COVID-19, a “Black Swan” Event for Cosmetic Market: Evidence from United Kingdom

Document Type : Research Note

Authors

1 Department of Business Administration, Faculty of Business and Economics, Near East University, Nicosia, Cyprus

2 Department of Business Administration, Amin Institute of Higher Education, Isfahan, Iran

Abstract

Since early this year, the world has been facing a hazardous new generation of coronavirus named COVID-19 which has rapidly spread to the extent that it has drowned the world into the pandemic condition. The spread of this pandemic has generated a strong contagion effect across markets around the globe. Therefore, it is necessary to examine the impact of COVID-19 for as many markets as possible. This paper aims to analyze the cosmetic retail market’s behavior in the time of the COVID-19 pandemic using a combination of graphical statistics tools to observe the monthly growth of production and sales in cosmetic retail and toilet articles for the period from October 2019 to August 2020. The results assume that the COVID-19 can have a black swan effect on the cosmetic micro-market. These findings are remarkable for the cosmetic sector's investors and marketers to enhance their understanding of cosmetic retail market behavior during unpredictable events such as pandemics.

Keywords

Main Subjects


Au, A. K. M., Ramasamy, B., & Yeung, M. C. H. (2005). The effects of SARS on the Hong Kong tourism industry: An empirical evaluation. Asia Pacific Journal of Tourism Research10(1), 85–95.
Baker, S. R., Bloom, N., Davis, S. J., Kost, K., Sammon, M., & Viratyosin, T. (2020). The unprecedented stock market reaction to COVID-19. The Review of Asset Pricing Studies10(4), 742–758.
Beutels, P., Jia, N., Zhou, Q.-Y., Smith, R., Cao, W.-C., & de Vlas, S. J. (2009). The economic impact of SARS in Beijing, China. Tropical Medicine & International Health: TM & IH14 Suppl 1, 85–91.
Bloom, D. E., & Cadarette, D. (2019). Infectious Disease Threats in the twenty-first century: Strengthening the global response. Frontiers in Immunology10, 549.
Castles, F. G. (2010). Black swans and elephants on the move: the impact of emergencies on the welfare state. Journal of European Social Policy20(2), 91–101.
Cosmetic industry growth. (n.d.). Statista.Com. Retrieved December 26, 2020, from https://www.statista.com/statistics/297070/growth-rate-of-the-global-cosmetics-market/
Fan, V. Y., Jamison, D. T., & Summers, L. H. (2018). Pandemic risk: how large are the expected losses? Bulletin of the World Health Organization96(2), 129–134.
Fernandes, N. (2020). Economic effects of Coronavirus outbreak (COVID-19) on the world economy. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3557504
Haacker, M. (2004). The impact of HIV/AIDS on government finance and public services.
Haider, N., Yavlinsky, A., Simons, D., Osman, A. Y., Ntoumi, F., Zumla, A., & Kock, R. (2020). Passengers’ destinations from China: low risk of Novel Coronavirus (2019-nCoV) transmission into Africa and South America. Epidemiology and Infection148(e41), e41.
Heinonen, S. (2013). The dance of the black swans. Publications of the Finnish Parliament’s Committee for the Future5, 20–40.
Henderson, J. C., & Ng, A. (2004). Responding to crisis: severe acute respiratory syndrome (SARS) and hotels in Singapore. International Journal of Tourism Research6(6), 411–419.
Hoffman, S. J., & Silverberg, S. L. (2018). Delays in global disease outbreak responses: Lessons from H1N1, Ebola, and Zika. American Journal of Public Health108(3), 329–333.
Jiang, Y., & Wen, J. (2020). Effects of COVID-19 on hotel marketing and management: a perspective article. International Journal of Contemporary Hospitality Management32(8), 2563–2573.
Kandel, N., Chungong, S., Omaar, A., & Xing, J. (2020). Health security capacities in the context of COVID-19 outbreak: an analysis of International Health Regulations annual report data from 182 countries. Lancet395(10229), 1047–1053.
Keogh-Brown, M. R., & Smith, R. D. (2008). The economic impact of SARS: how does the reality match the predictions? Health Policy (Amsterdam, Netherlands)88(1), 110–120.
Krupa, J., & Jones, C. (2013). Black Swan Theory: Applications to energy market histories and technologies. Energy Strategy Reviews1(4), 286–290.
Lee, C.-C., & Chen, C.-J. (2011). The reaction of elderly Asian tourists to avian influenza and SARS. Tourism Management32(6), 1421–1422.
Nakamura, H., & Managi, S. (2020). Airport risk of importation and exportation of the COVID-19 pandemic. Transport Policy96, 40–47.
retail - Search - Office for National Statistics. (n.d.). Gov.Uk. Retrieved December 26, 2020, from https://www.ons.gov.uk/search?q=retail
Taleb, N. N. (2007). Black swans and the domains of statistics. The American Statistician61(3), 198–200.
Topic: Cosmetics market in the United Kingdom (UK). (n.d.). Statista.Com. Retrieved December 26, 2020, from https://www.statista.com/topics/5760/cosmetics-market-in-the-united-kingdomuk/
WHO Director-General’s opening remarks at the media briefing on COVID-19 - 20 March 2020. (n.d.). Who.Int. Retrieved December 26, 2020, from https://www.who.int/director-general/speeches/detail/who-director-general-s-opening-remarks-at-the-media-briefing-on-covid-19---20-march-2020
World Health Organization. (2020). Coronavirus disease 2019 (‎COVID-19)‎: situation report, 43. https://apps.who.int/iris/handle/10665/331354
Yarovaya, L., Matkovskyy, R., & Jalan, A. (2020). The effects of a “black swan” event (COVID-19) on herding behavior in cryptocurrency markets: Evidence from cryptocurrency USD, EUR, JPY and KRW markets. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.3586511