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December 30, 2016
No longer a niche movement favored only by hardcore natural evangelists, nontoxic beauty is thriving—and the innovative, high-performance products entering the space are proving that the category has staying power. Natural and organic personal care experienced an 8 percent sales increase in natural retail in 2015, according to Natural Foods Merchandiser’s annual Market Overview. Even more telling about its future: Its growth surpassed that of both food and supplements in the natural channel last year.
So what’s driving this sales boost? Medical breakthroughs are proving some of the risks associated with cosmetics chemicals—and mainstream media is covering it. But interest in the space isn’t as closely tied to fear as it once was. Thanks to innovation and performance, demand is more about want than want not. New, mission-driven companies are launching impressive products and inspiring us to make healthier personal care choices; existing companies are reformulating in a more sincere way; and consumers are connecting the dots between health, beauty and sustainability.
Today, nontoxic personal care is contributing to larger movements tied to both the future of consumer wellness and to innovative, do-good business models. And many of the trends we believe are shaping the future of the natural and organic personal care space are manifestations of today’s larger top-of-mind issues—those of health, environmental sustainability, trust and integrity. Now, who says beauty is only skin deep?
It’s critical to address the relationship between health and beauty when it comes to natural beauty’s growth, and a key piece of this puzzle is the microbiome—the millions of bacteria and biomes found in and on the human body. The rapidly growing gut-health category is no longer linked only to digestion, according to NBJ's 2016 Healthy Solutions Report, which shows that gut health is increasingly being tied to immunity, brain health and more, including skin health. As a result, we predict that the skin care and nutricosmetics will start capitalizing on the role of healthy bacteria in healthy skin.
The concept hasn’t exploded just yet because, well, it’s young and it’s complicated. Manufacturers and marketers must figure out exactly what these solutions can look like. What we do know is that research shows that skin actually has its very own microbiome and that our internal microbiome relates to skin health. Early approaches to supporting the skin’s microbiome are threefold: ditch harsh synthetic skin care that can attack "good bacteria;" support your internal microbiome with probiotics, since mounting research shows gut bacteria imbalances can contribute to acne; and, finally, experiment with topical probiotics that can help balance the skin’s microbiome.
This last approach holds the greatest challenges and opportunities, which industry experts are beginning to explore. According to David Keller, vice president of scientific operations for probiotic ingredient supplier Ganeden, challenges to effective topical probiotics include shelf stability and shelf life (dead bacteria are not probiotics, the company points out), research on specific strains and their targeted beauty benefits, and FDA compliance. The company is addressing these by investing in a research-backed anti-aging ingredient called Bonicel that is derived from probiotics. "When probiotic bacteria grow, there are many beneficial byproducts that are produced," Keller says.
We can’t wait to see what’s next.
The craft movement is alive and well—a result of consumers demanding full ingredient transparency and craving a stronger connection to products—and, it’s not just showing up in chocolates, coffees and brewskis. Much like these products have done so successfully, personal care companies are getting back to basics in order to cater to a market that’s hungry for craft products and authenticity.
Craft and DIY beauty is going strong as more consumers shift toward safer, cleaner personal care products and crave the knowledge about where ingredients come from. As a result, more shoppers are turning to bulk bins for ingredients that support healthy skin, hair and nails; and companies committed to apothecary-style packaging and simple, authentic messaging abound, particularly for simple products like soaps and body lotions. "Craft and artisan soaps have really caught our customers’ attention," says Jonathan Lawrence, director of vitamins and body care and general manager at Illinois-based Fresh Thyme Farmers Market. "They love the idea of going back to the basics and making products by hand. This adds to the unique shapes, scents and overall appeal in the same way that craft beer has exploded."
Another trend emerging as part of this movement is hyperlocal and even foraging for beauty. Hall Newbegin, founder of Berkeley, California-based body care company Juniper Ridge, forages domestic woodlands for ingredients to use in soaps, body washes and other personal care products. "We go out to the mountains and harvest the plants, then distill out their goo," he says. "You’re getting a real experience of fragrance. People are rightfully afraid of fragrance because there are so many synthetic scents out there."
Both value and high-end beauty products are appearing on natural retailers’ shelves—and, depending on the retail environment, there is certainly room for both, especially when retailers focus on creating dynamic shopping experiences for different types of beauty consumers (think the shopper used to purchasing in department stores or salons, as well as those who buy beauty at drugstores or convenience stores). Sales of NOPC products in natural retail are significantly outpacing those in conventional for these categories because natural retailers are bringing product diversity, deep education and stringent standards to the table.
But natural beauty distribution outside of natural retail is where we can expect to see some developments in 2017. Conventional retail will continue to stock more natural options, while also dabbling in local or regional offerings and building some holistic beauty education into the mix. Meanwhile, more high-end/luxury retailers will bring certified organic, biodynamic and fair trade offerings into their aisles, as opposed to just products simply touting a few plant-based ingredients. Finally, we expect to see drugstores, universities, airports and other convenience-oriented retail outlets bringing more natural options into the mix.
One of the biggest barriers to acceptance of natural beauty products was the perception that they didn’t "work." This was particularly an issue in categories like oral care and deodorants. Today, however, companies are committed not only to formulating with the right amounts of the right ingredients but also to convincing shoppers that these products work as well as their conventional counterparts. Our NEXTY Award winner Schmidt’s Deodorant is leaving its mark on the natural deodorant industry and proving that there is a natural solution that gets the job done. For this company, the best way to get consumers on board is to get them to try the product. Meanwhile, natural skin care companies focusing on antiaging, clear skin and more are putting their products to the test in order to earn consumer trust.
Regardless of which beauty category a company is in, we will continue to see brands rising to the occasion—and raising the bar. Skin, body, hair and nail care featuring gentle, plant-based active ingredients that also lend clinical results was once a pipe dream. Today, that’s what responsible companies are delivering. "Ten-plus years ago it was very rare to find the words scientifically proven or clinically proven on a product label at your local health food store," according to Jeremiah McElwee, founder and chief thinkubation officer at Thrive Market and Simply Fair Skin Care. "Like most of the natural products industry, the skin care products you find on shelves today are far more efficacious and higher quality than they ever have been." Our prediction: they’ll just keep getting better and better.
Waste has been one of the most important topics in the food industry—as manufacturers, advocacy groups, retailers and more explore ways to "save" potentially wasted good food and distribute it where it’s most needed. But food isn’t the only industry that needs to address waste. Today, repurposed plants are showing up in everything from soap to face cream. What started with ancient cultures using discarded ingredients in unique ways is transforming into green chemistry innovations, according to Kantha Shelke, PhD, CFS, principal at Corvus Blue LLC, a Chicago-based food science and research firm. "Biotechnologists are now advancing this practice in a more systematic manner to find ways to recycle and valorize agro-food industry by-products."
A few brands we’ve seen making the most of waste include Further Products, which makes soap from glycerin left behind from converting depleted restaurant waste grease, and The Grapeseed Company, which leverages upcycled wine ingredients in its bath and body products. Other large scale initiatives such as The European BioRice Project are taking shape to explore how rice byproducts can be used for the beauty industry. And organizations including FoodSolutions Team and Phytonext are repurposing a range of vegetable wastes using green chemistry methods.
Also expect to see more happening in waste-free packaging in the beauty space. Innovative botanical papers processed eco-efficiently from plant waste such as coca husk from the chocolate industry, coffee chaff and cellulose from rice are some of the most up-and-coming potential solutions to wasteful plastic packaging.
It’s a very, very rare occasion that the FDA will actually ban a cosmetic ingredient (after all, the U.S. has banned only around a dozen cosmetic ingredients, while Europe has banned more than a thousand). So despite years of dialogue and contention around triclosan, a common ingredient used in soaps and other "antibacterial" products, this year’s triclosan ruling to ban the chemical ingredient from soap was a significant event that has some serious long-term implications.
A little bit of background: In September, the FDA banned triclosan and 17 other chemicals used in hand and body washes marketed as "antibacterial." Why? Research has linked the ingredient to issues ranging from liver damage to hormone disruption and allergies, while other studies have shown that using soaps with triclosan were no more effective at preventing illness than using regular soap and water.
While triclosan has been off-limits for naturally minded brands and retailers for years, this ruling will inspire more large companies to invest in the science supporting natural antibacterial alternatives. For years, the greatest innovations in these areas have come from Seventh Generation and CleanWell, which uses thyme for its antibacterial properites. However, we can expect to see more in 2017. Natural companies will still have an advantage, as even some triclosan alternatives are still potent and potentially dangerous chemicals.
Triclosan is the exception, not the rule, when it comes to government action in the personal care space. While different pieces of safe cosmetics legislation have been seriously introduced since 2013, we have seen little to no progress, leading experts who follow the space to conclude that for now—and for the foreseeable future—the only way for the industry to clean up its act is by industry action.
The least regulated category (looking at personal care, supplements and food), there are essentially no restrictions on personal care ingredients, no checks and balances to ensure quality production and no ability of the government to act if a product is found to be unsafe. This means that large conventional brands can use a range of potentially dangerous chemicals; it also means that extremely small companies could be formulating in a dirty bathtub in a basement.
While all of this may sound discouraging, what it has led to is consumer advocacy that has prompted companies to reform; and also organizations and trade associations that unite companies committed to safe cosmetics, such as the Campaign for Safe Cosmetics. Companies are choosing to become certified—USDA Organic, B Corp, Fair Trade, NSF "contains organic," Biodyanamic—in order to prove their commitment to quality. And, above all, responsible companies are committed to full transparency of ingredients, trade secrets, manufacturing processes, sourcing partners and more.
With strong ties to health, beauty and the DIY artisan beauty movement, essential oils and aromatherapy will continue to grow. This year, brands become more experimental with blends and deliveries. And essential oils aren’t just booming in direct-to-consumer—more retailers are finding success with essential oils and aromatherapy products thanks to the consumer trend toward plant-based foods and heightened interest in artisan beauty products. The demand for natural or holistic alternatives across all facets of life makes essential oils’ versatility in food and beverage, supplements, household products, and personal care another major contributor to growth. More companies are entering the space or expanding their offerings, and as consumers become more attuned to the environmental and social impact of their products, smaller brands can more readily ensure that ingredients are sourced responsibly and delivery on a promise of product quality and ingredient integrity.
I’ve long been predicting the opportunity for companies to launch topicals that pair with complementary beauty supplements. And while we’ve yet to see many brands tapping into the health-beauty connection in this direct way, we are starting to see supplements and beauty companies partnering on in-store promotions and marketing efforts to connect the dots. One recent example is NeoCell and MyChelle, who worked together to position their vitality-focused products together in the aisles of Sprouts.
Of course, we still see the opportunity for the inside out and outside in approach to beauty. And the increasing awareness about the role of the microbiome and healthy bacteria in skin health, could be a strong gateway (i.e. what Ganeden has done). Companies that formulate with ingredients that are effective both topically and when ingested also have some big opportunities: think resveratrol, collagen, CoQ10 and more.
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