Table of Contents
Introduction
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- Retailers covered in this report
- In-store
- Online
- Methodology
- Limitation
- Abbreviations
Executive Summary
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- A promising future
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- Figure 1: Best- and worst-case forecast of China beauty retailing sales, 2008-18
- Maximise consumer reach with channel convergence
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- Figure 2: Beauty retailing channels bought from in the last 6 months, by beauty retailing channel bought from in the last 6 months, December 2013
- Attract shoppers beyond price promotions and discounts
- Immersive shopping experience
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- Figure 3: Consumer buying behaviour, by beauty retailing channels bought from in the last 6 months, December 2013
- Tailor services at a city-specific level
- What we think
Issues in the Market
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- How can retailers maximise consumer reach with channel convergence?
- How can retailers attract shoppers beyond price promotions and discounts?
- Could a more immersive shopping experience drive consumers in-store?
- How can beauty retailers tailor their services at a city-specific level?
Trend Application
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- Return to the Experts
- Let’s make a deal
- Mintel Futures: Old Gold
Market Drivers
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- Key points
- China revises e-commerce laws to fight fraud and boost transparency
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- Figure 4: Internet users and penetration rate, 2005-13
- Figure 5: Online shopping category penetration (% of consumers who have shopped per category), 2012
- Internet giants fight for market share in mobile shopping
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- Figure 6: Ownership of consumer technology products, February 2013
- Figure 7: The rapid growth of mobile internet shoppers, June 2012 and December 2012
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- Figure 8: Weixin, the nation’s favourite social media with a few fun features like "Shake " and "Drift Bottle.", February 2014
- Figure 9: Vending machine alliance with Weixin in a Shanghai tube station
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- Figure 10: Laiwang offers similar functions with Weixin, February 2014
- Figure 11: Nike, L’Oréal paris, and Olay Weixin account, February 2014
- The emergent middle class have the potential to boost both online and offline beauty sales
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- Figure 12: The growth of Chinese middle class households, 2000-15
- The Woju generations shape online consumption
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- Figure 13: Five clusters based on lifestyle aspiration, September 2013
Who’s Innovating?
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- Key points
- Facial skincare dominates NPD in the beauty sector
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- Figure 14: New product launches, by top four beauty categories and other, 2009-13
- Own-label launches see a decline in launch activity
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- Figure 15: Beauty and personal care new launches, branded vs own-label, 2009-13
- Watsons leads own-label NPD
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- Figure 16: Own-label product launches, % share for A.S. Watson, 2009-13
- Figure 17: Examples of own-label facial skincare launches from A.S. Watson, 2013
- Click and collect for added convenience
- Weixin “discount your Pepsi” machine generates opportunities for beauty retail
- The Rise of “Me-tail”
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- Figure 18: Share with your best friend, Dove shower gel campaign, December 2013
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- Figure 19: Afù campaign, “to become a catman”, January 2014
- Awakening the senses
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- Figure 20: Shanghai’s Under Armour store, November 2013
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- Figure 21: The Fat Duck's sound of the sea dish, help people experience one flavour more intensely by offering the sound of farmyard chooks, October 2013
Market Size, Forecast and Segment Performance
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- Key points
- Segment sales by sector
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- Figure 22: Chinese value sales of beauty and personal care products, by category, 2009-13
- Forecast
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- Figure 23: Best- and worst-case forecast of China beauty retailing sales, 2008-18
- Figure 24: Annual disposable income, 2007-12
- Forecast methodology
Market Share
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- Key points
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- Figure 25: Retailers’ value shares in beauty and personal care, top five retailers, 2011-13
Companies and Brands
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- A.S. Watson
- Sephora
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- Figure 26: Sephora Outrageous Volume Dramatic Mascara, May 2013
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- Figure 27: Sephora flagship store in Shanghai, February 2014
- Gialen Cosmetics
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- Figure 28: Gialen Collagen Whitening & Moisturising Mask, July 2012
- Tmall
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- Figure 29: Penetration rate of Chinese shopping websites, March 2013
- Jumei
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- Figure 30: Jumei home page
Channels of Distribution
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- Key points
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- Figure 31: Value sales of beauty and personal care products, by channel of distribution, 2013
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- Figure 32: Number of stores, by segment, 2012 and 2013
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- Figure 33: Innisfree opened its flagship store in the Superbrand Mall, which is located in the downtown area of Pudong, Shanghai, February 2013
The Consumer – Usage of Beauty Retailers
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- Key points
- Mega online platforms take the retail lead
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- Figure 34: Beauty retailing channel bought from in the last 6 months, December 2013
- Age proves no boundary to the online shift
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- Figure 35: Beauty retailing channels bought from in the last 6 months, by age, December 2013
- The integration of online and offline
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- Figure 36: Beauty retailing channels bought from in the last 6 months, by beauty retailing channel bought from in the last 6 months, December 2013
- Affluent people buy everywhere
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- Figure 37: Beauty retailing channels bought from in the last 6 months, by monthly personal income, December 2013
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- Figure 38: Repertoire of beauty retailing channels bought from in the last 6 months, by monthly personal income, December 2013
- The disparity between cities
The Consumer – Beauty Products Purchased
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- Key points
- High penetration of most beauty categories
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- Figure 39: Types of beauty products bought in the last 6 months, December 2013
- Facial skincare remains essential
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- Figure 40: Types of beauty products bought in the last 6 months, by repertoire of types of beauty products bought in the last 6 months, December 2013
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- Figure 41: Types of beauty products bought in the last 6 months, by monthly personal income, December 2013
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- Figure 42: Repertoire of types of beauty products bought in the last 6 months, by monthly personal income, December 2013
- Dalian, champion for beauty
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- Figure 43: Types of beauty products bought in the last 6 months, by city, December 2013
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- Figure 44: Types of beauty products bought in the last 6 months, by city, December 2013 (continued)
The Consumer – Buying Beauty Products In-store
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- Key points
- Promotion as a standard?
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- Figure 45: Most important factors for buying beauty products in-store, December 2013
- Members only
- Weaning the affluent off discounts and deals
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- Figure 46: Most important factors for buying beauty products in-store, by monthly personal income, December 2013
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- Figure 47: Most important factors for buying beauty products in-store, by monthly personal income, December 2013 (continued)
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- Figure 48: Beauty retailing channels bought from in the last 6 months, by monthly personal income, December 2013
- Shanghainese, deal seekers; Beijingese, time savers
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- Figure 49: Most important factors for buying beauty products in-store, by city, December 2013
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- Figure 50: Top five regions in China with the highest annual disposable income per capita (RMB), 2011
The Consumer – Buying Beauty Products Online
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- Key points
- Authenticity and provenance
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- Figure 51: Most important factors for buying beauty products online, December 2013
- Bespoke delivery service for the rich
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- Figure 52: Most important factors for buying beauty products online, by monthly personal income, December 2013
- Guangzhounese are the real money savers
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- Figure 53: Most important factors for buying beauty products online, by city, December 2013
The Consumer – Future Opportunities for Beauty Retailers
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- Key points
- Competition for savviness
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- Figure 54: Added-value services to engage consumers, December 2013
- Online buyers are more demanding for deals
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- Figure 55: Added-value services to engage consumers, by beauty retailing channels bought from in the last 6 months, December 2013
- Social and environmental responsibility matters more to the affluent
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- Figure 56: Added-value services to engage consumers, by monthly personal income, December 2013
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- Figure 57: Repertoire of added-value services to engage consumers, by monthly personal income, December 2013
- Chengdu, an emerging centre for selling lifestyles
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- Figure 58: Added-value services to engage consumers, by city, December 2013
The Consumer – General Behaviour towards Buying Beauty Products
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- Key points
- Building content online
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- Figure 59: Consumer buying behaviour, December 2013
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- Figure 60: Media used in the three months to October 2013
- Creating great customer experiences
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- Figure 61: Consumer buying behaviour, by beauty retailing channels bought from in the last 6 months, December 2013
- Convenience is king
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- Figure 62: Consumer buying behaviour, by beauty retailing channels bought from in the last 6 months, December 2013
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- Figure 63: Consumer buying behaviour, by beauty retailing channels bought from in the last 6 months, December 2013
Appendix – Trend Application
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- Old Gold
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- Figure 64: China population trend, 2004-12
Appendix – Who’s Innovating?
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- Figure 65: Top five areas for new product launches, 2009-13
- Figure 66: Own-label product launches from A.S. Watson, % share, by category, 2009-13
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Appendix – The Consumer – Usage of Beauty Retailers
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- Figure 67: Beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 68: Most popular beauty retailing channel brought from in the last 6 months, by demographics, December 2013
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- Figure 69: Next most popular beauty retailing channel brought from in the last 6 months, by demographics, December 2013
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- Figure 70: Other beauty retailing channel brought from in the last 6 months, by demographics, December 2013
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- Figure 71: Beauty retailing channel brought from in the last 6 months, by most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 72: Beauty retailing channel brought from in the last 6 months, by next most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 73: Beauty retailing channel brought from in the last 6 months, by other beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 74: Types of beauty products bought in the last 6 months, by most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 75: Types of beauty products bought in the last 6 months, by next most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 76: Types of beauty products bought in the last 6 months, by other beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 77: Added-value services to engage consumers, by most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 78: Added-value services to engage consumers, by next most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 79: Added-value services to engage consumers, by other beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 80: Consumer buying behaviour, by most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 81: Consumer buying behaviour, by next most popular beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 82: Consumer buying behaviour, by other beauty retailing channel brought from in the last 6 months, December 2013
- Repertoire analysis
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- Figure 83: Repertoire of beauty retailing channel brought from in the last 6 months, December 2013
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- Figure 84: Repertoire of beauty retailing channel brought from in the last 6 months, by demographics, December 2013
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- Figure 85: Beauty retailing channel brought from in the last 6 months, by repertoire of beauty retailing channel brought from in the last 6 months, December 2013
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Appendix – The Consumer – Beauty Products Bought
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- Figure 86: Types of beauty products bought in the last 6 months, December 2013
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- Figure 87: Most popular types of beauty products bought in the last 6 months, by demographics, December 2013
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- Figure 88: Next most popular types of beauty products bought in the last 6 months, by demographics, December 2013
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- Figure 89: Types of beauty products bought in the last 6 months, by most popular consumer buying behaviour, December 2013
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- Figure 90: Types of beauty products bought in the last 6 months, by next most popular consumer buying behaviour, December 2013
- Repertoire analysis
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- Figure 91: Repertoire of types of beauty products bought in the last 6 months, December 2013
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- Figure 92: Repertoire of types of beauty products bought in the last 6 months, by demographics, December 2013
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- Figure 93: Types of beauty products bought in the last 6 months, by repertoire of types of beauty products bought in the last 6 months, December 2013
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Appendix – The Consumer – Buying Beauty Products In-store
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- Figure 94: Most important factors of choosing beauty products in-store, December 2013
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- Figure 95: Most popular most important factors of choosing beauty products in-store, by demographics, December 2013
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- Figure 96: Next most popular most important factors of choosing beauty products in-store, by demographics, December 2013
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Appendix – The Consumer – Buying Beauty Products Online
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- Figure 97: Most important factors of choosing beauty products online, December 2013
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- Figure 98: Most popular most important factors of choosing beauty products online, by demographics, December 2013
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- Figure 99: Next most popular most important factors of choosing beauty products online, by demographics, December 2013
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- Figure 100: Other most important factors of choosing beauty products online, by demographics, December 2013
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Appendix – The Consumer – Future Opportunities for Beauty Retailers
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- Figure 101: Added-value services to engage consumers, December 2013
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- Figure 102: Most popular added-value services to engage consumers, by demographics, December 2013
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- Figure 103: Next most popular added-value services to engage consumers, by demographics, December 2013
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Appendix – The Consumer – General Behaviour towards Buying Beauty Products
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- Figure 104: Consumer buying behaviour, December 2013
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- Figure 105: Most popular consumer buying behaviour, by demographics, December 2013
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- Figure 106: Next most popular consumer buying behaviour, by demographics, December 2013
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- Figure 107: Beauty retailing channel brought from in the last 6 months, by most popular consumer buying behaviour, December 2013
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- Figure 108: Beauty retailing channel brought from in the last 6 months, by next most popular consumer buying behaviour, December 2013
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