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

In February 2025, the China Cosmetics Association released data showing that the country's cosmetics industry achieved total channel transaction volume exceeding 1.1 trillion yuan, with domestic brands capturing a 57.37% market share, solidifying their dominant position.

For consumers overwhelmed by the sheer number of emerging domestic brands, the purchasing process often involves scrolling through reviews, watching product tests, and comparing prices before finally settling on a product. However, this careful selection may not always yield the expected results.

The "Group Warfare" of Domestic Beauty Brands

A recent social media post revealed an interesting discovery: a user comparing nose strips from two brands—RNW Ruwie and AUOU Aiyu—found that both products were manufactured by the same company and belonged to the same parent group. This post peeled back a little-known layer of the domestic beauty industry: consumers who believe they are choosing between different brands may simply be buying different products from the same company.

Operating multiple brands under one group is not new in the beauty industry. Estée Lauder, La Mer, MAC, and Tom Ford all belong to the Estée Lauder Group; Lancôme, Helena Rubinstein, Armani Beauty, and YSL Beauty are all under L'Oréal. While not all consumers are aware, many have at least heard of these corporate structures.

The same logic applies to domestic beauty brands, though consumer awareness is weaker. In fact, multi-brand matrices are now common among Chinese beauty groups:

• Proya Group: Proya, Off&Relax, Original Color Pot
• Chando Group: Chando, Meisu, Chunxia
• Marubi Group: Lianhuo, Chunji
• Juyi Group: Judydoll, Joocyee
• Shangmei Group: Kans, One Leaf
• Betry Group: Winona, Aokeman

Whether international giants or domestic brands, the core logic behind multi-brand strategies is similar: using different brands to cover various categories, price points, and consumer segments, thereby achieving broader market coverage and higher revenue. This matrix typically forms through two methods: acquiring established brands or incubating new ones. Either way, the underlying principle is differentiation.

Differentiation manifests in two main ways:

1. Filling category gaps: For example, Juyi Group, originally focused on color cosmetics with Judydoll and Joocyee, later acquired the China business of French brand René Furterer to enter scalp care, and then acquired Phyt's to enter scientific skincare. Similarly, Yixian E-commerce expanded from color cosmetics brand Perfect Diary into skincare, subsequently acquiring Galénic, DR.WU (China business), and EVE LOM.

1. Sub-segmentation within the same category: For instance, Proya's Original Color Pot, along with acquired brands Caitang and Huazhiyuan, are all color cosmetics but with distinct positioning: Caitang emphasizes Chinese aesthetics, Original Color Pot leans toward trendy styles, and Huazhiyuan focuses on anime-inspired styles. Similarly, Betry's skincare brand Winona targets sensitive skin, Aokeman positions itself as high-end professional anti-aging, and Befuting specializes in acne treatment.

Because of these differentiated brand positions, price points, and target audiences, consumers rarely realize these brands belong to the same company. However, not all "group-style" brands follow this differentiation principle.

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

Take Peilai Group as an example. While its brand matrix covers color cosmetics, skincare, and personal care, there is significant overlap in product lines—particularly in categories like foundation, concealer, facial cleanser, masks, and nose strips. Brand positioning is also largely mass-market, with prices generally under 100 yuan.

Notably, most groups take considerable time to build their brand matrices. For example, Shangmei Group launched Kans in 2003 but waited until 2014 to introduce One Leaf; Marubi launched Chunji in 2007 and added color cosmetics brand Lianhuo in 2017; Betry launched Winona in 2010 and Aokeman in 2022.

In contrast, Peilai Group's pace of new brand launches has been significantly faster. According to Qichacha, Peilai Group operates over 20 cosmetics companies, more than half of which have corresponding brand products available on shopping platforms (some sold through beauty stores rather than official shops). Public reports indicate that aside from UNNY Club and RNW Ruwie, which launched earlier, Peilai Group introduced a wave of new brands to the market in 2020 and 2021, including UODO Youwoduo, DPU Jianchu, TOCU Tanse, PIARA Peiran, JEJO Jijiu, BESNEA Beisini, and May.

Peilai Group's multi-brand strategy appears closer to a dense brand deployment approach, using quantity to achieve channel coverage. This means that while these brands operate nominally independently, they may actually compete for the same consumer base, creating a situation of "sibling brand" competition.

Product-Level Competition Among "Sibling Brands"

The competitive dynamics among "sibling brands" are most evident at the product level. Taking Peilai Group's nose strip products as an example, four brands—RNW Ruwie, EIIO Yiwu, DPU Jianchu, and AUOU Aiyu—all offer similar products with nearly identical specifications and prices: all come in packs of 5, with Tmall prices concentrated between 40-50 yuan, and prices on platforms like Pinduoduo dropping to 25-35 yuan.

With such similar pricing, consumers naturally find it difficult to perceive meaningful differences when shopping. The desire to purchase two products for comparison is understandable. And this "similarity" may stem from the fact that they are produced by the same contract manufacturing system.

According to Qichacha information, the manufacturers for nose strips from RNW Ruwie, EIIO Yiwu, DPU Jianchu, and AUOU Aiyu all point to Shanghai Zhumei Biotechnology Co., Ltd. or Guangzhou Yachun Cosmetics Manufacturing Co., Ltd., with Zhumei being a wholly-owned subsidiary of Guangzhou Yachun. Guangzhou Yachun has extensive OEM experience, having served not only Peilai's brands but also companies like Baiquelian, Tongrentang, and Xiuzheng Pharmaceutical.

Beyond shared manufacturers, a comparison of the four nose strip products reveals highly overlapping core ingredients. All commonly feature extracts of mushroom, white willow bark, burdock root, North American witch hazel, and lavender, with some adding purslane, chamomile, and centella asiatica.

The Brand-Manufacturer Relationship

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

In other words, Cosmax, which has a contract manufacturing background, has jointly established a new factory with Peilai and holds controlling interest. From this perspective, Peilai's focus appears to be less on product and more on brand management. The practice of operating multiple sub-brands selling similar products may essentially be a market-confusing strategy aimed at capturing market share in a single category through a "multi-pronged" approach.

Tmall flagship store data shows significant variation in sales performance among these nose strips, with daily sales ranging from 10,000+ to 500,000+ units. This means that even if one brand underperforms or its reputation declines, the group has other brands to absorb consumers.

However, negative effects also exist. Multiple brands crowding into the same market segment inevitably means some become "cannon fodder," hindering long-term brand equity accumulation. From the perspective of the overall domestic beauty industry, this is hardly beneficial.

Who Is Consuming the Domestic Beauty Dividend?

The rise of domestic beauty brands in recent years is evident. While increased supply of domestic products plays a role, the real driver of rising domestic market share is growing consumer trust in domestic brands.

This trust is particularly pronounced in the mass market. Budget-conscious students and young professionals tend to favor domestic beauty brands, even willing to try lesser-known names. However, this trust is also being exploited.

Today, some beauty brands' marketing strategies rely not on hard advertising but on seemingly neutral KOC (Key Opinion Consumer) content. Review articles often compare products with international luxury brands, where the international brands are always rated well, then highlight one or two domestic products as excellent, while positioning other domestic products as inferior. Faced with such seemingly "objective" evaluations, consumers struggle to distinguish genuine sharing from brand-orchestrated content.

Some brands also leverage video content, claiming "real" demonstrations with no filters and bare faces, while actually using localized beauty effects to make makeup results appear better than reality.

These strategies can easily open markets because the products themselves are low-priced, making consumer trial costs minimal. Even if a product doesn't work well, consumers don't feel too much regret. However, relying on false advertising to drive conversions goes beyond normal marketing. It damages the overall reputation of domestic beauty brands.

Regulatory Actions and Industry Challenges

Market regulators have issued numerous penalties for false advertising. For example, in January 2025, Peilai Group's brand JEJO was found to have product claims inconsistent with its registered efficacy for products including loose powder, eye and lip makeup remover, and isolation cream. The Suzhou Wujiang District Market Supervision Bureau determined this constituted false advertising and imposed administrative penalties.

Additionally, RNW Ruwie's nose strips and hair removal mousse have received multiple complaints on the Black Cat投诉 platform, with issues including allergies, acne, and redness, despite product pages claiming suitability for sensitive skin.

Problems also exist at the production end. In 2023, the Shanghai Drug Administration reported that Jinhua Keweisi Daily Chemical Co., Ltd. produced nail polish containing the banned ingredient 1,2-dichloroethane, involving brands like UNNY and Zhiyouquan. When checking this company on the Cosmetics Regulatory APP, almost all product listings showed as "cancelled." However, nail polish products under brands like Lemo and MINISO KH can still be found in the product registrations of its wholly-owned subsidiary, Jinhua Keweisi Cosmetics Co., Ltd.—though specific product names have changed. This suggests that even after a manufacturer is found to have problems, it can continue producing similar products for the same brands through affiliated companies.

The Path Forward

In the past, domestic beauty brands achieved scale growth through cost-effectiveness and channel advantages, with brand companies, manufacturers, and other industry chain participants all sharing in this growth. The next phase of growth for domestic beauty will depend on deeper consumer trust.

According to the China Association of Fragrance Flavour and Cosmetic Industries, the growth rate of China's cosmetics market in 2025 is projected at 2.83%, only slightly up from 2.80% in 2024—essentially flat. This indicates that the market has entered a low-growth phase, with narrowing incremental space. Retaining consumers and driving repeat purchases becomes increasingly critical.

If companies continue to package the same products under multiple brand names, use false advertising to drive conversions, and use affiliated companies to circumvent risks, consumer trust will erode with each instance. Without that trust, the long-term growth of domestic beauty brands will be unsustainable.