When appearance matters
2016-09-23, WANG ZHUOQIONG

Aesthetics care has become the new luxury bag for many women in urban China.

For example, Wang Qianqian, a mother of a 3-year-old, is increasingly aware that her school friends are getting prettier despite their age.

She found that their secret “fountain of youth” is injections of hyaluronic acid treatment and Botox. So, she decided to apply hyaluronic acid under the skin of her face and around her eyes. She also used laser treatment that removed spots on her cheeks. The combined treatments cost 50,000 yuan ($7,500) and she has to have them performed regularly to keep her current looks.

“It is the most valuable investment I’ve ever made,” said Wang, a senior executive of an Internet and culture company in Beijing. “I am more confident since my face skin looks tighter and brighter.”

Wang is among thousands of Chinese women who have contributed to the 500 billion yuan market, according to an estimate by the Chinese Association of Plastics and Aesthetics in 2015. It is expected to become the world’s second largest market, rising to 1 trillion yuan by 2019.

The industry is growing at 20 percent annually. In some specific categories, the growth rate exceeds 50 percent. According to the association, the number of people employed in the medical skin care industry has grown to about 500,000.

Chinese women have strong interests in investing in their facial appearance. According to a report from Mintel Group released in August 2016, the facial skin care market was worth more than 91 billion yuan by the end of 2015 with a year-on-year growth rate of 11.5 percent.

The market will continue to see strong growth supported by the demand for antiaging and antipollution products, said the report. In addition, the hydration segment will continue to see strong growth.

Corporate employees, government civil servants and businesswomen accounted for more than 70 percent of the number of people using medical beauty services in 2015, suggesting the advantages and benefits brought by good looks. But the newcomers participating in such treatment are getting younger each year.

Sadie Zhang, a manager at Ladyjoy, a Beijing-based institution focusing on medical skin care, said the plastic surgery and medical skin care industry has been emerging during the last five years. 

“Good appearance helps relationships and work,” she said. “Even teenagers have come to us for a better look. It is no longer a treatment only for celebrities.”

People younger than 40 are likely demand entry-level procedures or skin enhancement, while those who are in their 40s choose more anti-aging treatment, said Zhang.

Investors and venture capital have also rushed to the medical skin care sector, where barriers to entry are relatively low and policy restrictions are loose. Lidu Plastic and Aesthetic, and Guizhou Limacon Hospital are publicly traded. Many medical skin  care applications also have attracted investment.

Wu Jianying, CEO and general manager of Shanghai Haohai Biological Technology Co, said China’s medical skin care market has taken about 20 percent of the global market, due to the demand for high quality of life as incomes have risen. According to the company’s first half-year report, sales have risen 25.1 percent, mostly due to its product Matrifill — a cross-linked sodium hyaluronate gel, for which sales revenue increased 148.7 percent year-on-year.

Chinese brands make gains but appetite for ‘K-beauty’ goes from strength to strength

Chinese local brands are outperforming Western brands, but Chinese women’s appetite for South Korean beauty products continues, according to an industry report.

Mintel Group’s facial skin care report released this month said Chinese companies including Pehchaolin Daily Chemical Co and Shanghai Shangmei Cosmetics have seen significant gains in market share.

Intensive investment in mass marketing and distribution channels has helped both of these companies grow rapidly in the short term. Booming e-commerce has also helped the two companies acquire more users without opening physical stores during the last five years.

More importantly, consumers have realized local brands are better value for money than most of the international brands. Mintel has tracked the product usage in 2015 and 2016. Facial cleanser remains the most used product among both women and men. Facial masks have replaced moisturizers to become the second most used product after cleanser. 

Chinese women’s appetite for so-called K-beauty continues. Some 33 percent said South Korean brands are their most often purchased brands, which rank the highest among all listed countries of origin.

Chinese women are enthusiastic fans of cosmetics endorsed by South Korean celebrities, particularly those popular with young audiences aged 20-24. They are tempted to buy skin care brands used by leading actors in South Korean TV dramas. 

Chinese women have established a distinctive association of brands from different countries. As a result, their purchase motivations are driven by these distinctive perceptions. 

The facial skin care market was worth more than 91 billion yuan ($13.6 billion) by the end of 2015, a year-on-year growth of 11.5 percent. The robust growth of domestic brands as well as brands from South Korea has expanded the market size further.

Looking ahead, the market will continue to see strong growth supported by the demand for antiaging and antipollution products.


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