Cosmetics & Personal Care Industry
The cosmetics & personal care industry in Vietnam has a strong growth rate
Information about the Cosmetics & Personal Care industry:
The Cosmetics & Personal Care industry posted impressive revenue of US$2,290 million in 2021, according to the meta-research. The market is expected to grow 6.2% annually (CAGR 2021-2025). Among them, skin care products are the most popular, with more than 60% of consumers using them every day. The growth rate of the number of cosmetic stores nationwide increased by 40%. Most of the stores are concentrated in two major economic centers, Hanoi and Ho Chi Minh City.
Forecast of cosmetic and personal care industry growth rate:
According to VIRAC, Vietnam’s cosmetics & personal care industry is forecast to continue its growth momentum in 2022 with the following factors:
- People’s incomes will soon return to normal levels
The average income of employees in the second quarter of 2022 compared to the previous quarter and the same period last year recorded a positive growth. This is a sign that Vietnam’s economy is growing positively and strongly. The life of workers is gradually returning to the normal state like before the Covid-19 epidemic appeared.
- The strong growth of social media platforms
With an increasing number of users each year, social media is becoming an attractive market for brands to get closer to consumers. According to a general report, more than 70% of the Vietnamese population uses Social Media. Vietnam is the 12th country in the world in terms of the highest growth rate of social network users from 2021-2026.
This is the reason why big brands and brands choose social media to develop their online images on digital platforms. Moreover, the development of online brand channels helps to reduce costs, increase interaction with customers and build brand trust.
However, the average CPI in the second quarter of 2022 increased by 2.96% compared to the second quarter of 2021. On average, in the first 6 months, CPI increased by 2.44% over the same period last year; core inflation increased by 1.25%. This is also one of the reasons that can cause product prices to increase, hindering the growth of the Cosmetics & Personal Care industry.
The reason the cosmetics & personal care industry in Vietnam is growing strongly
The impact of social media developments on the Cosmetics & Personal Care industry
The development of the digital age helps promote the growth of many industries and fields, including the cosmetics & personal care market in Vietnam. This affects and changes the shopping behavior of consumers significantly. Consumers have more options in learning, choosing products/services, shopping channels, etc. They can easily use smart mobile devices to access the Internet. Thanks to that, consumers can connect, look up, access the latest beauty trends, find products more easily. At the same time, the shopping process becomes simple and easy, allowing users to buy and pay with just a simple operation.
In addition, social media generates interest and stimulates consumer interaction. Many customers are encouraged to consume behavior by famous Beauty Bloggers. They often share beauty secrets and methods… on major social networking platforms such as Facebook, Tik Tok, Instagram…
Average income is increasing gradually, many Vietnamese are willing to spend money to use personal care products
In 2019, Vietnam’s spending on cosmetics & healthcare reached 6.6% of GDP. This index is expected to achieve a compound growth rate of 10.7% in 2022. Currently, living needs are improving and living standards are increasing. Women see cosmetics as an essential thing, helping to care for and improve their beauty. Therefore, this is a potential market, especially for Vietnam.
According to the General Statistics Office (Ministry of Planning and Investment), the middle class in Vietnam has increased significantly, especially the young middle class. Since then, it has greatly influenced the development of the cosmetics & personal care industry
Consumer trends in cosmetics & personal care products
Natural beauty trends
Today, in front of concerns about rampant chemical cosmetics containing many harmful chemicals. Beauty from natural cosmetics is growing strongly as a modern beauty trend chosen by many people. Compounds are gradually being replaced by natural ingredients and pure herbs. The ingredients are extracted from nature without going through any chemical processing centers. Ensure user safety. This is the reason why today women are so fond of natural cosmetics.
This trend, not only for beauty products but also for the need for healing, daily nutritional food.
Along with skin care services/products, consumers are more interested in beauty trends for the body, nails, hair, etc.
Along with skin care products/services, Vietnamese consumers are even more interested in beauty trends for the body, nails, hair, etc. This opens up more opportunities for businesses operating in the industry. beauty field in Vietnam with more diverse product lines.
Trends of using high-end cosmetics
Currently, Vietnamese cosmetic users have begun to pay much attention to the quality factor of products. The two factors that are of most concern are the origin and the raw materials. The price factor is no longer a top concern today. Especially the influence of harsh weather, polluted air environment, … causes bad effects on the skin. Spending on cosmetics also increased by 10% for those who regularly use cosmetics. Especially for makeup products, this group of people are willing to spend more money. To be able to get higher quality products.
Trends of early use of cosmetics by young people
The group of customers who use cosmetics is not only at the age of 23 years and older as before. The set of customers between the ages of 16 and 22 is expanded. This is the fastest growing and potential customer group today.