Beauty brands going global: Huaxizi ranked top three in Japan, Perfect Diary suffered a net loss of 2.69 billion

Today, the domestic cosmetics brand Hua Xizi began selling its products on the Japanese Amazon website. This is the first time that Hua Xizi has entered an overseas e-commerce platform and also the first step for Hua Xizi to officially enter the overseas market.

Just last November, Perfect Diary, the parent company of the domestic beauty brand, Yatsen E-Commerce, was listed on the New York Stock Exchange with a market value of $12.2 billion. Looking at the development history of domestic beauty brands, it is not difficult to see that domestic beauty brands have entered the "Age of Discovery".

Give up Europe and I will go to Southeast Asia to make money to support you!

In fact, as early as five years ago, Chinese beauty brands had set off a wave of going overseas: Yu Nifang, One Leaf, Mofashijia, Xiangyi Bencao and other well-known beauty brands have set their sights on the European market, hoping to make a name for themselves in Europe with their high cost-effectiveness. Unfortunately, the European market does not seem to buy into this.

On the one hand, these domestic brands are not well-known in Europe, and it is not feasible to rely on low prices to attract customers in the European market where there is no shortage of money; on the other hand, the places of production are so far away that liquids, powders, and pastes cannot be transported on some routes, and logistics costs cannot be reduced. The original high cost-performance ratio has also been weakened by logistics costs.

After several domestic beauty brands hit a wall in Europe, the enthusiasm of Chinese beauty brands to go overseas has gradually faded. However, Chinese people never believe in fate, so in the past two years, domestic beauty brands have once again launched an impact on overseas markets. This time, they have set their sights on the Southeast Asian market.

According to a report by Mintel.com, Southeast Asia is listed as a "future market" that the global cosmetics industry focuses on developing , and is one of the hottest markets for cosmetics in the world. It is estimated that by 2025, the size of the Southeast Asian beauty and cosmetics market will exceed 300 billion yuan. Especially after the signing of the RCEP free trade agreement, a unified market covering about 30% of the world's population and accounting for about 29% of the world's GDP will be formed, which is also very beneficial for the overseas expansion of Chinese beauty products.

When Chinese products go overseas, some reach the top, while others lose billions

During the Double 11 shopping festival last year, Chinese cosmetics brands showed their amazing ability to attract money, with sales increasing more than tenfold, ranking first. Among them, the emerging Chinese cosmetics brands Huaxizi, Perfect Diary, Little Autine and Mao Geping became the four most eye-catching "dark horses", with Huaxizi even occupying the top spot in the list of Chinese cosmetics going global, becoming the biggest dark horse in the Double 11 shopping festival.

In March this year , Huaxizi officially launched its plan to enter overseas markets and began selling its products on Amazon Japan. A "Love Lock Lipstick" is priced at 219 yuan in China and 6129 yen (371 yuan) on Amazon Japan. On the first day of its launch, it entered the top three of the hourly list of lipstick sales on Amazon Japan.

However, the current situation of Perfect Diary, which also occupies a leading position in the domestic beauty industry, is not so optimistic: In 2020, its parent company Yatsen E-Commerce's investment in marketing continued to increase after its listing, but Yatsen E-Commerce's financial report showed that in 2020, Yatsen E-Commerce's revenue increased but profits did not, with total net revenue of RMB 5.23 billion, a year-on-year increase of 72.6% from 2019, but a net loss of RMB 2.69 billion.

Also known for its marketing, Huaxizi's brand culture is more in line with the public's impression of China, whether in publicity, product development or outer packaging. Many foreigners who buy Huaxizi are amazed by the outer packaging; while Perfect Diary has been pursuing the route of big-name substitutes from the very beginning, and its differentiated advantages are not obvious. Even though it recently signed Zhou Xun and internationally renowned singer-songwriter Troye Sivan (nicknamed Troye Sivan) as spokespeople, the impression left on the public is just "a lot of advertisements."

As the "first beauty stock", Yatsen E-Commerce is still very strong. However, if it wants to go further in the global market, it may need to put more effort into product research and development and differentiated competition in addition to marketing.

E-commerce platform

Cross-border e-commerce market

Chinese products go abroad