Beauty Nutrition Flourishes with Plethora of Brands and Expanding Retail Channels

The beauty nutrition (or beauty from within) market segment is experiencing double-digit gains as consumers embrace the benefits of ingestible supplements to improve their hair, skin, and nails. In fact, the market grew by close to 12% from 2019 to 2020, according to Kline’s recently published Beauty Nutrition: U.S. Market Brief report (available here: https://bit.ly/3s5GkgJ).
 
The pandemic accelerated the growth of these brands via online channels. Social media and influencers are driving popularity and trial among younger consumers, particularly Millennials.
 
In addition, there has been an increase of benefits emerging as beauty nutrition brands are being combined with ingredients that support joint health or sleep and/or prevent anxiety and stress.
 
Previously, these products were sold mainly in specialty stores geared toward cosmetics and other topical beauty products, such as Ulta and Sephora. However, the segment was recently mainstreamed across various retail channels.
 
Consequently, the types of companies that market brands in this space have evolved and now face competition from supplement manufacturers as well as food, beverage, and beauty players, among other companies.
 
For a quick, visual look into the current and future state of the beauty nutrition market, download Kline’s highlights report, Beauty Nutrition: Market Trends, Growth, and Innovation (available here: https://bit.ly/3yDpiJl).

 
Heritage vs. Emerging Players

The beauty nutrition market was previously dominated by a limited number of players, mostly within the mass retail environment, but there has been a significant increase in the number of beauty nutrition brands in recent years. Since 2015, brands such as Nutrafol, Evolution_18, SugarBearHair, and Care/of have entered the market.
 
These new entrants are exploring online specialty channels and using social media to sell their brands; many of them fall in the premium segment category. On the other hand, heritage brands are innovating and entering the market with new product forms while expanding their product portfolios and distribution channels. Most leading brands recorded healthy gains, and the top three brands witnessed double-digit growth from 2019 to 2020.

 
Channel Expansion

Channels through which the brands are sold have expanded beyond specialty retailers, with most drug, food, and mass merchandiser retailers usually stocking several shelves or entire sections with dietary supplement aisles of beauty nutrition products. Online retailers, health food stores, and professional outlets such as hair salons and dermatologists’ offices are additional venues where beauty nutrition products can be purchased.
 
Many companies, such as Nutrafol, Care/of, and Persona, sell directly to consumers via their websites and/or subscription services for personalized supplements. The variety of stores that sell beauty nutrition brands has led to the proliferation of mass, prestige, and specialty brands in the category. In 2020, all retail outlets saw increases, with e-commerce leading the way with a double-digit, all-time high (see Figure 1).

Figure 1. Retail Sales Growth of Beauty Nutrition Products by Retail Channel, 2019-2020

Rising Trends

There are several trends driving consumer interest in this category and double-digit gains for brands.
 
1. Personalized nutrition is gaining consumer attention. Companies are achieving personalization using digital technologies via online questionnaires that generate a detailed nutrition report for an individual, along with product recommendations.
 
2. Self-care and wellness, two key trends that were heightened during quarantine months, have also led to growth of the “beauty from within” concept.
 
3. Common ingredients such as collagen and biotin are the most widely used ingredients in the beauty nutrition segment. Other ingredients being tested for beauty nutrition include natural ones such as mushroom extract and apple cider vinegar.
 
4. Gummies are a trending product form in the industry due to convenience. Most new product launches are in this product form.
 
5. Products with multiple benefits are also resonating with consumers. For example, “beauty from within” will complement other wellness priorities such as joint health and healthy aging.
 
6. Product forms inspired by functional foods (e.g., creamers, powders, collagen bars, and snack bites) are a trend driven by functional food companies.
 
7. Social media marketing is widely used by major players that partner with celebrities or influencer agencies to boost their online presence.

 
What’s Next?

Product innovation will be a key area to drive growth of the beauty nutrition category in the coming years, with brands focusing on natural ingredients, new product forms, and consumer needs. Botanical, vegan, and clean-label ingredients and formulations with clinical trials to support claims will be the key focus of innovations.
 
For example, Moon Juice is innovating products with medical mushrooms and ayurvedic ingredients. Many companies are exploring adaptogens for overall well-being. Microbiome (microorganisms-based) and probiotics-based skin care are also a focus area of innovation for future products.
 
The currently trending product form, mainly for female consumers, is gummies, with companies innovating to provide sugarless and vegan forms. Further innovations may come from functional food ingredients in the beauty snacking category, including bars or bites. Innovation will be focused on providing solutions to consumers on specific beauty needs, such as acne, skin glow, and hair problems. Expanding distribution channels and increasing merger and acquisition activities will continue to fuel growth in the segment over the next several years.
 
Kline’s recently published Beauty Nutrition: U.S. Market Brief report (https://bit.ly/3s5GkgJ) highlights growth opportunities, leading and emerging players, and potential acquisition targets in this highly dynamic segment. The study analyzes a variety of ingestible products designed to nourish skin, hair, and nails from the inside out.

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About the Author: Laura Mahecha is an Industry Manager at Kline, a worldwide consulting and research firm dedicated to providing insight and knowledge that helps companies find a clear path to success. The firm has served the management consulting and market research needs of organizations in the agrochemicals, beauty & personal care, chemicals & materials, energy, and life sciences industries for more than 60 years. For more information, contact Laura.Mahecha@klinegroup.com or visit www.klinegroup.com.