Chinese women are much heavier users of skin care products, for example. Skin care holds a 70% share of beauty consumption there. In the U.S., by contrast, the use of skin care, color cosmetics and fragrances is fairly evenly divided.
Chinese women's skin ages differently than that of their American counterparts too. As a result, they require different product attributes. While western complexions show their age through fine lines and wrinkles, Asian skin ages through dark spots.
As a result, Chinese women are demanding that their skin care products lighten these spots and even out skin tone. (Lightening products are not the same as whitening products that also have become popular throughout Asia.)
Education is an important tool
Beauty is still relatively new to Chinese women, so education is a valuable tool for consumers--and an opportunity for marketers. Mao Zedong forbid the use of cosmetics until the 1980s, so beauty information was virtually non-existent until then. While today's western woman generally is initiated into the beauty ritual by her mom, Chinese women are dependent on outside sources for their beauty information.
Beauty companies have stepped in to fill the void and offer training and education programs to their consultants--the hired guns advising women at counters in department stores--and the customers. Amore Pacific, for instance, has a "lunch-and-learn" program created specifically for secretaries.
Manufacturers have invested in training beauty consultants and product tie-ins with Taiwanese beauty-related television programs. The payoff from these programs is evidenced by the fact that Chinese women are more likely to use all the products recommended to them. Toner use is particularly high (75%) compared to the U.S. market, according to a recent study by the Pao Principle, which interviewed 1,014 Chinese women who use beauty products, mostly aged 20-29.
Skin care starts early
Chinese women value a radiant, glowing complexion. Unlike many American women, they understand that using effective products early in life can positively impact their skin so good skin care habits start early. About 43% of the panelists in our study reported first using skin care products before 17 years of age, with 16.5% using skin care products before the age of 15, suggesting global beauty companies should position skin care messages for tweens. Few are doing so, however. With the exception of acne products, most current communications strategies are aimed at an older population.
Skin care is also a loyal category. When women find something that works, they generally stick to it, so speaking to women in their early teens should increase market share through increased trial and (hopefully) continuous repurchase.
Her family wants her to focus on her studies and not be distracted by extraneous influences. It is important to them that she gains entrance into a top university. Eight-four percent of our panelists first used color cosmetics between the ages of 18 and 25, and 74.8% started using fragrance during the same time span.
Unlike the U.S., mass and prestige brands live in the same environment. Due to the need for service and information, brands such as Maybelline, L'Oreal, Crème de la Mer and Estee Lauder live side by side in Chinese department stores--because the department store environment is well suited for education and training. Well over half of panelists in our study reported purchasing their skin care, color cosmetics and fragrance products in department stores.
While beauty brands may share the same channel, they are segmented by age and income. Prestige consumers are concentrated in Shanghai. They are older and tend to own their own business or work in middle management for a state-owned enterprise or a multinational corporation. Mass users are primarily students.
The power of word of mouth in China is huge. Forty percent of respondents cited friends and family as their primary source of information about beauty products. Many mainland Chinese prefer to keep their thoughts, opinions and personal information private. They find it difficult to trust outsiders because of their long history and previous experience where information was used against them. Chinese culture is centered on the family and many find it difficult to trust those outside this inner circle.
Interestingly, in limited cases, medical advice is also valued in selecting items such as toners, moisturizers, anti-aging products, foundation and mascara. When asked why they used a particular skin care or color cosmetics product, 20% of panelists said that it was because a doctor advised them to use it. Just as doctor brands dominated the U.S. market over the past ten years, doctor-created or endorsed brands have great potential in China.
Shiseido tops western brands
Unlike western women, who like to experiment with small, indie brands, the Chinese beauty consumer prefers to use big, well-known global brands. Shiseido was the most-used skin care brand by our panelists, due to the fact that Chinese believe that Japanese technology is the most cutting-edge. They also believe that Japanese skin is close to theirs and that Shiseido has the best understanding of their skin care needs.
I believe Shiseido's strong global brand image is another big reason for its success. For example, Amore Pacific, which is the top-selling brand in South Korea, has not been able to make in-roads into the Chinese market, because of its low brand awareness in both the U.S. and in Europe. In contrast, Shiseido is well known and respected in all of these markets.
Maybelline was the favored color cosmetics brand among our panelists, which is not surprising as L'Oreal Group has aggressively focused resources on all elements of the marketing mix in China. Specifically, sharp pricing, creative promotions, heavy ad campaigns featuring global and local celebrities and models and constant innovation have driven market share--although I wonder how long L'Oreal can sustain its current level of media investment. With fragrances, Chinese women clearly prefer designer products as evidenced by the huge popularity of Chanel No. 5, which was the most-used fragrance by the respondents in our study. They hugely admire the Chanel franchise and consider it an honor to have Chanel No. 5 adorn their dressing table.
Below are some results from the Pao Principle's latest study about beauty products in China.
Which skin care brand do you use the most?
Nivea Body 6.8%
Estee Lauder 4.2%
Mary Kay 2.7%
Which color cosmetics brand do you use the most?
Bobbi Brown 4.1%
Estee Lauder 3.0%
NYC NY Colour 2.8%
Which fragrance brand do you use the most?
Chanel No. 5 13.1%
Dior Addict 2 6.8%
Elizabeth Arden Green Tea 5.7%
Burberry Brit for Women 4.3%
Miss Dior Cherie 4.3%
Gucci Envy 3.9%
Bulgari Green Tea 3.5%
Anna Sui Secret Wish 3.0%
Anna Sui Dolly Girl 3.0%
Patricia Pao is CEO of the Pao Principle, a global business consulting firm based in New York.
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