|The sales of cosmetics products in China hit $21.94 billion in 2012, according to a report. Geng Guoqing / For China Daily|
Money may not buy happiness but, when it comes to the beauty enhancement department, it sure can help. In China, it appears that as the GDP grows, so does the appetite for cosmetics.
Reportlinker, a company that provides industry reports, company profiles and market statistics published by private and public organizations, recently released the China Cosmetics Industry Report 2013-16, which tracks how the health of the economy is reflected in beauty consumer trends.
The growth of China's cosmetics industry, which includes skin care, makeup, perfume, men's cosmetics and babycare products, has been stunted because of the combined effects of the global economic turmoil and the slowdown in China's economic growth, with gross retail sales at $21.94 billion, according to the report.
In comparison, China saw rapid growth in the cosmetics market in past years. In 2010, sales of beauty and personal care products stood at $24 billion, more than triple what it was just 10 years before that, according to a Cosmoprof-Asia article published in July.
Foreign brands are still the dominant players in China's cosmetics market, with the top three — L'Oreal Paris, Olay and Mary Kay — collectively accounting for 12.45 percent of retail sales, according to the Reportlinker report.
L'Oreal is the world's largest cosmetics company. It has managed to maintain stable business growth since entering the Chinese market in 1997, according to the report. As of late 2012, the company was running 20 brands in China, including L'Oreal Paris, Maybelline and other well-known names, as its sales in China grew 12.4 percent year-on-year to nearly $2 billion.
L'Oreal is banking on lotions using traditional Chinese herbal remedies and also products targeted at China's fast-growing men's cosmetics market, according to a Businessweek article published in March.
Among the company's latest products tailored to the Chinese market are a cosmetic balm for Chinese men looking to mask face blemishes and skin serum products made with traditional herbal ingredients, according to Businessweek.
Skin care products are the largest cosmetics category in China, the Reportlinker report said. Its market size in 2012 hit $13 billion, up 9.9 percent year-on-year.
Among skin care products, the report said cream and anti-aging products are the most popular, with sales standing at above 60 percent in the China skin care product market.
"Chinese women are developing more sophisticated routines," Lui Meng Chow, a Mintel research analyst, said in the company's Facial Skincare China July 2013 report.
"Even though the facial skincare market is mature, there are still gaps that exist between customers' needs and the products that are currently available," Chow said. "Diversification therefore offers an opportunity for domestic small brands and new players in the market, who were initially being squeezed by the sway of foreign giants."
Chow said the impact of rising incomes and increased skin care concerns in China has seen the facial care industry move its focus from providing simple facial care to include products that deliver on specialized facial care treatment.
The analyst said that products with natural ingredients and carrying "zero-burden" claims, such as additive-free products, are favored by customers, following a flurry of product safety scandals.
As for the makeup market, the report said the sector started late, but has developed rapidly with sales in 2012 grossing $3.8 billion, a year-on-year rise of about 20 percent.