Recently, the news of "Chinese cosmetics becoming popular in South Korea" has surged to the hot search. Data shows that in the first eight months of 2023, the export value of Chinese cosmetics to South Korea increased by about 190% year-on-year. Not only South Korea, but China's cosmetics exports have maintained rapid growth since 2023. In 2023, the retail sales of cosmetics in China reached 414.2 billion yuan, a year-on-year increase of 5.1%. The export value of China's beauty, cosmetics, and toiletries was 45.8 billion yuan, a year-on-year increase of 22.8%. Among them, Southeast Asia and Japan and South Korea are the most important export destinations. According to data forecasts, domestic beauty sales are expected to increase by 21.2% year-on-year in 2023, with a market share of 50.4%, surpassing foreign cosmetics brands for the first time.
Why has domestic beauty sales increased significantly? What is the password for domestic beauty products to become popular? What difficulties do Chinese domestic cosmetics need to overcome to stand out in international competition?
Continuous sales growth
"Behind the continuous growth of domestic cosmetics, first, domestic cosmetics, taking advantage of the China-Chic trend, have integrated Chinese traditional cultural elements, which is in line with the current popular aesthetic; second, the product quality has been greatly improved, which is capable of meeting the needs of a new generation of consumers; third, new and old brands have actively innovated and upgraded, expanding the product market." Secretary General of the China Science and Technology Alliance (preparatory) for Skin Health Industry, Zhuang Xiaojie, President of the Cosmetic Industry Branch of the National Health Industry Enterprise Management Association, said.
In recent years, the recognition of domestic brands by consumers has been continuously increasing, and more and more consumers are willing to try and support domestic beauty products. According to a questionnaire survey organized by the Longwan District Consumer Protection Commission in Wenzhou City, Zhejiang Province, young people aged 20 to 35 are currently the main consumers of domestic cosmetics, accounting for 70.68% of the total. Among them, 59.52% have been using cosmetics for 1 to 5 years. In addition, a research report shows that 48% of beauty consumers aged 18 to 49 tend to prefer local products.For example, the
Makeup Brush Set in Cangzhou, Hebei Province, is very famous and has produced many
foundation Makeup Brush brands,Chinese women are becoming more aware of facial care,They have more choices for
Loose Powder Brush. A scholar who has been paying attention to domestic beauty for many years told reporters that domestic beauty is gradually breaking away from the previous low-end and cheap image by improving quality, innovating research and development, and brand building, and gaining more and more recognition from consumers. Moreover, domestic beauty products are more cost-effective, and consumers can often buy high-quality domestic beauty products at lower prices.
Experts say that in the past two years, there has been a high demand for popular cultural consumption, which has to some extent stimulated the deep integration of culture and consumer goods. A number of innovative domestic beauty brands have emerged, which have quickly won the favor of consumers while competing with international brands in the market competition. Excellent quality and brand characteristics not only meet domestic consumer demand, but also export many products to other countries and regions.
Creating a circle through both internal and external cultivation
In recent years, domestic beauty products have gradually begun to focus on quality. Taking Huaxi Biotechnology as an example, the company's R&D investment from 2020 to 2022 was 141 million yuan, 284 million yuan, and 388 million yuan, accounting for 5.36%, 5.75%, and 6.1% of revenue, respectively. In the first half of 2023, the company's research and development expenses reached 187 million yuan, a year-on-year increase of 4.04%. The R&D investment to sales ratio of Maggie Li is about 5%, and the number of new skincare products launched each year is controlled in single digits. The product development cycle is between 12 to 24 months.
Pan Qiusheng, Chairman of Shanghai Jiahua, stated that high-quality products are the core of domestic beauty making a name for themselves. As obtaining traffic becomes increasingly difficult, it is necessary to have highly competitive products and excellent user experiences to enable consumers to be loyal to this brand. Research and innovation are the guarantee of the safety and efficacy of high-quality products. At present, all strategic layouts of Shanghai Jiahua are focused on continuous R&D efforts and the pursuit of quality improvement. According to the first three quarters of 2023 report of Shanghai Jiahua, the company achieved a revenue of 5.091 billion yuan, including research and development expenses of 114.2 million yuan, a year-on-year increase of 8.19%.
At the same time, many domestic beauty brands are constantly striving for brand image innovation. For example, putting effort into brand image building, enhancing brand image and market competitiveness through cooperation with internationally renowned designers and developing co branded products. Launch many products with unique selling points to meet the constantly changing needs of consumers.
"With the continuous improvement of domestic consumers' confidence in local products, local makeup brands are expected to become market leading brands," said Pan Qiusheng. According to data released by Forward Industry Research Institute, the export value of Chinese cosmetics is expected to exceed 5.6 billion US dollars in 2023, and the Chinese cosmetics export market will continue to maintain a growth trend. This also means that the international competitiveness of domestic beauty brands is constantly improving.
Make up for the shortcomings in research and development
As the world's second largest cosmetics market, China's beauty market is developing from a scale of 100 billion yuan to a trillion yuan level, but currently, the share of over 5000 cosmetics companies in China is still limited. In terms of high-end cosmetics raw materials and formulas, the domestic cosmetics industry still needs to strengthen cooperation between the industry and academia, and narrow the gap with foreign manufacturers. At the same time, it cannot be ignored that the development of domestic beauty products in the international market still faces some challenges and needs to improve its own strength.
In 2022, the State Administration for Market Regulation and 18 other departments jointly issued the Action Plan for Further Improving the Quality of Products, Engineering and Services (2022-2025), proposing to promote the cultivation of a number of high-end brands in consumer goods such as cosmetics, clothing, home textiles, and electronic products. In early November 2023, the National Medical Products Administration issued a notice on encouraging innovation and standardized management of new cosmetic raw materials, encouraging the development of new cosmetic raw materials by combining traditional advantageous projects and characteristic plant resources in China, and supporting the use of modern science and technology for research and innovation of cosmetic raw materials.
"Domestic beauty has gradually entered an era of competing for hard power." In Zhuang Xiaojie's view, the cosmetics industry needs to comprehensively plan from positioning, raw materials, production to technological research and development, and focus on innovation to enhance core technologies.
Zhuang Xiaojie stated that the changes in the domestic beauty industry have occurred in the context of consumer upgrading. In recent years, consumers have increasingly recognized domestic beauty products, and the brand value of domestic beauty products has gradually increased. However, in order to gain a share of the mid to high end market and gain a say, it is necessary to improve the level of technological innovation. She suggested improving research and development production equipment, enhancing manufacturing processes, developing new materials, and balancing safety and practicality.
Tian Shaolei, Director of the Inspection Department of the Food and Drug Audit and Inspection Center of the National Medical Products Administration, stated at the 2023 China Cosmetics International Cooperation Forum that the domestic beauty industry should continue to leverage its existing advantages, draw on and absorb advanced international management concepts, standards, and methods, gradually achieve integration with international standards, and improve the quality management and regulatory level of China's cosmetics production, Promote the growth and strength of China's cosmetics enterprises.
Several experts told reporters that although there is a certain gap between domestic cosmetics and international brands, in recent years, domestic cosmetics brands have made significant progress in technology research and development, product innovation, brand building, and other aspects. In the future, through continuous technological research and product innovation, we will improve product quality and attractiveness, launch products that meet market demand, and the gap is expected to gradually narrow. This will also increase consumer awareness and favorability, and occupy more market share in domestic and international markets.
