Gaining Consumer Confidence by Finding Common Ground

  • There is a growing interest in exotic natural ingredients that can be easily tied to current trends in other industries.
  • While there is a place in the market for ultra natural brands that avoid surfactants, emulsifiers and preservatives, there simply are not enough consumers willing to do without traditional beauty products.
  • Ethical responsibility and sustainability will remain at the forefront with natural-positioned products.

The natural product segment has an incredible opportunity to seize a sizable share of the beauty industry. According to Sundale Research, natural- and organic-positioned products are expected to account for 17.4% of the beauty industry by 2013, up from the 5.1% expected in 2010. Consumers are seeking natural, organic and green products. However, a frightening trend is being caused by the natural segment itself. Constant bickering among the chief natural companies, certifiers and resources are causing consumers to doubt the reliability of natural products.

According to market research company Mintel, “In the U.S., some 42% of consumers indicate they don’t know what to believe as to whether natural and organic personal care products actually are natural or organic.” The debate over who really is natural within the industry, with one organization bad-mouthing another, is creating the opposite effect on naturals segments than desired.

No wonder consumers are confused. The dizzying pace at which one organization declares itself the authority on natural and organic while another undercuts them to reach the top even makes natural cosmetic formulators’ heads spin. The debate inside the industry was originally fueled by legitimate concerns regarding the authenticity of some brands’ natural or organic claims; however, the backlash of lawsuits and outright brand-to-brand attacks has left the consumers with a lack of confidence in the natural industry.

The proliferation of new “standards” and lists has made formulating an “approved list” a driven exercise, rather than one based on effectiveness, proven safety and consumer cost of the finished product. In the case of many safe ingredients, the baby has been thrown out with the bath water, with misleading information from watch groups. This trend has the potential to erode consumer confidence even further in the natural industry, and in order to gain that confidence back, common ground within the natural segment must be found.

Natural Ingredients with Historical Evidence

Old is new again. Rely on ingredients with long-term historical use in cosmetics. Back to basics will not only create effective natural skin care products, but also buoy consumer confidence. Brands can’t go wrong with ingredients such as shea butter, olive oil, green tea, rooibos and essential oils. According to Mintel, “Because consumer confidence worldwide this year has taken a hit, 2010 will see increased consumer demand for proof or results.” Natural ingredients have centuries of results, and consumers can feel the difference immediately. The undeniable effect of shea butter on dry skin speaks for itself and natural-positioned products.

New Trends in Natural Ingredients

Whenever possible, keep it simple. Beyond just looking for results, consumers are seeking products that use ingredients which have naturally occurring vitamins, minerals and antioxidant properties. Rooibos extract is the perfect example of an ingredient that carries with it a natural apothecary for the skin. Consumers are sold on the value of superoxide dismutase, but place a higher value on the natural source found in rooibos extract.

There is also a growing interest in exotic natural ingredients that can be easily tied to current trends in other industries. Ingredients such as broccoli seed oil, pomegranate extract, coffee butter, usnea extract and carrot seed oil are catching consumer’s attention due to the crossover of information from the food, herbal and aromatherapy industries.

A Place for Natural, Naturally Derived and Synthetic

Here is the rub in the natural segment—you simply cannot make every beauty product out of ingredients picked directly from the earth. The most heated debates in the industry are centered on surfactants, emulsifiers and preservatives. While there is a place in the market for the ultra natural brands that avoid all three categories, there simply are not enough consumers willing to do without traditional beauty products. There is a large base of consumers who desire natural products, but not at the price of beauty. This is where the fluency of common sense must prevail in naturals. Many already agree that ingredients such as cetearyl alcohol, cetyl alcohol, decyl glucoside, phenoxyethanol, and even on some lists, sodium lauryl sulfate have a place in the natural industry. The vital function of ingredients that act as surfactants, emulsifiers and preservatives simply cannot be achieved using natural substances in all cases.

Raw material suppliers can play a vital role in bringing a long list of acceptable ingredients to organizations such as NaTrue and The Natural Products Association by submitting their ingredients to their certification process. Many suppliers have already had their naturally derived and synthetic ingredients certified by these organizations, which can only aid cosmetic chemists in creating and marketers positioning products that consumers are confident in.

The Impact of Fluctuating Standards and One-up-man-ship

Consumers are confused, and many brand owners are formulating based on a variety of lists, standards and variations of misinformation on the Internet. Mintel Beauty Innovation predicted a new consumer standard it coined as “Nu Natural.” According to Mintel, “it is a new vision of natural that is less focused on certification and more focused on results, efficiency and safety. In 2010, beauty products will evolve from today’s trend toward organic ingredients, revisiting attributes like authenticity, provenance and local production, and expects claims such as ‘free from’ and ‘sustainable’ to appear in products that simultaneously contain synthetic actives like peptides, hyaluronic acid, ceramides or collagen.” Mintel’s Nu Natural encompasses the values that are driving consumer spending, and keeps the decision-making simple for consumers.

Using Technology to Build Credibility and Value

The good news is that consumers are readily available for direct one-on-one contact with brands. The story of your product creates value, credibility and furthers consumers hunger for education regarding natural, safe, green and organic beauty products.

According to Mintel, in 2010, “Consumers will not just buy discount brands, they will scrutinize products more, and buy those that they perceive as being good ‘value.’ There are a growing number of online tools to help people pay attention to virtually everything, ensuring transparency—everything is out in the open in the Internet age and secrecy is no longer acceptable for today’s consumers.”

According to recent Sundale Research information, the natural industry will grow by 14.6% in 2010. Mintel says, “One-third of all consumers have never tried organic or natural personal care products, suggesting that there is plenty of room for growth in this market.” Research by Sundale has shown that consumers are willing to pay 20% more for safe, effective “green” beauty products. Even in this economy, Mintel research says, “Consumers will look for ways to escape from the tyranny of value, cutting back and saving such as splurging or lashing out on a big purchase—consumption has never been solely rational … and it never will be.”

Brands, big and small, that do not undercut another brand to sell themselves will find consumer loyalty; word-of-mouth advertising and opportunities abound in the virtual marketplace of social media. Like never before, a brand’s ability to speak to consumers honestly and forthright will supersede those that maintain a one-way communication with the consumer.

Ethical Responsibility; Sustainability Trump Price in Naturals

Trends in natural products will come and go, but ethical responsibility and sustainability will always remain at the forefront with natural-positioned products. According to Mintel’s latest report on green living, “The environment remains a concern for the majority of Americans. More than one-third (35%) of survey respondents say they would pay more for ‘environmentally friendly’ products.”

At the core of consumers who lean to natural is a desire to protect the Earth, use nontoxic products and support companies with ethical business practices. Chasing ingredient trends will lead nowhere if the core of the corporation isn’t in alignment with the cornerstone of these interests in natural.

Kayla Fioravanti is the vice president, chief formulator, and ARC-registered and certified aromatherapist for Essential Wholesale and its lab division Essential Labs. In 1998, Fioravanti started creating products in her kitchen using essential oils. Essential Wholesale grew out of a $50 investment in raw supplies, which has become a multimillion dollar company housed in a 30,000-square foot certified organic facility. She was a recent finalist for ICMAD’s “Innovation of the Year,” and Essential Wholesale has been recognized by the INC 5000 as one of the fastest-growing companies in America for three years in a row.

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