Skincare leads the way in China's prestige beauty market

Skincare accounts for over 70 per cent of 2007's prestige beauty sales in China, and although makeup accounts for only 17 per cent of the market it is tipped to expand according to the market research company NPD Group.

Of the skincare products it is anti-ageing formulations that lead the category with the average price standing at 687 RMB ($92) said the group.

"In China, women are willing to pay a premium for anti-ageing skincare products and we are watching this category very carefully because we see it as the driver of the prestige beauty industry here," said the manager of the Chinese beauty division of NPD Edward Wang.

Likewise whitening products are an important category reflecting a wider trend across the Asian markets.

According to Wang the use of whitening products starts at a young age and continues throughout adulthood making it a particularly powerful category.

"This is a product that is more popular in Asia and we see this trend continuing to grow and gain strength in the coming years," he said.

The market research company has also highlighted makeup as an area of growth for the coming year, although at present its share of the market remains fairly small.

Wang notes that historically Chinese women have not been big consumers of makeup and colour cosmetics products, but increasing Western influence is leading to growing interest from Chinese consumers.

"More and more department store counters have enlisted sales people to help women use and try makeup, and it's been well received.

We believe there is a lot of growth in this emerging market in China," he said.

In contrast, the prestige fragrance industry is in its infancy according to NPD and Wang notes that cultural habits may be stalling the industry in a similar way to the makeup sector.

"Culturally Chinese men and women don't wear fragrance; it's just not a priority" he said.

The release of the report follows a similar study by NPD Group stating the importance of the prestige market in the US.

According to the report the prestige beauty sector in America continues to out-perform in an otherwise stagnant market, with spending for the first nine months of 2007 standing at $5.9bn representing 4 per cent growth from the same period in 2006.

However, unlike China it is makeup that is leading the sector accounting for 42 per cent of the total sales, with skin care, the sector leader in China, only making up 30 per cent of sales.