While larger cosmetics brands in China have embraced e-commerce for the past decade, a number of smaller companies have sold their products exclusively through retail outlets. As the COVID-19 outbreak has decimated bricks-and-mortar consumption, these brands are giving online sales a second look.
Online Sales and Streaming Boost Forestcabin’s Sales 45%
One success story is Forestcabin (Linqingxuan / 林清轩) a mid-sized Chinese cosmetics brand with 337 offline retail outlets. According to an article in China Daily, the company was predicted to see revenue decline by 90% year-on-year, due to the Coronavirus outbreak. Instead, the company quickly opened online stores and saw a 45% increase in sales from February 1 to 14, compared to the same period in 2019.
On February 14, Valentine’s Day, Linqingxuan’s CEO hosted a two-hour livestream on Taobao with 100 beauty advisors. During that livestream, alone, the company sold 400,000 RMB worth of products.
CEO of 林清轩(Linqingxuan) 孙来春(Sun Laichun) appears on live stream to market the products | Source: Taobao live streaming
Selling Online in China Becomes Easier
E-commerce platforms recognize the opportunity and have taken steps to make it easier for brands to begin online sales. Taobao announced that it will provide complimentary listings and live streaming support to small-and-medium-sized brands that want to sell on the platform.
Kwai, a live streaming platform, has also loosened its requirements for entry and provided fee waivers to encourage the transition from offline to online. Platforms such as JD.com, Tiktok, VIP, and PDD also announced their own measures to help bring new brands online.
“Once companies make the investment to move sales online, and also see the positive benefits to their sales, it’s unlikely they’ll reverse course after the COVID-19 outbreak is just a memory,” said Holly Kim, head of MeasureChina’s data business.