In 2018, international beauty and personal care around the world reached 6% value growth, its strongest value for over ten years.
Intelligence company, Euromonitor International, reveals that driving the continued success of the arena will be aspirational beauty including bespoke experiences and self-optimisation.
We take a look at the global movements influencing this growth:
1. Market Influence
The Asia-Pacific region accounted for a third of the worldwide industry value in 2018. The marketplace is expected to account for more than half of the total $68 billion anticipated from international growth during the forecast period between 2018-2023.
Latin America has also contributed to reaching these growth statistics following its sustainable comeback after its economic crisis.
China is set to be the big standout market in the forecast period, as it is expected to generate $21 billion of the sector’s growth. Despite its recovery, this figure is more than Latin America, and North America, indicating the increasing purchasing power that the Asian market will have in the coming years.
2. Is Mass the Comeback Kid?
In recent years, premiumisation has prevailed as the standout choice for consumers, particularly as luxury, the experience economy and indulgence beauty has driven the beauty space.
Digital development has led to brand stories, values and products latching onto the premiumisation-preferred communication styles.
In fact, every year from 2015-2018, premium outshone and strode ahead of mass beauty. However, in 2018, the balance and preference for premium beauty started to shift, with mass products spiking in performance across all regions apart from Eastern Europe.
In North America alone, mass beauty and personal care doubled in 2018, seeing a 3% increase. Western Europe was not too far behind, with its growth sitting at 2%. Yet, for the first time since 2012, mass and premium grew at almost the same rate in 2018.
3. Online Buys
The number of beauty and personal care products sold online amounted to 10% of all sales in 2018, reaching growth of more than 20% year-on-year and the highest figure recorded for e-commerce purchases.
The statistic marks the first time online sales have overtaken the direct sales model. Moving forward, brands looking to adopt the direct to consumer business model are expected to explore both the direct sellers and online opportunities available.
Omnichannel retailing is particularly attractive to beauty and personal care brands. Beauty specialist retailers have the main hold over their industry, creating nearly $73 billion in sales in 2018.
Specifically, beauty specialist retailers featuring multiple brands are leading the industry space. Their commanding position in the industry is set to continue as there is a renewed interest in popularity in their online and offline product portfolios through emphasising function and position rather than a brand-specific focus.
4. Skin remains top
There is no change at the top as the skin care category remains the largest and most adopted area of beauty amongst global consumers, accounting for over 25% of the total value.
In 2018, skin care sales soared by 8%. Support and growth for the segment has been helped by demands for clean beauty, transparent formulations and the focus on health and wellness.
Baby and child care products and make up with skin care claims have leveraged the success of the skin care segment to spur growth. Other leading categories including fragrance and colour cosmetics have lost their strong positioning, as to date, they have not been able to keep up with shifts in trends.
5. Health comes first
We have seen how the health and wellness trend overlaps and is heavily influencing and helping beauty brands innovate and gain appeal. Good and honest ingredients, supply chains and all round disclosures creating trust and reliability are providing attractive marketing messages that appeal to all price points.
The digital era also delivers features and beauty solutions that support open and engaging conversations, information-gathering and a privacy-focused direct-to consumer selling model that supports safer and healthier aspirations.
A range of technological tools including diagnostics apps, artificial intelligence-based (AI) chatbots and e-commerce solutions powered through voice are enabling consumers to independently delve into understanding the efficacy of products.