PORT WASHINGTON, NEW YORK, January 8, 2008 – Skincare products make up the majority of prestige beauty sales in China (71%), followed by makeup (17%) and fragrance (12%), according to leading consumer and retail information provider The NPD Group, Inc. Anti-aging and whitening products are the drivers of growth in the skincare arena in China. The prestige beauty industry in China looks much different than it does in the U.S. Nearly three-quarters of all sales in China come from skincare, compared to just a third of sales in the U.S.
China (Value Share) | U.S.
(Value Share) | |
| Skincare | 71% | 30% |
| Makeup | 17% | 41% |
| Fragrance | 12% | 28% |
Chinese women, just like American women, are willing to spend money on skincare products that contain anti-aging elements. The average price for prestige skincare products is 503 RMB ($67 US) and for prestige anti-aging skincare products the average price is 687 RMB ($92 US).
“In China, women are willing to pay a premium for anti-aging skincare products and we are watching this category very carefully because we see it as the driver of the prestige beauty industry here,” said Edward Wang, manager of China beauty, The NPD Group, Inc. Whitening products are the second most popular skincare product in China, making up about 17 percent of skincare sales.
“Whitening products are next on our list of products to watch in China’s beauty sector. The use of whitening products starts at a very young age in China and continues through adulthood. This is a product that is more popular in Asia and we see this trend continuing to grow and gain strength in the coming years,” said Wang.
For the first time, NPD is able to track the trends in the prestige beauty industry in China with the launch of NPD’s new, point-of-sale (POS) tracking service which tracks products sold in department stores. It complements NPD’s existing portfolio of services tracking the beauty industry in the U.S., Italy, and France.
Makeup
As a category, makeup is an emerging market in China. Sales of makeup were up 17% in the second quarter vs. the first quarter.
“Using cosmetics in China is relatively new; historically women did not wear makeup and so there is very little education on how to use it,” said Wang. “Now with more Western influences, women are showing a greater interest in learning how to wear makeup, and there are even TV shows in China that teach women how to apply makeup. More and more department store counters have enlisted sales people to help women use and try makeup, and it’s been well-received. We believe there is a lot of growth in this emerging market in China,” said Wang.
Within the prestige makeup category, makeup for the face is the largest sub category, making up 55 percent of RMB share, followed by eye makeup with 22 percent of RMB share, and lip with 15 percent share. All sub categories in makeup experienced increases in the first half of 2007. The average price for prestige makeup for the first six months of 2007 was 296 RMB ($39 U.S.). However, women are willing to spend more on face products and sets, the average price for face products was 370 RMB ($49 U.S.) and 500 RMB ($67 U.S) for sets.
Fragrance
Fragrance is the smallest category within the prestige beauty industry in China. It makes up just over 10 percent of the total industry. Sales of fragrance were up and down over the first six months of this year, but the overall performance was positive.
Women’s fragrances dominate the industry in China. Looking at the first half of this year, the women’s fragrance market was nearly six times the size of the men’s market, but men’s fragrances captured more RMB share from January to June. The average price for prestige fragrances in China for the first six months of 2007 was 518 RMB ($69 U.S).
| Chanel No. 5 |
| J’adore |
| Miracle |
| Chance |
| Addict 2 |
“I believe the fragrance industry in China is in its infancy. Culturally Chinese men and women don’t wear fragrance; it’s just not a priority,” said Wang. “Fragrance usage in China is more for special occasions and not something people do on a daily basis. However, it is an industry that is rapidly trying to change that, particularly in the male market. Just last year men’s fragrance specialized counters appeared at department stores, and we expect to see more growth in this area,” said Wang.
Subscribers to NPD’s new service get monthly reports with sales volume and market share at the category and item level as well as preferences among brands.
About The NPD Group, Inc.
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,600 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless.For more information, contact us or visit http://www.npd.com.
NPD currently offers one service for the prestige beauty industry: Retail Point-of-Sale (POS) Tracking. Retail POS Tracking is a point-of-sale research service that measures the performance of Prestige Fragrances, Makeup and Skincare.