Cosmetic Oil Market Trends

Growth Drivers

• DIY trend: The Do-it-Yourself (DIY) trend is driving interest among consumers in personalized skincare routines. To customize their beauty oils, consumers often buy multiple carrier oils, creating a profitable opportunity for manufacturers. Furthermore, considering the rising popularity of DIY beauty oil formulations, manufacturers are producing and commercializing cosmetic oils in small-volume batches.
  
  For instance, in January 2024, Evonik Industries AG introduced a sustainable baobab oil for natural cosmetic formulations, certified by the FairWild Foundation. The oil is sourced from Sahel, Ghana, and is commercialized under the Ecohance name. This oil is used to make cosmetic formulations such as hair conditioners and body creams. In cooperation with the United Nations Convention to Combat Desertification (UNCCD), the company supports the Great Green Wall Initiative that ensures the sustainability of baobab oil.
• Collaborations with spa and wellness centers: The wellness and spa centers being major consumers of cosmetic oils are consistent sources of revenue growth for key players. To create high brand exposure, cosmetic oil manufacturers are collaborating with spa service providers. This move is boosting the oil application in professional treatments such as facial, massage, and hair treatments. For instance, the global spa services market was valued at USD 147 billion in 2023 and is estimated to grow over 65.0% by 2032. The swiftly increasing spa services such as massages, beauty treatment, grooming, and fitness are set to significantly augment cosmetic oil sales in the coming years.

Challenges

• High prices of premium cosmetic oils: Premium quality cosmetic oils such as argan, almond, olive, and marula are often associated with high prices owing to their superior purity. The extraction process of premium cosmetic oils is complex and labor intensive, which drives up its sellable costs. These factors majorly limit premium cosmetic oil sales in price-sensitive markets or among budget-conscious consumers.
• Lab-made alternatives driving competition: The chemically produced cosmetic oils majorly challenge the sales of organic or natural counterparts.  The lab-made alternatives perfectly mimic the benefits of natural oil, creating a competitive environment. Also, these alternatives are cost-effective and easily available, which hampers the growth of the cosmetic oil market.