Global Premium Hair Care Market - Growth, Trends, and Forecasts (2022 - 2027)

The global premium hair care market is projected to register a CAGR of 6.6% during the forecast period, 2022-2027.

The COVID-19 pandemic had positively influenced consumers' spending habits and purchase decisions and had also witnessed a slowdown in growth owing to various governments imposing multiple measures intended to slow down the spread of COVID-19. Some basic initiatives included social isolation directives, limitations on business opening hours, and travel restrictions. According to the International Journal of Dermatology and the US National Library of Medicine, hair loss had been found to be a late onset symptom of COVID-19 with almost 25% of patients reporting the issue and Telogen effluvium (an acute hair loss that is experienced when the body goes through physical trauma such as illness, pregnancy or even a crash diet). Another notable trend is the rise of do-it-yourself (DIY) hair care products and routines. As many beauty salons had closed, and even in places where they were not, consumers had forgone services owing to concerns over close physical contact. As a result, DIY hair coloring is finding new customers with the hair dye sales increasing 23% in Apr 2020 (Y-O-Y) as stated by Baird.

Over the medium term, consumers across the global market face varied hair care-related problems, among which, hair loss and oily scalp are the most common ones. These problems are mainly due to hot and sweaty weather conditions, pollution, among others which lead the consumers to shampoo their hair daily, removing the natural oils present in the hair or scalp. This in turn is driving the global premium hair care market.

Increasing celebrity endorsements and raising awareness about the harmful effects of chemicals and synthetic products augment the demand for natural/organic, and vegan hair care products, along with ease of usage and availability of small travel-size packs acting as significant trends observed in the market.

Key Market Trends

Growing Appeal For Organic and Natural Products

The global premium hair care market is witnessing an increasing demand for natural and organic products due to the rise in consumer awareness about the harmful effects of certain compounds, such as paraben and aluminum compounds present in hair care products. A high percentage of consumers choose one brand over others based on its natural formulation. This enhanced the demand for safe, natural, and organic hair care products in recent times, according to DSM 56% of consumers believe that active ingredient is more important than brand, package, or fragrance when it comes to purchasing decisions.

Moreover, consumers with sensitivity tend to look for natural and fragrance-free products. In Scandinavian countries, there has been a growing shift toward fragrance-free products. Wherein according to research by Battelle Memorial Institute and Silent Spring Institute, the analysis of 18 commonly used products like relaxers, hair root stimulators, and anti-frizz products detected 66 chemicals with potentially toxic effects. The researchers also detected nonylphenol, a compound associated with obesity and a higher risk of breast cancer, in 30% of the hair treatments in the United States. Thus, the high demand for natural ingredients is evident in the market studied. It has led to most companies launching products with nature-inspired ingredients, such as plant-based and premium botanical ingredients.

For instance, in 2020, Henkel launched a brand of natural toiletries and hair care products, Nature Box, with both solid and liquid products in France. The range features five liquid shampoos and their solid equivalents, plus a conditioner. The products are incorporated of 99% natural ingredients derived from fair sourcing cold-pressed hemp, coconut, nut, argan or avocado oil in both liquid or solid product and packed in eco-packaging.

Asia-Pacific is the Fastest Growing Region

The market in the Asia Pacific region is expected to register the fastest growth rate during the forecast period due to the rising awareness about personal hygiene and well-being along with the gradually increasing disposable income levels and standards of living. Furthermore, hair care has always been a top priority for both men and women. Also, there is an increased demand for premium hair care and other grooming products by men, owing to a robust shift in attitude toward personal well-being. In addition, the vast male population in emerging countries is doing away with manual work and adopting white-collar jobs, which is further anticipated to create product demand. Millennials are one of the prominent consumer segments for premium hair care products. The influence of K-Pop culture along with Thai and Korean celebrities are creating awareness regarding the latest hair care and styling trends. This has exhibited stronger demand for coloring and treatment products for grey hair coverage and resolving hair-related concerns, respectively.

Owing to the high concern for hair care, there's a rise in demand for specialized premium products. Hair textures vary from person to person and so do the hair and scalp-related issues. Some people might have damaged or dry hair, while others have to deal with breakage and hair fall problems. As a result, specialized products are being introduced in the region that claims to fix damages caused by many factors. For instance, in 2021, Dabur India has diversified its product portfolio with the launch of a premium range of shampoos under the brand Dabur Vatika Select and each variant of the new range has a unique ingredient that solves specific hair problems.

Competitive Landscape

The global premium hair care market is highly competitive with the presence of global and small- and medium-scale regional manufacturers. The key players in the market are Procter & Gamble Company, L'Oreal S.A., The Estee Lauder Companies, Johnson & Johnson, and Unilever Plc.

Emphasis is given to the merger, expansion, acquisition, and partnership of the companies along with new product development as strategic approaches adopted by the leading companies to boost their brand presence among consumers. Companies are increasing in research and development(R&D) efforts and marketing to expand their presence globally. They are focusing on expanding their distribution network to reach out to maximum customers. Retailers are also developing their standards for natural and organic hair care products. For instance, in December 2020, Henkel Beauty Care announced the launch of several products in 2021 for organic brand NAE and Schwarzkopf hair dyes. It also launched a brand of natural toiletries and hair care products under the name Nature Box, an environmentally friendly brand in France.

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