Premium Beauty and Personal Care in Indonesia

PROSPECTS

Premium skin care sees the highest sales, which is expected to continue

Due to the K-beauty trend, premium skin care products were very popular during 2018. Consumers were willing to add more steps to their beauty routine and pay more to get good-quality skin care products, since they believed it would help them to prevent poor skin health and premature ageing.

The strongest growth is seen by smaller categories

Hair care saw the strongest current value growth within premium beauty and personal care in 2018. This was partly due to its low base.

Growth is expected for premium sun care

Although the majority of share in sun care is held by mass brands, a bright future is expected for premium sun care. Consumers are becoming more aware of and concerned about UV rays, and it is likely that they will try innovative sun care products, which are more likely to be categorised as premium.

COMPETITIVE LANDSCAPE

Premium brands use KOL as their primary marketing strategy

Key opinion leader (KOL) is the professional name that is given to beauty influencers and vloggers. Promoting their products through KOL has become the primary marketing strategy for premium beauty and personal care brands.

Consumers are willing to pay more for premium beauty and personal care products

The rise of financial start-ups which offer micro-loans has led consumers to have higher purchasing power by paying in instalments. Akulaku and Kredivo, two of the most popular financial start-ups in Indonesia which offer micro-loans, have stated that the majority of borrowing is by women, for the purpose of buying premium beauty and personal care products, particularly skin care products.

A new tax regulation for imported goods

In the middle of 2018, the government imposed a new tax tariff on imported goods. For beauty and personal care, the new tariff is four times higher than the original tariff.

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