Sustainability's Impact on Profitability: A Closer Look at How It's Reshaping the Skincare Industry for New-Age Businesses

✍️ Opinions

Subham Agrawal

Feb 9, 2024 — 5 min read

Embracing sustainability in skincare: A path to profit and planet-friendly practices

This article has been contributed by Aman Mohunta, Co-Founder, Aminu Wellness.

Sustainability has become a crucial factor for the long-term survival and value creation of any brand, regardless of trends or profitability. Sustainability has emerged as a pivotal factor in influencing the long-term survival and value creation of brands. Today, not only is it strategically imperative but also commercially viable. In my opinion, two major factors have made sustainability a crucial business strategy – the increasing level of consumer consciousness and the constantly developing regulatory shifts.

Rise of the Conscious Consumer
Regulatory Compliance and Future-Proofing

Rise of the Conscious Consumer

Here are the reasons leading to the rise of conscious consumers:

Increasing Consumer Consciousness

Modern consumers are increasingly aware of the environmental impact of their lifestyle choices, and this consciousness extends to their consumption behaviour including beauty and skincare routines. The demand for transparency in product sourcing and manufacturing processes has led consumers to scrutinize labels and opt for brands that share their commitment to sustainability. As a living example, we have seen that brand values & practice of sustainability foster loyalty and trust among consumers, leading to repeat business and positive word-of-mouth marketing. Brands like Aminu have managed to differentiate themselves in this saturated industry with eco-friendly packaging, cruelty-free practices, and responsibly sourced ingredients.

Premium for Commitment to Stability

In a market saturated with skincare options, establishing a brand as a champion of sustainability has proven to be a powerful differentiator for brands like Aminu. Sustainable skincare products, characterized by eco-friendly packaging, cruelty-free practices, no use of micro-plastics and responsibly sourced ingredients, are gaining traction even in p markets such as India. Consumers today understand the importance of adopting more sustainable consumption choices and are increasingly willing to pay a premium for products that demonstrate a commitment to sustainability. This willingness signifies a tangible manifestation of this endorsement.

Loyalty and Positive Word of Mouth

Investing in eco-friendly practices can position a skincare brand as a conscientious choice, attracting consumers who prioritize ethical considerations in their purchasing decisions. What was once considered a niche market has soon become a thriving segment and businesses including Aminu skincare are finding that sustainability in skincare not only helps build a stronger relationship with the consumers and benefits the planet but also contributes to their bottom line. Investing in eco-friendly practices attracts consumers who prioritize ethical considerations in their purchases.

Consumer Education

This rise of consumer consciousness is intrinsically linked to increased education on environmental issues. If not learnt in school, consumer consciousness is built as and when people become more independent and start purchasing their products. As consumers become more informed about the consequences of their choices, they actively seek out brands that align with their values. Brands that invest in this consumer education as well as practicing what they preach, not only contribute to a more informed audience and potential customer base but also position themselves as frontrunners in the dynamic future of sustainability. Engaging with consumers on matters of sustainable improvement is integral, and incorporating their feedback is crucial. Open communication channels between a brand and its audience can build a sense of community as well as give the brand valuable insights for future sustainability strategies.

Regulatory Compliance and Future-Proofing

Global Regulatory Shifts

As global awareness of environmental issues grows, governments and regulatory bodies especially in North America & Europe are tightening standards and implementing stricter regulations. Skincare brands that proactively adopt sustainable practices position themselves for compliance with near-future regulations. This proactive approach not only mitigates the risk of becoming obsolete in these markets but also signals to consumers that the brand is committed to responsible and ethical business practices. While one might argue that such regulations are still decades away in India, I would disagree. Today India seeks a seat at the table of global superpowers and to do that it will have to show leadership in several spheres including leading the way in adopting sustainable practices sooner rather than later.

Leadership in Sustainable Practices

Future-proofing the business by embracing sustainability is not just about compliance; it's about staying ahead of the curve. Brands that invest in sustainable practices today are better equipped to navigate future changes in regulations and consumer expectations, ensuring long-term viability in an evolving market.

Supply Chain Sustainability

Beyond end-product sustainability, every step of the production process should also reflect that same eco-friendly attitude. The sustainability of the entire supply chain is gaining prominence, with brands realising the importance of every step from production to distribution should adhere to sustainable practices. Not only would this ideally align with regulatory expectations but also serve as a comprehensive approach to sustainability.

Technological Innovations

While sustainable practices are constantly evolving, a lot of it is driven by technological advancements. Brands that invest in research and development to incorporate cutting-edge technologies and ingredients into their products and processes not only future-proof their operations but also contribute to overall sustainability in the industry. For example, curbing water & energy usage & wastage during the production process and the use of biodegradable or reusable materials in packaging reduces the carbon footprint of the company and of the industry as a whole if these methods are adopted by all.

Revenue of the Skin Care Market Worldwide From 2015 to 2028

Conclusion: A Sustainable Future for Skincare

In conclusion, the intersection of sustainability and skincare is proving to be a profitable venture for businesses willing to embrace responsible practices. From meeting consumer demand and building a positive brand reputation to market differentiation and cost efficiency, the benefits of sustainability in the skincare industry are multifaceted.

As the beauty and skincare landscape continues to evolve, brands that prioritize sustainability position themselves not only as contributors to a healthier planet but also as leaders in an industry undergoing a transformative shift and becoming future-proof. The profitable pursuit of sustainability in skincare is not just a trend; it's a strategic choice that can lead to long-term success in an environmentally aware market.