China and India are two extremely important, but very different markets for L’Oréal, according to its chief digital and marketing officer Asmita Dubey.
The French beauty giant recently celebrated 25 years in China and Dubey told the audience that the country continues to see a rise of the middle class due to urbanization and with that, an increase in disposable income.
“Consumers are looking for better quality products. There’s a premiumization of the market happening in China,” said Dubey, who spent several years working for L’Oréal in China. “For us, it works because we work in categories like skin care or premium hair care and makeup and hair coloration. Beauty is about desire, it’s not just about utility.”
While she noted that the cosmetics market there was hit hard by COVID-19 and the subsequent lockdowns across the country, it is beginning to recover.
As for shopping trends, Chinese consumers are becoming increasingly more sophisticated, and are heavily influenced by social media such as Douyin and Xiaohongshu (Little Red Book).
“The Chinese digital landscape continues to evolve very rapidly. That’s because consumers adopt these technologies very fast. Last year we already saw live shopping and social interactions grow. This year it is becoming even more about shared experiences,” Dubey said, noting that around 65 percent of shopping takes place online, while more than 1 billion people are online in China, equal to one fifth of the global digital population.
As part of its business in China, it just announced a three-year partnership with Alibaba Group to promote a circular economy in China’s beauty industry.
“It’s about getting more environmentally friendly products, logistics, and educating consumers because consumers are becoming increasingly environmentally friendly,” she said.
India, meanwhile, is where Dubey believes a lot of L’Oréal’s new consumers will come from between now and 2030.
“Our approach there is to drive innovation and distribution for our mass beauty products for brands like Garnier, L’Oréal Paris and Maybelline,” she said. “There’s a role across divisions for luxury as well, but given diverse ethnicities, the growing middle class population of India, we believe that a lot of growth is going to come from mass beauty.”
Dubey concluded that while China remains its second largest beauty market in the world and L’Oréal is a beauty leader there, it is very ambitious about India.
“It was in a very ripe position for expansion for years. The last two years what we see is very positive in terms of the sophistication of the consumer, the changes in channel because of e-commerce — all that with a super digitally powered ecosystem,” said Dubey. “That’s also the case in China, but what is happening in India today is very optimistic and with that we are very optimistic about it.”