As the Spring Festival approaches, the number of consumers consulting and seeking treatment at medical beauty institutions has increased significantly, and some popular projects require advance reservations. In the current economic environment, is there any difference in the market conditions around this year's Spring Festival compared to before? What are the main factors affecting the significant differences in the medical aesthetics market across different regions? What are the challenges in the medical aesthetics industry? How can institutions break through profit growth points?
Frost & SullivanFrost & SullivanZhu Yiming, Executive Director of Frost & Sullivan Greater China Region (hereinafter referred to as 'Frost & Sullivan'), answered Cainiao Communications Interview, jointly discussing the development of the medical aesthetics industry.
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Cailian Finance & Economics News Agency
Q
In the current economic environment, is there any difference in market conditions around this year's Spring Festival compared to before?
Based on past experience, due to the favorable period for post-surgery recovery and adjustment during short holidays such as the Spring Festival, there is usually a peak in medical beauty consumption before the holidays. Compared to previous years, we believe that this year's trend of consumer growth in the medical beauty market will be more pronounced.
Judging from the economic development situation,2023The year was the first after the relaxation of pandemic restrictions, with residents' travel and offline service consumption no longer constrained, and the macroeconomy recovering steadily. During this year, indicators such as per capita consumer expenditure and per capita service consumption expenditure both achieved positive growth after the pandemic, with year-on-year increases respectively.9.0%and14.4%, higher than2022That year-0.2%and-0.5%The growth rate level. Therefore, it is expected that in2024In the year, as the negative impact of the pandemic on economic development and consumption growth further subsides, per capita consumer expenditure among residents will continue to increase. The momentum of medical beauty consumption will continue to be released, and the consumption peak around this year's Spring Festival holiday has also seen a significant increase compared to previous years.
Q
What are the main factors affecting the significant differences in the medical aesthetics market across different regions?
In China today, there are often differentiated characteristics among medical beauty consumers and institutions across different regions. Indeed, there are significant differences in market development, mainly due to differences in economic development, regional culture, regulatory priorities, and other aspects between different cities and regions:
Firstly, consumers in different regions have varying demands and concerns regarding medical aesthetics. There are differences in the economic development levels of different regions, such as first-tier cities which have higher economic development levels, average per capita income and consumer spending. Consumers generally have a stronger awareness, willingness, and ability to consume medical aesthetics. Therefore, there are numerous medical aesthetics institutions in economically developed areas such as first-tier cities, and competition is often more intense. Price wars and service innovation are common competitive strategies.
Secondly, the regulatory intensity and focus vary across regions, which can also lead to different development situations in the regional medical beauty market. For example, Beijing may have stricter compliance supervision and review, while Hangzhou encourages diversified medical beauty institutions to compete fully, placing more emphasis on enterprise openness and innovation, as well as service quality improvement. This results in different development priorities for medical beauty institutions in different regions during their development.
Q
What are the remaining challenges in the medical aesthetics industry?
In the past, the medical aesthetics industry experienced a period of sustained high growth, but it also faced many challenges such as 'compliance', 'difficulty in acquiring customers', 'scarcity of high-quality doctor resources', and 'low net profit'. For example, difficulty in acquiring customers and high marketing costs have become another major issue hindering industry development. Nowadays, most medical aesthetics institutions spend too much on customer acquisition and do not manage their controllable costs as meticulously as they should, making it difficult to significantly increase their net profit levels. Many medical aesthetics service providers have fallen into a predicament of high investment, low conversion, and slow transactions.
Q
How can institutions break through profit growth points?
Today, the business methods and concepts of various medical aesthetics service institutions are too similar, lacking innovation and differentiated competitive advantages. Many institutions focus too much on product-level competition while neglecting the enhancement of product added value, resulting in limited life cycle value that can be provided to customers, making it difficult to attract users and enhance customer loyalty in the long term. Therefore, for medical aesthetics service institutions to achieve profit growth, model innovation, technological advancement, and precise targeting of consumer groups are breakthrough points.
Model innovation and technological advancement are important ways to achieve the goal of profitability. Through changes in business models, some leading companies in certain industries are gradually emerging from fierce competition. The iteration of business models involves reorganizing and optimizing existing assets, while technological innovation drives industry transformation into new growth areas in the future. Therefore, while accelerating business model innovation, technological advancement in the industry must also proceed side by side without contradiction.
In addition, as the consumer understanding and demand for medical aesthetics mature, their needs for medical aesthetic products and services have become more diversified. Facing the complex market environment and increasingly fierce competition, upstream manufacturers and medical aesthetic service institutions need to accurately understand the core needs of medical aesthetic consumers, establish solid trust links, in order to succeed in the next cycle of the medical aesthetics market.
* This interview was published in Cailian Finance & Economics News Agency Reporter: Why Fan, original title: The small peak of medical aesthetics is upon us! A wave of demand before the Spring Festival, why are practitioners complaining?
