AI in beauty is reshaping China’s market, transforming how products are developed, marketed, and delivered to consumers. The Chinese beauty industry is growing at 3.71% and is projected to reach $73.66 billion USD in the year 2025, making China the second-largest beauty market globally, after the United States. Yet behind the strong topline growth lies an intensifying competitive landscape. Chinese beauty consumers are becoming more rational, expecting greater personalization, value for money, and transparency. At the same time, the rapid rise of local brands and the aggressive push of global players have intensified market pressures. Companies that cannot compete on price or keep pace with advanced digital marketing quickly lose ground.
Source: Statista, designed by Daxue Consulting, provides the revenues and segmentation of the Chinese beauty industry from 2018 to 2025, along with predictions for 2026 to 2030
In this environment, AI has emerged as the defining differentiator in the Chinese beauty industry, used initially to cut costs and gain efficiency, and has now evolved into full integration across R&D pipelines, retail channels, and customer tracking and engagement.
Evolving Chinese Consumer Expectations for Beauty Products
Consumer in the Chinese Beauty industry is mainly 25-35-year-old female (61.5%) with a rising population of Gen Z buyers(20%).
Due to the post-pandemic tension, consumers have become more rational and value conscious. Even high-end buyers now emphasize value for money, while mass consumers prioritize safety, functionality, and product quality.
Trending keywords on Chinese social media such as Minimalist skincare (极简护肤) and functional skincare (功效护肤) show what’s dominating mainstream demand, while anti-aging products stand out as the fastest-growing segment, registering a 30% increase in the first half of 2025. According to the People Data Institute’s 2024 report, Chinese consumers, especially the younger generation, are becoming far more ingredient-literate and favor beauty products that are science-backed, clinically proven, and transparent in formulation.
Source: Xiaohongshu @Anna, detailed guide on skincare chemicals titled “Essential Skincare Knowledge for Girls.”
At the same time, buying behavior is becoming scene-based: consumers increasingly seek skincare tailored to their skin type, lifestyle, and environment. This shift highlights a deeper demand for personalization and data-driven product design, creating fertile ground for AI-enabled customization to become a decisive competitive advantage.
Source: Statista, designed by Daxue Consulting, provides the purchasing criteria of Chinese consumers for beauty products as percentages for 2025
Struggles of Traditional Models in China’s Beauty Industry
Rising competition in the Chinese beauty market
According to Xiaohongshu’s 2024 Beauty Report, the number of domestic Chinese makeup and skincare brands expanded by 12% between 2021 and 2023. This surge reflects not only the sector’s growth potential but also intensifying competition. At the same time, rising ingredient literacy and demand for higher quality are pushing both domestic and international players to step up research and development investment and innovation to defend market share.
Structural Inefficiencies That AI in Beauty Can Solve
In the increasingly homogeneous Chinese beauty industry, traditional models are constrained by structural inefficiencies. High labor costs and escalating marketing expenditures have triggered price wars, eroding profitability while delivering limited differentiation. At the same time, conventional R&D cycles, often stretching 18 to 24 months, cannot keep pace with consumers’ fast-changing preferences, leaving brands unable to respond with agility. Product launches tend to be generic rather than personalized, failing to address individual needs or build loyalty. Compounding these issues, blanket marketing approaches without credible, data-driven backing have lost effectiveness in an era where ingredient-savvy consumers demand transparency and proof.
Chinese Government Policy Support for AI in Beauty
China’s 14th Five-Year Plan (2021–2025), the country’s national economic and social development blueprint, identifies AI innovation and the digital economy as national priorities. Beauty, positioned within the broader “beauty and health” industry, benefits directly from this policy emphasis. The result is a regulatory and investment environment that lowers the barriers for brands to integrate AI while pushing the sector toward higher standards of safety, compliance, and innovation.
Building on this agenda, the National Medical Products Administration (NMPA) released the Guidelines for AI Technology Services in Cosmetics, providing clear standards for AI applications in product testing, safety assessment, and personalized services. At the same time, AI-powered diagnostic devices for medical aesthetics have been included in national health insurance pilots, underscoring both the government’s confidence in the technology and its intent to expand adoption in clinical and consumer-facing scenarios.
Leading cities such as Beijing, Shanghai, Shenzhen, and Guangzhou are rolling out local initiatives that combine regulatory frameworks with financial incentives in 2025. These include subsidies for AI-driven transformation, funding for high-end device R&D, and the establishment of big data platforms that enable industry-wide collaboration. Taken together, these policies are accelerating the shift from fragmented, experimental AI adoption to a structured, large-scale transformation—positioning China as one of the most proactive regulators and promoters of “AI + Beauty” globally.
Practical Evidence: How Chinese Beauty Brands Are Using AI
AI in Beauty: Transforming Product Development in China
AI is fundamentally changing product development in China’s beauty industry. Traditional R&D cycles of 18–24 months are no longer competitive in a market where consumer preferences shift rapidly. With AI-driven formulation simulation, companies can now reduce cycle times by up to 40%.
Source: Florasis, “Multi-dimensional Holographic AI Sensory Behavior Research System,” unveiled at the 5th China International Consumer Products Expo
Florasis, a prominent Chinese beauty brand, became well known for its oriental-inspired design and its “user co-creation” model of product development. At the 2025 China International Consumer Products Expo, the brand introduced its “Holographic Sensory System,” an AI-driven innovation that collects and analyzes brainwave activity, eye movements, and micro-expressions. These signals are transformed into measurable data that guide improvements in texture and color payoff, turning individual perceptions into actionable inputs for product design.
AI in Beauty for Service and Personalization
Source: Dr.Jing, ”AI robots”
Chinese wellness brand Dr. JING Group’s MYAI robot delivers acupoint-targeted massage through 3D vision and adapts to voice commands for a personalized service experience. Its health companion system can scan 7,000 biometric indicators in just five minutes, producing individualized assessments. Another module generates personalized plastic surgery consultation plans in minutes, using a database of thousands of faces to replace subjective judgment with algorithmic precision. Then the system communicates with users through its DeepSeek-backed platform.
AI in Beauty as a Marketing Game-Changer
Since 2022, livestreams hosted by digital humans (AI avatars) have gained high traction among beauty brands in China. With advances in large language models and AI training, leading brands are increasingly confident in launching their own AI livestream hosts: solutions that guarantee steady viewership, consistent quality, and manageable price.
Source: MaoGePing AI streaming Host and real-time AI reply in the comment section
In 2025, MaoGePing, a high-end Chinese makeup brand, introduced an AI streaming host who has 90% capability as a real human host for answering detailed skincare questions and demonstrating products, but does it 24/7 without rest. Powered by natural language understanding (NLU), the system delivers rapid AI-driven Q&A, real-time shopping assistance, and seamless user interaction.
AI in Beauty for the Intelligent Store Experience
Source: Sephora, a picture of its Shanghai store
In Shanghai, Sephora has introduced an advanced in-store AI-powered skin analysis device that uses UV optical scanning to assess deeper layers of the skin, offering highly personalized skincare recommendations. Alongside this, an AI and augmented reality makeup tablet provides tailored tutorials and product suggestions, allowing customers to visualize different looks in real time.
AI in China’s Beauty Industry: The New Competitive Edge
- AI is transforming China’s beauty industry from product development to consumer engagement, redefining how brands compete.
- Consumer demand is shifting toward transparency, science-backed efficacy, and personalization, creating pressure on traditional models.
- Government policy actively accelerates adoption, with subsidies, guidelines, and pilots that lower costs and de-risk innovation.
- AI is now embedded across the value chain: speeding up R&D cycles, powering personalized services, enabling 24/7 marketing, and enhancing in-store experiences.
- Winners will be those who leverage AI not just for efficiency but as a source of differentiation and consumer trust. Laggards risk rapid irrelevance in an intensely competitive market.
