Datamonitor reveals how brands can cash in on China's 'markets of contrasts'
China, known as one of the top beauty markets in the world was found to be thriving post-recession, a stark contrast to the developed markets, but never-the-less ranked in at third place with $13.8bn in the skincare & makeup segments, behind the US at $17.9bn.
At a recent Beyond Beauty conference in Europe, senior analyst of consumer insights Ramaa Chipalkatti revealed to international industry professionals that following the economic downturn, 47 per cent of Chinese consumers ‘haven't seen or felt any difference' to their lifestyles, as opposed to 23 per cent of US consumers.
And it's inside information like this she says that can be vital in guiding brands on how best to cater to Chinese consumers, something cosmetic veterans such as L’Oreal, Mary Kay, Estee Lauder and Shiseido have seen sense to invest in are already paving the way in the markets as a result.
4 steps to successfully hone in on ‘local customer intelligence’
According to Chipalkatti, there are four key steps that will help brands to hone in on these markets that will ultimately meet consumers where they’re at.
Firstly, the analyst reveals moving away from ‘one size fits all’ as being imperative for success, and gives by way of example Estee Lauder’s work on its ‘Osiao’ brand which was developed to specifically speak to the ‘urban elite’ consumer base with a "made-for-me" product proposition.
She then points to the drastic difference of priorities between the East and West, such as the demand for anti-ageing benefits which was found to be the highest with Chinese consumers at 71 per cent compared to 41 per cent in the US where the priority was more on ‘natural’ / organic ingredients.
Next, Chipalkatti reveals familiarity as being a key ‘pull’ factor for Chinese consumers, with 43 per cent stating that they don’t have enough time to read beauty product labels when shopping, even if they wanted to, and as a result tended to be loyal to the products they previously found to have worked for them.
The expert goes on to explain that other factors such as delivering value for money and using familiar or local ingredients go down well with consumers, with South Korean and Japanese brands such as Kanebo, Missha, and Laneige gaining popularity in the Chinese markets for these exact reasons.