ASEAN market for organic cosmetics set to boom

The market for organic cosmetics in the ASEAN region is set to register a CAGR of 9.5% to reach an estimated value of $4.41 billion by 2020, according to the report “ASEAN Organic Cosmetics Market Analysis and Opportunity Assessment 2014 – 2020”, by Future Market Insights.

The adoption of natural and organic cosmetics has been slower in Asia than in other global regions because of culture, the level of economic development in certain markets, and the fact that in many areas natural personal care products are already a part of a long standing tradition that many modern consumers regard as old fashioned.

To put the size of the ASEAN organic cosmetics market into perspective, the value of the global market for organic cosmetics is predicted to reach $66.1 billion by 2020 on the back of a CAGR of 10.4%.

ASEAN economic growth fuels consumer spend​

In the ASEAN countries – which number 11 – economic development has been forging ahead at breakneck speed, particularly in markets such as Philippines and Indonesia, where economic growth is driving a burgeoning middle class with greater spending power.

The ASEAN cosmetics industry itself is growing on the back of this, with a cross-border  supply of labour and capital and increased organic components harvesting all serving to boost both suppliers and manufacturers operating out of the region.

The report is split into coverage of six main categories, which includes skin care, hair care, make-up, fragrances, toiletries and ‘others’, but it is in the largest category of skin care where significant growth is expected to top off at a CAGR of 9.7% during the forecast period.

Distribution channels set for growth and evolution​

With respect to distribution channels, the report says that it will be the beauty specialist salons channel that is expected to continue its dominance of the market in the region, accounting for approximately 23% of total revenues spent on products by 2020.

However, it will be the franchise outlets that will see the biggest growth in the distribution area, with the report highlighting CAGER of 10.3% over the next five years.

Likewise, an influx of new players in the department store channel is likely to see some significant growth in revenues, with this channel predicted to command 18.7% of the total market sales by 2020.