From sustainability to skinification and beyond, Julia Illera, Beauty and Fashion Consultant and Research Manager at comprehensive market research firm Euromonitor, looks at the major driving forces in hair industry consumer habits right now.
Rising costs and squeezed household budgets in 2022 resulted in Australians reconsidering their spending habits, with many trading down to more affordable options and being more selective with their expenditure, whilst still giving themselves permission to indulge. Overall demand for hair care remained higher than 2019 levels, supported by a continuation of trends in recent years, which saw consumers focus on health and nourishment of the hair, ingredients and sustainability.
Price sensitivity also gave brands an opportunity to enter the ‘masstige’ segment, offering premium ingredients, features and aesthetics at a lower cost to consumers. This also gave mass brands an opportunity to maintain volume sales while adopting more sustainable bulk-sized packaging. Overall, Australia’s hair care market was worth AUD 1.6 billion in retail value sales as of 2022.
The following are some of the key themes influencing this spend and the local industry.
The skinification trend in hair care, where consumers are increasingly in search of specific solutions to address various conditions and view scalp care as an extension of skin care, is expected to influence the further development in Australia’s haircare space.
This is further accentuated by greater consumer knowledge of ingredients and preference for natural formulations and native botanical ingredients, with a plethora of brands competing in this space. [EK1] Local hair care brands are leveraging their botanical, natural and eco-conscious credentials when releasing new products, in line with consumers’ preference and growing interest in ingredients that support hair health and nourishment.
Interest in products that support Australian’s sustainable purchasing choices continued to increase, with players investing in products that limit harmful ingredients and their impact on the environment. Larger and more established players are also shifting towards more sustainable packaging options, such as aluminium bottles that can be reused, recycled and refilled, along with a range of pouches, which claim to use less plastic.
Sustainability is predicted to continue to influence hair care’s development in Australia, with further development of sustainable ingredients and packaging expected in hair care. While significant progress has already been made by moving into products that limit the use of plastic packaging and water, there are still opportunities for innovation across hair care that offer better ingredients and products for the environment. Hair care players need to be more transparent and specific about the ingredients they use, their origins and the manufacturing processes to appeal to consumers.
There is still room to improve hair care packaging and innovation within hair care in terms of packaging, formulations and ingredients. The industry is anticipated to further address demands from eco-conscious consumers in the coming years.
According to Euromonitor, hair health is the top desired functional feature of hair care, with 25 per cent of Australians looking for this in 2022. Other health-adjacent features, including growth enhancing, sun protecting and scalp health, are seeing increased demand, while appearance-led functions, such as grey camouflaging or long-lasting scent are in decline. This is in line with an overall shift in desire within beauty to look healthy.
Euromonitor survey results indicate that the top two reasons for purchase in Australia in 2022, were ‘need to replace because my current product ran out’ at 25 per cent and ‘to improve the look or feel of my hair’, also at 25 per cent.
Sustainability, conscious products and a trend towards hair health seems to be the way of the future. Retail your products accordingly.
For more information visit www.euromonitor.com
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