Vietnam’s cosmetics industry has witnessed remarkable growth in recent years, driven by a burgeoning middle class, increasing disposable incomes, and a growing awareness of personal care. The country’s young and fashion-conscious population has fueled demand for a wide range of beauty products, from skincare and makeup to haircare and fragrances.
The cosmetics market in Vietnam presents a unique opportunity for foreign firms due to the country’s rapid urbanisation and exposure to global beauty trends through social media and online platforms. The rising disposable income of Vietnamese consumers has led to increased spending on premium and luxury cosmetics, creating a niche market for high-end brands.
However, foreign companies need to carefully consider the specific preferences of Vietnamese consumers, which often differ from those in Western markets. Localising products and marketing strategies is crucial for success. Additionally, understanding the regulatory landscape and building strong distribution channels are essential for navigating the Vietnamese cosmetics market.
Vietnam’s cosmetics market in numbers
Vietnam’s cosmetics market is experiencing robust growth, driven by increasing disposable incomes and a growing middle class. In 2024, the market is projected to generate a revenue of US$546.20 million, with an anticipated annual growth rate of 3.20 percent until 2028. While this figure pales in comparison to global giants like the United States, which is expected to generate US$20,130 million in the same year, Vietnam’s per capita spending of US$5.49 indicates growing consumer interest in personal care, according to data from Statista.
Notably, the demand for natural and organic cosmetics is surging, reflecting a broader shift towards sustainable and ethical consumption. This trend presents opportunities for brands that align with these values.
Furthemore, a sizable amount of cosmetics spending in Vietnam is on imported products. In the first seven months of 2024, approximately US$800 million worth of essential oils, perfumes, and cosmetics had been imported into Vietnam. This was an increase over the same period a year earlier of 14.8 percent.
Vietnam imports of essential oils, perfumes, and cosmetics, July 2024
| June | July | MoM | YTD | |
| Singapore | 35,609,512 | 35,111,613 | -1.40% | 235,029,859 |
| South Korea | 15,142,276 | 15,148,308 | 0.04% | 112,888,995 |
| Thailand | 13,449,053 | 11,578,566 | -13.91% | 83,482,484 |
| China | 11,022,844 | 13,684,715 | 24.15% | 75,193,973 |
| United States of America | 7,889,953 | 8,844,344 | 12.10% | 59,301,824 |
| Indonesia | 9,581,831 | 8,081,384 | -15.66% | 53,718,661 |
| France | 7,531,877 | 6,890,762 | -8.51% | 42,555,728 |
| Japan | 4,878,091 | 4,349,262 | -10.84% | 32,142,241 |
| Italy | 2,982,476 | 2,801,785 | -6.06% | 18,526,955 |
| United Kingdom | 2,032,597 | 907,151 | -55.37% | 12,033,858 |
| Germany | 1,494,064 | 1,536,194 | 2.82% | 10,830,744 |
| Malaysia | 1,059,582 | 967,617 | -8.68% | 6,321,099 |
| Poland | 1,092,594 | 864,185 | -20.91% | 4,893,364 |
| Switzerland | 773,436 | 674,637 | -12.77% | 4,578,077 |
| Taiwan | 521,744 | 476,230 | -8.72% | 2,984,425 |
| Ireland | 401,197 | 31,519 | -92.14% | 782,581 |
| Philippines | 21,872 | 27,386 | 25.21% | 273,753 |
| Other | 5,275,662 | 7,686,893 | 45.70% | 40,791,884 |
| Total | 120,760,661 | 119,662,551 | -0.91% | 796,330,505 |
Source: Vietnam General Department of Customs
That said, local production of cosmetics has also beefed up in recent years. According to Vietnam’s Industrial Production Index, July recorded increased production of cosmetics, soaps, detergents, polishes and hygiene products of 1.3 percent. Compared to July last year it saw an increase of 26.7 percent, as well as an increase from January to July 2024 over January to July of 2023 of 18.3 percent.
Box 1: Tik-Tok Shop is popular for buying and selling cosmetics in Vietnam
As of the end of November 2023, there were 2.8 million micro and small-t-medium sized businesses in Vietnam selling goods on TikTok. Cosmetics were among the most common goods sold through the platform. This is worth noting for foreign firms looking to sell cosmetics in Vietnam–it’s a low cost market entry option whereby firms can avoid putting boots on the ground until they are confident their goods will sell.
Key Players in Vietnam’s Cosmetics Market
Vietnam’s cosmetics market is a dynamic landscape characterised by a mix of domestic and international players. While foreign brands have historically dominated, local brands are increasingly gaining traction.
- My Pham Duoc Lien Ket: A pioneer in Vietnam’s cosmetics industry, My Pham Duoc Lien Ket has established a strong foundation with a wide range of skincare and haircare products, catering to the mass market.
- Conic: Targeting a younger demographic, Conic has gained popularity through its affordable yet effective skincare and makeup products, leveraging social media and influencer marketing to reach a wider audience.
- L’Oreal Vietnam: As a global beauty giant, L’Oreal has adapted its offerings to suit Vietnamese consumers, combining luxury and mass-market products. The company’s strong distribution network and marketing efforts have solidified its position in the market.
- Korean Beauty Brands: South Korean brands like The Face Shop, Etude House, and Innisfree have captured the hearts of Vietnamese consumers with their focus on skincare, innovative formulations, and trendy packaging. These brands have successfully leveraged K-pop and K-drama influence to drive sales.
- French Luxury Brands: Chanel, Dior, and Lancôme cater to the growing affluent segment in Vietnam, offering high-end products and exceptional customer experiences. These brands have capitalised on the increasing desire for luxury goods among Vietnamese consumers.
- American Brands: Estee Lauder and Maybelline have established a strong presence in the mass market segment, offering a wide range of affordable yet effective products. Their focus on product innovation and consumer-centric marketing has contributed to their success.
- Japanese Brands: Shiseido and SK-II cater to the premium skincare segment, emphasising quality, efficacy, and luxury. These brands have successfully positioned themselves as high-end alternatives for discerning consumers.
The Vietnamese cosmetics market is highly competitive, with both domestic and international players vying for market share. As consumer preferences evolve, companies that can adapt to changing trends and offer innovative products are likely to succeed.
Box 2: Thailand cosmetics firm enters Vietnam market with retail store in Hanoi
In 2023, Harnn, a Thai cosmetics brand, opened its first store in Vietnam in Hanoi, selling personal care and beauty products. The brand is also planning to open a second store in Ho Chi Minh City. Of note, Thailand was the third biggest source of cosmetics imported into Vietnam at the end of July.
Consumer Behavior in Vietnam’s Cosmetics Market
Vietnamese consumers are undergoing a significant shift in their beauty and personal care habits. The cosmetics market is benefiting from a growing middle class with increasing disposable incomes, leading to higher spending on beauty products.
Key Consumer Trends
- Skincare Focus: Vietnamese consumers prioritise skincare, with a strong emphasis on achieving flawless and radiant skin. This has driven demand for products addressing specific concerns like acne, whitening, and anti-aging.
- Natural and Organic Preference: There’s a growing inclination towards natural and organic cosmetics, driven by concerns about skin health and environmental sustainability.
- Digital Influence: Social media and online platforms have a profound impact on consumer behaviour. Vietnamese consumers are influenced by beauty influencers, online reviews, and tutorials.
- Value for Money: While there’s a demand for premium products, consumers also seek value for money. Affordable yet effective options remain popular.
- Brand Loyalty: While brand loyalty is developing, consumers are open to trying new products and brands, especially if they align with their desired benefits.
What’s next?
Vietnam’s cosmetics market has emerged as a dynamic and promising landscape, driven by a growing middle class with increasing disposable income. The market has witnessed rapid growth, with both domestic and international players vying for market share.
Key factors driving the market include rising consumer awareness of personal care, the influence of social media, and a growing preference for natural and organic products. While challenges such as intense competition and regulatory hurdles exist, the overall outlook for the Vietnamese cosmetics industry remains positive.
To capitalise on the market’s potential, businesses must focus on understanding consumer preferences, investing in product innovation, and building strong distribution channels. Additionally, adapting to the evolving regulatory environment and leveraging digital platforms will be crucial for success.
With this in mind, to keep abreast of what’s happening in Vietnam’s cosmetics industry, foreign cosmetics industry professionals should make sure to subscribe to the-shiv.