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What makes United States Cosmetics Market glow?

Product Overview

Cosmetics are the product or substances used to alter or enhance the appearance or fragrance of the body. Many cosmetic products are designed for applying to the hair and face. The cosmetic products are generally mixtures of chemical compounds as some being synthetics and some being derived from natural sources (like coconut oil). Most common cosmetic includes mascara, lipstick, eye shadow, foundation, rouge, skin lotions, skin cleansers, shampoo, perfume, cologne and hairstyling products (gel, hair spray, etc.). Cosmetics which are applied to the face to enhance its appearance are called as make-up or makeup. Growing popularity of cosmetics in the United States in contributing to the growth of United States Cosmetic Market.

Key factors driving the sales of cosmetics in United States

High demand for anti-ageing products in the United States is expected to drive the cosmetics demand considerably over the forecast period. The United States cosmetic market has witnessed demand shift towards natural and organic cosmetics, which is providing avenues for growth. Factors like rise in disposable income, increasing consumer awareness are estimated to contribute significantly towards the industry growth in the coming years. In the U.S., a growing population demanding luxury personal care products is fueling the higher demand for cosmetics in the country. 

    Figure 1: United States Per-Capita Household Final Consumption Expenditure, 2012-2015 (USD)
                                                                                                                  Source: World Bank

Government Regulations for United States Cosmetics Market

In the U.S., the Food and Drug Administration (FDA), which regulates cosmetics, defines cosmetics as "intended to be applied to the human body for cleansing, beautifying, promoting attractiveness, or altering the appearance without affecting the body's structure or functions". The FDA excludes soap from this category and this definition includes any material which is intended for use as a component of a cosmetic product. In 1938, the U.S. passed the Food, Drug, and Cosmetic Act authorizing the Food and Drug Administration (FDA) to oversee safety via legislation in the cosmetic industry and its aspects in the United States. The FDA joined with 13 other federal agencies in forming the Interagency Coordinating Committee on the Validation of Alternative Methods (ICCVAM) in 1997, which is an attempt to ban animal testing and find other methods to test cosmetic products.


Global Cosmetics Market Overview

Improved living standards along with rise in the consumer disposable income in developing countries like India, China and Malaysia is expected to fuel the Asia Pacific cosmetics market. North America is a matured market, which is expected to witness significant growth over the foreseeable future. The growth in the region is primarily attributed to introduction of innovative and advanced products and high R&D developments. Estée Lauder, Coty, L'Oréal, Avon Products, LVMH, Amway, P&G, Clarins Group, Lakme, Chanel, O Boticário, Revlon, Kao, and Unilever are the major players of global cosmetics market. In recent years, anti-ageing and organic products have emerged as the most popular segment on account of consumer demand to improve their appearance, look youthful and more usage of chemical free products.

Figure 2: United States Female Population Share (As a %age of Total Population, 2012-2016 (%)

                                                                                                                           Source: World Bank

Increasing Online Sales of Cosmetic Products

Now-a-days, online sales channels exhibit the high growth opportunities in terms of sales due to upsurge of several e-commerce websites. The digital revolution has played a crucial role in driving the cosmetic demand worldwide as well as in United States cosmetic market. Online marketing and sales channels are adopted by several vendors by enabling them to reach mass markets and maintaining closer relationship with the consumers. Social or digital media helps companies to reach out to their customers, also generate awareness related to the products and attract new potential customers, which further fuel the United States cosmetics market over the forecast period.

Figure 3: Global Internet Penetration Rate, By Region, June 2016 (%)

                                                                                                     Source: International Telecommunication Union


Source: International Telecommunication Union

Shifting Preferences Towards Organic Cosmetics

The demand for organic cosmetics in the United States is anticipated to grow further in the coming years on account of increasing awareness about skin related diseases caused due to chemicals used in manufacturing standard cosmetics. People who use conventional chemical cosmetics are prone to diseases such as cancer and other chronic diseases and allergies, due to presence of chemicals such as zinc oxide, BHA, barium sulphate, etc in the conventional cosmetics and increasing awareness about the benefits of organic cosmetic is pushing consumers to opt the organic cosmetics.

Table 1: United States Organic Cosmetics Market Size, By Value, 2011-2021F (USD Billion)

                                                                                                           Source: TechSci Research

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Table 2: United States Organic Farming Statistics, 2015

                                                                                                                                                                                      Source: FIBL-IFOAM survey 2016

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