Natural Personal Care Consumers: Unlocking Future Potential

SUMMARY

Overview

Introduction

Nearly 1 in 3 consumers sought cosmetic and toiletry products with natural credentials more frequently over the period 2005-06. This report explores the key trends driving the boom in natural personal care consumption in the US, Europe and Asia-Pacific. In-depth quantitative data, compelling consumer insight and strategic recommendations make this report a must-have information resource.

Scope

• In-depth quantitative data covering consumption behavior across geographic regions and personal care categories
• In-depth quantitative data covering 3 classifications of natural personal care products: broad, narrow and organic
• Extensive primary research of consumers and senior industry figures to uncover the latest thinking and reveal emerging opportunities
• Detailed recommendations offering practical strategies based on the trends and insights uncovered in the report

Report Highlights

The total spend on natural personal care, including narrow, broad and organic definitions, currently stands at almost US$14 billion in the US and Europe and by 2011 is set to reach over US$20 billion. The US is the largest market at US$7.7 billion and is forecast to exceed US$12bn by 2011.

Across Europe and the US, nearly a third of consumers sought cosmetic and toiletry products that have natural credentials on a more frequent basis in 2005-06. Datamonitor's fieldwork also found that a number of consumers across Europe and the US are now avoiding certain personal care products more due to fears over ingredients.

While the consumer profile of who makes up the 'natural seekers' segment varies on a country by country basis there are some commonalities. These consumers tend to be female mid-lifers from middle-income households who are well educated. New and expectant parents will also drive future usage.

Reasons to Purchase

• As wellness trends increasingly influence personal care consumption, this report is a must-have resource about an exciting growth opportunity
• Understand the attitudes driving the consumption behavior of natural personal care consumers, including 'push' and 'pull' factors
• Improve your marketing by following best-practice guidelines enabling more effective targeting with on-trend products and relevant communications

TABLE OF CONTENTS

• CHAPTER 1 EXECUTIVE SUMMARY
  • The Hot topic
  • The future decoded
  • Action points
• CHAPTER 2 THE FUTURE DECODED
  • Introduction
    • Legislative loopholes create definitional complications
      • It is helpful to segment the market by 'narrow', broad' and 'organic'
      • The narrow definition follows a stricter set of criteria
  • TREND: The overall market for natural personal care has and will continue to grow strongly
    • Combined natural personal care spend in Europe and the US will exceed US$20bn by 2011
    • Growth in the Asia-Pacific region will outpace some European countries
    • More consumers are actively seeking out natural ingredient based products
    • Organic personal care goods are seeing particularly strong growth
    • Narrow definition natural personal care represents the 'core' natural market
    • Broad definition products continue to make up some of the largest markets
    • Sector growth is being driven by skincare and haircare markets
    • Market growth is reflected by product development
  • TREND: Consumers are acting increasingly ethically
    • The proportion of consumers acting ethically is growing
    • Consumers across a broad range of demographics are embracing ethical consumerism
      • Well educated consumers spend more on ethical purchases
      • Lower income families are often untargeted
    • Consumers are increasingly likely to pay more for ethical goods
  • INSIGHT: Core users of natural personal care are becoming more mainstream
    • Many key consumer segments are seeking out natural personal care products more
    • Education, rather than income, is the key driver of organics usage
    • Consumers who seek out Natural Personal care products are more likely to buy ethically
    • Entry points into the market mirror the natural and fresh food industry
  • INSIGHT: Using natural personal care products is not typically an altruistic act
    • Consumers can associate natural personal care with superior effectiveness
      • Some consumers are still wary of natural personal care products' effectiveness
    • Consumers perceive natural personal care products to be healthier
    • Consumers are trying to avoid certain ingredients perceived as harmful to their skin
  • INSIGHT: Many consumers suffer from sensitive skin or rashes as well as skin healing problems
    • Many consumers suffer from but don't act upon their skin concerns
      • Natural skincare seekers are more concerned about skin rashes and sensitive skin
    • Skin dryness is the biggest concern of natural skincare consumers
  • INSIGHT: Consumers respond positively to natural products that are worthy, quality and therapeutic
    • Being 'worthy' is no longer enough for today's demanding consumers
    • Consumers associate natural products with superior sensual quality
      • Sensory needs are driving the switch to natural fragrances
      • Natural materials are being used more in the bathroom as it becomes a key zone for wellness seeking consumers
    • There are a number of popular natural ingredients that consumers are embracing
  • INSIGHT: Consumers lack trust in many mass market brands
    • Natural brands are typically deemed to be more trustworthy
      • Consumer trust in organic food and drink is high
    • Consumers are confused by naturally positioned products
  • Conclusions
• CHAPTER 3 ACTION POINTS
  • ACTION: Develop and tailor strategies towards specific natural classifications
    • Use natural positioning to develop a unique proposition
    • Use your brand to develop cross-over opportunities
    • Seek out acquisition opportunities to gain a stronger market foothold
  • ACTION: Reflect consumers' increasing interest and knowledge of ethical consumerism
    • Natural products should tap the connectivity mega-trend
    • Offer transparency in business practices and socially responsible behavior
      • Show consumers that your CSR activities are not just PR
    • Make verifiable claims about natural products
      • Ensure that claims can be substantiated
    • Make sure your natural ingredients are ethically sourced
      • Case study: The Body Shop Community Trade program
  • ACTION: Target consumer segments with currently low involvement - but ripe for growth
    • Offer products at various price points
      • Develop and improve relevant distribution channels
    • Ensure shelf stand-out as naturals go mainstream
    • Include men in natural personal care offerings
    • Target growth in Tween and Teen consumers
    • Use targeted media and promotions to develop segment-specific campaigns
      • Use the Internet to develop new 'online communities' to inform consumers
  • ACTION: Effectively promote the efficacy of natural personal care
    • Improve the provision of information to consumers
  • ACTION: Focus on the health benefits of natural alternatives
    • Bridge the attitude/ behavior gap by prompting consumers to act on their skin concerns
      • Focus on the benefits of natural alternatives with regard to skin dryness
  • ACTION: Promote themes of 'being worthy', 'quality' and 'therapeutic'
    • Endeavor to assign attributes of quality and premium to products and brands
    • Promote the superior sensory aspects of natural personal care and their associated therapeutic benefits
• CHAPTER 4 APPENDIX
  • Supplementary data
  • Definitions
  • Research methodology
  • How to contact experts in your industry
  • List of Tables
    • Table 1: Total market value for natural personal care (US$ millions), by country and market definition 2001, 2006, 2011
    • Table 2: Per capital value consumption (US$) for natural personal care, by country and market definition 2001, 2006, 2011
    • Table 3: Consumer response to question: To what extent have you sought cosmetic and toiletry products that have natural ingredients or properties more or less in the past year? 2006
    • Table 4: Organic personal care market (US$ m) by country, 2001, 2006, 2011
    • Table 5: Narrow natural personal care market (US$ m), by country, 2001, 2006, 2011
    • Table 6: Broad natural personal care market (US$ m), by country, 2001, 2006, 2011
    • Table 7: Natural personal market (US$ m) by product category, Europe and US, 2001, 2006, 2011
    • Table 8: Natural and organic new product development in personal care, 1996-2006, US and Europe
    • Table 9: Motivators for the use of natural personal care products (% survey respondents citing)
    • Table 10: European 'narrow' natural personal care market value (US$ m) by country, by market segment, 2001, 2006, 2011
    • Table 11: European 'broad' natural personal care market value (US$ m) by country, by market segment, 2001, 2006, 2011
    • Table 12: European 'organic' natural personal care market value (US$ m) by country, by market segment, 2001, 2006, 2011
    • Table 13: Japan natural personal care market value (US$ m) by natural classification, by market segment, 2001, 2006, 2011
    • Table 14: Australia natural personal care market value (US$ m) by natural classification, by market segment, 2001, 2006, 2011
  • List of Figures
    • Figure 1: Natural personal care growth is primarily driven by the health mega-trend but other trends are also influential
    • Figure 2: Natural personal care is best analyzed from the perspective of 'broad', 'narrow' and 'organic' definitions
    • Figure 3: The impressive growth of the US organic market looks set to continue
    • Figure 4: France is witnessing the strongest growth in narrowly defined natural personal care products
    • Figure 5: The US will continue to be the largest broad definition natural personal care market
    • Figure 6: Skincare and haircare will continue to be the largest natural personal care markets in the US and Europe
    • Figure 7: Positive attitudes towards ethical consumption are beginning to translate into actual behavior
    • Figure 8: Proportion of consumers who believed it was 'important' or 'very important' to buy ethical or socially responsible goods in 2004.
    • Figure 9: Proportion of consumers who bought more ethical or socially-responsible grocery items in 2006
    • Figure 10: Consumers with higher education drive ethical spend
    • Figure 11: Willingness to pay more for ethical products by country, 2000-2005
    • Figure 12: Proportion of consumers who actively sought more personal care products with natural ingredients or properties in 2006
    • Figure 13: Consumers of higher education in Europe and the US are more likely to seek natural ingredients in personal care products
    • Figure 14: Consumers who seek out personal care products with natural ingredients are also more likely to buy ethically in general
    • Figure 15: Some consumers 'trade up' their involvement in natural personal care over time
    • Figure 16: Proportion of consumers who deliberately avoided certain cosmetics and toiletries because of fears over certain ingredients more in 2006
    • Figure 17: Spanish consumers have the largest attitudinal gap between being concerned about skin rashes and sensitive skin yet not acting upon this
    • Figure 18: Natural seekers in Sweden, the US and the UK are far more concerned about sensitive skin than their average populations
    • Figure 19: Consumer survey: How much of a concern is skin dryness to you? Natural seekers, by country, 2006
    • Figure 20: Proportion of consumers who have deliberately sought out cosmetics with calming or therapeutic ingredients or properties US & Europe, 2006
    • Figure 21: Only 33% of European and US consumers consider cosmetic and toiletry companies to be trustworthy
    • Figure 22: Consumer trust in natural and organic products relative to conventional food and drink
    • Figure 23: There is a clear link between natural personal care consumer insight and how manufacturers should target consumers in the future
    • Figure 24: The natural personal care classifications of 'broad', 'narrow' and 'organic' have very different characteristics
    • Figure 25: Natural personal care companies are increasingly being targeted for acquisition by bigger mainstream players
    • Figure 26: Perceptions of ethical behavior are becoming more sophisticated
    • Figure 27: Consumer survey: "Which of these ethical commitments would most improve your disposition towards buying a particular company's food, drink or personal products?"
    • Figure 28: Opportunities are available to expand natural personal care more into mass market and super-premium positioning
    • Figure 29: Packaging design should ensure shelf stand-out
    • Figure 30: Targeting natural offerings at male consumers can be successful
    • Figure 31: Develop natural offerings to appeal to the growing Tween and Teen personal care market
    • Figure 32: Efficacy-driven marketing is influenced by product formulation
    • Figure 33: The Internet can be utilized to help consumers learn about the benefits of natural products
    • Figure 34: Natural products should promote their health benefits
    • Figure 35: Focusing on natural products' benefits towards consumers' skin concerns can add value
    • Figure 36: Natural personal care can offer attributes of both 'worthy' and 'quality'
    • Figure 37: Therapeutic and sensual qualities can be received very well by consumers