Domestic domination: Research reveals local beauty brands now make up 56% of market in China

By Amanda Lim contact

- Last updated on GMT

Local beauty brands are now occupying more than half of China’s cosmetics market, suggesting that these homegrown players are ready to tackle international labels. ©GettyImages
Local beauty brands are now occupying more than half of China’s cosmetics market, suggesting that these homegrown players are ready to tackle international labels. ©GettyImages
Local beauty brands are now occupying more than half of China’s cosmetics market, suggesting that these homegrown players are ready to tackle international labels.

The 2019 National Beauty Report by Tencent Holdings and Kantar Group, found that 42% of beauty consumers are more willing to choose local over foreign brands, while almost 90% of respondents said they were likely to repurchase products from a local brand.      

The beginning of the C-beauty era?

The perception of C-beauty companies in the local beauty market has made a phenomenal transformation. Interestingly, the report noted that price was not the only advantage domestic brands had over the foreign ones.

In fact, consumers that reported price as the key reason for choosing a local brand dropped from 48% in 2007 to 26% in 2018.

However, some budget-conscious consumers choose to support local brands as a ‘value-for-money’ alternative to international brands.

Additionally, the reported stated that consumers are less influenced by the brand’s country of origin. Instead, they now evaluate factors such as effectiveness, cost-effectiveness and reviews.

C-beauty also attracts Chinese consumers for a variety of reasons such as trust, quality as well as unique Chinese style and ingredients. These qualities are boosted by innovative storytelling, strong localised marketing, the influence of KOLs as well as attractive brand collaborations.

The growth of C-beauty brands is most visible in the local skin care market.

According to the report, six out of 10 of the top chosen skin care brands in China are domestic brands.

Pechoin topped the list, beating out international brands like L’Oreal Paris, Nivea and Olay, for a third consecutive year with over 100m votes. Other C-beauty brands that made the list included, Inoherb, Kans, One Leaf, Chando and Wetcode.

“We could see that Chinese born brands are on a strong rise with massive growth potential. Consumers have changed their perception towards Chinese beauty brands thanks to qualified products, strong word-of-mouth endorsement and real value,”​ said the report.

It added that these brands managed to achieve strong growth and maintain their market dominance because of their drive to innovate in terms of product concepts and technologies.

They have also leveraged the omnichannel approach to appeal to the important millennial and gen Z demographics. And lastly, they are able to respond quickly and adapt to the rapidly changing consumer trends.          

Opportunities in the market

China’s beauty market is fast-emerging and there are multiple opportunities available for a brand to expand and achieve growth.

Local brands such as Proya, Perfect Diary, Meiking, Sealuxe and iLife are among the Chinese brands recoding the fastest growth in the market, said Kantar.

In order to continue their growth momentum, brands need to invest in developing strong products as well as brand image.

This would include putting resources into cultivating a strong social media presence on platforms such as WeChat, Xiao Hong Shu and Weibo, to reach and engage with more consumers.

In a rapidly changing market like beauty in China, brands will also need to be agile enough to develop and launch new products to meet the constantly evolving needs of the Chinese beauty consumer.

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