With many salons closed for months in 2020, there was a significant rise in demand for DIY beauty products, such as peels, masks, and waxing kits. For instance, a 2020 study by the National Library of Medicine stated that the use of cosmetics harms the human skin and can lead to pigmentation and skin problems as some of these substances could also have harmful, irritating, and allergic effects on human health. The highly visual nature of the beauty industry makes video marketing a critical strategy for brands. Opinions expressed by Forbes Contributors are their own. The face segment is expected to dominate the market as most of the consumers apply creams and powders on face compared to other body parts, which increases its demand in the market. Major countries in each region are mapped according to their revenue contribution to the global market industry. Virtual try-on tech leverages augmented reality to allow shoppers to test how different beauty products will look without needing to reach for the makeup remover wipes afterward. As a Premium user you get access to the detailed source references and background information about this statistic. ET by Tomi Kilgore. As consumer values and expectations shifted, big beauty corporates and startups alike have been forced to adapt. Some beauty brands are even carrying out clinical studies to test out their products: Juice Beauty and ZO Skin Health both feature real patients results from clinical laboratory studies on their websites. A. Email marketing allows brands to connect directly with customers in ways other marketing strategies cant. Moreover, online sales channel has increased consumer reach, making it key source of revenue for many companies. In spite of an unprecedented crisis of supply in 2020, the global cosmetics market is a dynamic market which saw a significant recovery in the second half, driven by strong consumer demand. Sixty percent of the Google page one rankings for product keywords are for websites that dont even sell skincare products. Another important factor in a successful omnichannel experience is the ability for store associates to connect with customers online. The top six market share holders for informational searches are publications. Hypermarkets/supermarkets are gaining popularity, owing to availability of a broad range of consumer goods under a single roof, ample parking space, and convenient operation timings. So, where do some of the top beauty brands and retailers rank in terms of organic search market share? Beauty trends come in cycles. Going forward, the beauty industry will continue moving beyond empty buzzwords like clean and natural and instead get down to the nitty-gritty of specific ingredients and their effects. Copyright 2023 CB Information Services, Inc. All rights reserved. This includes Asian beauty markets like China, which is a hotbed for virtual beauty thanks to its advanced mobile technologies and tech giants. Around 11% of beauty and health online shop users in the United States say they are likely to use Mac Cosmetics again. Brands like Sephora and Ulta, in comparison, perform much better than the traditional beauty brands in organic search. Furthermore, indie brands often succeed in the areas beauty corporates dont, namely niche categories, targeted distribution, and social media prowess. The only cosmetics market that recorded growth in 2020. Its especially important for ecommerce and direct to consumer (DTC) brands that dont have physical retail locations. In-house incubators offer a way for conglomerates to build relationships or even gain equity stakes in these companies paving the way for future acquisitions as it becomes clear which early-stage brands will mature and which will fizzle out. Although COVID-19 shifted consumer shopping behavior patterns within the beauty industry, theres no doubt that the industry will continue its current growth trajectory. Overall, the No. For instance, in April 2022, RENEE Cosmetics, an Indian cosmetic brand, announced the launch of its new product range called Face Base for Indian skin types. As a result, youll create a stronger bond between your brand and your customers. For instance, in August 2022, Ponds, a beauty brand from Unilever, a British consumer goods company, launched its natural glow face powder which is made from ingredients such as titanium dioxide and zinc oxide that have UV protection properties. The global makeup market size was valued at USD 40.37 billion in 2021. In addition, growth in consciousness about external beauty along with individuals internal intellect has become one of the major driving factors for use of cosmetics in the global market. Ascending at a CAGR of 5.61%, the global market will exhibit steady growth over the forecast period (2022-2029). In 2020, Deciem nearly doubled sales to $460M, primarily through its skincare brand The Ordinary, which has developed a strong cult following. Instagram is not the only company using video to sell beauty products. It even opened a brick-and-mortar hair salon to showcase its tech. Ingestible beauty is one wellness area gaining traction. In addition, the popularity of premium beauty products among women and millennials is driving the makeup market growth over the forecast period. Social media has become a critical way for teenagers to find the trendiest products in line with their clean beauty needs and beyond edutainment for beauty and skincare products. Based on our analysis, the global market exhibited a decline of 14% in 2020 as compared to 2019. Synthetic biotech company Amyris recently acquired a majority stake in sustainable cosmetics brand EcoFabulous the seventh clean beauty brand in its portfolio. Often, it can be cheaper to incubate or accelerate new companies (that could serve as potential partners or acquisitions down the line) instead of developing in-house brands. In fact, it can range from natural product development, to cruelty-free products, to products created with sustainability in mind. Increasing Inclination Toward Personal Grooming to Favor Market Expansion. In recent years, one of the biggest ways ingredient transparency has manifested is through the clean beauty movement, which focuses on natural and organic products. Companies that sell clean beauty products can expect to see a surge in demand moving forward. Currently, beauty juggernauts are looking to indie brands to experiment in newer markets and nascent trends. The increasing collaboration of market players with different brands and stakeholders to provide a variety of products along with improving their supply chain management is propelling the regions demand for cosmetic products. But thanks to new on-demand technologies, beauty services are no longer tied to traditional locations. LOral signed a licensing deal with biotech bacteria company Micreos, while Este Lauder inked a joint development deal to explore lab-based materials in skincare. Going forward, expect a greater focus on the connection between gut health and beauty as the microbiome gains momentum as a wellness topic. Total global cosmetic sales in 2020 was a whopping $483 billion. Sustainability is a hot topic across virtually every sector, but its become a particularly important conversation within CPG, an industry with replenishable products historically featuring single-use packaging. A. In January 2021, Hims & Hers which launched as a holistic male wellness brand through its suite of haircare, skincare, and supplement products but has since expanded to womens wellness went public in a $1.6B SPAC deal. Additionally, players are focusing on strengthening online and offline distribution to expand its presence. Hair color has seen a notable boost in the past year as lockdowns have prompted new forms of self-expression, per Sally Beauty Chief Merchandising Officer Pam Kohn. Previous perks have included MAC Cosmetics coupons for 25% off storewide and a free gift with orders of $65+. The makeup category suffered losses, especially among teens, with Piper Jaffray reporting a 21% year-over-year decrease in spending among that group. Chemicals used in the production of cosmetic products can harm an individual's skin and the daily application of these products could be dangerous. Each virtual look is created based on whats trending and popular near each respective store. There is still no [cosmetics] company that has been able to integrate personalization into their business models, Shiseido president Masahiko Uotani said in an interview with the Nikkei Asian Review. Collectively, all strategies adopted by manufacturers drive the global cosmetics market. Beauty conglomerate LOral (which set up the first beauty startup accelerator in Africa in 2018) offers a variety of internal initiatives to support its commitment to new brands and technologies, such as the Open Innovation Program, the Women in Digital program, its Technology Incubator, and the launch of corporate venture capital fund LOral BOLD. Analyzing a16zs investment strategy in consumer & retail tech: Where did the VC place its biggest bets in 2022? These technologies have caught the eyes of top beauty investors. Excessive use of certain creams and powders and hair coloring products can result in rashes or patches on the skin and permanent hair graying. This also helps in increasing revenue of companies operating in this industry. Leading beauty brands In 2020, the leading beauty manufacturer was French cosmetics company L'Oral, which recorded $33.93 billion in revenue. In 2020 the company invested in the social commerce software company, Replika Software, in order to increase ecommerce sales and peer-to-peer selling. But its place in the beauty world is more secure than ever. The 6 Biggest Issues Facing the $532 Billion Beauty Industry The beauty industry experienced deep pain over the past year as it saw some big shifts. The market research is offered along with information related to key drivers, restraints, and cosmetics market opportunities. Skincare brands from Aesop to Ursa Major to Non Gender Specific have ditched gendered marketing, opting to package and sell unisex products that focus on specific skin concerns or conditions instead. During the survey, the questions were phrased as follows: Dior J'adore evaluation in the United States 2015, Gucci by Gucci evaluation in the United States 2015, Giorgio Armani Si evaluation in the United States 2015, To download this forecast you need one of our Business Solutions. A. Sephora, for instance, partnered with Google to offer its own Google Assistant app that allows users to order products, access skincare advice, and view Sephoras YouTube videos. Voice assistants like Amazons Alexa and Apples Siri present partnership opportunities for big tech and beauty. It goes far beyond making sure ecommerce pages are optimized, although that certainly matters. Meanwhile, tools like Essies ModiFace-powered On Hand tool and Anastasia Beverly Hills The Brow App offer applications in nail polish try-on and brow shaping. Key players focus on launching new facial skin easing products developed according to the need of different skin types, supporting the segmental growth. Since the COVID-19 pandemic, use of the tool has exploded, with millions using it to virtually test different products. }); More than a year later, Covid-19 continues to shape the space, but brands are now better equipped to deal with the seismic shift in consumer values and expectations. 2022 Annual Report. These companies formulate and package products to improve convenience and user experience, which eases consumers into using more sustainable products without changing their routines to accommodate, for instance, scoopable shower gels or chewable toothpastes. Traditional brands and beauty retailers are losing ground on product-related searches as well, when consumers are actively looking to purchase. Much of the beauty livestreaming activity in Asia has been driven by high-profile influencers known as KOLs (key opinion leaders) like Lipstick King Jiaqi Li, who reaches millions of viewers every month. This has led more brands to partner with a broader range of influencers. Beauty and CPG incumbents should look to use investments, M&A, or partnerships to bring these tech innovations in-house to help achieve broader sustainability goals. formId: "6249b226-16fe-449e-89bb-234c2fdc506f" the media outlets selected for the campaign are highly relevant to the market base. They simply lack the SEO strategy and long-form content needed to compete effectively in Google. In addition, rising establishment of mega stores and brand stores in developing countries such as India, China, and others and the availability of a wide range of cosmetic products is augmenting the market size. Based on application area, the market is segmented into lips, eyes, face, and nails. Custom printing, in which companies formulate products specifically for each user. to provide the most effective ingredients for users. Start reading instantly.This Report and over 29,716+ more Reports, Available with Avenue Library. 2021 Annual Report. To tap into this massive market, among others, grants and accelerators for founders of color have emerged over the past year, including Glossiers and LOrals grants to Black-owned businesses and Sephoras recent accelerator cohort, which included only founders of color. Stay abreast of your interest areas. The North America market share is expected to increase at a CAGR of 6.50% in the near term. Nowadays, self-care has become an integral part of a daily routine for a large number of individuals as it enables highlighting facial features such as eyes and lips and thereby provides an efficient method for grooming. All prices in USD, To ensure high-level data integrity, accurate analysis, and impeccable forecasts, On-demand customization of scope of the report to exactly meet your needs, Targeted market view to provide pertinent information and save time of readers. The Asia Pacific region dominated the global market in 2021. Macerich stock price target cut to $11 from $30 at J.P. Morgan. [Online]. Haircare startup Prose, for instance, recently launched a subscription service for supplements which it says can prevent hair loss and promote healthier scalps. Perfect Diary dropped an eyeshadow collaboration with the Metropolitan Museum of Art in 2019 and signed Australian singer Troye Sivan as an ambassador. At-home devices, which can measure user conditions, like the emergence of dark spots or surrounding environmental concerns, on a daily basis. Expect to see livestream shopping becoming more popular in the US after already taking off in China. Read our deep dive into SEO vs SEM here for a more thorough comparison. After seeing the success of independent players such as vertically integrated incubator Seed Beauty, which is behind ColourPop, Kylie Cosmetics, and more big beauty corporates have followed suit with their own incubators and accelerators, with examples including: LOrals Seed Phytonutrients and Unilevers Skinsei are just a few examples of internally incubated brands. We use cookies to enhance your experience. Is your brand doing what its going to take to win in the future? Mac Cosmetics is partnering up with the Whitney Houston Estate to launch a makeup range. Convergence of advancements, beauty, and lifestyle propels growth of the market. Total global beauty industry spending in 2020 was $483 billion, and the annual total is expected to top $716 billion by 2025. The base year calculated in the cosmetics market report is 2019. TikTok especially is gaining traction as a beauty product education and exploration platform, boosting sales when products go viral. Show publisher information A few brands are working to cater to older consumers, such as Gen Xers or baby boomers. But the beauty boom isnt limited to K-beauty; other markets are garnering attention for their own heritage-inspired products. The positive stance of the producers in the region supported by short term loans provided by the government along with other facilities, are raising the product demand in these regions. Over the long term, SEO is better than PPC, providing both compounded returns and a much higher ROI. Meanwhile, Facebook-owned Instagram has become a strong retail force within the beauty industry. Only three of the top ten are beauty retailers. In makeup, Amazon ranked slightly better in position five. Historically, many products allowed for only a limited range of skin tones. On the basis of category, the market is divided into skin and sun care products, hair care products, deodorants & fragrances and makeup & color cosmetics. Already popular in Asia, the trend of food, supplements, or drinks promising beauty benefits has continued to pick up steam. Touch device users, explore by touch or with swipe gestures. The online channel for beauty in the U.S. grew by 5.6% in 2020, while off-line sales contracted by 1.2% in the same year. These platforms typically include tools for booking and managing appointments, showcasing their work, and accepting payments. After testing a virtual concept store in Shanghai last year, MAC saw huge success. The key players profiled in the cosmetics market report are Avon Products Inc., Kao Corporation, LOreal S.A., Oriflame Cosmetics S.A., Revlon, Inc., Shiseido Company Limited, Skin Food Co., Ltd., The Estee Lauder Companies Inc., and The Procter & Gamble Company and Unilever Plc. We know where we will be getting business intelligence from in the future., Thank you for sending the market report and data. Biotechnologies are increasingly impacting the production of beauty ingredients. For many, the conditions of the pandemic drove them toward product categories like skincare (and away from those like makeup) that play a central role in at-home routines. Ultimately, brands that can cater to these demographics without oversimplifying the nuanced dynamics of their communities will be more likely to succeed in the increasingly saturated beauty market. Few forms of brand marketing are more effective than Word of Mouth (WOM). Tutorials, comparisons, and behind-the-scenes are simple, yet effective ways to build rapport with an audience. Consumers especially millennials and Gen Zers are leading the shift away from single-use plastic. Black consumers account for $1.3T in buying power; the Black haircare industry reportedly represents a $2.5B market. In the physical Shiseido flagship store, customers wear connected wristbands that scan product signs and add items to digital carts. As the trend continues to gain traction, understanding the difference between niche and underserved audiences remains crucial, as there exist many demographics with untapped potential. Use of cosmetics by men is expected to eventually increase and in turn supplement growth of the global cosmetics market. Topicals and Musely, for example, are targeting skin conditions like eczema that would normally require a trip to see a specialist to get a prescription. It looks quite comprehensive and the data is exactly what I was looking for. Perfect Diary uses the same production factories as large, reputable luxury brands like YSL and Dior. Remarkable job and great efforts by your research team. Global digital advertising spending is increasing year after year, accounting for a growing proportion of total media spending, estimated to average almost 54% worldwide in 2020. According to perspective of top-level CXOs, innovation is the key for growth of the cosmetics market, in terms of value sales. A market in which L'Oral is the global beauty leader. In fact, Dotdash, the parent company of Byrdie, invested more than $50 million into content over a three-year period across their publishing portfolio. The videos should also be a mix of promotional and informational, with the emphasis falling on informational. Emerging startups and recent corporate developments here include: Expect to see more major retailers stocking these options in an effort to bring sustainable products under the roof. Ultimately, the ingredient transparency trend will likely go more mass market and global across all consumer products. In 2020, LOral rolled out Signature Faces, a line of virtual makeup products. The line provides makeup filters supported on a range of platforms, including Zoom, Instagram, Snapchat, and more. Apart from this, the online segment is anticipated to hold the fastest growing CAGR during the forecast period owing to the rapid boom of e-portals during 2020. I appreciate the timeliness and responsiveness of you and your team., (applicable to 1 report only for the same license type). Tech is playing a bigger and bigger role in the beauty industry. Get detailed COVID-19 impact analysis on the Cosmetics Market. For instance, in May 2021, Huda Beauty, a cosmetic brand headquartered in Dubai, UAE, announced the launch of its new cosmetic collection, GloWish. "Mac Cosmetics brand awareness, usage, popularity, loyalty, and buzz among beauty and health online shop users in the United States in 2022." Although MAC inspired countless cosmetics brands, they still retain the largest ecommerce market share in the cosmetics industry, especially in lip products. While the technology has existed for some years, the Covid-19 pandemic has solidified virtual try-ons place in the beauty industry, as customers seek personalized recommendations they can try on safely, often while shopping online from their own homes. Get insights on topics that are crucial for your business. Already, the countrys male skincare market was more than twice the size of South Koreas and more than three times the size of the US market as of last year, per Euromonitor. maccosmetics.com's audience is 24.35% male and 75.65% female. 2020 was a redefining year for every industry including beauty. Perfect Diary remains focused on targeting lower-tier cities, where customers may be less accustomed to the beauty market and more open to trying out new brands. Bottom line, beauty brands are missing out on a major opportunity when it comes to organic search traffic. Terakeet analyzed 3,168 high-value, non-branded beauty industry search queries, which account for 112.7 million annual Google searches in the U.S. Conversely, some brands are looking to offer consumers an alternative to doctor visits for certain issues. LOral, for instance, has credited its diverse pricing strategy for enabling it to absorb even severe market conditions like in 2020.. CeraVe, e.l.f. after the death of one of the founding Franks, they bought the remaining share. Consumers are continuing to realize that not all synthetic ingredients are detrimental, and that biosynthetic ingredients offer a viable, more sustainable alternative. Japans Shiseido exemplifies the omnichannel approach. Local D2C brands are popping up to capitalize on the opportunity at least 10 new China-based male skincare brands were reportedly launched in 2020. Statista. Who are the leading players in the global market? New York, NY 10018. Now, consumers can bring the spa directly to their homes. Furthermore, 17 of the top 22 performers are publishers, capturing 62.3% organic market share. DNA testing kits, which allow companies to provide product recommendations or create custom products based on users genes. Presently, cosmetics have become an indispensable feature of modern lifestyle of individuals. Following 2020s spotlight on racial justice and equity, a newfound focus on funding diverse brands has emerged as well. Some examples of amazing digital customer experiences include: For example, Ultas Glam Lab lets customers see what theyll look like using different types of color cosmetics like mascara and eyeshadows, as well as with different hair color or eyelashes. Historically, the lions share of beauty products have been purchased in brick-and-mortar stores, but thats changing rapidly, with online sales projected to make up 48% of the total by 2023.
