Premium Beauty and Personal Care in Hong Kong, China

PROSPECTS

Consumers seek quality beauty and personal care products

Premium beauty and personal care enjoyed strong sales growth in 2018 with premium skin care being the category’s mainstay, followed by premium colour cosmetics. Premium BB/CC creams was the most dynamic category in premium beauty and personal care in 2018 as consumers are increasingly adopting products with multiple properties such as make-up coverage, moisturising and often even some degree of sun protection.

Improved transport links with Mainland China boost sales from incoming visitors

Over the forecast period, the inflow of Mainland Chinese to Hong Kong is expected to increase further, thanks to the Hong Kong-Zhuhai-Macau Bridge and Hong Kong high-speed rail link. Many new shopping centres are expected to be built in Hong Kong to cater to such consumers, who often visit the city specifically to buy premium beauty and personal care products, particularly premium skin care, fragrances and colour cosmetics.

More “affordable” premium products attract a wider audience

Affordable premium products such as facial moisturisers from Korean brands such as Laneíge and dermocosmetics brands such as La Roche-Posay, meet demand from the middle-classes for a luxury experience. This contributes to the ongoing dominance of premium products in value share over mass products in certain categories, particularly colour cosmetics, fragrances, sun care, men’s skin care and men’s fragrances.

COMPETITIVE LANDSCAPE

L’Oréal and Estée Lauder sales grow thanks to strong premium portfolios

Global beauty giants L’Oréal and Estée Lauder made further headway in premium beauty and personal care in 2018, with each registering strong year-on-year retail value sales growth. The success of the leading companies derives from their portfolio balance between skin care and colour cosmetics.

Industry players increasingly communicate via social media

While internet retailing remained a small channel for beauty and personal care products in 2018, younger consumers, especially millennials, are increasingly being influenced by social media. Premium beauty and personal care manufacturers are tapping into the popularity of social media by developing new strategies to communicate with these consumers.

Personalisation and novel fragrances in demand

Premium beauty and personal care is also benefiting from the rise in popularity of niche brands often from smaller less well-known manufacturers. This is particularly true in fragrances given the vast proliferation of brands and scents.

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