China Online Beauty Sales Surge in January

Online beauty sales in China last month surged by 58 percent year over year, according to Bernstein, providing a counterpoint to a stream of sobering earnings from global brands that have struggled there of late.

Major beauty firms including Estee Lauder, Shiseido, and L’Oreal, this month had all reported a softening of sentiment in the Chinese market. Japanese cosmetics makers in particular have been grappling with Chinese consumer fears and a boycott over the release of treated wastewater from a nuclear plant in Fukushima.

Bernstein’s measure of online beauty sales, which mostly strips out the idiosyncracies of the massive duty free market in China, can provide a clearer look into true Chinese beauty shopper sentiment. The country’s main duty free hub Hainan is on a protracted slump digesting regulatory changes made last year that impacted the daigou market and a higher propensity for Chinese shoppers to buy internationally with travel now more accessible.

L’Oréal in particular saw exceptional performance for Chinese e-commerce, Bernstein noted. Its topline grew by 56 percent in January, driven by strong results at its top luxury brands, Lancôme and Kiehl’s. LVMH ‘s beauty division grew by 47 percent, Shiseido 36 percent, Estee Lauder 19 percent, and local player Proya 110 percent.

Still, concerns surround the overall recovery of the Chinese consumer. Last week, it was revealed that China’s consumer price index in January fell 0.8 percent year over year, the fastest annual drop in 15 years, inflaming deflationary fears. It was the fourth straight month of decline.

Learn more:

China’s Consumer Slump Claims Another Victim as Shiseido Profit Slides

Weak consumer spending has also hit profits at L’Oréal and Estée Lauder.

Source link

About The Author

Scroll to Top