The Future of Skin Care: Game-changing Trends and Influencers

Strategy Briefing

About This Report

Jun 2015

Skin care remains the key revenue driver in beauty with global sales exceeding US$111 billion in 2014. Beyond China, Indonesia and India will be key growth markets by 2019. Demand and innovation are driven by multiple factors. On one hand, technology gives rise to devices and diagnostic tools, changing the consumer beauty experience, while on the other, niche brands and Asianification revive categories such as face masks and facial moisturisers marking a new turning point for the market.

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The Future of Skin Care: Game-changing Trends and Influencers

Skin care continues to be beauty’s most valuable category

With global value sales expected to exceed US$131 billion in 2019, skin care will remain beauty’s biggest category adding some US$20.1 billion to its value over 2014- 2019. This will be mainly driven by emerging markets in Asia Pacific including China which will account for nearly 60% of skin care’s absolute value growth by 2019.

Indonesia, India and Turkey emerge as key growth markets

Indonesia will become the second largest contributor to skin care’s absolute growth replacing the US in third, while India will follow South Korea and rise to become the fifth largest market in absolute growth terms. Indonesia and India together will add over US$2 billion to skin care by 2019. Turkey remains a major growth engine in Western Europe as increasing marketing activity by beauty players will boost skin care’s value in the market.

Technology impacts innovation and customer experience

Technology’s influence in skin care has been twofold. Firstly, it is influencing innovation through the rise of beauty devices, new ingredients and new technologies such as 3D printers which can change the manufacturing process. Secondly, customer interaction and experience through the use of diagnostic tools and digital apps as well as payments and delivery are the other areas that are transforming rapidly.

Niche brands shake up the competitive landscape

In 2014, fast-growing niche brands climbed the rankings leading to various acquisitions by large multinationals. Consumers’ desire for high-efficacy skin care has helped niche brands flourish in a crowed space as they are viewed as specialists in their field. This trend was most notable in the US.

Asianification: the growing influence of Asia in skin care

Asia Pacific remains the most important region in both value terms and as the key origin for skin care trends. The introduction of novel products such as essence and emulsion, the revival of skin care categories such as face masks, and the expansion of Asian brands to the West are shifting the balance between East and West.

Introduction

Scope
Key findings

Global Overview

Skin care growth bounces back in 2014
Skin care rules in beauty across most regions
Asia Pacific domination unrivalled in skin care
The top 10 markets hold majority of skin care’s value share
The IIT markets in skin care: Indonesia, India and Turkey
Mass-market growth more resilient than premium globally …
…but premium skin care growth stronger across key markets
Body care remains in the shadow of facial care

Key Industry Drivers

Skin care remains the highest spend category in beauty
Fastest growing brands reveal key trends
Skin care’s four growth pillars give the industry a new dimension

Key Industry Drivers: Technology

Technology inspires skin care in four distinct ways
Devices: Skin care category of the future
Bespoke skin care boosted by technological advances
Technology influences consumer experience
Technology changes payment and delivery of skin care offerings

Key Industry Drivers: Niche Brands

Niche brands dominate growth in mass skin care…
…and even more so in premium skin care
“Hero” product gives niche brands the competitive edge
The US - a thriving market for niche brands?

Key Industry Drivers: Asianification

Asianification stimulates innovation in skin care
Fastest growing skin care companies come from Asia
Korean wave makes a slow but steady move westwards
Asia influences skin care benefits and claims
Asia revives skin care’s stagnant categories: Facial moisturisers
Face masks’ resurgence in the West and China’s supremacy
Can facial cleansers benefit from Asianification ?

Key Industry Drivers: Natural Skin Care

Natural/organic skin care continues to capture consumers
Natural - a premium opportunity in India, Indonesia and China
Could India, Indonesia and China be premium natural skin care markets?
Natural claims alone are not enough to win consumers over
Changes in animal testing regulations shake up the market
Natural’s biggest challenge remains regulation

Future Prospects

Innovation and capturing new consumers remain key focus
Face masks and anti-agers to define future growth potential
If men’s skin care could reach 1/10 of women's skin care
India and Indonesia to reinforce Asia’s dominance further
Latest trends to shape the future face of skin care

Report Definitions

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