China Beauty Industry Insights

Chinese beauty enterprises need to start from the three aspects of people, products and scenes to grasp the trend of the beauty industry, quickly capture market opportunities and win the first opportunity.

Author: Pi

Date: 2025.06.12

CONTENTS

1. Overview

2. Three "keywords"

3. Skin Care Analysis

4. Makeup Analysis

5. Personal Care Analytics

6. Fragrance Analysis

7. Beauty Instrument Analysis

8. Beauty Brand Breaking Points

Overview

Key Highlights

After years of rapid development, China's beauty and personal care market has become the world's second-largest market with a 17% share, a market share comparable to that of the United States, which is at the top of the list. However, in contrast to this impressive market volume, per capita consumption in China is only one-fifth that of the U.S., making the market a promising one. Accenture expects the market to grow at a compound annual growth rate of more than 10 percent over the next three years, with a market size of nearly RMB 700 billion in mainland China alone (see Figure 1).

Early C, late A, formula party, all these words that were unknown to traditional consumers have long become personal care labels for young consumers. In addition, the epidemic of the past few years has also given rise to new beauty consumption habits. 2023, as life returns to normal, people's love of beauty is also more and more budding. In the face of such a trend, are beauty companies ready?

Figure 1 Beauty and Personal Care Market Revenue Size in Mainland China, 2016-2025

The market outlook is bright but challenging for beauty brands.

Chinese consumers have adopted more rational spending habits during the epidemic, valuing product effectiveness, price, brand reputation, and endorsements.

Additionally, competition between local and international brands is intensifying, leading to higher brand elimination rates than other industries.

Source: Accenture Research and Analysis

Three "keywords"

Key Features

In Accenture's China Consumer Insights 2022 report, we revealed five consumer trends ⸺ the “me” economy, the new rationalism, masters of time, symbiosis with technology, and sustainable prosperity. The results of this beauty industry trend study show that the two studies before and after confirm each other to a large extent. According to Accenture, China's beauty industry in the post-epidemic era is showing three key characteristics ⸺ “from the heart” awareness, technological gains, and XOTD (see Figure 2).

01 人

02 产品

03 场景

“From the Heart” RecognitionGrowth

Users require deeper self-awareness and individualized insights.

· Emphasis on lifestyle changes and personal demands.

· Disrupting traditional norms to create a consumption circle.

Technology Enhancement

More effective blend of tech innovation and user insights for greater gains

· Emerging technologies redefining inherent “ingredients”

· Technologies redefining “ingredient” for more innovative tracks

XOTD

Self-expression is no longer just about dressing, it's also about holistic persona from OOTD* to XOTD**

- Self-expression, creating a persona around a scenario

- Everyday happiness, gifts are not just for the holidays

Figure 2 China's Beauty Industry in the Post-Epidemic Era Shows Three Key Features

These three sets of keywords are not only a portrait of the current situation of China's beauty industry, but also a profile of Chinese consumer trends. On this basis, five sub-categories, namely skincare, color cosmetics, personal care, fragrance and beauty equipment, are presented to show their respective market dynamics, category trends and brand breakthrough points.

OOTD: network buzzword, from the English “outfit of the day”, meaning “today's wear”

.XOTD：由OOTD衍生而来，来自英文“X of the day”。

Source: Accenture Research and Analysis

Skin Care Analysis

Skincare: Steady Growth

Skin Care: Steady Growth, “Precision Skin Care” Winds Up.

For a long time, domestic and foreign skincare brands have continuously invested in and cultivated the market, and the skincare market experienced a sustained period of high double-digit growth from 2016 to 2020. After the boom, the market is gradually maturing and leveling off, and we expect future annual growth to remain at approximately 8% (see Figure 3).

Figure 3 China Skin Care Category Revenue Size and Growth Rate, 2016-2023

As consumer demands in skincare continue to evolve and diversify, there is a noticeable shift in the market landscape from conventional products such as essences and creams to an expanding array of innovative subcategories. These cutting-edge offerings are meticulously designed to tackle specific skin concerns and foster overall skin health. This heightened emphasis on 'precision skincare,' which tailors solutions to individual needs, resonates deeply with current consumer preferences and is on the verge of emerging as a pivotal trend in the beauty industry as we look to the future.

Skin care category sub-trends

· Skincare Personalization

Consumers have shifted from focusing on brands and products to searching for products that meet their individual needs and scenarios. in the first half of 2021, searches for branded products in the beauty industry compared to searches for scenarios were 60% vs. 40%, and in the first half of 2022, the ratio has changed to 40% vs. 60%.

· Male skincare progression

In recent years, male skincare has expanded from “rubbing his wife's/girlfriend's skincare products” to “men's skincare products”, and then expanded into a series of category demands. The skincare habits of male consumers have gradually changed from “hitchhiking” to “exclusivity”, and male consumers are paying more attention to the suitability of products for their skin type.

·“Science and technology tree” to open up a new track

consumers look forward to both effective and safe skin care products, the supply side of the corresponding R & D in the more focused on three major directions: ingredient specialization ⸺ big effect to extend the segmentation of the demand; scientific formulations ⸺ from the “ingredients party” to the “party” to the ‘ingredients’ to the “party”. Party“ to ”formula party" upgrade; micro-ecological advancement ⸺ micro-ecological skincare concept is emerging. Skin care category sub-trends

Source: Accenture Research and Analysis

SegmentsMakeup Analysis

Makeup: Reviving Opportunities

Color cosmetics: a revival of vitality, a good time to ride the wave Around 2016-2019, international big brands have settled in domestic e-commerce platforms, the color cosmetics market experienced a high-speed growth bonus period, but this momentum came to an abrupt end in 2020. During the epidemic, wearing a mask when going out became standard, and the market growth rate slowed down sharply, with a three-year CAGR of only 5%. With the return of normal life, we expect the color cosmetics market to recover rapidly in 2023, with growth expected to reach 18% (see Figure IV).

Figure 4 Revenue Size and Growth Rate of Color Cosmetics Category in China, 2016-2023

In the realm of makeup, two products consistently stand out as the most coveted: lipstick and foundation. Their widespread appeal, driven by a strong consumer desire for these essentials, establishes a dynamic environment that presents brands with a fantastic opportunity to enhance their visibility and solidify their position in the competitive market landscape. Moreover, innovative products such as fixed makeup are beginning to carve out a niche for themselves—despite their current limited availability, they are experiencing a surge in popularity. This increasing consumer interest suggests a promising growth trajectory, hinting at a future ripe with potential for expansion and diversification.

Color Cosmetics Category Subtrends

· The “pleasure yourself” breeding high custom makeup

Consumers no longer pursue the “mass aesthetic”, but according to their own characteristics, customized makeup belongs to their own. Highly customized makeup such as “square and round face makeup”, “single eyelid makeup” and “diamond-shaped face makeup” have blossomed.

· Focusing more on scenario-based needs

Different life scenarios have different focuses and needs for makeup. Commuting to work to quickly put on makeup, visit elders to light makeup ...... brands began to communicate product selling points for different scenarios.

· Makeup segmentation is more professional

The traditional large categories can no longer meet the segmented needs of beauty users, and more refined needs and practices need to be supported by more segmented products. At the same time, beauty tools are more abundant, and eyelash makeup styling is in high demand.

· Makeup IP is deeply rooted in people's hearts

With the prevalence of the concept of overall makeup, makeup product seeding has evolved into makeup seeding, forming more and more makeup IPs, such as holiday makeup and vegan makeup. Consumer creativity has been fully stimulated, and original user-generated content (UGC) has blossomed.

Makeup IP is deeply rooted in people's hearts

Source: Accenture Research and Analysis

Personal Care Analytics

Makeup: Reviving Opportunities

Personal care: the battle for differentiation and high-end is in full swing.

The personal care market, with a revenue scale of over $100 billion in 2022, is the second largest category among all sub-categories after skin care. However, as the user base growth dividend recedes, the basic market of personal care category has become saturated.

Figure 5 China Personal Care Category Revenue Size and Growth Rate, 2016-2023

In this context, differentiation and premiumization are poised to emerge as key growth catalysts. In contrast to the flat growth of mass personal care, we foresee high-end personal care expanding at a 22% rate, propelling the overall market upwards.

Personal Care Category Subtrends

· Beyond Basic Needs to Segmentation

Coto more exquisite care for various parts of the body. Products have also shown a trend of segmentation and specialization to better meet user needs.

With the popularization of the concept of self-pleasing, the need for personal care has evolved from basic cleansing needs

· Step-by-step ingredient progression towards skincare

Consumers are beginning to separate scalp care from hair care, resulting in a multi-step approach to skincare. Body care products in the composition and efficacy of the body care products are also constantly close to the skin care, part of the refinement according to the need to determine the effect..

· Breaking category boundaries to fragrance

With the personal care category in the composition, efficacy, increasingly “involution”, market competition is gradually changing from traditional function to added value. Personal care brands have entered the “olfactory battlefield”, perfume brands are also actively layout personal care track.

Source: Accenture Research and Analysis

Fragrance Analysis

Fragrance: Expanding Market

Fragrance: Highly successful, entering the new blue ocean

The olfactory economy is soaring, with a compound annual growth rate of nearly 20% in the past five years. Among them, the proportion of personal perfume is increasing year by year, accelerating growth. However, the penetration rate of the main population from the fragrance, China is only about 10% of Europe and the United States, a huge gap that allows us to see that the domestic fragrance market is still a blue ocean (see Figure VI).

Figure 6 China Fragrance Category Revenue Size and Growth Rate, 2016-2023

Fragrance Category Subtrends

· The first bottle of preferred those “can not go wrong with the perfume”.

Perfume “white” in the attempt to buy the first bottle of perfume in life, international brands often by virtue of its higher acceptance and popularity, become the first choice to buy incense.

· Perfume has become a wearable fragrance ⸺ “wear” fragrance.

The perfume “veterans” who are accustomed to daily use of perfume have more advanced needs: for them, “wearing” perfume is like dressing, and the choice of daily perfume is concerned with matching the right type of perfume according to the season, wearing and other elements.

· The perfume connoisseur knows more about perfume, and the perfume connoisseur knows more about perfume.

Perfume connoisseurs know more about scent, and they use scent to reveal their personal style and build a persona. Under the influence of the “perfume is a persona” concept, connoisseurs prefer to use niche or unique salon fragrances as a way to express themselves.

Source: Accenture Research and Analysis

Beauty Instrument Analysis

Beauty Devices: New Growth Potential

Beauty equipment: “black technology” led by the industry blowout period .

More consumers are increasingly concerned about the investment in their own image, like to taste the fresh group began to pay for “black technology”: radio frequency beauty instrument, phototherapy repair mask, micro-current beauty instrument, etc. become the majority of consumers! The beauty instrument market is growing rapidly. Overall, the beauty instrument market is growing rapidly, with a CAGR of 26% from 2016 to 2023, making it a new potential track in the beauty field (see Figure 7).

Figure 7 China Beauty Instruments Category Revenue Size and Growth Rate, 2016-2023

Beauty Instrument Category Subtrends

· Demand-side awareness popularization and rising enthusiasm

The popularization of medical beauty and celebrity endorsement on social media platforms have boosted consumers' awareness of “active anti-aging”. The expansion of medical beauty has given rise to a new scene of “home beauty salon”, and beauty equipment has become the home substitute for medical beauty programs.

· Supply-side technology has changed from “integration” to “segmentation”

After the single-point breakthrough in 2005-2010 and the technological integration in 2010-2020, beauty instruments have started to extend to the scene segmentation, and major brands have launched new products that are scene-oriented, targeting the precise parts and adjusting the parameters of the mode on their own in response to the segmentation needs.

Source: Accenture Research and Analysis

Beauty Brand Breaking Points

Recommendations for Brands

The emergence of new lifestyles and consumption habits has prompted companies to be more agile in responding to changes in the market, staying close to users' needs, and iterating and innovating. At a time when challenges and opportunities coexist, in order to seize the consumer recovery and achieve growth, companies need to start from production and R&D, products, channels, sales and other aspects of the development of the category according to the trend of development, to find a breakthrough point, to do a good job of branding with a long-termism mentality, to create high-quality products.

In the face of more volatile and complex industry trends, beauty brands are advised to quickly capture market opportunities and win a head start through the IDEA four-step approach.

nsight

Explore segmentation opportunities and innovation potential based on in-depth user insights

efine

Define product selection, selling points, marketing strategies and marketing scenarios for user pain points, behaviors, preferences, and trends

xpand

Achieve systematic marketing and effective customer acquisition through quality content and efficient placement

dvocate

“From single product to brand”, through the single product to drive the brand power, evoking users to interact with the brand

Thank You