March 4, 2017 6:00 am JST

Shiseido woos Chinese women with made-in-Japan cosmetics

Makeup behemoth eyes quintupling sales of brand

WATARU KODAKA, Nikkei staff writer

Shiseido will harness star power in its reboot of its Elixir brand in China.

SHANGHAI -- Cosmetics giant Shiseido is upgrading its Elixir skin care brand in China in an effort to appeal to the country's growing middle class.

Production has been shifted from Vietnam to Japan. Having seen Chinese tourists spending big on domestically produced makeup in Japan, Shiseido will advertise that Elixir products are made in Japan in the hopes of charming consumers here.

Half of the Elixir lineup of 50-60 items in China will get updates. Shiseido will also open 10 directly run shops in the coastal cities of Shanghai, Guangzhou and Shenzhen in fiscal 2017, with the sites featuring a luxury feel. The company aims to quintuple Elixir sales in China by 2020, Kentaro Fujiwara, head of the local operation, said Friday as the company announced the brand renewal in Shanghai. Updated Elixir products are for "Chinese women seeking moist and clear skin," Fujiwara said. Store openings are planned for Beijing and inland cities in 2018 and beyond.

Shiseido will target the country's upper-middle class -- or consumers in households with disposable income of at least 140,000 yuan ($20,272). Upgraded products will likely carry price tags about 30% higher than in Japan, with toners selling for 300 yuan to 500 yuan apiece.

Shiseido is also overhauling online marketing as it seeks to reach younger consumers, and has tapped Ruby Lin, an actress from Taiwan who is also popular in the mainland, as the face of a new campaign. The company launched a page inside Alibaba's Tmall shopping website Friday. "We're using locally suited marketing so that consumers here will get to know the brand that's a success in Japan," President Masahiko Uotani said.

Shiseido has faced a slowdown in China of late and is working to revamp the operations, weeding out weak sales channels and making over brands exclusively available here.

Shiseido Co., Ltd.

Japan

Market(Ticker): TKS(4911)
Sector:
Industry:
Consumer Non-Durables
Household/Personal Care
Market cap(USD): 13,802.24M
Shares: 400M

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