Wellness Franchise Opportunities

international brandsOct, 29 2015

Half of our online sales come from cities where we have physical presence: Za Business Head

Za is a highly acclaimed brand loved by millions metropolitan women around the world for its high efficacy, sensorials and elegance. The brand is reaping good profile out of its online presence in comparison with its Brick & Mortar presence.

By Niharika Verma

Shiseido Co Ltd has launched its wholly-owned subsidiary named Shiseido India Private Limited in March 2014. Part of the company’s Asian Breakthrough strategy, this strategy was focuses on growth in Asian countries, including India that boasts of burgeoning beauty market, which is expected to grow significantly in the coming years. With the establishment of this subsidiary, our focus is on further strengthening our foothold in the Indian market, starting with our premium brand Za.

In an exclusive conversation with WI Bureau, Salman Z Bukhari, Marketing Director, Shiseido India Pvt Ltd, has shared his views on Indian beauty & wellness space, growth opportunities for international brands in the country and much more.

What kind of opportunities do you see in the Indian market which made you tap the space?
Traditionally, a mass driven space, the Indian beauty industry has seen a big boost in past decade. There is a growing upward movement, both in terms of brand preferences, offerings and related spending, by the Indian consumers. This should be attributed to the growth of economy and the high rise of the middle income urban consumer and unprecedented exposure. This trend will continue to grow in the years to follow, as, India has begun gaining speed in turning into the Asian growth engine. For The House of Shiseido, India is of a strategic importance- both in terms of present market size and the future growth potential. We have been studying the Indian market closely and we do see a shift in the consumer engagement and preferences with the beauty category – the market is evolving at a rapid speed as a result, we see a larger demand for international brands like ours in the country.

What is your marketing strategy to tap Indian beauty and wellness space, already being captured by thousands of brands?
The market is undoubtedly getting crowded with the entry and growth of brands, what is key to stand out in any environment is brand uniqueness, presence and delivery of promises.
    Za is a highly acclaimed brand loved by millions metropolitan women around the world for its high efficacy, sensorials and elegance. In India, we have a focused approach at reaching out to the consumers through the most relevant touch-points. There is a paradigm shift in the media consumption by our target consumer. From TV she is shifting to YouTube, Instead of Celebrity endorsements she seeks opinion of Beauty Advisors and her peers, she reads less printed material like magazines and gets most of her information online. So while we do traditional marketing using print and other mediums, our primary focus is on Digital, Influencer marketing, below the line activations print and in-store promotions.

What are the price points on which you are selling your products?
Za is a premium brand in India and is priced in accordance with the market. Our average price is in the range of Rs 800 to Rs 1,000.

Who are your target consumers?
Our brand Za features a highly innovative and advanced skin care and make-up line that is designed especially for Metropolitan women, falling under the age group of 20-35 years, who desire sophisticated and fashionable beauty.

Have you made it to Indian market through Ecommerce or some other route you’ve taken? What’s your take over making way towards Indian beauty & wellness consumers through eCommerce?
Since its launch in 2014, Za is available across multiple retail formats, including Department Stores & Multi-Brand outlets in both modern and traditional trade in Mumbai, Delhi-NCR and Bengaluru.  With immense demand for our brand coming from other cities in India and the exponential growth of Indian Beauty and Personal Care eCommerce business, it became imperative that Za becomes available to more Indian Metropolitan women.
   We decided to enter eCommerce in our launch year itself and selected Nykaa.com as our preferred partner for online retail, owing to their strong focus on beauty and personal care.
We were not surprised to see the brand just take-off on eCommerce from day1. The brand awareness we generated using multiple mediums, surely penetrated other cities as well and the demand that was generated for Za, reflects this. Nearly half of our online sales come from cities other than those, where we have our physical presence.
While eCommerce is growing faster than any other mode of retail in India, it does not come without its own challenges. Brands simply cannot use the same approach as they do in the physical stores on this medium. It is important to be visible prominently be relevant and flexible.

What challenges did you face or are facing to create a niche for your brand into Indian Beauty & wellness space? What is your strategy to combat the eminent challenges existing into the space?
Lack of awareness was the first challenge that we faced in launching our brand Za in India. Most often consumers are acquainted with international brands before they even enter the market, thus making the task a lot simpler. In our case, although Za is very successful in other markets, we knew the Indian consumer has never heard of it. We had to start building the awareness from zero basis. Since we focus on the brand’s skin expertise, credibility and trust is also important before the consumer accepts us. We took these challenges head on by reaching out the right consumer through relevant mediums. We never over promised, but always over delivered. Our Japanese provenance, Breakthrough technology and uncompromising stance on quality supported the creation of the brand Za.

How much percentage of profit margin you are keeping on products’ sale in India? Does selling in India is easier or tough in comparison with other countries you have entered in?
Each market has its own uniqueness and challenges and India is no different in that aspect that is important is that companies learn to quick and effectively adapt to their market’s environments in order to be impactful. As a company, we do not believe in applying the same formula everywhere, it simply does not work. The Indian market comes with its own set of unique challenges such as higher traditional trade skew, price sensitivity, lack of infrastructure, logistical complexities, etc. We have faced these by making strategic choices and implementing them.

What about expansion in India? Please elaborate. Any plans to establish presence in brick & mortar (If currently present on eCommerce) or other way round?
We are upbeat and positive for the future. The task on hand for us is to strengthen our operations and to continue increasing awareness. There are new exciting products, newer doors and more refined experiences that are on the charts to delight the Indian Metropolitan women. This is just the beginning!

Related: Soon to be 'billion dollar’ firm, French beauty giant L'Oréal ramps up India operations

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