Vegan Cosmetics Market Size, Share & COVID-19 Impact Analysis, By Type (Skin Care, Hair Care, Makeup, and Others), Distribution Channel (E-commerce, Hypermarkets/Supermarkets, Departmental Stores, Specialty Stores, and Others), and Regional Forecast, 2021-2028

The global vegan cosmetics market size was USD 12.72 billion in 2020 and is projected to grow from USD 15.87 billion in 2021 to USD 24.79 billion in 2028 at a CAGR of 6.57% during the 2021-2028 period. The global impact of COVID-19 has been unprecedented and staggering, with vegan cosmetics witnessing a negative impact on demand across all regions amid the pandemic. Based on our analysis, the global market exhibited a lower growth of 18.47% in 2020 as compared to the average year-on-year growth during 2017-2019. The rise in CAGR is attributable to this market’s demand and growth, returning to pre-pandemic levels once the pandemic is over.

The concept of veganism is rapidly evolving into the mainstream within the cosmetics category, backed by an expanding group of consumers emphasizing sustainability. In this respect, cosmetics brands worldwide are encouraged to develop cruelty-free cosmetics. Furthermore, renovation in production is likely in the coming years as cosmetic manufacturers are increasingly focusing on improving their sustainable practices, from raw material procurement to product distribution.

COVID-19 IMPACT

Severe Supply Chain Disruptions Caused by COVID-19 Pandemic to Hamper Market Expansion

The COVID-19 outbreak caused unprecedented supply chain disruptions in the market. The new physical distancing mandates and global lockdown measures meant that most vegan cosmetics were a part of the non-essential products category. In this respect, the novel COVID-19 pandemic has created a far-reaching shift from a consumer and product distribution standpoint. As is the case in the overall cosmetics category, the COVID-19 pandemic contributed significantly to digital acceleration, most notably throughout 2020, with numerous online retailers demonstrating relevancy and adaptability to rapidly changing situations. The vegan cosmetics industry is now reworking its current models to navigate the impacts of the COVID-19 pandemic. This will certainly require dedicated efforts on lines of innovation and technology upgradation.

Despite the challenges posed by COVID-19 on supply chain management and negatively influencing consumer preferences, the prospect of luxury beauty, notably in Southeast Asia, will encourage vegan cosmetic brands and retailers to achieve regional expansion in the near term. As the market gradually recovers from the impact of the COVID-19 pandemic, vegan cosmetic brands are likely to make aggressive marketing investments to stay competitive. In this respect, a brand’s post-pandemic performance and recovery will principally depend on the level of product differentiation and digital acceleration. These factors will also play a key role in contributing to the industry’s market size.

LATEST TRENDS

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Celebrities Launch their Vegan Cosmetic Product Lines to Augment Market Volume

Amid intense competitive rivalry, recent years have witnessed a significant number of celebrities worldwide entering the cruelty-free beauty space. For instance, in November 2021, Harry Styles, a U.K.-based actor, songwriter, and singer, unveiled Pleasing, his new and first vegan beauty brand, including a complete line of vegan skincare products and nail polishes. In another instance, E.l.f. Cosmetics, Inc., a California (U.S.) based cosmetics brand, announced that it has partnered with Alicia Keys, a U.S.-based actress, songwriter, and singer, during the first half of August 2020 to launch a new line of vegan beauty products. An increasing number of product launches by celebrities worldwide also highlights the rising consumer interest in novel & innovative products. 

DRIVING FACTORS

Rising Popularity of Plant-based Products Paired with Emerging Veganism Trend to Favor Market Expansion

Given the rising global concerns regarding the production and consumption of cosmetics featuring synthetic ingredients, consumers are increasingly embracing plant-based substitutes, which in turn, is favoring market expansion. At a macro level, emerging raw material (vegan ingredients) sourcing destinations worldwide significantly contribute to the product demand as consumers seek innovative cosmetic products with considerable health benefits. In this respect, vegan-based cosmetic manufacturers are likely to source ingredients from South Korea (yuzu citrus fruit), Australia (kakadu plum), and Indonesia & Malaysia (rambutan) in the near future. Furthermore, evolving vegan lifestyles across countries are expected to boost the demand for vegan cosmetics in the near term.

Implementation of Bans on Animal-tested Cosmetics is Triggering Consumer Preferences for Vegan Products

Animal testing is becoming a major consumer concern worldwide, most notably in North American and European countries. While animal-tested cosmetics are banned in Europe, an increasing number of U.S. states have been considering a ban on the import and distribution of such cosmetics over the years. In this respect, Illinois, Nevada, and California were among the U.S. states that implemented a ban on importing or selling animal-tested cosmetics in 2020. Furthermore, various animal-rights groups, including the Humane Society and Cruelty-Free International, strive to get more U.S. states to implement such bans. From a vegan cosmetics manufacturing standpoint, ban on animal testing will positively affect the demand for cruelty-free products throughout the forecast period.

RESTRAINING FACTORS

High Circulation of Counterfeit Products to Hamper Market Growth

Despite the rising popularity of vegan cosmetics worldwide, the fastest growing prevalence of counterfeit products impedes the vegan cosmetics market growth. Furthermore, the high circulation of counterfeit products within the overall cosmetics category makes it even more challenging for genuine vegan cosmetic brands to compete across domestic and international markets. According to the Crime and Enforcement data published by The Intellectual Property Office (IPO), more than 2 million counterfeit body care products, including perfumes and cosmetics, were seized in the U.K. in the 2017-18 period.

SEGMENTATION

By Type Analysis

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Vegan Skin Care Products Constitute Majority of New Product Launches Worldwide

On the basis of type, the market is classified into skin care, hair care, makeup, and others.

The skin care segment held a dominant share of the market in 2020. Various studies also suggest that vegan skincare products are popular across international markets. For instance, according to a survey conducted by Digital Crew Pty. Ltd., an Australian online marketing service provider, and Monash University, a Melbourne (Australia)-based public research university, Australian Creams, a Sydney (Australia)-based organic & cruelty-free cosmetic brand, outranked nine Chinese cosmetic brands to top the list as the most-trusted Australian brand in China in 2018. The emerging trend of gifting affordable cosmetics for friends and family by Chinese students, tourists, and residents in Australia will likely introduce domestic brands to Asian countries over the forecast timeframe.

The makeup segment is forecast to witness the most significant growth in the forthcoming years. Vegan makeup products also include a variety of color cosmetics available in gel, powder, and cream form. Zao Organic Makeup, Clove + Hallow, Prime Beauty Cosmetics, River Organics, Habit Cosmetics, and MOB BEAUTY are some of the brands that market their products as 100% vegan.

By Distribution Channel Analysis

E-commerce Segment to Register Fastest Growth

Based on distribution channel, the market is further segmented into e-commerce, hypermarkets/supermarkets, departmental stores, specialty stores, and others.

Offline retail stores remain a prominent distribution channel for vegan cosmetics worldwide. Despite massive disruptions in the offline distribution space caused by the COVID-19 pandemic, recent developments & product distribution trends suggest that offline distribution will regain prominence during the post-COVID-19 pandemic. For instance, in May 2018, Holland & Barrett Retail Limited announced its plan to launch all-vegan (vegan only) stores in the U.K. This strategic move indicates similar developments in this market in the forthcoming years.

Amazon is the world’s most prominent online distributor of vegan cosmetics. Prospective brands are likely to introduce their products across domestic & regional markets through such internationally reputed e-commerce distribution platforms while establishing their presence in the offline product distribution space (supermarkets/hypermarkets, departmental stores and other physical retail establishments). While the COVID-19 pandemic has triggered an e-commerce expansion across all cosmetics categories, the growth of the e-commerce sector in the coming years will depend on how quickly traditional brands transition from offline to online sales.

REGIONAL INSIGHTS

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In terms of geography, the market is categorized into North America, Europe, Asia Pacific, South America, and the Middle East & Africa.

The market size in Europe is projected to reach USD 8.19 billion by 2028. The prominent national markets for cruelty-free cosmetics in Europe are Germany, France, the U.K., Italy, and Spain. The European market is characterized by numerous research & development centers focusing on developing cosmetics & personal care products. According to Cosmetics Europe, the European trade association dedicated to the cosmetics & personal care industry, there were approximately 77 scientific innovation centers in Europe in 2018 in connection with cosmetics & personal care.

North America is forecast to witness considerable growth in the near future. Led by the U.S., the North America vegan cosmetics market is driven by the rising popularity of natural ingredients in cosmetics. At a macro level, the increasing working women population paired with the mushrooming growth of beauty clinics across North American countries encourages cosmetic brands to achieve regional expansion. The U.S. houses many domestic brands worldwide, including Ama Sea Beauty, Clarisma, and Elevate CBD Cosmetics.

Asia Pacific is expected to witness the most significant growth over the forecast period. Emerging Asian markets is likely to encourage new players’ entry in the foreseeable future. Furthermore, recent industry developments suggest lucrative business opportunities for prospective and well-established brands in Asian countries. For instance, with effect from 21st October 2019, Taiwan banned cosmetics animal testing. This new legislation also saw Taiwan joining the rapidly increasing global momentum against cosmetics cruelty. From a cosmetics manufacturing standpoint, bans on cosmetics animal testing translate into a significant demand for certified vegan products.

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The South American, Middle Eastern, and African markets only account for a small fraction of the global sales turnover. However, these regional markets are likely to register significant growth in the coming years, given the rising consumer awareness regarding synthetic ingredients in cosmetics. While rampant poverty makes it challenging for brands to target African markets, high disposable income across Middle Eastern countries is likely to contribute to the high penetration of premium/luxury products in the forthcoming years.

KEY INDUSTRY PLAYERS

Key Industry Participants are Focusing on Product Innovation & Mergers & Acquisitions to Stay Competitive

The global market is intensely competitive, with regional and international brands striving for product differentiation. The popularization of e-commerce marketing is declining the overall market share of international brands year by year. This factor provides an opportunity for prospective/ small vegan cosmetic brands to penetrate the market, intensifying the competitive rivalry.

Prospective cosmetic brands will focus on getting the People for the Ethical Treatment of Animals (PETA) certification to achieve a more significant brand reputation and global expansion. The PETA certification can act as a tool for brands to educate consumers/shoppers that their cosmetics products are (at any stage of manufacturing) not tested on animals. Cover FX, Arbonne, Pacifica Beauty, and Beauty without Cruelty are the major brands worldwide that market their products as PETA certified. 

LIST OF KEY COMPANIES PROFILED:

• GABRIELCOSMETICS (Washington, U.S.)


• PHB Ethical Beauty Ltd (Brighton, U.K.)


• Natur'Alley Ltd (London, Japan)


• GoNature Sp. z o.o. (Poznań, Poland)


• Seraphine Botanicals (New Jersey, U.S)


• Nutriglow Cosmetics (Uttar Pradesh, India)


• Plum (Maharashtra, India)


• Disguise Cosmetics (Maharashtra, India)


• COTY INC. (New York, U.S.)


• G&M Cosmetics (New South Wales, Australia)

KEY INDUSTRY DEVELOPMENTS:

• November 2021: LG Household & Health Care Ltd, a South Korean consumer goods company, introduced seven new products to complete its Belif x VDL brand’s vegan makeup product line-up. The company markets the brand’s products as certified by the Korea Agency of Vegan Certification and Services as a vegan.


• October 2019: G&M Cosmetics, an Australian organic cosmetics manufacturer, acquired P’URE Papayacare, a 100% natural & vegan certified European skincare brand. This strategic initiative (acquisition) highlights its intent to expand its footprint in export and domestic retail markets.

REPORT COVERAGE

An Infographic Representation of Vegan Cosmetics Market

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The market research report includes qualitative and quantitative insights into the industry. It also offers a detailed vegan cosmetics market analysis with market size and growth rate for all possible segments. Various key insights presented in the report are an overview of related markets, competitive landscape, recent industry developments such as mergers & acquisitions, SWOT analysis, the regulatory scenario in critical countries, and key industry trends.

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