Unlocking the Potential: Saudi Arabia’s Flourishing Beauty Industry
Beauty has always held a significant place in Saudi Arabia, but in recent years, the cosmetics market in the country has witnessed remarkable growth. A July 2023 report, “Decoding the Beauty Consumer in the GCC (Gulf Cooperation Council),” by Chalhoub Group, a luxury goods retailer and distributor headquartered in Dubai, revealed that Saudis are the leading spenders on beauty products in the Middle East.
The report, based on insights gathered from 2,600 consumers, four days of ethnography involving 30 participants, and interviews with over 15 experts, delves into three key areas: consumer purchasing trends, the evolving beauty standards in the region, and the most appealing categories for GCC customers.
Saudi Arabia’s beauty market is rapidly expanding, especially in the luxury, beauty, and fashion sector. “The Saudi beauty market is an emerging market with incredible opportunity for development, and it is currently experiencing rapid growth, making it one of the fastest-growing in the GCC,” says Larabella Riaz, founder and CEO of The BDinc, a youthful beauty distribution firm based in Dubai Design District.
One prominent factor contributing to this growth is the youthful demographic, with over half of the population under 30 years of age. Strong beauty retailers like Sephora, Faces, and Al Nahdi in Saudi Arabia have been quick to adapt and expand their offerings to keep pace with the industry’s growth.
The Chalhoub report underlines that Saudi women are among the most avid consumers of makeup and fragrances, finding inspiration primarily from social media. Traditional retail remains the dominant channel for beauty product purchases, with fragrances accounting for a substantial share of spending in the Middle Eastern beauty market.
Eyes play a central role in Saudi beauty routines, with eyeshadows and mascaras taking center stage. These products have seen substantial growth, with eyeshadows and mascaras increasing by 71% and 83%, respectively, over the past three months.
According to Expert Market Research, the Saudi cosmetic products market is projected to grow at a compound annual growth rate of 5.6% between 2023 and 2028, driven by rising demand for organic and personal care products.
Saudi consumers are savvy and unafraid to mix and match brands to identify the best products from each. Changing social and cultural norms in the Kingdom have led to a greater emphasis on self-expression and individualism, further boosting the demand for beauty and cosmetic products.
Several factors have fueled market growth, including the Kingdom’s economic diversification beyond hydrocarbon-based industries. Increased disposable incomes and a shift towards luxury and beauty products have been notable outcomes of this economic transformation. Digital transformation, particularly the rise of e-commerce and social media, has made beauty products more accessible to a wider audience.
Halal beauty products have also gained prominence in the Kingdom as Muslim women engage more actively in society. The beauty industry’s allure has captured the attention of both companies and consumers worldwide.
McKinsey & Co. reported that the beauty industry, encompassing skincare, fragrance, makeup, and hair care, generated approximately $430 billion in revenue in 2022, with expectations of reaching $580 billion by 2027, growing at a rate of 6% per year.
While China remains the industry’s largest market, the Middle East and India are identified as the most promising regions poised for significant growth. The industry’s expansion across the Gulf has prompted brands to develop region-specific strategies tailored to the preferences and styles of local Arab consumers.
Notably, the Chalhoub report highlights a shift in beauty standards within the GCC market, moving away from Euro-centric ideals toward a desire for more Arabic and Middle Eastern features. Consumers now seek authenticity, celebrating unique beauty and features. Local celebrities and influencers who embody Arabic beauty are gaining prominence.
This shift is mirrored in the rise of homegrown Saudi beauty brands, such as Asteri, founded by Riyadh-based Sarah Al-Rashid. Asteri, the first Saudi clean vegan makeup brand, takes inspiration from Saudi heritage in its design, color choices, and motifs, incorporating local natural ingredients.
With a growing interest in self-care products that are natural and eco-friendly, the beauty market in Saudi Arabia is expanding. Gen-Z in Saudi Arabia is increasingly adopting skincare, makeup, and hair care products, leading to a surge in spending on these items across the nation.
Saudi Arabia’s beauty market is not only growing but evolving in response to changing demographics, cultural norms, and global beauty trends. Al-Rashid believes the expanding job market for women has also played a role in the growth of the Saudi beauty market, as women are now more active in public life.
The vision for Saudi beauty brands extends beyond local markets, with a global reach in mind. The transformation in the Saudi beauty industry is a reflection of broader societal shifts and the Kingdom’s continued commitment to economic diversification.