Source: CHEAA-run China Appliance
China’s beauty and health care (personal care) appliance industry ushers into a period of restructuring and upgrading after going through the stage of proliferation. At this point, the industry is going high-end and diversified, breaking down into many categories.
Skin care appliances become a dark horse of the industry
Skin care appliance sector is expected to see an explosive boom in years to come. Sales volume of skin care appliances doubled year-on-year in 2017 with the average price up by 50%, of which hydrating appliances, RF beauty machines and facial cleaning appliances stood out in particular, according to Zhiyan.org. Cui Zhaohui, Marketing Director of SKG, shared the following statistics with our reporter: the output value of China’s beauty care appliances came to 10.2 billion US dollars, a year-on-year growth of 6.9%. The compound annual growth rate of this sector in the past five years posted a strong figure of 9.2%. Many industry insiders are optimistic about the future of this sector.
Regarding reasons behind the boom, Ma Hong, General Manager of Kingdom Cares says, “Skincare appliances offer fast and convenient experiences that could only be enjoyed at a high cost at a certain time in a beauty salon before. Professional machines might have better effect but can hardly be used as a daily routine.” Skincare appliances, as an easy-to-access tool that can be used anytime, gain popularity among young people, a group that shows particular interests in entry-level products. In spite of this, breaking down consumers’ skincare needs might be another booster of market expansion. “Skincare appliances are developed to meet specific needs such as hydrating, cleaning, spot-fading, and anti-wrinkle, thus often sold as a package. This is different from many portable appliances.” Ma Hong says.
At an early stage of its development, this sector faces a number of issues. The most critical one at this point is product quality. Used directly on skin, product quality embodies an enterprise’ responsibility for consumers. “Our products have been put under strict tests throughout the process from design to production before placed on the market. We believe that the definition of a good product goes beyond good design. It covers good material, stable performance, safety in use and good effect. The surge of the sector, for a short period of time, could be fueled by untapped market potential, but in the end, will come down to technology. ” Cui Zhaohui says, “the industry needs to educate consumers but only for a short period of time since most consumers have developed a demand for better skincare products. The experiences offered by different levels of products are clearly different, driving enterprises to put more weight on core technology and product experience.”
When it comes to the classification of skincare appliances, it is not easy to draw a line. Zhu Jun, Secretary General of CHEAA, says, many of them cross the boundary between medical equipment and beauty and health care appliances. For instance, products that do substantial change to the skin should be managed as medical equipment but a facial steamer or cleaner,for example, falls under the scope of beauty and health care appliances. Jiang Feng, President of CHEAA, revealed at the founding meeting of CHEAA’s Beauty and Health Care (Persona care) Committee on June 28th that, CHEAA would start the standardization of this industry soon after the founding of the committee.
Steady market growth of traditional beauty and health care appliances
Traditional beauty and health care appliances such as hair dryers and shavers, with a high penetration rate, are mainly fueled by replacement needs. Zeng Wenli, General Manager of Povos, says, “Traditional appliances of this sector saw pretty good track record according to statistics from major e-commerce platforms. For example, the overall growth merchandize value amounted to 303 billion RMB and 403 billion RMB in the 3rd quarter and 4th quarter of 2017 respectively, with a respective growth rate of 32% and 33%, according to JD.com. Povos saw its hair dryers, hair care appliances, and shavers grow by more than 50% on e-commerce platforms.” Our reporter learns that, the market size of shavers came to 5 billion RMB and hair dryers 3 billion RMB on Tmall and JD.com alone.
Enterprises put a lot of efforts in traditional products too. “We learn from our market survey that our products must meet consumers’ both functional and aesthetic needs.” Zeng Wenli takes an example, “hair dryer makers develop new products based on the current market demands such as air volume, continuous speed variation, and LCD after the popularity of negative iron years ago.” We learn from our interviewee from Riwa that, “consumers’ demands change from individual functions to integrated functions. They are not as price-sensitive as before. Many consumers, particularly those in top-tier cities, do not see price as their major concern in shopping.”
Our reporter notices that, high-end products, for example those from Dyson, receive great market responses, making an impressive track record.
Comprehensive development is needed for a product to stand out
Technology is believed to be the core of products. Ma Hong says, “It plays a decisive role when consumers are choosing from products with same functions, and it is the key for a brand to stand strong.” An industry insider tells our reporter that, “This emerging market is full of copycats. As far as I know, a company owned by 3 people have rolled out dozens of models of products that carrying multiple brands through OEM and copying. If you don’t have core technology, you could easily be dragged into the mire of a price war.”
Marketing is another crucial issue. Zeng Wenli says, “personal care products differ from traditional home appliances in marketing since they target consumers’ beauty needs rather than rigid demands. I think product promotion is one of the most striking difference. Consumers know the functions of air conditioners and refrigerators, but might not know beauty care appliances and negative iron hair brushes. Thus the promotion of product function is one of the key area of focus. What’s more, we promote them mostly through the endorsement of renowned makeup artists and celebrities on social media, as a way of reaching out to their fans.”
China’s beauty and health care appliance market has a lot of potential to be unleashed. Technology and proper marketing will help enterprises to survive and thrive.