As international beauty brands consider global expansion beyond their home market, China, once on most brands' go-to list, is increasingly being redirected to the “too hard” pile. And for now, for some brands, that decision may be the right one.
The US still offers significant headroom for many brands. It is one large market, with major retailers and marketing platforms operating nationally in one language, so investment can scale further and faster. Europe is more fragmented, and regulation is strict, but the route to market is well established and relatively predictable. China requires a different ecosystem of platforms, partners, content, and consumer engagement, alongside greater localization and management attention, with far less certainty of return than it offered a decade ago.
But sitting China out has implications of its own, particularly for brands with global ambitions.
The caution is understandable. International brands have watched successful players struggle or retreat. In 2024 alone, brands including P&G's Tula Skincare, Shiseido's Baum, and L'Oréal's NYX closed their China operations or key sales channels. Local competition has become considerably stronger. The cost of building awareness is high, while the days of simply securing the right distributor or retailer to create momentum are largely gone.
Take Sephora, for example: Financials disclosed by its Chinese JV partner Shanghai Jahwa show Sephora was profitable in China from 2018 to 2021, with sales peaking at around $1.5 billion in 2021. Then the market changed, and Sephora didn't adapt fast enough. Beauty discovery increasingly shifted towards RED and Douyin, while Chinese brands became faster, stronger, and more relevant to local consumers. Sephora's proposition remained heavily centered on international prestige brands, and its differentiating factor was physical retail at a time when more of the consumer journey, from discovery through conversion, was moving onto China's digital platforms.
Ironically, China's 2021 animal-testing reforms also meant Sephora could finally bring in more of the international brands that made its assortment exciting in other markets. But access to better brands wasn't enough to reverse Sephora's decline. Many were still relatively unknown to Chinese consumers and required the brands themselves to invest significantly in local awareness through RED and Douyin content, key opinion leaders (KOLs) and key opinion consumers (KOCs) seeding, paid media, livestreaming, sampling, and platform traffic. Sephora could provide distribution, but it could not create consumer demand on a brand's behalf.
Sephora's global strength has always been its role as curator and discovery destination. In China, RED and Douyin increasingly filled that spot for consumers. Sephora is now responding more boldly. After adding six Chinese beauty brands in 2025, it brought in another 11 in April 2026, including Florasis, Perfect Diary, Judydoll, Funny Elves, and INTO YOU, taking the new local cohort to 17.
But if China's e-commerce ecosystem is currently the discovery point for Sephora, rather than Sephora being the introduction point for its consumers, what is Sephora's point of difference?
Benefit offers another example. Despite having built a sizable China presence, the brand closed its Tmall, JD, and Douyin flagship stores in 2024, reduced its distribution to Sephora, and has subsequently pulled out completely. Strong distribution and platform presence had not been enough to sustain consumer demand.
For international brands, there is a simple lesson: Distribution doesn't create demand.
Brands often make China too binary. Enter or don't enter. Find a distributor or don't. Open Tmall or don't. There is another option: understand the opportunity without committing to it.
Is your brand already being discussed on RED? Are products reaching consumers through resellers or daigous (overseas personal shoppers who buy and resell in Mainland China)? Which products are generating interest? Who does the Chinese consumer consider a brand’s competitors? How would your pricing sit against the local competitive set? And what investment is realistically needed to create meaningful demand?
The answers aren't a launch plan. They allow a brand to decide that China isn't a priority based on its own opportunity, rather than simply because other international brands have struggled.
Aesop offers an interesting contrast. Long before it officially launched in Mainland China, the brand was quietly building awareness and desirability. With an emphasis on organic rather than paid coverage, products were seeded to carefully selected KOLs—an unusually patient approach. The brand gave Chinese consumers the opportunity to discover Aesop before it tried aggressively to monetize that interest.
Aesop opened on Tmall Global in 2018 and subsequently built its presence across RED, WeChat, and other Chinese digital channels. By 2020, Tmall alone had generated around $9 million in sales, 112,000 transactions, and 214,000 enquiries.
Yet Aesop still didn't rush into physical retail. Its first mainland stores didn't open until late 2022—a brand-statement flagship store. By the time L'Oréal acquired Aesop for $2.5 billion in 2023, China was still a relatively small market for physical distribution, but the brand wasn't starting from zero. They’d spent years learning about the consumer and building premium desirability. L'Oréal could then do what a global beauty group is exceptionally well equipped for: scaling. When the acquisition was announced, China was identified as a major growth opportunity.
It’s difficult to pinpoint how much its presence in China contributed to Aesop's valuation. But a desirable global brand with evidence of Chinese consumer demand and significant distribution white space is clearly a more compelling growth story than one starting from scratch. China readiness isn't the same as China distribution.
For many beauty brands contemplating expansion into China, the answer today would genuinely be, not yet. There are better places to invest both money and time spent managing a brand there.
But that doesn't mean waiting five years and starting from zero. Brands can assess the opportunity now: understand the competitive landscape, identify ways to win, test consumer response, and determine the level of investment required for success.
Aesop spent years cultivating demand before scaling. Sephora, despite enormous resources and distribution, repeatedly found itself lagging in how Chinese consumers were discovering beauty.
The lesson isn't that every international beauty brand needs to enter China. It's that you don't need to enter China to start building an understanding of your opportunity there. For brands with global expansion ambitions, these assessments may be worth doing long before the decision to launch.
