Malaysia’s stable economy and mature cosmetics sector make it one of the most developed prestige markets in South East Asia. According to Euromonitor, the mass and prestige segments combined saw sales of $1.82 billion in 2012 and are forecast to grow 5.9% in 2013, with the strongest increases in skincare, which represents the lion’s share of the beauty market. Industry players predict mid single-digit growth in the years to come.

Last year, prestige beauty sales grew by around 5.5%, said managing director of distributor Luxasia Malaysia, Tze May Chung. While skincare accounts for the majority of the market, fragrance is also dynamic and extremely diverse, Luxasia’s Tze explained, mirroring the multi-ethnic Malaysian population.

“Chinese consumers tend to like lighter fragrances, while Muslims go for heavier, stronger scents,” she said. “Because we have a big Muslim culture, fragrance figures in a big way. Wedding sets and giving fragrances as gifts is popular year-round,” she added, saying that for many brands Luxasia represents this means creating gift sets for the local market.

Paul Slavin, managing director of The Estée Lauder Companies Malaysia, said, “Innovative skincare, particularly whitening and anti-aging lines, continue to perform very well, along with serums. In make-up, foundation is the biggest category and is seeing strong growth.”

The country’s general election, which took place in May after having been delayed since last year, provoked temporary uncertainty and affected consumer sentiment in the first quarter with premium beauty retail slowing significantly in the first three months of the year.

To read BW Confidential’s full report on Malaysia go click here.