Last month, global style icon Victoria Beckham’s beauty line, VB Beauty, made its China debut on the e-commerce site Tmall. For its release, the celebrity founder showed her commitment to the market by partnering with the top KOL Viya to promote the brand through a livestream.
The brand joins a long list of celebrity beauty initiatives on Tmall in China, including Miranda Kerr’s Kora Organics, Kim Kardashian’s KKW Fragrance, and Rihanna’s Fenty Beauty, to name a few. On social media, netizen sentiment about the news could be summed up in one Weibo comment, which stated, “is beauty the pension refuge for all Western divas?” Clickbait-driven cynicism aside, the real question behind this reaction should be: Does China need yet another celebrity beauty brand?
In the hyperdynamic beauty business-scape of China today, consumers aren’t faced with the usual dichotomy of big brands versus small brands. Instead, they must choose between global conglomerates (Loreal, Estee lauder, or Shiseido), C-beauty brands (such as quick-rising Chinese brands like Perfect Diary), Chinese celebrity beauty brands (Fan Beauty), and foreign celebrity beauty lines like VB Beauty. As you can see, space in the market for a new beauty brand, even a celebrity one, is becoming slimmer.
However, being at the epicenter of the booming beauty market is hard to resist, and that’s what China offers. According to the investment bank Morgan Stanley, China’s share of the global beauty market could increase by 66 percent over the next five years, which represents a sales increase of about $38 billion — nearly half of all global beauty growth.
Meanwhile, the sector’s traditional go-to markets have ground to a halt. In the world’s largest beauty market — the United States — makeup sales had already dropped by 7 percent before the COVID-19 crisis. In most rich Western countries, fatigue has set in among millennial women who bought too many beauty products and nowhere to go in the stay-at-home era. Looking at China for growth is even more urgent now.
At Victoria Beckham Beauty’s debut, the company’s CEO and co-founder Sarah Creal told Alibaba that “Chinese consumers share our values of modernity and discernment.” Over the past decade, China’s beauty junkies have evolved from putting cucumber slices on their eyes to sourcing high-tech devices from around the globe for micro-treatments. “We know that environmental concerns and ethical sourcing of raw materials and ingredients will also become more important to Chinese consumers over time, as brands continue to share information about their products,” Creal explained.
And Chinese Gen Z’s growing desire for sustainability has confirmed Creal’s bet on a growing reception for clean beauty in China. But thinking that altruistic aspects like “clean, cruelty-free, and women-owned” would automatically make Chinese consumers buy, risks oversimplifying China’s fascination with Western celebrity beauty products.
Fame is a relative concept
Celebrity beauty is not a new concept. In the US, the celebrity status of star-turned-entrepreneurs Rihanna, Lady Gaga, and Kylie Jenner played a pivotal role in building their labels’ reputations, and the fame of these founders has put their brands beyond the general competition’s reach. To many consumers, celebrity beauty is a force of disruption against the monopoly of big conglomerates. But in China, having an internationally famous face is far from enough.
“We’ve had a few inquiries from celebrity brands,” said Ker Zheng, marketing manager of the Shenzhen-based cross-border e-commerce enabler Azoya, to Jing Daily, “[but] the biggest issue is that they don’t believe in spending on marketing because they think their celebrity status carries over into China automatically.”
In the country’s insular media system, the younger generations are increasingly encouraged to consume domestic shows and follow state-approved Chinese stars. “Just because a celebrity is well-known in the US doesn’t mean they’re also popular in China,” Zheng added. “If they’re not popular in China, then the brand tends to fall flat upon entering the market.” And that doesn’t include the potential fallout for a foreign celebrity in China because of a politically incorrect incident. For instance, Lady Gaga was temporarily banned from the country in 2016 after she openly met with the Dalai Lama. This mistake could have prevented her from ever selling her brand on Chinese platforms.
Even top-tier players can struggle in China. Kim Kardashian’s KKW FRAGRANCE has over 1.1 million followers on Instagram but only 104k followers on Weibo and with little engagement. On Tmall, the brand’s best-performing products sell in the thousands, which pales in comparison with its US sales. In 2018, the brand’s three Kimoji-inspired scents made $5 million in just five minutes upon release. In the case of Victoria Beckham, even though she is famously known for her highly disciplined self-care regime, VB Beauty’s Tmall reveals that total sales of these products are weak.
Rihanna’s Fenty Beauty is by far the gold standard for celebrity beauty brands in China. Thanks to a splashy launch with new-generation stars like Wang Ju and a hype-building collaboration with the local bubble tea chain HITEA, Fenty has become a top brand in China that consumers would continue to buy with or without Rihanna’s face on it.
Intensified Threats from C-Beauty
Can there be a second Fenty? The ascendance of C-beauty is starting to pose greater threats to this challenge. Rising direct-to-consumer brands like Perfect Diary won Gen-Z wallets because of their social media agility over the past two years, but now they want to have the best products as well.
In an interview with People’s Daily, Chen Yuwen, the co-founder of Perfect Diary’s parent company Yixian E-commerce, said the brand is investing heavily in research and development after scoring an additional $100 million in capital fundraising recently. And this year, Perfect Diary has partnered with the Korean beauty conglomerate Cosmax to build Asia’s largest cosmetics production site while also pledging another $20 million toward skin research labs.
“C-beauty brands aren’t of less quality than foreign brands,” Chen said, “it is simply that foreign brands are selling at a premium because they have more brand equity. But if we prioritize originality, and surpass these international brands in terms of both product concepts and visual aesthetics, consumers will naturally choose us,” he continued.
Today, C-beauty is growing as quickly as Chinese Gen-Zers’ obsession with creative makeup and internet cultures. From Huaxizi’s social-friendly carved lipsticks to Perfect Diary’s virtual shopping personas, C-beauty players have a knack for “internet thinking” — a native concept that describes the online connectivity that Chinese businesses naturally have with their local customers. But also of importance: C-beauty brands sell for a fraction of the cost of the average celebrity beauty brand.
“No market moves faster than China,” said Creal in an interview. “Things that worked for brands even six months ago will not work today. We know we must stay nimble and constantly learn, then formulate our plans accordingly.” But now that China is a hotbed of beauty innovation and aesthetic development, doing so is becoming increasingly difficult.