A growing number of Chinese beauty brands are looking to woo overseas consumers in less competitive markets amid weakened domestic consumption.
These companies may have an easier time finding success in Southeast Asia, where Chinese brands often have an edge because of knowledge gained from operating in China’s highly competitive market, along with their access to flexible supply chains that allow them to produce cost-effective products, according to industry insiders.
As the internet economy slows in China, overseas e-commerce has provided new opportunities in booming markets such as Indonesia, Malaysia and the Philippines. Even amid slowing global economic growth, the internet economy has remained resilient in Southeast Asia, where it was expected to exceed U$100 billion gross merchandising value in 2020, according to a report that year by Google, investment firm Temasek Holdings and consultancy Bain & Company.
For China’s online cosmetics brands, there are other reasons for looking abroad beyond just escaping stagnant growth at home. Overseas markets have less competition, they say, and consumers in neighbouring countries like those in Southeast Asia appreciate similar consumer aesthetics. E-commerce rules in these markets may also be easier to incorporate into their platforms.