[Conference Exclusive] 2017 China Cosmetic Market Data Analysis and Predictions

During Sep. 19th -22nd 2017, the China Association of Fragrance Flavor and Cosmetic Industries (CAFFCI) held its annual conference during which market, regulatory trends and forecasts were revealed. Cosmetic sale growth rate shows an optimistic rise in 2017, statistic analyst predict an expansion of CNY 152 billion over the next 5 years. Statistic from GFK manifested in H1 2017...

Takehome:

During Sep. 19th -22nd 2017, the China Association of Fragrance Flavor and Cosmetic Industries (CAFFCI) held its annual conference during which market, regulatory trends and forecasts were revealed.
Cosmetic sale growth rate shows an optimistic rise in 2017, statistical analysis predicts an expansion of CNY 152 billion over the next 5 years.

Statistics from GFK in H1 2017, show the total value of cosmetic retail sale in China reached CNY 120.3 billion, which surpassed the 11.3% H1 in 2016. The growth rate was even higher than total growth rate of consumer goods.

The tendency of China cosmetic growth rate is:

Generally dividing cosmetics into daily care and make-ups products, the sale of daily care products occupies the majority, but the sale of make-ups grew faster:

In 2017, traditional department store remained the major distribution channel, through which 86.6% of products are sold, because consumers tend to buy middle to high end products in the store (52% for daily care and 63.7 for make-ups). But the sales amount of shopping mall rapidly rose beyond 50%.

The Euromonitor attributed the reasons for good development of China cosmetic market to the urbanization, female empowerment and blogger and celebrity influence, and estimated the "new" consumers on beauty routines coupled with product variety will fuel growth.

According to the current statistics, it is predicted the China's market will grow in three ways:

1. Market Size: beauty and personal care market in China is expected to reach CNY 486 bn by 2021, which means an expansion of CNY 152 bn over next 5 years;

2. Consumption trend: the China's per capita spend will be further reinforced over 2016-2021 with a boost in premium beauty expenditure, and is expected to offer the better scope for premium products and lucrative areas such as personalized solutions and niche labels;

3. Distribution trend: the role of internet retailing is becoming increasingly important in beauty and personal care. Meanwhile, department store continues to lose share to beauty specialist store. Hyper/super market remained large share especially for mass brands.