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A Closer Look at China’s Hair Care Market Boom

The demand for high-end shampoos, conditioners, leave-in hair oils or serums and hair masks is growing faster than its mid-price market counterpart.

With China’s rising middle class seeking a better quality of life, the Chinese hair care market is booming at a fast pace.

Gone are the days when the entire family washed their hair with laundry powders as daily essentials were rationed under Mao’s rule. Shampoos and hair conditioners were the symbols of Western civilization alongside McDonald’s and Coca-Cola when China later reopened its door to the world in the ’80s. TV commercials from brands like Procter & Gamble’s Head & Shoulders, Unilever’s Clear, and L’Oréal’s Kérastase inspired generations of Chinese consumers to find beauty and confidence with healthy hair as they improve living conditions for the family with hard work.

Now with social media and half the nation urbanized, a new generation of consumers is demanding dedicated products catering to their different needs and is willing to spend a bit more to achieve the desired result.

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“I spend as much money on my hair as I do on my face,” said the Beijing-based Joe Yue, who works at a venture capital firm. “I have fine hair and a sensitive scalp due to my long hours. So I need to use products that can give me volume without causing too much stress for the skin underneath.”

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She spends around $250 a month on hair treatments, including scalp massage with essential oil every two weeks, blow-dries at luxury hair salons, as well as all new and niche products to try at home.

Those who cater to this shift to premiumization in the space are yielding considerable profits. Procter & Gamble’s hair care business in China, for example, posted one of the strongest growth periods in the past decade, increasing by double digits, while other regions stayed at single-digit growth. 

The company attributed its success to Pantene’s premium innovation in conditioners, treatments and consumer communication, which “broke through the digital clutter, thanks to impactful online engagements like influencer livestreaming,” said the company. The price point for its high-end range, which includes the hair thickening and scalp soothing treatment and the overnight leave-in hair treatment, is three to four times higher than its classic offerings.

A report on the Chinese hair care market trends, released by Tmall and CBN Data, showed that the demand for high-end shampoos, which retail above 120 renminbi, or $18.20, from brands like Kérastase, L’Occitane, René Furterer, and Moroccanoil, grew much faster than mid-market players like Hair Recipe, Ryo, Spes, and Schwarzkopf.

In terms of functions, the demands for volume, oil control, anti-dandruff, and anti-itch products are strong, while silicone-free, ginger, fluffy, and coconut fragrance are new trending keywords.

The market for high-end conditioners is growing twice as fast when compared to mass-market brands, with international players including Kérastase, Moroccanoil, Grow Gorgeous, L’Oréal Professionnel, and René Furterer dominating the bestselling ranking, the report revealed. The leading demands for conditioners are color stabilization, dryness and frizz repair, as well as stimulating hair growth and non-steaming.

A report from market research firm Mintel revealed that similar to Yue, female consumers in China are moving away from traditional conditioners and are switching to leave-in hair oils, serums and hair masks, as many urban Chinese consumers consider hair care to be as important as skin care, and are willing to invest more in premium products.

Some 42 percent of Chinese female respondents purchased leave-in hair oils or serums in 2020, compared to 39 percent in 2019; while 34 percent of them bought a hair mask in 2020, an increase of 2 percent compared to 2019.

As a result, Mintel expects that China’s shampoo and hair care market will reach 60.5 billion renminbi, or $9.16 billion, by 2025.

Anne Yin, beauty and personal care analyst at Mintel said: “Growth in China’s hair care market is driven by the conditioner and treatment segment and is attributed to female consumers adopting a greater variety of hair care products, as well as both male and female consumers adopting scalp care products, despite the fact that it is a newer sector.

“Meanwhile, with consumers as keen to care for their hair as they are for their skin, brands have been active in launching new products and bringing skin care concepts into hair care products, all of which have supported a steady growth of the near-saturated shampoo segment,” she added.

Mintel also reported that Chinese consumers are keen to try new things, whether it’s constantly changing products or trusting new brands, as some 66 percent of the respondents said they don’t like to keep using the same hair care products.

Yin believed that “Chinese consumers’ trials of new products are driven mainly by benefits especially targeting their hair problems and hair conditions, similar to the function-led skin care market. Benefits-driven product design and communication are expected to go further to include more ingredient-level information and benefit mechanism education. Moreover, customization in caring benefits could also help products meet individuals’ demands better.”

JuE Wong, chief executive officer of the patented bond-building hair brand Olaplex, also sees premiumization, customization, and skinification, referring to the rise of sophisticated formulas used in hair care products that have typically been utilized in skin care, as trends that will drive the hair care business in the future.

She observed that consumers are willing to pay a premium price for technology, quality and results-driven products that work. And, similar to skin care, there’s an element of ritual that’s embraced with hair care, allowing for a returning consumer.

‘Women today are asking — if I can get so much for my skin care, why can’t I do the same [for hair], especially considering the scalp is a continuation of the skin. The other thing is, when you are willing to look at skinification of hair, you’re also willing to pay a little bit more,” she said during WWD’s Beauty CEO Summit last year.

The company more than doubled net sales to $598.4 million in 2021 and is predicting between $796 million and $826 million in net sales for 2022.

She listed China as a key market for the brand, as the nation represents over 10 percent of the $77 billion global prestige hair care market.

To better reach China’s young and affluent consumers, the brand last October formed a strategic partnership with JD.com to beef up its e-commerce offerings and appointed Daniel Zhou from the boy band INTO1 as the brand’s first brand ambassador.