Japanese beauty heavyweight Shiseido has said it will step up its acquisitions of skin care brands in markets further afield than China.
Speaking to the Financial Times, Masahiko Uotani, Chief Executive of Japan’s biggest cosmetic group, is particularly keen to escalate takeover efforts in the US and Europe, and even hinted that India and Africa could be new markets for investment.
In the first six months of 2021, Shiseido generated 30% of its revenue in China, which has been attributed to growing consumption of the rising middle class in the region.
“We believe the longer-term potential is extremely high in China and we will firmly capture this opportunity,” Uotani told the publication.
“But as our dependence increases, there will be questions on contingency and portfolio management, so we want to strengthen our efforts even further in the US and Europe.”
The decision to diversify its target markets follows Shiseido’s asset restructuring spree, following a tough market due to Covid-19, which forced lockdowns and travel restrictions.
In August, Shiseido sold its North American cosmetics brands: bareMinerals, Buxom and Laura Mercier to AI Beauty Holdings, a new company formed by private equity firm Advent.
The move followed Shiseido’s decision to divest its low-budget personal care brands to CVC for an estimated US$1.5bn.
A continuation of its portfolio cull, the group cut ties with luxury cosmetics brand Dolce & Gabbana, which Shiseido has held the license for since 2016.
Big name brands left in its umbrella include Drunk Elephant, Clé de Peau Beauté, NARS and its own Shiseido cosmetics brand, as well as a selection of fragrance houses.
“We are exploring mergers and acquisitions so that we can respond to every kind of skin care need,” added Shiseido’s boss about the company’s future plans.
He also mentioned that Shiseido would likely invest in digital technology and data analysis as the pandemic throws consumer focus on wellness into the spotlight.