Super Premium Beauty and Personal Care in China

PROSPECTS

Younger consumers show strong demand for efficacy

Younger Chinese consumers have considerable knowledge about luxury beauty brands and clear opinions about the products that they prefer, supported by social media. Moving on from the idea that consumers should purchase the products that suit their age, younger Chinese consumers are strongly focused on product efficacy and an affinity with the brand.

Gen Z shows stronger focus on self-expression than previous generations

Millennials represent the key consumer group in super premium beauty and personal care, with Gen Z consumers also emerging as an important driver of luxury consumption, especially in beauty products. As Gen Z consumers mature and pursue careers, their increased purchasing power and more public lifestyles are creating demand for super premium beauty and personal care products.

Increasing emphasis on sustainability

Sustainability has become a growing issue within the retailing of super premium beauty and personal care products in China, with the idea of reducing the industry’s negative environmental impact. In June 2018, L’Oréal’s Chief Executive Officer agreed a partnership with Alibaba Group, signing a "Green New Retail" document in the Great Hall of the People in Beijing, witnessed by Chinese Prime Minister Li Keqiang, and French Prime Minister, Edward Philip.

COMPETITIVE LANDSCAPE

Pop-up stores become a prominent way to generate consumer interest

Pop-up stores are becoming a prominent feature of super premium beauty and personal care players’ efforts to target young Chinese consumers, especially females. L’Oréal (China) Co Ltd’s Giorgio Armani brand signed the pop star, Jackson Wang, as an ambassador for its fragrances in 2019, leading to the Armani Si Passione fragrance selling out within 24 hours.

Colour cosmetics an important entry point for luxury brands

While it might be difficult for younger consumers to save up for luxury items such as handbags, super premium beauty and personal care products such as luxury lipsticks are considerably more affordable. As a result, luxury brands such as Chanel and Yves Saint Laurent treat colour cosmetics as important gateway products to reach Chinese consumers and build a relationship with them.

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