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Market analysis: Herborist in China

Herbotist is the brand that entered China middle and high end personal care market in year 1998. Combined with modern technology, herbs are made great use of in the products of Herborist. Ever since its entrance into the market, Herborist has won a special reputation with its brand positioning and sales channel. It has now successfully set up its brands image as being fresh, natural, and healthy.

In August 28th, 1998,Herborist had its first exclusive shop in Hong Kong(香港) Plaza in Shanghai(上海). In July, 2011, the products of Herborist came into Hong Kong, and had its first exclusive shop in Mongkok(旺角), and then the second in Causeway Bay(铜锣湾). After years of development, in January, 2005, the number of its exclusive shops has reached 100. In April, the products of Herborist successfully settled in the well-known international chain cosmetics retailer, Sephora, which marked its entrance into the international market. Later in year 2008, Herborist entered the market in Paris, and gave rise to a trend of buying Chinese herb products. With the development of E-commerce, Herborist had its official website and online store in 2009.

The Future Cosmetic Giant

Since China joined WTO, the lowering customs had made it inevitable that the cosmetics market in China will become internationalized. Up to the end of year 2007, all the world’s mainstream cosmetics brands had entered China market, and the competition between international brands and domestic brands were becoming increasingly fiercer.

Now, there are 12 big brands that cover China’s high end and middle end markets. P&G , after introducing its middle end brand, Olay, later introduced SK-II to have a share in the high end market. LVMH in France introduced its Dior, CD and Givenchy successively. Also, big brands like Shiseido and Estee Lauder also come to China market one by one. In first tier cities like Beijing(北京), Shanghai(上海), Guangzhou(广州) and Shenzhen(深圳), many special counters are under the monopoly of foreign brands. Despite the growth in China’s domestic brands, international brands like L’Oreal, Olay, Aupres, Lancôme and Shiseido are still the leading plays in terms of sales value.

Despite all these difficulties in competition, Herborist is performing well. The main reason is its advanced technology. A common drawback of Chinese products is the less developed technology. Having realized this, Herborist established its own R&D center in 2007 by cooperating with 5 university-affiliated hospitals. Also, by stressing its herb contents, it successfully distinguishes itself among the many brands. In addition, compared with foreign brands which are more under the influence of western culture, Herborist knows more about what Chinese consumers appreciate and need. Thus, it is hopeful that Herborist will become the leading Chinese cosmetics brand.

Edited by Amy Wang from Daxue Consultant China

Credit Photo: Baidu