Indonesia’s haircare market to reach US$1.5bn by 2025, says GlobalData

The Indonesian haircare market is projected to grow from Rp17.7bn (US$1.2bn) in 2020 to Rp22.9bn (US$1.5bn) by 2025 at a compound annual growth rate (CAGR) of 5.3% over the 5-year period, says GlobalData, a leading data and analytics company.

GlobalData’s report, ‘Indonesia Haircare Market Assessment and Forecasts to 2025’ reveals that the market is majorly driven by growth in the salon haircare category, which is forecast to register the fastest value CAGR of 9.7% during 2020–2025. The category is followed by shampoo, which is projected to record a CAGR of 6% during the same period.

Sowmya Penmatsa, Consumer Analyst at GlobalData, says: “The concept of halal in haircare market is gaining momentum in Indonesia with more Islamic consumers are choosing products that are in line with their beliefs. Additionally, in October 2019, Indonesia introduced its mandatory halal law, which requires all products to be halal certified by Majelis Ulama Indonesia (MUI), the country’s top Muslim clerical body. This has created a huge opportunity for multinational companies to launch halal-certified products in the country which will in turn boost the overall haircare market.”

‘Convenience stores’ was the leading distribution channel in the Indonesian haircare market in 2020, followed by hypermarkets & supermarkets and parapharmacies/drugstores.

The value share of Indonesia in the global haircare sector is expected to remain constant at 1.6% by 2025, as shown in the figure. However, the country’s share at a regional level is expected to increase marginally from 4% in 2020 to 4.1% by 2025.

​In terms of leading players, Unilever, Procter & Gamble and L’Oreal S.A. were the top three companies in the Indonesian haircare market by value in 2020 while Sunsilk and Pantene were the leading brands.

Ms Penmatsa concludes: “Personalization trend will continue to drive the Indonesian haircare market as consumers look for products with specific functionalities and which are focused on certain needs. This trend is encouraging the manufacturers to move away from general or multipurpose products and focus on products which are differentiated based on need, age, and gender. For instance, companies are developing products particularly for hijab wearing women/girls who often struggle with problems such as itchy scalp or dandruff due to excessive production of sebum.”

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