Chloé Reuter, Founder & CEO of Reuter Communications, and expert in all things Chinese, has uncovered the key issues that are influencing the country’s beauty market.
“China specialises in big numbers, and beauty is no different. In 2018 the total spend of China’s 220 million millennials on beauty products exceeded $77 billion*, a +7% increase from the year before.”
As with most luxury categories, a current key driver for growth in the beauty sector are younger consumers. Young, curious and engaged consumers seek novelty; whether it’s through trying new niche brands or new categories.
So we know about the demand. But what is driving their preferences and behaviour? Where are they finding the information? How do they buy? What do they look for? Most importantly, how can brands make sure they are top of mind in this hugely competitive market?
“The new face of beauty in China” seeks to answer these questions. Our research, conducted by our insights and data division, Reuter: Intelligence, included focus groups, mobile ethnographies, big data analytics and a quantitative online survey covering over 300 consumers across the first-tier cities of Shanghai, Beijing and Guangzhou.
The insights we discovered are a must-read for any brand that values a seat at the table of the ever-changing Chinese beauty market. Here are 4 key takeaways.
1. Continue to invest in WeChat, experiment on Red Book
WeChat should still be the engine for driving brands’ digital activity in China, but now is the time for strategic experimentation on Red Book. While the rules of the platform are frequently updated to avoid overly commercial content, Red Book is growing to become Chinese consumers’ go-to-platform for learning, browsing and related influencer content. For brands, an official account on the platform or collaboration with a relevant blogger should now be a priority.
2. They all want Organics
Independent of gender, ages or stage of life, “organic” and “natural” are the keywords Chinese beauty consumers are looking for. Respondents also showed a clear willingness to pay a higher price if they believed the product fits these criteria. Beauty brands should make note of this trend for future product development.
3. Niche is on the rise: dare to be different!
With Chinese consumers being ultra-knowledgeable and well-versed in luxury, niche is popular in many forms of their lifestyles, beauty included. The modern generation of Chinese consumers are keen to seek out niche beauty; which should be a clear message for beauty brands to push their boundaries further when it comes to packaging, marketing or the product itself.
4. Beauty stays above the influencer bubble
Today, China’s sophisticated consumers are often looking for more depth and more authentic influencers; and beauty’s obvious visual aspect is closely related and subject to the power of influencers. Yet, it’s not solely about the look anymore, with followers looking for highly detailed reviews and tutorials – beyond recommendations that merely skim the surface. The challenge with the growth of beauty influencers means finding genuine ones is more difficult than ever before. From now on, working with the right expert agency who can vet potential candidates and just manage them will be a must.
There is no stopping China’s beauty industry transformation. From the products themselves to the way they are marketed, these changes have penetrated all areas of the beauty industry.
To be successful, brands must adapt to an ever-changing market, where stakeholders’ roles have changed and the “best practices manual” hasn’t yet been written.”