Shiseido targets India’s masstige as it looks to expand

24-Jul-2013 - Last updated on 24-Jul-2013 at 14:26 GMT

Shiseido will be hoping Za's Lip Drops are a success in India

Japanese cosmetics maker Shiseido has turned its attention to India’s middle class masstige market having established a wholly-owned subsidiary, Shiseido India Private, in Mumbai.

To date, Shiseido has focused marketing efforts toward India's prestige segment, but with masstige forecast to grow significantly in the coming years, as well as being estimated as a market eight times larger than prestige; Shiseido is turning its attention here.

Shiseido's initial entry into the segment will target the ‘upper masstige’ bracket with its skin care and make-up brand Za which is currently offered in 12 markets in the Asia/Oceania region.

Brand focus

Present in Asian markets since 1997, the brand was launched in Japan in September 2012 and expanded into the Philippines in June 2013 where it is posting positive sales, thus the decision to position Za toward the relatively high-priced segment within the masstige market in India.

With optimistic forecasts for long-term growth, the line is expected to bow in April 2014 with plans to be offered in 250 doors by the end of 2014, 650 doors in 2015, and expansion plans in place to reach over 1,700 doors by 2018.

Shiseido says that products will be imported into the market after being manufactured primarily at the company’s Vietnam Factory, which serves the ASEAN and Japanese markets and is due for expansion later this year, to maximize production and transportation cost efficiency.

Research

The move has been a long time coming, and has been planned over the last few years, based on extensive research carried out by Shiseido in India.

To strategically expand its presence and better serve the profile of the local market, the Tokyo-based firm established its representative office in Mumbai in 2011, carrying out marketing surveys and research into consumer habits and preferences.

As a result of these insights, Shiseido decided to continue the current operational structure with Baccarose acting as distributor and operator of the global Shiseido brand and BPI fragrances in the prestige segment, while the newly established subsidiary will commence operations toward the masstige segment, which is expected to deliver greater growth.