Increasing purchasing power and disposable income, urbanization, growing awareness about beauty products, and manufacturers aggressively pushing products in rural India are driving the volume sales of cosmetic products robustly.

Affordability and a rising consumer base in the country are also responsible for high cosmetic sales in the cosmetics and beauty sector, there have been sweeping changes. Expensive international beauty products are selling rapidly as Indian women are investing in their long-term beauty. The biggest beauty evolution in India's recent past, however, is not restricted to women. Men have taken to a healthier skin routine away from the gym. The rise in men's salons is evidence of the fact that men want more beauty for themselves. The menu cards on offer at men's salons include treatments that were earlier meant for women. Men's salons have now started offering a multitude of beauty services, while beauty brands now have a special product line-up dedicated specifically to men's grooming.

According to a recently published report by Bonafide Research, "India Cosmetic Market Outlook, 2027-28", the cosmetic market in India has been growing with a CAGR of nearly 9% over the past few years. The urban population with increasing purchasing power is the major force driving demand for cosmetic products. India is a very price-sensitive market, and mass-market products constitute the major part of the cosmetics market. Urban India leads the market, with more than four-fifth of the cosmetics segment consumption by volume. However, rural consumption of toilet soaps exceeds urban consumption and is nearly equal to urban sales of hair oil, the lowest end of the hair care market.

As per ASSOCHAM (Associated Chambers of Commerce and Industry of India), the per capita consumption of cosmetics in India is approximately US$ 0.68 cents, as compared to US$0.40 in Hong Kong, US$ 12 in Japan, and US$ 1.5 in China. Consumption of these products centres on young women, with the age group 15–44 years accounting for about 70% of the market. Consumption begins in the teens and tapers off after 45, and declines substantially after 55.

Many domestic and international companies are now targeting the rural markets to push volume sales in categories like lip and nail care, and some mass skin care products as well. Meanwhile, urban consumption is evolving, moving from basic functional to more superior and specialised products and greater expenditure levels. Moreover, there is a rise in consumption of men’s products, including skin care products, which were earlier considered purely a woman’s sphere. The dominant international players include Hindustan Unilever, the subsidiary of Unilever with all its international and Indian brands; L’Oreal, along with its subsidiary Maybelline and Garnier brands; Revlon; Nivea; Biersdorf, Schwarzkopf, and Palmolive; and Proctor & Gamble, including Gillette.

Lakme as a brand dominates the cosmetic industry in India and is owned by Unilever. Stiff competition has resulted in an increase in the range of new products being introduced for newer application concepts in the last few years. In the skin-care segment, from just creams and moisturizers, there has been an upgrade to value-added products such as under-eye wrinkle removing creams, dark circle removing creams, toners, sunscreen lotions, fairness creams, and many more. The colour cosmetics market saw new products such as smudge-proof lipsticks and mascaras, liquid lip colours, and long-lasting lipsticks being introduced. However, low and medium-priced categories account for almost 85–90% of the cosmetics market in terms of volume.