China. Beauty is back online
Despite the coronavirus crisis, which caused cosmetics sales to fall by 80% in February 2020, international retailers are betting on the Chinese online beauty market. On Alibaba‘s “Tmall Luxury Pavilion” platform, the luxury beauty section reported the strongest growth in May, with up to 200% growth on average per brand. Sales were boosted by the 520-festival celebrating Chinese Valentine’s Day. Yves Saint Laurent (No. 6 favourite make-up brand in China in 2019 according to Kantar) sold more than 100,000 lipsticks in 2 weeks, and sales of La Mer, luxury skincare, increased eightfold. Retailers who previously regarded web events on Alibaba or JD.com as an incremental source of growth now see these as essential for new revenue. For the French group L’Oréal (32% of sales in Asia in 2019), and well-established with 23 of its brands in China, the impact of the health crisis remains short-term. Fabrice Megarbane, C.E.O. of L’Oréal China, sees various development opportunities in the country, thanks to an increase in online traffic during the lockdown period and L’Oréal’s ability to offer a successful virtual customer experience.