Being home to the world’s largest Muslim population, Indonesia has emerged as a significant global destination for halal cosmetics. In their pursuit of recovery from the COVID-19 pandemic, Indonesian skincare companies are focused on promoting the acceptance of halal cosmetics. The emergence of indigenous halal cosmetics brands is instrumental in fueling the demand for such products in Indonesia. By targeting both Muslim and non-Muslim customers, Indonesian skincare companies aim to make a significant impact in the Asia-Pacific (APAC) health & beauty industry , which is set to expand by a volume compound annual growth rate (CAGR) of 3–4%over 2022–27*, according to GlobalData, a leading data and analytics company.
Mani Bhushan Shukla, Consumer Analyst at GlobalData, comments: “The increasing number of female students and their active participation in the workforce in Indonesia, Malaysia, Singapore, Brunei, and other Southeast Asian nations have fueled the popularity of halal cosmetics. This aligns with GlobalData’s Q4 2023 consumer survey finding that 72% of female consumers in APAC were in paid employment**. Moreover, beauty parlors and salons have embraced halal products to cater to the needs of Muslim customers, making their services more inclusive and accommodating.”
Tim Hill, Key Account Director, SE Asia, GlobalData, notes: “In 2014, the Indonesian government introduced a mandate for halal certification across an extensive range of consumer products. Furthermore, by 2026, cosmetics will also be subject to mandatory halal product assurance. Additionally, it is imperative that they acquire the official seal of approval from the Indonesian Council of Ulama, a halal certification organization. Adhering to halal standards necessitates cosmetics producers to meticulously avoid incorporating alcohol, blood, carrion, swine derivatives, or any other ‘haram’ ingredients prohibited by Islam in any aspect of the procurement, production, or storage of raw materials.”
Shukla adds: “The younger population in Indonesia favors locally produced halal cosmetics due to their compatibility with a wide range of Asian skin tones. Moreover, domestic brands have been focusing on developing cosmetics that are well-suited for the local weather conditions. To capitalize on this trend, multinational companies are making strategic investments in domestic brands. For instance, in December 2022, Unilever invested $6 million in Esqa, an Indonesian beauty brand. Indonesia’s Rose All Day Cosmetics (RADC), among other Halal-certified cosmetics companies, achieved a substantial fourfold rise in their annual revenue during 2022, indicating the surge in the demand for halal cosmetics in the country.”
Hill concludes: “By emphasizing product quality and ingredient safety, halal cosmetic makers can gain mass retail acceptance. Millennials and Gen Z cohorts, who pay close attention to the ingredients in beauty products, are likely to be enticed by such offerings. This high-quality consciousness is corroborated by GlobalData’s consumer survey, wherein the majority (44%) of Indonesian respondents connote high-quality ingredients with ‘good value for money’ when buying beauty and grooming products***. Additionally, manufacturers can disseminate information about halal products using popular online platforms such as Facebook, YouTube, X, Instagram, Line, KakaoStory, TikTok, WeChat, and Weibo.”
* GlobalData Consumer Intelligence Center – Market Analyzers, accessed in February 2024
**GlobalData Q4 2023 Consumer Survey – Asia and Australasia, with 6163 respondents, published in December 2023
***GlobalData Q4 2023 Consumer Survey – Indonesia, with 531 respondents, published in December 2023
