While Japan’s beauty leader saw robust sales in its rebounding domestic market, this was not enough to offset weakness in retail travel and reported sales declines in other international markets. Nars, Drunk Elephant and fragrance were their main growth bags for the year.
The first year of its growth plan “Shift 2025 and Beyond”, Shiseido focused on transforming its business model to improve profits, reduce costs and boost productivity. Key initiatives include addressing market challenges, especially in China, and innovative product launches aimed at enhancing brand equity.
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At home, steady economic growth as consumers re-engaged with activities outside the home, plus the return of foreign visitors, boosted sales. Shiseido it attributed the growth to strategic product launches and promotion improvements, and said its domestic business had returned to profitability. Clé de Peau Beauté, the Shiseido brand and Elixir did well. Consumers were wary of rising prices, but market share grew every quarter, Shiseido said, although sales for the year were still down 25% on 2019 numbers. .
In China, after strong growth in the first half due in part to the low base of the previous year, weakening consumer sentiment impacted the market in the second half. Shiseido was also hit by the consumer boycott of Japanese products after the release of treated water from Fukushima into the ocean, and undercut the general market, which was also down, during the shopping festival “Double 11 ” in November. The company has sought to move away from large-scale promotional events to generate more sustainable growth there, and has cited Shiseido and Clé de Peau Beauté as its sales drivers. The business in China also generated a core operating profit once again thanks to the company’s focus on cost management.
In the rest of Asia-Pacific, Taiwan returned to growth, and South Korea and Southeast Asia performed well. The Nars and Shiseido brands were the growth drivers in the region.
In the Americas, sales in similar terms for as earned significantly, with Drunk elephant, Shiseido and Nars all do well. For the Shiseido brand, Anne Hathaway has signed on as a spokesperson.
In EMEA, sales leaders include Narciso Rodriguez with new fragrance All of Me, as well as Nars and Drunk Elephant, which benefited from expanded retail distribution.
Duty free in South Korea and Hainan Island remained soft due to retailer inventory adjustments, although domestic duty free sales were strong.
Shiseido relaunched the Inoui brand, which had been discontinued in 2002, and introduced Nars in India and South Africa.
As Shiseido looks to lean more heavily into skin health and wellness, in September it announced plans to launch the in-house beauty brand Shiseido Beauty Wellness, or SBW, starting in February.
In July, it invested and formed a strategic partnership with the biotech firm Chitose Group to produce micro-algae-based ingredients for cosmetics and containers.
In December, he said he would buy DDG Skin care Holdings, the owner of Dr. Dennis Gross Skincare. The brand is said to have recorded sales of $300 million last year.
He also formed an investment fund called Long Term Investments for the Future Ventures, or LIFT, to buy into innovative, early-stage companies in the beauty and wellness space. At the same time as the announcement, it said it was investing in two small, fast-growing brands: Phi Therapeutics Inc. and Patrick Kidd Holdings Pty Ltd.
In August, Shiseido’s former CEO Yoshiharu Fukuhara, the grandson of the company’s founder, died at the age of 92. global actor.
Following the reshuffle of its leadership in January 2023 – former president and CEO Masahiko Uotani became president and CEO, while Kentaro Fujiwara was appointed president and COO – Toshinobu Umetsu took over Fujiwara’s previous role of CEO of Shiseido China .
In February 2024, Shiseido announced that it will offer early retirement to 1,500 of its employees in Japan – about 3.7% of its global workforce – to help boost its growth and profitability.
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