The Zhitong Finance App learned that the pattern of online beauty sales is changing. Following Taotian and JD, Douyin has become a new field for beauty growth. Data from the Rubik's Cube shows that in 2023, Douyin Beauty's overall GMV exceeded 150 billion yuan, a year-on-year increase of more than 60%. Among them, the skincare market occupied the main market share, with a market share of 65%.
Also, according to Magic Mirror Insight data, in the first quarter of this year, the overall GMV of TOP99 beauty brands across the network reached 49.367 billion yuan, officially hitting 50 billion yuan. Among them, Han Shu, a subsidiary of Shangmei Co., Ltd. (02145), became the champion in domestic beauty sales on the three major online platforms with sales of 2,345 billion yuan. Perea followed with sales of 2,271 billion yuan.
Led by Han Shu, domestic beauty products have entered a stage of high growth
There are 51 domestic brands on the list this time, while only 48 foreign brands are on the list. In terms of sales, Han Sook and Perea sold 11.108 million units and 10.704 million units respectively, significantly ahead of international brands such as Estée Lauder and Lancôme, which ranked fourth and fifth. This also means that domestic beauty products are ushering in a new pattern of brand competition.
It is worth noting that Han Shu and Perea, which are established domestic brands, are also the only domestic beauty brands with sales exceeding 2.2 billion yuan in the above list. Since then, the sales of domestic brands have not exceeded 900 million yuan.
The reason behind Han Shu's rise to the top is closely linked to the forward-looking layout of Shanghai US shares. Starting in 2023, Shangmei Co., Ltd. has focused more on its business layout, and has resumed growth around business strategies such as “fighting Douyin, focusing on Han Shu, focusing on Han Shuhong, and focusing on Han Shuhong's gift box.”
Citing Cicada's mom data: In 2023, Han Shu, a subsidiary of Shangmei Co., Ltd., won the Douyin sales championship of the year with a single brand GMV of 3.34 billion yuan; since the beginning of 2024, in the first quarter alone, Han Shu Douyin's GMV was close to 2 billion yuan. Douyin's accumulated potential for the brand also spilled over to other channels. According to reports, in the first quarter of 2024, the GMV of Hanshu's Tmall flagship store increased 283% year on year, JD's own GMV increased 611% year on year, Vipshop's GMV increased 128% year on year, and Pinduoduo's GMV increased 289% year on year. The overall online channel showed a rapid development trend.
From the 2023 results announcement issued earlier by Hanshu's parent company Shangmei Co., Ltd., you can also get a glimpse of Han Shu's growth — financial reports show that during the reporting period, Han Shu's revenue reached 3.09 billion yuan, an increase of 143.8% over 2022.
Driven by R&D, Shangmei shares lead the high-quality development of the industry
The rapid rise of domestic cosmetics in recent years is inextricably linked to its continuous layout at the R&D level. Take Shangmei Co., Ltd., the parent company of Han Shu, as an example: As early as 2003, Shangmei Co., Ltd. began to lay out independent research and development, and invested in basic research in 2016, built an “open innovation ecosystem”, and accumulated four basic research results on cyclic hexapeptide-9, TIRACLE PRO, E-AGSE, and artemisia oil AN+.
According to public data, Shangmei shares maintain more than 3% investment in R&D all year round, leading the way among domestic brands all year round. Even when compared to big international brands, the US accounts for an unrivaled share of R&D expenses: it far exceeds the international beauty group Estée Lauder's R&D expenditure rate of about 2.16% in fiscal year 2023, and is even more likely to push the upper limit of an average R&D cost rate of 1.5%-3.5% for international brands.
The accumulation of research and development results also provides effective support for the improvement of product strength in the US. Cyclohexapeptide-9 will be used in an upgraded version of Han Shu's popular product, the Hongman Waist series; the new product “Han Shu Revitalizing Essence” with TIRACLE PRO has also been officially launched recently; the brand An Minyou, which has artemisia oil AN+ as the core ingredient, has also won a good reputation among consumers for its outstanding efficacy.
Minsheng Securities said that as a leader in multi-brand domestic cosmetics, Han Shu, the main brand of Shangmei Stock Company, has established a strong brand mentality on Douyin. The Hongmanwaist series continues to expand, and model replication is expected to bring flexibility to the brand's growth. Empowered by the company's continuously improving R&D capabilities and deepening omni-channel layout, the company's long-term growth potential can be expected.