Market analysis: LA MER in China

20Dec2012

LA MER has a history that distinguishes it from any other cosmetics company. While most skin care products come from laboratories, LA MER is developed by a space physicist, Max Huber. His face was badly burned when he was working for NASA, and he looked up many ways to erase the scar tissues, but could not find a product that gave him the results he was seeking. This clinging researcher quit his job and used the garage of his house as the laboratory to develop a cure for his face. After over 6,000 experiments in 12 years, LA MER was born. It was the one product that could heal his deformity. Even though this brand never advertises its products, it successfully sells its products simply because it works and as a result, spreads through word of mouth.

LA MER and Estee Lauder in China

In year 1995, LA MER was bought by Estee Lauder, which entered the Chinese market in 1993 along with another brand, Clinique. Now, Estee Lauder Group has over 150 special counters in large department stores in over 33 big cities in China. Now, its brands such as Estee Lauder, Clinique, LA MER, M.A.C., Bobbi Brown, Aramis, and DKNY are all growing in popularity throughout in China.

After LA MER was bought by Estee Lauder, it had access to more resources to invest in R&D, and in 1999, it developed a complete product series of face and body skin care products. Currently, it is sold in over 43 countries and districts.

LA MER entered the Chinese market when its first special counter opened in 2004 in Sitech Plaza in Beijing(北京). Then, in 2007, it opened a second special counter in Shin Kong Place(新光天地), which, together with Sitech Plaza, gave it two locations within the CBD of Beijing. Later also in 2007, it opened a third special counter in the Lane Crawford on Finance Street in Beijing. Then in 2009, in addition, another counter opened in Yansha(燕莎) Friendship Shopping Mall.

In Shanghai(上海), LA MER has 3 special counters, one in Westgate Mall(梅龙镇广场), one in Orient Shopping Center(东方商厦), and one in Nextage(第一八佰伴). Also, LA MER has special counters in large representative department stores in Hangzhou(杭州), Kunming(昆明), Chengdu(成都),Tianjin(天津), Nanjing(南京), Suzhou(苏州), Wuhan(武汉) and Guangzhou(广州).

Future prospects

Unlike its competitors, Procter & Gamble and L’Oreal Paris, Estee Lauder focuses more on high end products. In China, the high end cosmetics market has been growing faster than the over cosmetics market and this trend is expected to continue. Thus, LA MAR a lot of market potential to explore as Chinese consumers earn higher incomes and its consumer base increases.

Daxue Consultant China

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Credit Photo: Baimei