16 Jul 2021
Posted in Consumer
Growing middle class to drive APAC make-up sector growth through 2025, says GlobalData
Rising disposable incomes and a burgeoning middle class are set to spur the Asia-Pacific (APAC) make-up sector at a compound annual growth rate (CAGR) of 6.5% from US$17.7bn in 2020 to US$24.3bn in 2025 , says GlobalData, a leading data and analytics company.
GlobalData’s report, ’Asia-Pacific Make-up Sector to 2025 – Market Size, Growth Analysis, Challenges and Future Outlook’, reveals that the face make-up category, which led the sector in value terms with 47.9% share in 2020, is projected to register highest value CAGR at 6.9% over 2020-2025.
The report identifies South Korea, Thailand, China and Australia as the high-potential countries based on GlobalData’s unique scoring system, which involves the risk-reward analysis derived from multiple metrics. These metrics include market size and growth analysis, besides the political, economic, social and technological assessment of 26 major economies in the APAC region.
Among the high-potential countries, China held the largest value as well as volume share in 2020. South Korea is expected to grow from US$1.8bn in 2020 to US$2.9bn in 2025, registering the highest value CAGR of 9.9%. Furthermore, South Korea is also expected to register the highest volume CAGR of 7.8% during 2020-2025, increasing from 102.4 m units to 150.4 m units.
Nilanjan Dutta, Consumer Analyst at GlobalData, says: “The APAC is expected to register high annual growth than all other regions during 2020-2025, on account of rising disposable incomes in growing economies such as India and China. Low-tier cities in China such as Tongchuan, Yingtan and Chuzhou are expected to play a pivotal role in driving the APAC make-up sector (globally largest) due to their rapidly rising middle-class population and significant purchasing power.
“Moreover, there has been an increase in online shopping in the region due to high Internet penetration in countries such as Japan and China. As a result, e-commerce is expected to play a key role in the sector’s growth over the forecast period.”
In the eye make-up category, all the high-potential countries are forecast to see a decline in consumption share during 2020-2025, except South Korea, which will see no change. The consumption share in the face make-up category is expected increase in Thailand and China while the consumption of lip make-up is expected to grow in South Korea and Australia. In the nail make-up category, only South Korea is forecast to record growth in consumption share.
L`Oreal S.A., Shiseido Company, Limited and Kao Corporation are the leading ‘make-up sector’ market players in the APAC region. ‘Novel & experimental’ and ‘added functionality’ are the top trends that get along very well with the APAC make-up sector.
Mr. Dutta concludes: “Aligning with today’s ‘wellness revolution’, consumers in the
APAC region are taking a more holistic approach to both their health and beauty. As a result, brands are capitalizing on ingredients commonly found in food and drink items and incorporating them into the beauty and personal care products. However, the natural cosmetics market in the APAC faces challenge in the form of ‘green washing’, with the brands making false claims of being natural or containing natural ingredients, which will affect the legitimate natural brands.
“Consumers across the APAC region are showing increasing interest in premium products as well as in products which help them save effort and time. Hence, manufacturers are launching new products that are easy and quick to use and help consumers manage and maximize their time.”