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Could halal cosmetics be developing into a new global C&T niche market?

| 29/01/2010 | Reply

28 May, 2009 – CosmeticsBusiness.com

Demand for halal cosmetics worldwide is on
the rise, driven not only by more affluent Muslim consumers but also
growing interest in high quality, safe products. Sales of all kinds of
halal-certified goods have surged in recent years alongside higher
purchasing power in Muslim countries. Estimates for the global halal
market range from US$547bn, according to the Malaysian Industrial
Development Authority, to US$2.1 trillion, a figure cited widely by
international media. Whatever the real size, everyone agrees that food
accounts for the majority of sales. But new product categories are
emerging.

“Before, people thought halal was only about the
way you slaughtered an animal. Now awareness has moved from food to
cosmetics and even pharmaceuticals,” says Irfan Sungkar, industry
advisor to KasehDia Consulting, a Malaysian research firm that organises
the annual World Halal Forum conference.

Unlike views on halal
food, which tend to be similar across Muslim countries, attitudes to
cosmetics vary widely. As global management consultancy AT Kearney
points out in a report published last year: “in principle wearing
cosmetics is haram (forbidden) no matter how they’re made, so the idea
of halal is essentially moot.”

But for those Muslim women who do
wear cosmetics, many like the idea of applying products that are
prepared without pork fat and alcohol, even though they are not eating
these forbidden ingredients. “A lot is about interpretation,” explains
Hin Yuen Choy, managing director of Malaysian cosmetics firm Unza.
“Conservative Muslims may wish to avoid alcohol altogether.”

Others
simply want to assert their identity, suggests AT Kearney’s report,
Addressing the Muslim market. “Even as they lean towards western-style
products and lifestyles, many Muslims increasingly make choices that
reassert their identity as Muslims and respect their ummah (community),
the Qu’ran and sharia principles. Many consciously seek out products
with an Islamic brand.”

Halal cosmetics have been available in
Malaysia for about 30 years but they have seen especially strong growth
in recent years and now make up 10-20% of the total market, estimates
Choy. Unza’s Safi brand for instance, introduced in 1985, includes skin
care, colour cosmetics, hair care, shower cream, fragrances, deodorants
and toothpaste. All products are formulated without alcohol and do not
contain animal-derived emulsifiers or gelatin. Suppliers have to be
certified that they are not using the same equipment to make halal and
non-halal ingredients.

Making edt without alcohol is challenging
and results in a product that does not perform as well as standard
fragrances, admits Choy. But despite such issues, the range recorded
sales growth of 25% last year, compared with about 5% for the overall
market. Part of that growth is coming from the halal certification, he
believes. Sungkar said Muslims may simply want more assurance that the
cosmetics they are using are healthy and sustainably sourced. “Halal
comes together with ‘thoyyib’. That means it’s good for you and safe and
doesn’t harm the world and animals around you.”

Other Muslim
markets are less developed. Indonesia, with the world’s largest Muslim
population, has a relatively small halal cosmetic market. And despite
recent attempts to promote halal cosmetics in the Middle East, companies
report lower interest in this region than Asia or even Europe. Unza’s
Dubai office has not seen any demand for a halal range and instead sells
the company’s other brands.

A recent
KasehDia survey also found that consumers in Saudi Arabia and the United
Arab Emirates (UAE) were least aware of halal cosmetics when compared
with consumers interviewed in Europe and Asia. “For them, halal is only
about meat products,” said Sungkar. The findings underline the problem
with defining halal markets. “Islam is a religion and a culture, lived
differently in many areas of the world. Hence the concept of a Muslim
market is in many ways nebulous,” noted AT Kearney.

Dr Mah
Hussain-Gambles, founder of halal-certified Saaf Pure Skincare in the
UK, believes Muslims need to be educated about the market. “What you put
on your body is also absorbed into the skin. And halal is not just
about pork-free and alcohol-free products but also about safe
ingredients, corporate social responsibility and the ethical side of the
business.”

Some companies are already popular among Muslim
consumers for this reason, despite having no halal certification. “The
Body Shop boasts natural ingredients..and its marketing efforts are in
line with Muslim values,” says the ATKearney report.

Greater
availability of halal products could raise demand for certification
however. “The thing is to create doubt among Muslim consumers that what
they are already using is maybe not halal,” said Choy. This approach
triggered reaction from multinationals keen to grow their market share
in Malaysia. Choy claims that Colgate-Palmolive launched a
halal-certified toothpaste in the country in response to growing sales
of Safi toothpaste [Colgate declined to be interviewed]. When Unza
launched a new Safi baby products range, Johnson & Johnson also
sought halal certification, adds Choy.

But most halal cosmetic
manufacturers remain smaller, niche players such as Australian firm
Almaas, which makes halal colour cosmetics, or France’s Candea with its
Jamal brand. These innovators may find demand from non-Muslim markets
too. Most of Saaf’s sales are to non-Muslims in Europe, according to
Mah. This is partly because the company has organic and vegetarian
accreditation. But the halal certification allowed the firm to show that
the products do not contain irradiated ingredients, alcohol or
genetically modified organisms. “Halal covers all three.”

Mah
believes that a halal label could be seen as the next “eco-ethical
accreditation. People are looking for the next pure cosmetic.” Haji
Harith Kassim, a Malaysia-based consultant who has worked with
Colgate-Palmolive, agrees. “Halal is not only religiously pure but is
also manufactured with the highest standards of quality. Before you can
use a halal logo, you have to be rigidly audited.”

In the current
economic environment, a halal certification may create new
opportunities, he adds. “Here is the new USP [unique selling point].”

Category: Asia, Personal Care

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