Podcast

Skincare items popular despite cost

Updated: 2010-09-06 15:47

Beijing office worker Susie Zhang is a skincare manufacturers' dream come true.

The 29-year-old routinely squanders half of her 4,000 yuan monthly salary on facial-care products alone.

A peek in her bathroom reveals a wide array of colorful bottles filled with various liquids and creams lined up like soldiers in formation.

Included are many of the products Zhang applies to her face every morning, including toners, serums, moisturizing lotions, eye creams, sunscreens, makeup base, liquid foundation and loose powder.

"Every evening, I use even more skincare products including scrubs, facial masks and many others. I think skincare and beauty products are an investment that pays you back," said the advertising industry worker.

Like Zhang, about 68 percent of Chinese consumers agree that spending time and money on their personal appearance is an important aspect of achieving a state of well-being, according to a report by research firm TNS Research International.

Serene Wong, CEO of TNS in China, said that the skincare product market in China has jumped from $44.83 billion compound annual growth rate (CAGR) in 2002 to $66.6 billion in 2009 and is expected to reach $77.84 billion by 2012. Compound annual growth rate is the year-over-year growth rate of an investment over a specified period of time.

According to the latest report by market research company RNCOS, the Chinese health and beauty aids market is the second largest in the Asia-Pacific region after Japan and the seventh largest in the world.

Data from the report states that an extremely low penetration level and the vast consumer base in China are the two key factors that are catching the attention of skin care manufacturers around the world.

However, the average person in China spends roughly $5 annually on these products, the equivalent of 3 percent of Japanese and 6 percent of people in the US.

Skincare firms eyeing the China market should have a long-term plan, said Andrew Fan, Greater China president of Nu Skin Enterprises Inc, a skincare and nutrition product developer.

"Market research by Nu Skin showed that many female consumers, with a monthly net income of 5,000 yuan or less, spend about 60 percent of their salary on cosmetic, beauty and healthcare products," he said.

Japanese economist Kenichi Ohmae recently said in Beijing that China currently has an aging population of 143 million and that figure will double by 2015.

At the same time, sales of anti-aging products globally have soared to $100 billion in 2009 and are expected to be over $176 billion by 2015. This craze will happen in China as well, said Ohmae.

Fan of Nu Skin said that they previously targeted consumers over 35 years of age, but now consumption by the post-80s generation has been growing as well.

With more and more young consumers hoping to preserve their youthful looks before the onset of aging, consumption has shifted from middle-aged and older consumers to younger consumers between the ages of 26 and 38.

Meanwhile, the world's health- and beauty-care industry is also experiencing a revival of Chinese traditional herbal products, which are favored by Chinese consumers and also many in other countries.

For example, ganoderma, one of the most popular ingredients in Chinese traditional herbal medicine, has been used in many skincare products like YUE-SAI.

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About the broadcaster:

Skincare items popular despite cost

Nelly Min is an editor at China Daily with more than 10 years of experience as a newspaper editor and photographer. She has worked at major newspapers in the U.S., including the Los Angeles Times and the Detroit Free Press. She is fluent in Korean and has a 2-year-old son.