Despite its significant potential and growing interest from international beauty brands and local players, the Gulf Cooperation Council’s (GCC) halal cosmetics market remains underserved.
A new report has revealed global spending on cosmetics by Muslim consumers will hit $93 billion within three years, sustaining a four-year compound annual growth rate (CAGR) of 7.2%.
This followed an estimated worldwide turnover of $70 billion in 2021.
According to the State of the Global Islamic Economy (SGIE) 2022 report, there was an increasing demand among Muslim consumers for halal-certified products and services, driven by the growing Muslim population.
See - Infographic SGIE 2022: Halal cosmetics
Catherine Collins, a qualified halal assessor and founder of London-based beauty and wellness agency Constellar Consultancy, said there were now more than 2 billion Muslims in the world and a burgeoning demand for halal-certified products. She said there has been significant growth in the Asia-Pacific region where Indonesia required new beauty products to be halal certified and expected Malaysia and Saudi Arabia to follow suit.
However, while the majority of the GCC population is Muslim, none of the top five halal cosmetics consumer markets (India, Indonesia, Russia, Malaysia and Turkey) are within the region, the report shows.
“There is currently an unmet demand in the market for halal products … not being met because there is no standardised global halal authority coupled with a lack of access to certifying bodies and education to what these certifying bodies actually do and offer,” said Collins.
Navigating the maze
She says initially the process appears daunting as there are multiple accreditation bodies. To be compliant, a brand must register with a listed halal certification partner.
“This is a serious partnership; one that must align with your practices and procedures. Once you work with one of these certification companies, (the accreditation process) is fairly straightforward provided you adhere to halal requirements,” said Collins.
These include using only permitted ingredients and working with a halal-approved supply chain and halal-approved assurance system that prevents ingredient cross-contamination during manufacture.
For Salma Chaudhry, founder of the now-inactive UK-based Halal Cosmetics Company, acquiring halal certification was a difficult undertaking when she established the business in 2013. Then halal certification bodies did not have a system for cosmetics.
“It was a long process working with our chosen certification body, ingredient suppliers, the manufacturing plant and the quality control consultant,” said Chaudry, who is currently exploring a new opportunity for a natural cosmetics line inspired by her Indian heritage.
Being guided by an experienced Muslim quality control consultant within the cosmetics industry helped. However, since the increase in popularity and awareness of halal cosmetics, new regulations have been tabled.
“In 2019 we were told if our products are to be sold in the GCC, we need to use an ESMA- (Emirates Authority for Standardisation and Metrology)-approved halal certification body. This was a costly process and created a challenge, not just financially, but also due to some of the new rules and regulations,” she said, indicating the halal certification process for cosmetics now is far more complex than in 2013.
The Halal Cosmetics Company was one of the first international halal-certified beauty brands and had entered the United Arab Emirates (UAE) in 2016, but Chaudry ceased operation in 2020 due to various reasons including Brexit-related barriers and family commitments.
Seeing the opportunity
However, despite the complexity and costs associated with cosmetics halal certification, global brands are increasingly choosing to certify their products to export to Muslim markets including the GCCs. Collins said typically the leadership was coming from the various brands in their respective countries and “they are thriving in their home markets”.
Her 16-year career includes building an international beauty distribution business in the Middle East, but acknowledged the globalisation of beauty allowed more brands to expand and the accessibility and demand for these brands to become halal certified was driving the category.
In the GCC, the halal cosmetics space has been dominated by foreign brands including Australia’s Inika, the UK’s PHB Ethical Beauty, India’s Iba Cosmetics and US-based 786 Cosmetics. Earlier this year Kolmar Korea announced it would supply its halal-certified cosmetics to the Middle East and North Africa.
The foray of global brands into the region is awakening local players and start-ups taking advantage of their market position by offering halal-certified products. One such brand is Dubai-based Shade M that launched a halal-certified lipstick collection in 2020 in the UK and the US.
In February 2021 the company entered the GCC through a partnership with Faces, a UAE-based beauty retail chain with an ecommerce platform and 85 stores across the region.
In May last year Cosmo Cosmetics, a subsidiary of the UAE-based Sterling Perfumes, launched an online store. Established in 2017, the company’s Dubai-based halal-certified production facility enables it to offer the most extensive range of affordable halal cosmetics in the region.
By September 2021 Dubai-based Mikyajy had introduced its first halal-certified make-up line. The brand was already halal-compliant, but took the long journey to certify its entire production process including its European manufactures.
“It was a massive strategic decision and we needed to ensure it was relevant in the market,” Jim Ragsdale, deputy CEO of Mikyajy said in an interview with online publication Professional Beauty.
Mikyajy also conducted in-house research and found its customers associate halal products with hygiene and purity.
“When we surveyed our Gulf customers, (their) responses made us realise halal is a kind of proxy for what customers elsewhere in the world are calling clean or sustainable,” said Ragsdale.
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Peace of mind
Mikyajy’s first experience with halal-certified products was its breathable nail enamel line that proved successful even during the pandemic. On this strength, the company expanded its presence in halal cosmetics.
Breathable nail polish is among the most popular products among Muslim women as the water-permeable formulation makes it wudhu (ablution) friendly. Yet, for nail polish to be halal, it must also be free of impermissible ingredients.
The first brand to introduce halal-certified nail polish in the Middle East was Dubai-based LYN (Love Your Nails) in 2015.
“Halal certification adds value in any country or region if you are targeting Muslim consumers as it provides peace of mind … It also gives freedom of choice when making a buying decision,” said Chaudry, adding without the halal label, consumers may feel they must research further.
While many vegan beauty brands claim to be halal-friendly, this does not guarantee they are halal-compliant as they may contain ethanol at a concentration higher than 1% and/or alcohol, both considered non-halal.
Hence, Collins believes it’s important to provide consumers with relevant certifications and, in the GCC, this is often halal. It was also important for companies to recognise Muslim consumers have personal likes, dislikes, care needs and challenges beyond their faith.
“Brands cannot define the Muslim consumer by an outsider’s representation of their faith. Halal certification is not usually the key driver in their purchasing decision with regards to cosmetics; it’s a starting point,” she concluded.
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