Muslim spend on cosmetics increased 6.8% in 2021 to $70 billion and is expected reach $93 billion in 2025.
Halal cosmetic sales have grown in East Asia at a faster pace than any other market, driven by Indonesian brands across the board as both small independent start-ups and the established players expand their footprint.
Such growth during the difficult operating environment the COVID-19 pandemic presented reflects the burgeoning potential for halal cosmetics. This is evident in Muslim-majority and non-majority countries as awareness around halal grows – that halal-certified cosmetics contain no haram (unlawful) ingredients and are increasingly cruelty-free and vegan.
The DinarStandard’s State of the Global Islamic Economy Report 2022 estimates Muslim spend on cosmetics increased by 6.8% in 2021, from $65 billion to $70 billion, and is expected to grow by a further 7.2% in 2022 to $75 billion and reach $93 billion in 2025.
See - Infographic SGIE 2022: Halal cosmetics
“The halal cosmetics is the fastest growing sector among halal product sectors (food, pharmaceuticals and fashion) with 7.4% compound annual growth rate (CAGR) growth by 2025,” said Iman Ali, Research Analyst at DinarStandard.
“Consumers are increasingly demanding cruelty-free, organic, natural and vegan-certified cosmetics and realising halal certified products include these properties. This has been a key driver for brands to adopt more eco-friendly approaches and be racially inclusive in product offerings and marketing.”
India remained the largest Muslim cosmetics consumer market last year with a $6.27 billion Muslim spend or 9% of the global Muslim spend in the sector.
The Organisation of Islamic Cooperation (OIC) member countries imported around $13 billion in cosmetic products in 2020.
“Odoriferous substances and make-up or skin-care are the most imported cosmetic commodities by the OIC in value, covering almost 56% of the imports. Above-the-mask products (such as eye make-up and hair care) have gained more attention since the pandemic,” said Ali.
Major ingredient manufacturers are getting halal certification for their portfolios, while the growing demand for vegan cosmetics is to the advantage of the development of halal cosmetics. Hourglass Cosmetics and Unilever have created a vegan carmine-alternative for lipstick. Carmine is derived from insects and considered haram, as is porcine, another common ingredient used in lipsticks.
East Asia has cemented its position as the epicentre of halal cosmetics. South Korean cosmetics manufacturers and brands, riding the global popularity of K-beauty, have continued securing halal certification, primarily with an eye on exports to OIC countries; from East Asia to Central Asia, and the Middle East.
Japanese brands are also entering the halal cosmetics segment.
Indonesia’s 225 million-strong Muslim population is a key driver in halal cosmetic growth, propelled by its young populace and the country’s strategic move to develop an Islamic economy, putting in place obligatory halal certification requirements over the coming years.
Indonesian brands are expanding their portfolios and global footprint. There have also been moves to expand halal cosmetics ranges to include men with Indonesia’s Paragon, owner of the country’s largest halal brand Wardah, launching its Kahf line.
The Gulf Cooperation Council (GCC) countries have also witnessed significant expansion in the beauty market, in line with the region having the world’s highest per capita spending on cosmetics and fragrances. Halal cosmetics brands are being launched and newcomers are expanding through tie-ups with e-commerce platforms and retail outlets.
Regulations pertaining to cosmetics have tightened in many markets, while the industry itself is calling for stronger measures against cruelty to animals and the impact of cosmetics on the environment.
Ali said halal cosmetics brands are tapping into this trend, while also reflecting consumer demand for inclusivity and diversity in product offerings and marketing.
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