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Four Things Beauty Brands Must Know about China's E-commerce Market

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Although the global cosmetics market suffered greatly from the Covid-19 in 2020, the beauty industry in China continued to grow. The development and spread of e-commerce has played a crucial role in helping beauty brands in China withstand the risk.


There are over 600 million people who shop online in China in 2020, with the size of the online beauty market growing by 26%. According to iResearch, over 60% of GenZ consumers buy makeup and skin care products online. E-commerce channels have become the primary channels for cosmetics sales in China. It's crucial for members of the beauty industry, especially when you work for a brand targeting the Chinese market, to have a comprehensive understanding of China's e-commerce market.


In this article, I will help you figure out how cosmetics brands and beauty brands can stand out in China's e-commerce trends by introducing four things Beauty Brands Must Know about China's E-commerce Market.


1. Best E-commerce Platforms in China for Beauty Brands

2. Cosmetics E-commerce Marketing on Taobao, Tmall, and Xiaohongshu 

3. E-commerce Consumer Insights for Cosmetics Products Development 

4. Case Studies of Beauty Brand Strategies in China



1. Best E-commerce Platforms in China for Beauty Brands


1.1 Taobao  


Taobao under the Alibaba Group is a C2C online marketplace with millions of Chinese sellers and consumers similar to Shopify. As an open e-commerce platform, individuals can open their own stores on the website to sell various goods. For small-scale cosmetics retailers, Taobao can be an easy-to-access and easy-to-operate platform. However, as the entry requirement and the process of product quality check isn't strict enough,  products on Taobao are not as trusted as those on Tmall. 


1.2 Tmall Brand Store


Also owned by the Alibaba Group, Tmall is an online marketplace for B2C stores directly operated by brands and companies. Only legal business entities identified in China mainland can open a flag store on Tmall. In terms of database and UI, Tmall is highly integrated with Taobao. So when consumers are looking for quality-guaranteed items, they can simply filter the results by ticking "Tmall" to view products provided by brand stores only.  


Currently there are 268 official beauty brand stores on Tmall, including well-known brands of global beauty groups such as L'Oréal, Unilever, The Estée Lauder Companies, P&G, Shiseido, Coty, LVMH, Beiersdorf, and so on. According to L'Oréal China, its turnover through social e-commerce has doubled in 2020, and that e-commerce sales has contributed to 60% of its total yearly revenues. 


If you are to officially enter the Chinese market, Tmall brand store is undoubtedly the most valuable primary online stop! 👉 Check the ranking of your brand and product on Tmall.


1.3 Xiaohongshu (app)


Xiaohongshu (meaning "Little Red Book" in Chinese, also known as "RED") is another fast-rising Chinese platform which mergers the feature of social media and e-commerce. User Generated Contents (UGC) and e-commerce are Xiaohongshu's two-headed growth engine, but the key value of the platform is still contents. UGCs on Xiaohongshu are mainly consumer reviews (including reviews of products, lifestyle, experience, and so on). Among the TOP 3 content topics on Xiaohongshu, two are directly related with beauty brands: NO.1 skin care, NO.2 color makeup, and NO.3 parenting; and among the 200 million Xiaohongshu registered users, 90% are female users, 70% are born in the 1990s, and over 40% are born after 1995 -- all are main target consumers of cosmetic products.


Compared with official brand marketing, consumers in China nowadays find the word-of-mouth and real consumer reviews more trustworthy than ever before. From the color of lipstick to the function of essence products, Xiaohongshu is the first platform they turn to for advice. After purchase, Xiaohongshu users also have the habit to share feedback about the whole experience: from how they got to know this product, where they bought it, to how much the product has met their expectation.


If you want to find an effective channel to introduce your products to Chinese consumers and enhance your brand's online presence, you shouldn't miss Xiaohongshu. Although entering Xiaohongshu e-commerce store is not a bad move, the most effective way to utilize this platform however, is to increase brand-related contents and the regeneration of traffic. In the following Part 2, you will find out more about Xiaohongshu marketing strategies. 



2. Cosmetics E-commerce Marketing on Taobao, Tmall and Xiaohongshu


2.1 Taobao Live E-commerce 

China has witnessed the explosive development of live streaming e-commerce in recent years, especially after Covid-19. According to China's Consumers Association, around 70% of Chinese consumers use Alibaba's broadcast platform in 2020 to watch e-commerce live broadcast. It is estimated that the scale of China's live e-commerce industry will reach 961 billion RMB in 2020, accounting for approximately 8.7% of China's online retail scale. To help beauty brands catch up with this trend, we will keep updating tips for and trend of live e-commerce in out blog. 


Recent Seminar: Trend of Live E-commerce in China 2020 (🎬 with recordings)

Related topic: Online Sales and Streaming Boost Forestcabin’s Sales 45%


2.2 Tmall E-commerce: Double 11 and other Online Shopping Festivals


Online shopping festivals, among which Alibaba's Double 11 is the most popular oversea as China' Black Friday, contribute greatly to brands' annual e-commerce revenues. MeasureCommerce's e-commerce dashboard indicates that sales of beauty brands on Tmall went 2.9 times higher during Double 11 than usual. 

Double 11 Shopping Festival in China

MeasureChina E-commerce Dashboard


Apart from Double 11, there are also important online shopping festivals in March and June, as can be interpreted from the chart above. 👉 Check the big-sale timeline on Tmall to prepare in advance: Promotion Timeline of China's E-Commerce Platforms 2020.


It's essential for global beauty brands to actively join these online feasts. Despite the "luxurious" brand image, premium beauty brands such as SK II, Dior, Armani, YSL, and etc, have all played well in these online big sales with events including discounts, coupons, online concerts, limited products and so on.  To the opposite, brands less active in e-commerce marketing campaigns seemed to be encountering a hard time. From early this year, a group of once-popular brands including Etude House, Jurlique, and  Benefits all claimed to shut down offline stores in China. 


So what should beauty brands do in shopping festivals such as Double 11? When should brands start to prepare for it? What are the specific events to plan or actions to take?


* Double 11 Digital Marketing Strategies for Beauty Brands

   Tmall Double 11 Shopping Festival: E-Commerce Promotion Strategy Of Beauty Brands

   Beauty Ecommerce Trends: Brand Collaboration

   Single’s day series3: Limited edition and new launches of color makeup brands

   Single’s Day Series4. 2019 Single’s Day Cosmetics Brand Rankings

   Single’s day series5: Review of Single’s day 2019


* Case studies of beauty brands' e-commerce marketing strategies 

   Tmall Super Brand Day Brand Case Studies 


Tmall Super Brand Day

Tmall Double 11 Super Brand Day 


2.3 Influencer Marketing and KOLs on Xiaohongshu


Among consumers who actively share reviews on Xiaohongshu, some have even gained fans for detailed reviews and great recommendations. That's where the popular term "KOL" (Key Opinion Leader, or influencer) came from. From the color of lipsticks to the recommendation of products targeting various skin problems, the review of peers and from KOLs are increasingly influencing the choice of consumers. According to iResearch's GenZ report, over 42% young people say they turn to KOLs for recommendations and reviews of cosmetics products. 


The most effective marketing method for beauty brands on Xiaohongshu is, therefore, to cooperate with KOLs and increase reviews or recommendations of your cosmetics products. With more consumers getting familiar with your brands through viral contents of KOLs', you can then expect a "harvest" season with increased orders and even regenerated consumer reviews. Meanwhile, brands should follow up with the cosmetics trend and popular topics on Xiaohongshu, which can be a great hint of keywords in the marketing campaigns. 


For foreign-based beauty brands however, the problem is: who is the suitable Chinese influencer to work with? and how can we follow up with the latest trend and hot topics on Xiaohongshu? There are many KOL and influencer agencies in China that brands can choose, and brands can also utilize the data pool of Chinese influencers, or softwares providing real-time social media trends.


Related topic: Do Celebrity KOLs Actually Drive Sales In China? Sometimes.



3. E-commerce Consumer Insights for Cosmetics Product Development in China 


Now that I have shared a lot about the importance of e-commerce channels and e-commerce marketing strategies, what else can beauty brands get from e-commerce?  One thing too crucial to be left over is the consumer insight.


With the e-commerce statistics, cosmetics brands can not only check the performance of their own brand compared with that of major competitors in the Chinese market, but also gather the overall beauty industry insight and catch the minor rising trends. 


Below are a few examples of what we can do with the data of cosmetics:

3.1 develop best-selling sunscreen products with e-commerce insights


3.2 develop the most popular cleansing oil products with e-commerce data


3.3 Develop best-selling lipstick products with e-commerce statistics


3.4 Develop best-selling mask products with e-commerce insights


Check other cosmetics products categories at the report series: 3-MINUTE BEAUTY TRENDS


China Beauty Trend Report

China Beauty Trend Report (MeasureCommerce)


The cases above says a lot about how important e-commerce statistics and analysis can be for beauty brands. For every process of the cosmetics product development, from cosmetics ingredients to pricing strategy, from design to packaging, statistics help beauty brands deeply understand the needs of consumers, and make smart decisions. 



4. Case Studies of how Global Beauty Brands Compete with Domestic Brands


4.1 Unilever in China


One of Unilever’s greatest challenges in China  is to keep its brands ahead of competitors in China's quickly evolving e-commerce world.

"We have to use data because the competition in China — especially in e-commerce — is moving almost too fast, making it incredibly important for us to know what competitors are doing daily" said Wayne Wang, head of the Chinese e-commerce team for skincare at Unilever.

That's when Unilever started to round up e-commerce and social media trends in the Chinese market with tailored statistics and industry reports. From new cosmetics product development to competitor reviews, Unilever is now clear about what competitors are doing, and is confident about what to do next. 


Unilever in ChinaUnilever Dove 

👉 How Unilever Uses Data To Stay Ahead of Fast-Moving Competitors in China



4.2 Korean Beauty Brand Dr. Jart+ in China


Dr. Jart+ is a Korean cosmetics company with a global presence. They create premium skincare products that blend ingredient innovation with an artistic design aesthetic. For parent company Have & Be, their product development and business strategy in China is highly reliant on real-time market statistics and analysis, which has greatly contributed to its satisfying sales performance and reputation in China.


Dr. Jart+ in ChinaDr. Jart+

👉 How Dr. Jart+ Uses Real Time Data for Product Development and Promotion



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