Notes from China

Nutricosmetics More Than a Niche in China

While remaining a nascent category in much of the world, nutricosmetics have been better accepted in Asia, especially China. In comparison to their western counterparts who are still skeptical about the viable benefits of this type of products, Asian consumers have been buying into the beauty-from-within concept and are quick on the uptake of nutricosmetics.

According to Frost & Sullivan, Asia is estimated to account for about half the world’s total nutricosmetics sales with $1.33 billion, and while Japan represents the largest nutricosmetics market in terms of sales, China is expected to grow strongly during the period 2011 to 2015 and overtake it by 2015. A report from Datamonitor also shows that for per capita spending, Asia is clearly the largest region, with Japan way ahead of the rest with almost $19, followed by South Korea and Hong Kong with approximately $7.

Apart from rising disposable incomes and increasing beauty concerns, cultural acceptance of the beauty-from-within concept is a major driver for strong growth in China’s nutricosmetics market. These messages of inner beauty are simple to convey to Chinese consumers and easy for them to understand, as this classical approach can be traced back to ancient times when various natural foods were used to cure numerous beauty related problems, such as green bean used for treating acne, pearl barley for pigmentation, and white fungus (Tremella fucitormis) to hydrate the skin, to name a few.

Common GroundAnd Differences

Despite lack of clear legal definition, nutricosmetics are widely recognized as products that when ingested have an effect (preventive or reactive) on appearance. As the concept becomes more popular in China, nutricosmetics present growth opportunities to both established companies and new entrants. By simultaneously addressing the consumer need for nutrition and appearance enhancement, the beauty-from-within category growth remains impressive, and more products are hitting the shelves.

Almost the same as the other markets, Chinese nutricosmetics manufacturers are primarily from the food or cosmetic industry, and their products take the form of either food/beverage product or dietary supplement, mainly targeting people with relatively high levels of disposable income, especially young women. Most of these products tend to focus more on specific parts of the body, including the skin, hair and nails, rather than making generalized beauty-from-within claims.

Common ingredients in today’s Chinese nutricosmetics include collagen, minerals, vitamins, polyunsaturated fatty acids (PUFA) and prebiotics/probiotics as well as fruit/vegetable extracts claiming to nourish the skin, nails and hair. These ingredients go into different product applications, with the greatest focus on weight management, skin complexion/texture improvement, moisturizing, anti-oxidation and anti-aging, followed by UV filtering and hair growth.

With a rapid increase in the number of aging people in urban areas, products offering anti-aging and hair-loss-controlling properties are expected to benefit most from this demographic change.

Entrepreneur Expansion

In China, the idea of capitalizing on modern nutraceutical trends with advanced active ingredients, such as collagen and vitamins, arose in the 1990s, when Imedeen entered China in 1997 with its collagen-based dietary supplement. The company went on be very successful, and ever since then, beauty-from-within products featuring collagen, along with vitamins and minerals, have been dominating Chinese nutricosmetic sales.

Herbal and fruit extracts are also gaining popularity in nutricosmetics as Chinese consumers are shifting toward natural-based products due to concerns over safety of synthetic ingredients. And with those products positioned as natural, which are highly favored by consumers, we are now seeing an increasing utilization of traditional food ingredients by nutricosmetics manufacturers.

One of latest examples is Brands’ InnerShine Berry drink from a Singapore-based nutraceutical company. Featuring the extracts of four berries, blueberry, blackcurrant, cranberry and açai berry, it claims that these natural ingredients will help the body detox from within, to promote outer radiance complexion and body contour by taking a bottle every day and night.

Another good example of better utilization of traditional food ingredients is Hanbo Red Date Powder drink, which comes from a local food company specializing in red date processing. Thanks to red date’s well-known reputation of nourishing blood and improving skin’s complexion in China, this latest launch targeting young women has gained immediate success in the market within a few months.

Exploring this less competitive, highly potential market is also the thinking behind some traditional cosmetic manufacturers’ decision to launch nutricosmetics. Apart from their topical products, quite a few traditional cosmetics companies are expanding the integration of product lines. To complement its topical products, Herborist, one of leading local brands, has launched a series of herbal tea products claiming to help maintain the balance of internal body and therefore promote the integral health of skin and hair. Innéov, the joint venture of L’Oréal and Nestlé, is also reportedly entering Chinathis year with the beauty pills.

Barriers to Growth

Although there is no shortage of consumer awareness and less skepticism about nutricosmetics’ benefits in China, a lack of regulatory guidance on formulation and benefit claims has been a barrier to growth. Like the rest of the world, there is no clear regulation for production, promotion and categorization of nutricosmetics in China. In fact, the overall China nutraceutical market has not been strictly regulated so far.

This is, however, about to change due to numerous safety and false advertising scandals in China in recent years. Regulation on Supervision and Administration of Functional (Health) Foods proposed by the State Council is currently under review and widely believed to be passed and introduced at the end of this year.

Under this new regulation, all aspects of nutraceutical products are strictly stated, from product approval, manufacturing/marketing to function claims, and beauty-related function claims have been restricted to only two, “anti-oxidation” and “helping promote facial skin health.” The latter is the generalization of “anti-acne” and “anti-pigmentation” claims allowed in the previously proposed regulation. Other previously approved claims on nutricosmetics, such as “retaining skin moisture” and “regulating skin oil,” will be banned in China.

The new regulation is expected to have a tangible impact on the dynamics of China’s nutricosmetics market. On the one hand, as difficulties still remain in innovating an edible cosmetic that has good taste, product benefits and stability, some industry insiders are worried that the regulation may restrain the future development of nutricosmetics in China. On the other hand, since nutricosmetics are nothing new to most of Chinese consumers, the new regulation can help products build consumer trust through official accreditation.

Ally Dai

Happi China

Ally Dai is senior editor of Happi China. She has more than 10 years of experience in the cosmetic and food industries. Happi China is a leading media for the China household & personal care industry. Published by Ringier Trade Media in strategic editorial partnership with Happi, it helps local manufacturers update their knowledge on formulating, testing and packaging, as well as providing market insight.

Website: www. industrysourcing.com