Essential Oil Soap Market Size, Share & Trends Analysis Report By Product Type (Lavender Essential Oil, Rose Essential Oil, Tea Tree Essential Oil, Rosemary Essential Oil, Peppermint Essential Oil, Others), By Distribution Channel (Supermarket/Hypermarket, E-commerce, Retail Stores, Pharmaceutical Stores) and By Region(North America, Europe, APAC, Middle East and Africa, LATAM) Forecasts, 2023-2031

Market Overview

The global essential oil soap market size was valued at USD 0.339 billion in 2022. It is estimated to reach USD 0.660 billion by 2031, growing at a CAGR of 7.7% during the forecast period (2023–2031). Essential oil soaps have gained high popularity among consumers globally due to their unique healing benefits, aroma, and relaxation they provide upon application and the perception among consumers that natural ingredients are better and safer than synthetic alternatives.

Essential oil soap is a type of soap that is infused with natural essential oils derived from plants. It combines the cleansing properties of soap with the aromatic and therapeutic benefits of essential oils. Essential oils are highly concentrated plant extracts known for their distinct fragrances and potential health benefits. Soap makers incorporate essential oils into the soap mixture during manufacturing to create essential oil soap. The essential oils are carefully chosen for their specific properties and scents, ranging from soothing and relaxing to invigorating and refreshing. Some well-liked essential oils utilized in the production of soap include lavender, tea tree, eucalyptus, peppermint, citrus oils, and many more.

The addition of essential oils to soap not only enhances its fragrance but also imparts various benefits to the skin. Essential oils have different properties that nourish, moisturize, soothe, or rejuvenate the skin. For example, lavender essential oil is often used in soaps for its calming and relaxing effects. In contrast, tea tree essential oil is known for its antibacterial properties and is commonly used in acne-fighting soaps. Essential oil soap can provide a luxurious and aromatic bathing experience. The natural fragrances of the essential oils can create a pleasant and therapeutic ambiance during showering or bathing. Additionally, some people find essential oil soap a more natural and gentler alternative to commercially produced soaps that may contain synthetic fragrances and harsh chemicals.

Market Dynamics

Global essential oil soap market drivers:

Rising awareness about the healing benefits of essential oils

According to the ancient science of Ayurveda, essential oils play a significant role in rebalancing the body systems. Every plant used to extract essential oils offers unique healing benefits. The scientific community has increasingly explored using essential oil soaps to resolve various skin concerns. In addition, they comprise properties that provide aroma and relaxation upon application. For instance, tea tree essential oil soap helps to combat acne, body odor, and fungal infections.

Likewise, rose essential oil soap helps to cleanse, purify, and tone the skin. Consumers today have become increasingly aware of the health benefits of using plant extract products. Hence, essential oil soaps have gained high popularity among consumers globally due to their healing benefits.

Growing preference toward sustainable and safe personal care products

Major personal care brands are progressively using essential oils in their products. Innovations and new formulations in the personal care industry are primarily driven by the willingness of consumers to pay more for natural skincare products. Consumers have gradually become aware of and seek skincare products manufactured without harmful and toxic ingredients.

In addition, sustainable products are gaining traction among consumers who want to know the source of their personal care products. In large, developed economies with high disposable income, such as the European region, there is a high demand for personal care products manufactured using natural ingredients. Furthermore, there is a rise in the perception among consumers that natural ingredients are better and safer as compared to synthetic alternatives in skincare products.

Global essential oil soap market restraints:

High price as compared to synthetic ingredient soaps

There are several reasons why essential oil-based soaps are priced higher than synthetic ingredient-based soaps. Owing to their elevated demand, the raw materials required to produce essential oils are costly. Essential oils require many raw materials to produce just a single drop. For instance, to produce a 15ml bottle of pure lavender oil, manufacturers require around 1.5 kg of lavender flowers. Likewise, it takes thousands of jasmine petals to produce a very minute quantity of essential oil.

In addition, the best quality essential oils require special harvesting techniques and a skilled workforce, as the extraction process is highly sophisticated. The product's final quality depends considerably on the extraction process and technique. Hence, these factors impact the end product's price, making essential oil soaps more expensive than synthetic ingredient soap. To mitigate the restraint of high prices, manufacturers can explore strategies such as optimizing their production processes, sourcing essential oils from cost-effective suppliers, or offering smaller-sized or value-pack options. Effective marketing and education about the value and benefits of essential oil soaps can also help create awareness and justify the higher price point to target consumers.

Global essential oil soap market opportunities:

Growth in revenue through online sales channels

The awareness of the health benefits of essential oil products has gained rapid recognition among consumers worldwide. However, the production and availability of these products is limited to certain countries. Conversely, the growth of internet penetration and easy accessibility offered by online platforms are expected to contribute to the obtainability of the product worldwide.

Therefore, introducing and selling essential oil soaps through online channels will further enable manufacturers to expand the market base and help boost the sales of essential oil soaps. Furthermore, online platforms allow targeted marketing and personalized recommendations based on consumer preferences and previous purchase history. This targeted approach can effectively engage potential customers interested in natural and organic personal care products, such as essential oil soaps.

Regional Analysis

Based on region, the global essential oil soap market is bifurcated into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa.

North america dominates the global market

North America is the most significant global essential oil soap market shareholder and is estimated to grow at a CAGR of 6.2% over the forecast period. North American study is focused primarily on the U.S., Canada, and Mexico, as these are the major countries contributing to the economy of this region. Including natural/organic ingredients in cosmetics and personal care products was the key success factor responsible for the revenue growth of new entrants and established players in North America.

Additionally, consumers actively seek more advanced, user-friendly, cost-effective skincare products and rely more on using natural ingredients in their cosmetic products. Natural essential oil is a key ingredient in many personal care products, such as soap, powder, shampoo, etc. Herbal and plant essential oils have a huge demand in the market. However, changing climatic conditions and substandard quality of products/ingredients from herbs and plants have helped minimize North America's demand-supply gap in essential oil products. This boosts market growth.

Europe is anticipated to exhibit a CAGR of 6% over the forecast period. The European market study focuses primarily on the UK, Germany, France, Italy, and Spain. These countries, being the developed countries in the region, have some of the highest GDPs in the world and are leading the European market in strengthening the European economy. The desire for natural ingredients has increased in Europe's cosmetics and personal care industries. Synthetic ingredients in personal care products often lead to lung diseases, skin allergies, respiratory problems, and brain disorders.

In addition, European manufacturers now opt for more natural and user-friendly ingredients like essential oils to overcome such hurdles. Essential oils are widely used in manufacturing daily-use cosmetics and personal care products and are forecasted to acquire traction due to increasing expenditure on cosmetics and toiletries. The rising spending on user-friendly cosmetic ingredients, like essential oil, is expected to drive Europe's overall essential oil market growth.

In Asia-Pacific, Rapid growth in e-commerce distribution is the prime factor for boosting essential oil soaps' growth. The cosmetic and personal care industry found a new platform through an e-commerce segment that allows consumers to purchase products through online sales channels. Moreover, the essential oil soap market is dominated by local players offering products through traditional retail packaging. Using traditional retail packaging materials increases the probability of counterfeiting during transit, as their packaging materials are easy to mimic. These factors are beneficial for the Asia-Pacific essential oil soap market.

In LAMEA, the Cosmetic industry is mainly influenced by SMEs operating in the regional market. These SMEs offer their products to geographies through online distribution channels or mail-order sales. Leading players in the market are also targeting the direct distribution of their products through authorized outlets and online portals. These players promote and supply their unique product offerings through direct sales. These factors boost the demand for essential oil soaps in the LAMEA region.

Segmental Analysis

The global essential oil soap market is bifurcated into product types and distribution channels.

Based on product type, the global essential oil soap market is bifurcated into lavender essential oil, rose essential oil, tea tree essential oil, rosemary essential oil, peppermint essential oil, and others.

The lavender essential oil segment dominates the global market and is projected to exhibit a CAGR of 7.2% over the forecast period.  Lavender is a mint-family flowering plant. It is cultivated primarily in temperate climates as ornamental plants for gardens, used as culinary herbs, and commercially for extracting essential oils. Lavender oil offers antibacterial and anti-inflammatory effects and can aid in healing minor burns and insect bites. It also treats anxiety, depression, insomnia, and restlessness. The fragrance of lavender is believed to have a fresh and calming effect. Due to its health benefits and freshness, manufacturers invent soaps with lavender essential oil.

Further, essential oil soaps have gained popularity in the past few years and are expected to rise continuously during the forecast period. Manufacturers have incorporated lavender essential oil into their soap formulations, considering its health benefits and soothing properties. Essential oil soaps, including lavender-scented ones, have recently gained significant popularity. Consumers appreciate lavender essential oil's natural and refreshing qualities, making it a preferred choice for soap products. The lavender essential oil segment is the leading player in the global market for essential oil soaps. With its antibacterial and anti-inflammatory effects and calming fragrance, lavender essential oil is highly valued by consumers. The market for essential oil soaps, including lavender variants, is poised for continued growth in the coming years.

Based on the distribution channel, the global essential oil soap market is bifurcated into supermarkets/hypermarkets, e-commerce, retail stores, and pharmaceutical stores.

The supermarkets/hypermarkets dominate the global market and are projected to exhibit a CAGR of 6.4% over the forecast period. A supermarket/hypermarket is a large shopping center where customers purchase products arranged systematically on the shelves. Similar products are arranged nearby, which helps buyers easily compare similar products and decide which products to buy. A supermarket/hypermarket provides ease of purchase to its customers. It offers different types of essential oil soaps of various brands with unique features in each product. An increase in retail sales and channel penetration in the developing markets have created new avenues for market growth.

Moreover, an upsurge in deals and discounts offered to customers by these distribution channels resulted in the dominance of supermarkets/hypermarkets in the global essential oil soap market. Furthermore, supermarkets/hypermarkets will remain the most preferred distribution channel during the forecast period.

Recent Developments

• March 2023- The Body Shop announced the launch of its new line of essential oil soaps.The new soaps are made with a blend of essential oils known for their skin-soothing and moisturizing properties.

• February 2023- L'Occitane announced the expansion of its line of essential oil soaps.The new soaps are made with a variety of essential oils that are known for their therapeutic benefits.