NEW DELHI — Shiseido has raised its flag in India.
The Tokyo-based company has orchestrated its first launch, Za cosmetics, in the country, under the auspices of Shiseido India Private Ltd., the subsidiary it established here in July 2013.
The 11-piece line started rolling out in April in Mumbai, New Delhi and Bangalore. Currently in about 100 doors, it’s on track to reach its target of 250 doors by yearend; distribution includes department stores like Shoppers Stop and Central, as well as in beauty specialty stores such as New U and smaller, more traditional beauty formats.
“India is a strategic market for the company. Having been present since 2001, Shiseido aims to further strengthen its foothold with the entry of Za,” said Yu Okazawa, corporate executive officer and director of the board at Shiseido Co. Ltd.
“Za is one of the key drivers of our growth in the region,” agreed Tsutomu Benjamin Suzuki, managing director of Shiseido India. Za’s lower prices and target age positioning have made it more viable to introduce than Shiseido’s more premium ranges. The Shiseido brand, for instance, has been in India since 2001 and is in 30 doors, mostly department stores. It is marketed through Baccarose, one of India’s largest prestige beauty distributors.
Suzuki acknowledged Baccarose’s work to increase Shiseido’s brand awareness and sales growth. “Over the years, they [Baccarose] have grown not only our brand’s presence and awareness, but also that of the entire luxury beauty category. Our relationship is very strong and we intend to continue to nurture it even going forward,” he said, when asked whether the subsidiary would take over the prestige brand.
When it came to the launch of Za, Shiseido did its homework, researching the market for three years before moving forward. Its primary competitors include L’Oréal, Garnier, Pond’s, Nivea, Neutrogena and Lakmé. “Although Za has an extensive catalogue of makeup and skin care, we have selected our skin-care lineup that features whitening, age-prevention and the two-in-one foundation for our India entry,” said Salman Bukhari, marketing director, Shiseido India Pvt. Ltd. “We have priced the brand in line with the prevailing market standards.” Prices range from 349 rupees ($5.73 at current exchange) to 1,399 rupees ($23).
Bukhari said makeup would be launched later, after the company has a grasp on the treatment market. Za plans to have a widespread geographical footprint in India, and is looking at a variety of formats, including department stores and multibrand beauty outlets in modern trade and traditional trade. “Mumbai and Delhi are certainly the cities that we are growing this year, and Bangalore. For a brand that speaks the language of metropolitan women, we want to ensure that Za is present in these key metro [areas],” he said.
The target customer base is 20- to 35-year-olds, young women who are looking for quick solutions. The whitening range, in particular, plays into a key segment in India — fairness products have led the market for years, with Hindustan Unilever’s Fair & Lovely holding more than 40 percent market share.
The Indian beauty market — estimated at approximately $1 billion in sales — has been growing at 15 to 20 percent a year. The mass segment is expected to grow at more than 20 percent for the next five years, according to industry analysts. The country’s middle-class population has grown to 400 million people, with ballooning disposable income and an aspiration for grooming as more women enter the workforce.
Although many global beauty brands, including Estée Lauder and The Body Shop, have entered India over the last decade, Bukhari believes the timing is right for Za. “We are a bit late,” he admits, but added that it was better in some ways as “customers are already more educated.”
Unlike in many other Asian countries, many prominent Japanese beauty brands are still unavailable in India. Historically, India has been considered hard to scale because of its vast geography and bureaucracies. India, long known as a fragrance market, has begun to change dramatically over the last few years. Skin care and makeup are fast-growing segments and consumers are showing themselves more willing to experiment.
“We aim to be a global player, representing Asia with origins in Japan,” Suzuki said. “Such a vision must include one of Asia’s most dynamic economies — India. We have very high expectations for this market, especially as Za is in the masstige category.”
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