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Overview of Vietnam’s cosmetic market

Overview of Vietnam’s cosmetic market

Saturday 13, 08 2022
Vietnamese consumers are increasingly paying attention to their appearance and health. This may result in the increasing demand for cosmetics and skin care products.

Market size

The turnover of Vietnam's cosmetics market is currently about VND 51,000 billion a year (approximately USD 2.3 billion) according to Mintel - a global market research company. In particular, skin care products are the most popular, with more than 60% of consumers using them on a daily basis.

Vietnam's cosmetics market

Similarly, research of Statista also shows that the growth rate of the number of cosmetics stores in Vietnam has increased by 40%, from 87% in 2021 to 124% this year. Most of the stores are located in two major economic hubs, Hanoi and Ho Chi Minh City.

According to Nielsen, the spending level of Vietnamese consumers on cosmetics is not much. In fact, Vietnamese women spend more money on makeup than on skin care with the cost ranging from VND 300,000 to VND 500,000. The recent trend is multi-step cleansing to solve skin care problems like acne, large pores and dark circles under the eyes.

As appearance becomes more important, consumers spend more on beauty products and also on skin care services (spa, dermatology clinic). According to Kantar Worldpanel's Insight handbook 2021 report, the largest segment of the cosmetics market in Vietnam is lipstick. The explosion of e-commerce platforms has been affecting the shopping habits of Vietnamese people. Specifically, personal care products has increased by 63% compared to 2018, skin care products by 55% and makeup products by 25%.

However, Vietnamese cosmetic businesses are now holding only 10% of the market share, and they are trying to take back this attractive market. Currently, Vietnamese cosmetic businesses can only stay in the low-end segment and export to some neighboring markets. Moreover, 90% of Vietnamese cosmetic businesses are distribution agents of foreign cosmetics manufacturers. Most foreign cosmetics dominate the commercial centers in Vietnam.

Market trends

Microneedling

As a relatively new beauty trend, microneedling has developed into a popular beauty treatment at spas and clinics. However, due to the impact of the COVID pandemic, this trend is being negatively affected due to the closure of beauty services. However, it is being studied to be used at home.

Microneedling

Skin care for all genders

It is not easy to change customers' views about gender in skin care or body care. However, nowadays, many brands have launched many products for men. The year 2021 came with an explosion of Gen Z and new, open perspectives on ethnicity and gender. It's time for Vietnam's cosmetics industry to readjust its marketing strategy to deliver gender-neutral messages to customers.

Skin care for all genders

AI technology and machine learning

AI is used in the cosmetic industry in different ways like using information to create personalized experiences for each customer. With the development of computer science and artificial intelligence, the trend of personalization in cosmetics will expand and become more effective.

Source: gmp, innovativehub

Compiled by VietnamCredit

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