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Shiseido in Russia

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Submitted By skander
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As the world’s economy continues to rebound from recession, many companies and brands are focusing on the growth of emerging markets—particularly BRIC markets. However, as discussed in Carrie Lennard’s article “BRIC Key for Future Growth” in the June 2010 issue of GCI magazine, Russia—the “R” in BRIC—felt the economic downturn quite strongly (“Growth in premium beauty products slid down from 20% during 2006–2007 to 0% 2008–2009.”) and is still not seeing some of the other gains of similar markets. However, as discussed below, some beauty brands are still targeting the country as a key for growth in the coming years.

To note, Shiseido announced plans to introduce its corporate culture and promote sales at a Shiseido Exhibition/1872–2011/Empire of Beauty event in Russia. To be held from March 1 to March 20, 2011, the event will take place in the arcade of GUM, the landmark in front of Red Square that is one of Moscow’s largest department stores and an attraction for tourists worldwide, as well as Russian consumers. The event space is nearly 90 meters long, and the showcase will allow visitors to witness Shiseido’s history and aesthetic sensibility through exhibits of an array of products, posters and other items introducing Shiseido’s corporate culture.

Moreover, a sales promotion corner will offer trials of skin care products from the global brand Shiseido premium cosmetics lineup. This initiative advances Shiseido’s aims to further enhance its presence while continuing to successfully expand its business in the Russian market.

Shiseido is focusing on expanding sales in emerging markets with the aim of becoming a global player representing Asia with its origins in Japan. The company considers Russia a particularly promising market and after commencing sales there through a distributor in 1999, established Shiseido (RUS), LLC in 2007 as a wholly owned subsidiary commencing direct operations in 2008. Subsequently, the Russian market became a model of growth in emerging markets.

In terms of its sales strategy, Shiseido has been promoting initiatives to expand business partners and the number of stores handling Shiseido products, centered on Russia’s major cosmetics specialty chain stores, which have grown significantly by approximately threefold to about 900 stores as of the end of December 2010 compared with the previous fiscal year. Specifically, sales of global brand Shiseido skin care products ranked second in December 2010 in the skin care category at L’Etoile, a large cosmetics specialty chain store based in Moscow. Global brand Shiseido is thereby steadily building its position in parallel with major brands in Europe and the United States.…...

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