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Translated by
Nicola Mira
Dec 15, 2022
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LVMH closes its Cha Ling cosmetics stores in China

Translated by
Nicola Mira
Dec 15, 2022

Cha Ling, the cosmetics brand launched by the LVMH group in 2016, is closing down its Chinese stores, according to Chinese newspaper Jing Daily. The brand has indicated it wants to change its retail strategy in China, where it will now rely on its presence at LVMH-owned selective perfumery chain Sephora.

Cha Ling products showcased at the Sephora stand at China International Import Expo in November 2022 - Sephora

In November, at the fifth edition of the China International Import Expo trade show, Sephora notably showcased four of Cha Ling’s leading skincare products. According to Sephora, since Cha Ling was launched on the Chinese market in 2017, its products have generated a revenue of €13 million.

Cha Ling means 'tea forest' in Mandarin, and its products are developed using Pu'Er tea, known for its anti-oxidant and anti-ageing properties and grown in China's Yunnan province. Cha Ling was first developed by the LVMH group under the aegis of Laurent Boillot, now president of Hennessy but at the time in charge of Guerlain. He was inspired by a meeting with German biologist Josef Margraf and his Chinese wife Minguo Li.

Cha Ling, whose brand positioning is a mix of luxury and sustainability, used to be sold at Le Bon Marché department store in France, but has not been commercialised in the country since 2020. The brand's decision to change strategic direction in China is likely due in part to the impact of the pandemic and the country’s zero-Covid policy, which has caused in-store footfall to slump.

C-Beauty’s rising influence

In China, global cosmetics players are also facing increasingly stiff competition from C-Beauty brands, local Chinese brands that are becoming more and more popular. A trend to consume Chinese branded products that is consistent with the drive to integrate Chinese culture and traditions with the country’s consumer goods market.

In recent years, a number of Western luxury and beauty groups have launched brands calibrated specifically for the Chinese market. Hermès did so with Shang Xia, and recently L'Oréal, via a joint venture, has launched the Shihyo skincare brand, designed for north Asian markets. However, as Jing Daily has indicated in an analysis of China’s luxury consumer trends, no single player has yet fully taken control of the high-end market segment, notably because of competition from local brands, which are deemed more authentic.

In the beauty sector, Chinese brands such as Florasis, which is also making a foray outside the domestic market, and Perfect Diary, are among the most popular with young consumers. As a result, some Western groups are taking a different course, looking to acquire successful Chinese beauty brands. A strategy followed for example by L'Oréal, which bought a minority stake in Chinese fragrance brand Documents in September.

The Chinese beauty market is growing at an average annual rate of 12.3%, driven by a generation of young, fashion-conscious consumers, and is expected to be worth €49 billion in 2024.

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