By Jessica DiNapoli
NEW YORK (Reuters) -Procter & Gamble has revamped its marketing and lineup of influencers for fast-growing Chinese shopping app Douyin in recent months, helping its Pantene shampoo lead hair care growth on the platform, executives said on Thursday.
The Cincinnati-based company’s investments in better packaging for Pantene in China, and improved marketing on how much to use, have led to online growth, Alex Keith, the company’s head of beauty, said at an investor day.
“We have been growing online market share for over a year now and our portfolio is leading the category growth of Douyin, the fastest growing online retailer in China,” said Keith. P&G’s beauty business accounted for about 18% of its $84 billion in net sales globally in the fiscal year ended in June.
Influencers on Douyin such as Ni Bi Yi, a young mother, and Chou Dan, known for her jokes, praise Pantene’s jasmine scent and its ability to restore their hair, according to posts on TikTok’s Chinese sister app.
P&G is looking for ways to boost sales in China’s sputtering economy, where sales fell 15% in the quarter ended September 30, dragging the entire company down with it. Even though P&G is seeing positive trends in hair care at Douyin, the higher-end categories in which the company competes in China have declined due to low consumer confidence, Keith said Thursday.
To rebuild sales, the company is offering more of its hair care and beauty brands on Douyin and other fast-growing e-commerce platforms, P&G executives told Asian investors in August, according to a bank research note.
It is also building brand houses on Douyin, such as the page for skincare brand Olay, and putting influencers on its payroll, according to the JP Morgan note.
These steps are intended to give P&G more control over its brand message as it faces competitors such as Unilever (LON:)’s Dove and local brands.
The note stated that SK-II was not on Douyin, but that the high-end brand, which faced major consumer rejection due to its Japanese roots, now is, according to a social media post.
SHOPPING VIA LIVESTREAM
Chinese consumers are increasingly shopping through the app, which offers livestream videos, and abandoning the brick-and-mortar stores where P&G has built its presence for decades in an effort to become essential in China’s growing middle class.
Influencers on Douyin lure shoppers with deep discounts, and consumers in China think they’re getting the lowest price on livestreams. P&G executives have said they are trying to balance this approach with the company’s long-term strategy to bring products to market that are worth higher prices.
At Olay’s Douyin store, influencers hosting livestream videos are offering 19.3% off a 260g body lotion this week, according to a Reuters review of Douyin. A whitening set, which lightens the skin color, is almost 30% off.
The consumer goods maker is now introducing a Head & Shoulders upgrade in China like Pantene’s, Keith said. Similar improvements are in the works for Rejoice, another hair-care brand, she said.
P&G also sells Olay through Chinese lifestyle app Xiaohongshu, which is popular among young women and often compared to Meta’s (NASDAQ:) Instagram, where product reviews can lead to purchases. Pantene, Head & Shoulders and Rejoice also have Xiaohongshu accounts, Reuters confirmed.
P&G is overhauling its marketing in China after losing its foothold in the country in recent years, first during the COVID-19 pandemic when shopping quickly moved online. Subsequently, Chinese consumers were disappointed with Japanese brands, including SK-II, which sells for $100.
P&G had spent decades building a presence in China, hoping to tap the country’s billions to buy everyday products like Safeguard hand soap, Tide detergent and Pampers diapers, especially as growth in developed markets such as the United States and Europe.
In the fiscal year ended in June, sales from China were 7% of P&G’s net sales, up from 10% of 2022 net sales of $80.2 billion.
Douyin is increasingly capturing market share from top e-commerce players Alibaba.com (NYSE:), which also has a popular livestreaming tool, and JD (NASDAQ:).Com.
According to JP Morgan’s note, P&G is hesitant to list its fabric care brands such as Tide on Douyin.
