All Round Improvement for Beauty Sector

Within FMCG, beauty has always stood out as a powerhouse, with value growing four times faster and volume eight times faster than FMCG as a whole. The sector encompasses key segments including skincare, make-up, hair treatment, and hair colourant, each with its own unique characteristics. These collectively contribute to beauty's impressive performance, and further emphasise its distinct position in the market.

Over the past five years, Indonesia’s beauty industry has demonstrated consistent growth, with a slight dip in 2021 due to the pandemic. This resilience is largely due to its ability to continuously recruit new shoppers, which signals robust demand. Not only has the sector grown in value, but key metrics such as penetration, shopper spend, frequency, and price per unit have all shown sustained improvement.

The beauty industry has achieved significant growth over the past five years, primarily fuelled by Indonesia’s rapid infrastructure boom of 2019. Digital transformation has enabled brands to reach a broader audience, and enhanced product accessibility to promote category growth. Meanwhile, improved logistics capabilities are allowing faster and more efficient distribution of beauty products to retailers and consumers.

The pandemic further accelerated the growth trend. Self-care emerged as a significant priority, with consumers focusing on skincare and at-home treatments, reinforcing the beauty sector’s resilience. During this period of uncertainty, the development of online shopping and the success of local brands supported by the government managed to sustain growth with each element reinforcing the others.

This interconnected growth model not only cultivates a vibrant beauty industry, but also ensures its stability and adaptability in response to evolving consumer preferences and market dynamics.

The post-new normal era

As Indonesia moves into a new phase, consumers’ beauty needs are evolving in distinct ways. Skincare is seeing a rise in specialised products, with sunscreen leading value growth as much as 70%, followed by micellar water, and toner. In make-up, there’s a clear shift towards accentuating looks with radiant finishes, as products like cushion and blush on dominate with triple digit growth. Hair treatment trends are focused on revitalisation, with hair vitamins and tonics capturing significant market share and experiencing growth of over 40%. These shifts highlight a broader transformation in the beauty sector, reflecting increasingly sophisticated consumer preferences.

Let’s explore the five key emerging trends that will define the future of beauty in Indonesia, according to Kantar’s insights.

Embrace aspirations across social classes
Start early for the youth
Extend accessibility beyond key cities
Balance O+O Presence
Capitalise on festive season surges