1 – Shiseido shedding assets: Why focus on high-end skin care will strengthen company’s long-term position – Experts
Japanese beauty group Shiseido’s decision to sell off three more brands in bid to focus on high-end skin care as its core category was a ‘no-brainer’, with beauty experts saying it was a smart decision to strengthen the company’s position in uncertain times.
Shiseido announced on August 26 that it will sell three of its prestige US-based make-up brands – Laura Mercier, BareMinerals and BUXOM – to private equity firm Advent International for U$700 million.
Shiseido cited its strategy to focus on its luxury skin care as the reason for shedding the trio of brands – the same reasoning it gave in February when it decided to sell off its personal care business to CVC Capital Partners.
“It’s a no brainer for them. COVID has hit most companies quite hard. Most consumers have cut back on using make-up, and that is a global trend, not just a trend in Asia,” Nicole Fall, founder of Asian Consumer Intelligence.
2 – ‘Very optimistic’: Estée Lauder CEO expecting double-digit growth for China in 2022
Estée Lauder Companies CEO has remarked on the strength of China’s beauty market, and said he was expecting it to grow by double-digits next year on the back of the acceleration of its online business.
According to Estée Lauder’s fourth-quarter earnings, the Asia Pacific region saw annual sales growth accelerated from 18% to 22%. This was led by China where net sales rose strong double-digits – a feat which its CEO believes it can replicate.
“We expect the market in China to continue to grow double-digit, and we are very, very optimistic on the strength of this market, as well as on our position with the consumers in this market. We expect to see a continuous acceleration of online, which is already 50% of Mainland China business today and further growing,” said Fabrizio Freda, who also serves as president and director of the multinational.
The growth in China was led by the continued strength of skin care, the acceleration of fragrance growth, and the recovery of makeup. Sales also benefited from key shopping events, including the 11.11 and 6.18 Shopping Festivals.
3 – Channel shift: L’Occitane’s records brick-and-mortar recovery as online sales slide
Hong Kong-listed L’Occitane saw a resurgence in brick-and-mortar retail channels with sales growing 67.6% in the first quarter of its 2022 fiscal year, with online channels dipping by 15%. However, the firm’s online sales still accounted for more than one-third of overall sales at 34.8%.
L’Occitane International is the manufacturer of beauty and well-being products with brands such as L’OCCITANE en Provence, Melvita, Erborian, and ELEMIS under its banner.
The company saw its physical retail channels improve in the first quarter, growing 67.6%. It recorded same store sales growth of 25%. It saw growth despite having 56 fewer stores as compared to the same period last year.
At the peak of the COVID-19 pandemic, the company closed more than 75% of its brick-and-mortar store network.
4 – Fast beauty in India: Bewakoof CEO expects new brand to net $13m in 18 months
India-based fast fashion company Bewakoof has launched a beauty brand that its CEO expects to achieve U$13m in sales in the next year and a half.
Bewakoof is a direct-to-consumer (D2C) fast fashion brand founded in 2012. The company has amassed a consumer base of four million and has a top line figure of close to U$45m in sales
The company recently launched Cosmos Beauty to tap into the opportunities in the fast-growing beauty market in India.
Targeted and millennials and Gen Z consumers, Cosmos Beauty is a gender-neutral brand developed with plant and mineral ingredients.
5 – ‘Another strong year’: P&G reports net sales rise for fiscal 2021, announces executive shuffle
Personal care giant Procter & Gamble (P&G) has reported a net sales rise for its fourth quarter (Q4) and full fiscal year of 2021, also unveiling a CEO and COO change designed to continue future growth in years to come.
Last week, P&G announced net sales of €15.8bn ($18.9bn) for Q4 fiscal 2021, up 7% on the previous year, largely driven by “disproportionate growth” in health care and the skin and personal care category. Net sales for Q4 were up 18% overall in health care; up 11% in beauty; up 10% in grooming; up 5% in fabric and home care; and up 1% in baby, feminine and family care.
For the full 2021 fiscal year, net sales came in at €64bn ($76.1bn), also up 7% on the previous year. Health care and fabric and home care both saw net sales rise 10% for the full year; net sales rose 8% in beauty, 6% in grooming and 3% in baby, feminine and family care.
Globally, organic sales were up for the year across the company’s “largest and most profitable” markets – Greater China (+12%) and the US (+8%). E-commerce sales across the entire P&G business were also up 35%.