Australia cosmetics market is projected to reach USD 12.93 billion by 2030 from USD 8.15 billion in 2022 growing at a CAGR of 5.94% for the forecast period between 2023 and 2030. The Australian cosmetics market is experiencing robust growth due to high personal disposable income and high standards of living which results in high demand for premium quality products and easy adoption of new cosmetic product that enters the Australian market. High consumption and cosmopolitan population growth make Australia a target market for several cosmetic manufacturers.
Another key factor boosting the cosmetics sector in Australia is a continuous change in consumer preference and rising demand for sustainable products. Furthermore, Australia is known for fashion, which helps to fuel the need for colour cosmetics. Highly developed infrastructure and digitalization make it simple for Australians to acquire cosmetics from any store in the retail market or through an online channel while relaxing at home or working at an office. Due to a large percentage of the wealthy population in the country and the great demand for beauty goods, a range of international products compete to enter the market.
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Growing Interest Toward Sustainable and Ethical Beauty
Cosmetics companies spend a lot of money on R&D to produce new concepts, products, formulations, and textures as well as impressive packaging. The demand for organic and chemical-free products is increasing as consumers become more aware of the materials used to make cosmetics. The Australian customer wants brands that utilize non-toxic, non-cruelty, and palm oil-free products as well as ethical sourcing, sustainable packaging, and efficient waste management techniques. Australians want to buy sustainable and ethical goods, and customers want firms to be more open with their marketing. To meet this need, businesses are developing products that fulfil these preferences while also attempting to attract new customers. Environmental and Earth conservation awareness is driving companies to repackage their goods in more enticing and environmentally friendly materials.
Sukin is a Melbourne-based skincare company that uses formulations that are 100% carbon neutral, biodegradable and greywater-safe. To restore eroding land and coastal wetlands, they collaborated with Greening Australia on the Reef Aid Programme.
Skin Minimalism is shaping Australian Skincare
In Australia, there are more sunny days than cloudy ones, thus people are choosing skin care products with sun protection. Living in a bright nation like Australia, consumers need to pay attention to their UV exposure and follow a skincare regime that is suited to their skin type. The skin minimalism approach is about making minimal effort to achieve healthy, bright skin. In everyday skincare practice, consumers want to utilise the fewest possible skincare products rather than using multiple products like oils, creams and serums and yet achieve beautiful skin. Different kinds of products are used to follow this approach and moreover, this approach is more environment friendly and saves both time and money.
Government Regulations
Australian government policies regarding the import or manufacture of cosmetics set the standard for a product to be high-quality and at the same time these policies are business friendly which encourages more players to enter the market. Australian Government evaluates the hazards connected with cosmetic items and/or materials produced or imported into the nation in order to guarantee the safety of customers, workers, and the environment. Formulas for cosmetics will be made from the ingredients list that is listed by AICIS (Australian Industrial Chemicals Introduction Scheme). Ingredients that are not listed in the inventory cannot make up more than 1% of the final product and must nevertheless adhere to several ecotoxicological standards. In the latter scenario, a complete report must be presented for the AICIS to evaluate the substance. The Consumer Goods (Cosmetics) Information Standard 2020, regulates labelling any cosmetics that are imported or manufactured in Australia (and intended for use in the country).
Inclusivity and Diversity
The beauty and skincare industries now place a high priority on inclusivity and diversity. To better accommodate a wider range of skin tones, brands are broadening their colour selections. In their marketing initiatives, they use models and influencers from various backgrounds. This makes it possible for people of various ethnies and skin tones to select goods that complement their complexion. Several brands are also working towards gender-neutral skincare products. Inclusion and diversity in the skincare sector go beyond marketing and inclusion rather create products and experiences that meet the requirements of a broad spectrum of customers. Brands are promoting a more appealing and inviting skincare community by embracing inclusivity and diversity.
Adore Beauty, an Australian online beauty retailer, launched its “The Global Shades” programme, a first step in a long-term diversity and inclusion campaign to improve the firm from the inside out. The programme is modelled to fill in product gaps, particularly the absence of appropriate make-up tones and colours for people.
Online Segment Grows at a Faster Pace
The cosmetics market of Australia has witnessed a change as a result of the growth of e-commerce platforms and online shopping which gives customers the ability to compare prices, access a variety of products, and have items delivered right to their doorstep. The pandemic only fastened the cosmetics industry’s transition towards digitalization, leading to a considerable shift toward online sales and e-commerce. With customers increasingly turning to online platforms for their skincare and cosmetic requirements, this trend is predicted to continue. With E-commerce and D2C platforms benefit brands by using data analytics and technology to provide consumers with personalised experiences. E-commerce has created opportunities in the cosmetics sector for both well-known companies and up-and-coming players.
Australians spent USD 49 billion on e-commerce in 2021, up from USD 38 billion in 2020. According to Australia Post’s “2022 eCommerce Industry Report”, 9.2 million people or four out of five Australian homes completed online transactions in 2021. Over 19% of all retail sales are now conducted online. Health and beauty stores account for 8.9% of all online retail sales and a 2.4% YoY growth.
Impact of COVID-19 on Australia Cosmetics Market
COVID-19 shaped the Australia cosmetics industry in many ways, initially when covid hit the country overall sales for cosmetics dipped and revenues inflows for businesses kept low throughout 2021. However, once the economy rebounded it showed a variety of trends and shifts in customer preferences. Online sales increased because of the closure of physical retail stores and limitations on in-person shopping. During times of shutdown, e-commerce platforms and internet stores were crucial distribution avenues for cosmetics businesses. The cosmetics market has been more digitalized as a result of people increasingly buying online for their skincare and cosmetic needs. There has been a trend in consumer preferences towards a more natural and minimalistic makeup look as a result of remote work and fewer social engagements.
Report Scope
“Australia Cosmetics Market Assessment, Opportunities, and Forecast, 2016-2030F”, is a comprehensive report by Markets and Data, providing in-depth analysis and assessment of the current scenario of the cosmetics market in Australia, industry dynamics and challenges. The report includes market size, segmental shares, growth trends, COVID-19 impact, opportunities, and forecasts (2023-2030). Additionally, the report profiles the leading players in the industry mentioning their respective market share, business model, competitive intelligence, etc.