Product integrity and performance are driving natural and organic personal care sales.
By Carol Radice
Consumer interest in natural and organic skin, hair and bath products is on the rise. Sustaining that interest may require retailers to take a closer look at their assortments as an overabundance of products on shelf can leave consumers scratching their head, or worse, walking away from the aisle without making a purchase.
Industry observers are concerned that this over assortment may be stymieing future growth of the category. In order to simplify things retailers are turning toward distributors for help, sometimes asking them to make many of the key merchandising decisions.
Observers say this can often result in a set that is less than optimal. Additionally, in a category consisting of a wide range of companies, both unknown and well known, it can be easier for retailers to defer to familiar names rather than taking the time to learn what consumers are interested in.
Despite these challenges, the natural personal care category experienced double-digit growth in 2010, says Jeff Carducci, national sales director of derma e Natural Bodycare, based in Simi Valley, Calif. Carducci expects this growth trend to continue and says all indications point toward sustained double-digit growth for natural personal care through 2015.
“We anticipate that anti-aging and sun protection products will be the key drivers during this time period as well as a continued focus on innovation and sustainability programs,” says Carducci.
Company officials also say consumers continue to show interest in skin care products that include vitamin A. As such, derma e has expanded its assortment that contain vitamin A. “Given this trend, it was essential that we continue to introduce new products that highlight scientifically proven, effective natural ingredients that promote smooth, younger looking skin,” says Carducci.
Consumers are also looking for natural and/or organic products that perform or outperform conventional products. “Being good for you is only part of the story,” says Susan Griffin-Black, co-founder of EO Products, based in Corte Madera, Calif. “Consumer expectations are that these products work as well as mainstream products and provide a healthier alternative,” adding that consumers are looking for better-for-you options with key ingredients that have a real story. “Customers are also looking for transparency and authenticity so that they can trust the company that they are buying from.”
Some observers say that the USDA’s National Organic Program (NOP) decision that personal care products in which “organic” is included as part of the brand name must be certified to the USDA/NOP standard is a key reason why interest in organic personal care products is on the rise.
“This levels the playing field for all of us so that the term organic will have integrity and longevity,” says Griffin-Black. “In addition, the non-GMO [Genetically Modified Organism] issue is very much on our radar. Knowledge is power and people have a right to know what’s in their products so they can make informed choices.”
She notes that EO was the first personal care company to become Non-GMO certified. “Our customers are concerned with these issues as it applies to food and although there is a bit of a lag time with personal care, their awareness is catching up,” she adds.
Value driven, larger-sized products are also on consumers’ radar. Given that core organic customers heed the “reuse, reduce, recycle” mantra, Griffin-Black says it is time suppliers began addressing these concerns. EO company officials are working on innovative refill options for their best selling products for next spring.
“We currently provide larger sizes to our retailers for their bulk programs and are thinking about how to improve on the current bulk model to make it more compelling and accessible for consumers,” says Griffin-Black.
Some observers are not quite as optimistic about the category. Despite its growing popularity, they say organic personal care products could have a tough road to tow. Alida Stevens, founder and vice president of creative services for Smith & Vandiver, based in Watsonville, Calif., says the high cost and market shortages of organic raw materials, coupled with the complex task of trying to apply organic food standards to personal care could lead to organic bath, body and skin care products being given less space in favor of those that are simply natural.
With this in mind, Stevens says third-party certification is becoming important to consumers because it helps alleviate the confusion some brands are causing by creating their own standards.
“Certification gives both authenticity to the brand and retailers’ natural set,” says Stevens. “It also makes the purchasing process easier for the consumer. It’s important that retailers understand that consumers want certification [authenticity] and performance without a major price difference.”
Smith & Vandiver has certified its bath lines through the Natural Products Association and added value with dual-purpose products that save time. “You can multi-task basic functions like cleansing and moisturizing with aromatherapeutic benefits like reducing stress or easing sore muscles all with one product. Because we are the manufacturer and sell directly to our retailers without using distributors, our retails are a real value when you compare our products to other natural brands,” says Stevens.
Value can also come in the form of celebrity attention. For example Dr. Oz recently featured Sibu Beauty products on his show. Based in based in Midvale, Utah, Sibu Beauty makes a line of 10 premium personal care products containing sea buckthorn sold under the Sibu label. Sea buckthorn is considered by many to be a superfood and company officials say it is exclusively grown and harvested for Sibu in the Himalayan Mountains of Tibet. Studies have shown sea buckthorn addresses a variety of needs including improving skin tone and texture, healthy aging and digestive health.
Sibu officials add that an exclusive harvesting and manufacturing process produces more potent and hardy berries than typical sea buckthorn making it some of the most nutrient-dense sea buckthorn available today. All Sibu Beauty products are paraben-free and cruelty-free and contain no dairy, wheat, sodium, yeast or preservatives.
“From our innovative liquid supplement and soft gel supplement, to our facial soap and daytime facial cream, beautiful skin, hair and nails are nourished from both the outside in, and the inside out,” says Peter McMullin, Sibu’s president.
Top of the rocks
Originally established in a small town outside of Joshua Tree National Park, Joshua Tree Skin Care (JTree) healing salve immediately gained a loyal following among the rock climbing community. JTree offers a collection of organic lip balms, healing salves and face sticks designed for those who lead an active outdoor lifestyle.
The JTree brand, launched with JTree, has since grown to include lip balm and sunscreen products, including Desert Shimmers, a collection of tinted lip balms and Winter Stick with SPF 15, its first sunscreen product developed for faces. Due to the popularity of the freeze-resistant Winter Stick, JTree added Sun Stick with SPF 33 to its product line. David Lawrence, president and CEO of the Pinckney, Mich.-based company, says their hands-free stick has been a hit with outdoor and active people on the go.
The products include organic certified herbal ingredients such as calendula, comfrey, Echinacea, tea tree oil and benzoin gum. Lawrence says the products efficacy also lies with how it is made. The herbs they use are ground weekly and roasted for two weeks. “It is a slow, painstaking process but it results in a very potent product,” he says.
Retailers offering a large assortment of natural personal care products might demonstrate commitment to the category, but as observers point out, there is a fine line between offering a breadth of assortment and leaving consumers bleary-eyed from too many choices at the shelf. “From what I have seen, most retailers tend to be over assorted in this category and when that happens retailers are more likely to lose sales, than gain them,” says Griffin-Black.
She feels it would be less confusing for the customer if retailers focused on creating a stronger representation of fewer brands, making the category clearer for shoppers. She adds shelf-talkers and signage are helpful, as is a well-trained staff. “Retailers should get as much support from their supplier partners on product points of differentiation, sampling, coupons, etc. They should also plan aggressive line drives and promotions on shelf so that the launch of the brand is successful from the beginning,” she says.
Recognizing that there are limitations to educate consumers at the store level, companies such as EO rely on the Internet to help them provide in depth information and education about key issues, ingredients and the marketplace in general. “Because we manufacture all of our products, we are interested in talking to consumers about our methods of sourcing, differentiating our formulation process from other companies through standards and ingredients,” says Griffin-Black.
Content on the company’s website also addresses what they do not do and the choices that they faced when making their products. “EO stands for essential oils and we only use essential oils for the fragrant and therapeutic contribution to each product—so no artificial colors or fragrances ever. Our goal is to provide education and information so that people can choose wisely,” she says.
Given the typical space constraints on shelf, observers say it makes sense to focus assortments on the segments of personal care most widely sought after by mainstream consumers. For example, natural bath is more widely accepted than natural hair or skin care as performance is closer to expectations.
“The consumer is still getting used to the concept that shampoos don’t need rich creamy foam to work well and want the performance synthetic ingredients offer in styling aids and beauty products,” says Stevens.
Despite performing the same if not better than conventional products, Stevens says natural skin care and beauty products are growing slowly, as performance is still most important when choosing a product. As a result, consumers are trading off, sometimes using natural and sometimes using conventional personal care products.
“We hear consumers rationalizing their choices, ‘I’m not going to give up my mascara, so I’ll eat more organic fruits,’ or ‘I only use a little face serum so I’ll stick with my brand, but choose a natural body lotion because I use so much more,’” says Stevens.
To help consumers make more informed choices and minimize the temptation to trade off, Smith & Vandiver has recently beefed up packaging content on its Aromatherapaes line to include more information about ingredients, function and benefits. “As today’s consumer is purchasing less, we feel she wants to make more informed decisions,” says Stevens.
Likewise, Sibu Beauty gets the word out about their products and builds demand through aggressive advertising, product demos, POS materials and store circulars.