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Color Cosmetics: A Comeback Story

By: Briony Davies
Posted: November 8, 2007, from the November 2007 issue of GCI Magazine.

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Despite falling short of the global average growth rate in color cosmetics in the 2001–2006 period, Asia-Pacific looks set to be the most dynamic region to 2011, with Euromonitor International forecasting average annual growth of 5%. This can, in part, be attributed to economic recovery in Japan, the region’s largest market. Sales of $30 billion in Japan account for almost 50% of the region’s sales. Manufacturers are having particular success in targeting the most important Japanese consumer group for color cosmetics—working women in their 20s and 30s who demand convenience and portability. SK-II’s Air Touch Foundation, for example, proved immediately popular following its launch in August 2006. The product is sold in unique round packaging and uses a battery-operated cartridge system.

Most importantly, however, it is designed to fit the contours of women’s hands, compact enough to be carried in a handbag and elegant enough to be used in public.

China, in absolute terms, will contribute significantly to the region’s growth, with the market for color cosmetics set to rise by $0.6 billion by 2011. Although color cosmetics is moving from being perceived as a luxury to an everyday item in the minds of many Chinese women, this trend is confined to urban areas. The key to unlocking the future growth potential in this category in China will lie in increasing penetration in the rural areas. Direct sellers—including Avon and Oriflame, which have licenses in China—are well placed to capitalize on this potential.

Although the Indian market for color cosmetics, with sales of $4 billion in 2006, is only one-third the size of China, it is one to watch out for in the future. Renowned for its use of makeup, much of its population still rely on natural, homemade products. However this is set to change as consumers become more demanding, and with India witnessing the fastest value growth for color cosmetics in the world, more and more international players are expected to make their foray into the country. Existing brands are expected to increase their product offerings and presence nationwide.

All About the Eyes

Fashion trends always have a major influence on color cosmetics, impacting both seasonal color collections and the demand for certain products, particularly eye makeup and lip products. Globally, eye makeup was the fastest growing subcategory, with 5.1% growth in 2006 to reach sales of $9.4 billion. Rimmel London’s color collection epitomizes the trend for pale lips and heavy eyes, and it is a look that has been heavily reinforced by celebrity proponents.