Indonesia Halal Hair Care Market Size, Share & Trends Analysis Report By Product (Halal Shampoo, Hair Color, Conditioners, Hair Oil), And Segment Forecasts, 2018 - 2025

Industry Insights

The Indonesia halal hair care market size revenue was estimated at USD 420.9 million in 2015. Increasing preference of the Islamic population towards the consumption of beauty products that are ethical & compliant with religious laws has driven market growth in recent years.

Indonesia has the largest Islamic population, with approximately 87% of the overall population identifying themselves as Muslims. Rising income in the middle-class Muslim population, along with strong cultural & ethical beliefs has been responsible for driving interest in halal cosmetics, hair care, and beauty products.

Indonesian halal hair care market revenue by product, 2014 - 2025 (USD Million)

Islamic regulations & laws prohibit alcohol and animal by-products such as pork, blood, or others that do not conform to slaughtering practices as stipulated by the Holy Quran (Islamic religious book). These regulations and consumer mindsets have been extended to cover cosmetics and beauty products as well since they come into contact with the skin & scalp regularly.

These products can be traced back to their entire value chain for quality assurance. Consumers are willing to pay a premium price for better quality organic products. Nail polishes and lipsticks targeting Islamic women who need to perform ‘Wudu’ (ablutions) before their daily prayers have gained immense popularity in the industry.

Similarly, specific shampoos, conditioners, and serums targeting women who keep their hair covered with veils, ‘Hijabs’ or other headgear, are expected to influence industry trends. Major companies such as Unilever have introduced ‘Hijab shampoos’ under the umbrella of their Sun silk range.

Increasing usage of specific personal care products among men has greatly influenced the halal hair care market growth. Nowadays Indonesian men are giving more importance to personal grooming and think of it as a necessity rather than a luxury.

The Indonesian government has issued a regulation according to which any product that enters, is distributed and traded in the country, and claims to be halal should be certified by 2018. This certification requires all companies to conduct laboratory tests on raw materials utilized for production, creating new marketing & manufacturing opportunities in the country.

Indonesia has a large base of organic resources and cheap labor, creating a major attraction for international brands and domestic companies that wish to venture into more business activities, which is expected to fuel market growth.

Haircare is expected to experience higher growth as compared to other beauty care segments. Consumers are demanding natural products that would provide treatment functions such as antidandruff. An increase in the number of hijab-wearing consumers has led to greater demand for personal care products that provide additional benefits such as volumizing, and prolonged freshness and fragrance.

As of 2010, the global population was 6.92 billion which increased to about 7.4 billion in 2016. In 2015, the Islamic population was estimated at 87% of Indonesia’s overall population. Asian countries such as India, Pakistan, and Bangladesh all have high Islamic population numbers, presenting a large target market for halal companies.

Furthermore, an increasing number of working women and the spread of literacy in these emerging economies have boosted spending power among the demographic, which in turn has attracted large investments in the Asia Pacific and especially Indonesia.

The growing adherence to Hijabs and other religious head coverings has also had a significant impact on the cosmetics and beauty segment. Consumers, including men, are spending larger amounts on grooming and personal appearance to comply with transitioning social standards. These factors are expected to contribute positively to industry growth over the near future.

Product Insights

Halal shampoo emerged as the leading product category and accounted for over 33% of the total revenue in 2015. These are usually made from herbs, fruits, flowers, vegetables, seaweeds, and fresh ingredients, contributing to nourishment & restoring vitality. Shampoos cater to specific complications associated with covered scalps (hijabs), addressing dandruff & limp hair for women.

Additionally, these shampoos are marketed targeting specific hair loss issues, making them a popular option for women desiring smooth, soft, and glossy tresses. Such products are not only popular among Islamic consumers but also among the non-Islamic population who prefer holistic cosmetics and personal care products.

Conditioners are expected to emerge as the fastest-growing segment with a CAGR of 12.2%. Islamic women are increasingly utilizing products that foster higher volume and restore the natural vibrancy of locks, in line with international trends. Technological advancements and the integration of natural, organic herbs and essential oils into these products are also driving their demand.

Indonesia halal hair care market potential revenue by product, 2017 (%)

Conditioners also gently detangle tresses, infusing it with natural ingredients and keratin. They also repair the cuticles and help in the improvement of the texture. Conditioners nourish, moisturize and effectively prevent the loss of protein, which has contributed to their popularity among this demographic.

Natural hair color has also gained popularity in recent years, owing to the rising awareness among consumers regarding the carcinogenic effects of chemical dyes. Natural, organic, vegan-friendly, and non-toxic ingredients are being used to prepare colors that comply with Islamic regulations, which has propelled their demand in the country.

Indonesia Halal Hair Care Market Share Insights

The market has expanded corresponding to the growing Islamic population in Indonesia. Key participants in the industry include Unilever, L'Oréal, Wardah, Sariayu Cosmetics, Procter & Gamble, Clara International, Iba Halal, and Saaf Skincare among several others.

International brands such as Unilever and L'Oréal currently dominate the market with their large portfolios of premium brands and loyal customer base. Local companies thus face challenges such as poor branding, advertising, and technical disadvantages.

Furthermore, regional consumers are unaware of the detrimental effects of unsuitable foreign products and brands' incompatibility with their skin types. However, the industry is expected to provide several growth opportunities to local companies that invest in new technologies & cater to niche segments.

Local & multinational companies are also investing heavily in Indonesia to cater to the growing demands of the expanding Islamic customer base. Companies are focusing on expanding their distribution networks to reach a wider consumer base.

Report Scope

Segments Covered in the report

This report forecasts revenue growth and provides an analysis of the industry trends in each of the sub-segments from 2014 to 2025. For this study, Grand View Research has segmented the Indonesia halal hair care market based on product:

• Product Outlook (Volume, Tons; Revenue, USD Million, 2014 - 2025)

  • Shampoo

  • Hair Color

  • Conditioners

  • Hair Oil

  • Styling products