The global market for organic cosmetics and personal care products is expected to see industry leading growth over the next five years, with North America carving out the largest slice of the pie.
The market for these products worldwide was estimated at $7.6bn in 2012, and is expected to rise to $13.2bn by 2018, giving a CAGR of 9.6 percent over the six year period, according to TMR.
According the market research, one of the biggest drivers of this growth across all consumers groups is the fact that they are reaching out for products that are deemed to be more natural, reflecting aspirations for better personal health and hygiene.
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Likewise, the researchers also point to the fact that widening distribution channels and new product development are other significant factors that are contributing to this market growth.
However the market remains a relatively small niche on the global scheme of things, and its further development is also being held back on account of a number of obstacles.
These challenges include limited shelf-life, raw material supply and strict regulatory requirements that are expected to be amongst the most significant hurdles to overcome in the period up to 2018.
On a category basis, it remains that skin care that is the most dominant product area, continuing to scoop a 32.1 percent share of the global organic personal care market in 2011, followed by the hair care category, which comes in at a close second, then color cosmetics.
Demand for skin care products is also expected to lead the way, with projected CAGR expected to be 9.9 percent in the period 2012 to 2018, while strong demand for all three segments is expected to be driven by the entry of large multinationals to this area, helping to increase visibility and accessibility.
North America recorded a 34.8 percent share of the global market in 2011, which is expected to see growth of 10.2 percent in the period 2012 to 2018.
Future growth looks bright in emerging markets
Although Europe is also a big market, faster economic growth is expected to make a bigger impact on market growth in the Asia Pacific region.
Here, the researchers predict that market growth will reach a CAGR of 9.7 in the period up 2018, supported by rising consumer incomes and changes in lifestyles. Japan and China remain the biggest markets, accounting for 64 percent of revenues in the region in 2011.
With respect to future growth in emerging markets, the researchers point to countries such as India, China, Brazil and Mexico as places that offer ‘huge market potential’, particularly for some of the fast growing global brands.