After several years of development, China’s June 18th (or “618”) mid-year sales period has evolved into the second biggest “holiday” for Chinese online retailers. 2020 was particularly special, as it is the first major eCommerce sales event after the coronavirus outbreak. Presales began as early as May 25th, and Tmall’s year-on-year sales growth rate increased 515% within the first hour, and cosmetics products exceeded 500 million within 7 minutes.
This year, sales actually began on the earlier date of June 1st. On that day, cosmetics products revenue exceeded 100 million within the very first minute of sales going live.
In the makeup market segment, products on Tmall sold over 6.39 billion in June, a 36% increase over June 2019’s sales of 4.69 billion. This shows that makeup products have not only bounced back after CoViD-19 but also resumed normal growth.
In this article, we analyze the performance of makeup market during the 2020 June 18th sales period, covering aspects such as brand market share, makeup subcategories, and best sellers within Alibaba’s marketplace ecosystem (Taobao, Tmall, and Tmall Global).
Best-Selling Makeup Product Category Analysis
The facial, lip, and eye makeup categories occupies most of the market share within the product segment.
According to Tao sj’s classifications, these three subcategories can be further subdivided like so:
- Facial makeup: liquid/cream foundation, primer/pre-makeup, powder/loose powder, BB cream, compact powder, concealer, highlighter, blush/rouge, contour
- Lip makeup: lipstick, lip gloss/lip glaze, lip pencil/lip liner
- Eye makeup: eyebrow pencil/powder/paste, eye shadow, eyeliner, mascara/eyelash growth
There are numerous subcategories within the facial makeup category, of which primer, foundation, and loose powder are most commonly used. These products tend to be consumed more on a daily basis, but don’t contribute as much to the final look. In fact, others can’t really tell the difference simply from looking a lot of the time. So consumers won’t be able to rely on other people’s opinion when choosing facial makeups. It one’s own experience that truly counts during decision making. Therefore, these basic products can gain consumer trust more easily among those relatively young and inexperienced groups who may not have developed any brand or product dependence yet.
On the other hand, market demand for products like BB Cream, concealer, highlighter, blush, and contour largely depend on the degree of consumer loyalty and trust in the brands entering the market. At present, there is still a lot of space for other brands to achieve strong market penetration. Overall, the facial makeup market has a respectably large current market, as well as demonstrating promising growth potential. That’s why we are seeing a large influx of foreign facial makeup brands joining the fierce competition on eCommerce platforms.
Lip makeup has fewer categories, with lipstick and lip gloss contributing most of the sales, and lipstick also accounts for the highest market share among all makeup subcategories. Lipsticks are one of the more iconic and visually obvious forms of makeup, so are usually the first makeup product purchased by young consumers. As demand from smaller Chinese towns and rural markets emerges, lipstick has solidified its position as an evergreen product category that remains popular today.
Lipstick and lip gloss display immediately obvious visual effects, so consumers can see the clear difference between products through product information pages or other people’s demos. Therefore brands face a relatively high entry barrier, and only a smaller number of them successfully get a foothold in the market. Emerging brands established in 2017 such as Perfect Diary and Florasis gained their own niche in the market by relying on their top selling SKUs within the lipstick category.
Distribution among eye makeup subcategories is relatively spread out, lacking a particularly prominent subcategory. Eyeshadow holds a small lead in sales revenues among eye makeup products, with strong makeup effect products such as mascara, eyebrow products, and eyeliner only slightly behind and sharing roughly the same sales revenue. Therefore we can draw the conclusion that the eye makeup market still holds a certain growth potential in both penetration rate and consumer familiarity. The recent success of Perfect Diary’s collaboration eyeshadow palette with the British Museum shows that there’s very much still space for new entrants to make a splash.
Brands Market Share Comparison
2019 TOP10 Brands
2020 TOP10 Brands
Among 2020’s top 10 brands, international and domestic brands shared an equal number of places, which is consistent with the top 10 in 2019.
Leading high-end international brands YSL, M.A.C. and Estee Lauder held onto their dominant market share thanks to offering products in a wide variety of product categories and thanks to their use of cutting-edge marketing strategies. While international drug-store makeup brands like Maybelline experienced a significant decline in market share under the impact of emerging domestic brands.
Relying on its “traditional Chinese style” concept and the “best seller focusing” marketing strategies, Florasis has quickly achieved huge success and reached the top spot for makeup brands in June by sales revenue, snatching some of Perfect Diary’s market share, another newly emerged domestic brand.
Two other new domestic darkhorses, Color Key and Little Ondine, entered the top 10 rankings, replacing CHIOTURE and OUYOUNG. Their success largely relies on their “best seller focused” marketing strategies and content operations. While Korean brand 3CE jumped into third place (replacing Armani) with its Asian-friendly colors, cheap pricing and down-to-earth content operations.
Among all eye makeup products, those ranging from 0-10 RMB perhaps unsurprisingly sell the most. According to Taobao’s data, most products in this range fall into the “face towels”, “cotton/cleansing cotton” and simple makeup tool subcategories within the category of beauty tools.
The majority of sales of lip makeup products are concentrated in the 50-100 RMB range, showing growing interest in low-cost makeup from small town and rural markets as well as from the student population. Lipstick and lip gloss products from domestic brands such as Perfect Diary, Florasis, Color Key, along with international brands like Kiko all fall into this price range. They grasped consumer preferences in these two major groups to achieve success. Through comparing the market share of the top 10 brands between June 2020 and June 2019, we can see a lack of strong consumer loyalty and stickiness to these brands within this price range, and hence generates intense competition.
Products within the 100-400 RMB range are also showing great potential. While targeted at the young adult population and the mature population, these brands have also seized upon the consumption-upgrade desires of small town and rural markets and the student population. However, from the changes in market share in June 2019 and June 2020, we can see that leading international brands such as YSL, Estee Lauder and M.A.C have already solidified certain levels of dominance in the high-end market, and developed high brand stickiness and loyalty among users, as well as creating certain market entry barriers.
Facial makeup has more subcategories than lip or eye makeup, but product prices are mainly concentrated in the 50-100 RMB range. Those above 100 RMB are mainly powder/loose powder, primer and foundation from international brands. Competition remains fierce among large numbers of incoming brands. Although facial makeups’ overall prices are relatively high among cosmetics products, consumers are not displaying significant brand stickiness or loyalty.
Unlike facial and lip makeup, eye makeup products mostly lie in the slightly wider range of 1-100 RMB. Domestic best sellers such as the animal eyeshadow palette from Perfect Diary have an average sales price between 50-100 yuan, while mascara and eyebrow products fall in the 20-50 yuan price range. Only a few eyeshadow products from the major international brands (such as 3CE’s eyeshadow palette) exceed 100 yuan, and these show significantly lower sales revenue and volume compared to newly emerging domestic brands.
Top 5 Makeup Products (by Sales Revenue)
1. Florasis air loose powder set makeup powder female long-lasting oil control waterproof and sweat-proof concealer natural
Sales revenue: 81,552,021 RMB (June)
Listed price: 149.9 RMB (June) 357 RMB (April)
Selling price: 149 RMB (June)
Sales: 547,329 (June)
2. Colorkey lip glaze velvet matte lip gloss female student lipstick Wang Ziyi’s selection
Sales revenue: 46,417,760 RMB (June)
Listed price: 130 RMB (June) 130 RMB (April)
Selling price: 63.02 RMB (June) (50% off for second piece)
Sales: 736,515 (June)
The average price of another domestic brand darkhorse – Color Key – was 63 RMB in June, and its product details page also shows a 50% off for second piece promotion, which means the average price of purchasing two lipstick of different colors is as low as 50 RMB. The target group of its products is also very clear: female students. Adding this keyword to the SEO product name also generates greater search volume.
For the student demographic, which only recently started wearing makeup, lipstick usually appears first on their radar. This is then quickly followed by lip gloss. Being able to try lip makeups with two different makeup effects for under 100 RMB is a strong selling point.
3. Compact Powder Makeup Control Oil Lasting Waterproof Concealer Loose Powder Dry Skin Oily Skin
Sales revenue: 44,663,364 RMB (June)
Listed price: 179.9 RMB (June) 179.9 RMB (April)
Selling price: 179 RMB (June)
Sales: 249,516 (June)
This is another top seller from Florasis, which is made from silk powder and boasts Italian craftsmanship. It claims on its product details that the product “does not contain any ingredients that may be harmful for pregnant women”, highlighting its superior safety level. Leading KOL Li Jiaqi and professional makeup artist Wang Jia also helped to promote it. The suggestions and tips they gave on using the product helped make it more approachable and beginner-friendly.
4. Estee Lauder DW long-lasting makeup liquid foundation for oily skin
Sales revenue: 40,765,140 RMB (June)
Listed price: 390 RMB (June) 390 (April)
Selling price: 390 RMB (June)
Sales: 104,526 (June)
This liquid foundation belongs to one of the leading international high-end brands, Estee Lauder. Its average selling price is around 400 RMB while maintaining high sales revenue and volume. The ultimate reason might be its outstanding product performance supported by Estee Lauder’s strong research and development capabilities. We can see considerable amounts of of positive feedback and video demos on RED, Tik Tok, and Bilibili. Its Tmall flagship store also prominently and confidently displays the product. Claims on the store suggest the product is “full day lasting” or even “24 hr lasting”. This also reflects the trend that consumers still believe in the high quality of international brands. This is especially true when it comes to foundation that has close contact with the skin.
5. Geoskincare Primer moisturizing brighten skin tone invisible pores watery authentic
Sales revenue: 35,581,900 RMB (June)
Listed price: 359 RMB (June) 249 (April)
Selling price: 98 RMB (June)
Sales: 363,710 (June)
When Geoskincare first entered the Chinese market from New Zealand, it did not draw much attention. Yet through years of accumulation from digital platform advertisement, it gradually reached more and more consumers. The brand also gained huge attention for its increase in sales during COVID19 over Chinese New Year 2020. This product’s huge success can be partly attributed to promotions from two of the country’s leading KOLs, Li Jiaqi and Viya.
Overall, the demand for makeup products remains high. This is despite a slight decrease at the beginning of this year due to Covid19. The 618 campaign further proves that as people are getting back to normal life, sellers are resuming marketing effort to consumers. The makeup market is back to thriving as usual, and once again has a bright future.
For those newly entered brands, success is also possible with the appropriate marketing strategy. Even reaching the top spots is not unattainable.
Recently, TMO launched a Makeup Industry Data Pack, which contains a large amount of first-hand data and horizontal comparison within the makeup industry, as well as inside information. New data packs are published monthly – click here to view June’s.