August 1, 2017 5:59 am JST

Shiseido to apply luxury Nars cosmetics line in China

Company expects brand will help boost country sales by 14%

MOTOKAZU MATSUI, Nikkei staff writer

Nars' mainstay is makeup with rich color variation.

TOKYO -- Japanese cosmetics maker Shiseido will release its high-end Nars brand in China to attract new customers as the country's income levels rise.

Nars, founded by makeup artist Francois Nars, became a Shiseido subsidiary in 2000. The brand mainly sells in department stores throughout roughly 30 countries and territories including the Americas, Europe, Japan and Southeast Asia. Nars also is sold in Hong Kong, its only market in China.

Shiseido will begin online sales through WeShop, a popular Chinese e-commerce site, at the end of August and plans to launch a Nars store in Shanghai's Raffles City shopping center in September.

The upmarket brand will sell foundation, lipstick, eyeliner and other products for around 350 yuan ($52).

Shiseido also markets luxury cosmetics from its eponymous brand as well as Ipsa, Cle de Peau Beaute and other labels, but these products are focused on skin care. The company thinks the colorful pallet of Nars can attract millennial consumers who value unique products.

The popularity of makeup and perfume in China is climbing along with income levels. Shiseido also is considering a release of Dolce & Gabbana makeup and perfume in China after acquiring production and sales rights last year.

Shiseido's Chinese operations logged 120.5 billion yen ($1.09 billion) in sales for the year ended in December, advancing 11.4% on a local currency basis. By brand, sales still depended heavily on Aupres, but pricier labels such as Cle de Peau Beaute saw growth. The Chinese unit turned an operating profit of 4.2 billion yen after a 500 million yen operating loss the previous year.

For 2017, Shiseido predicts Chinese sales will improve 14% on a local currency basis thanks to momentum from the Nars launch.

Shiseido Co., Ltd.

Japan

Market(Ticker): TKS(4911)
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Consumer Non-Durables
Household/Personal Care
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