Phenoxyethanol Preservatives Market

Market Overview

The phenoxyethanol preservatives market size is expected to surpass USD 163 million in terms of value by 2026.

Phenoxyethanol is a preservative used in personal care products and cosmetics. It is chemically stable  and easy to use in most cosmetic formulations. It is a clear, colorless, and oily liquid with a faint aroma at room temperature and a low evaporation rate. Phenoxyethanol is prepared chemically by the reaction of phenol and ethylene oxide at high temperature and pressure.

Market Dynamics

Market Opportunities 

Accessibility

With the advent and accessibility provided by the internet, consumers have become more aware of beauty and skincare products. The availability of skincare products, due to e-commerce, from all over the world with low shipping costs has catapulted the demand for such products, which is bolstering the phenoxyethanol preservatives market. Growing demand for paraben-free products has led to increased investments in the research and development of cosmetic and skincare products.  Phenoxyethanol preservatives are also widely used in the pharmaceutical industry in vaccines for polio, diphtheria, and influenza, among others. Technological advances have enabled the creation of multifunctional products using phenoxyethanol preservatives and gained popularity due to the emphasis on value for money.

Innovation & Product Development

Innovations continue to drive sales for the cosmetics market, with several important brands such as Loreal and Olay focusing on new formulas and new packaging. Anti-aging and pollution protection sunscreens are famous among aging and the baby boomer generation. Men are increasingly becoming more conscious of their appearance, which is driving the sales of skincare and aftershave products, in turn providing impetus to the phenoxyethanol preservatives market.

Look Good, Feel Better

Look Good Feel Better (LGFB) is a charity dedicated to improving the self-esteem, confidence, and wellbeing of women undergoing cancer treatment. This initiative is supported by over 50 leading companies and brands from the cosmetics industry. It helps in improving self-image and appearance through free group and self-help skincare and make-up workshops. This free service is available in 26 countries worldwide, and millions of people have been supported to date by this initiative. A major research initiative highlighted that 97% of respondents felt more confident after attending an LGFB workshop. Initiatives such as these also drive the growth of the skincare and cosmetic industries.

Global Consumer Spending

Around the world, consumers are looking to improve their financial wellbeing, particularly in developing markets across Latin America, Asia-Pacific, Africa, and the Middle East. Around 58% of global consumers feel they are better off financially than they were five years ago. Consumers’ perceptions of their financial situations play a key role in influencing their purchasing behavior. With the growing disposable income Asia-Pacific and growing awareness, consumers are looking for more choices, which is accelerating the demand for cosmetic and personal care products and, subsequently, driving the growth of the phenoxyethanol preservatives market.

Challenges Faced by Players in the Phenoxyethanol Preservatives Market

Today’s cosmetics and personal care industry faces a number of challenges as it strives to maintain a balance between the safety and integrity of its products. Allergic reactions and skin irritation hinder adoption among the affected population. The Food and Drug Administration (FDA), in the U.S., has declared warnings regarding the toxicity of phenoxyethanol preservatives in excess concentrations. Moreover, natural preservatives such as neem seed oil, grapefruit seed extract, tea tree oil, lavender oil, and others act as alternatives to phenoxyethanol preservatives. Rising demand for organic cosmetic ingredients due to the adverse health effects of synthetic chemicals will hinder the phenoxyethanol preservatives market growth to some extent.

Segmental Analysis

Phenoxyethanol P5

Phenoxyethanol P5, a high-grade preservative with less than 5 ppm of phenol content, is used on a large scale in the cosmetics industry. The demand for Phenoxyethanol P5 is expected to register an increase during the forecast period.

Phenoxyethanol P25

Phenoxyethanol P25 has higher phenol content, which can be toxic for humans, and is used widely in various water-based architectural and industrial coatings. On account of the resurgent increase in construction and industrial development activities, the demand for phenoxyethanol P25 preservative is expected to escalate in the coming years.

Home and Personal Care Application Segment

The home and personal care segment holds almost a 40% market share. Cosmetics, perfumes, ointments, and detergents are considered in this segment. Customers are becoming increasingly aware of the risks posed by different ingredients used in cosmetic products. In the U.S., the cosmetics industry operates with oversight by the Food and Drug Administration, and in China, there has been significant cosmetic product withdrawal from the market due to safety concerns. This has forced manufacturers to invest in research and development to develop blends that have a negligible effect on skin and high efficacy.

Large Market for High-Quality Cosmetics in Europe

Europe is one of the largest cosmetics markets in the world. In Europe, the sales of beauty care products rose by EUR 65 million in 2017 to amount to a total of EUR 13.6 billion. This development is based on high-quality market launches from Loreal, Neutrogena, Nivea, and others. The leading growth segments are face care, oral care, and bath and shower preparations. The total sales revenues of cleaning and care products and detergents for private households were quite stable at EUR 4.7 billion, and the main categories of products are heavy-duty laundry detergents and hard surface cleaners.

Regional Analysis

Online Shopping of Cosmetics in Asia-Pacific

In Asia-Pacific, countries such as South Korea and Japan are leaders in cosmetics and personal care products and will continue to note high growth during the forecast period. The Japanese market is considered to be sophisticated. The country registers significant demand for anti-aging creams, which is contributing to the demand for phenoxyethanol preservatives as well. In South Korea, increasing penetration of the internet and the popularity of e-commerce channels are driving consumer product sales. According to the Korean National Statistical Office, the online shopping market transactions grew 19.2% year-on-year to USD 68 billion in 2017. Of these, mobile shopping transactions amounted to USD 42 billion, up 35% from the previous year, accounting for 61% of total online shopping. This has led to increased investment in cosmetic and personal care product industries and improved the demand for phenoxyethanol preservatives.

Substantial Demand for Both Men’s & Women’s Cosmetics in Latin America

Latin America, led by Brazil, is likely to observe substantial growth trends during the forecast period. The regional market was valued at nearly USD 14 billion in 2017 and is anticipated to grow at a CAGR of 4.76%, mainly attributed to the higher regional consumer spending on beauty products. While the sales of women’s cosmetics in the region is substantial, men’s cosmetics have also seen a prominent increase in demand in recent years.