Cosmetics giants brush off any talk of slump in China (4)

Shiseido's beginnings in the mainland go back to 1981 when it first sold about 60 imported products at large retail outlets and hotels in Beijing.

It launched Aupres, a brand exclusively for department stores in China, in 1994.

The 140-year-old company established Shiseido China Co Ltd, a wholly owned subsidiary, in Shanghai in 2003, after starting production at its own factory and opening Shiseido China Research Center Co Ltd, both in Beijing.

"We have more understanding about local consumers and have also gone ahead in creating special products for Chinese consumers," said Yang, explaining Shiseido's advantages on its competitors.

Shiseido has also recently expanded its sales channels into specialty cosmetics stores that are more popular in lower-tier Chinese cities, selling mostly its Urara and Pure&Mild brands.

It now has contracts with more than 5,900 stores.

"It gives us a convenient way to have contact with consumers, especially in smaller cities," Yang added.

"I think one very important concept that can explain the success of a brand regardless of its origin, is its sales channel strategy.

"Currently, the bulk of our sales are still being made in department stores or retail outlets such as Sephora.

"Asian brands are more focused on all-natural products that enhance appearance, for example, with hydrating lotions or skin-whitening creams, which are very attractive to younger consumers in the 15-30 age group who are less focused on maintaining their youthful appearance."

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