Sephora eyes potential leadership reorganisation in China

Beauty retail giant Sephora, a subsidiary of luxury conglomerate LVMH Group, is reportedly considering a major overhaul of its operations in China. According to Bloomberg, the move comes as Sephora sets its sights on more ambitious sales goals in the future, necessitating the appointment of a new leader for the China region to better serve its VIP customers.

As such, the company is actively searching for a suitable candidate to fill the position of head of China this year and is also exploring ways to enhance services for high-end customers. While Sephora’s global revenue is projected to reach an impressive 14 billion USD this year, the Chinese market has witnessed slower growth due to fierce competition in the cosmetics industry. To counter this slow growth, management is reportedly seeking to appoint an executive capable of spearheading the brand’s expansion in this lucrative market.

Sources further revealed that Sephora’s leadership perceives the Chinese market’s commercial potential as immense, a pivotal factor in achieving the company’s goal of reaching 22 billion USD in global revenue within the next five years. Both Sephora and LVMH have yet to comment on the potential changes.

According to financial reports, Sephora’s retail business has been the second pillar of the LVMH Group after the fashion leather goods department. In the first quarters of 2022 and 2023, Sephora’s performance was a key driver of success, particularly in North America, Europe, and the Middle East.

However, the Chinese beauty market has undergone significant transformations over the past two decades, with an influx of international players vying for dominance. Local beauty companies in China have also grown stronger, making the competition stiffer for Sephora.

In light of these developments, Sephora faces new challenges and competitors in the Chinese market. Emerging beauty collection stores and local brands have gained traction with innovative product selections and marketing strategies, altering the dynamics of offline beauty retail. To maintain its competitive edge, Sephora is focusing on its exclusive high-end brand resources and services, targeting the high-end customer segment.

To adapt to the changing market landscape, Sephora has already taken several steps in China. It recently opened its first futuristic concept store in Shanghai, incorporating cutting-edge digital and intelligent technology services. Additionally, the company has adopted a more localized product selection strategy, launching the “Made in China” plan to support local high-end beauty brands.

While Sephora’s potential reorganisation aims to secure its position in the rapidly evolving Chinese beauty market, it remains to be seen how the retail giant will navigate these challenges and capitalise on its unique advantages to achieve its sales ambitions.


Join our newsletter