Accounting for a staggering 60% of global sales in 2016, the Asia Pacific region certainly knows what it’s doing when it comes to the premium skin care segment. With that in mind, here’s what you need to know about advancements in this arena.


In terms of market breakdown, South Korea may be the show pony of the region for its technological advancements and quirky cosmetic concepts of late, but developing countries are rapidly emerging. Meanwhile, Japan is proving that it may have been down, but it certainly not out. The country remains the biggest market for cosmetics in the region with nearly $9 billion in sales.


Up until the onset of the K-beauty phenomenon, Sunny Um, research analyst at Euromonitor International, contends Japanese premium skin care brands have been the most active in overseas expansion with the likes of SK-II, Shiseido and Kosé’s Sekkisei giving global prestige giants like Estée Lauder and Lancôme a run for their money.


“These brands have registered significant sales not only in their home country but also in China, Hong Kong, South Korea, Malaysia and even Vietnam,” Um told Happi.


China’s sales of more than $7 billion ranked the country in second place, ahead of South Korea’s $3.25 billion, which was followed by Taiwan with $1.2 billion.


Accessible Luxury

The premium skin care segment is comprised of facial moisturizers, toners, anti-agers, cleansers, face masks, body, sun, hand and lip care products. According to the Euromonitor International figures, despite the value sales of facial moisturizers ($7.25 billion) and anti-agers ($5.75 billion) blowing hand care ($200 million) out of the water, the latter category has posted the most growth, thanks to China and Vietnam.


“In these two developing markets where the middle class is fast expanding and skin care interest is high, premium hand care is an ‘accessible luxury’ with relatively cheaper price points,” Um informed this publication.


Brand-wise, L’Occitane’s hand care products are currently the most popular across the region, thanks to a strong, diverse portfolio and pack sizes. Among developed Asian markets, South Korea is showing fast growth in this category as local consumers’ beauty taste is highly sophisticated and their beauty interest is expanding beyond facial care into total, holistic beauty including body and hand care.


Varied Consumer Preference

While Western brands continue to dominate with 54% of the premium skin care segment in Vietnam, Asian brands are regarded as more relevant. Here, local players including Shiseido, Laneige, O Hui and Kanebo are the most favored brands.


As a result, Vietnam has been flagged as a market with “key growth potential” alongside India where consumer demand for Ayurvedic and natural healing products is spilling over into the premium arena.


Product launches like Kama Ayurveda Kumkumadi Miraculous Beauty Ayurvedic night serum, Turmeric and Ghee eye cream from Sundara Holistic and Pratima’s almond oil-based cream are flying the flag for this emerging category. Indonesia is another market with serious potential despite being in its infancy, Halal and natural care is appreciated and high-end products like Paul Penders Avocado & Cranberry night moisturizer and PHB Ethical Beauty Argan & Chamomile Hydrating Serum have fared well.


A Retail Presence

China and Vietnam are the main attractors of major international cosmetics companies on the region as “local consumers’ interest in beauty is much more sophisticated than those in other developing countries,” according to Um.


As a result, Um reports that there has been massive investment in retail and mega shopping mall developments.


“International premium brands are opening stand-alone boutiques in malls to tap into this strong beauty interest to strengthen brand awareness and provide consumers with unique in-store experience,” she told Happi.


Um added that developed markets are experiencing some tough times in the retail scene though, especially in city states like Hong Kong and Singapore.


“These markets are saturated with brands, while the consumers with ever-evolving sophisticated tastes are constantly demanding  ‘newness,’” Um explained.


In addition, skyrocketing rents are a real challenge for new brands, whether they are opening or expanding their retail network in these markets.


Pop-up stores are a less risky alternative and are a good way of testing the market without committing to a large financial investment.


“Popular South Korean YouTuber, Pony launched her first cosmetics line, called Pony Effect at pop-up stores in Hong Kong and Taiwan to measure the local consumer demand before opening permanent stores in those markets,” explained Um.


Pop ups are also helping longstanding classic cosmetic labels to refresh their image and speak to a new generation in Asia.


Chanel, for example, opened a beauty pop-up store in Singapore in August 2017 to engage with millennials. The site even included a Coco Café and beauty bar for younger consumers looking to socialize and try out their products.


Having been present in the luxury beauty market in China for 20 years since introducing Lancôme; L’Oréal is also among the global players devizing more focused strategies to attract the next generation of Chinese luxury consumers. For example, in 2013, it announced projects such as the launch of the Clarisonic brand and the opening of the new Yves Saint Laurent Beauté boutique.

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Michelle Yeomans
Freelance Journalist
Email: [email protected]

Michelle Yeomans is an award winning multimedia journalist. She has been reporting on cosmetics industry movements in EMEA, US and Asia for five years and has won an award for her coverage of the complexities of operating in the Middle East. Michelle’s passion lies in tracking the beauty culture and trends of the Asia Pacific region. Ever the AV enthusiast, she also relishes the opportunity to create engaging video and podcast content for the B2B industry.