Cosmetics firms hope Cupid's arrow hits growth

With the arrival of this year's Valentine's Day, cosmetics companies in China are busy tapping soaring demand with the help of a winged cherub named Cupid.

According to Beijing-based online financial platform Jianpu.ai, in the week before this year's Valentine's Day, some 30 cosmetics brands have launched over 100 types of special gift boxes, or product sets, in China.

Yatsen Global Pte Ltd, or YSG, a Guangzhou, Guangdong province-based beauty group, is among such gift offerers. Consumers buying its Perfect Diary products can enjoy special package services and have the boxes enclose a special heart-shaped Anthurium andraeanum, a plant native to Colombia and Ecuador.

YSG's other brands, such as Pink Bear and Little Ondine, have also launched various special gift boxes to attract more consumers.

However, with Generation Z becoming the major consumption group, cosmetics consumption on Valentine's Day is also changing, a Jianpu.ai report said.

Compared to the post-70s and the post-80s generations, Gen Z consumers tend to pay for ceremonious demand, attaching importance to personality and connotation while making purchases and are found more willing to buy gifts for others than consumer groups of other ages.

Meanwhile, the report said the group is keen to make the most cost-effective choices by their affordability while making purchases.

A recent survey from Jianpu.ai showed that 83.42 percent of surveyed couples will prepare Valentine's Day gifts for each other with spending being between 500 yuan ($73.2) and 1,000 yuan.

The post-95s age group turned out to be the backbone of Valentine's Day consumption, with 95.52 percent of surveyed couples spending money on Valentine's Day, and many of these spending over 1,000 yuan.

Eyeing such a change in consumption trends, cosmetics makers are launching different product combinations in different price ranges to reach more consumers.

For example, YSL Beauty, a brand under L'Oreal Group, launched eight boxes for this year's Valentine's Day, with prices ranging from 780 yuan to 5,590 yuan.

These gift boxes not only cover the categories of skincare, cosmetics, perfume and fragrance but also suit various consumption levels from middle- and high-end to luxury.

Other brands, including Sisley, Estee Lauder, CPB and Clarins, also launched Valentine's Day gift boxes to satisfy the diversified needs of consumers.

Some enterprises are banking on innovations to attract more consumers. For example, Perfect Diary launched a love story collection activity, sending free Valentine's Day gift boxes to part of the consumers who share their love stories on Perfect Diary's WeChat account.

Many of the consumers receiving such free gift boxes tend to share their experiences on social media platforms, which brings more traffic for the cosmetics makers, experts said.

Deng Xintao, a researcher at investment company Lock Capital, said: "The cosmetics marketing during Valentine's Day is a big competition among enterprises. Apart from placing advertisements on social media platforms, more and more companies are launching special gift boxes to satisfy consumers of different consumption levels.

"In the short term, Valentine's Day will see a boost in cosmetics consumption and links between companies and more consumers."

Speaking of how enterprises should take advantage of the Valentine's Day economy to realize long-term growth, Deng said companies can launch more cost-effective product sets to tap more Gen Z consumers and offer discounts in various ways to increase their sales.

Deng said companies should enhance their links with consumers by devising different events to reach more consumers, learn more about them and raise their brand reputation.

"Aside from launching special promotional events for men and consumers buying for their sweethearts on Valentine's Day, cosmetics companies can come up with more tailor-made product sets targeting different consumer groups during different festive shopping galas," Deng said.