Maximising recovery: Shiseido will increase marketing investments by $132m after ‘holding back’ in previous year

By Amanda Lim contact

- Last updated on GMT

Shiseido will be making “aggressive marketing investments” in the fourth quarter. [Shiseido]
Shiseido will be making “aggressive marketing investments” in the fourth quarter. [Shiseido]

Related tags: Shiseido, Marketing

Japanese beauty and personal giant Shiseido will be making “aggressive marketing investments” in the fourth quarter to capitalise on what it believes is the beginning of market recovery from this year’s COVID-19 resurgence.

Speaking during the firm’s third-quarter financial results conference on November 10, CFO Takayuki Yokota said its marketing investments will increase by JPY15bn (U$132m) like-for-like versus last year.

“In order to capture definite growth for next year and onwards, we will make advanced marketing investments, which we had to strictly control in the previous year.”

He highlighted that the company has already started by strengthening the Singles Day shopping festival promotions in China.

“In China, we have been planning for Double 11, or Singles Day, by preparing more Double 11 limited set items than before and handing out samples to potential consumers online before the presale to cultivate more demand. As a result, the Double 11 Promotions are performing well.”

The company will also focus marketing efforts on the holiday season, which it had to restrain last year.

“We will expand investments to maximise the holiday season opportunity in regions such as EMEA and Americas, which we have had to hold back on last year,” ​said Yokota.

The marketing investments will also help the company get its home market back on track after a difficult year peppered with COVID-19 restrictions that affected consumer traffic.

In the latest quarter, the company saw sales improve in all regions except Japan.

With recovery on the horizon, the company intends to strengthen investments in Japan from November and onwards.

“Japan went through intermittent states of emergencies since January of this year, but with the [State of Emergency] lifted on October 1, along with the COVID cases declining, we assume that the market will start to recover from November,”​ said Yokota.

Skin beauty innovations

In addition to marketing, the company hopes to accelerate growth with innovations in skin beauty.

The company recently announced the launch of a new ingestible beauty brand, Inryu. The brand will be available in Japan starting January 2022.

The company said and will expand to China via e-commerce starting March 2022 as it believes there is strong potential for inner beauty products in the market.

“Due to the heightened awareness of consumers in beauty inside and out, the ingestible beauty market is a category with high expectations for big growth in China,”​ said Yokota.

Inryu was developed by Shiseido’s China Business Innovation and Investment Office (CBI), which was established to promote innovations in existing businesses and new business development.

“The CBI office that was established in 2019 in Shanghai. It did an analysis of these consumer insights and together with the long years of expertise and knowledge of Shiseido to nurture internal physical beauty, we developed the brand.”

While the company is optimistic about market recovery, it added that returning to pre-pandemic levels will take time. It had previously estimated that the company will return to form in 2023.

“We assume that the market will start to recover from November in various regions, including Japan and some categories, it’s assumed that it will take more time to recover back to the 2019 market level,” ​said Yokota.

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