‘Up close and green’ – a trend gathers momentum

With increased media activity and consumer awareness, the term “green” is being used in numerous scenarios and as a result there are many different definitions of green. Translation and interpretation of the meaning of green can depend on many factors, including the industry in question and the consumer’s social and environmental awareness. The personal care sector is one market in which green is still in its infancy but is by no means insignificant – the global natural and organic market is growing at a staggering 15% to 17% per annum, according to the research company Organic Monitor. The global natural and organic market was valued at US$6.9 billion in 2007, with North America and Western Europe, accounting for a significant 65% and 28% respectively. In contrast, Asia Pacific, with a 3% market share is much less developed. Even in the regions where the green trend is booming, there still is some confusion surrounding what constitutes green. Natural and organic content are the obvious measurable parameters, but claims made on these content aspects are not regulated and are, from a purist’s point of view, sometimes subject to misuse. In Europe, the trend also extends to claims such as “free from petrochemicals”, “preservative free”, “locally produced”, “fair trade”, “not tested on animals”, “biodegradable formula” and “carbon neutral”, to name just a few. GNPD Mintel data indicates that one in seven products launched into the European market last year marketed at least one of these green claims, a significant increase from the one in ten products reported in the previous year. Within the Asia Pacific region the focus and approach to the green market is quite diverse. Australia and New Zealand appear to have the majority share with home-grown brands such as Gaia Skin Naturals, Natures Organic and the Eco Store brand. The last named was awarded the Green Ribbon Award by the NZ Ministry for the Environment in 2002. In Asian countries, natural and organic claims are less prominent, as they tackle the green trend with the use of traditional natural ingredients, cold processing and recyclable/refillable packaging. With many Asian countries having a strong heritage in natural ingredients, often founded in ancient medical practices such as Ayurveda, these products have typically been associated with the lower end of the market. Organic Monitor, however, points out that the demand for natural and organic cosmetics is growing in the Asian market, with some domestic brands keen to make a name in the naturals arena. This is especially true for the more affluent countries such as Japan and South Korea. A South Korean company, The Face Shop, has launched the Eco Vert brand, a line of natural skincare products with ECOCERT approval. Despite this, it is the European and North American brands such as Dr Hauschka and Aveda which are currently taking advantage of the developing market trend, with smaller brands such as Neal’s Yard Remedies also keen market players.

Validating green claims
With so many different claims being made, it is hard for consumers to know what to look for in order to ensure they are not being “green washed”. “Green washing” is one of the latest buzz phrases being used by the industry and media to describe how some green claims may be dishonest or misleading to the consumer. There are “Six Sins” associated with green washing:1

- The hidden trade-off (emphasising just one environmental improvement, while possibly compromising on others.
- No proof (no official documentation to support claims).
- Vagueness (claims insufficiently clear. For example, nothing is ever “chemical-free”).
- Irrelevance (claims are not relevant. For example, “CFC-free” – this is a requirement not a claim).
- Fibbing (claims are simply untrue).
- The lesser of two evils (where a greener alternative is not necessarily better – for example, organic cigarettes).

“Green washing” is a growing concern throughout all industries and not without reason. A recent study showed that around 70% to 80% of North American and 23% to 30% of Asian products to be marketed in this way.2 Europe appears to be leading the way, with a proliferation of certification bodies, including both private and not-for-profit organisations, exercising their own definitions and standards for natural and organic cosmetics. This landscape, however, is about to improve slightly with the European harmonisation of six current certification bodies, the Soil Association (UK), ECOCERT (France), BDIH (Germany), AIAB/ICEA (Italy), BioForum (Belgium) and Cosmebio (France). These organisations are due to launch their harmonised standards called “COSMOS Natural and Organic Cosmetic Standards” in April 2009 and while they go some way to tackle the overcrowding of certifications, it will not completely eradicate the confusion. Other certifications within Europe will both co-exist and compete with the COSMOS standard, including the newly launched NaTrue label, established by a European interest group consisting of natural and organic cosmetics manufacturers. NaTrue is aiming for a truly global standard with complete transparency and offers a three star approach, dependent on whether the product is made from natural, natural with organic or organic ingredients. A third group of certification bodies also exists in Europe. These are referred to as Eco-label organisations, and two examples of Eco-labels are the Nordic Swan and the EU Flower. The Eco-labels focus more heavily on detergent systems and their environmental impact, as they aim to reduce water pollution, minimise waste and prevent potential risks to the environment. Some regions are expected to look to Europe for guidance on certification and eagerly anticipate the European harmonised COSMOS standards, especially as many other regions, including North America and the Asia Pacific, have a growing number of certifications and accreditations of their own. North America has a number of certifications for natural and organic cosmetics, including OASIS, and the USDA Organic and Natural Products Association. Asia Pacific has the National Association for Sustainable Agriculture Australia (NASAA) and several Eco-label initiatives including the Korean Eco-labelling programme which aims to reduce consumption of energy and resources and to minimise generation of pollution substances in each production step. With so many different standards to choose between, key personal care ingredient suppliers and manufacturers of finished goods may have a significant influence on the success or failure of these standards. So far, the reactions of ingredient suppliers and cosmetic manufacturers have been mixed, especially in Europe with some manufacturers developing their own values and criteria for green and others holding off for the European harmonisation launch. Ingredient suppliers, too, react in different ways – again some have developed their own rating scales, while others, such as Croda, have chosen not to go down the numerous certification routes but instead provide valuable ingredient information within their green guide to support their customers’ individual needs. As for consumers, there is still a risk of over complicating matters, with so many different logos to distinguish between. Only time will tell if these certifications will impact on the longevity of the trend or whether there are other green values of more importance.

 Wider green landscape
While natural and organic claims are prevalent in North America and Europe, other green parameters have a greater focus within Asia. Many Asian manufactures consider going green to be an energy-saving or waste-saving exercise – this is more in line with the “12 Principles of Green Chemistry”3 (Table 1). When it comes to reducing energy input and processing costs, cold processable ingredients can often provide a greener solution. For manufacturers looking to make savings in every aspect of the product life cycle, there is an option to use cold processable ingredients, eliminating the need for high temperatures and unnecessary energy costs. These ingredients can range from emulsifiers such as Arlatone V-175 and cold mix emulsion systems such as MixXIN ME through to inorganic sunscreens such as the Solaveil Clarus range. Efforts are also being put behind new carbon labelling systems, both in the UK and in many Asian countries. Carbon footprint labels have been under development for many years in the UK, with the Carbon Trust piloting a scheme involving a number of different products from several industry sectors. In the personal care sector, Boots’ Botanics shampoo range was one of the first to be in a pilot scheme trial. Looking at the complete product life cycle, Boots was able to reduce its carbon footprint, most significantly in the distribution and packaging areas, giving its Botanics shampoos an overall reduction of 20%, in 2006. Following this pilot scheme, and at the request of the project sponsors, the Carbon Trust and the Department for Environment Food and Rural Affairs (DEFRA), The British Standards Institution (BSI) has developed a carbon footprint standard, PAS 2050. Such a standard will now hopefully make carbon footprint reductions more comparable and meaningful to the consumer. Other countries have also entered into this territory, with the director of Thailand’s Greenhouse Gas Management Organisation (TGO), Sirithan Pairojboriboon, announcing new carbon labels for products, detailing the percentage of CO2 reduction achieved. The reduction will be determined by a committee of experts who will calculate the CO2 levels by taking into account the raw materials, processing methods and the product’s shelf life. Japan, too has announced its plans for a government approved CO2 calculation and labelling system. The system, which is due to be launched in the spring, aims to reveal the CO2 factor for various products, including food, detergents and electrical appliances. 

Consumer segmentation
Like many market trends, the green trend will no doubt have its good days and bad days and it is therefore important to try and understand who the green consumers are and are not, in order to foresee the longevity of the trend. Many marketing research companies in North America have invested time in trying to understand the various consumer groups. The Natural Marketing Institute (NMI) has identified five classes of consumers in North America, the LOHAS, which stands for Lifestyles of Health and Sustainability, account for 19% of the mix. They are driven by issues surrounding their health and environment and play a big role in sustaining the trend. Naturalists (19%) are thought to be driven by personal health, more than the environment and similar to the LOHAS they are avid users of green products. The largest segment is that of the Drifters (25%), who are driven by the latest trends and, more worryingly, are most sensitive to price and issues in the media. The fourth group are the Conventionals (19%) who are driven by practicality and may partake in some green issues, such as recycling and energy conservation. Finally the Unconcerned (17%) – while they are not currently driven by green issues, these consumers may be targeted as products go into more mainstream retailers. As issues in the media and economic pressures take hold, it will be the Drifters and the Unconcerned that will threaten the longevity of the green trend. As well as the strong health and environmental values held by the LOHAS, the study also showed them to value efficacy of products very highly, demonstrating that applications and/or clinical evidence is still very much key to a product’s success. This may go some way to explain why natural deodorants and sunscreens have not taken off as fast as products in other personal care sectors

Global ethical values
Many consumers who are keen to embrace the trend towards natural and organic cosmetics also identify with socially ethical brands. The most obvious choices are those supporting local production, fair trade ingredients or community trade projects. Locally produced products are considered green for their transportation savings and ethical for their support of the local economy. Fair trade goods are perceived to be more sustainable for developing economies. It will be interesting to see how consumers balance the environmental, social and sustainability issues associated with the conflict between locally produced and fair trade. Further certifications and accreditations may play a role, such as the Forest Stewardship Council (FSC) and more initiatives like the Roundtable on Sustainable Palm Oil (RSPO) may become a stronger focus for the consumer in the future.

Conclusion
Despite some confusion arising from all the different accreditations and certifications, the personal care industry seems united in the belief that the green trend will continue. In regions where the trend is already well established, such as North America and Europe, double digit growth is predicted for the next five years and the green claims are expected to become more regulated and sophisticated. In the Asia Pacific region, growth is likely to be led by Australia, New Zealand, South Korea, Malaysia, Hong Kong, Japan, Taiwan and Singapore, although other countries such India and China, which have seen strong economic growth and recent health scares such as those over chromium and neodymium contamination, are likely to see a significant impact on green consumer demands. Also, as imported green brands grow within Asia, and locally manufactured products increase awareness and confidence, the green trend looks set to prosper.

References
1 The Six Sins of Green Washing, Terra Choice Environmental Marketing. www.terrachoice.com/ 2 More companies claiming false green initiatives, Countries & Consumer, Euromonitor, July 2008. 3 Anastas P.T., Warner J.C. Green Chemistry Theory and Practice. Oxford University Press, 1998.