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The retail transformation of Chinese beauty market

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Since late 2020, affordable beauty collection shops in China present growth trend. The freshmen track is full of variety of brands: some taking complete varieties as the core, some good at deep experience , some attracting consumers to shop, and others a blue blood, hatching in senior retail chain enterprises. The thing in common is that they started a prairie fire with a single spark: stores have expanded rapidly. COLORIST, WOW Colour have attracted numerous fans among young consumers, which has made capital overweight. A new generation of beauty stores such as B+ Oil T can and H.E.A.T. comes at the historic moment. Jove Sugar, Only&Write, growing from the traditional beauty stores, have witnessed a new round of industry iteration with a new model.

What exactly is an affordable beauty collection store?

In fact, affordable beauty collection stores are new beauty retailers. Compared with the old beauty retailers, these new beauty retailers tend to have the following characteristics:

1) Much noise is online, and Xiaohongshu, Weibo, Douyin and WeChat all are dominating the screen.

2) Each is with the characteristic web celebrity decoration style.

3) With less or without beauty consultants

4) The selected products have their own characteristics. The national trend, web celebrity and overseas niche brands are often their first choice.

5) Most of them have self-built digital selection data system.

6) The emphasis is on immersive deep experience and the new retail model of connecting online and offline.

7) In terms of customer base, it mainly targets young users such as Generation Z;

Affected by the epidemic, consumers, especially young consumers, have become more sensitive to prices. In this case, beauty collection stores targeting consumer groups are to provide relatively cheap makeup brands with good reputation, high performance from home, Korea and Japan, or samples from big brands with high gross profit .The strategy has achieved some effects. According to WOW Colour, 80% of consumers are unmarried women aged 18-28 and 66% are post-1995 generation. Although the average customer unit price is not high (50-300 yuan), but the consumption frequency is high, and the total consumption is high. On the whole, the prospect is considerable.


The decoration style of these affordable beauty collection shops is different visually from high-end and super-clean style of traditional beauty retail stores, either using woman's favourite color as the main tone, or pursuing star design, sense of science and technology, and the future sense, or adopting the minimalist industrial style or the warehouse one, each with individual characteristics and good appearance, becoming a web celebrity punch card place. And no matter what the design style is, generally speaking, the store has a large perfume wall, beauty blender wall, lipstick wall, etc., suitable for taking photos. Our products cover popular domestic brands and niche foreign brands, including skin care products, perfumes, lipsticks, masks and other categories.

The strategy "samples of big brands" is regarded as the core selling points of beauty collection shop, providing a compromise option for those who want high-cost brands but are so poor or worried that the products are not suitable for their skin. According to a report from the consulting company NPD Group, skin care products and cosmetic samples have grown into a huge market in the US, with $1.2 billion in sales in 2018. Now the strategy "samples of big brands" is starting to rally in China.

The traditional beauty makeup stores ,such as Watson, are being ridiculed as a result of the warm- hearted beauty consultants. So these beauty makeup collection shop are acting on the issues : customers won't be disturbed in the store, self-help purchase or try, enjoying adequate freedom of shopping. Only when you need help, shoppers will give consumers advice. Consumers can also add products on their mobile phones and pick up goods at the pick-up places, making the new beauty collection store a heaven for young consumers to buy beauty products.

It is not the "soul" of the new beauty makeup collection store if we only improve the store image and service mode.The ways they interact with consumers are more varied and more interactive.

B+ oil tank provides AR virtual makeup test, skin quality test and other services. As for the display, B+ oil tank products are innovatively classified by color number, texture, efficiency and other dimensions. Each category has two choices: brand names and alternative ones. When the products on the intelligent shelf are picked up and placed in the induction area, the screen will show the introduction of the products and the reasons for putting them into the jar.

McLory and Only Write have introduced the most popular "blind box" among young people, and McLory's 99 yuan opening box campaign has been a hit.



H.E.A.T. has also introduced the Mini powder press to allow consumers to make their own personal eye shadow palettes. Only Write also has a live broadcast room, a perfume room, a bath room and a make-up room in the store to attract web celebrities and younger customers to punch in. They offer consumers a one-stop shop, with the option to remove makeup in the store after having a try. The store also has a "boyfriend storage area" for customers to rest.

What does it mean for beauty brands?

In the past, speaking of consumers of the next generation, they tend be active in the report, but the hot beauty retail stores have confirmed one thing: the generation born in the period of country's rapid economic development, growing up in the wild growth of the Internet, has entered the shopping mall, began to unleash the power of consumption. A group of new generation brands and formats represented by the new generation of beauty cosmetics retail have become the contact points between shopping malls and the new generation of young consumers. Appearance level, personality and cost performance may soon become the next business development keywords, and the young customer group is the eternal target.

SKU of the new generation of beauty retailers are no longer attached to the big brand labels, but turn to niche brands and web celebrity brands, which makes them far more popular than the former. Instead of crudely introducing international brands or following trend and selling hot style, the new generation of beauty companies is adopting the strategy of big data selection, which means they sell whatever consumers buy in the current beauty market. As a result, in most of the new generation stores, there are many Internet brands that have never been involved in the offline market before. Today, with the increasing national cultural confidence, Chinese cosmetics are also entering the shopping center through the new generation cosmetics retail companies. In the display cabinets are the new choices of consumption with a very low degree of repetition with the old ones. Compared with the old beauty brands, these new beauty brands generally have the following characteristics: high cost performance, Chinese elements, and good performance online. The wide range of new brands and niche brands provide strong support for personalized consumption of beauty products. However, the established beauty retailers that over-rely on the supply chain ability and store expansion ability, in the era of oversupply, serious coiling and personalized market demand, will naturally be outdated.



Five years ago, consumers used to generate demand offline and compare prices online, with the final decision made based on trust and price. But today, what we observe is that more and more consumers stimulate shopping demand online and guide them into offline experience. The final decision depends on the on-site effect. During that period, the roles of online and offline have been reversed. Web celebrity brands which account for a large proportion of the new generation of beauty retail stores is making the pure DTC concept blurred. At the same time, due to the over-concentration of e-commerce platforms, the new generation of web celebrity brands are prone to be constrained by online platforms. They begin to pay more attention to shopping channels, which will become more irreversible with the monopoly trend of e-commerce platforms. In the above-mentioned channel and brand role transformation, we have noticed that the new generation of beauty retailers are gradually forming their own brands. As retail brands of department stores, they will play an important role as a bond of consumer trust and become an important channel for new brands to enter the market. And the industry that meets this condition may not be limited to beauty makeup.

With accurate positioning, dazzling scene, fine service and other characteristics, these beauty cosmetics retail newborns become the favourite of the market and capital. In the busier track, transformation is like a tornado, overwhelming and irresistible. Under the trend, niche beauty brands will see more and more opportunities.

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