The Chinese beauty market is known to be fueled by a love of flagship products. Chinese beauty super-consumers are turning to social platform Xiaohongshu to share their meticulously curated beauty regimen – Crème de la Mer alongside emerging brands like Augustinus Bader and 111Skin. Even mature brands are using hero strategies – on Tmall, Shiseido’s top-selling SKU last month sold twice as much as their second most popular product.
There are many reasons for the enduring appeal of flagships, including some super catalysts of this trend that are unique to China.
First, China is the most competitive global beauty market, with 50% of total sales online, low barriers encouraging selling through cross-border e-commerce, and rapidly growing C-Beauty brands like Florasis and Colorkey. . This translates into rapidly rising costs – some platforms have seen CPA around key retail moments increase by more than 120% year over year.
Second, digital channels are less scalable than advertising via Meta or Google in the West. Word-of-mouth channels such as Livestream are hugely influential, and top talent like Austin Li selects less than 1% of the products shown to them. Their selection is motivated by success, measured in global sales, or proof of potential, measured in marketing budget.
There are potential pitfalls in this environment, but they can be managed. Maintaining price is a challenge, and over-distribution can devalue the product. Conversely, understocking sacrifices hard-won momentum and threatens profitability. Both can be mitigated with proactive monitoring and strictly enforced channel policy.
Quickly and accurately identifying your heroes is the first step. This should consider your own data and overall strategy, as well as market fit and competitive reach. Then comes the development of the marketing plan, of which the wide and deep sowing of the products is a central pillar.
As brands mature in China, they can diversify their heroes and leverage them to expand their range. The right channel strategy accelerates this; for example, leveraging trusted audiences from novelty-loving social commerce channels, whose GMV reached over $360 billion in 2020.
Emerging trends like single-brand diet kits may loosen the grip of heroes over time, but for now, picking a hero is driving China’s success.