July 23, 2024

Premium Cosmetics are Driven by Increasing Consumer Demand for High-Quality Personal Care Products

Premium cosmetics include products such as premium skincare, premium makeup, premium fragrances, and premium hair care. These products are characterized by their high-quality ingredients, innovative formulas, luxurious textures and aesthetics, superior efficacy, and prestige branding. Premium cosmetics deliver anti-aging benefits, improve skin health, provide long-lasting coverage, and enhance one’s appearance. The growing consumer desire for natural, results-driven, luxury beauty products is fueling the demand for premium cosmetics.

The global Premium Cosmetics Market is estimated to be valued at US$ 123.39 Bn in 2023 and is expected to exhibit a CAGR of 6.1% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market key trends:
One of the key trends in the premium cosmetics market is the rising popularity of clean label and natural products. Today’s consumers are increasingly looking for products with simple, easily recognizable ingredients. Premium cosmetics brands are responding to this demand by introducing natural and organic lines made with ingredients such as botanical extracts, vitamins and nutrients. For example, Estée Lauder launched its Advanced Night Repair line with natural ingredients. Another key trend is customized premium products. Brands are leveraging artificial intelligence and big data to customize cosmetic products based on customers’ skin types, concerns and preferences. Customized offerings deliver a highly personalized experience to consumers in the premium segment.

Porter’s Analysis

Threat of new entrants: The premium cosmetics market requires high investments and R&D capabilities to develop premium quality products thus posing a moderate threat of new entrants.

Bargaining power of buyers: The buyers in the premium cosmetics industry have moderate to low bargaining power due to availability of substitutes and strong brand loyalty of consumers.

Bargaining power of suppliers: A few major ingredient suppliers exist for raw materials used in premium cosmetics giving them some bargaining power over manufacturers.

Threat of new substitutes: Premium cosmetics have strong brand identity that attracts customer loyalty, limiting threat of substitutes.

Competitive rivalry: The market is highly competitive with top brands continuously investing in innovation and brand building to gain market share.

Key Takeaways

The global premium cosmetics market is expected to witness high growth over the forecast period of 2023 to 2030. The market was valued at approximately US$ 123.39 Bn in 2023 and is projected to reach around US$ 205.39 Bn by 2030, expanding at a CAGR of 6.1%.

Regional analysis: Europe is currently the largest consumer of premium cosmetics, accounting for around 35% share of the global market in 2023. Asia Pacific is expected to be the fastest growing region owing to rising disposable incomes in countries such as China and India.

Key players: Key players operating in the premium cosmetics market are L’Oréal, Estée Lauder Companies, Procter & Gamble, Shiseido, Coty, Chanel, LVMH Moët Hennessy – Louis Vuitton, Kering, Unilever, Beiersdorf. L’Oréal and Estée Lauder Companies currently dominate the global market with their premium product lines and strong geographic presence across regions.