John Chave, Director General at Cosmetics Europe – The Personal Care Association (left), Zhaoyang Cai, Founding partner of Chaileedo (right)
Customs data shows that in the first three quarters of 2023, China’s exports of cosmetics and personal care products amounted to 34.861 billion yuan, marking a cumulative year-on-year growth of 26.6%. China’s cosmetics exports are thriving.
At the same time, how Chinese cosmetics brands evolve from quantity to quality, and their positioning on the international stage, has become a new topic of this era. During the 2023 FORUM ON BEAUTY ECONOMY AND SUSTAINABILITY, ONE OF ZGC FORUM SERIES OF ACTIVITIES, the “Trends Discussion” column, with a keen eye, interviewed representatives from ASEAN member countries such as Myanmar, Thailand, Malaysia, as well as leaders of cosmetics industry associations from France, Europe, and other places. They dissected global trends in the beauty market and key regulations, aiming to support companies in their international expansion. During the forum, John Chave, Director General at Cosmetics Europe – The Personal Care Association, granted an interview to CHAILEEDO.
CHAILEEDO: Based on the retail sales price in 2022, Europe is the flagship market for cosmetics and personal care products globally, with a value of 88 billion euros. Could you give us an overview of the cosmetics market in Europe, including market size and major brands?
John Chave: We’re now the second largest. We’ve been overtaken by the United States. So that is a little bit of a concern because we want to ensure that the industry continues to grow and prosper.
In Europe, but of course, it’s still a very significant market. The major brands are the brands that you are familiar with, I’m sure. In China, what is not always appreciated is that there are many small and medium enterprises in the European market, around 8000 particularly if you look at countries like. Italy, France, the UK, Germany, Spain, and Poland. SMEs are a very important part of cosmetics and personal care.
CHAILEEDO: Which country stands out the most in terms of retail sales price?
John Chave: The retail sales are strongly correlated with the size of the particular market, so Germany is the largest market. Germany and, the UK, which are not in the European Union, but a part of the European market, defined Spain, Italy, Poland, and France. These are the biggest markets in Europe.
CHAILEEDO: like in China, skin care is more is very gross, very rapidly in recent years than makeup. This is the most significant characteristic in the Chinese cosmetic industry and how about Europe?
John Chave: During the COVID period, there was a significant contraction for some parts of our sector, not all because of hygiene products, but of cosmetics. Hygiene products continued to grow during the covered period. But I think in Europe, as in any other place in the world, some of our categories suffered. But there has been a general rebound now across all categories in Europe are growing faster than others, but generally, growth is around all categories.
CHAILEEDO: Currently Chinese brands are experiencing a trend of going global. If Chinese cosmetic companies want to enter Europe, which regions do you recommend?
John Chave: Well, I think there are two points here. Firstly, of course, Chinese cosmetics companies should look at the biggest national markets, and those are the ones that I referred to. Germany, France, Italy, the UK, Spain, and Poland are where there are most consumers sell Chinese cosmetic products.
Two, I think it’s important to understand that it’s relatively easy to enter the European market from a regulatory perspective. Because there is a single regulation, if you’re selling Chinese cosmetic products in Germany Italy, Spain, or anywhere else, you’re applying a single regulation that applies to every country within the European Union. And that’s an advantage because it means that the regulation, of course, we have to comply with the regulation, but it’s clear and stable and applicable everywhere within the European Union.
For Chinese companies entering the market, there is a degree of regulatory certainty, which is, of course, like any other market, it’s important to take account of. Trends in the market Our market involves our very, very quick consumers, who change their taste and their aspirations quickly too. But I’m sure that the dynamic cosmetics companies you have here in China will understand the best way to present their products to European consumers.
CHAILEEDO: what points should the Chinese companies focus on when they enter the German or UK market?
John Chave: It’s difficult for me to comment exactly on consumer sentiment, but of course, the cosmetics industry is a competitive industry with lots of consumer choices. I think that China, with its long traditions in cosmetics and beauty, probably bring something slightly different for European consumers, perhaps. Different use of ingredients or perhaps a different presentation of products. And I think that this will help differentiate Chinese products from others. This is European will. We’re always interested in trying new things and in novelty and exploring new possibilities.
CHAILEEDO: I think you’ve heard, is the Symrise. And do you want to, do you want to share some experience about the case?
John Chave: The cosmetics industry in Europe is strongly supportive of the ban on the testing and marketing of cosmetics, which have been tested on animals. We feel that it’s important that organizations and institutions like the European Chemicals Agency move very quickly to accepting alternative methods to animal testing our industry has been at the forefront of developing alternative methods for many years, and we’ve just launched a new organization for that purpose, which is called ICCS.
So I think it’s a pity that its assessment of these ingredients, required animal testing. We would much prefer, of course, that eka look to alternative methods than requiring new animal tests for cosmetic ingredients.
CHAILEEDO: Do you think that the alternative methods for animal testing work are working for the court?
John Chave: I don’t think that the court was asked to consider in this particular case, the alternative methods. The crucial thing is that the individuals within the European Chemicals Agency who make the decision to require animal testing, which is what happened in the Symrise case, the European chemicals agency insisted that Symrise undertake animal tests across a range of endpoints in connection with the registration of the substances involved is really important. those individuals understand the reality and the potential of alternatives to address the challenges that they raised.
We all want to move very, very quickly to a future where no animal testing takes place at all and that requires a degree of partnership between industry and other stakeholders and policymakers and individuals within European and other global institutions to understand the potential of alternative methods. This is something that the ICCS organization and I would urge you to look at. Policymakers and those who need to make the decisions in the world of chemical management understand the methods.
CHAILEEDO: The market size of the cosmetic industry in China reached 485.81 billion Yuan in 2022 year after year. Growth of 6.7% like domestic Chinese brands is also emerging. What insights do you have on the Chinese cosmetic market?
John Chave: Firstly, I’m delighted that the industry is growing in China. You have an innovative and dynamic industry. I just saw an example of my visit to China this time. Our industry is a trading industry.
The European Union as well, which is, I think, crucial. We’re interested in promoting trade and exchange between Chinese companies and European consumers and vice versa. The challenges that we have in China I think relate to some uncertainties around the regulation, so while we have a degree of certainty in the European Union.
For Chinese companies, it’s not quite the same for European companies entering the Chinese market. I think we would want to work towards clarifying some of these uncertainties and ultimately making sure there is a degree of alignment between Chinese regulation and European regulation, which makes trade easier. This will benefit Chinese companies and European companies. Most importantly, it will benefit Chinese consumers and European consumers.
CHAILEEDO: We’ve seen some trends that some European cosmetic brands entered China in the last years ago and they failed and stopped their Chinese business. And how do you think niche European cosmetics made progress in China?
John Chave: I think there is surely a demand for niche European cosmetics among Chinese consumers. The real difficulty is the uncertainty around the regulatory situation. Just to go back to my previous remarks, I think that many European companies, particularly the smaller ones, find it difficult to navigate through Chinese regulation.
To understand exactly how they can meet the regulations and comply, which is of course. Fundamentally important to entering the market. So the quicker we can bring clarity to this, the better. Again, I stress the point that if we move towards a situation where there’s a degree of compatibility between Chinese and European regulations, this will benefit everybody, companies, consumers, and the economy.
CHAILEEDO: Do you see any change in the post-pandemic era in the cosmetics industry?
John Chave: I don’t think there’s been any fundamental changes. I think one of the great things about cosmetics is that people love cosmetics products people use on their own. Our research suggests that people, on average, use around six, but anything up to thirteen different cosmetics products a day.
And while there were some changes because of wearing a mask, for example, during COVID-19, what we’ve realized, I think, is that there have been no fundamental changes in consumer sentiment. So I think the market has great potential going forward.
I think our industry in Europe and China will continue to innovate to meet consumer demand because people need cosmetics, people recognize that cosmetics bring something important to their lives that contributes to their quality of life, and these aspirations among consumers weren’t fundamentally changed by COVID and won’t be changed on thought.
