Premium Beauty and Personal Care in Vietnam

PROSPECTS

Improved economy drives demand for premium brands

According to the General Statistic Office, Vietnam’s GDP is expected to continue seeing strong growth. The increasingly strong economy in 2018 prompted more consumers to spend money on travelling, apparel and beauty and personal care products, even on premium brands well.

Premium colour cosmetics experiences the fastest value growth

Amongst beauty and personal care, premium colour cosmetics saw the strongest growth rate in both value and volume as use of colour cosmetics increased significantly, especially amongst the younger generation in 2018. During the review period, strong penetration of Western and Korean culture through social networks and media played an important role in driving awareness of how to choose and use make-up effectively.

Forecast period promises continuation of premium growth trend

Over the forecast period, the Vietnamese economy is expected to continue seeing high GDP growth, and this can only help boost value sales of premium brands in these coming years. Movement towards premium products is expected to increase, especially amongst customers living in big cities like Hanoi and Ho Chi Minh and premium colour cosmetics is expected to continue driving value sales.

COMPETITIVE LANDSCAPE

Shiseido Vietnam continues to lead

In 2018, Shiseido Vietnam was the leading player within premium beauty and personal care, largely on the strength of its leadership one of its biggest categories, skin care, where it offers various product types with multiple functions. Although Shiseido has lost value share to other premium brands like Estée Lauder, Nu Skin and/or L’Oréal in various categories within the last few years, it has started to strengthen its performance by focussing on developing and launching new products.

Prestige brands dominate premium market

In 2018, prestige brands continued to dominate premium beauty and personal care, accounting for more than 90% of the total sales value, leaving little room for pharma brands like Avene, La Roche Posay and Vichy. It was mainly thanks to these companies’ major efforts to expand their distribution networks and to their reputation for quality.

Pharma brands to see increased demand

Over the forecast period, prestige brands should continue to outperform pharma ones mainly due to having wider distribution. However, as health and wellness concerns related to increased air pollution and exposure to UV rays are intensify, demand for pharma products is expected to increase as well, as these brands have a wide range of product types that specifically address such concerns.

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