Demand for Body Care Is on the Rise in China
Happi China
Although the Chinese government is determined to put a damper on the overheating economy, the beauty care industry never runs out of steam, posting double-digit growth for the past several years. Now, even the body care category is beginning to enjoy strong sales after years of relatively flat performance.
According to Datamonitor, the body care category was valued at $513 million in 2009, representing a CAGR of 4.4% since 2004. Market volume totaled 221.8 million units in 2009, representing a CAGR of 4.7% since 2004. According to Euromonitor, in 2010, body care accounted for around 2.2% of total beauty and personal care sales in China, and its sales increased 7.7% to $369 million. Impressive, but not as spectacular a gain as the 13.1% rise of skin care sales.
However, as China’s body care market is witnessing segmentation with a growing number of companies offering separate variants for specific areas such as hand, waist/abdomen and feet, two major subcategories by product claims, general purpose (i.e., hydrating/nourishing) and bodyreshaping, such as firming/anti-cellulite, show different results. The former increased its sales by 6.1% to $248 million, whereas the latter’s sales rose 11.1% to $121 million in 2010, according to Euromonitor.
Furthermore, premium firming/anti-cellulite posted the highest sales growth of 30.7% to $29 million, while premium general purpose posted the lowest growth of 5.5% last year. This growth rate gap between two major subcategories is expected to widen, as the products claiming to bring the added benefit of weight loss appearance or reduce signs of aging are gaining popularity among Chinese consumers, despite some skepticism regarding their efficacy.
While an increasing number of companies are now entering this market to cash in on robust beauty growth, the overseas dominance in this category is apparent as in other beauty categories. On Euromonitor’s top lists of 2010 China body care, those familiar international names such as Beiersdorf AG, L’Oréal and Amway are still leading the way in both general purpose and firming/anticellulite lists, with Nivea from Beiersdorf securing the No. 1 position in both subcategories.
Still, there are a few local brands managing to make their way on the lists, with Sunrana from Zhuhai Sunrana Cosmetics Co. Ltd. following Nivea as No. 2, and Softto from Softto Co. Ltd. as No. 5 on Euromonitor’s top firming/anticellulite body care list. Also, Herborist from Shanghai Jahwa United Co. Ltd. comes in at No. 3 on its general purpose subcategory list.
More Channels
As we see in other beauty categories, many manufacturers are exploring new channels to distribute their body care products, especially those targeting younger generations. According to Datamonitor, consumers in the 15-24 age group used 23.6% of the total body care products in China in 2008. The internet is proving to be young consumers’ best friend in helping them find the best products on the market, and therefore an online marketing/ selling strategy is being adopted by those companies believing that online word-of-mouth effect can be an answer to some doubt over product efficacy.
Once again, overseas brands are steps ahead in this online market. According to the latest tracking report by online consulting firm Smart Path, SKIN79, Clinique and Clarins led the online China body care market, with a collective 9.5% share in the third quarter of 2010. The top 10 brands in the online China body care market in 2010 were: SKIN79, Clinique, Clarins, Shiseido, Laneige, The Body Shop, Olay, Jurlique, L’Oréal and Mentholatum — all of them multinationals.
Additional Care for Mom
Among various body reshaping products that clearly enjoy the greatest popularity in China, anti-stretch mark products are proving successful especially at a time when China is experiencing a baby boom. Not only do young moms want to give their children the best care, they are also willing to indulge themselves, which of course includes extra care for their own faces and bodies. This is triggering a surge in anti-stretch mark product sales.
This self-indulgence phenomenon is apparent in the post-1980s generation, which is regarded as the “ideal consumer” by many industry analysts. Born since the 1980s when China’s economic reforms got under way, these young moms came from single-child homes and did not experience social and economic hardship like previous generations. Therefore, these 1980s’ moms are culturally more optimistic, financially wealthier and behaviorally more aggressive, and are willing to try novelties.
Buoyed by increased consumption, manufacturers are leaving no stone unturned to cash in on this “fourth baby boom” and are increasingly using traditional channels and the internet to push sales. It has been reported that the leading anti-stretch mark brands in China are SkinDoctors and Nereids from overseas, as well as Conba from a local manufacturer. As the current baby boom is expected to last until 2015, the sales of this once niche product is expected to grow.
Bright Future,Tough Regulation
As the demand for body care continues to grow, its rosy future is widely recognized. According to Datamonitor, it is estimated that by the end of 2014, the body care category will be worth nearly $616 million, with an expected CAGR of 3.7% between 2009 and 2014. During the period, the market is expected to post a CAGR of 3.1% to reach 257.8 million units.
The reasons behind the accelerated growth are primarily attributed to rising disposable income and greater awareness. In this country, everyone wants to improve their appearance, as seen in the demand for facial and body care; to lighten skin, improve body shape by toning or firming or remove unwanted hair.
There are still some challenges ahead facing this booming beauty and personal care industry. With products claiming specific efficacy on the rise, tougher regulations make sure products are safe and effective, and the body care category is no exception. In the latest Requirement of Technical Specifications on Cosmetic Products issued in April by the State Food and Drug Administration, both slimming/firming/anticellulite (termed as body reshaping cosmetics in regulations) and breast care products are regulated as special-use, and are therefore subject to more rules than general cosmetics.
Ally Dai is senior editor of Happi China. She has more than 10 years of experience in the cosmetic and food industries. Happi China is a leading media for the China household & personal care industry. Published by Ringier Trade Media in strategic editorial partnership with Happi, it helps local manufacturers update their knowledge on formulating, testing and packaging, as well as providing market insight.
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