Jane Chai
Research Analyst, Beauty and Personal Care, China

In the past two years, China’s domestic cosmetics market is in the development stage of “building brand power and differentiation”, from substitutes for big brands to unique domestic products, each brand is developing rapidly and continuously capturing market share. On the whole, the success of the Chinese brands mainly relies on three points: first, the golden period of the development of e-commerce; second, to seize the young generation of consumers; third, rely on a single popular product to gain brand recognition. 

The era of e-commerce helped the rise of Chinese beauty brands

With the rapid rise of e-commerce platforms, online shopping, live shopping and short video has created a social e-commerce bonus period. Chinese brands rely on sensitivity to the market and cooperation with KOL to create popular products, such as the rise of Perfect Diary, Florasis, Colorkey, and other brands. 

The young generation do not look at the origin

The younger generation of consumers is more personalized and more willing to experiment than mature consumers in brand selection. Most of the emerging Chinese brands have captured the younger generation of consumers through their personalized brand image or the core of traditional Chinese culture. At the same time, national pride and cultural self-confidence also make consumers more willing to choose Chinese beauty brands.

The single star product helps domestic brands quickly gain brand recognition

Many Chinese brands start by creating star products that have popular colors, ingredients and other topics that are popular on social media to expand. At the same time, affordable makeup also allows consumers to be more willing to try. 

But how to go from attracting new consumers to retaining old consumers, from star product to a complete product lineup, national beauty brands will continue to face tests in the future. 

Quality and personality

In terms of quality, Chinese beauty has said goodbye to hype marketing, and gradually towards the product itself. Many domestic brands already have strong R&D capabilities, forming their own competitive advantages in science and technology, such as Marubi’s patented human protein, Bloomage BioTechnology’s hyaluronic acid, etc.

In terms of personalization, Chinese brands create a high-end image by telling a unique brand story and forming a distinct brand personality. For example, Florasis launched a brand song and virtual character of the same name to elaborate the oriental philosophy of using flowers in makeup and nourishing skin with makeup, etc.

Brand loyalty

In terms of different categories, consumers may differ in terms of brand choice. For example, according to Mintel research on facial colour cosmetics,  consumers rarely try new shades or makeup styles and rarely change brands, and more than two in five of respondents have not made any changes to their makeup routine in the past six months. In the more active area of lip and eyebrow makeup, consumers’ choices are likely to be a bit more diverse.

Skin-nourishing makeup

As consumers become more concerned about skin health, “skin damage” has become one of their biggest concerns when using foundation products and nearly half of respondents chose this as a reason for using primer. Meanwhile, more than three-quarters of the consumers surveyed believe that skin-nourishing foundations do have skincare effects. Therefore, skin-nourishing makeup has great potential in the Chinese market.

Signs of male market awakening

Overall, male consumers have a relatively positive attitude towards skin management. According to Mintel research on skin management, nearly half of male consumers have increased the amount they spend on a single purchase of facial skincare products, and three in 10 have increased the number of general skincare products they use, but few male consumers are willing to invest more time. Men’s demand for skincare and makeup holds potential, but there are difficulties in market communication.

What we think

As for opportunities for emerging brands, although the big brands are growing strongly, there are still opportunities for emerging brands. For example, Florasis became popular through the niche category of loose powder and gradually developed a complete product lineup for the public. For example, Red Earth has seized the hype of skin-nourishing foundations and has achieved good results in core categories like foundation. For emerging brands, there are many opportunity points in niche categories and consumer needs. Another example is that protective and healing makeup is in line with the general health trend and is gaining popularity among consumers.