Cosmetics & Personal Care Industry
Strong growth in Vietnam’s cosmetics and personal care sector
The trend of young people using cosmetics early is a well-documented phenomenon that has been observed across various cultures and countries. The use of cosmetics has become increasingly common among adolescents and young adults, with some studies showing that as many as 90% of young women in the United States use makeup regularly.
One of the primary reasons why young people use cosmetics early is social pressure. Adolescence is a time when young people are particularly concerned with their appearance and fitting in with their peers. Cosmetics have become a normative part of daily grooming routines, and not using them may make some young people feel out of place or less attractive. In addition, the media and advertising industries often promote unrealistic beauty standards, which can exacerbate feelings of inadequacy and social pressure to use cosmetics.
Self-expression is another reason why young people use cosmetics early. Cosmetics can be a means of experimentation with different looks and styles, and young people often use them to showcase their creativity and individuality. The use of cosmetics can also be a form of rebellion against established norms or expectations, particularly in cases where young people feel that they are being forced to conform to certain beauty standards.
Skin issues such as acne and blemishes are also a common reason why young people use cosmetics early. Acne and other skin problems can have a significant impact on young people’s self-confidence, and cosmetics can help conceal these imperfections and provide a sense of control over their appearance. However, it is important to note that the use of cosmetics may exacerbate skin problems if not used properly or in moderation.
Finally, education and awareness campaigns have contributed to the trend of young people using cosmetics early. Many beauty brands target younger demographics with products that are marketed as being safe and beneficial for the skin. Young people are also increasingly educated about the importance of proper skincare and the benefits of using cosmetics, leading to an increased uptake of these products.
While the use of cosmetics may have benefits for young people’s self-esteem and confidence, it is important to note that there are potential risks and downsides. Overuse or improper use of cosmetics can lead to skin irritation, allergic reactions, and other adverse effects. It is important for young people to use cosmetics in moderation, choose products that are appropriate for their skin type, and follow proper hygiene practices. Additionally, young people should prioritize their overall health and well-being and not rely solely on cosmetics for self-esteem and confidence.
Information about the cosmetics and personal care industry
According to a meta-study, the cosmetics and personal care industry will record a respectable revenue of USD 2.29 billion in 2021. The market is expected to grow by 6.2% annually (CAGR 2021-2025). Among them, skin care products are the most popular, with more than 60% of consumers using skin care products every day. The number of cosmetics stores across the country has grown by 40%. Most business is concentrated in two major economic centres, Hanoi and Ho Chi Minh City.
Ho Chi Minh City (HCMC), formerly known as Saigon, is the largest city in Vietnam and a bustling economic hub in Southeast Asia. The city is located in the southern part of Vietnam, along the Saigon River, and has a population of approximately 9 million people, making it the most populous city in the country.
History: The city has a rich history that dates back to the 17th century when it was originally a small fishing village. In the 19th century, the city grew in importance as a trading port, particularly after the French colonized Vietnam in 1859. The city became the capital of French Indochina in 1887 and remained so until the end of the colonial period in 1954. During the Vietnam War, the city was the site of many significant events, including the Tet Offensive in 1968. After the war, the city was renamed Ho Chi Minh City in honor of the revolutionary leader who played a key role in the country’s independence movement.
Culture: Ho Chi Minh City is a melting pot of different cultures and influences. The city has a rich culinary tradition, with a wide range of delicious street food available throughout the city. The city is also known for its vibrant nightlife, with a range of bars, clubs, and restaurants catering to both locals and tourists. In addition, the city is home to a number of museums and historical sites, such as the War Remnants Museum, the Reunification Palace, and the Notre Dame Cathedral.
Economy: Ho Chi Minh City is the economic center of Vietnam, accounting for around 20% of the country’s GDP. The city is home to many multinational corporations, particularly in the manufacturing and services sectors. The city has a well-developed infrastructure, with a modern airport, a deep-water port, and an extensive network of highways and expressways.
Tourism: Ho Chi Minh City is also a popular tourist destination, attracting millions of visitors each year. The city is known for its bustling markets, such as the Ben Thanh Market, which sells a wide range of goods, including local handicrafts, clothing, and food. Other popular attractions include the Cu Chi Tunnels, a network of underground tunnels used during the Vietnam War, and the Mekong Delta, a scenic area known for its lush greenery and floating markets.
Overall, Ho Chi Minh City is a vibrant and dynamic city that offers visitors a unique blend of history, culture, and modernity. Its rich history, diverse culture, and thriving economy make it one of the most fascinating destinations in Southeast Asia.
Cosmetics and personal care industry growth forecast
“VIRAC” in this context refers to the Virtual Research and Analytics Corporation (VIRAC), a research and analytics company based in the Philippines.
VIRAC specializes in providing data-driven solutions to clients across different industries, including government agencies, private companies, and non-profit organizations. Their services include data collection, analysis, and visualization, as well as software development and technology consulting.
The company was founded in 2010 and has since established itself as a leader in the field of data analytics and research in the Philippines. They employ a team of experienced analysts, developers, and consultants who use cutting-edge technologies and methodologies to provide innovative solutions to their clients.
Some of VIRAC’s notable projects include a nationwide survey on the impact of the COVID-19 pandemic on households in the Philippines, an analysis of the Philippine insurance industry, and a software platform for disaster risk reduction and management.
Overall, VIRAC is a reputable and innovative research and analytics company that provides valuable data-driven solutions to clients across different industries in the Philippines.
According to VIRAC, Vietnam’s cosmetics and personal care industry is expected to continue its growth momentum in 2023 for the following reasons:
- People’s income will soon return to normal levels
In the second quarter of 2022, the average income of employees recorded positive growth compared with the previous quarter and the same period last year. This is a sign that Vietnam’s economy is growing strongly. Life for workers is gradually returning to normal, as it was before the Covid-19 outbreak.
- Strong Growth of Social Media Platforms
With the number of users increasing year by year, social media is becoming an attractive market for brands to get closer to consumers. According to a comprehensive report, more than 70% of Vietnamese use social media. Vietnam ranks 12th in the world in terms of growth rate of social network users from 2021 to 2026.
This is why big brands and brands choose social media to develop their online presence on digital platforms. Additionally, the development of online brand channels helps reduce costs, increase customer interaction and build brand trust.
However, the average CPI in the second quarter of 2022 increased by 2.96% compared with the second quarter of 2021. In the first six months, CPI rose by an average of 2.44% year-on-year; core inflation rose by 1.25%. This is also one of the reasons that may lead to higher product prices and hamper the growth of the cosmetics and personal care industry.
CPI stands for Consumer Price Index, which is a commonly used measure of inflation in an economy. It is a statistical estimate that measures the average change over time in the prices of a basket of goods and services consumed by households.
The CPI is calculated by collecting price data for a specific set of goods and services, such as food, clothing, housing, transportation, and medical care, among others. The prices of these goods and services are then weighted based on their relative importance to the typical household’s spending, and the resulting index is calculated as a percentage change from a base period.
The CPI is used by policymakers, businesses, and consumers to monitor and forecast inflation trends, as well as to make decisions related to wages, benefits, and investment. Central banks often use the CPI as a key indicator in determining monetary policy, such as setting interest rates.
The CPI is calculated and published on a regular basis by various government agencies and statistical organizations around the world, including the US Bureau of Labor Statistics and Eurostat, among others. While the CPI is a widely used measure of inflation, it has also been subject to criticism and debate, particularly in terms of how it is calculated and what it includes or excludes in its basket of goods and services.
Reasons for strong growth in Vietnam’s cosmetics and personal care industry
The Impact of Social Media Developments on the Cosmetics and Personal Care Industry
Developments in the digital age are driving growth in many industries and sectors, including Vietnam’s cosmetics and personal care market. This has greatly influenced and changed the shopping behavior of consumers. Consumers have more opportunities to learn, choose products/services, shopping channels, etc., and they can conveniently use smart mobile devices to access the Internet. Thanks to this, consumers can more easily connect, find, access the latest beauty trends and find products. At the same time, the shopping process becomes simple and easy, and users only need one simple operation to purchase and pay.
Additionally, social media generates interest and stimulates interaction with consumers. Many customers are encouraged to spend by well-known beauty bloggers. They often share beauty tips and methods on big social networking platforms like Facebook, Tik Tok, Instagram…
Facebook, Instagram, and TikTok are all popular social media platforms, but they have distinct differences in terms of their features, audiences, and content.
- Facebook: Facebook is a social networking site that was founded in 2004. It allows users to create profiles, connect with friends, and share text, photos, and videos. Facebook has a broad user base and is popular among people of all ages. The platform offers a range of features, including groups, pages, and events, that allow users to connect with others who share similar interests. Facebook also offers advertising tools for businesses to target specific audiences.
- Instagram: Instagram is a photo and video sharing platform that was launched in 2010. It allows users to share photos and videos, follow other users, and interact with content through likes and comments. Instagram has a younger user base, with a significant number of users under the age of 30. It is known for its visually appealing content, with many users focusing on creating and sharing high-quality images and videos. Instagram also offers advertising tools for businesses, including sponsored posts and stories.
- TikTok: TikTok is a social media platform that allows users to create and share short-form videos, often set to music. It was launched in 2016 and has since become increasingly popular, particularly among younger audiences. TikTok’s content is often more lighthearted and entertaining than other social media platforms, with many users focused on creating viral videos or participating in challenges. The platform also offers advertising opportunities for businesses.
In summary, while Facebook, Instagram, and TikTok are all social media platforms, they differ in terms of their features, user demographics, and content. Facebook is a general social networking site that appeals to a broad range of users, while Instagram is focused on sharing visually appealing content and is popular among younger audiences. TikTok is a video-sharing platform that is known for its entertaining and viral content.
The average income is gradually increasing, and many Vietnamese are willing to spend money on personal care products
In 2019, Vietnam’s spending on cosmetics and health reached 6.6% of GDP. The index expects an average growth rate of 10.7% in 2022. Currently, living needs are improving and living standards are improving. Women view cosmetics as a necessity to help maintain and enhance their beauty. So it’s a potential market, especially for Vietnam.
According to the General Statistics Office (Ministry of Planning and Investment), Vietnam has seen a significant increase in its middle class, especially among the young. Since then, it has greatly influenced the development of the cosmetics and personal care industry
The General Statistics Office (GSO) is a government agency under the Ministry of Planning and Investment of Vietnam. It is responsible for collecting, compiling, analyzing, and disseminating statistical data and information related to the social and economic development of Vietnam.
The GSO was established in 1980 and has since played a crucial role in providing accurate and reliable statistical data to support policymaking, planning, and research. The agency works closely with other government ministries, international organizations, and research institutions to collect and analyze data on a wide range of topics, including population, health, education, labor, industry, trade, and agriculture.
The GSO’s primary functions include:
- Data collection: The GSO collects data from various sources, including surveys, censuses, administrative records, and other statistical methods. The agency uses rigorous sampling techniques and statistical methods to ensure that the data collected is representative and accurate.
- Data compilation and analysis: The GSO compiles and analyzes the data collected to produce statistical reports and indicators on various economic and social issues. The agency also conducts research and analysis to better understand the underlying trends and drivers of the data.
- Data dissemination: The GSO disseminates statistical data and information to the public, government agencies, and other stakeholders through various channels, including publications, online databases, and public presentations.
The GSO is committed to upholding the principles of transparency and accountability in its work, and it strives to provide high-quality statistical data and information to support evidence-based policymaking and planning in Vietnam.
Consumer Trends in Cosmetics and Personal Care Products
Natural Beauty Trends
Today, concerns about chemical cosmetics containing many harmful chemicals are rampant. Beauty with natural cosmetics is rapidly developing as a modern beauty trend of choice for many. Compounds are gradually being replaced by natural ingredients and pure herbs. Ingredients are taken from nature without going through chemical processing centers. Keep users safe. This is why women today love natural cosmetics so much.
This trend applies not only to beauty products, but also to the daily need for therapeutic nutraceuticals.
Therapeutic nutraceuticals are dietary supplements or functional foods that have medicinal properties and provide health benefits beyond basic nutrition. These products contain bioactive compounds such as vitamins, minerals, antioxidants, prebiotics, probiotics, polyunsaturated fatty acids, plant extracts, and other natural substances that have a positive impact on human health.
Therapeutic nutraceuticals are used to prevent or treat various health conditions such as cardiovascular disease, diabetes, cancer, arthritis, cognitive impairment, and digestive disorders. They are available in different forms such as capsules, tablets, powders, drinks, and functional foods.
The mechanism of action of therapeutic nutraceuticals varies depending on the specific product and the health condition being treated. For example, some nutraceuticals act as antioxidants and protect against oxidative stress and inflammation, which are underlying mechanisms of many chronic diseases. Others may modulate the immune system, improve gut microbiota, or regulate metabolic processes.
Some common examples of therapeutic nutraceuticals include:
- Omega-3 fatty acids: These are polyunsaturated fatty acids found in fish oil and other sources. They have anti-inflammatory properties and have been shown to reduce the risk of heart disease, stroke, and certain types of cancer.
- Probiotics: These are live microorganisms that improve gut health and immune function. They are commonly found in fermented foods such as yogurt, kefir, and sauerkraut.
- Curcumin: This is a bioactive compound found in turmeric. It has anti-inflammatory and antioxidant properties and has been shown to improve cognitive function, reduce the risk of heart disease, and alleviate symptoms of depression and anxiety.
- Green tea extract: This is a natural extract from green tea leaves that contains antioxidants and other bioactive compounds. It has been shown to improve brain function, reduce the risk of cancer, and promote weight loss.
- Vitamin D: This is a fat-soluble vitamin that is synthesized in the skin when exposed to sunlight. It is important for bone health, immune function, and reducing the risk of certain cancers and autoimmune diseases.
In conclusion, therapeutic nutraceuticals are dietary supplements or functional foods that have medicinal properties and provide health benefits beyond basic nutrition. They contain bioactive compounds that can prevent or treat various health conditions and are available in different forms. It is important to consult with a healthcare professional before taking any therapeutic nutraceuticals to ensure safety and effectiveness.
In addition to skin care services/products, consumers pay more attention to beauty trends in body, nails, hair, etc.
Besides skincare products/services, Vietnamese consumers are more interested in beauty trends for body, nails, hair, etc. This provides more opportunities for companies in this industry. The product lines in Vietnam’s beauty area are more diversified.
Trends in the use of high-end cosmetics
At present, Vietnamese cosmetics users have begun to pay attention to the quality factor of products. The two most important factors are origin and raw material. The price factor is no longer the focus today. Especially the effects of bad weather, polluted air… can have a bad effect on the skin. Regular cosmetic users also spent 10% more on cosmetics. This group is especially willing to spend more on color cosmetics. to obtain higher quality products.
Young people tend to use cosmetics early
The customer base who uses cosmetics is not only over 23 years old. The 16- to 22-year-old customer base is expanding. This is the fastest growing potential customer base today.
The fact that “young people tend to use cosmetics early” is well-supported by studies and surveys. There are several reasons why this trend exists:
- Social pressure: Young people often feel pressure to fit in and conform to social norms. Cosmetics have become a part of daily grooming routines, and not using them may make some young people feel out of place or less attractive.
- Self-expression: Cosmetics are also a means of self-expression for many young people. They can experiment with different looks and styles and use cosmetics to showcase their creativity and individuality.
- Influence of media: The media plays a significant role in shaping the way young people perceive beauty and grooming. Advertisements, magazines, and social media platforms often portray idealized images of beauty that young people feel compelled to emulate.
- Acne and other skin issues: Many young people experience skin problems such as acne, which can affect their self-confidence. Cosmetics can help conceal blemishes and other imperfections, giving young people a boost in self-esteem.
- Education: There is growing awareness among young people about the importance of skincare and the benefits of using cosmetics. Many beauty brands target younger demographics with products that are marketed as being safe and beneficial for the skin.
However, it is important to note that the use of cosmetics at a young age may also have potential risks and downsides. Overuse or improper use of cosmetics can lead to skin irritation, allergic reactions, and other adverse effects. It is important for young people to use cosmetics in moderation, choose products that are appropriate for their skin type, and follow proper hygiene practices. Additionally, young people should prioritize their overall health and well-being and not rely solely on cosmetics for self-esteem and confidence.
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