Estée Lauder's Early-Stage Venture Arm Invests in Chinese Fragrance Brand

Estée Lauder's early-stage venture arm, New Incubation Ventures, has taken a minority stake in the Chinese fragrance brand Melt Season. This strategic move signifies Estée Lauder’s first investment in a Chinese fragrance brand, following its earlier minority investment in the Chinese skincare and makeup brand CodeMint in September 2023.

Launched in 2021, Melt Season positions itself as a high-end Chinese salon perfume brand, offering a product range that includes perfumes, fragrances, and personal care items priced between CNY 230 and CNY 980. Despite its relatively short existence, Melt Season has previously secured two rounds of financing with contributions from prominent investors including One Capital and Breeze Capital. The brand has demonstrated notable strengths in brand value construction, product quality, and offline store presence, garnering favorable attention from investors.

Estée Lauder's perfume portfolio in the Chinese market comprises well-known names such as Estée Lauder, Jo Malone, Editions de Parfums Frédéric Malle, By Kilian, LE LABO, TOM FORD. The investment in an oriental fragrance brand strategically aims at expanding Estée Lauder's footprint in the local market. This strategic approach allows Estée Lauder to diversify its portfolio, better catering to consumers with an affinity for oriental fragrances and solidifying its position in China’s high-end perfume market.

According to the 2023 China Perfume Industry White Paper by Eternal, the perfume market in China is projected to surpass CNY 20 billion in 2023, with the potential to reach CNY 53.9 billion by 2028. The flourishing perfume industry in China has become a fiercely contested arena, with beauty enterprises strategically diversifying their perfume brand portfolios to meet the evolving preferences of Chinese consumers.

LVMH-Backed Private Equity Firm Invests in Two Chinese Beauty Brands

L Catterton, the LVMH-backed private equity firm, has made significant investments in two Chinese beauty brands. The first investment is in the Chinese foundation brand BlankMe, founded in 2019 and has experienced remarkable growth, securing its position as one of the leading Chinese foundation brands.

In recent years, the foundation category has emerged as a high-performing segment in the makeup sector. According to iResearch, the market size of foundation products has consistently outpaced the overall growth of the beauty market for seven consecutive years, spanning from 2016 to 2022. In 2022, the market size reached CNY 47.7 billion, and it is expected to exceed CNY 60 billion by 2025. The foundation market, characterized by higher entry barriers, customer loyalty, and product prices compared to other color cosmetics, has gradually become a focal point in the makeup sector.

L Catterton's second investment is in a children's skincare brand, Hi!papa. In recent years, Hi!papa has emerged as a dark horse in the field of infant and children's skincare. Since its founding, Hi!papa has developed a series of products that differentiate it from traditional infant and child skincare brands, gaining popularity among consumers. Fueled by concepts like precision parenting and age-specific skincare, the Chinese infant and children's skincare market is witnessing substantial potential for market expansion.

Shiseido Launches First "Personalized Cosmetic Service" in China

Shiseido has unveiled its IPSA ULX Customization Center in Shanghai, marking the company's inaugural personalized cosmetic service project in China. At the IPSA ULX Customization Center, consumers undergo a specialized skin test through IPSALYZER, the brand's exclusive skin testing device, assessing over 20 skin dimensions. Following the skin analysis, IPSA provides customers with a tailored ingredient formula that aligns with their skin profile, based on which the ME CUSTOM ULX cream products are produced to address these skin issues.

With the implementation of Several Provisions on the Innovative Development of the Cosmetics Industry in Shanghai Pudong New Area, personalized cosmetic services have come under the spotlight. In late April of this year, L'Oréal secured China's first "on-site personalized service" cosmetics production license for its SkinCeuticals store in Shanghai. This on-site personalized service is a four-step process that includes professional recommendation, precise proportioning, homogeneous blending, and personalized packaging at the store. In August, Le Labo, Estée Lauder's niche perfume brand, unveiled its first store in Shanghai, where personalized services are also provided. Consumers can choose their preferred perfume type, and perfumers prepare the product in a transparent and sealed laboratory. After preparation, consumers can customize a label with their name to attach to the bottle.

Disclaimer: All pictures used in the article are from the Internet.