Q&A with Yves Rocher's Chia Lin Coispeau

And other people news in Greater China

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Yves Rocher, a French-based botanical beauty care company, is hoping to break into China as an increasing number of women are willing to invest in luxury cosmetics. China is one of the world’s ten largest beauty markets and unlike many retail categories where there is strong local competition, the upper end of the market has become fertile ground for foreign manufacturers, particularly Japanese skin care brands and European cosmetics.

Although Yves Rocher's turnover tops $2 billion from sales in 88 countries, the global company only entered the Chinese market last year, through a local distributor. In March 2007, it took full control of its sales and distribution in China, where it now sells skin care products, cosmetics, body treatments and perfume. Bris Rocher, grandson of founder Yves Rocher, relocated Chia Lin Coispeau to Shanghai as managing director for China and strategy products director for Asia

She joined the company in Paris in 2003, before which she worked for the strategy consulting firm Bain & Co, where she designed brand and market entry strategies for international consumer brands in Europe and Asia. Previously, she worked for the LVMH Group in Paris on its Louis Vuitton brand and on Diageo's Guinness brand in London.

Born in Taiwan but raised mostly in France, Ms. Coispeau is well versed in European and Chinese culture and consumption habits. In the past two months, she has appointed M&C Saatchi to help advertise the brand, largely through viral marketing and events, and has begun developing channels to create direct relationships with consumers in China. She recently talked with AdAgeChina Editor Normandy Madden about Yves Rocher’s plans in China and trends in the country’s beauty industry.

AdAgeChina: Why is Yves Rocher investing in China, a challenging market for a relatively small brand?

Chia Lin Coispeau: We are eager to expand in all emerging markets like China, which already is a very important market in terms of consumer goods. We know this will be one of the largest cosmetics markets worldwide. We are preparing for that. It’s a huge challenge for us but this brand is really suited for this market. It has a lot of affinity for Chinese culture, like a strong belief in nature.

We believe every woman can be beautiful by herself. This is a very different approach. Most cosmetic companies use models in their advertising and tell consumers, "Look like this." But we focus on consumers. This is very French in fact. Women there believe they can be beautiful at any age.

AdAgeChina: How did you adapt your European heritage for the Chinese market?

We changed our process in China in so many ways because women here are not like Europeans in many ways, and there are so many types of Chinese consumers. When looking at this market, we targeted our approach to figure out who could afford our brand and who could also be interested in our positioning, which is not just showing a model. We found we should target cities but a certain segment of women. For most of China’s history, women had to follow men but for the past half-century, they are more independent, they study, have nice positions in companies. These are the women we want to target.

In terms of age, they would be rather young. We don’t target many older than 40. In terms of cities, I think we can go much deeper than just the first tier cities, Beijing, Shanghai. We believe in cities that are more entrepreneurial we can also be very successful, so tier two and maybe tier three cities. We’re looking at where there are entrepreneurs.

AdAgeChina: So mainly cities where incomes are high?

Ms. Coispeau: Yes, relatively high. Of course, the beauty market is income-related, but the minimum income to buy imported cosmetics products is very low because these women want to dream. Some are going to save the whole year to be able to buy that dream. Consumption in China is quite different compared to countries like France, where there is more spending on areas like housing.

AdAgeChina: What are other differences between consumers in France, for example, and China?

Ms. Coispeau: In France, they would be older. Because of the aging population, there are more anti-wrinkle products there. You don’t have consumers at the age of 40 or 45 that often in China. But in Europe, many women at this age or older are willing to spend a lot on skin care.

China is a very, very strong skin care market and a very weak perfume market. Only a few percentage points are spent on perfume, but in France it would account for 25% of sales. In China, women are more interested in getting beautiful white skin and to prevent it from aging or getting tanned. We have also developed products for Asian skin, like whitening lines, one high-end and one for younger consumers that is a bit less expensive. Chinese also wear makeup that is much lighter than what would be used in Russia, for example. Perfume is the last category they will buy though.

AdAgeChina: Within China itself, do you have to change your strategy between the various cities?

Ms. Coispeau: Cities in China are completely different markets. Even tier one cities like Beijing and Shanghai are totally different. Skin care sales are driven by climate. For example, the creams we sell in Beijing are much richer. We don’t sell them in Shanghai at all. It’s also fashion related. Make-up in Beijing is much more colorful than in Shanghai, where women prefer pastel colors. We also tend to sell much more expensive products in Beijing but women in Shanghai like to get good bargains. They have that reputation and we really see this behavior in stores.

AdAgeChina: In Europe, Yves Rocher’s three major distribution channels are direct sales, mail order and your own stores. These three channels are not well developed in China, particularly for a new brand. How are you adapting your distribution strategy for China?

Ms. Coispeau: Most cosmetic sales in China take place in department stores, but our products are not sold in any department stores in France. So we developed a concept for department store counters and we’re doing some testing and retrofitting from our first experiences.

It’s an interesting adaptation, from customer understanding to the products we offer to the way we distribute them and even to the way we sell them to consumers. During the Maoist era, makeup and fashion were forbidden, so you don’t have the link here between mothers and daughters and the communication to daughters about how to become beautiful. We know that we have to help younger women to use our products. The beauticians at the counters become very important and the brand helps educate them. We provide a lot of literature here and consumers are very interested in reading every little piece of it.

AdAgeChina: French women don’t read the packaging and sales materials?

Ms. Coispeau: No, never! [Laughter]

Other appointment news in Greater China

[shanghai] WPP Group’s GroupM media division has appointed Warren Chen as managing director, China, responsible for deal management and new business development to support the group’s media agencies in the mainland, including Maxus, MediaCom, Mediaedge:cia and MindShare. Previously, he was managing director, China of Interpublic Group of Cos.’ Initiative Media. He will remain based in Shanghai.

[shanghai] The Walt Disney Company has promoted Stanley Cheung to exec VP-managing director, Greater China, including the media company’s business in China, Hong Kong and Taiwan, excluding Hong Kong Disneyland. Previously he was country manager, China, and he will remain based in Shanghai. Prior to joining Disney in 2004, he served as managing director, China of the consumer arm of Johnson & Johnson's operation in China. Mr. Cheung succeeds Doug Miller, who left Asia last September to return to the U.S.
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