With global spending by Muslim consumers on cosmetics expected to rise to $73bn by 2019, up from $46bn in 2013, according to recent research from Thomson Reuters, companies are closely monitoring the demand for halal beauty products.
Simply, halal refers to that which is permissible under Islamic law. Beauty products that claim to be halal should not contain excessive amounts of alcohol, animal or pork ingredients, and be produced and packaged in a clean environment not harmful to humans.
In a clear sign of the growing importance of halal in cosmetic products, Esma, the United Arab Emirates’ (UAE) standardization body, last year introduced a halal mark and certification for foreign companies looking to tap into demand for these products. The organization said halal certification had become a key marketing opportunity for beauty companies. Through its customs regulations, Esma aims to ensure that all cosmetics sold in the UAE are halal by default. “Before exporting to the UAE, companies should get our certificate for halal to export,” Esma acting director-general Abdulla Abdulqader Al Maeeni said in a statement.
In Saudi Arabia, a report by Techsiresearch estimated that the market for halal cosmetics there would grow 15% between 2015 and 2020. It said increased availability of halal products, coupled with rising consumer awareness of the benefits and a willingness to pay more for high-quality halal cosmetics would drive growth.
In light of this, both local and multinational beauty players are shifting their strategy to accommodate the growing halal cosmetics market. To date, the halal beauty market in the Middle East has been dominated by local or niche brands. Dubai-based OnePure, whose manufacturing operations are verified halal by an imam, distributes its prestige products in Galeries Lafayette, for example. Australian organic brand Inika, which is certified halal by the Australian Federation of Islamic Councils, is gaining a foothold in Saudi Arabia and elsewhere.
But multinational beauty players are beginning to enter the fray. Japanese group Shiseido has developed a halal-certified skincare line called Les Divas for the Bangladesh market. Market-research company Euromonitor International notes that Polish make-up brand Inglot, which has global reach, released a halal nail polish, while Anglo-Dutch group Unilever ceo Paul Polman has talked of exploring options to scale up halal beauty products.
The Middle East is also a popular export destination for halal beauty products from large Muslim countries like Indonesia, and Malaysia, which reportedly exports a third of its halal beauty and personal-care products to the UAE. In Indonesia, where some 90% of its 255 million citizens are Muslims, the impact of the country’s 2014 Halal Product Certification bill that requires all products sold in the country be certified halal by 2019, could be significant for global manufacturers.
Indeed, beauty companies will be unable to ignore the growing demand for halal beauty products. But to get into this market, the multinationals will need to have a good understanding of Islamic rituals and develop distinct brand identities and clear marketing messages in order to be competitive.