Once China’s fastest-growing cosmetics brand, Perfect Diary saw a significant decline as the competition in the market intensified.
At the same time, the brand criticised by consumers for prioritising investments in marketing over product quality.
Since then, brand owner Yatsen Holdings have steadily increased investments into R&D over the years.
This strategic transformation led to the development of the Biolip Essence Lipstick, a successful product that helped to reinvigorate interest in the brand and highlight its R&D capabilities.
In the fourth quarter of 2024, Perfect Diary continued to make significant strides that were attributed to the launch of the second-generation release of the Biolip Essence Lipstick.
According to Yatsen, the lipsticks were the brand’s top performers, achieving leading positions in the 11.11 sales rankings across several platforms.
Additionally, the product has also received international recognitions, including the MUSE Design Award and the French Design Award.
“We are very encouraged by lipstick’s success, and we leveraged the consumer insights and professional expertise gained during its development to create more exceptional products,” said Huang Jinfeng, founder, chairman, and chief executive officer of Yatsen Holdings.
By channel, the brand was driven by revenue growth on the Douyin while also increasing its revenue contribution from offline distribution channels.
Driven by the recovery of Perfect Diary, Yatsen’s colour cosmetics revenues were up 16.4% for the quarter.
This helped to minimise losses for the full year, which total colour cosmetics revenue declining slightly by 0.3%.
Huang emphasised that scientific innovation was crucial to the company’s growth, highlighting his confidence in Perfect Diary’s position moving forward.
“Scientific innovation remains a key driver in the growth of both our skin care and colour cosmetics brands. Our R&D expenses represented 3.2% of total net revenues for the full-year 2024, underscoring our commitment to innovation and product development,” said Huang.
“We’ve already demonstrated the transformation for Perfect Diary has gained a tremendous outcome. And then looking forward, the high growth, high repeat purchase, and the very competitive products will contribute to a more sustainable growth for our makeup category.”
Skin care continues to grow
In addition to strengthening its colour cosmetics brands, the company expanded its skin care business in an attempt to balance its portfolio.
In 2024, its skin care lineup, which includes Galénic, Eve Lom, and Dr. WU, accounted for 41.1% of the firm’s total net revenue.
In particular, Galénic had a strong year.
“Galenic continued to deliver solid performance throughout the year, driven by its strong brand equity, effective products, and scientific communication. The brand maintained a leading market position of its iconic number one VC serum while launching the number two VA serum,” said Huang.
“These initiatives received broad industry and consumer acclaim as evidenced by Galenic winning the beauty of the year award from Vogue and Elle for its remarkable contributions to skincare innovation.”
Yatsen skin care revenues grew by 0.7% in 2024. For the full-year 2024, total net revenues declined by 0.6% year over year, which Huang said signalled “stability”.
“Although there is still work ahead, these positive outcomes demonstrated that our strategic transformation is on the right path. Our key initiatives under this plan were designed to bolster our brand portfolio and strengthen each brand to holistically drive sustainable growth.”
