Once upon a time, P&G, Estée Lauder and other foreign basic brands have long been leading the Chinese mass skin care market, and in recent years, local brands are using good skin care effects and accurate product positioning to continuously improve market share and bring Chinese public skin care into the "functional skin care era".
Euromonitor statistics show that in the past year, the mainland functional skin care market capacity of about 25.060 billion yuan, 2016 to 2021 functional skin care market compound annual growth rate of about 32.5%, the growth rate is much higher than the overall growth rate of the cosmetics industry, the mainland functional skin care market is entering a golden period of development, is expected to continue to maintain rapid growth in the future.
Homegrown functional skincare products rolled up
In the local functional skin care market, Bloomage Bio, Bethany and Shanghai Jahwa are particularly representative:
★ Bloomage's business has expanded from raw materials to diversified business models including functional skin care products in recent years. In 2021, its functional skin care business will account for more than 67% of the total revenue, and the sales of Runbaiyan single brand will exceed 1 billion;
★ Bethany is the well-deserved first stock of functional skin care, and its brand Winona's market share has increased by 2 percentage points compared with 2020;
★ Shanghai Jahwa is a local century-old enterprise, and its Yuze is also highly respected by young consumers.
Shanghai Jahwa Yuze (left), Bloomage Biorun Baiyan (center), Bethanie Winona (right) product picture. Courtesy of respondents
so
Why say these three companies through the launch
Local functional skincare products accelerate industry competition?
Look at a few sets of key data
Comparison of key data of Bloomage Biotech, Bethanie and Shanghai Jahwa for fiscal 2021. Courtesy of respondents
According to the 2021 fiscal annual reports of the three companies, in 2021, Bloomage Bio, Bethany and Shanghai Jahwa had revenues of 4.947 billion yuan, 4.022 billion yuan and 7.646 billion yuan respectively, compared with the three companies in 2020, which increased by 16.74%, 52.57% and 8.73% respectively. However, in the skin care business, Bloomage Achieved Revenue of 3.32 billion Yuan, an increase of 146.57% year-on-year. It can be seen that the growth rate of Bloomage's functional skin care products is amazing, far higher than the industry level.
After reading the performance data, then pay attention to the key brands
Bloomage Bio, Bethany, Shanghai Jahwa functional skin care brand revenue. Courtesy of respondents
According to the financial report, Bloomage Bio's Runbaiyan achieved an annual revenue of more than 1 billion yuan for a single brand for the first time, and the ceiling for future growth was further opened, and the company's strategic success probability of creating 3-5 national brands increased significantly. From the perspective of growth rate, the four major brands have doubled their revenue, of which the revenue of BM Muscle Vitality brand has increased by 286% year-on-year. Seven of the four major brands have an annual sales revenue of over 100 million yuan, marking that the company has more and more mature products and a solid user base.
In contrast, Bethany's Winona is not far behind, accounting for more than 98% of the company's revenue, an increase of more than 50% year-on-year. Although Shanghai Jahwa did not disclose the specific revenue figures of its Yuze brand, the brand's growth of more than 20% still exceeded the industry market.
Industry insiders pointed out that functional skincare brands are becoming the most critical growth driver for local cosmetics companies.
A great time for the rise of functional skincare products
When did functional skincare products start to rise? In other words, what are the advantages of this type of skin care products being popular in the market?
On the Zhihu platform, "How to read the ingredient list in skin care products?" This question, which has 9351 followers, has been viewed 2.97 million times, and the earliest answer dates back 6 years.
Know the screenshot
For the choice of skin care products, consumers have become mature, smart and cautious, compared to the star demonstration of the after-use effect and shopping guide sales words, they are more willing to believe in the ingredients of the product itself, the efficacy of the formula.
On the one hand, there is a change in consumption habits, and on the other hand, there is a change brought about by stricter management.
The "Cosmetic Efficacy Claim Evaluation Specification" came into effect on May 1, 2021, marking the official entry of the mainland cosmetics industry into the era of efficacy evaluation. Subsequently, on January 1, 2022, the Regulations on the Supervision and Administration of Cosmetics (hereinafter referred to as the "New Regulations") of the cosmetics industry came into effect.
Article 22 stipulates that the claim of efficacy of cosmetics should have sufficient scientific basis. Cosmetics registrants and record-takers shall publish a summary of the literature, research data or product efficacy evaluation materials on which the efficacy claims are based on the special websites provided by the drug supervision and administration department under the State Council, and accept social supervision.
As soon as the new regulations came out, it meant that the efficacy claims of cosmetics must be true and effective, and the era of "good money expelling bad money" in the functional skin care products market began: a large number of products with false efficacy will be eliminated, and those companies and brands with research and development as the core advantage and with deep efficacy moats will usher in the best development environment.
Bloomage Biologics, Bethanie, and Shanghai Jahwa invested in R&D in fiscal 2021. Courtesy of respondents
According to the 2021 financial reports of Bloomage Bio, Bethany and Shanghai Jahwa, the investment of these three companies in research and development in the past year was 284 million yuan, 113 million yuan and 163 million yuan, accounting for 5.75%, 2.8% and 2.1% of the operating income respectively. It is reported that Bloomage Bio's investment in the research and development of functional skin care products far exceeds that of the other 2 companies.
And from the perspective of team composition, the above three companies also have a strong talent force.
According to the financial report, Bloomage's R&D team is led by chief scientist Guo Xueping, with a total of 571 people, and has built R&D centers in Jinan, Shanghai, Wuxi, Beijing, France and other places.
It is worth mentioning that Bloomage Bio Shanghai Skincare R&D Center has leading domestic inspection and testing, biology, efficacy evaluation and other technologies. The constant temperature and humidity laboratory in this R&D center is currently the largest single skin care laboratory in China, and 12 skin care-related laboratories in 38 R&D studios are divided into three categories: basic research, applied basic research and formula development, so as to achieve its own "full-link development". In 2021, the State Food and Drug Administration officially set up the quality control laboratory of cosmetic raw materials in Bloomage Biologics.
Bethany has two R&D centers in Kunming and Shanghai, Yunnan, with more than 200 comprehensive R&D personnel. The company's efficient application of raw materials yunnan characteristic plants is one of the dimensions of the high barriers of the casting brand, and the executives and R&D team represented by the company's chairman Guo Zhenyu have a deep medical background.
Shanghai Jahwa also has a R&D team of 212 people, relying on the whole process of project management and the whole chain R & D model, from the three dimensions of basic research, application innovation and product value shaping to achieve scientific and technological empowerment.
In general, based on the maturity of the mainland market, the strength of national supervision and the strength of local enterprises, functional skin care products have ushered in a golden growth opportunity.
Who can go further?
For China, the world's second largest cosmetics market, the rapidly expanding brand development model based on capital and marketing has been "falsified" to a certain extent, and only those with core R&D strength and strong R&D framework are worthy of being trusted by the market.
Comparing Bloomage Biology, Bethanie and Shanghai Jahwa, we can find:
Bethany's research and development target is "Yunnan Characteristic Plant". Last year, Bethany was jointly awarded the "Yunnan Characteristic Plant Extraction Laboratory" by the Yunnan Provincial Party Committee, the Provincial Government and the Science and Technology Department of Yunnan Province, led by Bethany, and the Yunnan Provincial Institute of Materia Medica, Yunnan University and Yunnan Agricultural University participated in the construction of the Yunnan Characteristic Plant Industry Research and Development Public Platform.
Bethany Group. Courtesy of respondents
It is understood that this platform will focus on the research and development of functional cosmetics, functional foods and drugs based on Yunnan characteristic plants. Through research and development to application and then to market transformation, it provides scientific and technological support for the innovation of Yunnan characteristic plant health industry. It is reported that in 2021, Bethany Research Institute successfully developed a variety of Bethanie exclusive actives, such as acid calyx extract, kidney tea extract, peony root bark extract, ceramide of the green thorn fruit, etc., and gradually realized industrial application.
Shanghai Jahwa. Courtesy of respondents
Shanghai Jahwa's R&D innovation covers raw materials, formulas, processes, packaging and other aspects, and is known for cosmetics technology innovation and formula innovation. For example, Yuze's double-cavity locking technology of "Zhen'an Runze Repair Essence"; the invention patent technology of the multi-layer microcapsulation package of the "Flower of Life" series of double sisters; the new product of Herborist "Classic Salicylic Acid Mask", which successfully upgraded the patented technology of mild salicylic acid wrapping and sustained release technology; Gaofu's "Ruizhi Multi-effect Youth Rejuvenation Cleansing Bubble" has a refined amino acid-glycoside liquid cleansing formula and so on.
In contrast, Bloomage's depth in research and development is particularly noteworthy.
It is understood that Bloomage Biology takes two major types of functional sugars and amino acids as the research and development direction, including hyaluronic acid, ikedoin, GABA aminobutyric acid, collagen, heparin, chondroitin sulfate and other bioactives. Based on the research on bioactive substances, the results will be empowered to multiple business segments - bioactive raw materials, medical terminals and functional skin care products, functional foods, and R&D investment has played a "1+1>2" effect.
What is more noteworthy is that Bloomage Biology has a new layout in synthetic biology.
Bloomage Biotech is located in Daxing, Beijing, "Synthetic Biotechnology International Innovation Industrial Base". Courtesy of respondents
It is understood that Bloomage Biotech will start to form a synthetic biology platform in 2021 and list it as one of the company's six major research and development platforms.
Synthetic biology is one of the disruptive technologies that have led to industrial change in global development. The data shows that in the first quarter of 2021, global investment in synthetic biology was $4.608 billion, which is 5 times that of the same period in 2020, and more than the 11 years from 2009 to 2019 combined, and the investment is expected to reach $36 billion in 2021. In addition, synthetic biology is one of the 20 projects that will disrupt human life in a recent 35-page Emerging Technology Trends Report published in the United States.
In the field of cosmetics, Bloomage Bio is undoubtedly a pioneer in synthetic biology.
According to the company's 2021 annual report, Bloomage biosynthetic biology platform has built and completed platform projects: functional glycosynthetic biotechnology platform, functional protein and amino acid synthesis technology platform, natural product synthesis technology platform, protein efficient expression and enzyme engineering transformation technology platform. At the same time, through the opening of "industry-university-research", Bloomage Biology and more than 20 well-known universities and research institutes in the field of synthetic biology technology have established in-depth strategic cooperation, including tianjin institute of industrial biotechnology of the Chinese Academy of Sciences, Shandong University, Jiangnan University, Beijing University of Chemical Technology, Ocean University of China, etc.
In December 2021, Bloomage Biologics' "Shandong Provincial Key Laboratory of Bioactive Synthetic Biology" was recognized by the Shandong Provincial Science and Technology Department, and the "Synthetic Biotechnology International Innovation Industrial Base" was settled in Beijing Daxing Biomedical Base and put into use, and Bloomage Biologics built the world's largest pilot platform in Tianjin, which will efficiently transform synthetic biological research results and form a closed loop of "production, education and research". In the research of cutting-edge technology synthetic biology technology, Bloomage Bio has an unparalleled advantage in the whole industry chain.
In terms of specific applications, Bloomage Adheres to the genes of bioactive materials, optimizes the production efficiency of existing raw materials through synthetic biology technology, thereby reducing the cost of raw materials, and develops new raw materials with market application prospects, such as collagen, NMN (β-nicotinamide single nucleotide), human milk oligosaccharides, etc., which will provide more bioactive materials that are beneficial to human life and benefit national health. Synthetic biology technology is revolutionizing the cosmetics industry under the leadership of Bloomage Biology.
I have to admit that such an industrial structure allows Bloomage To establish a deep research and development moat. When the domestic cosmetics market officially enters the "era of efficacy", the supervision is becoming stricter and the market competition is fierce, the research and development strength and product strength will become the watershed of the brand's future development. Who can go higher and farther, and it seems that day by day.
(Featured | Written by Chen Bingqian)
Source: Information Times
Guangzhou Daily New Flower City Editor: Chen Tingting