Looking at market entrants, social media news, retail updates, influencer collaborations and also data and reports, LuxePulse is a subscription to quarterly reports that allow businesses to stay up to date about China’s fast-paced luxury market.
By Reuter: Intelligence, the leader in luxury research and insights in China, LuxePulse is an annual subscription. The Luxury Conversation has been given a preview of the latest LuxePulse: Beauty quarterly report – here’s a summary of some of the highlights we discovered, with a short excerpt from a few key sections:
Stats and economic data
Following an uncertain start to 2019, retail sales figures have been growing steadily. 7.2% growth in March was followed by 8.3% in April, and 8.6% in May. Cosmetics were leading retail growth with 16.7%, and e-commerce has been a key growth driver as online sales grew by 21.7%.
So, while the economy continues to stay relatively cooler (i.e. no more double-digit Gross Domestic Product growth), beauty is still a hot ticket item among Chinese consumers – though spending patterns appear to be changing. Online is attracting a growing portion of sales and online sales are fueled by lower tier consumers, not just Tier 1 and Tier 2 shoppers.
During the biggest e-commerce shopping festival of first half of the year, 6.18 (11.11 being the biggest), Apple recorded sales worth RMB100 million in 2 minutes 45 seconds with 170% year-on-year growth for Tier 3 and lower cities. Talking about Chinese luxury consumers specifically, reports by McKinsey, Bain and Boston Consulting Group all predict an increase in domestic Chinesea luxury consumption.
Pop-ups are the flavour of the month (or perhaps of 2019?)
- Armani Beauty’s world-tour pop-up “Armani BOX” opened in Shanghai’s New World Dawan Department Store in mid-June . The launch featured Armani Beauty ambassador Zhong Chuxi and other celebrities, such as actor Zheng Kai (shown in above image). Armani Box has travelled to New York City, London, Paris and others. To coincide with the pop-up, the brand launched its classic 401 lipstick in a special “Shanghai red” packaging. The hashtag #Armanibox has been viewed over 160,000,000 times and mentioned 433,000 times on Weibo.
- L’Oreal set up a pop-up store in Shanghai’s Global Harbor which was launched by Chinese actress Zhang Zifeng in June. The pop-up store focused on the ‘big pink can’ make-up remover. The pop-up store announcement post on Weibo received 177 likes, 75 comments and was reposted 61 times.
- Clé de Peau Beauty launched its “Glory Goddess Plan” pop-up stores in April across seven cities: Nanjing, Changsha, Shenyang, Chengdu, Shanghai, Wuhan, and Nanning.
Social media highlights
Fenty Beauty opened Weibo official account
Fenty Beauty opened its official Weibo account FentyBeautyOfficial on June 17 and by end of June had 14,719 followers. And while not available via bricks-and-mortar stores in China, consumers are able to purchase Fenty Beauty via the social commerce platform RED (Xiaohongshu).
King of live-streaming Li Jiaqi x Gucci
Li Jiaqi posted a video review about Gucci’s new lipstick collection Rouge à Lèvres Voile Lipstick, which was viewed 2,300,000 times. The video has been liked 12,300 times, reposted 865 times, and attracted 1,500 comments to date.
Guerlain’s O2O membership push
In early June, Guerlain ran a campaign to attract more members to its premium membership program Ming Lan Hui. During the campaign drive, members received double points and even full-size products for offline store purchases. Members scan the in-store QR code to access the Membership Mini-Program on WeChat in order to manage their member credits and claim benefits.
Biotherm’s free product trial on Sephora WeChat Mini-Program
Biotherm launched a free product trial campaign on WeChat to promote its Men’s Aqua Facial Essence. Customers could redeem sample products by filling in their delivery information within the Sephora WeChat Mini-Program.
Recent brand collaborations
White Rabbit x Scent Library
China’s Scent Library and the White Rabbit candy company have partnered on a range of White Rabbit candy scented products launched on May 22. The products include shampoo, shower cream, perfume, hand cream, body lotion, car fragrance, pouches and more. The keyword “White Rabbit perfume” has been mentioned 1,751 times on RED.
Perfect Diary x The Met
Local beauty brand Perfect Diary has launched a lipstick collaboration with The Met, featuring Zhu Zengting from the boy band Nine Percent on June 4. The Weibo hashtag “Perfect Diary The Met Lipstick” has been viewed 130,000,000 times and mentioned 116,000 times on Weibo.
Rise of C-beauty
According to Euromonitor, L’Oreal holds the largest share of the USD62 billion beauty market in China at 36%. While it may be that international brands still dominate the market, a number of domestic players are worthy of noting.
There are three Chinese brands in the top 10 biggest beauty brands in the country, namely Pechoin, Chando and Kans. While another four local brands Yunnan Baiyao, One-Leaf, Beautrio, Perfect Diary, and Proya make it in to the top 30. Herborist and Inoherb, while not topping the lists, are anecdotally increasingly popular.
Meanwhile, Japanese beauty brands are going from strength to strength. For example, for Japanese cosmetics conglomerate Shiseido, China made up 17.4% of its overall sales, an increase from 14.4% the year before.
However, South Korean cosmetics are seeing an overall drop in sales. While beauty exports to China are still growing by 20%, it is nowhere near the 66% annual growth seen over the past five years.
Some put this trend on Chinese disinterest in the one-size-fits-all aesthetic to embrace individual looks promoted by South Korean popular culture.