700 hair salons in 2010
Shiseido is commencing sales of professional hair products in Shanghai and Beijing via its wholly owned subsidiary, Shiseido China Co. The Japanese cosmetics giant is proposing two brands to China’s hair salons: the Shiseido Professional brand, which is currently marketed by Shiseido in Japan, Asia and Oceania; and the Joico brand, which is marketed by Shiseido’s wholly owned subsidiary, Zotos International, in the United States.
Shiseido is aiming for approximately 700 hair salons for these products in the two cities of Shanghai and Beijing by the end of 2010 and plans to expand to 2,500 hair salons by 2014.
Second pillar for growth in China
Shiseido is considering the professional business as the second pillar of its growth in China, after cosmetics. The company - which aims to increase its international operations to 50% of its turnover by 2017, against 35% currently - wants to become “a global player representing Asia with its origins in Japan. China is obviously a key marketplace for the success of this strategy, and Shiseido is working to strengthen its China business by targeting an average annual growth rate of 20%.
The cosmetics market in China is anticipated to reach about 200 million cosmetics users in 2015, from 100 million in 2010. Needs are expected to increase simultaneously, further accompanying the desire to make oneself look more beautiful in all aspects from skincare and makeup to hairstyles.
Earlier in March, Shiseido has launched its new DQ brand in drugstores in China as a “third sales channels” after department stores and cosmetics specialty stores and is aiming 600 outlets for the brand in 2010.
Shiseido now intends to tap into professional hair segment and to establish a solid presence in high-end and luxury hair salons. The Japanese company will promote its research on Asian hair and also intends to disseminate information of hairstyle trends originating from Tokyo and as well as training programs for hair stylists.
The professional segment accounted for 7% of Shiseido’s overall sales in Japan and overseas in the fiscal year ended March 2009, which is second in size after the cosmetics business.
One million hair salons
According to Shiseido, the market for professional hair products in China was estimated to JPY 90 billion (EUR 725 million / USD 972 million) in 2007 with one million salons, and the segment is maintaining an average annual sales growth of 10%, which is roughly on par with the cosmetics market.
Shiseido claims to place emphasis on the steady development of brands rather than on rapid salon expansion. In order to providing training and educational programs to hair stylists, the company has established Shiseido Beauty Studios in Shanghai and Beijing in November 2009. The studios offer Shiseido’s original hair stylist training program, including education on hair-related theories and a follow-up of basic techniques, while also aiming to strengthen hairstyle proposal capabilities as well as to develop the spirit of Japanese omotenashi (hospitality).
