Cosmetics have become necessary items in life because they can improve an individual’s overall appearance, and thus have a positive impact on one’s personality. A few multinational corporations have monopolized the production of such items. They provide a wide range of products, including face care, hair care, and lip care, among others that are necessary to meet the end-user’s needs.
Furthermore, increased anti-aging cosmetics product launches, the development of innovative and comfortable packaging designs, and compressed containers that can be easily transported on the go are attracting consumers. Each person has a unique hair type, skin tone, eye color, and lip shape. As a result, manufacturers are working on developing and maintaining a diverse product portfolio capable of meeting the unique needs of each individual.
Fortune Business Insights notes that the cosmetics market size was valued at USD 287.94 billion in 2021 and will grow to USD 415.29 billion by 2028 with a CAGR of 5.0% during the projected period.
COVID-19 Witnessed a Decline in Product Sales
The COVID-19 crisis has stunned the cosmetics industry, resulting in a significant drop in demand for cosmetic products. Furthermore, as a result of the strict quarantine and prevalent store closures in the first half of 2020, consumer purchasing patterns in the beauty and personal care space have changed significantly.
Retail store closures accelerated the shift to online channels, creating opportunities for manufacturers. According to L’Oréal’s 2020 annual results, published in February 2021, the company’s e-commerce sales increased by 62% across all divisions and regions, accounting for approximately 26.6% of company sales in 2020.
As a result, players in the beauty industry are attempting to streamline their supply chains and focus on expanding online sales during the pandemic period. On the other hand, the opening of offline stores would enhance sales volume in the near future.
Grooming to be the Primary Reason for Market Growth
Concerns about one’s body and well-being are growing on a daily basis as a result of a hectic schedule, changes in routine, eating habits, and sleep cycle fluctuations. Beauty products can improve the quality, cleanse, and beautify external body parts, allowing people to appear healthier and more attractive. As a result, these are some of the factors that have resulted in high product demand from both the young and old. Furthermore, the growing popularity of sun care products, night skin repair creams, soothing fragrances, and hair colors is expected to surge the product demand.
E-commerce Growth and Advanced Marketing Solutions will Be Notable Trends
Various market participants are launching digital marketing strategies, developing interactive advertisements, and making significant efforts to promote their products through social media, which is expected to boost the product demand. Consumers are increasingly turning to e-commerce to purchase personal care products due to the growing influence of social media and increased internet penetration. For example, in August 2019, Grupo Boticário, a Brazilian beauty products company, planed to purchase Beleza na Web, an e-commerce platform for selling its products. To meet the needs of customers, the industry is focusing on trying to offer a large number of products via an online channel.
Side Effects and Access to Surgical Options to be a Huge Market Challenge
Cosmetics products contain a variety of synthetic chemicals, including preservatives, pigments, and other additives, which can have severe side effects on the body, including adverse reactions, the formation of black patches, acne, or darkening, and others. This is due to the accumulation of toxic chemicals in the body as a result of chronic exposure to these products.
These factors are also shifting consumer preferences toward cosmetic surgeries, which can permanently alter their appearance, and thus help them reduce their use of beauty products on a daily basis. As a result, rising customer awareness of the negative effects of cosmetics products is expected to limit the market growth of cosmetics.
Sustainable Cosmetics to be a Game Changer
Natural-derived ingredients-based products are gaining popularity around the world due to their safety and non-toxicity. The growing population’s awareness of the importance of sustainability is expected to increase the demand for eco-friendly products in the near future. This is due to increased consumer awareness of the harmful effects of synthetic chemicals on health and the environment.
Furthermore, consumer preferences are shifting toward vegan products that do not encompass any animal-derived ingredients. Additionally, manufacturers are focusing on providing sustainable packaging, such as paper-based, biodegradable, and refillable packaging options, to attract more users while reducing their carbon footprint.
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