China Cosmetics Market
Lately the demand for cosmetics has risen in China which is mainly due to the rise in disposable income of the Chinese residents. China has now become one of the largest consumer markets in the world. Even though the demand for cosmetics is growing fast in the backward areas, big cities still comprise of majority of the market share.
The major cosmetics companies in China are L'Oréal and Shanghai Jahwa. Shanghai Jahwa being one of the few brands that sell high end cosmetics that have access to department store channels, its brand Herborist has been successfully distributed in Spain, Netherlands, France and other markets. Also Shanghai Jahwa was also the first to launch Chinas first domestic skin care brand. The cosmetics category in China mainly comprises of make-ups, perfumes, skin care as well as men's cosmetics.
Many foreign companies are eyeing for a larger market share in China such as Mary Kay and Estee Lauder. The foreign brands in China currently serve the high end users whereas the domestic players service the needs of the middle and lower middle class individuals. Therefore immense opportunity lies in the lower class segment which has not been exploited by the foreign firms. Department stores, supermarkets, specialty stores, onlinesales and direct selling were some of the channels that were most used to distribute cosmetics to the public.
The price for cosmetics in China has risen over the past few years which has been mainly attributed to the increased costs of raw materials. The manufacturers try to curb the effect of price rise by passing it onto the consumers. Even though the Ministry of Finance has reduced the tariff rate on imported cosmetics, much change on the market prices will not be witnessed due to the high consumption tax.
To increase market awareness, foreign and domestic players have started spending huge sums of money on advertisements and marketing. Online portals have become an essential factor for sales distribution in China. A new trend that is being witnessed in the Chinese market is the use of cosmetics that are eco friendly mainly because they believe it causes less harm to their skin and the environment. The innovations that are being brought in by the domestic players with regards to the product and its packaging have given a tough competition to the foreign players such as Maybelline that has witnessed a drop in the sales. The local brands are gaining limelight and are being funded by venture capitalists.
The major cosmetics companies in China are L'Oréal and Shanghai Jahwa. Shanghai Jahwa being one of the few brands that sell high end cosmetics that have access to department store channels, its brand Herborist has been successfully distributed in Spain, Netherlands, France and other markets. Also Shanghai Jahwa was also the first to launch Chinas first domestic skin care brand. The cosmetics category in China mainly comprises of make-ups, perfumes, skin care as well as men's cosmetics.
Many foreign companies are eyeing for a larger market share in China such as Mary Kay and Estee Lauder. The foreign brands in China currently serve the high end users whereas the domestic players service the needs of the middle and lower middle class individuals. Therefore immense opportunity lies in the lower class segment which has not been exploited by the foreign firms. Department stores, supermarkets, specialty stores, onlinesales and direct selling were some of the channels that were most used to distribute cosmetics to the public.
The price for cosmetics in China has risen over the past few years which has been mainly attributed to the increased costs of raw materials. The manufacturers try to curb the effect of price rise by passing it onto the consumers. Even though the Ministry of Finance has reduced the tariff rate on imported cosmetics, much change on the market prices will not be witnessed due to the high consumption tax.
To increase market awareness, foreign and domestic players have started spending huge sums of money on advertisements and marketing. Online portals have become an essential factor for sales distribution in China. A new trend that is being witnessed in the Chinese market is the use of cosmetics that are eco friendly mainly because they believe it causes less harm to their skin and the environment. The innovations that are being brought in by the domestic players with regards to the product and its packaging have given a tough competition to the foreign players such as Maybelline that has witnessed a drop in the sales. The local brands are gaining limelight and are being funded by venture capitalists.
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