Organic Cosmetic Trade Booming

LONDON - Sep 17/07 - SNS -- The international market for natural and organic cosmetics is expected to generate around U.S. $7 billion in sales this year, with Europe and the United States accounting for most of the growth.

New research by Organic Monitor (www.organicmonitor.com) finds the major drivers of market growth are the mainstreaming of natural and 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 and organic cosmetics in the last year. The leading British supermarkets are marketing natural and 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 and 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.

Organic Monitor projects global natural cosmetics market revenues to surpass US $10 billion before 2010. At that time, the market share of natural and organic products of total cosmetics is projected to near 10% in countries like Germany and the US.

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 and organic products.

Defining a natural and organic cosmetic product, a major industry concern, is the subject of the technical seminar at the first-ever conference on Natural Cosmetics and Sustainability: Natural Beauty Summit Europe in Paris. The seminar will tackle technical and formulation issues companies face with natural and organic cosmetics. Organic Monitor will also present its latest findings on the global market for natural and organic cosmetics at the inaugural event on November 29 and 30, 2007.