618 beauty GMV tracking is stronger than expected, ROI may improve, and foreign brands continue to outperform

Overview

This report is Goldman Sachs' tracking of the midpoint performance of China's cosmetics 618 promotional campaign in 2026. As Douyin and Tmall launched their campaigns on May 15 and May 21 in 2026 respectively, later than May 13 in 2025, the report summarizes mid-campaign changes in brand GMV, rankings, discounts, KOL dependence, and self-operated livestream traffic across platforms such as Douyin and Tmall. The core conclusion is that industry GMV tracking is solid, platform subsidies and reduced KOL dependence may lead to better brand ROI, but differentiation across brands is evident. Foreign brands are outperforming overall, while among leading domestic names Proya, Mao Geping, and Giant Biogene stand out relatively well.

Core views

First, at the industry level, May GMV of the Top 100 cosmetics brands on Douyin grew by high thirty percent year over year, materially beating market expectations and accelerating from January-April. Second, on ROI, more visible consumer subsidies, government subsidies, and reduced brand reliance on KOLs are expected to improve brand investment efficiency, although brands are also increasing paid traffic to flagship store self-operated livestream rooms to offset lower KOL participation. Third, on the competitive landscape, Western premium and dermocosmetics brands performed strongly, with Skinceuticals and La Roche Posay being the clearest cross-platform winners; Japanese brands were mixed, with CPB and SK-II performing better while Shiseido lagged; among domestic brands, Proya led, Mao Geping accelerated meaningfully, and Giant Biogene performed better than feared.

Analysis framework

The report is mainly based on Goldman Sachs channel checks, Douyin brand GMV tracking, Tmall early-buy sales rankings, KOL sales mix, self-operated livestream traffic structure, and platform discount and subsidy information, combined with covered company ratings, target prices, and a 2027E P/E valuation framework for multi-company comparison.

Methodology notes

• Channel tracking618 mid-campaign GMV and ranking tracking

  Assess sales strength during the middle of the campaign through Douyin GMV, Tmall early-buy rankings, and brand completion rates.

  The report compares growth of the Top 20/50/100 brands, completion rates relative to the full 2025 618 agency-caliber level as of May 29, and changes in Tmall early-buy rankings to identify divergence among foreign brands, domestic brands, and Japanese brands.

• Operating efficiencyKOL dependence and self-operated livestream traffic structure

  Use the decline in KOL sales mix and changes in paid traffic to flagship self-operated livestream rooms to evaluate potential improvement in brand ROI.

  Channel tracking shows that KOL sales exposure on Douyin fell by 6.5 percentage points for domestic brands and by 11-19 percentage points for Western and Japanese brands; at the same time, brands increased paid traffic to flagship self-operated livestream rooms to offset lower KOL participation.

• Valuation methods2027E P/E target multiple method

  Set 12-month target prices by discounting target 2027E P/E multiples back to year-end 2026.

  Target prices for Giant Biogene, Proya, Mao Geping, Bloomage, Botanee, and Shanghai Jahwa are all primarily based on 2027E P/E, with adjustments for COE, sector benchmark multiples, A-H discount, or growth premium.

• Goldman Sachs frameworkGS Factor Profile

  Compare stock characteristics across four dimensions: Growth, Financial Returns, Multiple, and Integrated.

  Goldman Sachs Factor Profile uses analyst forecasts and normalized rankings to assess growth, financial returns, valuation multiples, and integrated percentiles, providing investment context for stocks relative to the market and sector peers.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• Proya Cosmetics (603605.SS)

  A leading domestic brand, with standout performance in 618 tracking.

  Strengths

  Douyin GMV was up 58% year over year as of May 29, and it maintained the No. 1 position in Tmall's early-buy ranking.

  Weaknesses

  Goldman Sachs rates it Neutral; the valuation methodology mentions slowing growth, operational uncertainty after recent management changes, and potential dilution from an H-share listing.

  Comparison

  It is leading among domestic brands and outperforming most local peers.

  Risks

  New product development for the core Proya brand, changes in competitive intensity, ramp-up of new brand sales, and changes in selling expenses could cause operating margin to come in above or below expectations.

• Mao Geping Cosmetics Co. (1318.HK)

  A domestic premium beauty brand whose growth accelerated significantly during 618.

  Strengths

  Douyin growth accelerated from 8% year over year during May 15-26 to over 200% starting May 27; Goldman Sachs rates it Buy with a target price of HK$106.

  Weaknesses

  It is sensitive to premium beauty penetration, hero SKU performance, and marketing investment in new categories.

  Comparison

  The report sees it as one of the key winners among domestic brands due to its accelerating growth.

  Risks

  Slower-than-expected penetration of premium beauty products in China, rising marketing costs for hero SKUs and new categories, and more intense competition with overseas premium brands.

• Giant Biogene Holding (2367.HK)

  A covered company related to dermocosmetics and medical aesthetics; the report believes its 618 performance was better than previously feared.

  Strengths

  Its Tmall ranking improved from No. 12 to No. 11; Goldman Sachs rates it Buy with a target price of HK$46.

  Weaknesses

  Earlier weak performance from top KOLs had raised concerns, and the valuation incorporates multiples for both cosmetics and medical device businesses.

  Comparison

  Among domestic brands it performed better than feared, though its completion rate still needs to be compared with foreign premium brands.

  Risks

  Slower-than-expected growth or intensified competition in the professional skin treatment market, failure to successfully develop products, and regulatory risk.

• Shanghai Jahwa United (600315.SS)

  A domestic multi-brand cosmetics company, with encouraging year-over-year growth on Douyin mentioned in the report.

  Strengths

  Goldman Sachs rates it Buy with a target price of Rmb25, and the valuation reflects improving sales and net profit into 2027E.

  Weaknesses

  Overseas operations still face demand contraction and competitive pressure, while offline stores and management transition carry uncertainty.

  Comparison

  As one of the covered domestic companies, its Douyin growth is positive, but the business recovery still needs validation.

  Risks

  Overseas business impairments, continued closure of Herborist offline stores, weaker-than-expected sales growth for Dr. Yu/VIVE, weaker-than-expected online execution, and impact from management transition.

• Botanee Biotech (300957.SZ)

  A covered dermocosmetics company rated Neutral.

  Strengths

  Its target price is Rmb42.2, with valuation based on 27x 2027E P/E, reflecting improving sales and net profit into 2027E.

  Weaknesses

  The report does not highlight it as having a relative leading advantage in the 618 brand performance section.

  Comparison

  Compared with Buy-rated companies, the investment view is more neutral.

  Risks

  Penetration in dermocosmetics, market share gains, contribution from non-skincare categories, contribution from new brand revenue, and A&P spending could all come in above or below expectations.

• Bloomage Biotechnology Corp. (688363.SS)

  A covered company related to cosmetics, medical devices, and raw materials, rated Sell.

  Strengths

  There is upside risk if the skincare business recovers faster, cosmetics demand is stronger, competition eases, or the selling expense ratio declines faster.

  Weaknesses

  Goldman Sachs rates it Sell, with a target price of Rmb30 below the current price of Rmb36.78 cited in the report; the valuation mentions slowing growth and applies a discount to sector benchmark multiples.

  Comparison

  It carries the most cautious investment view in the covered group.

  Risks

  The main risks skew to the upside: faster-than-expected recovery in skincare, stronger-than-expected cosmetics demand, lower-than-expected competition, and faster-than-expected decline in the selling expense ratio.

• Western premium and dermocosmetics brands

  They outperformed domestic brands across platforms during 618.

  Strengths

  As of May 29, Western brands had reached about 96% of the full 2025 618 agency-caliber level; Skinceuticals and La Roche Posay were seen as the clearest cross-platform winners.

  Weaknesses

  After reduced KOL dependence, they need more paid traffic support for flagship self-operated livestream rooms.

  Comparison

  Overall completion rates were higher than about 79% for Japanese brands and about 57% for domestic brands.

  Risks

  If subsidy and paid traffic costs rise, ROI improvement may fall short of expectations.

Key data

• May GMV of Douyin Top 100 cosmetics brandsup by high thirty percent year over yearAbove the high-teens market expectation from channel checks, and an acceleration from low-twenties growth in January-April 2026.
• Douyin brand completion ratesWestern brands about 96%, Japanese brands about 79%, domestic brands about 57%Calculated as of May 29 relative to the full 2025 618 agency-caliber level.
• Change in KOL sales exposureDomestic brands down 6.5 percentage points; Western and Japanese brands down 11-19 percentage pointsThe report believes lower KOL dependence combined with subsidy support may improve brand ROI.
• Consumer subsidyup to an additional 20% discountChannel checks show that platform and government subsidies are more visible.
• Proya Douyin performanceup 58% year over year as of May 29Meanwhile it maintained the No. 1 position in Tmall's early-buy ranking.
• Mao Geping Douyin performance8% year over year from May 15-26, and over 200% year over year starting May 27The report says its growth accelerated significantly.
• Giant Biogene Tmall rankingrose from No. 12 to No. 11The report believes GMV was better than feared after weaker early performance from top KOLs.
• CPB Douyin performanceup 55% year over year during the tracking periodAmong Japanese brands, CPB and SK-II were key winners; SK-II rose to No. 3 in Tmall ranking.
• Shiseido Douyin performancedown 47% year over yearThe report identifies Shiseido as a major laggard among Japanese brands.
• 618 contribution to online GMVaccounts for nearly 75% of 2Q online GMV and about 21% of full-year GMVBased on monthly GMV distribution on Tmall, Taobao, and JD from 2020-2025.

Impact & implications

For investment, strong mid-campaign 618 GMV and potentially improving ROI support selective optimism on China's cosmetics sector, but not a broad-based recovery. Platform subsidies, reduced KOL dependence, and stronger self-operated livestream capabilities favor companies with multi-channel operating capabilities, brand strength, and product iteration ability; foreign premium and dermocosmetics brands still retain competitive advantages. Among domestic names, Proya's leading ranking, Mao Geping's accelerating high growth, and Giant Biogene's better-than-expected sales performance are positive signals, but valuation, management changes, marketing expenses, product development, and competitive intensity still need to be assessed company by company.

Risks

• The sustainability of platform and government subsidies is uncertain; if subsidies weaken, improvements in GMV and ROI may be difficult to sustain.
• As brands reduce KOL dependence while increasing paid traffic to self-operated livestream rooms, part of the ROI improvement may be offset.
• Competition in China's cosmetics industry remains intense, especially in premium beauty, dermocosmetics, and emerging domestic brands.
• If new product development, hero SKU cultivation, and sales ramp-up of new brands fall short of expectations, sales growth and margins will be affected.
• If selling and marketing expenses are higher than expected, operating margins may be pressured.
• Professional skin treatment, medical devices, and related businesses face regulatory risk.
• Brand performance is highly differentiated, and midpoint 618 data may not fully represent the final outcome for the entire campaign period.

What to watch

• Changes in Douyin, Tmall, and JD GMV and rankings after the full 618 campaign ends.
• Whether growth rates for the Top 20, Top 50, and Top 100 brands continue to remain consistent.
• The final completion rates of Western, Japanese, and domestic brands relative to the full 2025 618 agency-caliber level.
• Whether Proya can maintain its No. 1 Tmall ranking and strong Douyin growth, and whether Mao Geping's high growth can continue.
• Giant Biogene's subsequent GMV recovery and changes in Tmall ranking after weak performance from top KOLs.
• The impact on ROI and margins from paid traffic investment in self-operated livestream rooms after the decline in KOL sales mix.
• Whether platform discounts, government subsidies, and consumer subsidy intensity continue or taper off.