The APAC cosmetics and beauty market is expected to reach USD 177 billion in 2020 and to be worth nearly USD 190 billion by the end of 2021, according to the Euromonitor International. The continued desire for beauty and a widespread increase in disposable income  have driven industry growth. South Korea (K-Beauty) and Japan (J-Beauty) have a long tradition of and experience from  personal care and are with their innovative ideas and technologies regarded as global beauty trendsetters.

The coronavirus pandemic has changed consumer behaviour and buying patterns and the  following trends have been observed throughout the APAC region:

  • Increased demand for at-home beauty services
  • Sustainable packaging
  • Natural and organic ingredients
  • Direct-to-consumer technology
Increased demand for at-home beauty services

Due to the tightened distancing measures, the skin and hair care routine at-home has changed and advanced during the pandemic. An increasing number of consumers pay more attention to their skin and hair types and purchase personalised and/or premium products.

Companies launched ‘at-home care’ appliances with technologies and know-how by beauty experts. Those products are easy to use at home, even for consumers not familiar with such care, while having similar effects as from professionals.

With the trend of increased sales of self-care products, professional hair treatment, colorants, and related home appliances have boosted during the pandemic.

Sustainable packaging

Due to the increased use of single-use plastics during the pandemic, Asian consumers have become more and more aware of the impact that their consumption can have on the environment. It has led to a demand for a sustainable lifestyle and “ethical consumerism” among Millennials and Gen Z consumers. Beauty brands have therefore started to focus on packaging, which is a visible reminder to consumers of their products’ environmental impact. Amore Pacific, for example, started to develop products with natural ingredients and opened refill stations in 2020. Consumers can refill the hair care product in its own container or the one made with coconut shells at the station. Such initiatives benefitting from the sustainability trend will put the category leader in an outstanding position.

Natural and organic ingredients

APAC holds a huge potentialfor natural and organic cosmetics driven by the increasing numbers of Millennials and female employment. The concept is still new to the APAC region and consumers show growing interest in inartificial content. Cosmetics companies in Japan and Korea are focusing research and development on products that are safe for the skin and offer a prominent level of performance. They invest in selecting traditional and natural ingredients, adopting manufacturing processes that have a reduced environmental impact. It has become abundantly clear that brand initiatives favouring the planet influence consumer decisions. The compliance requirements and regulations for natural and organic cosmetic products may differ by country. It is therefore a requirement for companies to check this before entering the market.

Direct-to-consumer technology

Lifestyles in general, have become much more digitalised during the pandemic and the shift to online is reflected in the beauty industry. The industry has benefited from the increasing popularity of social media channels such as Instagram and YouTube. These media channels are not only highly influential among certain groups but create a demand for beauty products and help fill the gap between cosmetics brands and consumers. Especially, leveraging social media influencers with thousands of followers have become a common and popular marketing strategy. Consumers are not only looking at brand websites but are also monitoring social media platforms, regularly checking associated collaborations before making a purchase. Therefore, it is essential for beauty brands to make themselves easily accessible and tech-friendly.

We recommend Swedish cosmetics companies to consider:

  • Swedish branding and emphasisng on key ingredient(s): The beauty segment is demanding. With endless choices for consumers, they demand an appealing brand story, attractive packaging, and a great formula. Emphasising on key ingredients or a hero product can be a way to capture consumers’ attention. The Swedish origin associated with nature and clean environment can also be an advantage.
  • Understanding regulations and certification requirements:The skincare segment is a local business in all Asian markets (no unified standard like the EU) and there is a need for all brands entering a specific market to learn about the local regulations that apply depending on product category. Business Sweden’s local offices are offering support and advice to Swedish companies before establishing in the APAC region.
  • Use a hybrid model for sales: The fact that e-com is a driver for growth is true in all markets, although offline retail remains important for brand building. Finding the right local partners can help Swedish brands to establish or increase their retail presence. Business Sweden’s offices support partner recruitment and provide roadmaps for market expansion.  

Please do not hesitate to contact us to find out more about our experiences and how we could assist your company for a more in-depth analysis.

Linda Bradley, Trade Commissioner

Josie Ryu, Project Manager