It is commonly believed that the Chinese have a very high
concern about beauty and place a lot of importance on appearance. The
industry data does support this hypothesis with China being one of the largest
beauty markets in the world. According to a research done by research firm
Mintel two-thirds (65%) of Chinese consumers spent more on facial skincare
in 2015 than they did in 2014, and driven by this growing consumption, China's
beauty retail market is expected to be worth 338 billion yuan (US$50 billion)
by 2020.
To what extent is this size and growth driven by the importance of beauty in China? The data from the GfK Consumer Life study, with 27,000 consumers over 22 markets, suggests that the overall value that the consumers place on beauty in China is not very different from elsewhere in the world. Hence unlike the common perception, the Chinese do not spend more on beauty and grooming because they care more about their beauty - beauty is equally desired and sought everywhere in the world. There are several other factors which propel this market in China:
The Chinese and North East Asians, in general, have higher standards of beauty. Hence what may be considered perfectly charming in other parts of the world, may come under critical scrutiny and disapproval in China. According to the GfK research, while 22% of Brazilians and 30% of Mexicans say that they are fully satisfied with their looks, only 10% of the Chinese express this feeling of happy complacency (the satisfaction in other ethnic Chinese areas of Hong Kong and Taiwan is even lower). Additionally, it is not surprising that the Chinese are moving their loyalty more and more towards the Korean and Japanese brands, where the demands on beauty seem to be even more exacting (only 4% of Koreans and 2 % of Japanese are completely satisfied with their looks).
The proportion of working-age women who are actually working and earning in China is one of the highest in the world. According to a report by Ogilvy, female earnings in China grew from $350 billion in 2000 to $ 1.3 trillion in 2010 and is expected to grow further to $ 4 trillion by 2020. With this money in hand, women have their own means of consumption and do not have to depend upon their male partners to buy them beauty and grooming products. It also enables them to buy more premium and international brands.
Women in the workplace means that women feel a need to look good every day and right through the day - not just during certain parts of the day, when they feel it is important for them to turn on their charms.
In fact beauty serves a function beyond enhancement of sex appeal - it is also seen to contribute to looking good at work and associated with success in the workplace.
Both men and women are marrying later and divorce rates in China increased by 63% in the past decade. This creates a strong need to keep looking - and keep looking young and attractive.
The Chinese consumers in general are driven by rationality and logic and are not bogged down by sentiments of guilt or an over-active conscience. If beauty can be achieved and preserved through action and money, there is no moral compunction which holds them back (a similar rational mindset makes luxury goods a natural choice for them). Consumers in other cultures could be held back by feelings such as - "let me not fight the course of nature", "one should look one's age, why do I need to look younger than I am", "it is the inner beauty which matters" and so on.
The Beauty industry has ridden well on the transition to e-commerce in China, and Chinese consumers are now buying these products heavily on the internet - both from within China and abroad. Given the huge range and variety of products, high degree of research and recommendation seeking that the consumers go through in this category, would mean that beauty products are very compatible with online purchase. The industry in China has also transitioned with alacrity to the digital world.
It is not just the women - men are also contributing to the growth. The relatively low level of satisfaction on looks in China, Korean and Japan holds true not just for women but also for men, which is fueling the market for mens' grooming products. Additionally, in big Chinese cities, the competition among men to secure a fair and pretty bride (白富美Bai Fu Mei -fair, rich and beautiful) is fierce. While the traditional marketing strategy among men has been to position themselves more on their wealth than looks, with increasing competition, many of them are now looking at the last part of their proposition (帅 shuai of 高富帅 gao fu shuai- tall, rich and handsome) and exploring if beauty aids can help them enhance their competitive appeal. As a result, mens' beauty market in China is already the largest in the world.
