Market Trends of China Cosmetic Products Industry
Rising Demand for Natural and Clean-Label Cosmetic Products
- Asian consumers are increasingly demanding natural cosmetics products, and China is no exception. Consumers are demanding natural and clean-label products due to their high quality and the presence of fewer or no harmful ingredients. They are also demanding herbal beauty ingredients attributed to overall health and skin benefits. Many local brands are incorporating them into their product formulations, thereby supporting demand for natural cosmetics products.
- Furthermore, consumers are demanding vegan, clean-label, organic, 100% plant-derived, non-genetically modified organisms (GMO), and very minimally processed beauty products. Also, sustainability is the new topic of discussion these days wherein companies are introducing novel sustainable products that are less harmful to the environment and consumers and are welcomed wholeheartedly by consumers.
- Furthermore, companies are investing their resources to launch sustainable packaging in natural cosmetics products, further supporting the demand for natural and clean-label cosmetics products in the Chinese market.
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Online Retail Stores are the Fastest Growing Distribution Channel
- The lack of brand diversity and limited access to retail stores is increasing the popularity of online retail stores in China. Also, the sales in cross-border channels, such as shipping directly rather than traditional brick-and-mortar storefronts, are leading to a surge in sales via online distribution channels.
- Consumers in China spend a significant amount of time reviewing products online and often make purchasing decisions based on recommendations from family and friends. These factors have been supporting the growth via online sales channels.
- Furthermore, e-commerce platforms in China increasingly influence consumer purchases by providing a platform for the beauty community to share shopping and product experiences. Among online channels, live streaming has rapidly grown into a major sales platform for cosmetics, often marketed to smartphone-savvy consumers who shop via this method.
- Livestreaming has almost doubled its market share from 2019 to 2020. As per the International Trade Administration (ITA), it now makes up roughly 10% of Chinese e-commerce, which will be an integral part of any successful multi-channel sales strategy.
