March cosmetics retail sales rose 8.3% YoY, with premium beauty driving Q1 recovery

Overview

This report tracks the performance of China's beauty and personal care industry in March 2026 and Q1. According to the National Bureau of Statistics, cosmetics retail sales rose 8.3% YoY to Rmb46.3bn in March and 5.9% YoY in Q1, the highest annual growth since 2021. UBS attributes the growth to the continued recovery in premium beauty and, combined with Cosmetics Observer online GMV data and expert discussions, believes industry growth remains resilient heading into the 618 shopping festival.

Core views

The key views are: first, cosmetics retail growth clearly accelerated in March, with premium beauty as the main driver; second, online channel GMV rose 7% YoY in Q1, with Tmall turning from a decline in the same period last year to 5.7% growth, while Douyin still grew 14% but slowed from earlier levels; third, high-end international brands and some domestic premium brands significantly outperformed mass brands; fourth, local brands still have room to gain share in underpenetrated categories such as hair care, body care, and oral care.

Analysis framework

The report cross-validates industry trends using four types of evidence: macro retail data, third-party e-commerce GMV tracking, brand and category breakdowns, and expert interviews. The analysis focuses on March retail growth, Q1 online GMV, category and channel performance, and the relative performance of premium versus local brands.

Methodology notes

• Official retail data trackingNational Bureau of Statistics cosmetics retail sales

  Measures end-demand in the industry using YoY growth in monthly and quarterly cosmetics retail sales.

  March cosmetics retail sales rose 8.3% YoY and Q1 rose 5.9% YoY, which are used to assess the strength of the overall industry recovery.

• E-commerce channel trackingCosmetics Observer online GMV data

  Tracks total online transaction value across major e-commerce channels such as Taobao, Tmall, Douyin, and JD.

  The report breaks down online GMV by channel, category, and brand to identify changes in premium brands, platform traffic, and local brand share.

• Expert interviewsPremium beauty expert discussions

  Uses expert views to validate growth drivers in premium beauty and the outlook for 618.

  Experts believe Tmall's extended pre-sale period, normalized high-value consumption coupons, and targeted subsidies for 88 VIP members are important drivers of premium beauty growth.

Asset mapping & comparison

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

• China cosmetics industry

  Directly covered industry theme

  Strengths

  March and Q1 retail growth accelerated, online GMV remained positive, and the recovery in premium beauty provided support.

  Weaknesses

  Overall consumer confidence is still only gradually recovering, and mass brands are weaker than premium brands.

  Comparison

  March YoY growth in cosmetics retail sales was clearly higher than total retail sales of consumer goods.

  Risks

  A prolonged macroeconomic downturn or intensifying industry competition could दबress growth and margins.

• Premium and luxury beauty brands

  The main beneficiaries of the industry recovery

  Strengths

  International premium brands and some domestic premium brands posted strong Q1 GMV growth, and experts expect 5%-10% growth to hold through 618.

  Weaknesses

  Growth depends on consumer confidence, platform subsidies, and marketing budgets; post-return GMV should be monitored for quality.

  Comparison

  Performance was broadly stronger than mass brands.

  Risks

  If consumption coupons are reduced or consumer confidence recovers more slowly than expected, growth may decelerate.

• Local personal care and hair care brands

  Opportunity for share gains in niche segments

  Strengths

  Brands such as Spes, Off&Relax, and Kangwang posted rapid growth in hair care online GMV.

  Weaknesses

  Brand scale is relatively small, and capabilities in channel operations and product innovation vary significantly.

  Comparison

  International brands still dominate the hair care GMV top five, but local brands are gaining share.

  Risks

  Intensifying competition, declining marketing efficiency, or weaker-than-expected new product conversion.

• E-commerce platform channels

  An important carrier of sales growth and promotional policies

  Strengths

  Tmall returned to growth, Douyin maintained double-digit growth, and platform coupons and pre-sale mechanisms supported premium beauty sales.

  Weaknesses

  Douyin's growth slowed versus the same period last year, and some Taobao and JD data were relatively weak.

  Comparison

  Tmall improved materially, while Douyin still grew but with some marginal slowdown in momentum.

  Risks

  Rising platform traffic costs, changes in subsidy intensity, or longer promotion cycles could cause sales timing to fluctuate.

Key data

• March cosmetics retail salesRmb46.3bn, +8.3% YoYThe 1.7% YoY growth in total retail sales of consumer goods over the same period means cosmetics clearly outperformed overall retail.
• Q1 2026 cosmetics retail sales growth+5.9% YoYThis was the fastest YoY growth since 2021, implying a roughly 4% CAGR over 2021-2026.
• Q1 cosmetics online GMV across major e-commerce channels+7% YoYIncludes Taobao, Tmall, Douyin, and JD, with growth broadly consistent with the momentum seen in Q1 2025.
• Q1 category online GMV growthSkincare +1%, color cosmetics and fragrance +19%, hair care +17%Color cosmetics and fragrance, and hair care, grew noticeably faster than skincare.
• Channel performanceTmall +5.7%, Douyin +14%Tmall recovered from a 4% YoY decline in Q1 2025, while Douyin's growth slowed from 26% in Q1 2025.
• Premium brand performanceEstee Lauder, La Mer, and YSL about +30%; SkinCeuticals over +40%Overall, international premium and luxury brands outperformed mass brands.
• Domestic premium brand performanceMao Geping Q1 GMV rose more than +40% YoYThis shows that some domestic premium brands also benefited from the recovery in premium beauty.
• 618 premium beauty outlookTmall post-return GMV expected to grow +5%-10% YoYExperts expect premium beauty to maintain a steady growth trend during 618.
• Local hair care brand shareSpes +33%, Off&Relax +115%, Kangwang +128%Local hair care brands gained share across major online channels.

Impact & implications

The report's implications for China's cosmetics industry are moderately positive. In the short term, gradually improving consumer confidence, platform consumption coupons, and stronger brand marketing spending should help sustain sales momentum into and beyond 618. Structurally, premium beauty remains more resilient than mass brands, while local brands still have share-gain opportunities in niche personal care categories such as hair care, body care, and oral care. However, the industry is still constrained by the macro consumption environment and competitive intensity.

Risks

• A prolonged macroeconomic downturn could weigh on discretionary spending and premium beauty demand.
• Intensifying industry competition could push up marketing expenses, deepen discounts, and pressure margins.
• Consumer confidence may recover more slowly than expected, affecting 618 and subsequent sales momentum.
• Platform consumption coupons or brand marketing budgets below expectations could weaken the growth driver for premium beauty.

What to watch

• Whether premium beauty Tmall post-return GMV during the 618 shopping festival reaches the 5%-10% YoY growth range.
• Whether consumer confidence continues to improve and translates into discretionary beauty spending.
• The marketing budgets and new product launch intensity of global beauty groups in China.
• Whether the divergence in GMV growth across Tmall, Douyin, and JD widens further.
• Changes in share for local brands in niche categories such as hair care, body care, and oral care.