Mass beauty and personal care are expected to record a relatively swift recovery, with younger consumer groups driving an increase in value-based consumption in South Korea in the coming years.
The Euromonitor Digest said millenials and Gen Z particularly demand for products with social responsibility, sustainable practices, and innovative marketing.
“Rather than following established trends, many younger consumers see beauty and personal care products as an opportunity to express themselves, their beliefs, and values through their consumer behavior. Young people increasingly see consumption as a way of making their voice heard economically and socially, as many consumers prioritize individuality over price or functionality, looking beyond more traditional beauty standards,” said the monthly online publication of the Department of Trade and Industry-Export Marketing Bureau (DTI-EMB).
The report said that when making a purchase, as well as considering the benefits of the product itself, younger consumers in South Korea will increasingly consider the product’s social impact.
“This includes, for instance, whether the product is sustainably produced, or whether the company producing the product is considered ethical or socially responsible,” it said.
The environmental impact will be a particularly important theme in value-based consumption in the next five years, it said, citing that demand for vegan products is expected to increase in many mass beauty and personal care categories.
“Captivating these consumers through social responsibility, sustainable practices, and innovative marketing will be important to success over the forecast period as brands will need to work on establishing their brand values and making them visible through marketing and packaging as well as their actions and practices,” it added.
The report said pricing remains key to success in mass beauty and personal care as price wars break out in e-commerce.
“As prices continue to fall in mass beauty and personal care, it has reached the point where it is almost impossible to succeed in mass categories without offering competitive prices or promotions,” it said.
Over the forecast period, companies in South Korean mass beauty and personal care will also continue to experience difficulties in exporting their products to other major global markets due to the continued impact of the coronavirus disease 2019 (Covid-19), especially this year.
“Players will also continue to face fierce and mounting competition in the e-commerce channel due to the explosion of e-commerce offerings during the Covid-19 crisis,” it added.
Mass beauty and personal care were hit hard by the Covid-19 pandemic in 2020 as tourism plummeted and consumers used fewer products while wearing face masks.