As 2024’s Double 11 shopping festival concluded, China’s beauty industry demonstrated unexpected resilience. Sales reached ¥963 billion (about $136 billion at current exchange rates), representing 22.5% year-over-year growth according to Syntun, a local consulting group. However, beneath these strong topline numbers lies a complex landscape shaped by new regulatory standards, shifting consumer behaviors, and constantly evolving international trade relationships.

A Memorable Festival

The Double 11 festival’s unprecedented duration, extending beyond a month, offered unique insights into these transformative forces. Major e-commerce platforms grew, with Taobao-Tmall commanding 50.1% overall market GMV, Douyin (China’s version of TikTok) capturing 26.7%, and JD securing 11.7% as of November 11, the real story lies in the changing nature of competition and consumer behavior.

Perhaps most telling was the dramatic decline of private label brands, once the darlings of China’s digital beauty boom. The case of Joyruqo is particularly instructive. After an astounding 8,283.61% growth on Douyin last year, the brand virtually disappeared from this year’s rankings. This wasn’t an isolated incident; across platforms, private label brands that once dominated through aggressive pricing and marketing found themselves increasingly marginalized. Only DCExport managed to maintain its position in the Top 18, and even then with a notably modest 98.08% growth rate.

This shift signals something more profound: industry’s evolution from a growth-at-all-costs mentality to one demanding more balanced development strategies. The success of domestic brands like Proya and Comfy, which secured top positions across major platforms, coincided with strong performances from international players. While established luxury brands such as La Mer, Helena Rubinstein, SK-II and CPB achieved 50-500% growth in high-end segments, this dual success story reflects a maturing market where both international and domestic players are adapting their strategies—international brands becoming more adept at local marketing while domestic brands increasing their R&D investments, though the latter remains a longer-term undertaking.

A Regulatory Renaissance

The shifting competitive landscape reflects a deeper transformation driven by China’s most comprehensive overhaul of cosmetic safety assessments to date. The April 2024 regulations, covering 3,578 ingredients and requiring extensive toxicological data, accelerated the industry’s evolution from price-driven competition to quality-focused development.

The implications are far-reaching. Toxicological testing for a single ingredient now reportedly costs over ¥300,000 around ($41,234) and requires 2-6 months to complete. It creates a natural barrier against the rapid product launches that once characterized the market. In response, brands and manufacturers are increasingly prioritizing ingredients with complete toxicological data packages already in place.

This regulatory shift has elevated data completeness over traditional cost-effectiveness as the decisive factor in ingredient selection. The industry has witnessed leading ingredient suppliers, OEM/ODM manufacturers and brands invest in toxicological testing—either by establishing in-house compliance capabilities or by building and strengthening partnerships with well-known institutions. Meanwhile, others are scaling back operations, with certain importers and small-to-medium suppliers and overseas brands exiting the market under mounting cost pressures.

Notably, these regulatory pressures align with evolving consumer preferences. The “efficacy-first” trend was evident in this year’s Double 11 sales, where consumers prioritized products offering multiple benefits and advanced formulations. It suggests a maturing market where regulatory compliance and consumer demands converge. Domestic brands like Comfy of Juzi Biotechnology, which sold over 70 million collagen stick units on the first day of Double 11, exemplify how companies can leverage this alignment between scientific investment and market demands.

Trade Tensions 

Following the recent US Presidential election, China beauty industry executives are discussing and assessing how the results might impact trade relations. The latest local report of a case of Cosmos Group, a leading Chinese supplier of sunscreen UV filters, illustrates this heightened awareness. Cosmos recently secured long-term contracts with US-based Edgewell Personal Care signalling preemptive preparation for possible tariff increases. This development carries particular significance given UV filters’ strategic importance in modern skincare formulations and growing consumer demand for sun protection products.

The full impact of trade tensions remains difficult to predict, but the experiences from the first Trump Presidency provide crucial context for understanding current market dynamics and potential future scenarios. During that period, the beauty sector underwent substantial market realignments, with specialty chemicals, ranging from polyurethane and polycarbonate to essential fragrances and flavors, facing tariff pressures. The fragrance sector proved especially vulnerable, as China-US trade represented approximately 14% of China’s total fragrance trade volume. The US was China’s third-largest importer and largest exporter, according to 2018 Chinese customs data.

Today’s landscape suggests an even more complex challenge. The US remains the largest overseas market, accounting for 20.5% of total exports in 2023. But significant growth has emerged in Regional Comprehensive Economic Partnership markets. RCEP members include Australia, Brunei, Cambodia, China, Indonesia, Japan, South Korea, Laos, Malaysia, Myanmar, New Zealand, the Philippines, Singapore, Thailand and Vietnam. Trade with RCEP countries jumped from $980 million in 2021 to $1.76 billion in 2023, according to the official statistics. The industry’s response to upcoming US trade pressures has been evolving via market diversification into a comprehensive reimagining of trade relationships. The establishment of the “RCEP Cosmetics International Exchange and Cooperation Platform” in 2023 further facilitates such regional integration, from product development to standards alignment.

This diversification strategy supports Chinese beauty brands’ international expansion. The term “going overseas” (Chu Hai) has been buzzing in the industry for more than a year. Companies like Florasis, Perfect Diary and Into You have a strong presence in Southeast Asian markets by effectively combining cultural understanding with digital innovation.

The industry’s response to trade pressures has evolved beyond market diversification to include strategic supply chain restructuring. According to local media reports, Chinese manufacturers increasingly invest in regional manufacturing hubs and R&D facilities across ASEAN countries, indicating a more sophisticated approach to international market development.

A Rationalization Paradox

The evolving dynamics of China’s beauty market are illustrated by simultaneous market exits and strategic entries. According to local media reports, a wave of departures included established international players such as Kao’s Coffret D’Or and Aube, Shiseido’s Baum and IPSA, Kose’s eponymous brand, and LG Household & Health Care’s Xiu and Ohui skincare lines. Notable exits also included Paul & Joe Beauté, By Terry, Coty’s Marc Jacobs Beauty fragrance and Philosophy brands, L’Oréal’s Nyx, and LVMH’s Benefit Cosmetics. Domestic brands weren’t immune to this trend, with companies like Fomomy and Lafang Group’s VNK also retreating from the market.

These exits might suggest market contraction, but upon closer examination, reveal a more nuanced reality. Major international groups are simultaneously pursuing strategic expansion plans, albeit with different brands and positioning. Shiseido, for instance, launched Drunk Elephant in April, meanwhile L’Oréal recently initiated a brand revival strategy for Atelier Cologne. LVMH, despite Benefit’s exit, accelerated Fenty Beauty’s market penetration. These moves suggest less of a market retreat and more of a strategic reallocation of resources toward brands better aligned with China’s evolving consumer preferences and regulatory landscape.

The New Beauty Paradigm

Three interconnected trends are reshaping the beauty landscape in 2025. Consumer preferences are maturing with increased focus on efficacy. Regulatory compliance is becoming integral to product development. International market presence is diversifying, particularly in RCEP markets.

Success in this evolving environment increasingly depends on companies’ ability to simultaneously excel across multiple dimensions. They must maintain regulatory compliance yet drive innovation; ensure supply chain resilience but expand internationally and develop sophisticated digital strategies while building brand equity. This integrated approach, rather than excellence in any single area, is a key differentiator in China’s beauty market.

Ally Dai

Freelance Writer

allisondai@126.com
allydai73@gmail.com

Ally Dai is a freelance writer/independent consultant based in Shanghai. She has covered the beauty industry for more than 15 years. Previously a senior editor and industry researcher, she now works on content creation with publishing houses, event organizers and PR companies in the personal care and life science industries.