Maximising Prospects in Hair Care

February 2022

Experimentation with colour and at-home treatments bolstered hair care in 2020, while the forecast period will see increased price sensitivity, as the recessionary impact of the pandemic takes hold. Holistic hair care and a focus on hair health is seeing the continued growth of scalp treatments, ingredient-led hair care, bond-building and ayurvedic practices. Sustainability, purpose and ingredient sourcing are coming to the fore, while digitalisation will enable premiumisation.

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Key Findings

Strong growth expected in Asia Pacific

North America, Western Europe and Japan are seeing slow growth, with high per capita spend limiting further growth opportunities. Other Asia Pacific markets, such as China and Indonesia, are forecast strong growth, as they grow from lower usage rates and greater access to niche brands with premium qualities.

Conscious hair care develops, with a focus on purpose

Animal cruelty-free, recycled and recyclable packaging, and sustainably sourced ingredients are gaining prominence in conscious hair care, while demand for inclusive brands which place social Purpose Over Profit is growing.

Digitalisation grows communities and supports personalisation

Digitalisation is accelerating post COVID-19, with community building and social shopping supporting this. Companies must maintain their built communities and develop omnichannel capabilities, while improved technology will enable personalisation to support value sales growth.

Hair care goes Back-To-Basics

Consumers are adopting a Back-To-Basics approach to hair care, with an emphasis on efficacy, as consumers have less disposable income following COVID-19.

“Skinification” drives health focus

Demand for healthy looking hair is on the rise, with scalp health, the microbiome, skin-influenced ingredients, bond-building and ingestibles developing in this space. Ayurvedic hair care and emotional wellbeing remain mostly untapped, with more consumers seeking holistic propositions.

Premiumisation, expansion and demographic targeting key to growth

Investment in premium brands and traits can cut across key industry themes driving growth and market perception, while expansion in lifestyle propositions and high-growth markets can solve issues of stagnation. Catering to the needs of overlooked baby boomers offers opportunities, while brands must connect with Gen Z through social media.

Key findings
Hair care sees growth recover in 2021
Premium leads growth while mass leads market value
Asia Pacific drives growth from low per capita spend
Sales in China dominated by shampoos
Self-care and salon shifts drive treatment sales
M&A activity in hair care is limited during the review period
Companies with strength in colourants see shares grow in 2020
E-commerce booms while department stores stagnate
Asia Pacific forecast to lead growth
Western Europe to see only marginal growth
Aligning with key trends key to future growth
Eco-anxiety drives demand for sustainability
Cruelty-free and recyclable packaging drive conscious hair care
Ethical demand varies by generation
Brand claims align with consumer demand
Marketing, initiatives and formulations drive inclusivity
Solid shampoo bars launched by mass-market Garnier
Dow caters to multicultural hair through The Most partnership
COVID-19 drives digitalisation
Advice, community and entertainment lead digitalisation
Technology access limits digitalisation
Personalisation to drive premiumisation
Personalisation fosters product development
Personalisation enters bricks-and-mortar
Amazon embraces phygital reality through its Amazon Salon
Back-To-Basics incorporates self-care, efficacy and price hybridity
Brands aim to validate their efficacy
Ingredient transparency demand soars
Natural styles and food inspiration emerge
Molton Brown adopts vertical farming for ingredient supply
Demand grows for health-led features
Hair concerns rooted in the scalp
“Skinification” extends to hair strands
Utilising ingestibles and topicals to target more holistic concerns
Future growth from ayurvedic and “emotional” hair care
P&G incubates scalp-led Kimea
Older consumers seek clinical, solution-based products
Younger consumers engage online with ethically aligned brands
Asia and cross category expansion solve stagnation
Functional and emotional value-added traits to drive focus on premium
Key recommendations

Beauty and Personal Care

This is the aggregation of baby and child-specific products, bath & shower, deodorants, hair care, colour cosmetics, men's grooming, oral hygiene, fragrances, skin care, depilatories and sun care. Black market sales and travel retail are excluded.

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