According to Euromonitor, the Chinese sunscreen market was CNY 16.7 billion in 2021 and is predicted to reach CNY 20 billion in 2022. The recent hot weather further boosted sunscreen products’ expansion, implying that it is a large and fast-growing market to explore. However, a large market also means strong competitors. The truth is that many brands from international beauty giants have dominated the market, such as ANESSA, Lancome, L’Oreal, Shiseido, etc. However, surprisingly, Mistine, a brand from Thailand breaks the dominance of these big brands and even became one of the top 2 brands in the sunscreen sector.
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Initially founded in 1988, Mistine first entered the Chinese market in 2014, and reached CNY 1 billion sales after two years. The company’s sales remained rapid in the following years. In 2022 H1, its year-on-year growth rate reached 44 percent, even though the Chinese beauty industry was struggling as a whole. According to the latest data, its online market share also rose from 2.2 percent to 6.6 percent, ranking second and outperforming many big competitors, such as Lancôme and Shiseido.
Although investment in the Chinese beauty industry cooled down in 2022, Mistine was still able to complete its A round of financing in March 2022, securing over CNY 200 million, demonstrating the confidence that investors have in the brand.
Mistine’s Road to Success:
An experienced domestic team
Mistine has an experienced Chinese domestic team to operate its business in China. This team conducted a brand-wide redesign to make it fit the Chinese market while leveraging Thailand’s gene as a selling point. The head of its Chinese business has over 20-year experience in the Chinese beauty industry and is well versed in what Chinese consumers want from their beauty products. The team is also made up of members from big beauty and Internet companies, such as L’Oreal, Proya, Alibaba, etc.. As a result, they have experience or insights in operating a beauty brand in China, especially in the e-commerce and social era.
Playing the comparative advantages to develop ace products
In the early stage of the brand’s integration into the Chinese market, Mistine’s team conducted thorough market research about Chinese consumers and the latest market trends. Furthermore, the team combined the brand’s characteristics and competitive advantages to develop several popular products. The popularity of these preliminary products led to explosive traffic for the brand.
In 2018, Mistine gained its first exposure among young consumers because of its Strawberry Color Changing Lip Balm and Leather Pressed Powder.
Later, it further impressed more consumers through its sunscreen product line. Thai beauty companies already have a good reputation for their sunscreen products due to the country experiencing an annual average temperature of 35℃. Thai companies are known for their high standard for sunscreen products, including a higher SPF, a longer sunscreen duration, waterproof, sweat-proof, etc. Therefore Mistine’s Chinese consumers had a preexisting trust in their sunscreen products based on the perception of its powerful sunscreening efficacy.
Besides marketing its products from tropical regions, Mistine also redesigned its products for Chinese consumers’ specific demands. In 2020, Mistine upgraded its ace sunscreen products by adding a skincare function for Chinese female consumers. Based on the above strengths and innovation, Mistine’s products stood out from other strong competitors. Chinese consumers even give nicknames for its ace products, Little Yellow Hat (小黄帽) and Little Blue Hat (小蓝帽), an honor only awarded to those well-known bestsellers (e.g. Lancôme Little Black Bottle as 兰蔻小黑瓶 and Estee Lauder Little Brown Bottle as 雅诗兰黛小棕瓶). The popularity of these catchy nicknames further improve customers’ impression of this brand.
Also, this brand has a competitive advantage in prices. Its products are generally priced below CNY 100/unit, while most imported sunscreen products are priced over CNY 100 and even CNY 200. The low-cost, high-performance makes Mistine extremely popular among students and consumers who are more inclined to purchase affordable products.
Strong supply chain and distribution system
Mistine also has a strong supply chain. Its parent company, BETTER WAY group, owns a factory that produces beauty products for well-known companies such as Shiseido and Watsons. With more than 40 years of history, this factory also has the technology to process unique Thailand plant ingredients. Backed up by BETTER WAY, Mistine can take full advantage of the Sino-Thai supply chain to ensure product quality and iteration efficiency.
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Besides, Mistine adopted an omni-channel distribution strategy. Apart from Tmall and JD, the two mainstream e-commerce platforms, Mistine also covers other niche EC channels, such as VIP.com, Little Red Book, etc.
According to VIP.com, Mistine was the bestseller in the sunscreen category, with an over 400 percent YoY growth rate in March 2022. In the meantime, Mistine entered about 500 offline stores, covering high-end cosmetics stores and affordable cosmetics stores in lower-tier cities. As an affordable brand, this omni-channel distribution strategy allows Mistine to access as many consumers as possible and improve its exposure and sales.
(Written by: ChemLinked Research Analyst)