China’s Beauty Cheat Sheet for 2022

For an updated version of this story: Click here for our 2023 Beauty Cheat Sheet. Last year was a tumultuous one for beauty labels in China. Global makeup giant L’Oréal got hit by a swift backlash shortly after topping Double 11's top-seller list. Meanwhile, Korea's once-popular affordable cosmetic brands like Innisfree and Etude House closed most of their stores in Mainland China. Even C-beauty brands were hit hard. Perfect Diary, Florasis, and Judydoll all faced challenges, which meant they slid down the ranks at shopping festivals. The beauty sector is undergoing a total reconfiguration during 2022, as well. Unexpected players may take market shares while leader positions could see a shakeup. Influenced by the digital environment in which they live, young local consumers are shifting away from traditional formats and toward more advanced content like sonic marketing and diversified endorsements. According to Laurie Du, Mintel China’s senior beauty and personal care analyst, virtual influencers have become an effective and complementary marketing tool for building brand images and engaging with young consumers. Of consumers born in the 90s, she found that “25 percent say endorsements by popular virtual idols encourage them to purchase products from a brand.” But virtual idols are not the only trend inspiring beauty in 2022. Some other niche trends that appeared in 2021 are expected to mature and completely reshape China’s ever-evolving beauty landscape. As such, Jing Daily talked to analysts and experts to identify those trends and see how beauty brands might benefit from them in the coming months. Virtual idols on Douyin Many global (and local) brands, including L’Oréal, SK II, and Florasis, are already collaborating with virtual influencers or have even developed in-house versions. This craze will continue in 2022, but now companies will need to use these virtual spokespersons innovatively. The virtual idol Liu Yexi, who quickly shot to fame, is a great example. Her short video, which went viral overnight, blended metaverse aspects with beauty tips — all set to a thrilling plotline that is still trending on China’s version of TikTok, Douyin. Short video platforms like Douyin will become a crucial arena for beauty brands to win by entertaining their consumers with these digital ambassadors. Aside from videos that drive consumer purchases, Douyin now offers livestream e-commerce. So, in 2022, we expect to see more virtual anchors appearing on this platform's livestreams, selling goods alongside celebrity anchors. Clean and cruelty-free As in many parts of the world, recent natural calamities like floodings, typhoons, and hurricanes have raised alarm bells for people in China, forcing the government to tighten its policies on carbon neutralization, plastic production, and the use of microbeads. Additionally, according to Mintel’s latest study of China beauty market, 77 percent of participants believe that healthy or clean products are safer than ordinary ones, and over 60 percent think they are more effective. In response to these new demands, beauty giants like Amorepacific, Unilever, and Procter & Gamble, among others, have placed greater emphasis on being green, from using certified recyclable raw materials to producing sustainable packaging to implementing pure, non-toxic, and environmentally friendly ingredients in their formulae. Another area of focus for the Chinese authorities has been animal testing requirements for imported beauty products, giving a long-awaited green light to cruelty-free brands. The entrance of names like Aesop and The Body Shop into China will undoubtedly rise to meet the demand for cruelty–free beauty, encouraging global players to venture into this new and less crowded segment. “Meng” 萌 culture Meng culture, a local term for the Chinese preference for cute and cuddly things, has seen its influence grow in the beauty market. Brands have started tapping into this trend by collaborating with cute IPs, such as cartoons or digital characters. In fact, over 77 percent of the female consumers interviewed by Mintel stated that the unique appearance of IP collaborations made them more eager to buy. Meanwhile, 37 percent expressed a willingness to purchase their favorite IP — regardless of the price of the licensed product. For instance, a cute pink fox called LinaBell, recently introduced to the Duffy and Friends plush toy line at Shanghai Disneyland, has become China’s latest sensation. Its merchandise always sells out within minutes as enthusiastic fans are willing to pay ten times the price of her dolls on the secondary market. And over the previous year, many other companies have explored this concept. LVMH’s skincare brand, Fresh, launched a yearly collaboration with POP Mart’s most successful IP, Molly. Other brands dipping into the IP market include Shu Uemura, which partnered with Hello Kitty, and Colorkey, which teamed up with Pokémon. Today, Meng is not just a trend but a lasting sales engine that specifically targets Millennials and Gen Zers who still feel young at heart. New Chinese style 新中式 An appreciation for traditional motifs and culture is rising among young consumers and even penetrates the makeup market. Xinzhongshi, aka "New Chinese Style," has been recognized as one of the trendiest makeup styles on Xiaohongshu (by searching the keyword, 44,000 UGC instances appear on the platform.) However, the spirit of Gen Z’s new Chinese style is not to blindly identify with Made in China, notes Steven Luo, Xiaohongshu's head of brand marketing solutions of Luxury & Fashion. Instead, he says that “weaving in classic Chinese elements with modern trends, and amplifying cross-cultural collaborations” is more in vogue. Not surprisingly, many popular virtual idols have adopted oriental makeup aesthetics, like Ling, who now endorses Tesla and Vogue. But, the aesthetic is not fully defined yet. “Rather than simply blending Chinese elements, this new style is a reinvention,” explains Luo. Therefore, global beauty brands can playfully tap on their creativity or collaborate with makeup artists to propose New Chinese styles for users to imitate. Beauty Food The evolving demand for makeup and skincare products in China has broadened the concept of beauty, and young consumers now want beauty results through healthier habits or beauty foods like collagen drinks, antiglycation tablets, and anti-melatonin pills. According to data from Zhiyan Consulting collected between 2013 and 2015, the beauty food market grew by 500 million — likely because Chinese people tend to believe that oral nutrients are absorbed better than external applications. As such, China's beauty food industry is expected to enter a period of rapid development, reaching 3.8 billion by the end of 2022. So far, only Japanese and Korean brands have established a solid reputation in the local beauty food market. Yet, the expected growth offers opportunities to all beauty players. In fact, in 2020, Coca-Cola launched a limited edition collagen drink in China. In light of the above trends, it is foreseeable that many new players specializing in areas like cruelty-free makeup and beauty foods will emerge as winners in the 2022 beauty arena. The entrance of new labels will pressure the sector’s big players for innovation. Meanwhile, leading brands who enjoy larger marketing budgets can take advantage of emerging trends like virtual idols, Meng culture, and the New Chinese Style. In 2022, brands that dare to experiment with new trends will potentially get to the upper hand. For an updated version of this story: Click here for our 2023 Beauty Cheat Sheet.

Sectors

Insights

Company

China’s Beauty Cheat Sheet for 2022