Aromatherapy Market Overview
The global aromatherapy market generated $1.2 billion revenue in 2017 and is projected to showcase a CAGR of 9.4% during the forecast period, due to the rising awareness about the therapeutic use of essential oils, increasing consumer preference toward natural products, and increasing prevalence of lifestyle diseases.
GLOBAL AROMATHERAPY MARKET, BY PRODUCT, $M (2014-2025)
Globally, on the basis of product, consumables was the larger category in the aromatherapy market, with contribution of 76.8% in 2017. This leading position of the product category is mainly due to the increasing adoption of consumables such as essential oils as therapeutic agents for treating various diseases, as these essential oils promote natural healing.
The aromatherapy market is categorized into topical application, aerial diffusion, and direct inhalation, on the basis of mode of delivery. Globally, topical application is the most preferred mode of delivery and accounted for 41.9% share, in 2017, in the aromatherapy market, mainly due to increase in preference for topical application of essential oils for various skin-related problems. The high preference for this mode of delivery is because of the reason that essential oils can be diluted in a cream or carrier oil and applied as required to the concerned area of the body.
Aromatherapy finds application in relaxation, skin and hair care, pain management, cold and cough, insomnia, scar management, and others. During the historical period relaxation was the largest application area for aromatherapy and accounted for 22.4% share in the aromatherapy market in 2017. This largest share is attributed to the increasing number of people suffering from anxiety and stress, and side effects associated with other alternative medicines.
Geographically, the aromatherapy market is predicted to witness fastest growth in Asia-Pacific (APAC) during the forecast period. This growth is supplemented by increasing awareness about the benefits of aromatherapy in treating various health conditions, high production of essential oils in the countries including China, India, Australia, and Indonesia, and growing trade of essential oils in and outside the region.
Further, APAC is a potential market for market players, due to the high population base, increasing prevalence of chronic disease and lifestyle associated disease, and increasing disposable income of people in the region. Moreover, medical tourism makes APAC a lucrative market for aromatherapy, as countries such as India, which has its traditional procedure of using essential oils and various natural resources for therapy for the treatment of illness attracts various tourist across the world.
Aromatherapy Market Dynamics
Growing use of aromatherapy at-home, rising preference about the therapeutic use of essential oils, increasing consumer preference toward natural products, and increasing prevalence of lifestyle diseases are the major factors driving the growth of the aromatherapy industry.
Essential oils are extracted from plants and processed naturally, these oils are non-toxic and are safe for inhalation and topical uses. These beneficial features of essential oils along with rising awareness about the therapeutic use of these oils has been shifting the preference of the consumers toward these products. In addition, there has been a steep rise in the number of people opting for self-medication to deal with various pain and common cold.
Moreover, various adverse effect of pharmaceutical therapeutics is also a key reason for shifting interest of people to use natural essential oils. For instance, rosemary oil can cure both cold and cough or a headache, if inhaled, and can also be used as a solution for skin and hair care, if used topically. Thus, benefits offer by natural products in treating various health condition has changed consumer’s preference from synthetic to natural products, which in turn contribute in the growth of the aromatherapy market.
Rise in disposable income, across the globe, has led to an increase in the spending power of people and also contributed to the increased adoption of essential oils that fit their health and wellness need, eventually supporting the growth in aromatherapy industry. According to the Holistic Aromatherapy Association (HAA), clary sage to relieve pain, eucalyptus as decongestant and ginger which aids in digestion are the most commonly used essential oils by consumers.
According to the U.S. Bureau of Labor Statistics (BLS), there has been an increase in the personal disposable income of the U.S. population. It increased from $11,394 billion in 2006 to $15,929 billion in 2016 and is expected to reach $24,174.5 billion by 2024.
According to the Organization for Economic Co-operation and Development (OECD), the household disposable incomes (annual growth rates) in Germany and Denmark increased from 1.57% and 1.18% in 2014 to 2.53% and 2.80% in 2016, respectively. Thus, with the increase in household disposable income, the purchasing power of people has increased, leading to their inclination towards experiencing aromatherapy services in spas and salon for treating various health conditions such as anxiety, insomnia, pain, inflammation and stress.
Aromatherapy Market – Competitive Landscape
Key players in the aromatherapy market are acquiring other players to expand their business to introduce advanced products. For instance, in September 2017, Schmidt's Naturals and Edens Garden entered into an agreement to launch new fall-inspired deodorant Earth + Wood, which is made up of pure essential oils. The partnership is expected to evolve more offering to meet the demands of the customers.
In May 2017, Young Living Essential Oils made a non-cash acquisition of Life Matters LLC, a wellness company. Both the companies are based in the direct selling industry and share common goals, culture and mission.
Some of the other key players operating in the aromatherapy industry are dōTERRA International LLC, Rocky Mountain Oils LLC, Plant Therapy Essential Oils, Mountain Rose Herbs, and Frontier Co-op.