Boutiques key to makeup industry

Cosmetics manufacturers are stepping up efforts to boost sales at specialty outlets staffed by employees who know a great deal about makeup, by increasingly catering to the needs of individual customers.

A distinguishing feature of such cosmetics stores is their ability to provide fine-tuned customer services. For instance, employees advise customers on which cosmetics will best suit them, winning them favour among middle-aged and elderly customers.

A major manufacturer said that in regions where there are many employees above the age of 60, the cosmetics stores "create a place for casual conversations about skincare between senior citizens."

The new move apparently reflects the fact that, in recent years, cosmetics manufacturers have been gradually losing ground to inexpensive drugstores and online shopping malls from which customers can buy products with ease.

According to research institute Fuji Keizai Management Co., the impact of drugstores selling their products at cheap prices has been substantial. It has led to a 40 per cent decrease in the number of stores in the industry, including pharmacies, in the last 10 years, as well as a 25 per cent decline in sales.

In response, cosmetics manufacturers have begun to shore up their products intended solely for stores that specialise in the sale of cosmetics, in order to woo new customers.

In September, Shiseido Co. will release new products aimed at teenagers and customers in their 60s in its "Benefique" skincare lineup. In October, Kanebo Cosmetics Inc. will market skincare products in its "Twany" lineup, such as facial lotion and cream, priced in the 2,000 yen (S$23) - 3,000 yen range.

The cosmetic stores now aim to increase the frequency of visits by existing customers as well as develop new customer segments, such as for young people, who have not visited cosmetics stores in the past.

Cosmetics manufacturers are also working to increase the quality of services offered by sales clerks. On Aug. 4, the Cosmetics Koshien contest was held in Tokyo. In this annual competition, launched in 2013 and held for the third time this year, sales staff from specialty stores competed over their makeup skills.

"The strength of cosmetics-only stores is that the customers can speak to the sales staff one-on-one to seek advice from them about which cosmetic products are suitable for them. This is a sales tactic that will always endure," said Naoki Murakami, a corporate officer of Shiseido.