BW Confidential - Issue #6 - May/June 2011 - (Page 52)

Market watch: China Analysis What’s next? Despite regulatory hurdles, China’s beauty market continues to grow at breakneck speed. BW Confidential analyzes brand and retail initiatives in the country, the risks and rewards of the business and where the market is headed by Oonagh Phillips G rowth in China continues to dazzle beauty companies. China’s beauty business was barely affected by the recession and last year despite a major change in rules governing product registration meaning that most foreign brands could not launch new items, the market still saw strong growth. Beauty and personalcare sales were up by 10.5% to $23.61bn, while the largest category, skincare, grew by 13.1%, according to market-research group Euromonitor. The change in product registration rules (which saw the Chinese State Food and Drug Administration take over from the Ministry of Health for product approval) created a good deal of confusion. As brands were unable to bring new products to market they were forced to re-invest in classic lines and animate the previous year’s launches. Meanwhile, Chinese consumers looking for newness picked up the latest products in Hong Kong, Taiwan or 52 Singapore. So while beauty sales continued to progress in 2010, some brands say growth could have been much higher had there been “ More products may be getting through now, but for how long? You never know what can happen with the registration in China Industry player no regulatory change. While most industry players say that the product registration situation is now much ” better, with approvals getting through, there is still anxiety over what the future holds on this issue. “More products may be getting through now, but for how long? You never know what can happen with the registration in China,” one industry player told BW Confidential. Another change to the registration process was due to come into effect in April this year (the rules are revised every year at this time). At press time, most companies were cloudy on what exactly this new change would mean and were awaiting information from the Chinese authorities. It is thought however, that this latest change would have a minor effect compared with last year’s modifications. Last year’s lack of new launches could make for an interesting 2011. There’s now a backlog of product ready to come to market, making for an avalanche of newness. This will no doubt ignite consumer interest and fuel purchases and growth, but it will also mean May-June 2011 - N°6 - BW Confidential

Table of Contents for the Digital Edition of BW Confidential - Issue #6 - May/June 2011

Cover
Comment
Contents
Update
- Brand & retail news recap
- Digital digest
- Companies on the move
Take note
- Market facts, figures & trends
Best of BW
- Highlights from our e-publication
Launches
- The latest in fragrance, skincare & make-up
Interview
- Puig ceo Marc Puig
Insight: Skincare
- Category overview
- Department store initiatives
- Perfumeries
- The latest trends
Wellness
- Discounting in spas
- Spa case studies
Retail
- New store concepts
Travel retail
- Market analysis: Asia & Middle East
- Chinese travelers
Radar
- Four up-and-coming beauty brands
Market watch: China
- Analysis: country overview
- Industry roundtable
- Prestige retailing
- E-commerce
Packaging
- Decoration techniques
Last word
- LPK Beauty vp group creative director Liz Grubow

BW Confidential - Issue #6 - May/June 2011