Chinese Beauty Brands Go Conglomerate: Consumers May Be Buying from the Same Company Across Different Brands

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Market Overview: Domestic Brands Dominate with 57.37% Share

In February 2025, the China Cosmetics Association released its annual data series on the country's cosmetics industry, revealing that total industry transaction volume across all channels exceeded 1.1 trillion yuan. Domestic brands have solidified their market leadership, capturing a 57.37% share.

Faced with a proliferation of domestic brands, many consumers suffering from "choice paralysis" often find themselves scrolling through reviews, watching product tests, and comparing prices before finally selecting a product to purchase. However, behind this meticulous selection process, the outcome may not always be as expected.

The "Same Family" Discovery

Not long ago, a netizen posted on social media, stating that while trying to compare pore strips from RNW Rúwēi and AUOU Àiyù, they unexpectedly discovered that both products were manufactured by the same company, and both brands belonged to the same parent corporation. This post peeled back a little-known layer of the domestic beauty brand landscape: consumers who believe they are choosing between different brands may, in reality, simply be buying products from the same company.

The Rise of "Group Warfare" in Domestic Beauty

It is not uncommon in the beauty industry for a single conglomerate to operate multiple brands. Estée Lauder, La Mer, M·A·C, and Tom Ford all belong to the Estée Lauder Group; Lancôme, Helena Rubinstein, Giorgio Armani Beauty, and YSL Beauty are all under the umbrella of L'Oréal Group. While not all consumers may be fully aware, most have at least heard of this structure.

When the same logic is applied to domestic beauty brands, consumer awareness is significantly weaker. In reality, the multi-brand matrix strategy is already widespread among Chinese beauty groups. For example:

• Proya owns Proya, Off&Relax, and Yuansè Bōtǎ
• Chando owns Chando, Meisu, and Chunxia
• Marubi owns Marubi, Lianhuo, and Chunji
• Judydoll Group owns Judydoll and Joocyee
• Shanghai Chicmax owns Kans and One Leaf
• Botanee owns Winona, Aokeman, and more

Whether international giants or domestic players, the core logic behind a multi-brand strategy is essentially the same: use different brands to cover different categories, price points, and consumer demographics, thereby achieving broader market coverage and driving higher revenue.

This multi-brand matrix is typically formed through two methods: acquiring established brands or incubating new ones in-house. Regardless of the approach, the underlying principle is usually differentiation.

Two Levels of Differentiation

1. Filling Category Gaps: For instance, Judydoll Group, originally focused on color cosmetics with Judydoll and Joocyee, later acquired the China business of French brand Furterer to enter the scalp care segment, and then acquired Bzhi to move into science-based skincare. Similarly, Yatsen Global expanded from its color cosmetics brand Perfect Diary into skincare, subsequently acquiring Galenic, DR.WU (China business), and EVE LOM.

1. Sub-segmentation Within the Same Category: For example, Proya's Yuansè Bōtǎ, along with its acquired brands Caitang and Huazhixiao, are all in the color cosmetics space but target different niches: Caitang focuses on Chinese-style aesthetics, Yuansè Bōtǎ leans towards trendy styles, and Huazhixiao is dedicated to the anime-inspired "two-dimensional" youth style. Similarly, Botanee's skincare brand Winona targets sensitive skin, Aokeman is positioned as a high-end professional anti-aging brand, and Beifuting specializes in professional acne treatment.

Because of these distinct brand positions, price points, and target audiences, consumers are less likely to realize that these brands belong to the same parent company. However, not all "group-style" brands adhere to this differentiation principle.

The Case of Peilai Group: A Different Strategy

Take Peilai Group as an example. While its brand matrix covers categories like color cosmetics, skincare, and personal care, there is significant overlap in product lines among its sub-brands, particularly in categories such as foundation, concealer, facial cleanser, face masks, and pore strips. Furthermore, most of its brands are positioned in the mass market, with prices generally under 100 yuan.

It is worth noting that most groups take a considerable amount of time to build their brand matrix. For example:

• Shanghai Chicmax launched Kans in 2003 and did not introduce One Leaf until 2014.
• Marubi launched Chunji in 2007 and only added the color cosmetics brand Lianhuo in 2017.
• Botanee launched Winona in 2010 and introduced Aokeman in 2022.

In contrast, Peilai Group's pace of launching new brands has been significantly faster. According to Qichacha, Peilai Group has over 20 cosmetics-related subsidiaries, and more than half of them have corresponding brand products available on shopping platforms (some sold in beauty boutiques rather than official stores). Jingyan Research Institute found, through public reports, that aside from UNNY Club and RNW Rúwēi, which were launched earlier, Peilai Group introduced a wave of new brands to the market between 2020 and 2021, including UODO Yōuwòduǒ, DPU Jiǎnchū, TOCU Tànsè, PIARA Pèirǎn, JEJO Jījiǔ, BESNEA Bèisīní, and ONLY MAY.

Overall, Peilai Group's multi-brand strategy appears closer to a tactic of densely deploying brands to capture channel coverage through sheer quantity. This implies that while these brands operate nominally independently, they may actually be competing for the same pool of consumers, creating a situation of "brother brands" competing against each other.

From "Multi-Brand" to "Brand Manufacturing"?

The competitive dynamics among "brother brands" are most evident at the product level. Take Peilai Group's pore strip products as an example. Brands under its umbrella, including RNW Rúwēi, EIIO Yìwò, DPU Jiǎnchū, and AUOU Àiyù, all offer similar products with nearly identical specifications and prices:

• Specifications: Uniformly 5 strips per pack
• Price (Tmall): Concentrated in the 40–50 yuan range
• Price (Pinduoduo): Lowered to 25–35 yuan

With such close pricing, it is naturally difficult for consumers to perceive significant differences when making a purchase, making it unsurprising that some would buy two products to compare. This "similarity" may stem from the fact that they are likely produced by the same contract manufacturing system.

Shared Manufacturing and Ingredients

Jingyan Research Institute's investigation via Qichacha found that the manufacturers for the pore strips from RNW, EIIO, DPU, and AUOU are all either Shanghai Zhumei Biotechnology Co., Ltd. or Guangzhou Yachun Cosmetics Manufacturing Co., Ltd., with Zhumei Biotechnology being a wholly-owned subsidiary of Guangzhou Yachun. Guangzhou Yachun has extensive OEM experience, having also served brands like Baiquèquè, Tongrentang, and Xiuzheng Pharmaceutical.

Beyond shared manufacturers, a comparison of the four pore strip products revealed a high degree of overlap in the core ingredients highlighted in their marketing. They commonly feature extracts of shiitake mushroom, white willow bark, burdock root, witch hazel, and lavender, with some adding ingredients like purslane, chamomile, and centella asiatica.

Blurred Lines Between Brand and Manufacturer

The relationship between brand owners and manufacturers goes beyond simple contracting. For instance, the manufacturer for a concealer product from Peilai's brand UNNY is listed as Peilai Cosmetics (Shanghai) Co., Ltd. Qichacha records show that one of the shareholders of this company is Cosmax (China) Cosmetics Co., Ltd., holding an 80% stake, while the other shareholder is a wholly-owned subsidiary of Peilai Group.

In other words, Cosmax, a contract manufacturer, has partnered with Peilai to establish a new factory, in which Cosmax holds a controlling interest. This suggests that Peilai's core focus may not be product development but rather brand management. Therefore, the practice of operating multiple sub-brands with similar products could be a strategy to confuse the market, aiming to capture market share in a single category through a "multi-pronged" approach.

Data from Tmall flagship stores shows significant sales divergence among these pore strips, with daily sales figures ranging from 10,000+ to 500,000+. This means that even if one brand underperforms or its reputation declines, the group has other brands ready to absorb its consumers.

However, there are negative consequences. Multiple brands crowding into the same niche market inevitably means some will become "cannon fodder," hindering the long-term accumulation of brand equity for individual brands. This is also arguably detrimental to the overall development of the domestic beauty industry.

Who is Consuming the Domestic Beauty Dividend?

The rise of domestic beauty brands in recent years is evident. While this is partly due to an increased supply of domestic products, the real driver of the rising market share is growing consumer trust in domestic brands.

This trust is particularly strong in the mass market. Budget-conscious students and young professionals are more inclined to choose domestic brands, often willing to try even lesser-known names. However, this trust is also being exploited.

The Rise of Deceptive Marketing

Today, some beauty brands' marketing strategies rely not on hard-sell advertising but on seemingly neutral KOC (Key Opinion Consumer) seeding. Review articles often compare products with international luxury brands, where the international brands are always rated as "not bad," while one or two domestic products are highlighted as "very effective," and other domestic products are made to look inferior. Faced with these seemingly "objective" reviews, consumers struggle to distinguish genuine sharing from brand-orchestrated content.

Some brands also leverage video content. For example, makeup tutorials claiming to be "real," "filter-free," and "bare-faced" may actually use localized beauty filters to make the makeup effect look better than reality.

These tactics can easily open up the market because the products themselves are inexpensive, making the consumer's trial cost relatively low. Even if a product is not good or suitable, consumers are less likely to feel a significant loss. The problem, however, is that relying on false advertising to drive conversions goes beyond normal marketing. It is akin to "biting the hand that feeds you," damaging the overall reputation of domestic beauty brands.

Regulatory Actions and Consumer Complaints

Regulatory authorities have already issued numerous penalties for false advertising. For example, in January 2025, Peilai Group's brand JEJO was penalized by the Suzhou Wujiang District Market Supervision Administration for publishing false advertisements, as the efficacy claims for its loose powder, eye and lip makeup remover, and primer did not match the product's registered efficacy.

Furthermore, products from Peilai's brand RNW, such as its pore strips and depilatory mousse, have been repeatedly complained about on the Black Cat Complaint Platform, with issues including allergies, acne, and redness, despite product pages claiming suitability for sensitive skin.

Problems in the Supply Chain

Issues are not limited to the brand side but also exist among manufacturers. For instance, in 2023, the Shanghai Drug Administration reported that nail polish produced by Jinhua Keweisihui Daily Chemical Co., Ltd. contained the banned ingredient 1,2-dichloroethane, involving brands like UNNY and Zhiyouquan. When Jingyan Research Institute checked this company on the Cosmetics Regulatory APP, almost all of its product listings showed as "cancelled." However, nail polish products for brands like Làimò and MINISO KH could still be found in the product filings of its wholly-owned subsidiary, Jinhua Keweisihui Cosmetics Co., Ltd., albeit under different product names. This indicates that even after a manufacturer is flagged for violations, it can continue producing similar products for the same brands through affiliated companies.

Conclusion: The Next Stage Depends on Trust

In the past, domestic beauty brands achieved scale growth through cost-effectiveness and channel dividends, with all links in the industry chain—brand owners and manufacturers alike—sharing in this growth. The next phase of growth for domestic beauty, however, will depend on deeper consumer trust.

Data from the China Association of Fragrance Flavour and Cosmetic Industries shows that the growth rate of China's cosmetics market in 2025 is projected to be only 2.83%, up slightly from 2.80% in 2024. This indicates that the market has entered a phase of low-speed growth, where incremental space is narrowing. Retaining consumers and driving repeat purchases have become critical.

If companies continue to package the same products under multiple brand names, use false advertising to drive sales, and use affiliated companies to circumvent risk, consumer trust will be gradually eroded. Without this trust, the long-term growth of domestic beauty brands will be unsustainable.

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