Win in efficacy, welcome the future. On September 22, The 5th CHAILEEDO Conference on China’s Cosmetic Trends hosted by CHAILEEDO was held in Hangzhou. Dr. Plant is a botanical skincare brand with 4,600 stores. We invited Mr. Xie Yong, Chairman of Beijing Dr. Plant Technology Company, to discuss the market trend of efficacy products in China with us. Q:We are honored to invite Mr. Xie Yong, Chairman of Beijing Dr. Plant Technology Company to share with us the trends in cosmetics. We understand that Dr. Plant has over 4,600 physical stores, what do you think will be the characteristics and trends of beauty stores in China? A:Now is the Internet era. Internet is the biggest influence in this era now. But beauty category does have a very different characteristic from other categories. It needs customer's trust. I firmly believe that simple brand offline brands is still difficult to survival because of the lack of endorsement. In fact, we have studied several categories that must have offline stores, such as pharmacies, milk powder. Because we dare not imagine buying something so important just with some simple clicks. Then, after several days, I can't even find the buying link. This is a very scary thing. Skincare is an extremely important category for women. Women want beauty, but they want more safety. So the endorsement of offline stores is very important. This future trend is that offline stores should be more distinctive. It will develop as a brand backing. That's why we as a brick-and-mortar store are still maintaining a growth (momentum) despite such a big impact from the Internet. Q:We also know that Dr. Plant opened its first overseas flagship store in Osaka, Japan in 2019 and is moving towards globalization. What do you think are the opportunities for Chinese brands to go global? A: The development of industry in all countries around the world follows a similar pattern, that is, with the development of economy, it will definitely bring cultural confidence. That cultural confidence is the development of the brand such as early British and Germany. Germany is also not confident in the beginning of creating brands. They all used products from British. Moreover, Germany was also synonymous with shoddy products in the pre-industrial Europe. However, with the development of its economy, it gradually produced a large number of very high quality brands, including now (as we know) car brands. Japan is the same. Japan was also the original blind worship of European and American brands. When that industrialization came. After World War II, Japan gradually regained self-confidence, only to engage in a large number of private brands. And China, I think currently facing a huge opportunity. With our economic development to a certain extent, it is clear that China's economy will definitely exceed that of the United States in the next 10 to 20 years. The most important sign of an economic power is that there must be many global brands. This is the case with the United States today. The number one brand in the United States is often the number one in the world. Because the United States is the world's largest economy. Then in the future is China's number one is the world's number one. This is obvious. The brands we know such as McDonald's, KFC, Tesla and Apple, etc. It's all premium American brands. Because he relies on a huge economic volume, then the brands can be generated. I believe that the era in China will also gradually come. Being that economy has several signs. First, when our economic development to a certain level, we will gradually have cultural confidence. This cultural confidence is not blindly begin to worship these so-called foreign brands. Another one is that our information is gradually symmetrical. Consumers will get more and more real information. For example, our skin is different from Westerners, our stratum corneum is very thin, our skin moisture content is higher than Westerners. This means that we need something more suitable for Chinese people themselves. Our whitening values are different from those of Westerners. Beauty values are different. They like brown skin. Chinese like white skin. Westerners like tanning, we are more focused on whitening. In this case, it is not appropriate for the Chinese to use Western brands to produce products for Westerners. A large number of consumers gradually have to get a new perception. And the new generation has a different understanding of foreign countries. In our early age, we were so different from the West that we thought everything was wonderful in the West at that time. Now it's not necessarily so. The new generation will gradually feel that Chinese things are advanced. Chinese brands are advanced. That's the opportunity. This opportunity will breed the rise of a lot of Chinese brands. Q: We would also like to ask you about the three major trends in the Chinese cosmetics market: natural, green and efficacy skincare. What are your thoughts on the market for botanical cosmetics in China A: First of all, the trend of plant-based cosmetics is unstoppable. As the public's awareness level gets higher and higher, people feel that chemical ingredients are inherently risky. Another thing is that natural cosmetics mean safety. This is also the case in restaurants and other industries. People pay more and more attention to the purity of raw materials. For example, people like to eat fresh fish, and even raw food, braised and stewed is not so popular, or not so desirable. Because these dishes add too much of a variety of other spices. That cosmetics is also the purity of raw materials is increasingly important. More and more will return to our traditional things.

Win in efficacy, welcome the future. On September 22, The 5th CHAILEEDO Conference on China’s Cosmetic Trends hosted by CHAILEEDO was held in Hangzhou. Ashland is a leading global specialty materials company. We invited Mr. Ling Feng, Director, Asia Pacific Business Development, Functional Ingredients, Personal Care, to discuss the market trend of efficacy products in China with us. Q: First of all, you also mentioned in your speech that emotional beauty is the future trend in cosmetics, what do you think are the characteristics of consumers in this trend? A: First of all, consumers must have a very strong resonance and their understanding of cosmetics is not limited to moisturizing or whitening or the visible effects. It prefers to use cosmetics, especially efficacy cosmetics, as emotionally related to this content. He wants to see cosmetics, especially efficacious cosmetics, as an emotionally relevant content. This is not a new trend. But we observe that as the science improves and there are more and more things support, it will be a real breaking point. In the past, the factors that many consumers actually bought or keep buying a cosmetics are attracted by its color, smell or touch. That factors of repurchase comes from his use. Cosmetics needs to be used for 28 days before the efficacy can be seen. But few people sum it up that my liking for the fragrance is related to my emotions. But if there are newer or better scientific means to discern, for example, there are some fragrance companies who use brain wave testers. When I see this skincare product, when I see its color and packaging appearance, my brain waves are in an excited, active or optimistic state. Then we will start from this improvement of emotions to make a relevant judgment. I believe that as technology gets deeper and deeper and consumers are able to communicate and be educated. We are all putting effort into improving (the degree of consumer education). Let the emotional beauty or efficacy real. And the combination should be visible then more and more consumers will like it. Q: What do you think will be the characteristics of cosmetic research and development under this trend? A: I think innovation requires perseverance, sensitivity and love for research, especially for original and start-up brands. As the originality of ingredients you mentioned, we know that Ashland has also developed some ingredients in recent years. Can you give us a look (how did Ashland develop the ingredients?) The first one is whether there is a clear mechanism. The second is how do I extract what I need in a green and sustainable way and get a stable output. The third part is, what means do I use to verify its effectiveness. Finally it completes a good scientific communication with consumers, or communication. These three are actually indispensable for us. Q: What advantages do you think artificial intelligence can offer in the development of cosmetic ingredients? A: Time saving and clearer understanding. AI in the design of efficacy ingredients is actually taking 90% of the experiments done by humans and using computer AI to simulate them through big data retrieval. It has done most of the predictive work. Human only need to spend the last 10% to do the efficacy verification or in vitro or human testing. So he can greatly save our time and the speed of R&D can be increased. Secondly, through artificial intelligence, we can often find a mutation or hidden characteristic in the process of upgrading the dimensionality from micro to macro. It is very difficult to construct a mutation or hidden characteristic only by human drawing or brain. But we can make full use of such an evolving science. From the combination of big data science, bioinformatics, artificial intelligence, it can help us explore new active ingredients or efficacy ingredients faster and better. Q: We also understand that Ashland's headquarters is now located in Shanghai and has set up two R&D centers. What are the opportunities and challenges that Ashland is facing with the trend of localization? A: As an international company, Ashland is still very optimistic about the Chinese market. Because we have smooth communication with Chinese consumers. In addition, Chinese consumers are the strongest and fastest in accepting new ideas, high-tech science communication, or receiving new things in the world. So we are very optimistic about the Chinese market. In addition to our R&D center, in addition to making Shanghai the center of the whole Asia Pacific region, we will also set up a new biofunctional ingredients factory in China except our existing factory in Nanjing. This move is probably the first of its kind among raw material manufacturers. From R&D to production, we will use Chinese herbal and plant resources to provide more and better and unique solutions to our customers in China and even in Asia Pacific.

Win in efficacy, welcome the future. On September 22, The 5th CHAILEEDO Conference on China’s Cosmetic Trends hosted by CHAILEEDO was held in Hangzhou. Forest Cabin is a skincare brand, the pioneer of camellia oil. We invited Sun Laichun, the founder of Forest Cabin, to discuss the market trend of efficacy products in China with us. Q: You have just mentioned long-termism.What kind of persistence do you think a brand needs for long-term development? A: Thanks to CHAILEEDO for the invitation.Actually I think if a brand wants to be long-term,there are at least 3 things that are the foundation.The first thing is long-term investment in scientific research.That is not immediately effective.It has to have a long period of time to do experiments to prove the results of the research.We need to determine whether it meets the requirements of consumer for skincare efficacy and safety indicators. The first is the long-term investment in scientific research.The second is the long-term investment in the brand.Because the brand should let consumers remember what you are doing.Like Forest Cabin, people all know we are focusing on camellia oil. It has anti-wrinkle effect.But people can't remember it if you only say it once.It needs long-time reputation and a long-term accumulation of brands.The third one I think is the training and building of talents. Organizations need long-term experience, training and fighting at the same time,which can train an effective team.To sum up, my opinion is scientific research, organization and brand.These 3 things are the 3 basic skills of all long-termist brands. Q:We learned that Forest Cabin aims at the mid-to-high-end market, what do you think will be the trend of the mid- to high-end market of Chinese cosmetics next year? A: The mid-to-high-end market has always been a strategy of Forest Cabin.We have a goal to become the first level of high-end cosmetic brands in China.Because from the global view,starting from Europe to the United States, and later Japan and South Korea are rising with economic GDP and cultural comprehensive national power.Especially in the consumer goods, especially cosmetics industry,are born several high-end skincare products. By analogy,China will inevitably give birth to several high-end cosmetics that represent Chinese culture and Chinese technology and design aesthetics in the future.I think the current decade is a golden decade for high-end cosmetics in China.In previous years, the Chinese market was completely monopolized by European, American, Japanese and Korean brands.But recently, Forest Cabin has explored the growth of local high-end cosmetics in China over the past 10 years.Especially the current generation of consumers is not simply using an imported product to differentiate from a Chinese product,but has started to look at the ingredients, the efficacy, the culture,and they even care about the brand has done the craft and charity. In fact, Chinese brands are in a continuous increase from this year onwards in the mass and high-end cosmetics market.So I think 2020 is a watershed.Chinese brands are bound to emerge in the next 10 years with at least three high-end cosmetic brands that represent Chinese culture and technology. Q: You just mentioned that the characteristics of Chinese consumers are actually changing now,what do you think are the main characteristics? A: I think this generation of consumers has changed so much.this first. People born in the 60s and 70s are crazy about foreign things.This generation of consumers is the complete opposite.They think every product is equal.No matter which country the products are from,as long as they meet his demand, he is willing to pay for it.Some consumers even only like Chinese products.This is the first change.The second change is that this generation of consumers are generally highly educated. In my age of university, only 3 out of 60 of my classmates can have higher education.Now the number increased to 59.This generation of young people's education is high.So their consumption will be more rational without blindly following the trends.So this generation of consumers prefer Chinese brands.This generation of consumers will be more about technology, about rational.Another detail I found is that current consumers is more picky.He may have bought less, but he would have bought better.So I am very optimistic about the future development of high-end cosmetics. Q: Forest Cabin has 400 directly-operated stores. What kind of trend do you think the development of Chinese direct chain stores will have? A: Forest Cabin insisted on doing direct sales for 19 years.In fact, we have never let go of the franchise. Because we need to consider whether this business model can help people make money in the end.It wasn't until last year that we tried to open a few franchise stores for testing.But now there are many areas we have not yet officially introduced.I think the future of direct franchising can go hand in hand.But there is an old saying in China. If we run a restaurant, you sell the food we make to your guests if you and your family don't eat it, it's immoral. If we do direct stores are not profitable, it is unethical if we let people join us.So when we make money as a direct-sale store. So when we make money doing direct stores, we are willing to share Forest Cabin's story and business opportunities to some of these entrepreneurs who are interested in engaging in cosmetic single brand stores. In fact, I think the direct store is the basis.It is the basis that a brand can consolidate as a chain store. In the future, direct-sale stores will definitely be chosen by some brands.Even Starbucks, which sells coffee, has chosen to operate directly.Apple, which sells cell phones, has chosen to operate directly. Huawei, which sells cars, is also operating directly.Now NIO car also operate directly.In fact, direct sales and cooperation are the standard in the future. Q: Then you mentioned in the speech that you will consider the franchise model, what kind of prediction and expectation do you have for it? A: I think in the future,franchising is the best way to fill the brand premiums and gaps in the region.According to our statistics, there are 2,800 county-level markets in China,Forest Cabin only has 400 stores now.If we want to achieve 2,000 stores. We still have room for 1,600 stores. We are waiting for more partners to develop together.We have a 30-square-meter store in Baoshan, Shanghai,It sales 300,000 yuan every month,which is more than the 200-square-meter store next to it that sells clothing. What will franchise stores rely on in the future? The future of the franchise depends on very high quality service, on very skilled skincare techniques and technology on the ability to accumulate members for a long time, and more importantly, on our ability to build 19 years of brand power research power and online-offline strategy. We just opened a store in Nantong.When the first day it opened, the performance was 680,000 yuan.That's because we already have online followers in Nantong. More than 10,000 followers know the store opening.Only one or two hundred people came to cheer on that day.In fact, I think we not only focus on online in the future,we must have offline physical stores with brand attributes, cultural symbols and brand experience. So we hope that more creative people who have a certain culture and loving beauty and are willing to engage in physical retail and combine online traffic with offline will work together to create the first high-end cosmetics brand in China. Q: Thank you, we know that you have said that you are optimistic about the development of the fragrance market and ready to launch high-end perfumes. What do you think the trend of the fragrance market will be this year? A: Fragrance has been developing in China for decades.After China's reform and opening up, all the fragrances in China were imported from France.But in fact, China has a long history of using incense.From watching TV and reading ancient books, we all know that the Chinese use incense, incense pouches,incense pouches hung on clothes at that time.and other kinds of scents.And in the palace, the agarwood and sandalwood of the big families. The use of incense has existed in China since ancient times.Incense it has a huge effect. It can regulate and heal some fatigue and stress. People are aware of the four treasures of the literati in Song Dynasty.but the literati also have four things called hanging paintings, making tea, lightening incense, and playing ancient instrument.Incense is an important standard for the literati.So the rise of China's fragrance market is inevitable.But there is a lack of high-quality local Chinese fragrance brands. Even high-end cosmetics have not come out. It is difficult to create high-end fragrance.Forest Cabin has more than 10 years of precipitation in perfumery. This year we will launch a high-end natural fragrance,which is already in the final stage of testing. There are many loyal followers who have already experienced the wonderful smell. We hope to let you experience it when it comes out sooner. Q: We're very excited about this.We finally come back to the question about botanical skincare.What do you think will be the characteristics of the plant skincare market? A: I think plant skincare is not only liked by Chinese people. Now the global chemical skincare and plant skincare have formed a trend.In the early days, Western cosmetic products were mainly focusing on chemical skincare.When it comes to China, the influence of the traditional Chinese medicine culture,the Chinese people have a natural preference for plant-based products. There are 3 trends in the future of plant-based skincare:The first is true.The so-called true, is that you are really 100% natural source.The concept claims has become a thing of the past.The second is effective.Ingredients are completely from natural.The real natural ingredients do not lose to any chemical synthetic or chemical skincare products efficacy.Whether you are anti-aging, anti-wrinkle, acne-removing or whitening and sunscreen, you have to be effective. Thirdly, I think there will be a trend of localization in China. The new national cosmetic regulations in China encourage the creation of Chinese local specialties of natural plants.There are actually numerous brands making an effort in this area.Forest Cabin has been working here for more than 10 years. We make China's alpine red camellia as a symbol and strength of our brand's research. The investment in scientific research is all on the red camellia in China. In fact, we hope that more companies in China can create real and effective cosmetics.In the same time, it is also in line with the authentic natural materials that Chinese local consumers like. There is a saying that each place has its own way of supporting its own inhabitants.Thanks.

On October 24, the Chinese E-commerce Double 11 Shopping Festival kicked off. As in 2021, the live streaming once again became one of the main battlefields of the Double 11 Shopping Festival. And Li Jiaqi is in a league of his own among live streaming on Taobao this year. According to the data of Taobao live streaming replay, on October 24, viewing volume of Li Jiaqi’s live streaming reached 465 million, refreshing the record of 157 million on the first day of this year's Chinese 618 Shopping Festival. This reflects that, as an absolute super-head anchor in the field of live streaming, Li Jiaqi still has a strong ability to attract traffic. As the opening show of the Tmall Double 11 Shopping Festival, the theme of the first day of Li Jiaqi pre-sale is "Super Beauty Festival", Chinese domestic and foreign beauty brands gathered. Specifically, the first day of pre-sale, Li Jiaqi live streaming has a total of 267 beauty and personal care products links, of which 208 links belong to imported brands, the remaining 59 links for Chinese domestic products, the proportion of Chinese domestic products is 27.88%, compared to this year's 618 pre-sale of 50 Chinese domestic beauty products links, 22.73% of the proportion has increased. According to CHAILEEDO statistics found that as of 24:00 p.m. on October 24, the estimated total amount of beauty and personal care products sold by Li Jiaqi on the first day of pre-sale is about 12.3 billion yuan(about $1.7 billion)(calculated by multiplying the lowest live price of products by the number of sold pieces shown in real time, where the number of pieces is calculated according to 100,000 pieces if the page shows sales volume of 100,000+ units). Compared with Li Jiaqi's first day sales of 11.54 billion yuan(about $1.6 billion) in 2021, Li Jiaqi's first day sales of beauty category this year have exceeded the total sales of last year's first day pre-sale. It is worth mentioning that this year, the number of products of Chinese domestic brands Winona and Proya are both 8 in Li Jiaqi’s live streaming, and the number of products of Chinese brand Quadha is also 6, second only to L'Oreal (15), Estee Lauder (13), Lancome (12) and OLAY (10), which also shows that the head Chinese domestic brands already have the possibility of competing at the same level as imported brands during the shopping festival. According to the latest official data from Tmall, on the first day of pre-sale of this year's Chinese Double 11 Shopping Festival, pre-sale turnover of four beauty brands reached over 1 billion yuan(about $137 million), 10 beauty brands over 500 million(about $68.5 million), 56 beauty brands over 100 million(about $13.7 million), and 52 single products over 100 million(about $13.7 million). That is to say, the top 4 brands on Tmall pre-list in beauty industry on Tmall is L'Oreal, Lancome, Estee Lauder and Winona. Their pre-sale turnover have exceeded 1 billion yuan(about $137 million). As far as the beauty and skincare segment is concerned, unlike 2021 when Winona was the only Chinese domestic brand in the Tmall Double 11 pre-sale beauty and skincare list TOP10, this year three brands - Winona, PROYA and Quadi - all entered the top 10. L'Oreal is still at the top of the list, while Winona rose to No. 2 from No. 5 in 2021, overtaking Lancôme and Estée Lauder. PROYA and Quadha ranked No. 5 and No. 7, respectively. In addition, the well-known Chinese domestic brands CHANDO and INOHERB also entered the Top 20, ranking No. 18 and No. 19, respectively. CHAILEEDO noticed that the five Chinese brands listed in the TOP20 of the Tmall Double 11 pre-sale beauty and skincare list also had good performance in Li Jiaqi's live streaming as well. If roughly calculated by multiplying the lowest live-stream price by the number of pre-sale pieces, at least 8 Chinese domestics brands with GMV over 100 million yuan(about $13.7 million) were created in Li Jiaqi's live streaming. Among them, Quadha completed a GMV of 613 million yuan(about $84 million), Winona completed a GMV of 524 million yuan(about $71.8 million), PROYA also achieved a GMV of 491 million yuan(about $67.3 million), GMV of CHANDO, OSM, Zhu Ben, and INOHERB have exceeded 100 million yuan(about $13.7 millioin) in Li Jiaqi live streaming.

In June this year, Dencare officially submitted a prospectus to be listed on the main board of the Shenzhen Stock Exchange, with CITIC Capital as the sponsor. Lesening’s parent company Chongqing Dencare Oral Care Products Co.(hereinafter referred to as Dencare) received feedback from the China Securities Regulatory Commission on its initial public offering of stock application documents, with a total of 31 items in two categories: regulatory issues and information disclosure issues. The prospectus shows that Dencare mainly engaged in the research and development, production and sales of oral care products. It currently has a well-known brand of oral care Dencare, Lesening, as well as high-end professional oral care brand Yi Yan, children's oral care brand Beilele, high-end baby oral care brand Monyum. Its main products cover toothpaste, toothbrushes, mouthwash, and other oral cleaning care products. The feedback on the normative issues, and 16 disclosure issues on Dencare. These include requiring Dencare to verify the previous equity transfer and mixed ownership transformation and verify whether there is any loss of state-owned assets. Dencare is required to disclose whether it has all the qualifications and licenses required to carry out business and disclosed possible pollution in production, whether subsidiaries and shareholders at all levels have received penalties, detailing the process of successive capital increases and share transfers, etc. Regarding the revenue data, the SFC requested Denkang Oral to explain the reasonableness of the decline in revenue of adult toothbrush products in 2020, but the increase in revenue of other products in the same year; to supplement the disclosure of the reasons for the decline in the unit price of children's toothbrush year by year; to explain whether the trend of changes in revenue and unit price of various products is in line with the current market situation and the specific composition of other revenue; to further explain the composition of costs and the difference in gross margin, etc. On the issue of information disclosure, the China Securities Regulatory Commission requested to explain whether the collection policy of payment before delivery to distributors is in line with the industry practice, analyze and disclose the reasons and reasonableness of the changes in the carrying amount of inventories during the reporting period and disclose the age and turnover rate of inventories. According to the prospectus, the core brand of Dencare Lesening has a market share of about 60% in the segment of anti-sensitive toothpaste. According to Nielsen's offline retail statistics in 2021, the market share of Lesening ranked fourth in the industry and second among Chinese local brands. In 2021, Dencare's total revenue was 1.143 billion yuan(about $157 million), up 10.97% year-on-year. Its net profit was 119 million yuan(about $16.3 million), up 24.79% year-on-year. From an industry perspective, in the oral care segment, according to Nielsen retail research data, China's toothpaste category market is relatively concentrated and the overall sales scale of the toothpaste market in 2021 is 33.980 billion yuan(about $4.7 billion), an increase of 0.86% compared to 2020. In the overall market, the top five manufacturers such as Yunnan Baiyao, DARLIE, P&G (Crest), Dencare (Lesening) and Colgate have a market share of 59.50%. In addition, the relevant companies are Weimeizi (Saky), Unilever (Zhonghuayagao), GSK (Shushida), Japan's Lion, South Korea's LG, NICE Group, Liby Group, Liangmianzhen and so on.

After experiencing the dismal beauty industry in July, August and September, the three live streamer Luo Yonghao, Yu Minhong from Oriental Selection, and the comeback in September Li Jiaqi may occupy Taobao live streaming. Recently, CHAILEEDO learned that former head live streamer Luo Yonghao on TikTok China confirmed that he would open Taobao live streaming during the Chinese Double 11 Shopping Festival, with the first live streaming scheduled for 8 p.m. on Oct. 24. In addition to Luo Yonghao, Yu Minhong from Oriental Selection will also appear in Taobao live on the evening of October 31. (Oriental Selection: an e-commerce live streaming under China's largest private tutoring firms New Oriental.) With the resumption of Li Jiaqi's broadcast on September 20 and the influx of Luo Yonghao and Yu Minhong, Taobao live streaming will reappear as “Three Kingdoms”. So, does this mean that the beauty of this year's Chinese Double 11 Shopping Festival can be "saved"? “Three Kingdoms” in live streaming on Taobao Luo Yonghao, the founder of Smartisan Technology, started live streaming on TikTok China in 2020. The total transaction of his debut live streaming on Taobao reached more than 110 million yuan(about $15.1 million). In the same year, Yu Minhong, the chairman and president of the New Oriental Education Technology Group, a leading China's largest private tutoring firms, said in an article on WeChat public account that he would launch a new platform for live streaming at 8 p.m. that night, "Oriental Selection". On September 3, "Oriental Selection" ranked first in the daily list of TikTok China e-commerce anchors with sales of 75,595,000 yuan(about $10.4 million). With the approach of this year's Chinese Double 11 Shopping Festival, the self-proclaimed "No. 4 in live steaming" Luo Yonghao and Yu Minhong announced that they will open Taobao live streaming, triggering widespread concern among industry professionals. "It is not unexpected. From an objective point of view, both sides have their own needs." A senior industry insider told CHAILEEDO that, on the one hand, for Taobao live streaming, new topics are needed to attract traffic. On the other hand, both Luo Yonghao and Yu Minhong that created the Oriental selection, its own business also needs more breakthroughs. In fact, it is undeniable for Li Jiaqi's influence on Taobao Live Streaming. Among them, beauty has always been Li Jiaqi's core category of goods. During Li Jiaqi's hiatus, the decline of the beauty products on Ali-related platforms was obvious. According to IFC statistics, beauty sales on three major e-commerce platforms in China Ali-related platforms, TikTok China and JD reached 54.16 billion yuan(about $7.5 billion), down 3.9% year-on-year. The growth rate has slowed down compared to the previous two quarters (2.4%, 1.7%). The off-season online beauty retail overall performance is flat. During the same period, beauty sales on these three platforms accounted for 64.6%, 23.5% and 11.9%, respectively, -10.1%, +11.7% and -1.6% year-on-year. According to a research report released by Guolian Securities in early October, the combined GMV of the cosmetics category (skincare + color cosmetics) on the Ali-related system platform in September 2022 was 19.556 billion yuan(about $2.7 billion), -7.8% year-on-year and +6.9% month-on-month, with GMV of skincare and color cosmetics categories at 14.38 billion yuan(about $2 billion) (-2.9% YoY) and 5.18 billion yuan($713 million) (-19.2% YoY), respectively. Guolian Securities said, "The super-head anchor Li Jiaqi returned in September, and the estimated sales of his Taobao live streaming would reach more than 100 million yuan(about $13.8 million) on the day of resumption, superimposed on the Tmall 99 Bargain Festival and 921 Goodies Festival, etc., the growth rate of the Ali-related beauty system rebounded." This reflects that the super head anchor has a vital role in stabilizing the Ali-related system traffic and driving sales. And Luo Yonghao and Yu Minhong, is undoubtedly the more ideal choice for Taobao live streaming at present. The Soochow Securities pointed out that Taobao Live Streaming needs super-head anchors, which will help the Taobao anchors form a gradient of competition between "super-head anchors - potential super-heads". For brands, there is more room for choice. At present, the account "Luo Yonghao" have reached 349,700 followers, and his e-commerce store" has 12,400 followers. In the evening of October 20, "Luo Yonghao" Taobao live streaming has officially opened, but the current did not find Luo Yonghao himself present. As of 7:24 pm on October 20, the number of people watching the live streaming has reached 1,136,700. The live background screen shows "October 24 Luo Yonghao Debut on Taobao". So, what is the performance of these two TikTok "top live streamer" in the field of beauty? CHAILEEDO found that, as of now, the number of followers of the Oriental Selection account for beauty covering the beauty category has reached 1.689 million, far more than the account of Luo Yonghao’s e-commerce store of 471,000. Also according to Feigua data, during July 21, 2022 to October 18, 2022, the transaction amount of Oriental Selection live streaming were between $138 million and $344 million, and the e-commerce store of Luo Yonghao were between $103 million and $138 million. For the beauty category, from September 19, 2022 to October 18, 2022, the account Oriental Selection for beauty were between $13.8 million and $34.4 million, and e-commerce store of Luo Yonghao for beauty were between $1.4 million and $3.4 million. "Just try" As we all know, the first three quarters of this year, the cosmetics industry into the winter has been an indisputable fact. Many beauty brands are looking forward to the Chinese Double 11 Shopping Festival. So Li Jiaqi live streaming also become the brand "must fight". In the past, the situation of the promotion, while international brands and Chinese domestic brands compete super live streamer, international brands tend to dominate. So, with the emergence of Luo Yonghao and Yu Minhong with the Oriental Selection, will beauty brands flock to their live streams this year? A person in charge of a beauty MCN agency based in Hangzhou revealed to CHAILEEDO that because of the time urgency, there are already many Chinese domestic and innovative brands signing up to prepare, "This year many international big brands have signed exclusivity agreements with Li Jiaqi, so there are more Chinese dometics brands intending to cooperate, and innovative brands are hoping to reveal." However, there are also a number of industry professionals who have given other views. Jiubian Beauty founder Nod believes that "Luo Yonghao’s debut on Taobao live streaming should still be dominated well-known brands and cost-effective supply chain goods, beauty category may not account for too much, he himself and his followers portrait and beauty fit is actually not high." However, for the beauty industry has experienced nearly a year of winter, Luo Yonghao, Yu Minhong successive influx of Taobao live, can still be counted as a dawn worth looking forward to. After all, compared to the TikTok China e-commerce, which take advantage of the quality content, the current Ali-related platform is still one of the best platform for selling goods. Therefore, many industry insiders also said, "Just try. But whether we can do good performance is hard to say".

CIIE has become the preferred venue for L'Oréal's annual debut of its latest beauty technology achievements. The 5th China International Import Expo will be held in Shanghai from November 5 to 10. As the "old friend" of the Expo for five years, L'Oreal Group has been the largest exhibitor of the daily chemical industry for five consecutive sessions and the chairman of the exhibition group for three consecutive sessions. Pietro BRAMBILLA, Chief Financial Officer of L'Oréal North Asia and China, representing the rotating chairmanship of the 5th CIIE said that, for five years now, the Expo has had a profound impact on society, warming the world and China like a spring breeze. This is why so many companies, like L'Oréal, have been willing to participate in the Expo many times. In the past five years, L'Oréal have witnessed countless exhibits turning into commodities, and from commodities into blockbuster products. Witnessed more and more exhibitors become investors, and from investors to partners. Witnessed the innovation technology become an innovation market, and from an innovation market into an innovation system. The CIIE has become the first choice for L'Oreal to show its latest cosmetics technology achievements every year. This year, L'Oreal will show up with three beauty "black technology" products, including Lancome Double Optical Tightness Instrument, YSL Headwear Device Scent-Sation and Colorsonic, a "handheld household hair dye". These products were first launched in Asia at the Expo, bringing Chinese consumers a multi-dimensional and upgraded beauty experience. According to L'Oréal Group's third-quarter financial results, sales for the period were 9,575 million euros ($9,404.5 million), up 9.1% year-on-year. Revenue was 27.94 billion euros ($27.442 billion), up 12% year-on-year. CHAILEEDO noted that L'Oréal Group achieved a good performance in the Chinese beauty market, where the premium cosmetics division had a record market share. In addition, in September this year, L'Oréal China's Shanghai Meizifang Investment Co., Ltd. announced its first venture capital investment in China with a minority investment in local high-end Chinese perfume and fragrance brand DOCUMENTS.

On October 24, the General Administration of Customs of the People’s Republic of China announced the national import and export customs data in September. From January to September this year, the total value of China's imports and exports was 31.11 trillion yuan(about $4.29 trillion), an increase of 9.9% over the same period last year. Among them, exports reached 17.67 trillion yuan(about $2.44 trillion), up 13.8% and imports reached 13.44 trillion yuan(about $1.85 trillion), an increase of 5.2%. In September, the total value of China's imports and exports was 3.8 trillion yuan(about $524 billion), up 8.3% from last year and 2.6% from the previous month. Among them, exports reached 2.19 trillion yuan(about $302 billion), up 10.7% year-on-year and 3.2% month-on-month. Imports reached 1.62 trillion yuan(about $223.4 billion), up 5.2% year-on-year and 1.8% month-on-month. Among them, beauty cosmetics and toiletries imported 37,160.1 tons in September, down 20.97% compared with the same period last year imports amounted to 13.82 billion yuan(about $1.91 billion), down 14.32% year-on-year. January-September cumulative imports was 318,639 tons, and the same period last year than the decline of 9.2% and imports amounted to 111.06 billion yuan(about $15.3 billion), a decline of 6% year-on-year. From the month-on-month trend, beauty cosmetics and toiletries imported tons fell 9.49%, but the amount of imports rose 7.8% month-on-month in September. From the perspective of the main importing countries, Japan, France and South Korea are the major cosmetic importing countries in China. From January to July in 2022, the import amount from these three countries reached 49.14 billion yuan(about $7 billion), accounting for 58% of the total cosmetics imports from January to July. It occupied half of the cosmetic import amount. After analyzing the total amount of cosmetics imported from Japan, France and South Korea in the past 12 years, CHAILEEDO found that France always held the position of the first importer of cosmetics in China during the 6-year from 2011 to 2016. However, in the following 5 years, its first ranking was occupied by Korea and Japan successively. And as you can see from the data below, this year (January-July), France returned to No.1 as the top cosmetic importer in China with an amount of 20.28 billion yuan(about $2.9 billion) after five years. The amount is nearly twice as much as South Korea. In terms of the amount of cosmetics imported by China from Japan, France and Korea, the position of Korea has changed several times over the past 12 years, but now the gap between Japan and France is getting bigger and bigger. CHAILEEDO also found that in the first half of this year, Korean companies haven’t ranked among the top 10 global cosmetics. Obviously, that is closely related to the economic, political and cultural factors between China and South Korea. It is worth mentioning that data from the General Administration of Customs of People’s Republic of China shows that from January to July this year, the amount of cosmetics imported from the United States reached 9.464 billion yuan(about $1.35 billion), narrowing the gap with South Korea to 1.036 billion yuan(about $148 million) from 6.143 billion yuan(about $877 million) in the same period last year. As a result, South Korea has maintained its ranks as one of the top three importers of cosmetics in China for at least 12 years, which is in jeopardy. Overall, the current Chinese cosmetics consumer demand is flat. Coupled with the impact of the epidemic and other factors overlapping, the imported beauty market is cold this year. The pressure of growth is inevitable. However, from the perspective of the market and policy environment, imported beauty into China will be a continuous and long-term trend.

On October 20, the Review Committee of the New York Stock Exchange's regulatory commission rejected Revlon's appeal and required Revlon to delist its Class A common stock, and has now suspended trading in the group's shares. By the end of the suspension, Revlon shares plunged 5.34% to $3.90, with a total current market capitalization of approximately $211.7 million. As early as Nov. 11, 2020, L'Oreal was on Weibo for "filing for bankruptcy", which triggered a rush in the Chinese domestic market at that time. However, two days after the news broke, the company was temporarily exempted from filing for bankruptcy because it had received the support of bondholders to eliminate a key debt. At that time, the company also said that it was trying to sell its brands to repay a senior loan. The company also formally filed for bankruptcy protection in the U.S. court in June this year. The bankruptcy reorganization of Revlon is still underway. Revlon has said in previous announcements that the bankruptcy reorganization does not mean the closure of the company and that it will not sell or dissolve any of its brands at this time. For this restructuring, Revlon said it can help it strategically restructure and repair its legacy capital structure to improve its long-term growth prospects in the face of ongoing global challenges (supply chain disruptions and rising inflation) and liquidity constraints on its lenders' debt. According to Revlon's previously announced 2022 interim results, in the first half of this year, its net sales were $922 million, down 2.14% year-over-year, and its net loss was $343 million, a 109.29% expansion in losses. The defeat of Revlon has long been evident in the Chinese market. It withdrew from the Chinese market in 2013 then it announced its return in 2016 under the name of Tmall's overseas flagship store. It opened a Tmall flagship store in 2019, and then fell into "bankruptcy" in 2020. To this day, Revlon has been losing money year after year, and even faces high debt. According to financial data, since its return to the Chinese market in 2016, Revlon has been losing money for six consecutive years. In recent years, Revlon's gearing has also gone way up. For example, from 2019 to 2021, Revlon's gearing ratio will be 135.03%, 173.66%, and 182.8%, respectively. Revlon President and CEO Debra Perelman also publicly stated last March that we will continue to execute strategic initiatives to drive growth for our iconic brands, Revlon and Elizabeth Arden, and to accelerate our e-commerce business in key markets such as China. Revlon has little room left to survive under the double squeeze of international beauty giants and upstart Internet brands. Coupled with external inflation and supply chain pressure, Revlon's walk into bankruptcy may be a foregone conclusion.

Hermes had a strong sales performance in all regions in the first three quarters of 2022. On October 20, Hermes Group announced financial data for the first three quarters of 2022. Hermes' consolidated revenue for the first three quarters was 8,611 million euros (approximately $8,387 million), up 24% year-on-year at constant exchange rates. Hermes sales in the third quarter were 3,136 million euros (approximately $3,054 million). For the first three quarters of 2022, Hermes performed strongly in all geographic regions. Asia continued its strong growth momentum, rising 21% year-on-year to 4,242 million euros ($4,131 million) compared to last year. Sales in Greater China remained strong despite the temporary closure of stores in Macau, Chengdu, and Dalian in July and August due to epidemic prevention and control measures. Axel Dumas, Global CEO of Hermes, said that the strong growth in the third quarter is a reflection of the global customer interest in the Group's products and the importance of the brand's values. Hermes moving forward with confidence and caution while continuing to develop an integrated model, rooted in France and committed to job creation. Specifically in the Fragrance & Beauty segment, the segment grew 18% year-on-year to 344 million euros ($335 million) in the first three quarters. The growth was mainly driven by the success of new products such as H24 with its new botanical fragrance. The beauty line also launched a limited edition of new products for Fall/Winter 2022, including three lipsticks and two nail polishes. In addition, Hermes recently added another unexpected product to its beauty lineup, Cabriole, a non-alcoholic fragrance specifically for children. the scent is known to be accompanied by notes of fresh honeysuckle scent accompanied by notes of sandalwood and apricot, and the design is designed to evoke the scent of a child’s cheek. The product is currently available for order at Hermes stores for $105 a bottle. In the report, the Hermes Group said that it is still difficult to assess the impact of public health, and economic and geopolitical implications for 2022. However, Hermes remains confident about the future development of the world market.

China's baby care market size is expected to approach 50 billion yuan in 2026, with the market size of the baby skincare category expected to reach 18 billion yuan. Following the mosquito repellent, maternal and child nursing (MCN) brand Runben Bio filed a prospectus with the Shanghai Stock Exchange (SSE) in May this year, recently, the Fujian Blue-Touch also filed its first IPO application with the U.S. Securities and Exchange Commission (SEC), intending to enter the U.S. stock market. Together with the listing of the parent company of Baby Elephant, CHICMAX Group will enter Hong Kong Stock Exchange. This year, China's baby care market is vigorous. Chinese maternal and child companies enter the U.S. stock market Public information shows that Blue-Touch was founded in 2014, the company is mainly engaged in the production, research and development, and sales of baby skin care products, washing and care, and cleaning products. Its product portfolio contains two major categories, namely baby skincare and washing, and household cleaning products. According to the disclosed prospectus, in the two fiscal years 2020 and 2021, the revenue of Blue-Touch was $3,096,900 and $6,655,500, respectively, with a growth rate of 114.9%. The net profit for the corresponding years was $49,000 and $775,500, respectively, with a growth rate of 1468.7%. For the fiscal year ending December 31, 2021, Blue-Touch’s baby skincare and washing products accounted for 49.47% of total revenues. Prior to the IPO application submitted by Blue-Touch, in May this year, another MCN brand, Runben Biotechnology filed a prospectus for a planned listing on the main board of the SSE, with the intention of raising 903 million yuan. In addition, the parent company of Baby Elephant, CHICMAX Group, also recently made an IPO application, once again sprinting for a Hong Kong stock listing. In contrast, the Baby Elephant has overall the largest scale of volume, more than Blue-Touch and Runben bio. According to the prospectus, Baby Elephant's retail sales in 2021 exceeded 1.8 billion yuan, ranking first among Chinese MCN brands, with a revenue of 871 million yuan that year. In the first half of 2022, among several major brands of CHICMAX Group, the Baby Elephant contributed 24.2% of revenue, second only to KANS's 47.8%. It is known that the core products of Runben Bio include mosquito repellent, baby care, and essential oils three categories, its baby care products sales revenue accounted for a year-on-year increase, mainly due to the increase in uncontrollable factors in the mosquito repellent business. The company has been transforming with the trend, constantly launching hot products for infants and children, and actively expanding online sales channels such as TikTok China, etc. During the reporting period, more than 70% of the revenue of Runben Bio came from online. China's baby market is on the rise Although the birth rate of newborns in China has been on a downward trend in recent years, the baby care market has been seen as a blue ocean by the industry due to the large base of this group. According to Euromonitor, the market size of China's baby care market is expected to approach 50 billion yuan in 2026, with the market size of the baby skincare category expected to reach 18 billion yuan, with a bright future. Compared with adult brands, Chinese baby brands started late and have a short history of development, and the share of Chinese brands in the mid to high-end market has been at a disadvantage in the past. However, with the continuous increase in investment in research and development, marketing, and other aspects of the brand in recent years, the share of local products is also increasing, especially in Tmall, TikTok China, and other e-commerce platforms. Chinese brands and international brands are standing up to each other as an equal. According to MMI, on the Tmall baby skincare brand sales list from July 2021 to June 2022, Dexter, Baby Elephant, Somda, and other national brands are among the top, with Dexter leading the way with sales of 374 million yuan, accounting for 7.8% of sales. The second-ranked U.S. brand Aveeno sales of 350 million yuan, accounting for 7.3%, while Baby Elephant and Somda sales of 315 million yuan and 235 million yuan, respectively. In addition to the established brands focused on the baby section, in the past two years, including the CHICMAX Group, Xunhuiji, and many other Chinese brand companies have also launched new baby product lines. Among them, the CHICMAX Group in 2015 after the successful creation of the Baby Elephant, in this year launched a new baby skincare brand "Newpage". According to the official website, Newpage was co-founded by pediatrician Cui Yutao and scientist Huang Hu, aiming to create a natural and pure, safe, and effective baby skincare brand. The reason why the baby care market is favored by the industry and can continue to attract brands to enter the market depends on the official policy support and the current shift in consumer awareness. On the one hand, the policy continues to be standardized. In January of this year, the National Medical Products Administration officially released the Children's Cosmetics Supervision and Administration Regulations, which cover many aspects including the definition of children's cosmetics, labeling requirements, and formulation principles, further strengthening the supervision and management of children's cosmetics, raising the barriers to product entry, and also further regulating the market, releasing the advantages of head companies. On the other hand, is the shift in consumer awareness and preference. Due to the sensitivity of the baby group, baby care products have always received a high degree of attention from the market, the current generation Z parents' consumer ability is increasing, the concept of scientific parenting is significantly enhanced, and higher requirements for product quality, efficacy, and service are put forward. With the refinement of consumer demand and the strengthening of the concept of product capability, it is expected to further promote the innovation and iteration of brand products and push forward the upgrading trend of China's baby consumption market. In addition, according to the data of iiMedia, Chinese consumers tend to obtain product information through social platforms such as Xiaohongshu, WeChat, and Weibo. 77% of the MCN flock said they are happy to share goodies on social platforms, and up to 81% of the flock prefer to buy baby products through online channels. The development of e-commerce platforms will undoubtedly inject more possibilities for the development of the baby care market.

From the reported data, P&G's overall growth remained low in the last quarter, with even no growth in the beauty and skincare division. Organic sales of skin and personal care products grew in the mid-single digits, but some of the growth was offset by the negative impact of declining SK-II sales. On the evening of October 19, P&G Group announced its results for the first quarter of the fiscal year 2023 (July-September 2022). According to the financial report, the Group's net sales in July-September were $20.6 billion, up slightly by 1% year-on-year, and organic sales increased by 7% excluding the impact of foreign exchange, acquisitions, and divestitures, with net profit, reaching $3.963 billion, down 4% year-on-year. weak response market as prices increased According to the report, organic sales growth was driven primarily by higher pricing and an aggressively performing product portfolio, although some of the growth was offset by a decline in sales volume. From the reported data, P&G's overall growth remained low in the last quarter, with no growth even in the Beauty & Skincare segment. Specifically, organic sales in the Beauty & Skincare segment increased by 4% to $3.961 billion in net sales, benefiting from price increases under an innovation-driven strategy. Organic sales of skin and personal care products grew in the mid-single digits, but the growth was partially offset by the negative impact of declining SK-II sales. In addition, organic sales of hair care products increased by mid-single digits driven by higher prices, but this was matched by contraction and sales volume declines in some markets. Organic sales in the grooming segment increased 5% year-over-year, with net sales of $1.625 billion. While organic sales grew for most products, slower growth in some appliance markets pulled down the overall growth rate. Organic sales in the Fabric and Home Care segment increased 8% year-over-year, with net sales of $7,082 million. Organic sales went up in all regions of the Home Care business, but the positive impact of price increases was partially offset by a decline in sales due to a weak response in some markets as prices increased. Organic sales in the Baby, Women's, and Home Care segments increased 6% year-over-year, with net sales of $4.934 billion. Specifically, the division still achieved full price increases across all categories, but the positive impact was partially offset by a lower product mix in Russia and a decline in sales in the home care segment markets. Lowered sales expectations P&G CEO Jon Moeller said that P&G still achieved more objective results in a very difficult cost and operating environment. Supported by these results, P&G will maintain an integrated strategy going forward to meet current challenges and continue to achieve the right strategy for balanced growth and value creation. It claimed in its earnings report that the outlook for P&G in fiscal 2023 includes unfavorable foreign exchange rates, commodity and cost increases, and higher freight costs, all of which have increased P&G's costs and profit and loss expenses by $3.9 billion. In terms of this situation, P&G lowered its guidance range for sales growth in fiscal 2023 by 3% to 1%, maintained its outlook for organic sales growth at 3% to 5% and maintained its expectations for diluted net earnings per share growth in the current fiscal year. It also added that it expects earnings per share results to be near the low end of its guidance range for the current fiscal year given the impact of foreign exchange.