Premium Beauty and Personal Care in Indonesia

PRE-COVID-19 PERFORMANCE

Higher import taxes result in muted current value growth in 2019

The dynamic double-digit annual current value growth seen for premium beauty and personal care for much of the review period came to an abrupt halt in 2019, with the year seeing only muted growth. This was due to the impact of higher import taxes, which were imposed in September 2018.

K-beauty trend continues to offer a boost for premium skin care in 2019

The K-beauty trend remained strong in 2019, with this encouraging many consumers to use more steps in their skin care regimes and also to invest in premium skin care in the hope of boosting skin health and avoiding premature ageing. Premium skin care saw strong double-digit current value growth in 2019 and accounted for over a quarter of overall value sales.

Focus on skin care benefits boosts interest in a number of premium categories in 2019

Consumers’ increasingly sophisticated understanding of skin care ingredients and benefits not only impacted premium skin care in 2019 but also encouraged many consumers to trade up to premium products in many areas of beauty and personal care. The tiny niche of premium baby and child-specific products in particular saw striking triple-digit current value growth in 2019, as parents proved willing to invest in premium products for their children, particularly those with a natural positioning and offering skin care benefits.

2020 AND BEYOND

COVID-19 impact

Sales of premium beauty and personal care are expected to decline by 1% in 2020 in 2019 constant value terms in light of the impact of COVID-19.

Affected products within premium beauty and personal care

While the overall impact of the COVID-19 pandemic is expected to be negative for premium beauty and personal care, there will be a highly divergent performance across the different categories. The home seclusion trend is expected to have a heavy negative impact on premium colour cosmetics, deodorants and fragrances, with many seeing little need to use these products while at home.

Recovery and opportunities

Premium beauty and personal care was hit hard in 2019 by soaring import tariffs and will be impacted by the COVID-19 pandemic in 2020. Despite these challenges, sales will return to value growth at constant 2019 prices from 2021, with growth rates steadily increasing as the forecast period progresses.

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