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Natural Health, Beauty 2011 U.S. Sales - $8.5 Billion


NEW YORK—Natural health and beauty care (HBC) product sales through all U.S. retail channels will reach $8.5 billion in 2011, according to Packaged Facts' "Natural and Organic Personal Care Products in the U.S." report. The total increase since 2005 has been $3.7 billion, for a compound annual growth rate (CAGR) of 10 percent over the six-year period.

The skin care category within the overall natural HBC market grew 11 percent in 2011. A return to double-digit sales growth reflects the ongoing strength of natural skin care products in the U.S. marketplace, and consumers' continued faith in the functional and remedial possibilities of these products: protection from weather and pollution, reduction of wrinkles and other signs of aging, even relief of stress by pampering the skin.

Hair care was the fastest-growing category within the market in 2005 to 2011. Hair care's retail dollar sales climbed 86 percent over the six-year period to reach $2.1 billion. Sales growth patterns for natural hair care, nonetheless, varied significantly from year to year, according to the report. Traditionally, hair care brands are the most vulnerable to commoditization, whether in the natural or the conventional product arenas. What helps natural/organic hair care brands to defy this ongoing pressure is the extraordinary consumer faith in the natural/organic products. A second powerful category driver is many HBC marketers' attention to hair care products as a growth strategy, a trend that has been evident since 2007. In the natural HBC realm, one example is Now Foods' extension of its namesake brand of supplements into fruit or herb-infused shampoo.

Natural makeup, valued at $455.0 million at retail in 2011, is a relatively smaller product category, and has posted very respectable but less stellar growth rates since 2005. Yet by any industry-wide yardstick natural makeup is another strong performer, despite the difficulties that marketers face in obtaining sell-through in brick-and-mortar stores for selections of hundreds of eye shadow, lip color or nail polish shades. Makeup packaging are also a hurdle, for they typically cost more than the products they contain-as also do the slick countertop or freestanding fixtures that marketers must often supply. Natural/organic makeup is also sometimes held back by consumer worries that its effects are not as dependable as mainstream makeup, nor as elegant.  As of 2011, nonetheless, well-performing natural/organic makeup products brands like Aveda, Bare Escentuals, Dr. Hauschka, and Tarte are streaming their way to retailers' shelves.

Natural HBC sales are unlikely to "find their level" soon, according to David Sprinkle, publisher of Packaged Facts, such that this thriving market will start to behave conventionally, struggling to post dollar increases that keep ahead of inflation rates.  Natural/organic skincare, hair care and makeup products will continue to be excellent performers as Americans seek to stay or become healthy, equate health and fitness with an attractive appearance, and keep the faith about the special efficacy and desirability of natural and organic personal care products.

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