Marine biotech is ‘land of opportunity’ for cosmetics
In the paper ‘Global Marine Biotech Market 2012-2016,’ the company identifies several aspects of marine biotech which are of interest to personal care companies, including the strong appeal of these products to consumers in Europe and North America.
The report also suggests that these products can be useful sources of innovation and provide interesting solutions to common beauty problems. The overall market for beauty and personal care products based on marine biotech shows healthy growth, increasing in size by roughly 5 percent per year.
Developed markets such as America and Europe are particularly strong regions for these products, with a large percentage of world demand coming from these areas. Demand in emerging markets is also growing steadily, with a pattern of smaller and more affluent groups of consumers driving spending.
The analyst comments: "All marine life from microorganisms to krill could offer potential solutions for range of markets such as Healthcare, Human Nutrition, Pharmaceuticals, and Cosmetics and Personal Care."
"While Human Nutrition and Pharmaceuticals are the key end-user segments of marine biotech products, the Cosmetics and Personal Care segment is expected to be the fastest growing end-user over the next few years."
Hi-tech appeal for the Western market
The report highlights the fact that 50% of all demand for cosmetics and personal care products with marine-based ingredients comes from North America and Western Europe, with the products having great appeal in developed markets.
Technavio suggests that companies can gain good positioning by adopting marine-based biotech, with ingredients being especially important for branding thanks to potentially offering an “unconventional” solution to common beauty problems.
The market for products with marine-based ingredients is driven by innovation and is highly under-developed, creating a great opportunity for firms to expand to fill the vacuum. Existing companies are developing cosmetics for applications such as anti-ageing, moisturizing and Vitamin C complexes.
However, Technavio also identifies important barriers to entry for companies, particularly the high R&D investment required to develop worthwhile products. It identifies the trend of existing companies which specialize in this area, including Norway-based Aqua Bio Technology, as increasingly partnering with well-known brands such as Amway, thus providing benefits in innovation and marketing for both parties.
Chinese and Indian potential
Demand for these products is also picking up in the Asia-Pacific region, following a different pattern to the West. The well-known growth of disposable incomes in countries such as India and China is resulting in a small, affluent consumer base for high-end cosmetics being created in these regions.
Technavio suggests that catering to "price-sensitive" consumers is the best approach for companies in this region, in order to reach a wider range of customers.