Nutriceuticals: Dish of the day for the beauty market
Author: Diana Dodson
Date published: 10 Oct 2007
The cosmetics and toiletries market can no longer be seen in isolation but as part of a wider beauty industry that includes food and dietary supplements as well as topical treatments. Euromonitor International takes a closer look at these complementary products springing up around the traditional beauty market – termed nutriceuticals and including both beauty foods and supplements – and makes predictions about their future.
The global beauty supplements market alone was worth at least US$2.1 billion in 2006 and accounts for upward of 8% of total dietary supplements sales according to Euromonitor International figures, not bad for a product segment that only began gaining serious consumer and media attention over the past five years. Foods positioned as beauty-enhancing are an even newer concept in Western countries, but with the rise of high-value functional foods they have become the logical next step for innovation. Nutriceuticals have finally been recognised as an important new category, included for the first time in 2007 in the programme for annual food ingredients event Vitafoods International.
Driving demand for nutriceuticals is a growing appreciation among consumers of the role nutrition plays in beauty, spurred on by soaring obesity rates and television shows such as the UK's You Are What You Eat, which underlines the effects of poor eating habits not just on waistlines, but on skin, hair and nails too. Pressure to look good all the time is also pushing consumers to find an arsenal of beauty measures and making them more willing to pay a premium for added cosmetic benefits. Increasingly the trend is towards a more natural look and beauty-from-within is better aligned with this ideal than the short-term fixes topical products provide.
Competitive pressures are also driving manufacturers, in the cosmetics and toiletries, OTC healthcare and food and drink industries alike to expand their offerings with high-value products in an exciting new niche. New health claim regulations in the EU are also expected to spur further development, in beauty foods particularly. Faced with tighter controls, companies are likely to opt to make added-benefit claims that are not strictly health related.
Asia-Pacific leads the way in nutriceuticals
Japan is by far and away the most developed market for nutriceuticals, although the Asia-Pacific region generally is an important market for these products. Consumers have a long-held awareness of the role of food, drinks and dietary supplements (particularly in the form of nutritive tonics) in health, wellness and beauty. Their receptiveness to this concept has opened the way for an innovative nutriceuticals market crowded with products so novel that they struggle to find credibility beyond Japan. Examples include collagen-enriched soup from Nissin Food Products, – it sounds unappetising but should be well-received in a market that already correlates chicken soup with healthy skin – Shiseido's pureWhite skin whitening drink, and edible fragrance Fuwarinka – a candy that releases a vanilla scent via the sweat glands.
Collagen-filled marshmallows from Japanese confectioner Eiwa failed to sell when they were brought to UK shelves in 2006. However, they did receive considerable media attention, even from the mainstream press, and a range of other nutriceutical products have been making moderate progress in Western markets. Ferrosan's Imedeen, Inneov (the result of a joint venture between L'Oréal and Nestlé) and Olay Vitamins are some of the better-known beauty supplements on the market, and the concept has become so widely accepted, private label ranges have sprung up to challenge the brands.
Beauty foods are a newer development in Western markets, but they are gaining ground, particularly in dairy, a key sector for fortification. In February 2007, dairy giant Danone launched Essensis beauty yoghurt in France and other select Western European markets. Functional bottled water and ready-to-drink tea are the other main categories where beauty benefits are claimed. Coca-Cola, for example, is teaming up with L'Oréal to produce a tea-based skin care drink Lumaé, due to be launched in 2008. Like Borba Skin Balance waters, which are stocked in beauty specialist Sephora, Lumaé will be distributed through upmarket cosmetics retailers, such as department store Saks Fifth Avenue, rather than the usual soft drinks channels. Some smaller companies are forging new ground with more experimental offerings, including French firm Laboratoires Noreva's Norelift anti-ageing jam. Chocolate could also become a key beauty sector; rich in anti-oxidants the food industry has already put a lot of work into repositioning this guilty pleasure as healthy.
In terms of Western markets, Spain is emerging as one of the most important for beauty foods. There is already strong demand in Spain for fortified foods - the country has the third highest per capita consumption in the world - and increasingly functional claims are focusing on beauty. This is partly because local consumers place a high priority on looks. According to the Spanish Association of Cosmetic Surgery (Sociedad Española de Cirugía Plástica, Reparadora y Estética), more women undergo cosmetic surgery in Spain than in any other European country. Also driving this market is the predominance of UHT, as opposed to fresh dairy in Spain; long-life products are more easily fortified and slimming supplement tonalin is among the ingredients that are finding their way into the dairy sector. For this reason too, the US holds strong potential for beauty foods.
Science to silence the sceptics
Skin care stands to benefit most from the nutriceuticals trend. This is because skin care generally has become a major priority for consumers worldwide (at US$60.1 billion in 2006, it is the global cosmetics and toiletries market's most valuable sector). The publicity around foods high in “age-defying” antioxidants, including so-called superfruits such as pomegranate and blueberries, also means skin care claims predominate among beauty foods and supplements. Hair and nail care, however, are also key sectors for nutriceuticals, and increasingly sun protection and tanning products such as Inneov Solaire are coming to populate the market. Inneov Solaire is positioned as an oral sunscreen and contains probiotics to promote the skin's natural defence against UV rays.
In terms of the core market for these types of products, women aged 40 and over are the primary target. This is the group most concerned with health and wellness generally and which sees beauty as part of that concept. There is real scope for expanding the market to include younger women, too, in much the same way the anti-ageing sector has been successful in attracting women as young as 30. Nutriceuticals could also appeal to men, but for this group, the younger set should be easier to appeal to, particularly with high-protein, muscle-building products.
To encourage a wider array of consumers to the market, education is key. The challenge for manufacturers is to raise awareness of how nutriceuticals work and prove their efficacy. Western consumers particularly are sceptical about product claims, particularly where they relate to beauty, and will dismiss beauty foods and supplements as marketing gimmicks unless they are supported by rigorous scientific research. NV Perricone MD is one brand that is succeeding in bringing consumers to the nutriceuticals market, selling on the concept that skin care means a combination of nutrition, supplementation and topical treatments. Nutritionists contribute to new product development and claims are backed up by the results of clinical studies. Beauty supplements can also be expensive, a further barrier to sales, especially among younger age groups. A one-month course of Perfectil, for example, costs £39.49 (roughly US$80). There could be safety issues for some consumers, too.
A wider retail platform is vital for long-term success
Euromonitor International predicts a bright future for nutriceuticals. Demand for traditional cosmetics and toiletries is booming (Euromonitor International expects the market to expand by a massive US$42.9 billion over 2006-2011 to US$312.5 billion worldwide), and yet consumers are increasingly looking beyond this industry for beauty solutions, including food and supplements but also spas, salons and clinics. The coming years are expected to see the rise of new beauty food formats including cereals, fruit juices and even confectionery. Nestlé used the Philippines as a test market in 2006 when it launched Nescafé Protect, a coffee high in antioxidants, and if successful, this unlikely beauty drink could find its way onto the global market.
Nutriceuticals are also expected to become more sophisticated in their market positioning, targeting a wider range of select consumer groups. Besides segmenting the market by age and gender, ethnic-specific products, catering to the unique qualities of skin and hair of different ethnic groups, could also be an area for development.
There is a threat of regulation, however, which could restrict manufacturers as to the beauty claims they can make, similar to the way health claims are controlled. Until nutriceuticals find a wider retail platform too, sales will be restricted. At present beauty foods are primarily sold through health food stores and specialist stores such as Holland & Barratt. They have yet to find their way into mainstream supermarkets. For beauty supplements, the primary channel is pharmacies and drugstores.
Cosmetics and Toiletries