China is a burgeoning market for luxury brands Coach
I had assumed that cosmetics companies would also benefit from China and other markets as consumers increase spending on non-essential disposable goods. After all, who ponies up big money for a snazzy leather bag and doesn't want her mug to be seen in the most favorable light as well? In today's The Nikkei, a Shiseido (OTC BB: SSDOY.PK) rep says a not inconsequential number of people, including many Chinese, aren't interested in cosmetics because they believe the stuff is bad for the skin.
In China's larger cities, Japanese cosmetic company Shiseido has done well and is growing quickly, but it is seeing the aforementioned disinterest in smaller cities and more rural areas. The same dynamic is likely to make things difficult for L'Oreal (OTC BB: LRLCY.PK), Revlon
My wife tells me some cosmetics aren't good for the skin, but that many don't do much harm -- even if they're not as beneficial as sometimes advertised. Still, I have to believe that competition among people to look good means that cosmetics will eventually be seen as a status symbol of sorts and catch on in places where they haven't yet. That makes this a trend worth paying attention to -- at least once Shiseido and others do a good enough job of convincing people they're not so terrible for complexions.
Related Foolishness:
- Emerging Market Musings: China
- 3 Reasons to Stay Long Chinese Stocks in 2007
- Unattractive Beauty at Avon
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Nathan Parmelee has no ownership stake in any of the companies mentioned. The Motley Fool has an ironclad disclosure policy.