2020 China Fragrance, Fragrance and Cosmetics Annual Conference

Sponsored by the China Fragrance, Fragrance and Cosmetics Industry Association, co-organized by Huzhou Moganshan High-tech Industrial Development Zone, and especially supported by Osman Holdings Group, the 2020 China Fragrance, Fragrance and Cosmetics Industry Annual Conference was successfully held in Oushiman Pearl Town, Deqing, Zhejiang from October 13th to 16th. Convened, the conference was launched around the theme of "carrying on the past and embracing the beautiful new era".

This conference invited nearly 500 government leaders, expert leaders, industry leaders and business representatives, including Chen Shaojun, chairman of the China Fragrance, Fragrance and Cosmetics Industry Association, Gao Yanmin, director of the Consumer Goods Industry Department of the Ministry of Industry and Information Technology, and Zhejiang Drug Administration First-level inspector Chen Zhihui, Deputy Director of Huzhou City Market Supervision and Administration Bureau Gu Jisheng, Deqing County Government Party Group Member and Deputy County Mayor Chen Yongming, Ou Shiman Holding Group Co., Ltd. Chairman Shen Zhirong, Group General Manager Shen Weixin, and Ou Shiman Biological Co., Ltd. Manager Shen Weiliang and others conducted exchanges and discussions around the hot issues and current situation of the cosmetics industry.

On October 14, Chen Shaojun, Chairman of the China Fragrance, Flavor and Cosmetics Industry Association, delivered the opening speech. He said: “2020 is an extraordinary year. Affected by the sudden new crown epidemic, China’s cosmetics industry Shanghai’s retail sales fell 11.6% year-on-year, but with the scientific and orderly progress of resumption of work and production, the industry’s vitality slowly recovered. From January to June, the online retail sales of cosmetics achieved a year-on-year increase of 20.5%. In addition, the new cosmetics supervision and management regulations It will be implemented soon, or it will bring about major changes in the industry. Therefore, under the current domestic and foreign environment, we hope to discuss how the industry can continue to develop in a healthy, orderly and high-quality manner through this conference."

At the same time, Gao Yanmin, Director of the Consumer Goods Industry Department of the Ministry of Industry and Information Technology, and Chen Yongming, a member of the Deqing County Government Party Leadership Group and Deputy County Mayor, also expressed their views and expectations on the industry. Swain, Executive Director of the International Flavour Industry Organization (IOFI) Bauer Schmid, JCIA Executive Officer Junji Yamamoto, and Korea Cosmetics Association (KCA) Vice President Lee Myung Kui expressed their blessings to the conference in the form of video because they were unable to attend the event.

01

Special round-table dialogue to discuss new industry trends

In response to the current regulatory policy trends in the cosmetics industry, the meeting specially invited Huo Gang, general manager of the R&D center of Osman Biotechnology Co., Ltd., Ma Jie, vice president of L'Oreal R&D center, Zhou Yingyan, chief operating officer of Sephora Greater China, and Mao Jianwen, global vice president of BASF As senior figures in various fields of the cosmetics industry, they conduct on-site face-to-face communication.

Ma Jie said that China's new cosmetics regulations are both opportunities and challenges for L'Oréal. As an internationally renowned group, L'Oréal has many brands and covers a wide range of regions. Although the company has a deep understanding of global regulations, how can the company adjust in time, how to keep close to the market and laws and regulations In a series of complex operation procedures, how to maintain quality and quantity, and speed up innovation is very critical. At the same time, Ma Jie is also full of confidence in the Chinese market. She hopes that there will be more leading independent innovations in the country, and not limited to bringing foreign innovations into the country.

Huo Gang believes that the new regulations are constantly adjusted and perfected under the development of enterprises and the market. As a company that has always been at the forefront of production and quality management, Ou Shiman has always invested in raw material management, product safety and efficacy. The new regulations have also given great support to the innovation of Chinese cosmetics, especially in the deregulation of raw materials, encouraging the development and use of new raw materials, so how can local companies make use of Chinese traditional advantages and unique resources to adapt quickly The market is changing and evolving, which is vital.

It can be said that the four guests all expressed unanimous views on product safety, efficacy and innovation, looking forward to future implementation and market reforms, and also aware of the upcoming challenges.

Therefore, in Mao Jianwen's view, whether it is the innovation of new raw materials or the three-year supervision period, all links in the cosmetics industry chain need to cooperate, participate together, and gain insights into consumers. When the data obtained is meaningful, innovation is needed. Have market significance.

As a global brand's operating store, Sephora has spared no effort to equate regulations and consumers closely, how to help the brand circulate in the market, and how to track consumer feedback. thing. At the same time, Zhou Yingyan also said that the cosmetics supervision and management regulations are regulations, but they also require enterprise self-discipline. It is not only the driving force of an enterprise, but also the vitality and lasting power.

In the speech in the afternoon, the meeting also learned from the recognition and exploration of the main responsibility of the enterprise under the new regulations, the new management ideas and models of cosmetic safety assessment, and the quality management of cosmetic raw materials. Through the experience and achievements of the companies to which the speakers belong , Shared and communicated with participants.

02

Focus on data and capture market trends

Chen Shaojun, chairman of the China Cosmetics Fragrance and Fragrance Industry Association, gave a brief introduction to the current status of the entire cosmetics industry. He said that as of 2016, there were 818 food flavors and flavors companies; as of September 2020, there were 5320 cosmetics manufacturers, of which Guangzhou There are more than 2500; and looking at the global annual per capita consumption of cosmetics, Japan ranks first, reaching more than 2,000 yuan, followed by the United States and South Korea, while China's overall consumption level is not high. Since 2018, sales of cosmetics have maintained a steady growth. Except for a cliff-like decline at the beginning of this year due to the epidemic, the market has begun to show signs of recovery after May. In addition, my country's import growth has been increasing in recent years.

Chen Shaojun believes that the real growth of Chinese cosmetics is after the reform and opening up. For decades, the cosmetics industry has maintained a 2-digit compound growth rate and has become the world's second largest consumer market, which fully demonstrates the vitality and potential of the Chinese cosmetics market. Therefore, for Chinese cosmetics companies, how to steadily develop under the implementation of new regulations and apply more research and development and cutting-edge science and technology to cosmetics is very important.

And what trends and opportunities will there be in the future cosmetics market?

1. Skin care is still the vanguard of beauty makeup. According to Tang Mengmeng, research manager of Euromonitor Information Consulting Co., Ltd., China’s skin care market reached 35.4 billion yuan in 2019, with an annual growth rate of 10%. It is expected that its compound annual growth rate will increase to 13% between 2019 and 2024. The skin care market may continue to lead the growth of the Asian market.

This point coincides with Chen Shaojun's concept, and Chen Shaojun also mentioned one point in his speech, which is the potential of the mask. From 2012 to 2017, the compound growth rate of facial mask products was the highest, reaching 15.8%; among them, 2017 increased by 10.2 year-on-year, accounting for 47% of the world. From 2017 to 2022, it is expected that facial mask products may still become the fastest growing Category.

2. E-commerce channels lead market development. Tang Mengmeng released a set of related data, which showed that the global beauty and personal care e-commerce market reached 56.8 billion U.S. dollars in 2019, with a compound growth rate of 16% from 2014 to 2019. Hu Shanshan, general manager of the emerging business department of Gefka Marketing Consulting (China) Co., Ltd., also said that e-commerce has become the largest sales channel for cosmetics. It started in 2010, and the proportion of online sales continues to grow. In the distribution of makeup sales channels, it has reached 38% by 2019, and department stores accounted for 36%. Especially during the epidemic, offline channels were blocked, and online channels accelerated to sink to lower-tier cities and expanded to all age groups. This trend will continue after the epidemic, and the proportion of online sales will increase. Therefore, Hu Shanshan said that planting grass online, trying makeup offline, and creating new ideas for beauty marketing will be a brand new and potential marketing method.

3. Five key points for the future development of perfume. Wang Zhuo, global partner of Beauty Streams think tank in the United States, shared his views on the future development of perfume category. He put forward 5 key words: new craftsman, smell medicine, mental health, fragrance technology and reshaping the retail industry.

The value of the new craftsman, the perfume, has become fundamental, and it must resonate with consumers' demands and expectations. Handicrafts and slow-paced products are even more lacking in today’s society. Pay attention to the comfort and emotion brought by the craftsmanship and craftsmanship of perfume products; and Odor medicine, on the other hand, perfume is no longer limited to imparting external scent to the body, but internally advocates the balance of body and mind and a new sense of experience. Biotechnology will become a new way of perfume innovation; mental health advocates the influence of fragrance on human emotions. The fragrance technology puts more emphasis on the combination of algorithms and artificial intelligence; the possible challenge of retail reengineering is how to improve the safe and exciting space, and the brand can be different from traditional perfume shops or It is particularly important to capture consumer attention in the environment of a department store.

03

The trend of digitalization, how should the industry embrace

With the development of science and technology, digitalization is an inevitable trend in society, and it has been integrated into all aspects of our daily lives, including the cosmetics industry. Whether it is AI or customization, it is closely related to digitization, and more and more companies continue to join the wave of digitization to move forward.

For example, the 360-degree AI foundation adapter launched by Maybelline, a subsidiary of L'Oreal, can provide consumers with online and convenient intelligent/personalized color selection services, as well as the large-scale customized production of Yi Sijia, which proves that digital affects not only the brand End, and penetrate into the manufacturing end.

The conference focused on the two aspects of digital marketing and how digital can help the development of the R&D supply chain. It is undeniable that as more and more brands are slowly turning to the front line, they can use new tools, such as live broadcast and fragmented media channels, combined with a better offline consumer experience, based on the product itself, precision Grasping the market needs and preferences, in the current consumer "research buying" behavior, better reach the product to consumers, you will get twice the result with half the effort.