Writing in its annual Organic Beauty and Wellbeing Market report, the Soil Association said 2021 had been a challenging year economically, with the COVID-19 pandemic and Brexit both taking a considerable toll on organic beauty and wellbeing businesses in the UK. But 2021 had also seen a shift in consumer buying behaviours that favoured environmentally friendly products as conscious consumerism evolved into a mainstream trend. And this, the report said, had tipped the balance to see organic beauty and wellness flourish in the face of a difficult year plagued by trading pressures, ingredient shortages, price increases and longer lead times.
Organic beauty and wellness propelled into ‘mainstream’
Sales of Soil Association certified organic and natural beauty and wellbeing products grew by 15% in 2021, pulling in €164m (£138.23m) and marking the 11th consecutive year of growth for the category. In 2021, 50,000 products and ingredients were also certified by the COSMOS standard, with sales of COSMOS certified products up 32% in 2021 versus 2020.
“This remarkable growth is largely down to the significant interest in health and wellness, coupled with the greater visibility of environmental issues such as climate change in the media which has propelled the organic sector into the mainstream as consumers seek to align their purchasing decisions with their principles,” said Clare McDermott, certification business development director at Soil Association.
A widening consumer understanding of beauty ingredients and growing demand for transparency from brands were also fuelling interest in organic beauty and wellness, according to the report.
“We predict these trends will continue into 2022 as the sector influences the wider beauty market and the availability of organic beauty and wellness products grows,” the Soil Association said.
“…The organic beauty and wellness sector has never been in such a strong position to meet industry and consumer demand as the convergence between beauty, health and the environment continues to grow in 2022.”
However, the Soil Association said continued growth would not be without its challenges.
Brexit-related supply chain issues ‘top challenge’ in 2022
According to certified companies surveyed for the Soil Association’s annual report, Brexit had been a key reason for some of the sales declines seen in 2021 and continued to pose a concern looking forward.
The survey found 88% of certified companies believed supply chain issues to be the top challenge looking ahead for 2022, with 50% citing export and import issues and 63% citing inflation – all related to Brexit. CosmeticsDesign-Europe recently reported that supply and transport issues had been the biggest challenge for UK beauty suppliers in 2021.
The Soil Association said ingredient and product innovation and extra work around environmental education would help spur growth despite the challenging trading landscape.
“In an industry driven by the desire for the new, the beauty sector’s growing interest in upcycling represents an exciting opportunity for organic ingredients suppliers. Zero waste is fast becoming one of the biggest trends in beauty, as suppliers utilise waste wherever they can and use every part of the crop,” it said.
Not only did upcycled ingredient innovation tap into consumer desires and environmental needs, it often carried financial benefits too, the report said, noting waste and overall costs could both be reduced.
Beyond this, the Soil Association said there was also scope to stretch organic innovation beyond traditional beauty and personal care categories – into segments like home care, oral care and fem care – as consumers looked to live more holistically. The Soil Association already certified more than 300 non-beauty, wellness related products, for example.
E-commerce organic beauty and wellness sales gain ground
E-commerce would also continue to be an important platform for growth and innovation in organic beauty and wellness, as online beauty continued its surge – now representing 20% of total beauty sales worldwide. And online sales growth was “even more prevalent” in the organic beauty and wellness space, the Soil Association said, with one-quarter of certified brands making between 31-40% of sales online and 13% of certified brands selling 91-100% online.
“Many brands have pivoted their retail strategies in 2021 focusing on more direct-to-consumer initiatives and new routes to market including social media and online marketplaces. Pre-ordering has become popular with organic beauty brands, helping to ease the supply chain and ingredient availability pressures that have affected many brands over the past 12 months,” the report said.
Overall, the Soil Association said there was a promising future for certified organic beauty and wellness brands to grow business and gain market share.
