The beauty industry is once again recording stable growth this year: according to calculations by the German Cosmetic, Toiletry, Perfumery and Detergent Association (IKW), industry sales rose by 2.9 per cent to 35.6 billion euros. Domestic sales even grew by 5.5 per cent to €23.9 billion, while exports fell slightly. Overall, the industry has grown by an average of 4.4 per cent annually since 2020 and is proving to be crisis-proof in the weak economic situation. Products such as skin and hair care, toothpaste, cleaning agents and detergents are firmly anchored in people's everyday lives. "Beauty and household care provide structure and strengthen well-being and self-esteem, especially in uncertain times," said IKW Chairwoman Gabriele Hässig at the digital IKW economic press conference in early December.

Strong external impact, weak location

According to IKW figures, products for external appearance are growing the strongest. Skin and facial care products are up 11 per cent, hair care products 8 per cent. Cosmetics are most often purchased in drugstores, while online sales have grown to a 7 per cent share. However, in addition to high energy and personnel costs, the geopolitical situation is also having a negative impact on sales markets. A Roland Berger study commissioned by the IKW also shows that 90 per cent of companies see bureaucracy in Germany as a major burden, while 75 per cent consider the location to be unattractive. "The federal government must work at EU level to correct disproportionate burdens, allow ethanol as an ingredient and support simplifications in the Cosmetics Regulation," emphasises IKW Managing Director Thomas Keiser. The industry in Germany comprises more than 1,000 small and medium-sized companies and around 60 large companies, providing around 178,000 jobs. They are driving important innovations, for example in vegan formulations, resource-saving recipes and recyclable packaging solutions.

Emotion instead of a sense of duty

A study conducted by market research company YouGov on behalf of the IKW showed that more and more people feel they receive too little recognition. At the same time, environmental awareness is declining, with more and more respondents saying they do not want to feel guilty about their consumption habits. According to YouGov, this means that brands need to focus more on emotional connections. "Brands need to re-sensitise reified relationships and make the brand resonate," emphasised Senior Insights Director Robert Kecskes at the digital IKW economic press conference. Examples such as the cooperation between dm and Sheglam showed how great people's longing for new experiences is. The trends towards lifestyle and sustainability in personal care and cosmetics also continued to grow. The perceived loss of self-efficacy intensifies the pursuit of self-optimisation and health. According to Kecskes, the future does not lie in a backward-looking romanticisation of the old days, but in a forward-looking vision of the future.

Source: IKW