareness and improved technology, several companies are seeking to reformulate their existing product lines to remove synthetic ingredients. With no strict government-mandated directives and standards, various certifying agencies are taking initiatives to regulate the market, but the challenge is to scan for its naturalness. Additionally, only a few marketers take the initiative to approach the certifying agencies to get their products certified.

China and Brazil

According to Kline, China and Brazil are the fastest-growing natural personal care markets. Sales in China increased nearly 24% in 2013 – and are slowly challenging the United States’ global market share.

Zachary Ferrara, project lead for Kline in China, noted:

“Within the flourishing Chinese market, while both domestic and foreign brands are enjoying growth, domestic ones still claim an estimated 80%+ share of the market. Notably, of these local players, those offering mostly TCM (traditional Chinese medicine) products account for approximately less than two-thirds of the Chinese natural personal care market. However, international natural brands are becoming more accepted by Chinese consumers as they are considered to be of a higher quality.”

Several global brands have entered the Chinese natural beauty market during the last five years, including Jurlique (2009), Kiehl’s (2009), and Origins (2010).

The strength of the Brazilian market is being driven by leading marketers Natura and O Boticario, which collectively claim an estimated 85% total market share. The Brazilian market is well-developed with regards to sourcing of organic and natural ingredients, but companies still have a high concentration of synthetics in their formulations.

Mark Your Calender…

Kline will be presenting key insghts from the report duirng a free webinar on January 28, 2014, 11:00 am EST. Register here.