1. On March 29, Kuaishou E-commerce released a new announcement on the "Personal Care & Cleaning Industry Promotion Standards," which came into effect on April 6. The standard announced that medical terms are prohibited when promoting products; the term “big-name replacements” is forbidden; certain claims, such as cosmeceutical, stem cells, acid brushing, and medical skincare products, are banned.
2. On April 6, the Ministry of Industry and Information Technology released the Action Plan for Digital “Three Products” in the Consumer Goods Industry (2022-2025) (Draft for Comment), which intends to promote the implementation of the “Three Products” strategy of increasing varieties, improving quality and creating brands.
The "Plan" mentioned that by 2025, 200 smart manufacturing demonstration factories would be cultivated in the following industries, including food, household appliances, cosmetics, clothing, home textiles, electronic products, and other consumer goods sectors, and 200 well-known brands with a scale of 10 billion respectively will be built.
3. Little Red Book (RED小红书) recently released a report, Beauty Industry Future Consumption Inspiration Report, using data on RED to explore consumers’ shopping preferences. Here are some highlights:
More and more consumers pay attention to cosmetics ingredients, especially certain ingredients. Skincare method “Morning C & Night A” keeps trending on Red. “Morning C & Night A” means using cosmetics containing vitamin C in the morning while using cosmetics containing vitamin A at night. Related VA and VC products’ search index increased by 216% in 2021.
New rising categories include TSK’s Rouge Sur Mesure, eyebrow raincoats, scalp scrubs, etc.
Users are pursuing efficient skincare, so functional skincare products are popular.
1. Chinese makeup brand Florasis appointed its first CFO, April Fan, a former Morgan Stanley Executive Director. Florasis has never sought for any financing since its establishment.
2. Reckitt Benckiser sold its skincare brand E45 to Sweden medical care company Karo Pharm. In 2021, Reckitt Benckiser experienced a number of changes in brand management. It withdrew its investment in foot care brand Scholl and acquired German pain relief brand BIOFREEZE.
3. Two more beauty brands launched NFT products:
High-end skincare brand Guerlain launched a project named Reaverse, which will sell 1828 virtual bees connected in 1828 pieces of land in Vallée de la Millière natural protection zone in France. Based on the rare level of these bees, these NFT products will charge from €70 to €890.
Beauty brand M.A.C cooperated with Keith Haring foundation to release its first batch of NFT products. These products combine lipsticks with Keith Haring’s arts and are priced from $25 to $1,000.
Left: Guerlain's NFT Right: M.A.C's NFT
4. The parent company of The Ordinary Deciem closed four brands, including HIF, Hylamide, Abnomaly, and The Chemistry Brand. It will focus on operating its ace brand, The Ordinary, and its high-end brand, Niod. The Estee Lauder group holds the most share of Deciem (about 76%).
5. Japanese beauty giant the Shiseido group has launched its first digital makeup advisor. This AI advisor, developed by Shiseido and beauty technology company Reviveve, combines virtual makeup technology with personalized recommendations. It can analyze users' selfies to provide personalized product recommendations.
6. Chinese skincare brand HEPROA completed a new round of financing. This brand is founded by Professor Liu Zhigang, the former Vice Dean of Shenzhen University School of Medicine, and Professor Wang Zhiyao, Ph.D. in Immunology, University of Oxford. Backed up by a strong scientific and medical background, this brand gains traction with a focus on the skin microbiome.
7. D2C male care brand Geologie gained a 5 million dollars investment from Liquidity Group. This brand positions itself as a brand aiming to solve male consumers’ confusion about skincare. Consumers can get a customized skincare plan after doing a skin test on its official website.
8. Symrise released a new ingredient, SymFerment®, a postbiotic derived from the biofermentation process of selected Lactobacillus strains, which can bring an immediate skin moisturizing and smoothing effect, depresses skin roughness in only 4 hours, and improves the skin microrelief. It uses a supernatant (fermentation broth) which is rich in essential metabolites: amino acids, proteins, minerals & organic acids. This product can support filaggrin production for a strengthened skin barrier.
9. On April 19, the Chinese oral care brand Canban officially unveiled its children's brand CanbanKids, and specially launched a cartoon image IP, the bubble fungus family, to better connect with children. Canban is a popular oral care brand founded in 2018. Its products include mouthwash, toothpaste, oral spray, toothpaste, tooth irrigator, etc.
Cartoon IP launched by CanbanKids
10. Chinese hyaluronic acid giant Bloomage BIOTECH acquired a 51% market share of Beijing YEK Biotech. The latter is a high-tech company focusing on the development of collagen. The acquisition implies that Bloomage officially enters the collagen market.
11. Perfect Diary’s parent company, Yatsen Global, received a notification from the New York Stock Exchange that its American Depositary Shares (ADS) were trading below the price of compliance standards. This means that Perfect Diary must recover its share price and average share price above $1 within the next six months or face the risk of being forced to suspend and delist.
1. In April, the sales of imported baby sunscreen products on Tmall Global increased by more than 900% compared to data in February. It is a rising and promising sector worthy of attention. More details on ChemLinked.
2. L'Oreal released its 2021 annual report. The report shows that the global beauty industry grew by 8% in 2021, and the market size exceeded 228 billion euros.
Northern Asia is the largest market for cosmetics, accounting for 35.1%, followed by the North American market, accounting for 25.7%; the European market, accounting for 22.1%.
Global online sales of beauty products grew by 16%, with e-commerce accounting for about 24.5% of the beauty market, and compared to 22.8% in 2019.
L'Oreal mentioned that the popularization of social e-commerce, online content creators, and social interaction space are important aspects of the future development of e-commerce.
3. According to the National Bureau of Statistics, in March, China’s total retail sales of consumer goods reached 3.4233 trillion yuan, a YoY decrease of 3.5%. The total retail sales of cosmetics were 3.45 billion yuan, down 6.3% year on year, which was the first decline since March 2020. The main reason is that many factories have been affected by the pandemic since March.
4. In 2022Q1, China imported a total of 34.7 billion yuan of cosmetics and toiletries, dropping by 6.2% year on year.
L’ Oreal 2022Q1
1. Sales reached 9.06 billion euros, increasing by 13.5% like-for-like.
2. With double-digit growth in mainland China, L’Oréal continued to outperform the beauty market thanks to successful campaigns for Chinese New Year, Valentine’s Day, and Women’s Day. The group further strengthened its lead in the country, gaining market share online and offline. In Hainan, L’Oréal outperformed the Travel Retail market, which remained very dynamic.
1. Net sales of 20.3 billion dollars, an increase of 5% versus the prior year.
2. Beauty segment organic sales increased 2% versus a year ago. Hair Care organic sales increased in the low single digits due to pricing and a favorable mix of premium innovation in treatments and conditioners. Skin and Personal Care organic sales increased in the low single digits, primarily driven by pricing and higher volumes, partially offset by a negative geographic mix.
Johnson & Johnson 2022Q1
1. Sales were 23.4 billion dollars, increased by 5%.
2. The Consumer Health department, containing the cosmetic business, recorded 3.586 billion dollars, dropping by 1.5%, the only department that recorded a decline. The decline is driven by supply constraints in the U.S. and other areas.
1. Turnover was 13.8 billion euros, with a YoY growth rate of 11.8%.
2. Beauty & Personal Care underlying sales grew 7.1%. Deodorants posted high single-digit growth, helped by technology-driven innovations behind Dove and Rexona, as well as Axe making a strong start to the year. Skin cleansing delivered high single-digit growth with Dove, Lux, and Lifebuoy performing well, but volumes declined in a contracting market. Skin care grew low single-digit, driven by North Asia and South Asia while sales in North America were flat. Prestige Beauty had another quarter of double digit-growth, on top of a very strong prior year comparator.
3. China delivered mid single-digit, volume-driven growth with continued momentum from eCommerce and a strong quarter in skin care and ice cream.
1. The group’s consolidated revenue reached €2,765 million in the first quarter of 2022, up 33% at current exchange rates and 27% at constant exchange rates.
2. Perfume and Beauty (+18%) are driven by the house's creations and olfactory proposals. The Hermès Beauty line launched a fourth chapter in March with a new approach to the complexion Hermès Plein Air.
1. The group recorded revenue of 18 billion euros in the first quarter of 2022, up 29% compared to the same period in 2021.
2. In Perfumes & Cosmetics, organic revenue growth was 17% in the first quarter of 2022 compared to the same period of 2021. The business group enjoyed excellent momentum thanks to sustained growth in perfume and makeup, particularly in the United States.
1. In 2021, operating income was 4.633 billion yuan, an increase of 23.47% year on year. In 2022Q1, operating income was 1.254 billion yuan, a YoY growth rate of 38.53%.
2. Online channel revenue totaled 3.924 billion yuan, accounting for 84.93% of the total revenue, a YoY increase of 49.54%.
1. On January 7, 2022, China National Medical Products Administration (NMPA) issued the finalized Good Manufacturing Practices (GMP) for Cosmetics and will implement it on July 1, 2022. Cosmetics registrants, notifiers, and entrusted production enterprises shall organize the cosmetic production in accordance with the Practices. Following that, on March 30, 2022, NMPA released the draft of Inspection Points and Judgment Principles of Cosmetic Good Manufacturing Practices for public consultation. Regulatory authorities across China will use the Points as a basis to determine whether the enterprise complies with GMP. More details on ChemLinked.
2. China National Institutes for Food and Drug Control (CNIFD) is inviting public submissions regarding the draft of the Safety and Technical Standard for Cosmetics 2022 (STSC 2022).
STSC 2022 inherits the basic framework of STSC 2015 but overhauls the original content, which includes revising the content that is not suitable for the current supervision practice, retaining the content that is still applicable, incorporating the previous revisions for STSC 2015, as well as standardizing and improving some terms and expressions. More details on ChemLinked.
3. China’s first regulation on children cosmetics, Supervision and Administration Provisions on Children Cosmetics, came into effect on January 1, 2022. Four months later, on April 11, 2022, China National Institutes for Food and Drug Control released the draft of Technical Guidelines for Children Cosmetics for public consultation. More details on ChemLinked.
4. On April 8, 2022, China NMPA gave further interpretation on the submission of annual report and supplementary information of notified cosmetics to help cosmetic stakeholders better comply with the new regulatory requirements. More details on ChemLinked.
5. Two new cosmetic ingredients (No.007 and No. 008) got the government’s approval,β-Nicotinamide Mononucleotide and Zinc Hydrolyzed Hyaluronate.