BEYOND BEAUTY
INDUSTRY NEWS
Under the skin of beauty
by Claudia Bonfiglioli, Informa Markets Beauty Division
Even in economic slowdowns, some sectors seem to defy gravity. The beauty sector is certainly one: between 2016 and 2022, projections suggest it will generate business worth nearly $430 billion globally, at an annual rate of over 4%.
Suitably enough in an industry that thrives on trends, the landscape for retail and professional beauty products evolves by the year.
Gen Z: the new faces of beauty
There are now as many Gen Z consumers born from 1995 onwards
than millennials, and they account for around one-third of the
global population.
Gen Z-ers are also digital natives, driven and informed by the
relationships they have with social media and consciously living
double lives, using a filtered and sometimes fabricated persona
online. In a survey of China’s booming wanghong economy, more
than half of Gen Z-ers chose livestreamer as their dream job.
When it comes to beauty, the “we” generation of consumer has
quickly evolved into the “me” generation, and is demanding unique
rather than mass market brands that cater to them as individuals.
This is creating a revolution in brands and distribution and
provoking a search to find ever-more creative and innovative
concepts, materials, ingredients, laboratories and packaging to
inspire the new generation of consumers.
Innovation through Sustainability
For the beauty sector, we see key territories being China, the US, India and Indonesia, where Gen Z-ers will rapidly become the largest spending groups and major brands need to find creative ways to capture them.
One of those ways is through harnessing increased interest in sustainability. Where ten years ago natural and organic qualities were key drivers, today ethics have joined them centre-stage.
In Asia, where most of the world’s 1.8bn Muslims reside, the
greatest potential may lie in halal-approved beauty products:
essentially, products free of animal derivates or alcohol.
Recently the Indonesian government announced it would introduce mandatory halal labelling of cosmetics and personal care products. Where previously ethical labelling was typically a voluntary action, beauty brands may now have to take a certification route.
China: beautiful opportunities
China’s reputation as the world’s beauty factory only tells part
of the story. It is also the number one target audience for many
beauty marketers, and its status is evolving as a major beauty
conceptualiser and developer. Local brands have invested in stateof-the-art development laboratories, hired internationally and are
harnessing new and ingredients as they pursue safe, sustainable
and, very soon, cruelty-free products.
After the K-Beauty movement in Korea and Japan’s upcoming
J-Beauty segment, C-Beauty is also rising fast. It speaks to a young
and vast Gen-Z population that is proudly Chinese and looking for
the very best in locally-generated beauty and fashion, and willing to
spend on products they deem worthy.
It is a rich prize indeed: the market is worth nearly $60bn, up 23%
compared to the prior year, with nearly 50% spent in direct and
speciality stores. Non-traditional channels are also key in this
sector: advanced technology, such as virtual reality and artificial
intelligence is creating a new shopping environment and narrowing
the gap with traditional physical services at the beauty counter.
Indeed, physical retail is facing challenges due to competition
with online sales, which can reach two million pieces sold per
month. Competition between foreign products and local brands is
also hotting up as importers select an ever-increasing amount of
international products that are unique in the Chinese market.