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Four key for the future of the beauty industry trends

May 23, 2024
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In 2022, the beauty market, which includes skin care products, perfumes, cosmetics, and hair care products, will generate approximately $430 billion in revenue. Following a strong recovery since the peak of the COVID-19 pandemic, the beauty market is expected to reach approximately $580 billion by 2027, and the industry is expected to grow at a compound annual growth rate of 6% between 2022 and 2027, indicating expansion across all segments of beauty products. This is on par with or slightly higher than other consumer segments such as clothing, footwear, eyewear, pet care, and food and beverage. Today, cosmetics and their related products are on the rise in all categories. It has proved resilient in the global economic crisis and volatile macroeconomic environment. From top financiers to A-listers, many people want to get involved in the beauty industry these days, and for good reason. The beauty boom has been hard to resist, attracting many new companies and investors. Brands must make differentiated choices to succeed in this ever-changing and increasingly competitive environment. This also poses challenges for brands in selecting supply chain and strategic partners. Excellent and reliable product factory will make brand owners get twice the result with half the effort. What are the four key characteristic trends in the cosmetics industry? How will brands choose their partners? How to deal with the complex challenges of the cosmetics industry? Let’s explore together.

beauty industry trends

A focus on inclusive products

A new generation of consumers demands more targeted products. This is reflected in inclusive products. Brands must embody inclusivity, not because it is fashionable, but because it is necessary, and inclusivity is the defender of a beautiful new era. Personal care for eczema, acne, thinning hair, grey hair, etc., should not be seen as atypical or abnormal, it is just a specific need that needs to be addressed, and care needs to be more tailored to these needs. Over the past decade, Americans have reportedly spent more than $500 billion on beauty products. By 2024, the Chinese are expected to spend more than $100 billion a year on beauty products. The beauty landscape continues to change rapidly as more and more digital-native, independent start-up brands launch specialized, niche product lines. It is vital for brands to have the right strategy and marketing in place to reach your target audience. Content involving non-binary, transgender, and gender-fluid beauty terms increased by more than 50 percent, and more than a third of Gen z said they personally know someone who uses gender-neutral pronouns. People think how to interpret “beautiful” is up to you, everyone deserves to be represented, regardless of skin type, regardless of gender, regardless of age, the future of beauty lies in diversity, and the beauty industry should also start from diversity. Formulators should focus on creating products that solve problems, satisfy needs, inspire joy, and work for everyone. For product marketing, the language used to describe these products needs to be overhauled to be inclusive. There are already some brands that have made their brand positioning and efforts for inclusive products. For example, Rihanna’s Fenty Beauty in 2017, with its 40-shade foundation line, was a first for inclusivity in the makeup industry. Inclusive diversity and a focus on corporate social responsibility (CSR) are both important. From the beginning, Fenty Beauty has embraced the principle of inclusion of all genders, body types, skin colors and involving the community in the development/improvement of the product. Brands looking for ways to improve should take note and learn that inclusivity is reflected in all aspects from the beginning. From the selection of raw materials (vegetarian, halal, regenerative, etc.), to the marketing language and product positioning for the target consumers.

cosmetics industry

The geographical advantage pattern of the cosmetics industry is gradually changing

Today, the beauty industry has cemented its reputation as a resilient industry that consistently offers high margins and new avenues for expansion. According to the latest report, the major players in the beauty industry will need to deepen their geographical diversification to maintain their reputation as an industry that always offers high profits and new avenues for expansion. As the United States becomes more competitive and the Middle East and Indian markets become hot spots, China’s dominance in the beauty industry is declining. The report estimates that by 2027, China will reach about $96 billion and North America will reach about $115 billion. While the US and China are expected to remain the industry’s heavyweights, other markets such as the Middle East and India are likely to play a bigger role in driving revenue than previously thought. Retail sales of beauty products in the Middle East and Africa are expected to reach $47 billion by 2027, driven in part by economic modernization and high household incomes brought about by new government programs. Driven by rising levels of disposable income and a younger generation of digitally savvy shoppers, retail sales of beauty products in India are expected to grow to $21 billion by 2027. Brands can also find opportunities by offering luxury beauty products and services to consumers, and the size of the luxury beauty market is likely to grow from around $20 billion to around $40 billion by 2027, according to the report. Through the above data, we can learn that the market for brands to expand their competition has become diversified. For brands, it is particularly important to determine the target market and deeply cultivate in the target market.

cosmetics industry

Healthy beauty becomes the key in the beauty industry trends

According to a new report, the $1.5 trillion global wellness industry is expected to expand retail sales at a compound annual growth rate of 10% between 2022 and 2027. The direction of compound growth will be reflected in an increase in the range of products that combine beauty and wellness. The majority of consumers in the United States, China and Europe plan to increase their spending on health products and services in the coming year. Health and self-care have gone mainstream, and consumers are looking for products that meet their aesthetic needs as well as their physical and mental health. Therefore, beauty products that are good for physical and mental health will become a new trend to receive attention in the future. For example, beauty products that prevent blue light radiation, beauty products that are helpful for sleep, beauty products that prevent solar radiation, beauty products that help soothe the body and mind, etc.

cosmetics industry

Consumer loyalty to the brand is closely related to the brand behavior

According to the Consumer Behavior Market Research report, 40% of consumers say they are loyal to brands they know and trust, while 69% say they like to try new products at least once every six months. The survey also revealed that consumers tend to buy in physical stores, which is their favorite way to shop, although it is closely followed by online shopping. Among Gen z consumers, 60% are willing to continue buying brands they like, and they are also concerned about brand sustainability. In the interview, when consumers were asked about the three most important sustainability aspects when purchasing cosmetics, respondents mentioned environmentally free ingredients, 100% natural formulations and cruelty-free production. Therefore, it can be seen that brands that focus on sustainability are more likely to gain the favor of consumers.

cosmetics industry

How should brand owners grasp these trends and do a good job in brand building?

When a brand owner creates a brand, several key points to consider are the expertise of the partner factory, product design, product marketing, market positioning and analysis. At this time, it is very necessary to one-stop brand customization services.

Guangzhou Xiran Cosmetics CO.,Ltd. has 15 years of experience in cosmetics brand customization, serving brands in many countries around the world, and customers on five continents. With a professional team of laboratory engineers and quality inspection team, there are thousands of mature formulations for customers to choose. Our company provides one-stop brand customization services from product formulation, product design, product packaging, product filling and production, product raw material control, product quality testing, market consultation and sharing. Let brand owners win at the starting line, according to the needs of brand owners and market trends to customize unique high-quality products and marketing programs exclusive to brand owners.

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