Du Xiaoyan, President of Internet Medical Aesthetics Branch of CAPA: The Era of Coarse Growth in Aesthetic Medicine Is Over; a Comprehensive Credit System Is the Future

The aesthetic medicine model, characterized by Baidu promotion and extensive expansion through traditional channels, has failed to keep pace with the times. The persistent challenges of marketing and labor costs facing all institutions have yet to be effectively resolved. However, leveraging internet technology has ushered in a new turning point for the development of the aesthetic medicine industry.

In 2015, the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics (hereinafter referred to as the “Internet Medical Aesthetics Branch”) was officially established. Leveraging internet-based tools, it strives to break through the current bottlenecks in the development of the medical aesthetics industry and is committed to promoting the industry’s transition toward a new, standardized path of development.

On April 27 this year, after months of solicitation and discussion, and incorporating enterprise standards from various sub-sectors as well as expert recommendations, the “Guidelines for Standardizing the Internet-Based Medical Aesthetics Industry (Draft)” issued by the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics (hereinafter referred to as the “Draft”) was officially released, thereby improving the internet-based information infrastructure development within China’s medical aesthetics industry.

As a highly market-oriented sector, what challenges does the medical aesthetics industry currently face, and how can the Internet Medical Aesthetics Branch empower its development? To address these questions, VCBeat (WeChat: vcbeat) conducted an exclusive interview with Du Xiaoyan, President of the Internet Medical Aesthetics Branch.

Du Xiaoyan, President of the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics

China has become the world’s second-largest consumer market for medical aesthetics, after the United States, with a market size exceeding RMB 220 billion and more than 18,000 aesthetic surgery institutions.

Since the 1990s, the medical aesthetics industry was once labeled as “exorbitantly profitable” due to low market entry barriers, limited competition, extensive operational models, and high profit margins. After more than a decade of golden, leapfrog development, characterized by an influx of capital and chain expansion of institutions, leading medical aesthetics brands have emerged, forming a monopolistic landscape.

Meanwhile, certain drawbacks have begun to emerge. The highly market-driven operational model has led aesthetic medicine institutions to overemphasize short-term gains, resulting in fierce competition and severe price wars. Coupled with persistently high costs for Baidu advertising and traditional customer acquisition channels, profit margins have gradually declined. While clinics and capital have expanded aggressively, the cultivation of professional talent and technological innovation have become new weak links.

“Initially, profit margins at plastic surgery hospitals could range from 15% to 45%; nowadays, achieving even a 10% margin is quite challenging. Large branded chains can still sustain themselves by leveraging their previously accumulated brand equity, customer base, and technical advantages. Smaller institutions generally have lower labor and marketing costs, relying primarily on word-of-mouth to serve local clients. In contrast, mid-sized institutions face significant survival challenges, with many quietly exiting the market,” revealed Du Xiaoyan.

More alarmingly, a large number of medical aesthetic accidents stem from the “three unregulated” sectors: unlicensed institutions, unqualified practitioners, and non-CFDA-approved products. These issues are rampant, compounded by the absence of standardized medical services and a deficient credit system, leading to severe doctor-patient conflicts.

“Data indicates that the ratio of licensed medical aesthetic institutions in China to illegal entities, such as unlicensed studios and beauty salons, stands at 1:10. Although the rise of the existing young consumer base suggests that the medical aesthetics industry is poised for a new surge in growth, it currently remains in a fiercely competitive ‘red ocean’ characterized by uneven quality, which is highly detrimental to the sector’s development. Cracking down on the ‘three illegals’ (illegal institutions, illegal practitioners, and illegal products) and standardizing the industry are urgent imperatives.”

At the operational level of medical aesthetics institutions, the substantial costs associated with marketing and physicians have significantly eroded profit margins, representing a widespread pain point in the industry. The emergence of internet-based and digital solutions has provided new avenues for addressing this challenge.

Against this broad industrial backdrop, the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics was officially established in 2015. It brings together cross-sector forces—including medical aesthetics experts, medical aesthetics institutions, internet companies and platforms, and medical investment and financing institutions—leveraging internet-based tools to break through the current bottlenecks in the development of the medical aesthetics industry and committed to driving the industry toward a new track of standardized and intelligent operations.

In 2017, the former National Health and Family Planning Commission officially defined medical aesthetics as an “industry-oriented” discipline. From a policy encouragement perspective, the highly marketized medical aesthetics industry began to reach a new turning point in its development, facing challenges related to structural adjustment and standardized growth. As a semi-official functional body of the medical aesthetics sector, the Chinese Association of Plastics and Aesthetics bears the responsibility of strengthening self-discipline and rights protection, establishing industry standards, assisting government health administrative departments in enhancing regulatory oversight, and promoting the standardization and规范化 development of the industry.

As for the establishment of the Internet Medical Aesthetics Branch, Du Xiaoyan believes that at the time of its founding, the internet medical aesthetics industry was already booming. Internet companies represented by SoYoung, Gengmei, Meibei, and Yuemei had emerged, with their value lying in empowering traditional medical aesthetic institutions by helping them expand revenue sources, increase traffic, and improve efficiency.

“Online internet companies and offline institutions have historically operated under two distinct business models. How to genuinely promote the integration of online and offline operations is the primary consideration for the Internet Medical Aesthetics Branch. The objectives are twofold: first, to expand the overall scale of the industry; second, to help institutions reduce costs. Ultimately, through online-offline integration, we aim to establish internet-related regulations and future standardization measures for the medical aesthetics industry,” stated Du Xiaoyan.

According to available information, the primary responsibilities of the Chinese Association of Plastics and Aesthetics are to establish norms and standards for each segment of the medical aesthetics industry’s supply chain, while also providing oversight and guidance. “We do not possess administrative authority to issue orders or impose penalties; however, the Association holds the rights to provide guidance, offer recommendations, conduct supervision, and give feedback.”

In Du Xiaoyan’s view, the medical aesthetics industry remains underdeveloped in terms of its service pathways and processes, spanning from physicians and institutions to overall service delivery. Illegal practices that disrupt market order also persist. The immediate priority is to establish clear “rules of the game” for the industry. “We need industry-wide standards. What our branch aims to do is to develop authoritative standardization frameworks and normative models for industrial development across the four key segments of the internet-based medical aesthetics value chain: institutions, physicians, products, and patients. This is an essential prerequisite for the industry’s sustained forward progress.”

In February and March of this year, the preliminary framework for the standards was drafted. On April 27, the “Guidelines for Standardizing the Internet Medical Aesthetics Industry (Draft)” issued by the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics (hereinafter referred to as the “Draft”) was officially released. The Draft covers areas closely related to the internet, including information technology infrastructure construction in medical institutions, third-party medical aesthetics platforms, verification and public disclosure of qualifications for medical institutions and physicians, medical advertising, and medical education.

The introduction of this Draft refines standards for China’s medical aesthetics industry in areas such as internet-based information infrastructure, smart medical aesthetics, big data applications, and online media promotion. It enhances enforceability in strengthening cybersecurity, preventing and mitigating medical risks, safeguarding patient privacy, and regulating online promotional language, with further improvements and optimizations to be implemented in the future. “This is a comprehensive system with highly detailed provisions at each stage, which will continue to be refined in the future.”

“After the promulgation of the Draft, it sparked significant attention among industry peers. Industrial partners such as Fosun and Meituan began discussing collaborative efforts to explore the feasibility of building health insurance products and a consumer evaluation system. We aim to establish standardized frameworks and operational models at each node of the industry chain, thereby providing endorsement for future reward and punishment mechanisms, and ultimately constructing a genuine credit system for the medical aesthetics industry.”

Du Xiaoyan stated that, in addition to strengthening standardized oversight, the branch will accelerate the implementation of big data applications and informatization initiatives such as “Electronic Medical Records + Insurance,” continuously advance the development of a trusted internet ecosystem, encourage innovation and integrated development, and enhance the efficiency of hospital management and medical services.

From the perspective of the broader healthcare industry, on April 25, the State Council issued the “Opinions of the General Office of the State Council on Promoting the Development of ‘Internet + Healthcare’” (Guo Ban Fa [2018] No. 26). Article 9 of Section II of these Opinions requires: establishing a sound standard system for “Internet + Healthcare.” Through information technology infrastructure development, interoperability can be achieved, reducing costs and improving efficiency for healthcare institutions, while enabling patients to access medical services more efficiently and conveniently. This trend is irreversible.

The reporter learned that the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics is currently conducting evaluations of institutional maturity in the medical aesthetics industry. “We have surveyed and assessed the extent to which each institution has developed its customer management system, internal operations system, marketing system, and information technology infrastructure related to internet-based services, and our next steps are being actively advanced.”

Looking at the entire medical aesthetics industry, the upstream sector of devices and consumables continues to deliver substantial profits, representing a relatively standardized ecosystem. Du Xiaoyan believes, “Upstream biotechnology is undoubtedly a key driver propelling the industry forward. Future growth in the medical aesthetics sector will be endogenous, stemming from areas such as regenerative medicine—including stem cell therapies and anti-aging treatments. Patients are increasingly inclined toward conditioning approaches and minimally invasive device-based treatments to achieve skin and body rejuvenation, rather than undergoing direct surgical plastic surgery.”

Downstream medical aesthetic institutions are currently in a transitional phase of transformation and upgrading. Information technology platforms at the midstream level have introduced new variables to industry development. “Currently, there are no industry standards for pre-operative, intra-operative, and post-operative image acquisition or the retention of electronic medical records. In the future, we hope to have standardized products for image data collection. This will serve as valuable evidentiary support for institutions, physicians, and patients in the event of subsequent disputes, while also driving the development of the insurance industry.” Medical aesthetic insurance and finance, which are still in their nascent stages, are expected to unleash significant potential once the credit reporting system is established.

“The doctor-patient conflicts in the medical aesthetics industry are, at their core, a crisis of trust. Only with robust mechanisms for supervision, feedback, and reporting can patients enjoy greater safety assurances, which in turn drives the expansion of the industry’s scale. However, this will undoubtedly be a long-term process.”

Regarding the future plans for the branch, Du Xiaoyan told reporters, “We are sparing no effort to develop standardized guidelines. This is a massive undertaking. Once these standards are established and a genuine credit reporting system is put in place, it will mark a qualitative milestone for the industry.”

In this process, the Internet Medical Aesthetics Branch of the Chinese Association of Plastics and Aesthetics is willing to collaborate with cross-industry brand institutions to deeply cultivate the medical aesthetics industry, paving the way for future planning and development through system construction and top-level design.