Marketers Play Loose & Fast With Natural’s Definition

Despite high interest in natural and organic cosmetic products by European consumers, the market is highly fragmented with very few brands having a strong presence throughout the region. The main issue is in the definition; natural is a very loose term and open to interpretation. Does it refer solely to ingredients, or the way they are sourced? Does a product containing products “inspired by nature” qualify? These are issues that constantly exercise the minds of brand owners and marketers and have yet to be resolved by the numerous conflicting natural, organic and ethical labels.

According to Datamonitor Consumer’s Q2 global survey 2015, 54% of Europeans would buy beauty or grooming products that claim to contain natural ingredients, compared to 31% who are tempted by the claim “from natural sources,” or the 15% who respond to products “inspired by nature.” German consumers are most likely to say they would buy beauty products containing natural ingredients (60%). Among the top five European countries, the French are least likely to go for this claim (46%), however, they are more inclined to choose beauty products “from natural sources” (38%). 

Organic Monitor valued the European natural and organic cosmetics market at around €3 billion in 2014 and claims it is growing 5-7% a year. Weleda is the European market leader, with a strong presence across the region. Its market share is rising partly because of its strength within the German market, which remains the largest in Europe.

Opportunities for Growth
Across Europe, there are some 400 natural and organic brands, providing opportunities to target specific consumer groups. In male grooming, Bulldog has made an impact with its natural male grooming range and Parisian cult skin care brand 66’30 specializes in organic ingredients in its ecologically positioned facial products. Meanwhile, 100 Active Bodycare is an English shower gel product made from 100% natural ingredients and is said to assist recovery after sport.

Demand for natural is particularly important within the context of the growing “anti-pollution” trend.

“Using natural ingredients can represent a more appealing way to counter the negative effects of ‘man-made’ pollution,” noted Jamie Mills, associate analyst, Datamonitor. “Given that pollution is thought to increase the level of free radicals in the skin and cause oxidative stress, it is no surprise that antioxidants form an important part of many pollution targeted formulations.”

With many sources of antioxidants found in natural ingredients, such as tea, quinoa and green coffee, there are opportunities for brands to differentiate their offer with more novel ones. An example is Dior One Essential City Defense, which was launched in France. It has a “beauty shield” whose key active ingredient is red hibiscus, which is said to provide a deep detoxifying action to the skin. Planeta Organica’s Secrets of Arctica Face Mask, launched in Russia, is another example of a natural brand using novel ingredients, which include Arctic peat, kaolin and Icelandic moss.

Ethical Labels Proliferate
There are more than 20 symbols and logos representing natural and organic cosmetics in Europe. According to Amarjit Sahota, chief executive officer, Organic Monitor, there have been more ethical label launches in the past two years.

“We are seeing products now certified Vegan Society (popular in Germany), Fairtrade (UK, France) and similar labels like gluten-free,” he observed. “In the whole cosmetics industry, we are seeing new ethical labels emerge, like Nordic Swan, EU Eco-Flower and Halal.”

Organic Monitor will discuss the proliferation in eco-labels at the forthcoming Sustainable Cosmetics Summit Europe, which will be held Oct. 21-23 in Paris.

In an attempt to cut through the clutter of confusing logos and symbols, Cosmos is seeking to be the international standard for natural and organic beauty. According to Emma Reinhold, trade relations manager, Soil Association Certification, the challenge will be implementing it internationally, particularly beyond Europe.

“The standard has now been adopted by ACO in Australia, which further strengthens its international reach,” she stated. “However, the industry needs to have one clear strong message on certification to send to brands and consumers. Together, the Cosmos partners account for 80% of the global certified beauty market, which we believe sends that strong message.”

In relation to newly-launched products or reformulated products, all labels will have to bear the Cosmos logo and corresponding certifier symbol from January 2017 (as well as to formulate to the Cosmos standard).

“We need to draw a line in the sand for implementing Cosmos fully, however existing certified products will still be able to use their existing labeling,” commented Reinhold. “The Cosmos partners are working to agree on a timeframe to move everyone over to Cosmos. This, as you can imagine, has its complexities, but progress is being made.”

Despite confusion over labeling, there is plenty to be optimistic about. Fiona Klonarides, beauty commentator and founder of The Beauty Shortlist blog, maintains that all the pointers for natural and organic beauty are positive.

“In the UK, the Soil Association reported a 20% spike in sales of organic health and beauty products and forecasters are banking on double digit growth in the foreseeable future,” she said. “British brands like Neal’s Yard Remedies, Ren, Antonia Burrell, Cowshed, Barefoot Botanicals and more recently, Pai Skincare and probiotic-centric range Aurelia has also settled nicely into the US. I think Therapi Honey Skincare, founded by beekeeper Tanya Hawkes, is one to watch.”

Phyto Power!
The sector will continue to evolve and mature, with more sophisticated products making strong performance claims. Klonarides has noted the emergence of phyto-powered skin care.

“What I call ‘modern organics’ with a core of science-meets-nature intelligent ingredients will do extremely well,” she said. “As consumers are becoming increasingly averse to potential toxins and allergens, they are reading labels more, supporting sustainable brands and are happy to pay for high performance natural/organic skin care.”

Much depends on the acceptance of harmonized certification, in particular the acceptance and implementation of Cosmos.
“Ultimately, if the market continues to thrive, more formal definitions and standards will need to be adopted to protect its integrity,” concluded Reinhold. 

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Imogen Matthews
Headington, Oxford UK
Tel: +44 1865 764918

Imogen Matthews is a respected consultant, journalist and researcher focusing on trends in the beauty industry. She regularly contributes to many of the world’s foremost beauty trade titles. Every year in April, she publishes The Premium Market Report, focusing on trends in the UK premium beauty markets.
www.thepremiummarketreport.com