ORGANIC BEAUTY MARKET FOCUS

Organic beauty plays a distinct role in Europe and brands in this sector are making waves.Annemarie Kruse analyses the key markets, their emerging trends and the challenges they face

market grew 7% to t920m in 2013, accounting formore than 7% of the entire personal care market.

The most important mass market brands arecolour cosmetic label Benecos, skin and body carerange Nonique and Luvos, Speick and Sante. Inthe upper mass market there are Lavera and i+mNaturkosmetik, as well as Primavera and Logocos’Logona and Heliotrop ranges.

The premium category includes Santaverde,Farfalla, Annemarie Börlind and Tautropfen. Asone of the few Demeter-certified brands MartinaGebhardt is an important player, as is AlvaNaturkosmetik. Most of these brands also have awide international distribution.

Then there are the proprietary beauty brands –and this makes the German organic market uniquein Europe. No other country has such a widerange of certified own label ranges and thedrugstores, especially DM and Rossmann, take aleading role here. Both retailers have verysuccessful certified ranges, with products pricedbetween t2 to t6.

DM’s Alverde was founded in 1989. The brandhas a high rate of NPD; in the face care categoryalone the line-up offers some 40 sku across eightranges. Alverde also manufactures hair, bath andbody care, make-up, baby care and sun care.Products are attractively packaged and there arefrequent limited editions. Add to this the low pricepoint and broad availability – all of DM’s 1,480German outlets carry the range – and it is notsurprising that Alverde is one of the most popularcertified brands in Germany.

Rossmann’s Alterra brand was launched in thelate 1990s and includes face care, colourcosmetics, bath and body care, hair care and suncare. The line-up is smaller than Alverde’s butAlterra is also popular, for much the same reason

as DM’s brand: a wide range of affordableproducts that is available in all of

Rossmann’s 1,840 German stores.The long-standing heritage and

wide mass market distributionmeans that organic beauty in thiscountry has reached the mainstream.For 2014, industry experts estimatethat sales of certified organiccosmetics will break the t1bnturnover mark. With its plethora ofstrong brands and establishedmanufacturers, Germany is one of themost innovative markets in theinternational organic beauty industry.

French flairAfter Germany, France is the mostimportant market in Europe. Accordingto organic cosmetics associationCosmébio, the market for certifiedorganic cosmetics grew to t380m in2012 and accounts for a 3-4% share of

Bio is booming. Sales of organic beauty aregrowing steadily, not just in the European marketsbut also in the US and in Asian countries like Japan.

According to research company OrganicMonitor, the global market for natural andorganic cosmetics reached $9.7bn in 2012, while astudy by Transparency Market Research has foundthat the worldwide natural personal care sector isexpected to reach a total of $13.2bn by 2018.

These figures include certified organic andnatural-inspired brands. And here we already haveone of the major challenges facing the organicbeauty industry – the question of definition. Whatdoes “organic” mean and what is the differencebetween organic and natural cosmetics?

Leaving aside the semantic difficulties – inEnglish, French and German the terms “organic”,“natural” and “bio” are used very differently – therule of thumb is that any product which has beencertified by an official association - in EuropeBDIH, Ecocert and NaTrue are the biggest labels- is considered organic.

Any product that doesn’t carry one of these sealsis considered near-natural or natural-inspired. Sowhen discussing established organic markets likeGermany or France, the distinction betweencertified and non-certified brands is crucial.

Taking the leadThe biggest European organic beauty market isGermany. Organic cosmetics have a long traditionhere: the two best-known brands, Weleda and Dr.Hauschka, were founded in 1922 and 1935respectively. The Börlind group was established in1959 and in the 1970s and 1980s another slew oforganic companies appeared on the market,including Lavera, Logocos and Primavera.

The result is that organic beauty is well andtruly rooted in the German C&Tmarket. Certified brands areavailable in every retail channeland at every price level, fromdiscounters and drugstores overconventional and organicsupermarkets to pharmacies,Reformhäuser, perfumeries anddepartment stores.

According to organic consultancyNaturkosmetik Konzepte’s annualstudy, the German certified organic

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Alverde (below) andLavera (right) are amongthe most popularcertified organic brandsin Germany

BIO DIVERSITY

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and So’BiO étic, the dermatologically positionedEau Thermale Jonzac and body care brandFloressance par Nature.

The French organic market is also characterisedby a wide range of niche brands, and Paris basedorganic perfumery chain Mademoiselle Bio offers anespecially large selection of these labels. Theretailer’s webstore is the biggest organic onlineperfumery in France and sells some 100 nichebrands. Labels include premium brand Nohèm, skincare range Pulpe de Vie, anti-ageing range ThémisParis, teen brand Lady Green and luxury label Aïny.

Indeed, this is one of the differences betweenthe French and German markets. Germany isdominated by big companies like Logocos andBörlind and strong labels in all retail channels.France, on the other hand, has a large number ofsmaller organic brands with limited distribution.

Knittel confirms: “Looking at the membershipfigures of Cosmébio, ten years ago there wereperhaps 50 member companies, in addition tofewer than ten international brands. Today thereare more than 500 certified brands in France.However, in 2011 some 78% of Cosmébio’smembers had an annual turnover of t500,000 orless. Many of these brands are very small, havetrouble being visible and therefore have littleimpact. My estimate would be that only 30-40organic brands really play a role in the market.”

Even so, the comparatively wide choice of massmarket brands, strong international players like

the French personal care market. However, market growth has slowed in recent

years. Michel Knittel, a consultant for the organicand cosmetic industry and editor of organicmagazine Bio Linéaires, says that the Frenchorganic beauty market is currently leveling off: “In 2013 turnover of organic cosmetics grew only4%. Compared to the 20-30% growth which theorganic beauty market registered in 2006/2007,this represents a significant slowdown. In 2010industry experts had still predicted a 30% marketshare within the next five years. Instead, organicbeauty sales have remained stable, around at best4% of the market.”

As in other European markets, the number oforganic beauty brands in France has significantlyincreased over the last five to ten years.Department stores like Monoprix andsupermarket chains like Auchan, Casino andCarrefour have all introduced certified beautyproducts in their own label ranges, although mostbrands offer a limited product choice.

Conventional brands have also launchedcertified ranges, which means that organic beautyis now represented in most retail channels.Pharmacy brand Nuxe, for example, introducedNuxe Bio Beauté whilst mass market brand Mixa(LaScad/L’Oréal) brought out Mixa Bio andcolour cosmetics brand Bourjois (Chanel)launched Une Beauty.

Leading organic brands include Melvita(L’Occitane), which was founded in 1983 and hasbecome very successful internationally, with storesin London, Moscow and Tokyo. Two other well-known brands are Cattier and Sanoflore (L’Oréal)while Couleur Caramel is an important player inthe colour cosmetics category. All of these brandsare also present in other European markets.

Organic manufacturer Léa Nature’s beautybrands, on the other hand, are mostly available inFrance. The company’s portfolio includes babycare range Natessance, skin care ranges Lift Argan

28 ECM April 2014

Trend watch: Beautyjad.deJulia Keith is a professional beauty blogger. HerGerman blog Beautyjagd.de has 50,000 readersper month and her special expertise is organiccosmetics, product trends and ingredients. Shetalks to ECM about trends in the internationalorganic beauty market

What’s happening in the European organiccosmetics marketplace?Over the past few years I’ve noticed two producttrends which offer an intriguing contrast. On theone hand, you have organic companies followingthe lead of the conventional beauty market andintroducing sophisticated and segmented productslike eyeshadow primers or BB creams. On theother hand, many recent launches seem to begoing back to the roots and traditional productslike bar soaps or face and body oils – presented instylish packaging – are becoming popular again.

Which international brands are currently makinga splash in the market?As far as make-up is concerned, French and US

brands like Couleur Caramel, RMS Beauty or IliaBeauty are offering very innovative products.Northern European countries like Latvia, Finlandand Denmark are also in the focus of attention atthe moment. Organic brands like Mádara, Kivvi orUnique are drawing on their natural heritage andlocal ingredients whilst offering stylish andmodern products.

How will the European organic beauty marketdevelop over the next years?The whole market is very much in motion at themoment. The continuing consumer demand fornew products means that a lot of exciting brandsand concepts are appearing on the scene. Thedevelopment of innovative ingredients to helpformulate new products will continue to be ofprime importance. The role of certification inhelping consumers decide between organiccosmetics and natural-inspired products will grow even further – especially since theconventional cosmetics market is also becoming greener.

Melvita is France’slargest certified organicbeauty brand, offeringover 300 products

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company has more than 40 stores and 450 outletsacross the UK and reported double digit growth forthe past year. Another fast growing organic beautycompany is Bamford, which runs a luxury spa inGloucestershire and supplies bath and bodyproducts to five star hotels and leading UK retailersincluding Fortnum & Mason. Bamford more thantrebled its organic turnover in 2013.

Other certified UK brands that are making animpact include premium ranges Pai Skincare,Inlight Organics and Aurelia Probiotic Skincare aswell as the labels Balance Me, Cowshed and Evolve.

Organic cosmetics are traditionally sold inhealth food stores or in organic supermarkets likeBritish chain Planet Organic or US chain WholeFoods Market, which entered the UK in 2007.Many of the biggest British supermarkets havealso tried to bring organic into mainstream retail:Tesco with BNatural, Waitrose’ Organic Body andBath line and Sainsbury’s Organic You toiletries –however, all of these have since been discontinued.The most premium supermarket of the mix,Waitrose, does however still stock Neal’s Yardtoiletries, Avalon Organics hair care and GreenPeople sun care and deodorants.

Health and beauty retailers seem to have hadmore success with their ranges. Boots added a lineof organic facial skin care to its popular own labelrange Botanics in 2007, which today consists ofseven products with Soil Association-certifiedingredients. Superdrug also launched its firstcertified range, Purity Organic Skin, in 2009. Therange comprises seven products and is available insome 400 Superdrug stores.

Still, the choice of certified beauty products inthe UK is not particularly wide. Most organicbrands are located firmly in the premium pricerange and unlike Germany and France, thecountry is still lacking a broad distribution ofaffordable certified cosmetics.

Northern beauty One of the big trends at the moment are beautybrands from Scandinavia and the Baltics. Thisregion is really making waves and scores of newand interesting labels have appeared on the scenein recent years.

Hilla Naturkosmetik, founded by Finnish-bornSirkku Hahn in 2013, is a German online retailerspecializing in niche Scandinavian and Balticbeauty brands. Many of Hilla’s brands are artisanalcompanies with a strong focus on regionalingredients and a premium price point.

Hahn comments: “In the Scandinaviancountries we don’t have big manufacturers likeLogocos in Germany, at least not yet. There aremostly small companies. In my opinion, however,this is an advantage. These small brands have anauthentic character and originality since they werenot designed for mass market distribution or themainstream beauty market.”

One of the best known Nordic brands isMádara, which comes from Riga in Latvia.Mádara was launched in 2006 and has managed tobuild up an impressive international presence injust a few years. Also from Latvia is Dabba, a smallcompany founded in 2011 which makes herbal

“UK sales of certifiedorganic healthand beautyproductsgrew by astaggering17% in 2013”

Melvita and Couleur Caramel and a remarkablerange of niche labels make France one of the mostexciting organic markets in Europe.

Mediterranean flavoursItaly and Spain are two of the smaller Europeanmarkets. In both countries, however, organicbeauty is starting to play a distinct role.

According to Italian C&T association CosmeticaItalia, turnover of natural-inspired and organiccosmetics grew 3.5% in the first half of 2013 andthe total figure for 2013 is estimated to reacht410m. Compared to Germany and France, theItalian organic beauty market is very small. Certifiedbrands are difficult to find, although plant basedcosmetics have a strong heritage in Italy – there iseven a special retail channel, the herboristerieswhich sell herbs, plant based cosmetics andsupplements. Four of the better known organiclabels in Italy are Biofficina Toscana, Natura, Bjobjand Planter’s Cosmetica Naturale.

The Spanish organic beauty market shares someof Italy’s characteristics, especially the growingconsumer interest in organic products. Althoughthere are no organic mass market brands to speakof, in recent years a whole range of interestingniche labels have appeared on the market. Naobay,for example, offers face and body care packaged inwooden containers and is primarily sold online.Mona & Leo is another premium skin care brandwhich is available in small beauty salons andthrough e-commerce, while face and body carebrand Naáy Botanicals is also mostly sold online.

Matarrania features face and body care based onolive oil. Packaged in stylish glass bottles, this isanother brand that is primarily available online.Amapola Bio is based in Segovia and specialises infreshly made cosmetics. The portfolio comprisesface and body products, baby care and men’s care.A few years ago the company opened its own storein Barcelona, but products are also sold through a webshop.

Meanwhile, artisanal brand Naturavia comesfrom the region of Galicia. Its portfolio includesbath and body care as well as face and baby care.Naturavia is mostly sold online, although productsare also available in selected organic stores across Spain.

The organic beauty markets in Spain and Italystill have a long way to go. The lack of certifiedmass market brands means that organic beautyremains a premium category, and as bothcountries are struggling with high unemploymentand a lagging economy, not many consumers canafford to splash out on luxuries. However, theinterest is definitely there, as the surge of neworganic beauty brands shows.

Island organicsOver in the UK, the organic beauty market isgoing from strength to strength. According to theSoil Association, sales of certified organic healthand beauty products grew by a staggering 17% in2013 to £37.2m. The market leader is Neal’s YardRemedies, which was founded in 1981 in London’sCovent Garden market and produces a range ofbeauty products, herbs and supplements. Today the

Finnish brand Frantsila(below) has beenmanufacturing organicproducts since 1981,and is a pioneer inorganic herb growing

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face sprays based on local ingredients. KivviOrganics and Anna Liepa, two other Latvianlabels that are making a name for themselves, alsofocus on regional ingredients.

Joik is an Estonian brand which started in 2005with a range of soy candles and then branched outinto cosmetics. Although distribution is selective,Joik has become so successful that the brandentered the Japanese market in 2013. Elsewhere,two recent and exciting additions from Iceland areskin care brands Alkemistinn and Sóley Organics.

Not all Scandinavian organic brands are new orniche, of course. Danish mass market brandUrtekram, for example, was founded in 1972 andhas a wide distribution outside of its own country,especially in Germany, while Finnish brandFrantsila was established some 30 years ago and isconsidered a pioneer in the area of organic herbalagriculture in Finland, according to Hahn.

Even so, in the Scandinavian countries theorganic beauty markets are just starting to develop.Certification, for example, does not as yet play abig role here. Hahn explains: “Many organicbeauty manufacturers are small family-ownedcompanies. For these companies, the expenditureand effort of getting products certified oftendoesn’t seem worthwhile, especially since theirlocal customers don’t demand a certification.”

In addition, distribution channels are differentfrom other European markets. In Finland andSweden, for example, there are no drugstorechains like in Germany or the UK. Hahn says:“Over here organic cosmetics are sold in the morepremium department stores, health food storesand organic speciality stores. However, some ofthe bigger supermarkets recently started offeringorganic brands, which should definitely boost thegeneral distribution of organic beauty.”

She adds: “The awareness of natural cosmeticsis growing. But although there are criticalcustomers who research brands and ingredients,there is also a broad group that is easily taken inby brands pretending to be green. But green-washing seems to be an international problem.”

Faking itGreen-washing is indeed a major problem for theorganic industry. In every beauty market there areproduct ranges claiming “natural” ingredients andgreen positioning without any certification to backup these claims. Although the European certifiersare doing their best to guide consumers, themultitude of national labels – like Ecocert andCosmébio in France, BDIH, Demeter andNeuform in Germany, Ecogruppo and ICEA inItaly or the UK’s Soil Association – is only addingto the confusion.

There have been attempts to implement pan-European standards, like the foundation ofNaTrue in 2007, and in 2010 BDIH, Cosmébio,Ecocert, ICEA and Soil Association announcedthe creation of Cosmos, a new internationalcertificate for natural and organic cosmetics.

However, the process of harmonising so manynational standards has been long-winded andthorny; it is very much a long-term project.Indeed, Cosmos recently announced that

Estonian cosmeticsbrand Joik hasexperienced doubledigit growth and startedto export its range toJapan last year

“It is notenough forthe finishedproduct to be organic.Ethics andsustainabilityare equallyimportant”

following yet another set of revisions, the newstandard would not be implemented until 2016.

Playing fairAnother important issue is the question of fair trade.The modern eco-aware consumer is difficult toplease. It is not enough for the finished product tobe organic: the ethical background of a companyand the sustainability of every single aspect of theproduction chain is equally important.

In the era of search engines and social media, anycorporate misstep is quickly punished by the public.Authenticity and transparency have thereforebecome key considerations for organic beautybrands. Social responsibility is crucial, as could beseen in the recent debate about the engagement ofGerman beauty manufacturers in China.

European cosmetics are popular with theaffluent Chinese middle class and organiccosmetics, especially those made in Germany, areconsidered to be particularly high quality. SeveralGerman companies, including Logocos, Lavera,Kneipp and Weleda retail their products in China.

However, any foreign cosmetics brand thatwants to enter the Chinese personal care markethas to undergo a series of product tests, includingtesting on animals. It doesn’t matter whether thebrand in question is certified according toEuropean standards: animal tests are mandatory.

For an organic manufacturer with a socialconscience, this poses an obvious ethical problem.In 2012 a series of German media reports turnedthe spotlight on this animal testing issue. Organicand vegan publications took up the baton andstarted questioning beauty companies about theiractivities in China. In the end, criticism fromconsumers was so severe that in December 2013Logocos decided to withdraw entirely from theChinese market, while Lavera announced that itwould suspend its activities until the Chineseauthorities agreed on waiving animal testing forEuropean certified organic products.

The big certifiers also took a stand. InDecember 2013, BDIH stated that evensubmitting an application to register products inpreparation for a Chinese market entry wastantamount to ordering animal testing, and inJanuary 2014 NaTrue announced that it wouldban the marketing of NaTrue certified products inChina and all non-EU countries requiring animaltesting for foreign products.

A permanent fixture“Organic” is more than just a fad. It’s aninternational phenomenon and as part of theglobal ‘neo-ecology’ megatrend, the importance oforganic, sustainably manufactured products is onlygoing to increase in the future.

This also applies to personal care. Organic brandshave started to play an important role in mostEuropean C&T markets. It is clear that, althoughthe individual countries differ radically in terms ofdistribution and market dynamics and markets likeItaly and Spain still have a lot of catching up to do –especially when compared to Germany andFrance – organic beauty is more than a trend. It is here to stay.

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