In a continent like Asia, where image matters so much, the cosmetics market is always profitable. Especially in China, which is the second largest market in the world in this sector after the United States.
The Organic Cosmetics market
This market is expected to exceed 50 billion dollars by 2050, according to Mintel’s predictions. More than a label, “organic” has become a worldwide trend. While the success of organic beauty products has been particularly successful in North America and Europe, this market is beginning to make its way into Asia. According to a survey, the Chinese are mainly concerned about the efficacy of the product (66%), the brand (64%) and reputation, word-of-mouth (60%). This last point is particularly important for young consumers, as well as the price. But for mature respondents, the quality of the products and their ingredients will prevail. For example, natural products are particularly popular and the organic cosmetics market is growing. But the concept of “organic” is not yet fully understood in China.
Although consumers are attracted to this label, the term is not as well interpreted as in the West, especially because they have no real equivalent in China. For Chinese, to adopt a more natural lifestyle would be to simply eat more fruits and vegetables. So there is still a lot of work to do in this market and foreign brands can play a big role in it. They already represent 60% of cosmetics sold in China. The most popular targets in this area are the “post-80s and post-90s generations” because they always keep up with the latest trends and care a lot about their look. The most effective way to approach them is to find them where they spend most of their time: social networks. This generation likes to follow the news of influential people, such as actresses, singers or beauty bloggers. One way to gain a lot of visibility from this audience is to collaborate with these influencers, the KOL.
Why bet on organic cosmetics in China?
The cosmetics market in China has grown very quickly during those last ten years. Its growth is stable and the market remains promising. Indeed, the knowledge of the Chinese toward the different virtues of organic is still insufficient, but they are getting better, as their interest in those products. Actually, the “green” side of these products is attractive to the Chinese because they are very receptive to all notions related to nature. In traditional Chinese philosophy, the environment is perceived as an entire balance that must be maintained. Their culture thus gives them an interesting approach to the environment, as well as a deep respect for nature (very important in traditional Chinese medicine for example). In addition, scandals related to poor hygiene and health problems are not uncommon in China. This kind of natural product is therefore more reassuring for them.
Moreover, the new generation of Chinese has changed, as well as their consumption habits. Young city-dwellers asserted themselves, and they are now more and more open to Western trends, which was not the case for previous generations. Young workers are also freer than before in their purchasing decisions, they are more independent. In addition, their purchasing power is getting higher since a younger age. They are also less reluctant than their parents to spend large amount of money on products of quality. Furthermore, the share of the budget devoted to physical appearance is rather high, because they consider these expenses as the third most important (after accommodation and food).
How to conquer this market?
Being present on social networks
Since the urbanization of the country, the Chinese are heavily exposed to advertising and the presence of foreign brands, especially in big malls. However, the biggest influence in their buying decision is online, in order to always keep up with the latest trends. For example, the article of a beauty blogger is going to be more efficient than a billboard. It is therefore very important to be present on social networks (WeChat, Weibo, blogs, KOLs) and specialized mobile applications, because their influence is growing bigger.
In addition, the Chinese like to share their dailies on different applications and networks. They also grant great importance to the opinion of those around them and always want to look good. The opinions of their friends can even be decisive in the buying process, because they will tend to want to do like everyone else. The concept of trust with a brand is also essential to Chinese, which is why they will buy a product recommended by a friend or a blogger more easily than if they saw it in a simple advertisement.
Beauty products are the most popular products online, even before handbags, shoes and clothes. Being online is a very widespread consumer habit in China because their market digitalized itself a lot and it is also very convenient for them as they have very busy schedule. This allows them to save time, get home delivery, but also to have a much wider choice of products. This kind of B2C e-commerce also gives them visibility on some foreign brands that it could not find in shopping malls.
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