SK-II China slump: Consumer research leaves P&G hopeful that luxury brand will recover by H2
Consumer goods giant Procter & Gamble (P&G) reported that SK-II sales fell by 34% in the Greater China region, including domestic travel retail, during its latest quarter ending December 2023.
This was attributed to safety concerns due to Tokyo’s decision to release treated radioactive water into the Pacific Ocean last year. It also triggered a backlash and prompted Chinese consumers to boycott Japanese goods, including beauty and personal care products.
However, P&G’s latest consumer research has been more positive.
“The SK-II sentiment is improving... And we are continuing to drive innovation, equity investment, and really relying on our most loyal and passionate user base to help amplify that messaging, which is working well. So, we expect the effects to improve year over year, quarter over quarter,” said Andre Schulten, chief financial officer, P&G.
Estée Lauder teases ‘extraordinary aggressive plans’ to capture luxury opportunity in China
The Estée Lauder Companies’ chief executive Fabrizio Freda expressed his excitement over the opportunity in China’s luxury beauty market during the firm’s latest earnings conference.
He highlighted the strong performance of its prestige brands on Douyin during the Double 11 Mega Shopping Festival, which helped to offset the decline on Tmall.
To capitalise on the opportunities in China’s luxury market, the company will leverage some of its most iconic brands.
“La Mer, Tom Ford, Le Labo, Bobbi Brown have extraordinary aggressive plans,” Freda declared.
‘Not like the others’: Will Documents be the C-beauty brand that finally achieves global success?
USHOPAL, a leading luxury beauty and retail group in China, recently announced that it has invested an undisclosed amount in high-end fragrance brand Documents.
Since launching in 2021, the brand has expanded from fragrance to body care and home care. It has also expanded into jewellery and fashion.
USHOPAL founder and chief executive Guo Lu said, “China has produced brands capable of stepping onto the global stage. Documents is one of the very few Chinese brands that can compete with global high-end brands in these aspects.”
Amorepacific FY2023: Growth Japan, Americas, EMEA not enough to offset China decline
Amorepacific’s latest full-year results show that growth across multiple markets, including the US, were not enough to offset the slump in China, leaving its overseas business unit in the red.
On January 30, the South Korean beauty conglomerate revealed a significant operating profit loss in its overseas business unit in its 2023 financial year report.
The company reported an operating profit loss of KRW43.2bn (USD32.5m) while revenue decreased by 6% overall to KRW1.39tn (USD1.04bn). The declines were mainly attributed to China, where revenues reported a decline of “mid-20%”.
Its latest fourth-quarter report showed that China revenues dropped by a whopping 40%.
Sa Sa observes ‘swing’ towards brick-and-mortar retail as online sales dip by 5.6% in HK and Macau
Beauty retail chain Sa Sa has reported that online sales in Hong Kong and Macau fell by 5.6% while offline sales grew by 44.3%, signalling the firm to advance its brick-and-mortar expansion.
According to its third-quarter financial report published on January 10, the company said the year-on-year decrease in online sales “reflects a marginal swing” towards offline sales following the end of COVID-19 measures.
According to the company, store sales have recovered to 46.9% of pre-pandemic levels. This is despite the fact that it now operates 36 fewer stores, a decrease of 30.5%, in the Hong Kong and Macau areas.