Coronavirus-hit Japan dumps high fashion for health and hygiene

May 26, 2020 | News On Japan

May 26, 2020 (Nikkei) - Japanese consumers are spending more on masks, cleaning products and personal sanitizers while sales of makeup and motion sickness medicine take a major hit.

Cosmetic companies are seeing demand plummet for lipstick, rouge and other beauty products as social-distancing becomes the new norm. According to Tokyo-based market research company Intage Holdings, on-year sales of lipstick fell 69.7% in the second week of May while cheek rouge dropped 47.4%.

"Skin care becomes more important as people take measures against infection," Masahiko Uotani, president of cosmetics giant Shiseido told reporters on May 12 at its earnings conference. The company sees consumers with sensitive skin using more skin care products due to increased mask usage.

Shiseido announced a 96% year-on-year dive in net income of 1.4 billion yen for the January-March quarter. The Japanese company has lately struggled with sales, especially in luxury brands popular with practically nonexistent Chinese tourists.

The company said it will adjust to the pandemic-ravaged landscape by focusing on skin care and e-commerce, prioritizing the former as it sees little change in skin care routines. According to Uotani, "Skin care does not diminish" despite the coronavirus, and "consumers are more interested than ever in ethical [consumption]." He said Shiseido will speed efforts to promote ethical behavior and health conscious products.

Consumer products maker Kao showed a 1% increase in net profit for the quarter ended March, thanks to surging sales of hand soap. But the Japanese company's cosmetics business saw a 12% drop in sales and 60% decrease in operating profit from a year earlier. Cosmetics comprise about 20% of total sales.

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