When Horst Rechelbacher founded the Aveda Corporation in 1978 to produce botanically based salon hair care products, he couldn’t have fathomed selling his company 19 years later to The Estée Lauder Companies for $300 million. However, the acquisition allowed him to pursue a new entrepreneurial path—founding Intelligent Nutrients, a company utilizing 100% food-based, organically certified ingredients. Launching 24 SKUs, that include an antioxidant-infused chocolate bar, a whole foods bar, and liquid and tablet-sized dietary supplements, in June 2008 to North American medical spas, salons and boutique retailers, Intelligent Nutrients is just one of hundreds of companies around the globe expanding from topical beauty care into the nutricosmetics market.
Points of Entry
Organic food bars and supplements aren’t the only points of entry into nutricosmetics. Like its French competitor, Danone Essensis—the vitamin-fortified skin care yogurt—Russia’s Wimm-Bill-Dann Foods launched the first probiotic drink and functional yogurt of its region in 2007. The Neo Beauty line—formulated with aloe vera, antioxidants, minerals and vitamins—claims to improve the overall health of skin, nails and hair. “By the end of this year, we hope to have 100 million sales,” says Marina Kagan, head of public affairs, Wimm-Bill-Dann.
Similarly, in 2007, Nestlé Hong Kong introduced Day & Night collagen yogurt drinks to improve skin moisturization and elasticity. Firmer skin and other popular marketing claims have elevated collagen as one main ingredient in many nutricosmetics products, especially in Asian beverages. Japan’s Nippon Milk Community’s Kirapuru Lactic Acid Bacteria Drink claims to firm skin with 1,000 mg of collagen per pack, as does Toki, a lemon-flavored powdered collagen supplement introduced to the U.S. by way of Japan in 2002.
“In Japan, oral cosmeceuticals such as collagen, hyaluronic acid and ceramide are the most popular ingredients for this category,” says Yoichiro Sugimura, senior director of scientific affairs and business development, Kyowa Hakko USA. “Historically, many herbs have been thought of and used for optimal health. In Japan, there is a saying that ‘food is the best medicine,’ so people are willing to think that certain foods are good for health, including skin health.”
Another way consumers ingest collagen is to eat it. Eiwa Confectionary’s marshmallows are enriched with collagen to reduce the signs of aging. Hot and Sour Wonton Vermicelli, from Singapore’s Myojo Foods Company, features collagen and vitamin C. In South Korea, Goliath’s Orion Corp. sells Mi in Gumi Collagen Jelly, and similarly, Japan’s Asahi Food & Healthcare Co., Ltd. offers Soaking Collagen Water Jelly.
However, for consumers interested in plant-based ingredients, superfruits such as mangosteen form the basis for Borba’s Skin Balance Anti-Aging Clarifying Water, and tea-based beverages, such as the antioxidant-rich Cornelia Skin Clarifying Drinking Tea that contains birch leaves and chamomile to address acne-prone skin. L’Oréal has even considered branching into nutricosmetics by forming a partnership with Coca-Cola to develop Lumaé, a line of tea-based drinks and nutritional supplements for skin care.
In the U.K., mass retailer Tesco sells Bio-Synergy’s Beauty from Within drinking water, containing aloe vera, green tea and vitamins A, D and E. And in France, Compagnie Fermière de Vichy’s Vichy Célestins brand of Complexe Anti-Age Water, launched in 2007, provides consumers with aloe extract, apple and grape polyphenols to fight free radicals.
So the question comes down not to which point of entry is easiest in nutricosmetics—food, beverages or supplements—but which is right for your brand and your consumers? Executives from ingredients supplier Cognis Nutrition & Health—Sigrid Krämer, research platform manager, and Albert Strube, director, global growth product lines—believe dairy products may be the most widely accepted nutricosmetics by consumers.
“A major advantage of drinkable skin care products is their high water content, which helps prevent the skin from dehydrating. It is, therefore, a logical step to combine liquid products with additional ingredients that have a caring effect on the skin,” say Krämer and Strube.
However, not all brands that have taken the plunge into functional beverages have succeeded. Nestlé Japan Ltd., which launched Café Au Lait Calorie Half with Collagen, announced its discontinuation in August 2008.
To avoid discontinuation due to poor sales, Rechelbacher of Intelligent Nutrients says he had to change the way he thinks about his company. “We’re no longer ‘cosmetic,’ ” he says, “but ‘food-grade.’ ” According to Intelligent Nutrients’ president Melissa Christenson, a third party audits and validates the organic certification for the brand’s finished products with the U.S. Department of Agriculture, and each ingredient supplier must also provide the company with organic certification. “It’s about complete traceability in all formulations of our products,” she says. “There is integrity behind our ingredients.”
For the Intelligent Nutrient’s Wunderbar, the Intercalm Infused Chocolate Bar, and Intellimune Oil and Tablets, Christenson says the seeds from organic vegetables and fruits are cold-pressed for their antioxidants. “We obtain their oils to protect cell membranes, and the seeds’ water-soluble ‘flour’ to protect inner cells,” she says.
Aligning the antioxidant properties of multiple seeds—for instance, blueberry, raspberry and grape—in a complex, garners a higher level of activity in ingestible or topical products, according to Rechelbacher.
Another main ingredient Rechelbacher relies on is cumin. “When I studied ayurvedic medicine in India, I was astounded by how many people use cumin,” he says. “It’s improved activity in our products.”
Other foods are also rich with skin-beneficial ingredients—antioxidants, for example. And looking across regions and cultures reveals many benefits.
“Tomatoes are a big part of the Mediterranean diet, containing high levels of lycopene and beta carotene,” says David Djerassi, cosmetic and nutricosmetic business development consultant for ingredients supplier LycoRed Corp. “We capitalize on that with our Lyc-O-Mato ingredient, which contains carotenoids. If you have a 90–100 mg capsule of Lyc-O-Mato every day, it’s the equivalent of ingesting the actives in five tomatoes.”
Lakshmi Prakash, vice president of innovation and business development for ingredients supplier Sabinsa Corporation, points out several additional ingredients she believes should be high on the list for nutricosmetics manufacturers. “The oral intake of antioxidants such as proanthocyanidins (found in grape seed extract, apples and other plant sources) and vitamin E is reported to reduce the risk of DNA damage by UV radiation,” Prakash says. “Similarly, orally administered soy isoflavones and green tea polyphenols offer protection against photo-aging through inhibiting the action of enzymes that degrade connective tissues.”
Cognis’ R&D centers also create formulations with vitamin E, plant extracts, carotenoids and omega-3 fish oils, to name a few ingredients, for use in nutricosmetics. More than 50% of its oils and plant extracts come from renewable resources.
Similarly, DSM Nutritional Products works with science-based platforms, formulating vitamins, antioxidants, carotenoids and polyphenols for use in beauty beverages that claim to protect skin against UV rays and dryness.
Kyowa Hakko USA, with production facilities in the U.S. and Japan, starts with a base of glucose and produces its amino acids and related ingredients by fermentation. The company claims its lumistor hydroxyproline stimulates skin collagen synthesis.
There are raw ingredients that pose challenges in formulating nutricosmetics and that can negatively affect finished products, so suppliers work diligently during the R&D process to stabilize nutrients for use in foods, beverages, dairy products and dietary supplements.
DSM, for example, offers water-soluble, fat-soluble and beadlet forms of antioxidants and vitamins, allowing for their direct compression. And to ensure consistent ingredient supply and quality, the Sabinsa Corporation utilizes a food applications lab to prepare and test botanical and nutritional ingredients for stability, acceptability and optimal formulation. “These efforts are particularly important, since color, taste or texture characteristics can often render a healthy and natural ingredient unattractive,” says Prakash.
A product’s sensory effect often directs consumer usage, so in order to overcome unappealing odors evident in raw ingredients such as fish oil, some suppliers produce omega-3 solutions that have no fishy taste or odor and no reflux after intake. “If it tastes good and is a natural part of their diet, many consumers regard functional foods as an interesting alternative,” say Cognis’ Krämer and Strube.
However, the same ingredients when used topically for skin care rather than ingested can have different esthetic properties. For instance, according to Djerassi, rosemary extracts have an odor when used topically, but when ingested in a supplemental form, it’s not an issue.
What is an issue, once taste and odor have been addressed, is an ingredient’s dosage. Lori Lathrop Stern, scientific leader, DSM Global Nutrition Science, says recent studies demonstrate how combining multiple ingredients at smaller dosage levels can achieve a similar benefit as a single ingredient. Then, a dose can also be split among multiple servings per day.
R&D challenges aside, the next step in producing nutricosmetics is marketing a product’s ingredients to consumers.
DSM performs concept testing and other market research on consumer interest areas. “Our goal is to offer skin care formulations with a unique value proposition that resonate with consumers and that are applicable in beverages, dairy products and foods, as well as in supplements,” says Caroline Brons, senior marketing manager, DSM Functional Foods.
For manufacturers marketing health claims with their products, regulatory issues can cause concern. Teaming up with a supplier that offers R&D, technical, applications and regulatory support is a worthwhile option. Using suppliers who already have documented scientific results for their ingredients removes much of the burden involved with regulatory compliance, according to Krämer and Strube—though, it must be noted, that the company on the label (the brand) bears responsibility for compliance under most regulatory/legislative guidelines.
Evaluating the potential of ingredients from a scientific standpoint and consumers’ interest, Kyowa Hakko’s Sugimura says antiaging claims for baby boomers and natural claims are key trends. “By leveraging the current natural trend, we came up with the concept of combining oral and topical for lumistor hydroxyproline—‘beauty on the inside’ and ‘beauty on the outside,’ ” he says. “Many consumers prefer to use natural products with biologically active components that offer clinically proven health and safety benefits,” add Krämer and Strube. “In a Datamonitor survey, 51% of consumers agreed with the statement that skin care products based on natural ingredients are healthier and better.”
Euromonitor International, too, notes the correlation between nutricosmetics and naturals in the minds of consumers.
So just how popular is the nutricosmetics global market?
LycoRed’s Djerassi believes nutricosmetics is the “new frontier” for the cosmetic industry. Functional foods, he says, are expanding in Asia. Euromonitor notes that Japan is the leading nutricosmetic products market and that the Asia-Pacific region as a whole is an important market for these products. Mintel’s market researchers report that new product development, driven by consumer demand, is most prevalent in China and Japan.
“Being a Japanese company, our sales in Japan are the largest. However, the U.S. market is the fastest-growing business for nutricosmetics for Kyowa Hakko,” suggests Sugimura. “As baby boomers age in North America, they are looking for additional ways to stay young on the inside, as well as look young on the outside.”
According to DSM’s Stern, the U.S. nutricosmetics market has been slow to grow due to a lack of efficient packaging. “Combining both a topical and an oral skin care routine as part of a daily beauty regimen is gaining popularity,” says Stern. “Also, scientific studies show that there are synergies to be gained from a combined oral and topical beauty program.”
Djerassi understands that synergy and believes it will make more sense to con- sumers when a topical skin cream product is combined in the same package as dietary supplements. For instance, Beiersdorf AG’s Nivea already combines tablets and a tube of skin care cream in one package in its Nivea Smoothing Cellulite Gel-Cream & Dietary Supplement Capsules.
This leaves the U.S. as a fertile breeding ground for nutricosmetics brand expansion. Susan Babinsky, senior vice president and head of Kline & Co.’s consumer products consulting practice, explains. “With a huge untapped market in the U.S., the nutricosmetics industry offers a number of opportunities for companies looking to break into this market,” she says. LycoRed is one such company, according to Djerassi, having entered into the U.S. during the past three years from a primary market hold in Asia and Europe.
According to Sabinsa’s Prakash, “interest in these products in the U.S. is increasing as manufacturers introduce more functional food products such as cereals, bread, pasta, beverages, meal replacements, yogurt, candies and other forms that can be conveniently consumed and fit readily into daily eating/snacking patterns.”
The Natural Marketing Institute (NMI) announced that between 2006 and 2007 in the U.S. alone, functional/fortified food and beverage consumer sales increased 12% to $38.6 billion. The category comprises the largest segment within the health and wellness category, according to Maryellen Molyneaux, president of NMI. “It represents more than one-third of all industry sales,” she says. And of this group, NMI reports consumer food and beverage sales for organic brands similar to Intelligent Nutrients increased by 25% in the U.S., with sales of $19 billion. Global Industry Analysts’ 2007 report on functional foods estimates that, when combined, the U.S., Japan and Europe (led by sales in the U.K., France and Germany) consume 90% of the world’s functional foods and beverages. The researchers report that functional beverages—specifically in the dairy category—have staked the biggest claim in the market, with total sales expected to hit $34 billion by 2010.
On the global front, Krämer and Strube say the combination of oral and topical products will gain importance in this market: “Consumers will detect this as a new opportunity to have an even more effective beauty.” Expanding into the U.S., specifically, with a fortified dairy beverage or a dual skin care cream and supplement regimen remains an opportune start.