Wellness tourism on track for major growth; health and beauty boost online sales for supermarkets; skincare – the next frontier for diversity; and Alibaba and Australia Post back new online program to help companies expand in China.
Wellness tourism on track for major growth
It's hard to avoid "New You" stories at the beginning of the year, but a lot of healthy living resolutions are for keeps reveals the latest data for the Global Wellness Institute (GWI). Total worldwide wellness expenditures now represent more than half of total global health expenditures and wellness tourism is growing at twice the rate of the general tourism industry at 6.5 per cent.
Representing about 5.3 per cent of the world's total economic output, the global wellness industry is split into five major sectors – Personal Care and Beauty (annual sales: US$1 trillion), Nutrition and Healthy Eating (annual sales: US$702 billion), Fitness/Mind/Body (annual sales: US$595 billion), Wellness Tourism (annual sales: US$639 billion), and the Spa Economy (annual sales: US$119 billion).
According to the GWI report, global wellness tourism is on track to grow at a rate of 7.5 per cent through 2022 to reach US$919 billion. "North America delivers the most wellness tourism revenues (US$242 billion annually) and Europe the most wellness trips – 292 million. But Asia-Pacific is the eye-opening growth leader with wellness trips growing at a whopping 33 per cent in the past two years. China and India rank first and second in growth of wellness trips".
Health and beauty boost online sales for supermarkets
Coles new quarterly health and beauty magazine underlines a fact that's often overlooked. According to Roy Morgan Research, supermarkets have a 12.1 per cent share of the Australia cosmetic market which is second only to pharmacies, including Priceline and Chemist Warehouse. In 2017, 600,000 Australian women made a cosmetic purchase at Coles over an average six month period, a squeak ahead of Woolies at 595,000.
The two giants of the nation's supermarket scene account for 85 per cent of online grocery sales, reveals Nielsen's Australia Grocery E-Commerce Report Q3 2018. There was a 39.7 per cent jump in online grocery sales over the quarter by contrast to a 2.7 per cent lift in bricks-and-mortar stores. In the preceding 12 months, 448,000 first time online grocery shoppers came on board to push overall growth to 21.6 per cent.
They are keen on beauty and health, too. Repeat online grocery shoppers allocated 8.3 per cent of their total spend on health and beauty products in the second half of the year. But close to 15 per cent of new online shoppers spent an average of $41.09 on health and beauty products.
Skincare – the next frontier for diversity
Much of the talk about diversity in beauty has focused almost exclusively on foundation and brands are still playing catch-up with Lancôme and Rihanna in stretching their shade ranges past 40 or more. A similar development in skincare has been slower to materialise. At the recent 9th edition of the Jean-Paul Marty Days in Paris, a series of talks and conferences organised by the French Society of Cosmetology, the world's top researchers and cosmetic chemists discussed the theme – “The Skin and its Appendages Around the World".
Caucasian skin remains the prime focus of many scientific studies, said keynote speaker, Paul Matts, Research Fellow at Procter & Gamble. "In 2050, Caucasian skin will represent only 15 per cent of skin categories, while high growth populations in Asia and Africa will be the majority. It's no longer possible to consider Caucasian skin as central in scientific studies".
The differences between ethnic groups are not aesthetic in skincare, as they are in makeup. P&G has conducted a leading study involving the major ethnic groups and come up with some major findings. People of Indian and Latino heritage, for example, have more wrinkles, but the wrinkles in Caucasian skin are deeper which makes them more visible. The International Centre for Pharmaceutical Development also presented its discovery that pollution has greater effects on Caucasian skins than on African skins.
Niche brands have been at the forefront of launching skincare for darker skins, notably in the US where African-American women spent US$465 million on skincare in 2017, reports Nielsen. Dr Barbara Sturm released her first skincare product for darker skin tones in 2016. Women with darker skin tones often suffer from hyper-pigmentation and increased acne scarring and also need sun protection. Other brands that have taken up the challenge include Epara, Bolden and UnSun. But the key leap forward, as Paul Matts points out, will arrive when the major players with the big R&D budgets increase their efforts in testing and research to create skincare that truly meets the needs of women with darker skin tones.
Alibaba and Australia Post back new online program to help companies expand in China
China's e-commerce market is already the largest in the world and is expected to reach US$1.6 trillion by next year. Australian beauty brands and retailers have enjoyed soaring sales through daigous (Chinese personal shoppers), online flagship stores and major shopping events such as Singles' Day.
But expanding into China is no easy ride for the unwary or unprepared. Alibaba Cloud, Australia Post and the Australia-China Council have partnered with Haymarket HQ, a Sydney-based co-working space, to offer the China Canvas Challenge, an online program to help Australian businesses expand into China. Valued at $4999, the inaugural 7 week program which begins on February 25 will be free. Go to www.chinacanvaschallenge.com to sign on or read more.
Alibaba Cloud is the largest cloud provider in China and is expert in guiding businesses in the Chinese market. Australia Post also has major runs on the board and recently partnered with 30 Australian businesses showcasing their products at the inaugural China International Import Expo held in Shanghai in November. With demand for Australian goods and services expected to expand at a healthy rate, 2019 is a great time to become China market ready, adds Duco van Breeman, General Manager, Haymarket HQ
Snippets from The Wires
- Probiotic skincare has been in the spotlight for the past 18 months, but the market is still very much in its infancy according to Vision Research Reports. In 2017, the global probiotic skincare market reached US$20 million and is expected to increase to US$81 million by 2025. The US and Europe have the highest market share of global sales – 40.68 per cent and 34 per cent, respectively. But the fastest growth over the next five years is expected to centre on China, Japan and South Korea.
- Sales of iPhones declined but Kogan.com.au has reported a revenue spike of 9.7 per cent for the second half of the year to December 31. The marketplace which bills itself as Australia's Premier Shopping Destination enjoyed its best Christmas trading period ever, with partner brand products and exclusives the standout areas of growth.
- There's a scene in the blockbuster movie, Aquaman, where the citizens of Atlantis dump all the waste in the oceans back on land as a gesture of retaliation. It's a sobering moment. P&G, Henkel, the maker of Schwarzkopf, and Clariant, one of the world's leading speciality chemical companies, are among 30 companies involved in the new Alliance to End Plastic Waste. The founding members have pledged US$1 billion over the next five years to eliminate the use of plastic, especially in the world's oceans.
