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Multinationals jump on natural cosmetics bandwagon, but will consumers will shun them?

L’Oreal’s recent launch of Seed Phytonutrients is the latest foray of multinationals in the natural and organic cosmetics market. Unilever has also launched the Love, Beauty and Planet brand in the last 12 months. Both brands are looking to capitalize on consumer demand for ‘clean beauty’ products.

More Natural Product Launches (NPL) are expected from multinationals –  but Ecovia Intelligence suggests not all will be successful. As will be shown at upcoming the Sustainable Cosmetics Summit and Natural Cosmetics Masterclass, the global natural and organic cosmetics market has many intricacies. 

Retail sales of such products have grown from almost nothing to USD 10.2 billion between 2002 and 2017. 

Consumer are turning to natural and organic products to avoid contentious synthetic chemicals in cosmetics and toiletries. The primary motive is avoidance of parabens, SLS / SLES, and chemicals with associated health risks. But many consumers are also buying such products because they want to support small independent ethical brands. 

Prior to the NPL route, the favoured mode of entry of multinationals was acquisitions. Yet, not all have provided dividends. In 2007, L’Oreal purchased The Body Shop and the organic cosmetics brand Sanoflore. The former brand was sold off to Natura Brasil last year, whilst Sanoflore remains a ‘marginalised’ brand. Critics argue that L’Oreal’s recent purchase of the Logona and Sante brands will suffer the same fate. Since purchasing the Logocos business in August, some organic food retailers in Germany are considering de- listing. 

Ecovia Intelligence sees consumer acceptance as a major challenge for multinationals. Research shows consumers identify with small, ‘indie’ brands with green values; the same consumers typically shun green products of large corporations.

As ethical consumerism becomes mainstream and natural and organic products continue to make inroads in conventional channels, the multinationals know they cannot ignore this important trend. Large companies like L’Oreal and Unilever will continue to hedge their bets between developing green products and outright acquisitions, suggests  covia Intelligence, while market winners will be those who can successfully align brand values to consumer expectations. Others, the company predicts, are likely to underperform as they find the green road is littered with obstacles. 

Sustainable Cosmetics Summit Asia-Pacific 12-13 November, Hong Kong Natural Cosmetics Masterclass 15 January, San Francisco 

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About the Author

Jim Manson

Writer & Editor
Jim Manson is editor-in-chief of Diversified Communications UK‘s natural and organic publishing portfolio. He’s written widely on environment and development issues for specialist magazines and national media, including the Financial Times, The Guardian, The Times, and World Bank Urban Age

Articles by Jim Manson

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