China’s US$40 billion skincare market thrives as consumers turn to value-for-money brands
Local brands dominate skincare sales in China as consumers switch to value-for-money names from luxury icons
Last May, media communications professional Stephanie Sam spent 4,000 yuan (US$562) on skincare, lured by online sales. On average she spends at least 1,000 yuan on quality skincare – her top priority compared with other beauty areas like make-up and hair care.
“I pretty much have the whole range, from retinol to Vitamin C serums, hyaluronic acids to sun-protection lotions,” she said. “They at least have scientific research behind their products and can be found at mid-range price points, so I don’t feel like I’m breaking the bank.”
Cosmetics manufacturers are stepping up their game as consumers in China get more sophisticated and discerning about quality. It is a trend they cannot afford to ignore; the US$40 billion market for skincare products is projected to reach US$44 billion by 2027, according to researchers at Euromonitor International.
E-commerce generates more than 40 per cent of the market currently, and the ratio is projected to reach 60 per cent by 2027, according to BDA Partners.
Chinese consumers “do their research, they are very rational and practical”, said Betty Kim-English, deputy general manager of global marketing for skincare brand Drunk Elephant. “They are sophisticated, and they are looking for high performance, premium skincare.”
The Houston-based company, owned by Japanese giant Shiseido, launched its eponymous brand in China across Sephora’s 250 bricks-and-mortar stores in April. Its presence dates back to 2019, when its biocompatible products were first sold through Tmall, a cross-border e-commerce platform operated by Alibaba Group Holding.
