According to U.S. market research and consultancy firm Grand View Research, by 2020 the global market for organic personal care products is expected to exceed US 15.98 billion, equating to an annual growth of 8-10%.

The growth of organic and natural healthcare products is fueled by several factors, among them the emergence of ecommerce stores catering to the demand for specialty chemical-free products, which are hard to find in pharmacies or other health and beauty product stores.

New products are also being constantly developed for the organic and natural health market and data suggests the spending capacity on premium organic personal care products is rising.

Global Organic Personal Care Market: High Demand Sectors

Skincare products are the highest organic personal care products in demand, and are the most attractive segment for retailers. The expected market share in this category is expected to rise to 30.9% by 2024. Haircare is the next most popular segment.

Market projections indicate that organic skincare products will command close to a third of the global organic personal care market.

The growth of organic skincare products is primarily driven by an increasing number of health conscious consumers who are turning their backs on chemical-laden products. There’s also a growing preference among consumers for purchasing organic personal care products online and the growth in online transactions is expected to surge in the near future.

The Growth of Online Stores

The distribution channels for organic beauty products comprises supermarkets, pharmacy stores, specialty retailers, direct sales and online retail stores.

While the supermarket market segment was projected to account for 28.4% of sales during 2016, online retail is now one of the fastest growing segments, and was valued at approximately USD  1,979.3  in 2016.

Online retail channels are seen as a lucrative opportunity for companies seeking to expand their reach and penetrate markets which were otherwise not cost effective to reach. As a result, they are able to expand their customer base faster and generate repeat business.

The convenience of shopping at any time without being stuck in traffic or waiting in line at a checkout counter are important reasons why more consumers are moving online. The stores never close and customers can make a purchase even if it’s a public holiday. Further, with payment gateways becoming more secure, consumers have become increasingly confident to pay for their purchases online.

A fast-growing trend online is the growth of subscription services, which generate a consistent income for online retailers without expensive advertising. It is estimated that about 40% of consumers in the U.S. who purchase healthcare products have signed up for one or more subscription services.

Online subscription services provide consumers the time-saving benefits of products used regularly to be delivered to their homes without making frequent trips to a store or going online every time they want to make a purchase.

The Price Dynamics of Online Shopping

Online and in-store shopping behavior is completely different in that consumers can spend considerable time researching price online. Consumers are however unlikely to drive from shop to shop to compare prices in retail outlets. The geographic distance, energy, cost and the risk of finding a deal that’s more expensive don’t make the effort worthwhile.

Manufacturers and distributors of organic healthcare products online do not have the burden of rental and overhead costs such as staff salaries and other expenses required to run the business.

As a result, online health and beauty stores are able to offer products at prices which are difficult to match by in-store retailers. In addition, they can also offer better discounts and special deals to their customers.

Online portals also make it easy to use dynamic pricing where the price of an item can be changed in real time based on market demand. Using specific algorithms, information such as how many times a product has been viewed and the time it was viewed can be determined. The price can then automatically be raised or lowered so it is in alignment with customer demand.

Levelling the Playing Field in the Competitive Natural Healthcare Market

Online retailing has brought a new dynamic into selling and marketing of natural healthcare products online. It allows lesser known brands the opportunity to quickly gain a high level of exposure at a relatively low cost.

More importantly, customers are introduced to new products they never even knew existed. They may have been searching for organic healthcare alternatives to the mainstream products they may have been using for years.

For instance Black Chicken Remedies is a brand which is gaining a huge fan following. Their range of natural healthcare products includes aluminium-free deodorants, body oils and balms.

Warpaint, is an innovative teeth whitening product which contains 100% natural ingredients to strengthen, whiten and polish teeth. In addition it strengthens the enamel and detoxifies the mouth.

Kosmea, is an international success story, offering a range of innovative skincare products made from Certified Organic Rosehip Oil and is suitable for all ages. The Australian Company regularly adds to their range of natural products within everyone’s reach.

Eco Tan is a company which prides itself on authenticity and transparency. Their range of tanning and Body Care products are Certified as Organic by the Organic Food Chain Australia.

These are just a few of the organic health and beauty brands which are making serious inroads into the market through established online stores such as Love Thyself.

Improved Speed to Market

Retail stores are at a huge disadvantage when it comes to reach customers with new products which are in high demand. The supply chain for major retailers is not structured to respond quickly enough to source, package, stock and market new brand extensions.

On the other hand, online retailers such as Love Thyself typically have four or five suppliers and are able to quickly source in-demand products and begin to sell them on their online store in a matter of days.

The faster an online store’s is able to bring new products to the market, the greater likelihood they will have for dominating it, simply by giving themselves the benefit of a first mover advantage.

On the other hand, retailers who aren’t able to move quickly tend to develop the reputation of a follower, instead of an industry leader.

The first E-Commerce Performance Indicators and Confidence (EPIC) report published by SLI Systems indicates that 80% of online retailers from countries all over the world have forecasted revenue increases in the first quarter of 2017.

It’s been said that retailers who are able to deliver better products faster and cheaper than their competitors will emerge as clear winners.

While it’s difficult for retailers online or offline to meet all three criteria at the same time, online health and beauty stores, including retailers of health products in Australia, have a distinct advantage in catering to the customer’s needs. Just like an elastic band, which can never return to its original state once stretched, eCommerce has created inroads into product distribution in the natural healthcare market, including Australia’s health products sector, and there’s no looking back.