The love of beauty is universal, and it is etched in everyone's DNA. With the advent of cosmetics, beauty becomes accessible. Every year, beauty brands create a number of classics and trends, and their profits have long been known, but after 2021, the development of the beauty industry seems to have been pressed the pause button.

Affected by the epidemic environment, people's willingness to consume is gradually declining and their willingness to save is gradually increasing. Naturally, beauty products, as non-essential commodities, are also affected. Perfect Diary, as the dominant Chinese cosmetics industry, has had to tighten its belt in recent years. But even so, the beauty company, which has gone public in the United States, is still not faring well.

Perfect Diary previously announced the new five-year strategic transformation plan, including the optimization of business structure, control of operating expenses and other measures. It also talks about upgrading products and brands to improve sustainable profitability. But looking back at Perfect Diary's investment in research and development, many in the industry are noncommittory about the new five-year transformation plan.

Data showed that Perfect Diary's research and development expenses amounted to about 33.9 million yuan in the third quarter, accounting for 3.9 percent, up from 2.7 percent in the same period last year. By the end of the third quarter, the total RD investment of Perfect Diary in 2022 had exceeded 100 million yuan. Can perfect diary technology precipitation, there is still a large gap.

According to Aiqiza, as of January 2023, the group has only 54 patents, of which 53 are new appearance models and only 1 is utility models, and there is no patent information related to cosmetics technology.

On the other hand, L 'Oreal Group's patent achievements in the past ten years: the number of patents applied annually is nearly 500, and the number of new products each year accounts for 15%-20% of the whole product. In addition, it has three research and development centers and 16 evaluation centers around the world, with 3,862 RD personnel and an annual RD investment of 850 million euros.

The results of Perfect Diary's long focus on marketing at the expense of research and development are already starting to be reflected in the group's revenues. And after the listing of all financial data need to be true, detailed disclosure, which is no confidence for the perfect diary, it is worse. In a short period of research and development investment is difficult to see results, I am afraid the perfect diary will encounter many challenges.

When Perfect Diary became popular in the beauty industry, it gained the recognition of the market and capital. However, its overly single product line and the same marketing techniques have made consumers feel less fresh. Although it has been trying to adjust its pace and diversify in recent years, it has been unable to continue to expand through mergers and acquisitions when its research and development capacity is insufficient and its cash flow is too slow.

But the dilemma of perfect diary, can not be solved overnight, I am afraid in the future to carry forward for a period of time.