clean beauty brands in China

The clean beauty market in China: niche market led by foreign brands

The clean beauty market in China may be daunting for many international beauty brands.  Some brands like the American Kiehl’s and the French La Roche-Posay have successfully built their presence in the $75.35 billion US worth beauty and personal caremarket. While the market is predicted to increase to a value of $87.64 billion US by 2025, domestic brands are becoming increasingly competitive, giving foreign brands a challenge.

What is clean beauty?

Clean beauty (纯净美学 in Chinese) does not have an official definition, but it is commonly recognized as products that don’t include ingredients suspected to be harmful to the individual’s health or the environment. Parabens, artificial colors, and synthetic fragrance are a few of the harmful ingredients common in conventional beauty brands. Consumers might not have heard of ‘’clean beauty”, but the associated buzz words like cruelty-free, natural, vegan, green, organic, and sustainable might sound more familiar. Now is the time for brands to tap into the clean beauty market in China as the changing regulations, consumer demands, and competition landscape have shown challenging yet promising opportunities for brands to enter and grow.

The major challenges in the Chinese clean beauty market

Many international clean beauty brands have struggled to enter the clean beauty market in China for various reasons like the required animal testing, the limited consumer demand for clean products, and the growing local competition.

Complicated animal testing requirements

China is one of the very few countries that have long required post-market animal testing. The required animal testing had limited the entry or even the growth of the clean beauty brands, whose ethical principles inhibit them from conducting animal tests. As of May 1st 2019, it loosened the required animal testing for a majority of products that are considered “ordinary”. However, that does not apply to products like those considered “special-use” cosmetics like hair dyes, sunscreens, and whitening products. Also, the qualification process is still another long and difficult process to overcome.  

Clean beauty is still niche in China

Another challenge is that clean beauty remains to be a niche market in China. Clean beauty brands are usually distinguished from other cosmetic brands by their minimum harm to the individual and the environment. However, even with the COVID-19 pandemic, the core purchasing drivers of most Chinese consumers still revolve around the functional rather than the emotional benefits. In a survey by Forrester, only 17% of Chinese consumers believe animal rights and protection affects their purchase decision the most. Also, consumers do not seem to have full access to information about their products. According to a CBN Data survey, 42% of the generation Z subjects believe they do not get enough information about the ingredients of clean beauty brands.

Pressure from local competitors

Although the clean beauty market in China is still relatively small, international brands may face threats by local brands. Just because the local brands may not be actively encouraging clean beauty products, they should not be disregarded. In 2020, five local brands dominated the top ten makeup brands in Tmall. Florasis and Perfect Diary made up 16.35% and 14.88% of the market share, respectively. Floraris uses Chinese recipes and ingredients, following a trend known as Guochao (国潮). It incorporates flower essences and herbal extracts to create a “natural, healthy, and skin-nourishing” products that go along with both the clean beauty characteristics and Chinese medicine philosophies.

Florasis and Lijia Qi Austin collaboration of  nature and peacock-inspired beauty product Clean beauty market in China
Source: Xiaohongshu, Florasis and Lijia Qi Austin collaboration of nature and peacock-inspired beauty product

What are the growth drivers of the clean beauty market in China?

Despite the challenges, there are still opportunities for international clean beauty brands. The relaxed animal testing and growth in consumers interest in health and the environment mark the time for brands to start planning their entry and growth strategies in China.

Loosened animal testing for most clean beauty products

The changes in cosmetics animal testing does allow majority of the brands to enter China without violating their cruelty-free policies. Although not all cosmetic products, most of them can be sold without animal testing. This means that brands are not restricted to direct selling via their own website or online Chinese retail platforms like Tmall, Taobao, and JD. They can work with other distribution channels to access a larger pool of customers. For example, British Lush products can be found on Taobao but not in retail stores. 

Lush product advertisement with #BeCrueltyFree# Clean beauty market in China
Source: Taobao, Lush product advertisement with #BeCrueltyFree#

Growing demand for clean beauty products

There is growing interest and even willingness to purchase clean beauty products among consumers in China. In a 2020 survey conducted by Statista, slightly over 80% of the respondents were either very willing or willing to buy clean beauty skincare products.

Who are China’s clean beauty consumers and what do they look for?

The Chinese consumers are increasingly becoming interested in clean beauty brands. According to Mintel’s latest study on the beauty market, product safety and effectiveness are two major purchase determinators. 77% of the subjects believe that healthy or clean products are safer than the ordinary ones, and over 60% believe they are more effective.

Among the consumers, more specifically Millennials and Generation Z are the two main groups who are showing the greatest interest in buying clean beauty products.

Trend-leading Millennials

Millennials are leading the clean beauty market in China. They have high openness to international beauty standards and high sensitivity to organic ingredients and natural benefits. However, they have limited access to them. Based on an AlixPartners study, 38% of the Chinese respondents agreed that “products are not readily available where [they] shop.”

Trend catching Generation Z consumers

Generation Z consumers, the second group, are also important in the clean beauty market. Despite their young age, they have strong purchasing power. Also, they prefer natural botanical ingredients and value ecofriendly product and have strong intention to use natural skincare products, according to 2020 CBNData.

What are some successful international clean brands in China?

Leading the clean beauty skin care market in China is Kiehl’s, followed by L’Oréal’s La Roche-Posay and then Estee Lauder’s Origins. Based on their Weibo’s posts, most brands highlight the effectiveness rather than the “cleanliness” of their products. For example, in one of Kiehl’s posts as shown below, there are elements of nature like the almonds on the left and the green plants on the right. But the post rather stresses on the effectiveness of the product.

Kiehl’s post promoting the Ultra Facial Toner Clean beauty market in China
Source: Weibo, Kiehl’s post promoting the Ultra Facial Toner

In addition to Kiehl’s, La Roche-Posay organizes live broadcasts where medical experts give advice to the viewers on how to take care of their skin and Origins posts scientifically informative posts along with photos of skin-clean celebrities. None of them focus particularly on the cruelty-free or “cleanliness” of their products. This shows that the brands still regard effectiveness – more than cleanliness – as the more important factor to approach their consumers.

Key takeaways for international clean beauty brands in China

International brands may face the following obstacles when they enter the clean beauty market in China:   

  1. Reforms have been made in the animal testing laws. However, it is still not applicable to certain products like those categorized as “special-use”.
  2. The clean beauty is still a niche market. Their allegedly “emotional” benefit of human and environment friendly does not appeal as much to the mainstream market that still favors rational benefits.
  3. The rise of local brands may slow down or even block the growth of the international brands.

However, brands can grow with the emerging opportunities:

  1. The loosened animal testing requirements does allow clean beauty brands to follow their cruelty-free values and sell their products.
  2. There is a growing interest of consumers over buying clean beauty products, especially among Millennials and Generation Z consumers.

The top clean beauty brands in China like those below successfully grew in China:

  1. Kiehl’s
  2. La Roche-Posay
  3. Origins

Author: So Ry Park

Check our report on the cosmetic market in China