Why CBD Cosmetics Market Is So Promising?

20 June 2022

The CBD cosmetics market is currently pulling the CBD spotlight towards itself. And honestly, we can’t say we’re surprised, considering the skin care industry is currently in popular demand.

Perhaps the major reason for this megahit is the legalization of CBD products. Another rationale might be the rising awareness of organic cosmetic products in different regions. With the current trend, the CBD-infused cosmetic market will be worth $6 billion by 2025. Most investors would want to throw their money into this bullish venture. It only makes sense you consider it too.

Not so fast, though! You need all the information you can get, and this is where we slide into the picture. Stay with us for a comprehensive insight into why the CBD cosmetic market is so promising.

What is CBD? – What You Need to Know

Cannabidiol (CBD) is a chemical compound extracted from the cannabis plant. This extract is devoid of psychoactive activity, unlike Tetrahydrocannabinol (THC). It invokes the feeling of intoxication when people consume cannabis.

CBD can be extracted from hemp and marijuana. Hemp is a special breed of the cannabis plant that contains a minute amount of THC, whereas marijuana contains a more considerable amount of THC.

Although both plants are Cannabis Sativa plants, regulatory authorities view them differently. We’ve seen that there is often a lack of clarification from brands over the difference, mostly leading to legal problems.

THC or CBD? Which is Legal?

THC distribution remains illegal in many countries today due to its constant abuse. Although selling CBD products containing THC is legal, different countries have speculated about the permissible content of THC in these products. Some regions even classify CBD products as “control drugs.”

Notably, not all CBD products are legal. You will find that the rate at which CBD products are adulterated with THC is alarming. The FDA firmly opposes selling marijuana-based products as CBD products.

Therefore, to avoid legal consequences, you must get acquainted with local, state, and federal laws before acquiring and using CBD or THC.

Legal CBD products are widely used in most parts of the world for their medical benefits. CBD products vary, but popular options include oils, isolates, topicals, cosmetics, edibles and patches.

As a prescription drug, CBD is used to treat health issues such as anxiety, epilepsy, chronic pain, autoimmune diseases and many other ailments.

What You Should Know About CBD Cosmetics

Regardless of whether CBD cosmetics are permitted in your region, getting your facts right about CBD cosmetics is crucial.

Established beauty brands need to school their customers to have comprehensive knowledge of CBD and related products. They should broaden their understanding of potential medical benefits, side effects, and the differences between CBD and other cannabis extracts.

In the same vein, it is pivotal that these beauty brands assure customers that their CBD is acquired from legitimate sources and ensure adequate quality control. Consumers might eventually demand proof that CBD cosmetic products will yield the desired results.

You wouldn’t want to willingly migrate to a region where their regulatory authorities would confiscate your CBD cosmetics. The legal consequences of transporting illegal CBD products might be unbearable. Some might even end up the jail, which we dare say is not in your to-do list.

How Does CBD Cosmetics Work?

CBD cosmetics are mainly produced as topicals, meaning they are meant to be applied only on the skin. This is why they generally can’t reach the bloodstream and exhibit a localized effect.

Lately, some CBD beauty products are being manufactured as dietary supplements like capsules and edible CBD oils. As such, these products work very differently from the topicals as they will be ingested and delivered throughout the body.

Consumed products are the best option for full-body effects rather than localized effects on your skin. However, you must ensure these supplements’ legitimacy before purchasing them.

CBD’s Increasing Role in the Beauty Industry

To date, the role of CBD in the beauty industry is nothing short of remarkable, alluring attention from investors, global brands, and influential entrepreneurs. More so, beauty consumers are becoming more experimental with their beauty products, trying skin care products and hair care products.

CBD is a multi-functional substance in cosmetics that can be infused into makeup, skincare fragrances, and even hair products. The authorities regulate CBD-based skin care products due to their THC content.

Aside from its popular anti-inflammatory activity, some recent studies have suggested that CBD has potential neuroprotective, antioxidant and hydrating properties that could be great for treating certain skin conditions.

Benefits of CBD-infused cosmetics

Take a look at the brief overview of the potential beauty benefits of CBD:

  • Dry Skin Treatment: Some promising studies show that CBD might help hydrate dry skin.
  • Acne Treatment: Anti-acne is an activity attributed to CBD due to its antimicrobial properties and ability to inhibit or reduce sebum production.
  • Anti-ageing Treatment: CBD has potential antioxidant properties that can help decrease the visible signs of ageing by counteracting the activity of free radicals.
  • Relieve Inflammatory skin conditions: The potential anti-inflammatory activity of CBD is perceived to help ease inflammatory skin conditions like acne breakouts, skin irritation, psoriasis and eczema.

However, the effectiveness of CBD is still up for debate, and the need for more conclusive research to confirm these medical claims remains pivotal.

Current CBD Cosmetic Industry Trends

CBD has taken the world’s cosmetic market by storm. The CBD cosmetics market was valued at 633.6 million USD in 2018. Sales in 2020 declined due to the pandemic.

Presently, future market insights have provided unbiased analyses of the CBD market. The reports from these analyses indicate that this beauty market is anticipated to reach 5.4 billion USD by 2026. Dominating growth, right?

In previous years, the major setback to the growth of the CBD cosmetic market was the legalization of various cannabis plants to manufacture CBD products. Perhaps, the most current progression in the legalization of CBD is the 2018 Farm Bill passed in the United States.

This law constitutionally legalized the production of industrial hemp around the 33 states. As such, it has led to the increasing demand for CBD-infused beauty products in U.S, Canada and some districts in Colombia. The European Union has also recognized CBD as safe for adding to cosmetics.

If CBD cosmetics popularity continues at this current rate, their usage will likely become normalized and mainstream, ultimately rebounding the CBD cosmetic market. Furthermore, the presence of leading market players will boost regional growth in the next few years.

Further key findings from reports suggest that:

  • The global CBD skincare market is expected to register a growth at a CAGR of 32.9% over the forecast period
  • Hemp-based products have generated a revenue of 147 million USD as of 2018.
  • North America holds the leading share of more than 40% in the global CBD skincare market and is expected to grow with the highest CAGR during the forecast period.
  • The growing adoption of online shopping platforms and sales channels will develop growth opportunities for the market.
  • Some influential market players operating in the beauty industry include; Green Light Acquisitions LLC, Medical Marijuana Inc, Elixinol Global Limited, The Estee Lauder Companies Inc., Lord Jones, The CBD skincare company and Leef Organics.

You should anticipate the production of more CBD-infused cosmetics from established brands and the launching of more CBD-based beauty brands.

Key CBD Cosmetic Market Segments

The global CBD-infused cosmetic industry is segmented based on product type, source, distribution channels and geography.

By Product type, there are:

  • Skincare and Haircare
  • Cleansers and Exfoliants
  • Creams and Moisturizers
  • Masks and serums
  • Makeup and Fragrances
  • Others

By Source:

  • Hemp
  • Marijuana

By Distribution channels:

  • E-commerce
  • Pharmacies
  • Supermarkets and Specialty Stores
  • Others

By Geography:

  • North America
  • Europe
  • South America
  • Asia Pacific Region
  • Europe, Middle East and Africa

CBD Cosmetics Business Opportunities in 2022

A big picture question would be, why are companies excited about getting into CBD? Perhaps times were never so thrilling to invest in the CBD cosmetic market.

Despite the CBD-infused cosmetic market being regarded as one of the most lucrative businesses to venture into, surprisingly, entrepreneurs already in the market and those considering entering it have doubts about the future of the industry.

We cannot blame them. It would be tricky if they didn’t reflect on what the future holds for their investment. Is the market promising? Will it stand the tough test of time?

Again, we cannot say what will happen in years to come. However, this report will consider the top business opportunities you can track in the CBD cosmetic industry. Let’s get right into it.

• CBD Market penetration

The CBD-infused cosmetics market is fragmented, with various niches to venture into. The growing competition and consumer demand for improved products have led to the expansion of the CBD products portfolio.

Today, there are products like exfoliating scrubs, foaming cleansers, facial toner and refreshers, hydrating facial serum, eye cream, facial moisturizers, hydrating shampoo, and lip conditioners.

Prominent manufacturers of CBD-infused cosmetics are also launching products for men. Cosmetic products are no longer restricted to women anymore. Therefore, manufacturers are responding to the increasing demand from the men’s segment.

Another good thing about this product diversity is that manufacturers can charge a higher price for their premium products.

The penetration of these various CBD-based products has contributed immensely to the growth of the CBD cosmetics market by expanding the sales network worldwide.

• Online Shopping Platforms

It is no longer news that e-commerce has become the order of the day. We cannot hype this enough. The ease at which people can now shop or order their CBD cosmetic products from their comfort zones is astonishing.

Marketing nowadays can be in different forms. By utilizing these platforms, you don’t need to manufacture, transport or even have the products. You can market the products to customers for a commission.

Undoubtedly, integrating CBD-infused cosmetic products on online shopping platforms has driven more sales and boosted market growth.

• CBD Product Awareness

The numerous opportunities posed by social media platforms cannot be overlooked. These platforms have been rapidly approving the advertisement of CBD products. With the right approach, you can reach quite many target audiences.

With the rising awareness of CBD products, many health professionals recommend them to their affected patients. Consequently, the awareness created is increasingly driving more sales of CBD cosmetics.

However, you must be cautious when making claims about CBD-based products as restrictions guide their advertisement. For CBD-infused cosmetics, your claims should be limited only to its cosmetic benefits. You wouldn’t want to draw unnecessary attention to your business by the ever-watchful FDA and FTC.

Favorable Regulations to Drive CBD Beauty Trends across the World

Driven by the rising demand from the CBD-based skincare care sector, CBD has become a key ingredient in the CBD cosmetic market. Throughout the world, various suppliers have been busy launching cosmetic products.

Presently, you will find CBD cosmetics across various retailers in Europe, including online platforms. The CBD beauty market also trends across Latin America and Australia.

Thanks to more favorable regulations, these regions have perceived significant business initiatives and product launches of CBD cosmetic products.

Perhaps with the recent legalization of industrial hemp cultivation in the United States, manufacturers can legally grow industrial hemp and sell CBD beauty products within the states.

In addition, countries whose regulatory authorities have initially banned CBD products now allow the shipping of CBD-based products that comply with their set permissible content.

Conclusion

The recent trend in the CBD beauty market has attracted attention from investors and global brands. Generally, CBD products are not mainstream in distribution and media acceptance, yet the CBD cosmetic market remains promising.

With more favorable regulations rising across the globe, the CBD cosmetic market will likely be worth more than we imagine – and soon too. However, you should still exercise caution and get your facts right before investing.

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