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Natural beauty has evolved immensely in recent years, and is now no longer just the domain of niche players, as clear by the many high-profile brand launches—such as L’Oréal’s Garnier Fructis Pure Clean, Beiersdorf's Nivea Pure and Natural, and Unilever’s Timotei Organic Delight—in the past few years.
In terms of distribution as well, natural beauty brands have also gone more mainstream, and are now stocked in a variety of retailers such as Walmart and Target, as well as in department stores around the globe. Many natural beauty brands also have launched their own stand-alone stores, with Melvita opening locations in the U.K. and Lavera sites opening in the U.S.
Direct sellers such as Mary Kay and Oriflame have also jumped on the natural bandwagon, with Mary Kay Botanical Effects and Ecobeauty, respectively, both hitting shelves in 2011. However, despite increasing demand for natural beauty in fast-developing countries like China, India and Russia, there are many challenges for such products—above and beyond the inherent challenges for non-niche international natural brands looking to enter these markets.
Among the first challenges, there is the issue of how one defines and perceives “natural.” While the COSMOS standard has been established in Europe since mid-2010—with by five certification organizations (Ecocert, the Soil Organization, ICEA, Cosmebio and BDIH) involved in its development—and the U.S. Food and Drug Administration offers its USDA Organic certification to beauty products, as well as the various other natural/organic certifications available, many beauty brands are still questioning whether these criteria are defining enough, and consumers are still not very familiar with the labels.
(For more on the natural beauty marketplace and various natural and organic beauty certifications, see “Illuminating Natural Beauty,” “Organic Beauty: Hip ... or Just for Hippies?” and “The Process of Going Organic.”)
While natural beauty has been in increasing demand in fast-developing markets—in countries like Russia, for example—consumers are not very aware of the various labels, as well as what the differences between the labels are, and are also not that deeply concerned about the proportion of natural or organic materials in their products. Furthermore, in Russia, India and China, local organic and natural brands are normally preferred, with many consumers not trusting foreign brands’ natural or organic claims, which in turn have given rise to stronger popularity and sales of domestic natural brands in their particular countries or regions.
In China, for instance, where consumers have always been concerned with chemicals in their daily-use products, domestic natural beauty players dominate, and are now expanding internationally using the country’s roots in herbal medicine to promote their offerings. For example, Shanghai Jahwa United’s Herborist is being sold in Sephora stores around the world, notably in France and Italy.
Thus, international brands not only have to compete with domestic brands in emerging markets but with such brands in their home markets too. With many beauty trends inspired by the East lately, Asian brands are having a wider impact and penetrating Western markets more easily now, with natural beauty brands looking to be no exception.
Pricing strategy is one area of opportunity for international beauty brands. Natural and organic domestic beauty brands in countries such as India have been pricing their products up to 10 times higher than standard offerings. An example is Forest Essentials in India, which is only focused on natural products but charges a high premium for them.