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Transcript of © Euromonitor International 1 UNLOCKING CHINA’S COLOUR COSMETICS MARKET POTENTIAL 2014 AND BEYOND...
© Euromonitor International
1
UNLOCKING CHINA’S COLOUR COSMETICS MARKET POTENTIAL 2014 AND BEYOND
JUNE 2015, SHANGHAI
© Euromonitor International
2
Overview for colour cosmetics in China
Consumer and players’ trends in colour cosmetics
New digital opportunities
Future outlook
© Euromonitor International
3OVERVIEW FOR COLOUR COSMETICS IN CHINA
BEAUTY INDUSTRY GROWTH SUSTAINED
2008 2009 2010 2011 2012 2013 20140
1
2
3
4
5
6
7
Total / Premium / Mass Growth
Total Beauty Premium Beauty Mass Beauty
% V
alu
e G
row
th
Premium vs Mass Proportion Historic vs Forecast
Premium Beauty Mass Beauty
Note: Inner circle 2009-14, outer circle 2014-19
© Euromonitor International
4OVERVIEW FOR COLOUR COSMETICS IN CHINA
POWER SHIFT TO EMERGING MARKETS CONTINUES DESPITE SLOWDOWN
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019-100,000
0
100,000
200,000
300,000
400,000
500,000
600,000
-1
0
1
2
3
4
5
6
7
41%
51%
Developed vs. Emerging Markets in Total Beauty
Developed Emerging % Growth Developed markets % Growth Emerging Markets
US
$ m
illio
n
% G
row
th
© Euromonitor International
5CHINA AS DRIVING FORCE IN GLOBAL BEAUTY AND PERSONAL CARE
2009
/201
0
2010
/201
1
2011
/201
2
2012
/201
3
2013
/201
40
2
4
6
8
10
12
14
16
18
20
7.69.2
1.6 1.5 1.6
12
17.9
12.310.8
8.1
Beauty and Personal Care Market Growth
World China
RS
P v
alu
e g
row
th,
US
$,
cu
rren
t valu
e
OVERVIEW FOR COLOUR COSMETICS IN CHINA
Beauty and personal care in 2014:
BRIC Markets % Share
China37%
2009 2010 2011 2012 2013 20140.0
10.0
20.0
30.0
40.0
50.0
60.0
26.930.1
35.539.9
44.247.8
China Beauty and Personal Care Market Size
RS
P v
alu
e
size
, U
S$,
bil
lion
© Euromonitor International
6CHINA BEAUTY AND PERSONAL CARE: CATEGORIES’ DYNAMICS
2009
2014
0 5,000 10,000 15,000 20,000 25,000
Skin care, fragrances and colour cosmetics in China, US$ mn, fixed 2014 exchange rate
Skin Care
Fragrances
Colour Cosmetics
2009/2010 2010/2011 2011/2012 2012/2013 2013/20140
5
10
15
20
25
2009-2014 value growth%
Skincare fragrances colour cosmetics
Cu
rren
t va
lue g
row
th %
OVERVIEW FOR COLOUR COSMETICS IN CHINA
© Euromonitor International
7
Overview for colour cosmetics in China
Consumer and players’ trends in colour cosmetics
New digital opportunities
Future outlook
© Euromonitor International
8KOREAN WAVE IN COLOUR COSMETICS: CUSHION FOUNDATIONCONSUMER AND PLAYERS’ TRENDS IN COLOUR COSMETICS
IOPE
HeraLaneigeSulwhasoo Innisfree
© Euromonitor International
9CONSUMER AND PLAYERS’ TRENDS IN COLOUR COSMETICS
CUSHION IMPACT IN OTHER COLOUR COSMETICS
Etude House Mamonde
Etude House-Eye shadow Hera-Eye shadow Hera-Blush
Mamonde-makeup base
© Euromonitor International
10CONSUMER AND PLAYERS’ TRENDS IN COLOUR COSMETICS
KOREAN WAVE IN CHINA: CUSHION FOUNDATION
Laneige BB Cushion 325 RMB (15g*2) BB cushion Covering skin pores to make
it sleek as baby skin
Mamonde Brightening BB Cushion 269 RMB (15g*2) BB cushion Strengthens the fit between
BB cream and skin Effective moisturizing and
anti-ultraviolet rays
Sulwhasoo Evenfair Perfecting Cushion 346 RMB (15g*2) BB cushion Giving perfect coverage and
long-lasting hydration
Etude House Pearl Brightening Cushion 188 RMB (15g*2) All day long pearl bright skin
Innisfree Long Wear Cushion 188 RMB (15g) All day long wear
© Euromonitor International
11CONSUMER AND PLAYERS’ TRENDS IN COLOUR COSMETICS
FOUNDATION INNOVATION: DROP FORMATS
HR Powercell Foundation
Key innovation
1. Product innovation: Armani firstly brought in ‘drop foundation’ concept in 2013, followed by other key premium brands like Lancôme and HR.
Armani Mastro Fushion makeup
Lancôme Absolute Essence Foundation
© Euromonitor International
12CONSUMER AND PLAYERS’ TRENDS IN COLOUR COSMETICS
LIP PRODUCTS: MOST DYNAMIC IN 2014/2015
Maybelline bitten lips
Carslan berry girl lips
1. Product innovation: Maybelline NY launched bitten lips following latest Korean wave trend in lip products. Carslan introduced berrygirl lip product, looks a lot similar to Clinique’s Chubby Stick (introduced in 2012), but priced much lower (RMB89 compared to Clinique’s RMB160 per unit, according to their Tmall stores).
2. Celebrity endorsement: Maybelline NY invited Ziqi Deng to be the spoken person for its latest new product.
Growth Driving Factors
Clinique chubby stick
© Euromonitor International
13CONSUMER AND PLAYERS’ TRENDS IN COLOUR COSMETICS
Shiseido
L'Oréal
Mary Kay
Christian Dior
Chanel
LVMH
Estée Lauder
Shanghai Feiyang (Mariedalgar)
AmorePacific
Carslan
-2 -1 0 1 2 3 4
China: Share Growth in Selected Colour Cosmetics Companies 2009-2014
Market value share growth (percentage points)
LOCAL PLAYERS ON THE RISE
© Euromonitor International
14
Overview for colour cosmetics in China
Consumer and players’ trends in colour cosmetics
New digital opportunities
Future outlook
© Euromonitor International
15THE CHANGING RETAILING LANDSCAPE OF COLOUR COSMETICS
2009 20140%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
OTHERS
Internet Retailing
Direct Selling
Department Stores
Health and Beauty Retailers
Modern Grocery Retailers
% s
har
e NEW DIGITAL OPPORTUNITIES
1.0 19.4
© Euromonitor International
16CHANGES IN COLOUR COSMETICS MARKETING AND ADVERTISINGNEW DIGITAL OPPORTUNITIES
Internet boom
connected consumers
Shift away from traditional media
Beauty blogging
Video posting
649 MILLION
Chinese Internet users in 2014
>700 MILLION
Chinese Internet users in 2020
47.9% Internet penetration
among Chinese households in 2014
© Euromonitor International
17POPULARITY OF BEAUTY BLOGGINGNEW DIGITAL OPPORTUNITIES
557 MILLION
Mobile phone subscribers having m-commerce experience in 2014
© Euromonitor International
18
Overview for beauty and personal care in China
Consumer trends and manufacturers responses
New digital opportunities
Future outlook
© Euromonitor International
19FORECAST OF COLOUR COSMETICS
FUTURE OUTLOOK
© Euromonitor International
202014 AND BEYOND
FUTURE OUTLOOK
2014 2015 2016 2017 2018 20190.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
9.0
9.5
10.0
10.5
11.0
11.5
12.0
12.5
Colour Cosmetics value US$ bnGrowth rates y-o-y %
US
$ b
illio
n
% g
row
th y
-o-y
, cu
rre
nt
pri
ce
te
rms
China Colour Cosmetics: Retail Value, 2014-2019
5.9billion
US$ value sales from China colour cosmetics in 2019
74%Retail value growth Over
2014/2019
© Euromonitor International
21CHANNEL FORECAST: INTERNET RETAILING
FUTURE OUTLOOK
26%Value sales from internet retailing in 2019, up
from 19% in 2014
© Euromonitor International
22OUTLOOK FOCUS
FUTURE OUTLOOK
Korean Wave• Colour cosmetics put
Korean brands at competitive advantages, as key players oriented from Korea is keen to bring in latest innovative products from Korea, for example, cushion foundation and bitten lipsticks during the review period and probably cushion blush in the forecast period.
• Key innovation ensure that they are appeal to consumers, particularly young workforce and students who will grow to be consumer mainstream in next five to ten years.
Distribution• Health and beauty
specialist retailers to expand into lower tier cities, through either standalone or chained format.
• Internet retailing continue to be the most dynamic . In addition to B2C internet retailers like Tmall.com , Jumei and UCO, emerging e-channel like Wechat will be another option for internet retailers.
Competition• International player
continue to focus on mainland China market.
• Local players will join the battle, with increasing intensified competition between international and domestic players.
As always brands that are able to understand consumers and their motivation for buying colour cosmetics will perform best
© Euromonitor International
23
THANKS FOR LISTENING
Michelle Mai
Business Development Account Manager [email protected]
© Euromonitor International