SHISEIDO IN

CHINA
Marketing 2
Lecture: Le Hong Dac
 GROUP MEMBERS:
• Tran Nguyen Viet Ha _ 179011033
• Nguyen Ngoc Phuong Trang _ 179011035
• Le Pham Thanh Uyen _ 179011051
 CONTENTS:

• I. INTRODUCE ABOUT SHISEIDO COMPANY

• II. SUMMARY CASE STUDY
• III. ANSWER THE QUESTIONS
• IV. REFERENCE
I. INTRODUCE ABOUT
SHISEIDO COMPANY
 I. INTRODUCE ABOUT
SHISEIDO COMPANY
1.Foundin
Arinobu Fukuhara established the Shiseido
•g
Pharmacy in 1872.
• The name Shiseido derives from a Chinese
expression meaning "praise the virtues of the
earth which nurtures new life and brings forth
significant values".
• At that time, Japese relied on Chinese herbal
remedies ,not western drug
• 1878, the company started manufacturing its own
pharceutical product and later moved into
cosmetic
• Shiseido find to combine Western technology
with natural Asian ingredient
 I. INTRODUCE ABOUT
SHISEIDO COMPANY
1.Foundin
g• In 1917, Shiseido introduced Rainbow
Face Powder. This was a face powder
with seven colors in a period when white
face powders were the norm in Japan.
• In 1923, the company began expanding
its store-base; it now has approximately
25,000 outlets.
 I. INTRODUCE ABOUT SHISEIDO
COMPANY

•1872
•1916
•1928
•1974
•1987
•2019
 I. INTRODUCE ABOUT
SHISEIDO COMPANY
1.Foundin
g• A joint-stock company was formed in
1927.
• Their system also acted as an information
medium to tranmist the latest beauty
information, including knowledge about
skin care, fashion, and hairstyle trends to
Japanese women throughout the
country.
• In April 2014, Masahiko Uotani started
working as the first CEO of the company.
 I. INTRODUCE ABOU
SHISEIDO COMPANY
2. Logo
 I. INTRODUCE ABOUT
SHISEIDO COMPANY
3.
Products
• Shiseido provides a full range of products
including lip products, powder eye shadows,
eye liner pencils, mascara, fluid and
compact foundations, concealers, and
powder blush.
• Shiseido produced a full range of products
for men in the late 1920s to early 1930s.
 I. INTRODUCE ABOUT SHISEIDO
COMPANY
3.
Products
• Lip products
• Powder eye shadows
• Eye liner pencils
• Mascara
• Fluid and compact foundations
• Concealers
• Powder blush
• For men
 II. SUMMARY CASE STUDY
1. INTERNATIONAL EXPANSION
• In 1957, the company expanded oversea to taiwan
an then to Singapor, Hongkong, Haiwaii and Italy.
• In 1980, Shiseido entered Germany and move to UK
in 1986,selling through deparmental stores.
• In 1988, Shiseido entered the US hair salon market by
acquisition Zotos International.
• In1990, Carita S.A was bought by Shiseido, a
presstigiuos French beauty in PARIS and formed a
wholly owned subsidiary in France.
• In 2011, foreign sales accounted for 42.9% of
Shiseido’s total sales.
 II. SUMMARY CASE STUDY
2. Shiseido in CHINA
• In 1981, Shiseido was allowed by the Beijing government
to import its products from Japanese and sell them at
some tax-free departmental stores and hotel in Beijing.
• In 1983, Shiseido started manufacturing shampoos and
conditioner in China Under technology cooperation
agreement selling these toiletries under the brand name
HUA ZI.
• Thanks to a host of success of product, Shiseido became a
joint venture company in 1991 – Shiseido Liyuan
Cosmetucs Company (SLC).
• Shiseido and a local company Liyuan Corporation, a
state-owned enterprise associated with the Beijing
government.
 II. SUMMARY CASE STUDY
2. Shiseido in CHINA
• The SLC joint venture later decided to develop a cosmetic
brand just for Chinese consumers .A french-sounding
name AUPRES. Cosmetic, and skincare products were
priced high and targeted at the top one % of chinese
population. The Shiseido name was put in front, below the
Aupres name.The products were distributed only through
the Chinese departmental sotres.
• The brand was advertised mainly in magazines at the
initial stage but later, television advertising was used in
Beijing and Shanghai. These advertisement featured local
models.
• In contrast to Shiseido’s imported product that featured
foreign model.
 II. SUMMARY CASE STUDY
2. Shiseido in CHINA
• One of the main problems facing Shiseido in China is
product counterfeiting, which sometimes affects
wholesale counters in departmental stores.
• In 1998, Shiseido formed a manufacturing joint venture
with China International Trust and Investment Corporation
(CITIC) called Shanghai Zotos CITIC Cosmetics Company
(SZC).
• SZC produced medium-priced comestics brands sucs as
Za, Pure and Mild,…..
• In July 2003, Shiseido started selling its high-end toiletries
by importing them directly from Japanese through its Jap-
based subsidiary FT Shiseido Company Limited
• In Early 2011, Shiseido repositioned its CLE DE PEAU BEAUTE
brand and launched it in the JAP market
 II. SUMMARY CASE STUDY
3. Voluntary chain stores and other channels
• The sales of cosmetics in departmental stores in China had
been increasing. Shiseido decided to duplicate its successful
Japanese voluntary specialty chain stores concept in China
and engaged privately-managed cosmetics stores to sell its
products under the Chinese joint venture SLC. As the first step,
Shiseido opened a directly managed store—Huan Cai Kong
Jian in Shanghai in September 2003, which served as the model
for other privately-owned stores that would be engaged to sell
Shiseido's products.
• Huan means vigor, cai the means style, and kong jian means
space. The model stores would primarily carry eight brands
encompassing 223 items, including brands that are imported it
directly from Japan—such as Shiseido UV White and locally
produced brands such as WHITIA, Pure, Mild China, as well as
higher-end toiletries like AQUAIR and TESSERA. The first of these
stores selling only Aupres products, opened in a shopping
 II. SUMMARY CASE STUDY
3. Voluntary chain stores and other channels
• There were about 800 of these stores in August 2005,
1,700 stores in March 2007, and over 5,000 stores by
end March 2011. The aim is to expand points of
contact with new customers in addition to existing
sales channels in China.
• On September 15, 2010, Shiseido launched a website
for Pure and Mild, a new series of products
developed specifically for the Chinese mail-order
market under the Pure and Mild brand that is offered
primarily at supermarkets, hypermarkets, and
cosmetics specialty stores.
 II. SUMMARY CASE STUDY
3. Voluntary chain stores and other channels
• The new line of 14 products-ranging in price from RMB
90 to RMB 230 and incorporating environment-friendly
features that include packaging made from bagasse
paper-are targeted at young, post-1980s consumers
who prefer natural products.
• The mail-order business includes a new call center that
handles customer enquiries and an online counseling
service that allows professionally-trained call center
staff to propose products and beauty techniques that
are optimized for the skin types and needs of individual
customers.
 II. SUMMARY CASE STUDY
4. Competitors in China
• China is the world’s third largest cosmetic after the US and
JAP
• The size of Chinese cosmetic market was valued at
around RMB 101,200 MILLION in 2010 and was expected
to grow to RMB 112,000 MILLION in 2011.
• The market is expected to grow at a compound annual
growth rate of 12% during the 2011 to 2014.
• About 90 million urban women in China are willing to
spend about 10% of their income on beauty product.
• Lancome started a concept store in west najing road in
Shanghai 2005. Outfitted with sculpted sofas and light pink
wall the outlet gives the customer a feelitng of being in a
space station.
 II. SUMMARY CASE STUDY
4. Competitors in China
• The company wants to give a sense of luxury, and a feeling of
being away from the crowded departmental stores . It wants
affluent housewives and "white collar princesses" to shop for its
products in a discreet and comfortable setting
• L'Oreal—owner of the Lancome brand—had acquired Yue-Sai,
a woman's make-up brand and manufacturer founded by the
Chinese-American television celebrity Yue-Sai Kan and is based
in Shenzhen
• L'Oreal also opened a research and development facility in
Pudong, Shanghai, to under-brands. stand Chinese consumers
better
• Another competitor is Estee Lauder, which sells its to expand
Lauder, Clinique, La Mer, M.A.C., and Bobbi Brown on to exist-
brands in departmental stores throughout China. It has 50
counters for Lauder and Clinique, but, three counters each for
the other brands
 II. SUMMARY CASE STUDY
4. Competitors in China
• In 1993, La Mer's counter at the Isetan store in Shanghai
broke the record for first-day opening sales in China, even
though its products were priced high at US$245 and it
carried only three stock-keeping unit
• Procter & Gamble is another major player in the cosmetics
market in China , Its brand, Olay, was the fastest growing
brand in the mass market , The brand is distributed mainly
through supermarkets and hypermarkets
• AVON product, a major cosmetic manufacturer based in
the US was selling its product in 6300 boutiques and 1,600
counters in departmental stores when the ban in force
• The ban was lifted in 2005. In February 2006, Avon
obtained the license for door-to-door selling and struck
had recruited 350,000 sales representatives by the end of
2006
 II. SUMMARY CASE STUDY
4. Competitors in China
• While foreign manufacturers may appear to have an of
the upper hand in China's vast cosmetics market, local
competition cannot be ignored. For example, the home
brand Herborist—a state-owned company—has 180 bou
tiques in 40 cities in China
• The company managed to sell its products in a
departmental store for the first time in 2002. In the same
year, the company opened a Herborist Spa in Benuir .The
brand emphasized itsconnection with traditional Chinese
medicine and this had struck a chord with some Chinese
consumers
• The company opened its 100th outlet in 2005, and to 2010
it had 800 exclusive stores in 80 Chinese cities
 III. ANSWER THE
QUESTIONS
1. What are the functions performed by the marketing
and distribution channels for cosmetics products?
Which of these functions are most important? Why?
2. What is the marketing channel design in terms of
channel length, channel intensity, and channel
types adopted by Shiseido in China? What factors
influence its choice of the channel design and
strategy? What improvements would you make to
the channel design?
3. What retail strategy is adopted by Shiseido in
China? How is this strategy related to its
segmentation, targeting, and branding strategies?
 III. ANSWER THE
QUESTIONS
Question 1:
• Marketing channels make possible the flow of goods from
a producer, through intermediaries, to a buyer
• 3 function must be performed
Transaction
Logistical
Facilitating
• All 3 function must be performed in a marketing channel
• Distribution channels perform a transaction function that
involves buying, selling and risk taking
• . Performing a transactional function would involve
buying from the manufacturer selling to other
intermediaries, or intermediaries who sells to consumers
• Wholesalers performs the function of sharing risk with the
producer when it stocks the cosmetics products in
anticipation of sales.
• If the stock is unsold ???
the intermediary–not the producer– suffers the loss
Logistical
• Performed by distribution channels
• preparing and getting the cosmetics products to
buyers.
• to transport cosmetics products to either the next level
of distribution channel or directly to the customers
• also include assorting, which is creating product
assortments from several sources to serve customers or
reach a target market
Facilitating
• Function is the most important for cosmetics
products.
• Intermediaries help to make the cosmetics products
more attractive to customers
Salesperson actively promoting their cosmetic
products to customers
• This helps narrow down a consumer’s evaluative
criteria which they use to compare different
products and brands
• Facilitating function also includes grading of
cosmetics products through inspection and test
before assigning them quality grade.
• There are many other cosmetic counters located
near each other therefore it is important for
facilitating functions to help consumers make
choices and reach out to a larger market.
 III. ANSWER THE
QUESTIONS
1. What are the functions performed by the marketing
and distribution channels for cosmetics products?
Which of these functions are most important? Why?
2. What is the marketing channel design in terms of
channel length, channel intensity, and channel
types adopted by Shiseido in China? What factors
influence its choice of the channel design and
strategy? What improvements would you make to
the channel design?
3. What retail strategy is adopted by Shiseido in
China? How is this strategy related to its
segmentation, targeting, and branding strategies?
 III. ANSWER THE
QUESTIONS
Question 2:
 III. ANSWER THE
QUESTIONS
1. What are the functions performed by the
marketing and distribution channels for cosmetics
products? Which of these functions are most
important? Why?
2. What is the marketing channel design in terms of
channel length, channel intensity, and channel
types adopted by Shiseido in China? What factors
influence its choice of the channel design and
strategy? What improvements would you make to
the channel design?
3. What retail strategy is adopted by Shiseido in
China? How is this strategy related to its
segmentation, targeting, and branding strategies?
 III. ANSWER THE
QUESTIONS
Question 3:
• Using a multichannel retailing strategy through mail
order catalogues, retail stores, online, and via
mobile technology.
=> Shiseido gives each product a distinct name.
• Differentiate their brands according to price and
quality, targeting different customer group.
=> Using a variety of retail channels to cater each
group. Each brand is intended for a different
targeted market segment.
• Shiseido adopted 3 main types of retail channel.
 III. ANSWER THE
QUESTIONS
Question 3: Firstly
• Voluntary chain stores selling a wide range of
luxury and also middle level products.
• A specific group (usually small): the middle to
high income ladies.
• When Shiseido entered China in 1981, it
introduced a sub-brand called Aupres, and
position it as an elite brand.
• The special experience for their customers at
the specialty store.
 III. ANSWER THE
QUESTIONS
Question 3: Secondly
• Special sales corners in department stores
and at cosmetics speciality stores for middle
level products along with personal
counselling to customers.
• Group: the mid-income ladies and mass
market.
• Medium-priced cosmetic brands such as Za
and Pure Mid China.
• Beauty advisors will be there to assist
customers with the products.
 III. ANSWER THE
QUESTIONS
Question 3: Lastly
• Convenience and drug stores through which
it sells middle to mass market products by
launching self-cosmetics.
• Group: a large consumer group and mass
market.
• A new series of lower-priced products
developed specifically for the Chinese mail-
order mark under its Pure and Mild brand.
 III. ANSWER THE
QUESTIONS
Question 3: Lastly
• Launched the DQ brand, sold exclusively
through drugstores. DQ also carries a lower
price point than Shiseido’s key premium
brands.
=> The lower-income consumer segment.
• The new line of products, with environment-
friendly features that include packaging
made from bagasse paper.
=> Targets young, post-80s consumers who
prefer natural products.
 IV. REFERENCE
• https://en.wikipedia.org/wiki/Shiseido
• https://bicicosmetics.vn/gioi-thieu/
• https://www.arnoff.com/logistic-solutions/
• https://www.performancetrainingsolutions.com/blog/4-
tricks-to-facilitating-a-thrilling-meeting/
• http://www.liberaldictionary.com/facilitation/
• https://www.ancient-origins.net/history/bygone-beauty-
and-body-origins-cosmetics-ancient-world-005539
• https://blog.viecngay.vn/ky-nang-nhan-vien-giao-hang-
can-biet/
• https://mythoughtlane.com/2015/08/28/skin-
rejuvenatorsfight-pigmentation-and-acne-with-ahaglow-
and-tone-n-glo/
• https://www.shiseido.com.cn/index.php/top10.html
 IV. REFERENCE
• https://www.facebook.com/bicicosmetic/photos/pcb.2
312867638774199/2312924472101849/?type=3&theater
• https://www.shiseidogroup.com/ir/pdf/ir20111130_419.p
df
• https://ycharts.com/companies/SSDOY/machinery_furnit
ure_equipment_annual_per_share
• https://www.businessinsider.sg/shiseido-just-opened-its-
new-apac-headquarters-in-singapores-cbd-complete-
with-innovation-lab-training-facility-and-a-centre-for-
customers-with-serious-skin-concerns/
• https://www.shiseido.com/about-the-shiseido-
brand.html
• https://www.shiseido.com/customer-service.html
• https://www.shiseido.com.vn/vi/Storelocator
 IV. REFERENCE
• http://www.arogundade.com/sui-he-model-bio-ethnicity-
age-height.html
• https://www.google.com/search?rlz=1C1CHBF_enVN824V
N824&biw=1920&bih=882&tbm=isch&sa=1&ei=id6LXKOvFo
Pj-
AaSn6PgBg&q=shiseido+DQ+china&oq=shiseido+DQ+chin
a&gs_l=img.3...260274.260690..261249...0.0..0.298.593.2-
2......1....1..gws-wiz-img.-hoNBakmC0M
• https://www.google.com/search?q=shiseido+in+singapor
e&rlz=1C1CHBF_enVN824VN824&source=lnms&tbm=isch&
sa=X&ved=0ahUKEwjxsJza6ZLhAhVBdt4KHU_8A54Q_AUIDi
gB&biw=1920&bih=943#imgrc=aX7aXnz-Mxv9xM
• https://www.cosmeticsdesign-
asia.com/Article/2018/09/04/China-s-FDA-recalls-skin-
care-product-by-Shiseido-backed-manufacturer
• https://goo.gl/images/4MFVJN
 IV. REFERENCE
• https://goo.gl/images/eqFuKi
• https://goo.gl/images/cA5TZZ
• https://goo.gl/images/5UknYU
• http://www.loveretouch.com/gallery.php?series=305604
4
• https://www.shiseido.com/about-the-shiseido-
brand.html
• http://phonhonews.com/tim-hieu-ve-hoa-tra-camellia-
bach-viet/shiseido-logo/
• http://www.projectvanity.com/projectvanity/2015/3/25/
a-concealer-tutorial-a-review-the-shiseido-perfecting-
stick-concealer
• https://www.mimoa.eu/projects/Japan/Tokyo/Shiseido%
20Building/
IV. REFERENCE
IV. REFERENCE
 THE END
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