Behind Perfect Diary’s high-end effort, it faces competition from many beauty and personal care brands.
Editor’s note: This article is from the micro-channel public number “radar Finance” (ID: radarcj), Author: Zhang Zhao Dan, Editor: deep sea.
On the evening of March 2, Perfect Diary’s parent company Yixian E-commerce announced that it would acquire high-end skin care brand Eve Lom. The acquisition is expected to be completed in the next few weeks. At present, the flagship cleansing cream in Taobao Eve lom’s flagship store is priced at 490 yuan for 50 ml, and 630 yuan and 980 yuan for 100 and 200 ml respectively. They are called “Hermes in the makeup remover industry” by some users.
In the public’s impression, Perfect Diary is a national brand that focuses on cost-effectiveness, and many products are called big-name “flat substitutes” by netizens. However, with the impact of similar brands such as Huaxizi and the peaking of the number of online fans, Perfect Diary sets its sights on the international market and tries to achieve market enhancement through brand upgrades. In order to become an international brand comparable to the global beauty giants, Perfect Diary previously announced that Zhou Xun will serve as the global spokesperson and reached an agreement with the French Pierre Fabre Group to acquire its high-end beauty brand Galénic.
Large-scale mergers and acquisitions and marketing have caused Perfect Diary to face profitability problems. According to the data, from 2018 to the third quarter of 2020, Yixian E-commerce achieved net profits of -40.124 million yuan, 75.359 million yuan, and -1.157 billion yuan respectively. Among them, the main reason for the huge losses in the first three quarters of 2020 is the sudden increase in marketing expenses.
In addition, Perfect Diary also faces competition from many personal care brands.
Some people in the cosmetics industry told Radar Finance that the acquisition of Eve Lom can broaden the perfect diary moat, but it will also consume the company’s cash flow. The long-term impact requires time to observe.
Perfect Diary’s parent company will acquire skin care brand Eve Lom
On the evening of March 2, Perfect Diary’s parent company Yixian E-Commerce announced that it would acquire the skin care brand Eve Lom. The seller of this transaction is Manzanita Capital. The latter will continue to retain a minority stake in the business and cooperate with Eve Lom. A strategic partnership was reached, and the acquisition is expected to be completed in the next few weeks.
It is understood that the Eve Lom brand was founded in London in 1985 by the well-known beautician Eve Lom.The star product cleansing cream, morning rejuvenating cleansing milk, radiant cleansing mask, hyaluronic acid moisturizing and repairing essence and other products are loved by consumers all over the world. In July 2015, Eve Lom opened an official flagship store on Tmall. The current number of fans is 689,000. Cleansing cream is its iconic product. The price of Tmall is 490 yuan/50ml, which is well-known in the domestic beauty circle.
Eve Lom is known for its deep brand foundation and efficient and exclusive formula. With its star products such as cleansing cream, the brand has a high level of consumer loyalty, and even during the epidemic, it has also shown strong sales growth. And profitability. Huang Jinfeng, founder, chairman of the board of directors and CEO of Yixian e-commerce, said: “We are very looking forward to the passionate Eve Lom team joining Yixian. They have experience in the international fashion and beauty industry. Yixian will work with the Eve Lom team to create the next A beauty brand with global influence in this era.”
In a statement released by Yixian e-commerce, Andras Szirtes, Managing Director of Manzanita Capital, said: “In the nearly 20 years since Eve Lom joined the Manzanita brand family, we have experienced its unforgettable growth journey together. . We are honored to witness Eve Lom grow from a niche brand to a global brand, with business in North America, Europe and Asia. We are very excited about the opportunity to cooperate with Yixian e-commerce. We firmly believe that Yixian e-commerce is in the Asian market The laid solid foundation, excellent e-commerce operations and extraordinary innovation capabilities will promote the development of the Eve Lom brand to a new level.”
For the acquisition, some industry sources said that the specific effect depends on the integration of the two parties. If the integration is not good, it will weaken the profitability of Perfect Diary.
The high-end advanced ambition of Perfect Diary
Yixian E-commerce was established in 2016. In November 2020, Yixian E-commerce was listed on the New York Stock Exchange with an issue price of US$10.5 and raised more than US$600 million. It became the first Chinese US company to be listed on US stocks. Makeup group. The company currently launched three high-growth cosmetics and skin care brands: Perfect Diary, Xiao Aoting and Wanzi Xinxuan, and acquired the well-known high-end skin care brand Galénic, forming a multi-brand brand in all categories such as cosmetics, skin care, and personal care. matrix.
The development of the perfect diary can be described as “speed of light”. Public information shows that in August 2016, Perfect Diary’s parent company Yixian e-commerce was born. In April 2017, the Perfect Diary brand was established. In August of the same year, it was launched on the Tmall flagship store. In 2018, “Double 11” became the first sales on Tmall. A cosmetics brand with a value of over 100 million, and will be listed on the New York Stock Exchange in November 2020. From entering Tmall to successfully listing, Perfect Diary only took 3 years. According to the latest data released by Forbes, Yixian e-commerce co-foundedMan and CEO Huang Jinfeng has also been among the world’s billionaires, with a net worth of approximately US$3 billion.
In the public impression, Perfect Diary is a national brand with a major price-performance ratio. The average price of its products is about 60 yuan, and many of the products are big-name “flat replacements.” However, with the development and growth of the domestic beauty market, domestic veteran Pechoin, Memfa Shijia, Xiangyi Bencao, and Huaxizi, Ju Duo and other similar brands are attacking its position as the “big brother of domestic products”.
At the end of 2019, the number of Perfect Diary’s fans on the entire network exceeded 20 million. President Feng Qiyao said that the number of Perfect Diary’s online fans has basically reached its peak. In order to open up room for growth, Perfect Diary sets its sights on the international market, advances towards high-end, and tries to achieve market upgrade through brand upgrades.
In April 2020, on the occasion of the third anniversary of the establishment of the brand, Perfect Diary replaced the brand LOGO with an interlaced LOGO commonly seen with luxury goods such as Chanel. At the same time, Perfect Diary launched its overseas official website, with Chinese, English, Japanese, Thai and other languages, and used the Southeast Asian market as its first overseas destination.
On October 19 of the same year, Perfect Diary announced the famous actor Zhou Xun as the brand’s first global spokesperson. Subsequently, the group announced that Troye Sivan, a super new generation popular singer in Europe and the United States, will serve as the Perfect Diary brand ambassador. Before Zhou Xun and Zhang Ye, the spokespersons of Perfect Diary, such as Zhu Zhengting and Luo Yunxi, were mostly young idol stars who took the traffic route. According to industry insiders, the change in the selection of spokespersons for Perfect Diary shows its ambition for global development. It is not reconciled to just being a big name, but is determined to become an international brand comparable to the global beauty giants.
At the end of October 2020, Yixian e-commerce reached an agreement with the French Pierre Fabre Group, one of the largest dermatology and care groups in Europe, to acquire its high-end beauty brand Galénic. Among them, the seller owns EAU THERMALE AVÈNE, DUCRAY, KLORANE, and RENÉ F