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Coty Group Global Chief Brands Officer Stefano Curti on plans to triple its China business through a strategic shake-up

June 30, 2023
in Entertainment
Coty Group Global Chief Brands Officer Stefano Curti on plans to triple its China business through a strategic shake-up
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Founded in Paris in 1904, Coty Group is one of the world’s largest beauty companies with a portfolio that spans premium to mass market brands, including Burberry, Adidas and Max Factor. So, it might come as a surprise that Coty Group’s business in China accounts for just 4 percent of its global revenue.  

Coty Group is ready to change this. Capitalizing on post-pandemic growth in China’s beauty market, led by fragrance and skincare, the French-American company has modified its development strategy and re-positioned its brands with the aim of expanding its business in China to generate 10 percent of global sales. 

China’s beauty and personal care market revenue will grow 5 percent year on year to $98 billion in 2023 and continue climbing at 6.5 percent per year over the next four years. The premium market is estimated to surpass the mass market by 2026, according to Euromonitor International.

Jing Daily spoke with Stefano Curti, Coty Group Global Chief Brands Officer, to learn more about the business’ growth strategy and current consumer beauty trends in China.

Coty Group’s consumer beauty business performed strongly and won market share globally through the pandemic. However, China contributes to a surprisingly small portion of total revenue. How do you plan to enhance your brands’ sales in the country? 

Three years ago, a new executive committee refocused Coty Group to become a pure beauty powerhouse. We developed a six-prong strategy encompassing consumer business, prestige fragrances, expanding presence in skincare, digital transformation, sustainability leadership, and most importantly, growing our business in China from 4 percent to 10 percent of global revenue. 

Coty Group is the global market leader in fragrance, so a key focus is to strengthen our China positioning in fragrance, both prestige and ‘masstige’ [between mass market and prestige], which is a very under-developed segment. Another major focus is skincare, including ultra-premium launches of Lancaster’s Ligne Princière line and the Orveda brand, which will be launched in China soon. We also relaunched two important consumer beauty brands for China in 2022, namely Adidas and Max Factor.

What are the differences between beauty consumers in China and other markets? What is your approach to localization?

Chinese consumers are very sophisticated and discerning with regards to their awareness of and expertise in ingredients and technology, online research of products, demands for skin benefits, and preferences for sophisticated packaging and new delivery systems. 

Globally, our e-commerce business accounts for 10-20 percent of sales, but it’s much higher in China, which reflects the country’s advanced digital ecosystem. Expectations are high for an effective omnichannel experience.

A major part of our strategy is creating a Chinese portfolio that’s in China for China. We hope to share beauty technology and health benefits from our international brands combined with local insights and partnerships to offer products and experiences that are relevant to our Chinese customers. 

To do this more effectively, we have expanded our research and development center and manufacturing plant in China to significantly strengthen our footprint and establish authentic connections with local consumers.

Coty Group last year re-launched the century-old beauty brand Max Factor in China to focus on Chinese Gen Z consumers. Why did you choose to collaborate with Chinese fashion incubator Labelhood, and do you have plans to launch new products?

Max Factor is growing fast since its re-launch globally in 2022. We focused on a hero product — FaceFinity powder compact — and collaborated with Chinese fashion incubator, Labelhood. This partnership saw us work with two Chinese designers on limited-edition compact cases. 

Max Factor’s partnership with Labelhood on two limited-edition FaceFinity compact case designs helped position the brand as fashionable and locally relevant for Chinese Gen Z consumers. Photo: Coty Group

The partnership aligned the objective of Max Factor, to empower and unveil the extraordinary in people, with Labelhood’s mission to promote emerging Chinese talent. Next, we are launching Miracle Pure series, a sub-range of color cosmetics made with 90 percent skincare ingredients. 

With today’s consumers demanding multi-tasking skincare and make-up products, Max Factor’s new Miracle Pure range is richly infused with skincare ingredients, including Vitamin C and Hyaluronic Acid and provides 24 hours hydration. Photo: Coty Group

In the last quarter of 2022, Adidas, whose consumer beauty line is led by Coty Group, renewed its product lines and launched a new line. What’s the strategy for Adidas’ brand renewal and how are you attracting new customers?

Adidas recently became number one in the male shower gel segment in China. Building on this popularity, we have plans to expand and premiumize the brand in China. We will introduce premium unisex lines, such as Active Skin & Mind [a sports-care, eco-friendly range that was launched in Europe last year]. We are also working with Chinese sporting champions that embody Adidas’ values on some exciting upcoming projects — watch this space.

Already a market leader in male shower gel, Adidas will launch more premium sports wellness products for men and women. Photo: Coty Group

What other emerging opportunities do you see in China’s beauty sector post pandemic?

The pandemic completely changed the beauty landscape. The global beauty market has rebounded above pre-pandemic levels, but it’s a very different market. We have seen the explosion of the fragrance market, with consumers turning to fragrances as mood-boosting and affordable luxuries in uncertain times. 

Self-care has become much more important. Consumers are not just concerned about looks, but more about health benefits and nourishing regimens, like face or foot masks. Likewise, we are seeing a transformation of the color cosmetics category to incorporate skin and health benefits, such as sun care, antioxidants, or anti-ageing ingredients. 

Finally, the very definition of beauty is changing. As part of Coty Group’s social agenda, we launched the #UndefineBeauty campaign this year calling on English-language dictionary publishers to adjust their outdated definitions of ‘beauty’ to become more inclusive. This is an important part of our purpose: we believe our objective is not to impose a version of beauty, but rather give global beauty consumers the tools to unveil and discover their own definitions of beauty.

Coty Group’s #UndefineBeauty campaign takes the form of an online petition calling for change in traditional dictionary definitions of beauty. Photo: Coty Group

What is Coty Group’s outlook for its consumer beauty business in China through 2028?

We believe the “fragrance effect” [an update of the “lipstick effect” as an economic indicator] is a good sign of the beauty market’s resilience in the years ahead and we have a lot of potential to grow from a small base in China. Our new China strategy has pushed us to become a digital-first, consumer-first business, and we will continue to accelerate partnerships with e-commerce platforms and introduce exciting new brands and products that are relevant to Chinese consumers of all ages. 

This interview has been edited and condensed.

>>> Read full article>>>
Copyright for syndicated content belongs to the linked Source : JingDaily – https://jingdaily.com/coty-group-plans-to-triple-its-china-business-through-a-strategic-shake-up/

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