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Naturals: Innovation Helps But Lack of Labeling May Hurt

The natural personal care market is more than a passing fad, according to Nancy Mills, industry manager for the consumer products division of Kline & Co. In her market report, "Market Research, Naturals Market Resists Recession Posts Strong Global Growth," Mills notes that the natural beauty market survived the recessions due to better raw materials, consumer awareness and more affordable natural products. However, she finds that many manufacturers are formulating more 'natural-inspired' products than truly natural products.

Kline & Co. conducted an ingredient analysis to report that 75% of natural personal care products do not live up to their natural claims. According to Mills, "The overwhelming majority are considered 'natural-inspired,' comprised mostly of synthetics with just enough natural ingredients thrown in to take advantage of low consumer differentiation. Unfortunately, the lack of explicit standards that define the degree of naturalness in most markets makes it possible for manufacturers in some countries to call their products 'natural' just by adding a flowery label to the package."

Brazil is the second largest country market for naturals, according to Kline’s Natural Personal Care 2009, a report conducted by Kline & Co. on the natural industries in the United State, Europe, Asia, and Brazil. According to Mills, a single supplier controls nearly two-thirds of the Brazilian market. The Asian naturals market remains strong, according to Mills, with a 40% share of the market. Although Ayurvedic medicine and Traditional Chinese Medicine contribute to the growth of the natural markets in India and China respectively, Mills finds that the lack of labeling standards in these countries may hurt their naturals market. In Europe, less than one-third of natural products are truly natural, according to Mills. That number, however, is growing as manufacturers reformulate products to meet demands of certifying bodies. In the European natural personal care market, mineral makeup is seeing large growth.

In the United States, manufacturers also are reformulating products for natural positioning. In this naturals market, hair care is the fastest growing category. Manufacturers reportedly are still struggling with the availability of raw materials for cleaning, lathering and shining qualities for hair care products. Recent raw material innovations, however, are said to be benefiting this challenge.

Mills reports that overall growth in the naturals industry is expected to average just over 12% through 2014. She notes that understanding individual natural markets can lead to successful natural personal care products, but only if the manufacturer delivers truly natural products.

 

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