Name: The State of Conscious Beauty
Uploaded: 2025-05-28T18:16:09.815Z
Duration: 1 h 8 s
Description: The State of Conscious Beauty

Transcript for "The State of Conscious Beauty": Hi. I'm Josephine Mann, technical operations manager at Quality Assurance International, an NSF Company, an NSF company. I'm excited to be part of this session on conscious beauty and to share some new research from NSF. For those of you who may be unfamiliar with NSF, we are a leading global public health and safety organization that supports a number of verticals in the natural products industry, including Conscious Beauty. Earlier this year, we released new consumer data demonstrating the importance of health and sustainability in personal care purchasing habits. We commissioned TGM Research to survey 1,000 Americans in the fall of twenty twenty four. The survey sample was controlled for gender, age, and region. We also surveyed 1,000 Canadians, but this presentation will focus on The US research. Questions focused on personal care products such as skin care, cosmetics, soaps, and shampoos. The research demonstrates the growing demand for cleaner choices and third party certifications in this industry. The survey had an even distribution across gender, region, and age. First and foremost, our survey results clearly indicate that today's consumers are seeking clean beauty products made with organic toxic free ingredients. 74% of consumers feel that organic ingredients are important in personal care products. Yet despite this growing demand, greenwashing is more prevalent than ever before, and consumer trust in voluntary organic labels is lacking. The importance of organic ingredients in personal care products varies greatly by age. As age increases, perceived importance decreases, which may correlate with the popularity of organic products among younger generations who are increasingly prioritizing health and wellness in their purchasing habits. It's no surprise that younger people want to spend their disposable income on health and beauty, while older demographics may be more focused on paying the bills and sending their kids to school. However, across all respondents, only 14% found organic ingredients not important at all. A majority of respondents, 88%, see a benefit to purchasing personal care products with organic ingredients. The most commonly cited benefit of organic ingredients in personal care products is a positive impact on personal health, with thirty four percent of respondents holding this view. The perception is strongest among those aged 45 to 59 who see organic products as beneficial for well-being. Other benefits include the reduction of highly processed goods and the use of less chemicals and higher quality, each noted by seventeen percent of respondents. Just twelve percent of consumers see no significant benefit in choosing organic personal care products. It's clear that purchasing organic is a conscious choice. With so many health claims being used on products these days, we decided to look into the most popular claims. 36 of consumers are most incentivized by the claim natural on packaging, followed by free from statements, organic, and clean. However, this term, in addition to all of the other terms except for organic, is not regulated and could potentially be misleading consumers. 18% of consumers are incentivized by organic. And among consumers age 18 to 29, organic is the second most incentivizing claim at 25% compared to natural at 34%. Why is this important? Well, consumers are clearly making conscious decisions when purchasing beauty and personal care items. These decisions may be based off of false or unvalidated claims. A voluntary label can include any health claim on a product's packaging or the product itself and is not often validated by the company or a third party organization. Voluntary claims include natural, green, eco friendly, nontoxic, free from, and more. Trust in voluntary labels claiming organic ingredients is generally weak with just 9% of Americans completely trusting voluntary labels and 18% mostly trusting the labels. Younger consumers ages 18 to 29 exhibit higher trust levels with 27% mostly trusting voluntary labels compared to ages 45 to 59 at 15% and ages 65 to 70 at 16%. The disparity in trust levels demonstrates a lack of awareness about the difference between voluntary labels and validated health claims, especially among young people. It may also demonstrate that older consumers are more cautious and mindful about health claims. Overall, consumers are willing to pay more for beauty and personal care products that are certified organic or certified to have organic ingredients. In fact, 45% are willing to pay more. 32 said maybe depending on the product, and only 22% are not willing. Younger consumers are particularly open to paying a premium with 62% of consumers ages 18 to 20 responding yes to the question. Meanwhile, 53% of thirty to forty four year olds agree. This declines among older populations with 35% of forty five to fifty nine year olds and 31% of sixty to seventy five year olds showing willingness. This may correlate with greater disposable income among younger consumers for conscious beauty and personal care products, as well as a higher prioritization of organic products within this demographic. When it comes to what consumers want to see on packaging, sixty five percent feel that a clear ingredients list can help them to identify potentially harmful ingredients. Not far behind, fifty percent of Americans feel that a clear seal or mark, such as certified organic or contains organic ingredients from a third party organization would also be helpful. This indicates a desire for better transparency in packaging and labeling. Older consumers appear to value official certifications, while younger consumers prioritize detailed ingredient lists. Again, this could be contributed to a lack of education around seals and marks, as well as the need for more products to carry validated marks that inform consumers. There are several certifications out there for consumers seeking conscious beauty products. USDA organic can apply to beauty products. However, because the National Organic Program organic regulations were designed for food, it is often challenging for personal care products to be certified more than 95% organic as they contain non food ingredients and undergo complex manufacturing processes. One of the only consensus based standards for conscious beauty, NSF three zero five is a standard that we developed and published due to the challenge many personal care product manufacturers face in achieving USDA organic. Under NSF three zero five, the product must contain a minimum organic content of 70% with labeling indicating organic content percentages. Certification requires technical reviews and on-site inspections of the products, labels, and facilities to verify that the product and all of its ingredients meet strict review criteria, including being GMO free. Today, NSF three zero five is considered a best practice by the Organic Trade Association. Major retailers such as Whole Foods Market list it as a credible validation for personal care products. The standard is based on the USDA's NLP structure, style, and intent. We recently redesigned and launched the certification mark to make it easier for consumers to recognize certified cosmetics and personal care products containing organic ingredients. Because it is based on the NOP, three zero five provides a pathway for products that may eventually attain 95 or even 100% organic. I thought I would share some additional data we conducted from a separate study that demonstrates consumer purchasing preferences and safety concerns around cosmetics and personal care. In 2024, we commissioned a survey of 1,000 US consumers. 100% of respondents were US Heads Of Household with budget authority who purchased cosmetics or personal care products in the previous three days. The results were overwhelming. 78% of consumers actively research the product claims of cosmetics, personal care products, indicating a growing demand for transparency and informed purchasing decisions. 82% of consumers want retailers to inspect the cosmetics and personal care products, manufacturing facilities, emphasizing the importance of quality control. Meanwhile, 86% of consumers anticipate retailers only sell cosmetics and personal care products that have undergone rigorous testing for safety and quality. A whopping 95% of consumers trust the product claims of cosmetics and personal care products that have been independently certified highlighting the significance of third party validation. As consumers are increasingly cosmetics and personal care product savvy, the survey spotlight shifts in consumer buying behavior. The top quality concerns around retailers stocking cosmetics and personal care products are non passing laboratory testing, failed quality audits, and undisclosed ingredients. Consumers are also concerned about contamination, pesticides, heavy metals, untested ingredients, unclean facilities, and improper manufacturing practices. These attitudes indicate that consumers prioritize transparency, compliance, and awareness of product content in their purchasing decisions. Consumers believe the most likely sellers of high quality cosmetics and and personal care products are national chain stores and pharmacies, direct from manufacturers, and independently owned stores and pharmacies. In this information age, consumers are awakening to the importance of product safety. 82% of consumers desire retailers to verify good manufacturing practices or GMPs, emphasizing the importance of quality control. This high percentage signals a growing awareness among consumers regarding the need for transparency and accountability in the manufacturing process. 66% of consumers assert that retailers bear some responsibility if a purchase cosmetic or personal care product fails to meet safety and quality standards, highlighting a shift in accountability. This shift signifies an increased expectation for retailers to ensure the products they offer meet rigorous standards proactively. This increased interest in tested products, as indicated by our research, is timely as the modernization of cosmetics regulation act, also known as MOCRA, is set to go into effect by the US Food and Drug Administration in December 2025. MOCRA is the nation's first cosmetics and personal care regulation update in eighty years. Mandatory elements such as facilities registration, adverse event reporting, and safety substantiation show that consumers and regulators demand more transparency in how personal care products are regulated and marketed. To support businesses with becoming compliant with MOCRA, we introduced NSF guideline five two seven for cosmetics and personal care products. We also offer NSF ANC four five five GMP, which demonstrates a manufacturer's commitment to quality and good manufacturing practices. If a product doesn't meet NSF ANSI three zero five or USDA organic, these certifications can help to demonstrate compliance with safety and quality standards and meeting retailer requirements such as Amazon's Climate Pledge friendly certifications criteria. Likewise, if a product seeking to earn compliance to guideline five two seven makes an organic claim, that claim must be verified to complete certification to five two seven. In fact, in addition to MOCRA, we are increasingly seeing retailers prioritizing these practices and setting clean beauty requirements for manufacturers. As a result, we also see upticks in label claims such as non GMO, product verified, gluten free, and more. Thank you. Feel free to contact us directly with any questions about the research or for support from NSF. I'll now pass things over to Yvonne for her presentation. Thanks so much, Josephine. Hi, everyone. My name is Yvonne Buisson. I am with NIQ on the health, beauty, and pet team. Next slide, please. And today, I'm going to share some of the insights that we've observed, or some of the trends that we've observed in the health and beauty space. Next slide, please. At NIQ, we measure sales and buying behavior in traditional retail or brick and mortar in luxury stores, and beauty specialty as well as online. This and so in doing so, NIQ can deliver the full view of beauty buying behavior. And this is important especially for brands because consumers have so many options of where they can purchase products that it's important to understand sales regardless of where they're taking place. Next slide, please. Some key overall themes that we're seeing. First of which is the importance of online or ecommerce. It has become, so very important for health and beauty, and we're gonna dive into, more details around that. Next is social selling. It has really exploded, led by TikTok Shop, but there are others that are coming onto the scene. So we're gonna talk about that. And then we'll wrap up with, view or some, insights into the generations that are engaging with health and beauty and how drastically different their, preferences and shopping behaviors are. Next slide, please. So beauty and personal care has, is is experiencing a five year trend in growth in sales. In store sales continue to be strong and resilient, but online is really where it's at, and you can see that with that 11% sales growth. So in totality, the beauty and personal care space is a $107,000,000,000 industry. More than today, more than 40% of the sales comes from online. And in total, the the space is growing by 6%. It would a few years ago, we were surprised to see online becoming, like, or representing a third of the sales, in health and beauty. And now it's, you know, close to 50%. It won't be long before we reach that halfway mark. Next slide, please. When we look at what channels or outlets are driving growth for health and beauty, this chart on the left shows that. So the x axis represents the growth in dollar sales, and the y axis represents a growth in unit sales. Amazon is located at the top right of that graph. It Amazon has experienced a very impressive double digit growth. And then on the chart on the right, we have listed out the channels, and listed kind of the importance of each channel within the health and beauty space. So MAS represents or, you know, occupies a quarter of the sales of health and beauty. But Amazon, you can see is next and is showing that double digit growth. You can see with the negatives there for beauty specialty, drug, and department stores that these three channels have experienced a softer year. What's not on the charter, is TikTok shop, and you can see the TikTok shop in year 2024 has experienced nearly a billion dollars in sales. So that is a channel to definitely keep an eye on, and we are gonna talk about that one in more detail. Next slide, please. The growth of clean beauty sales continues, as we can see from the graph on the left, but it is slowing down. And then at the top right, we have broken out the sales growth of clean beauty by channel. It's really interesting to see double digit growth of clean beauty sales in warehouse clubs. So think of those as, like, Sam's Club and BJ's and in dollar stores. And at the bottom right, we've listed the categories that in which clean beauty has seen the most growth. So not surprising. A lot of the, products that we would put on our skin, are seeing a lot of growth in for clean beauty. Next slide, please. We're gonna talk about some major trends that, we expect to impact beauty retail. So we'll talk about Amazon. We're gonna talk spend some time talking about social selling. We'll spend a little bit of time talking about d two c and, private label, and then we'll wrap up with, demographics. Next slide, please. Amazon is now the number one US beauty retailer. Next slide, please. Amazon has increased their SharePoint by two points versus the previous year. And since 2021, they have gained seven SharePoints within the health and beauty space. So think about during COVID, we really relied on Amazon for a lot of our shopping, and we've only seen that Reliance continue to grow coming out of COVID. You can see, from the chart on the left that the how the other channels are doing. So mask, drug, and d two c are losing SharePoints, and beauty specialty club, grocery, and department stores are kinda staying stagnant. And on the right, we've listed the cat health and beauty categories, the top selling health and beauty categories on Amazon. And we've also listed the growth that each category is experiencing. So you can see that all of these categories are really driving the growth that Amazon is experiencing for health and beauty. In totality, they've gained, there they've grown by 18%. There has been an increase in penetration, which is the measurement of the number of households that are shopping or buying on Amazon. Next slide, please. So the where is the growth coming from for Amazon? The blue tells us that nearly two thirds of Amazon's growth in sales of health and beauty comes from existing Amazon customers simply buying more. And that, 30% of their growth comes from buyers shifting their shopping from beauty and specialty in mass to Amazon. And then the remaining 5% of their growth comes from new buyers. So you can see that Amazon's really hitting its mark with the with the shoppers. They are, their replenishment model is really, you know, resonating with consumers. It's so easy to do either subscribe and save or every time I go on my Amazon app, it's, you know, shows me, you know, do you wanna buy this again? So it's making it very easy for consumers. Their fast delivery times are also, you know, very appealing to customers. And then also, once upon a time, there were concerns about fraudulent products, and that seems to no longer be an issue for these shoppers. Next slide, please. Next slide, please. Social selling is something definitely to keep an eye on. TikTok shop launched in mid, '20 '20 '3 or fall of twenty twenty three. And since in that short starting over. Sorry. Social selling is something to keep an eye on for health, especially for health and beauty. TikTok shop, launched in summer or fall of twenty twenty three. And in the short amount of time that they have been around, they have risen to be the number eight health and beauty ecommerce retailer. Of all the shoppers who have made any kind of purchase online, 12 and a half percent of them have reported to make a purchase on TikTok shop in the latest year. And in the latest six months, TikTok shop's sales of health and beauty have grown by 35%. Next slide, please. When we double click into the, what categories are selling the most on TikTok shop within health and beauty, we see that supplements and vitamins is a top selling category. And this is interesting because this is a product that we ingest, which talks about the level of trust that we have in the products we buy on TikTok shop. Facial skin care is another top seller. It's if you've ever been on TikTok shop, you may have seen k beauty products and trends. These types of products have had a lot of success on TikTok shop and where those successes are starting to leak into other channels. Lip cosmetics is another top performer, and you might be familiar with the lipstick effect where in spite of inflationary pressures, people are spending on indulgences like lipstick. And that trend is starting to shift to lip glosses, and people are looking for, lip glosses to contain ingredients that are important to them such as hyaluronic acid, peptides, and SPF. Fragrances is another top selling category, and the idea of purchasing fragrance without smelling it is interesting. But TikTok shop really enables shoppers to build their fragrance wardrobe and, by offering fragrances at a small concentration and at an affordable price. So consumers feel comfortable, building that fragrance collection without dropping a lot of money like they would with a designer fragrance. Next slide, please. There's a delicate balance between, you know, discovering new products on TikTok shop and trust. When we surveyed a panel about social selling, 68 of the panelists reported that they had made a purchase on social selling, and 84% of them reported that they had a positive shopping experience. And some of the reasons that they had reported for social, for shopping on social sites is that they, you know, discovered a new product and that it was a convenient way to scroll and shop within the same platform. And on the right, we measure the level of trust that these shepherds have had, within with social sites. And pink represents a great deal of trust. Yellow represents a lot of trust. And you can see here that the level of trust in TikTok shop far outweighs any of the other social sites that offer shopping. Next slide slide, please. We wanted to see how much of online is represented by social selling and it's 6%. And this is led by Tic Tac Shop, but there are other players coming such as the ones seen here on the slide. In addition to these, we're we also know that Pinterest is offering shopping YouTube. I've heard Snapchat is as well. So ultimately, social selling is here to stay. Tic Tac Shop was the trailblazer and continues to lead, but others exist. And all of these sites are getting consumers, more retailer options, and it will be interesting to see how brands navigate this. Next slide, please. Next slide, please. D two c comes in a variety of, formats and we've grouped them into three buckets. First of which is pure play. Think of these as the brands who started out online and may or may not have moved into brick and mortar retail. Multilevel marketing has been around for quite some time, and these are the brands who have independent or, direct seller reps to guide customers to making their purchases on their website. And then the third bucket is the brand.com. So these are brands that originated in brick and mortar and then have started to make their, products available on their website. And this allows them to connect directly with their shoppers. But also we've seen that this, is a way for them to offer exclusive deals, for their customers. Next slide, please. All three buckets have experienced declining sales. You can see here, and this and the costs that are associated with digital advertising, you kinda you know, the thought is that these brands going in alone isn't as profitable or as viable anymore. Next slide, please. Retailers are, doing a lot of innovation with their private label brands. Next slide, please. We're starting to see a shift in trends of private label. On the left, you can see some of the categories that are seeing, you know, more sales in private label. In total, private label represents 5% of beauty sales. So it's still small, but we are seeing, SharePoint gains in some categories like bath and shower, sun care, and fragrances. Next slide, please. Retailers are really elevating their private brands. They're using viral formulations that are trending. They're using ingredients that consumers are looking for, and they're really elevating their packaging. In some cases, it's hard to tell if something is private label versus, you know, a brand that's perceived as being higher end, and some great here are some great examples. So ultimately, retailers are, offering high quality products at an affordable price, giving consumers more of a variety to choose from. Next slide, please. So who's engaging with health and beauty categories? Next slide, please. We've looked at, the different generations that are engaging, and it's interesting to see how drastically different they are from one another. You'll find Gen z doing their shopping of beauty and personal care in Sephora, Ulta, Target, and on TikTok shop, but not so much in department stores. Millennials are also shopping in Sephora, Target, and Amazon. Gen x and boomers are doing more of their health and beauty and personal care shopping in department stores, dollar stores, Walmart, not as much in Target and Sephora. Next slide, please. So and so it's important for brands to know and tailor their marketing strategy to fit the consumer that they wanna reach. It's also interesting to think about, you know, the different needs states by category and age group. And here are some examples. So face cosmetics, we do that usage or consumption peaks at, around age 35. So as we age, we are consuming or using fewer face cosmetics products. Whereas sun care, that peak usage, is around 35 to 49 age range likely due to households having younger kids that were slathering sunscreen onto. Hair color has a bit of a wider range, in terms of peak usage right between 35 and 64. And then skin care is a category where usage or consumption increases as we age. And so this is, you know, to say that there isn't really a one size fits all approach for brands to reach their consumers. Successful brands will want to consider offering a wide variety of items or brands that will meet the different needs states by age and category. Next slide, please. So we've covered a lot here, but ultimately, it's a time for flux and change in beauty. People are looking for fun, exciting products that will meet the demands of their day to day lives. People are also looking for an in store comeback. All the evolution and innovation is taking place in digital retail, and we're looking for something similar in brick and mortar. Now it'll be interesting to see who brings that experience. Thanks for your time. Any questions?