The organic cosmetics market - Belgium

1.2 A growing global market

The world's main markets :

Europe and the United States dominate the world market, followed by China and Japan.

Comparison of cosmetics sales in the world's main markets World, ****, € billion Source: ****

Organic and natural cosmetics on the rise:

Globally, consumer preferences for natural products are evident (***). Rising disposable incomes, coupled with improved living standards, are also driving the adoption of organic personal care and cosmetics products. Specifically, for organic personal care and beauty products, between **** and ****, there was an increase, of around *%, in natural product label claims.[***]

1.3 The Belgian cosmetics market

Retail sales of cosmetics reached €* billion in **** for Belgium and Luxembourg, making it the *th largest European market by value.

However, the value of sales fell by *.*% between **** and ****.

Belgian consumption of cosmetics and personal care products by value Belgium, ****-****, € billion (***) Source: ****

for information, sales of natural and organic cosmetics in Europe are estimated by Premium Beauty News at €*.** billion in ****. The market is expected to grow at a rate of *.*% through to ****.

By comparison, Cosmeticaitalia estimates cosmetics sales in Europe at €**.* billion in ****, so we can estimate organic's European market share at around *. *%.

Thus, assuming a similar share in Belgium, Belgian sales of natural and organic cosmetics are estimated at around €** million in **** (***).

1.4 State of Belgian foreign trade in the sector

First, we look at Belgium's foreign trade in organic chemicals, used in the composition of organic cosmetics (***) is ***%, underlining the competitiveness of the Belgian chemical industry. Indeed, the port of Antwerp is one of the world's leading hubs in the chemical industry, and its organic component is well mastered by the Belgian sector.

Foreign trade in organic chemicals Belgium, ****-****, € billion Source: ****

With regard to foreign trade in essential oils and resinoids, perfumery or toiletry preparations and cosmetic preparations, the Belgian coverage rate is around **%. This underlines the fact that Belgium imports more cosmetics than it exports in value.

Foreign trade in essential oils and resinoids, perfume and toiletry preparations and cosmetic preparations Belgium, **** - ****, € billion Source: ****

1.5 The impact of the Covid-19 crisis

Soap, perfume and cleaning product manufacturers were particularly affected in the second quarter, which corresponds to the period of strict containment in Belgium. After that, production picked up again to a level similar to ****.

We can therefore conclude that the sector has weathered the Coronavirus crisis rather well.

Comparative activity of soap, household products and perfume manufacturers between **** and **** Belgium, ****-****, € million Source: ****

however, not all cosmetics categories suffered in the same way: hygiene-related products were undoubtedly boosted by the health crisis, unlike beauty-related products (***).

According to CCI France Belgique, the "natural" cosmetics market was particularly dynamic in Wallonia in the *st half of ****, with growth of almost **%.

2.1 The main cosmetics products sold in Belgium

The cosmetics sector as analyzed in this study comprises * main categories, with different market shares on the Belgian market

Facial and body care dominate, with **% of sales by value Perfumes are the *nd segment, with **% of sales by value With **% of sales in value, personal cleansing follows Make-up is the *th segment in value with **% market share With **% of sales, hair care is the last segment

The importance that households attach to their appearance and well-beingis an important factor in sustaining demand in a society increasingly concerned with its image and body.

Belgian consumption by cosmetics category Belgium, ****, in % (***) Source: ****

2.2 Profile of organic cosmetics consumers

Average basket:

According to the Cosmetics Europe association, a Belgian consumer spent around €*** on cosmetics in ****, a basket well above the European average of around €*** .

According to Business France, in ****, the average Belgian consumer spent €*** on cosmetics, underlining that this average annual basket is growing.

* consumer profiles:

A study carried out by the GFK group identified three consumer categories that attest to the different reasons for buying an organic product. [***]

Health-conscious (***)

Purchase is motivated by a general healthy lifestyle choice

Concerned about the environment (***)

Purchase motivated by an understanding of the negative impact of unnatural cosmetics on the individual and the environment

Aware of the risks (***)

Purchase is motivated by a negative perception of chemical or processed products, which can cause damage or allergies

CCI France Belgique distinguishes * types of "responsible" consumers, bearing in mind that a consumer may fall into one of the following categories:

those who consume products for their own well-being those who consume out of concern for the environment

Gender and age profile:

Traditionally, women consume more cosmetics than men.

There is also a growing demand for anti-aging cosmetics such as anti-wrinkle creams, particularly among older women.

Nevertheless, the organic trend is very strong among millenials ...

2.3 Why buy organic cosmetics?

Several aspects explain the rise of organic cosmetics:[***]

Transparency about the ingredients used: consumers want to know what they are consuming, and are alert to the presence of harmful ingredients such as endocrine disruptors. The fear of consuming unhealthy products is therefore a primary explanatory factor, as natural products are perceived as being more respectful of the skin (***)

Increased attention to the environmental impact of products : the polluting components used in cosmetics, such as synthetics and petrochemicals, are increasingly criticized.

The "organic " trend is often associated with "natural", "responsible", "ecological" or "vegan" cosmetics .

Relaying these trends on social networks: Instagram in particular is a privileged means of communication for relaying these trends, which are increasingly taken into account by brands

More generally, consumption of organic products is booming, as the following graph shows. Even if it concerns mainly food products to date, the organic trend is an underlying trend that should spread to many products, particularly cosmetics.

Year-on-year percentage change in total spending on organic products Belgium, ****-****, in % (***) Source: ****

2.4 What are the obstacles to consuming organic cosmetics?

However, there may be obstacles - whether real or not - to buying organic products, such as :

lack of guarantees regarding product composition (***) blurred labels, with possible confusion between "natural" and "organic" products (***). price too high products sometimes considered less effective

One of the main arguments against buying organic cosmetics is price. Only **% of Belgians surveyed were prepared to pay more for organic cosmetics.

Willingness to pay more for cosmetics, hygiene or beauty products? Belgium, ****, in % of respondents Source: ****

Organic: a strong trend for food products, but still limited for cosmetics

As mentioned in *.*, organic products are booming in all categories, although food products are more popular with consumers.

*% of Belgians questioned in the survey below had consumed organic cosmetics in ****.

Which of these organic products have you bought in the last ** months? Belgium, ****, in Source: ****

2.5 Demand trends

Other demand trends that go hand in hand with "organic" include

local responsible" trade ecological and environmental aspects natural products vegan products free" products (***)

Consumers are increasingly buying their cosmetics online:

According to CCI France Belgique, the share of online spending on cosmetics has been rising for several years: in ****, it represented around **% of spending by value.

The average online purchase is €** , which is relatively high.

Share of online spending on cosmetics Belgium, ****, as % of spending by value Source: ****

In ****, a year marked by the Covid-** pandemic and the rise of e-commerce, **% of Belgians bought cosmetics online. While this share is lower than for other product categories, it underlines the fact that e-commerce is now a distribution channel favored by consumers.

By comparison, in ****, Belgium was one of the European countries with the lowest share of cosmetics sold online, with only **% of shoppers having purchased such products online, according to Cosmeticseurope.

Which of these products did you buy online in ****? Belgium, ****, in % of respondents Source: ****

3.1 Industry structure

Source: ****

With a renowned chemical cluster in Antwerp, Belgium is competitive in the cosmetics industry, with strengths in R&D and product testing. R&D is a very important element in the cosmetics value chain (***)

3.2 Belgian cosmetics production (organic and non-organic)

Below are the pre-tax sales of soap, household and perfume manufacturers located in Belgium between **** and ****. It can be seen that while the market was in decline between **** and ****, it has grown at an average annual rate of *.*% since ****, reaching sales of €*.* billion in ****.

Sales of soap, household products and perfume manufacturers (***) Belgium, ****-****, € billion Source: ****

the organic cosmetics market is still a niche market, but is set to develop rapidly given changing consumer behavior.

We note that the number of companies registered in Statbel's "manufacture of soaps, cleaning products and perfumes" category is *** in ****, a high level compared to the average level of the previous decade.

For example, Copaiba is a Belgian laboratory specializing in the manufacture of natural skincare products, and follows organic specifications for some of its customers .

Number of companies manufacturing soaps, cleaning products and perfumes Belgium, ****-****, in number of companies and employees Source: ****

The number of associated employees fell sharply between **** and ****, then stagnated (***) since ****.

Number of employees in the manufacture of soaps, cleaning products and perfumes Belgium, **** - ****, in number of employees Source: ****

3.3 Segmentation and player dynamics

The organic cosmetics segment attracts both major cosmetics groups, which offer organic products or brands, and new players specializing in organic cosmetics.

Major groups present on the Belgian market:

Players can enter the organic segment by creating organic ranges for some of their brands, or by creating or acquiring brands specialized in the organic segment

L'Oréal Clarins LVMH Yves Rocher

Specialized European brands:

Lush is an English brand and distributor specializing in natural and organic cosmetics, present in Belgium with a few stores.

N.A.E (***). The products are Ecocert-certified, vegan and feature recyclable and recycled packaging. [***]

3.4 Analysis of distribution channels

Products are distributed to consumers through various channels:

Mass distribution (***):Carrefour, Delhaize, Colruyt, Aldi, Lidl and Jumbo are all present in Belgium.

Selective distribution (***): Some independent stores specialize in organic, natural and local trends.

Make Senz, for example, is an independent natural cosmetics store offering products handmade in Belgium (***). Biocam is also a Belgian natural cosmetics boutique selling Make Senz products.

Beauty salons and hairdressers:Wellness specialists can take many forms, such as spas (***), thalassotherapy institutes, thermal baths, aquatic fitness centers, hammams, saunas and massage parlors.

Pharmaceutical advice (***)

E-commerce as mentioned in section *.*, e-commerce has been on the rise in recent years, with many start-ups in the organic cosmetics market focusing on online sales, while the major groups are focusingmore on cross-channel sales.

Breakdown of beauty products and cosmetics revenues, by category Belgium, ****, in Source: ****

Complementing the previous analysis, we note that more than half (***), and drugsotre chains such as Kruidvat or DI.

**% are sold through selective distribution, which includes independents and multi-brand stores(***)

Leading pharmacies and perfumeries by number of stores :

Kruidvat was the leading brand in January ****, with *** stores. Consumers can buy beauty and skincare products, health and intimate hygiene products, as well as baby and children's products. ...

4.1 Composition of organic cosmetics

According to COSMOS - the international non-profit organization for the standardization of organic products - organic cosmetics contain five categories of ingredients:

Water Mineral ingredients Physically transformed agro-ingredients Chemically transformed agro-ingredients Other ingredients

An agro-ingredient is defined as "any substance of plant, animal or microbial origin derived from agriculture, aquaculture or harvesting". [***]

Each category of ingredients must meet specific requirements and follow different regulations. In addition, it is necessary to identify the percentage of organic ingredients in each category.

One of Cosmeticseurope's recommendations was to reduce the use of microplastics in cosmetics, which actually fell by **.*% between **** and ****.

Example of the criteria of a widespread label:

The Cosmébio label details the various characteristics required by its charter for a cosmetic product to qualify as organic.

This certification currently brings together *** members and *** brands.

Source: ****

4.2 Price analysis

Organic cosmetics generally tend to be sold at higher prices than non-organic cosmetics.

Reasons for this include

the more demanding production process the higher cost of organic vs. synthetic inputs

However, this can vary greatly depending on :

products brands place of purchase

trend in the consumer price index for cosmetics:

The consumer price index for hygiene items has seen a downward trend in prices between **** and ****, with a slight upturn in ****.

Consumer price index for personal hygiene articles and beauty products Belgium, **** - ****, base *** **** Source: ****

4.3 Supply trends

Organic and eco-friendly packaging:

Beyond the cosmetics themselves, packaging is also affected by the organic and ecological trend. Bulk packaging is also on the rise.

Virtual customer experience and promotion on social networks

The ability to virtually apply and test cosmetics online has been widely developed on the main websites of the major cosmetics groups.

The promotion of new products on social networks is also a strong trend, particularly through influencers. Advertisements posted on these platforms contain offers and discounts that help attract more customers to buy products, which should work in the market's favor. [***]

Blockchain and traceability systems

Traceability is the ability to share the history of a product, passing through all stages of the production chain, from the ingredients entering the production process to the end consumer. The supply chain for personal care products and cosmetics is extremely complex. The proposal for a traceability system based on blockchain technology is to enable participants in the supply chain to insert information into the traceability network.information into the network in an identified and openly verifiable way, generating additional confidence in the traceability process. What's more, in the case of organic cosmetics, this contributes to organic certification.

In this respect, blockchain ...

5.1 Regulations

Regulation (***), or the "minimum percentage of products of natural origin".

There is a great deal of confusion surrounding the definition and identification of "organic" cosmetics. A first step towards a better understanding of the product is to differentiate between the following categories:

natural cosmetics, which contain extracts of natural origin and/or ingredients of natural origin (***)[***] ; organic cosmetics, which contain raw natural ingredients (***) from organic farming; they must therefore have a valid certificate attesting to their organic nature. [***]

Globally, the distinction is tending to fade, whereas in mature markets such as Italy, Germany and France, it plays a dominant role.Therefore, to establish the authenticity of the product, it is necessary to read the label (***) and ensure that a certified institution has attested its compliance with the requirements.In Western European countries, certification plays an important role in countering the trend towardsgreenwashing.[***]

Some examples of recognized labels :

european Ecolabel

Applies to shower gels, soaps, shampoos, conditioners, shaving foams, etc. Verifies that the product respects the environment throughout its life cycle, and is at least as effective as a non-Ecolabel product. Examples of requests: no non-biodegradable products, no perfumes in children's products, no superfluous packaging.

Cosmébio :

Concerns shampoos, conditioners, shaving foams, ...

6.1 Segmentation

• Bee Nature
• BelleBulle
• Clarins Groupe
• Delbôve
• Evocure
• imwe
• JYB
• L’Oréal (Belgique Luxembourg)
• Thala
• Pranarôm (Inula Groupe)
• Groupe Rocher (Yves Rocher)