I. ‘Dupes’ or so-called cheaper alternatives
- ‘Dupe’ refers to cheaper alternative for products that are from famous brands, but with similar ingredients and features.
- These dupes are usually found in essence(skincare) and lip makeup categories. In the case of essence, luxury brands from overseas tend to be expensive, so the demand for local products with similar features is high. In other words, dupes in essence category is a substitute for expensive brands’ products.
- Lip makeup category shows a different pattern: the purchase for dupes in this segment is a ‘duplicate purchase.’ Consumers buy both expensive brand and cheap brand, and use low-priced ones at home, and carry famous brands in their purse.
- We will focus on essence in this article, since the substitution effect is more apparent in that category.
II. Dupes are more popular than originals in the local market
4 out of Top 5 best-selling essence products in the first half of 2019 are dupes.
1) Derfriend essnce vs. SK-II aura essence
: Derfriend essence sold the most in the first half of this year. Also known as “small lamp” or “silver fatty” among Chinese locals, the product has great whitening effects and affordable price. The product gained more popularity after the famous KOL Li Jiaqi promoted the brand in Taobao Live channel. The price is 1/10 of SK-II aura essence.
Figure1. Sales trend of Derfriend and SK-II essence
2) L’oreal Youth code essence vs. Lancome Genifique
: L’oreal essence is similar to Lancome Genifique in that it is contained in a dark, transparent bottle, made from fermented ingredients, and that it bring youth back to your skin. The price is about half that of Genifique.
Figure2. Sales trend of L’oreal and Lancome essence
3) USIII Gold essence
: This products has many copycats, but is not necessarily a dupe for any luxury brand products.
4) Olay white essence vs. SK-II aura essence
: Olay essence focuses on whitening for a price that is 1/5 that of SK-II. Unlike Derfriend’s essence, which is a dupe for the same product, this is from an overseas brand, not local, and the price is about 50% higher than that of Derfriend.
Figure3. Sales trend of Olay and SK-II essence
5) Beauty sign capsule vs. Elizabeth Arden essence
: This product has the same design as Elizabeth Arden’s in that the daily dosage is contained in individual capsules. Beauty sign’s product price is about 35% of that of Elizabeth Arden.
Figure4. Sales trend of Beautysign and Elizabeth Arden essence
III. Perks of using dupes
All the dupes mentioned above show higher revenue than their original counterparts, and the sales growth rate is higher as well. We see the following three as the main reasons.
1) Price competitiveness
: People find it easier to buy and try the dupes because the price is more affordable. Also, people tend to use more of the product because it is cheaper. Thanks to their price competitiveness and prominent effects on the skin, there is a constant demand for dupes.
2) Active marketing
: Since dupes are almost always less well-known than originals, they usually incorporate aggressive marketing. For example, Derfriend’s essence gained much popularity after Li Jiaqi recommended the product in Taobao Live. Various activities on social media such as Xiao Hong Shu and frequent price discounts all contribute to providing benefits to consumers.
3) Home advantage
: Many dupes are from local brands. Chinese consumers love luxury overseas brands, but they also have great affection toward local names. Thus, if there is a dupe product with great quality that is equivalent to luxury brands, they actively consume the product from local brands.