Are expensive cosmetics really better?

Are cosmetics better the more expensive they are? There is a saying that makes sense: expensive ones may not necessarily be good, but good ones will definitely be relatively expensive.

1. Where do you spend your money on skin care products?

① Brand. What determines the price of cosmetics is not the price of the product itself, but the brand itself. Therefore, advertising investment to build a brand is very important for skin care products.
Let’s take the L’Oreal Group as an example to see how cosmetics companies spend and earn money.

We can see that:

1. The gross profit margin of L’Oreal Group’s products is 71.1%. Here, the gross profit margin is calculated as: (sales-sales cost)/sales.

2. The largest expense is advertising and promotion expenses, reaching 29.1%, and the related channel, administrative and other management expenses are as high as 21.4%. These two items together account for 50.5% of the expenses.

3. R&D expenses are 3.4%, which is already a very high R&D investment. Few cosmetics companies can exceed this investment ratio, let alone domestic cosmetics companies.

It can be seen that most of the costs are contributed to marketing and channels, accounting for half of the price, 50.5%.

② Product itself: Let’s look at the product itself. In fact, this part of the cost is included in the sales cost, which accounts for 28.9%. Because the sales cost here includes the raw materials, cosmetic packaging materials, production and manufacturing, logistics and transportation costs in the product. And what is related to us is only the packaging materials and raw materials of cosmetics. Excluding production and logistics costs, the cost of raw materials accounts for a lower proportion of the sales cost.

And the products in our hands, what really determines the effect of the product is the cosmetic raw materials. But the sad fact is that in many cases, the price of packaging materials for the skin care products we get is greater than the price of the contents composed of raw materials!
So, you can imagine how much of the raw materials are in the 28.9% sales cost.

2. Will different prices lead to different ingredients?
The proportion of raw material cost in product price is pitifully small. If cosmetics want to pursue gross profit margin, they will strictly control product cost. That is to say, when the channel cost and promotion cost, which are the money that enterprises must spend outside, cannot be changed, the best thing to do is to start from the inside, from their own products, in order to increase gross profit. Streamlining costs is a good choice, especially for low-end domestic products under traditional channels. Due to fierce competition, gross profit margins are already very low, and they are very sensitive to raw material formula costs. They are no longer able to make products with high raw material costs.
But if it is a high-end product, the profit margin is large, and more money will be spent on the product itself, but this is more of a matter for high-end foreign brands. From this point of view, you get what you pay for, which is true. But there are also times when it is not true. Even for high-end brands, it does not necessarily mean that the cost of the raw materials used will be very high. Why must you use expensive formulas to make something that can be made with low prices? Bosses always want to earn a little more. I can talk a little more about this, because cosmetics companies usually use one formula for different brands. By changing the fragrance or adding a little ingredient for promotion, it can be used for different brands.

According to experts, the core ingredients of the two essence products, Lancome’s Little Black Bottle and L’Oreal Paris’ Little Black Bottle, are “Bifida Ferment Lysate”. Bifida Ferment Lysate is an ingredient that can enhance the metabolism of the skin’s stratum corneum and play a role in cell repair. It ranks second in both ingredient lists, which means that the content is not low.

The more familiar moisturizers, such as sodium hyaluronate and other active ingredients, are both in both products, but they are arranged in front and back. That is, in order to adjust the feeling of use or match the effects of other ingredients, the dosage is adjusted.

3. Will different ingredients lead to different effects of skin care products?

Yes. Ultimately, the difference in ingredients (and technology) leads to different effects of skin care products. Because the technology used by each company is different, and your skin needs different products, you will have the most suitable one among different brands of cosmetics. For example, some people say that niacinamide is good for whitening, but some people don’t feel anything or feel irritated after using it. Some people use VC for whitening, and the effect is very good, but some people say that they can’t love it without any effect. Therefore, the ingredients in the formula and the technology and process used are the determining factors for the skin care effect.

Even if the raw materials look the same, the different amounts of raw materials will bring certain differences to the products. So from the raw material list alone, the two cannot be completely equated. Experts also said that although the cost of raw materials between the two will not be too different, it is understandable that the difference between the two products is inevitable. Therefore, cosmetics are not the more expensive the better. When using skin care products, everyone should be good at summarizing the ingredients that suit them, and not be kidnapped by the brand and pay for the brand’s expensive advertising fees.

1. Skin care products of different prices from the same company may use the same technology and even the same formula. Therefore, it cannot be said that the higher the price, the more effective the product is. It should be judged by looking at the ingredient list.
2. Skin care products of different companies and prices usually use better ingredients if they are more expensive, but this is not always the case, because there are too many cases where big brands use ordinary ingredients and sell them at high prices.
3. What determines the skin care effect is not the price of the cosmetics, but the effective ingredients and the formula technology used, as well as the degree of compatibility between the product and your skin and environment.