Global packaging unit volumes in the beauty and personal care industry declined slightly in 2022. In part, this can be explained as something of a hangover from the pandemic, with demand having spiked in 2020 as consumers stocked up on essential hygiene products. But the war in Ukraine has triggered a downturn in sales across Eastern Europe and continues to contribute to the rising inflation seen globally, with a severe negative drag on sales of most fmcg.
The cost of living crisis is key to understanding both decline and growth opportunities in packaging
The resultant impact on consumer spending and purchasing choices in fmcg has a direct influence on packaging trends. Inflation and the cost of living crisis now join convenience and sustainability as the key trends to understanding both decline and growth opportunities in packaging.
Inflation and cost of living crisis drive demand for small pack sizes
High inflation rates are impacting the ability of many consumers to spend, boosting sales of smaller pack types in countries with particularly large numbers of low-income consumers, as their budgetary constraints preclude them buying the larger sizes that offer a better overall price per ml/g, prompting them to opt for small sachets of essential beauty and personal care products.
The trend towards smaller pack sizes is also driven by the fact that they enable customers to try out a variety of products without committing to larger and pricier containers, allowing them to test the product and make an informed decision about purchasing a larger size in the future.
Related opportunities are increasingly evident; in China, for example, with the trend for mini fragrance bottles (5/10ml), as an affordable impulse buy for use on a night out. While unit cost per transaction is small, increased consumption this way – especially in a market as vast as China – clearly has lucrative potential for manufacturers paying attention to this shift in consumer usage patterns.
In addition, smaller pack sizes are ideal for on-the-go use, fitting easily into handbags, gym bags or toiletry kits, as well as being travel-friendly, as pack sizes of 100ml and below adhere to the maximum liquid limits allowed in hand luggage when travelling by plane.
Dynamic opportunities in squeezable plastic tubes
While folding cartons and HDPE bottles remained the leading pack types in beauty and personal care packaging globally in 2022, squeezable plastic tubes are seeing stronger growth.
Squeezable plastic tubes are leading growth in beauty packaging, with global sales up 3% in 2022
Source: Euromonitor International
Squeezable plastic tubes provide effective protection of their content, as well as offering cost-effectiveness and practical advantages, while their lightweight and compact nature makes them highly convenient for travel and on-the-go usage. However, one of their most popular features is that they enable effortless dispensing and controlled application of beauty and personal care products, helping to minimise wastage.
Long an established packaging staple in toothpaste, they are also increasingly used in categories like skin care, hair care or sun care. At a global level, squeezable plastic tubes are expected to become the number two pack type by the end of the forecast period, taking over second spot from HDPE bottles.
There are also sustainability developments within squeezable plastic tubes, including Colgate-Palmolive’s plans to share its 100% recyclable HDPE mono-material squeezable plastic tube technology with producers of toothpaste and other products that use this packaging format to help drive the move towards a circular economy.
Sustainability remains an over-riding theme in beauty and personal care packaging. Many of the major players in this industry, including Colgate-Palmolive and Unilever, have committed themselves to using only recyclable, reusable or compostable plastic packaging by 2025.
In addition, ongoing innovation in this area continues to offer manufacturers and, ultimately, consumers interesting new pack types that align with people’s increasingly environmentally-aware shopping habits.
South Korea’s Amorepacific has developed new paper-based tube packaging with a patented “nano-membrane” barrier, for example, while LG Group is recycling plastic waste using a “supercritical” water pyrolysis technique. L’Occitane – with the help of Albéa Tubes and LyondellBasell – is using squeezable cosmetic tube packaging made from recycled oils obtained from end-of-life recycling streams, while, with packaging start-up Paboco, L'Oréal has developed paper bottle packaging that includes a cardboard shell containing a bag made from recyclable food-grade plastic.
Markets to Watch
More sophisticated innovation centring around sustainability will be increasingly important to the major developed markets of Western Europe and North America. But in terms of actual volume gains, Asia Pacific will be the main growth driver for beauty and personal care packaging, adding more than half of new volume gains expected to be used globally in 2022-2027. Asia Pacific houses three of the five biggest markets globally – India, China and Indonesia. India alone is expected to contribute 3.3 billion units in new sales from 2022-2027. Indonesia will the fastest growing of the top 10 most significant markets for beauty packaging, with volume sales rising by a 3.4% CAGR. Other Southeast Asian markets like Malaysia (8.5% CAGR), Singapore (7.0%) and Thailand (5.0%) are also forecast to see surging demand in the next few years.
Euromonitor International’s latest reports, data and analysis on beauty and personal care packaging can be viewed and purchased here.
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