There’s no compromise when it comes to beauty. That’s why beauty products often make a rapid recovery after most crises.
And for Ines Caldeira, CEO of L’Oréal Thailand, Myanmar, Laos, and Cambodia who has been in the industry for almost 20 years, the world of beauty extends far beyond the physical appearance — covering the sense of self-esteem and happiness.
Therefore, despite the COVID-19 pandemic over past 18 months, L’Oréal has managed to alleviate the impacts in the face of a sales decline and market contraction.
“If you take a look at the worldwide beauty market, the 2020 figure shows a contraction of 8%. In Thailand, it was worse than minus 8%. Our estimation is that the market probably contracted around 13%,” Ines said.
“Fortunately, L’Oréal Group has really outperformed at the worldwide level and also in Thailand. Very recent publications and official data show that the group last year ended minus 4%. That’s significantly better than the market.”
A major strategy L’Oréal has applied to maintain its leadership, especially in Thailand and other ASEAN countries, is technology.
Ines stated that when she arrived in Thailand three years ago, the regional market was already familiar with gadgets and online platforms, particularly social media like Facebook. So the pandemic is just speeding up the adoption of digital technology.
“The beauty market has indeed been transformed by digital technology and new business models. The last three years, especially the last two, have been particularly significant in that regard,” the CEO said.
“In early 2019, the way of e-commerce in this country was extremely limited. It’s now very close to 50%, which means the consumers have changed forever. Thai people love convenience. They like the idea of making a very good deal and of course they like to browse throughout thousands of SKUs and brands.”
Ines also said that thanks to digital technology, the company has been able to maintain its strong performance and close ties with consumers in the Thai market.
“We have been performing an amazing transformation. Digital e-commerce is now an everyday word in the mouth of my teams. We have gained significant market shares over the last three years and we have seen incredible adoption of beauty technology in the country.”
For the CEO, the pandemic has adversely affected the beauty market due to the changing consumer behavior. People socialize less, go out less, and apply make-up less as they have to wear masks all the time in public places, which directly impacts the sales of cosmetics and beauty products.
However, the beauty market finally is seeing light at the end of the tunnel, as more and more countries have exceeded the vaccination rate of 70%, including the United States, the United Kingdom, and Israel. The beauty market in many countries, mostly in Europe, are staging an extraordinary comeback.
“The desire was always there. And as people feel more confident because they are protected, they tend to celebrate life and make up for the moments they missed,” the CEO said.
“So I think next year will be the golden year of beauty in Thailand. So it’s going to be good. I hope the worst is behind us.”
During her past three years in Thailand, Ines has discovered what beauty means to Thai women and the fascinating world of beauty in Thailand. She said the country is a very innovative market where new brands are born every single day.
“It’s a very good mix between international brands and local brands — and fascinating consumers who are very sophisticated, especially when you compare with your neighboring countries in ASEAN.”
Meanwhile, what Ines has learnt from the Thai market is that technology is equally important as the consumer’s experience. This means consumers turn to digital technology not just for answers to their beauty queries or out of curiosity. But it is also because through L’Oréal apps, they are able to have fun, enjoy themselves, and do virtual try-on, which was not possible before.
The digital revolution allows L’Oréal a more direct connection with the consumer as well as a different experience.
“In the last three years, we were able to close the loop with a truly strong e-commerce strategy.”
Believing that the future tends to be about an acceleration of trends that existed before, Ines says digital technology and online platforms will involve and influence more in the beauty market, especially the way the brand relates to their consumers.
For instances, in the case of Thailand, social media addiction or connectivity was already there before, but the pandemic sent the trend to a higher level.
“I have seen a study by McKinsey. The new trends during COVID were very little. What we have seen actually was an acceleration of trends that were already there. We have seen many people making their shopping experience much more interesting because of digital [technology], because of virtual try-on that we have been pioneering, for instance. That’s going to remain,” the CEO said.
For her, something very interesting to watch is how brands react and adapt their marketing models to be close to the consumers.
“The household and the house now have a new meaning for the people. And because of digital [technology], staying at home is not necessarily boring anymore. So let’s see what the future reserves to us. I think it’s going to be really interesting to us, especially in beauty.”
Additionally, Ines views that digital revolution is just starting. The new wave is coming and the consumer’s curiosity and appetite for technology will only increase. L’Oréal wants to be at the forefront so over the past several months, the company has created partnership with Facebook, Google, and TikTok.
Also, L’Oréal is the first in the market and has been experimenting on live streaming and conversational commerce solutions.
“We want to pioneer all these trends, as leaders worldwide. That’s our mission. We will want to lead that arena as we have been doing so far,” the CEO said.
Another important point for L’Oréal, she added, is to deepen the understanding of its customers amidst the constantly changing world and rapid changes in the consumer behavior.
Finally, L’Oréal places the importance on sustainability, which is linked to the pandemic, while looking forward post-COVID, according to Ines.
The next step of L’Oréal is not only to create the beauty that moves Thailand and the world, but also to empower women through the world of beauty, the CEO says. As a woman leader herself, she said the role of women in this tech revolution is very relevant.
She is convinced that Thai women are highly well prepared for the tech revolution, both academically and professionally.
“If you go through the number, just to give you an example — L’Oréal Thailand. You will find a similar picture in Facebook and Google. They are dominated by women. Also, a lot of my e-commerce team are women,” she said, adding that the CEOs of Google and Facebook are women.
“For me, there is no reason why women cannot dominate this world. I think they are very well prepared and in a very strong position to really go far and beyond.”