P&G’s digital strategy pushes for Olay in China
In China, P&G is adopting the concept of C2M (Consumer to Manufacturer) and, with subsidiary Olay’s personalized skincare at the fore, is trying out a variety of endeavors, including popup stores and live commerce that utilize digital technologies.
Limited edition personalized skincare
In April, while China was in the midst of the coronavirus crisis, Olay began selling their skincare product “Olay Labs / Olay Skin ID” in the country before anywhere else in the world. The product, which is customized to users’ needs, was a limited edition sale, with only 5,000 available.
It was sold through Olay’s flagship store on the e-commerce platform Tmall. It works by first having users perform a skin diagnosis in the app by taking a selfie, while also answering a questionnaire related to their diet, sleeping hours, menstrual cycle, and other factors. With this data, their individual skin condition is analyzed via AI and a diagnosis report is shown. Then, based on these results, a custom mixture of ingredients is produced. These can include niacinamide, caffeine, vitamins, peptide, plant extracts, and hyaluronic acid. This results in made-to-order skincare suited to each individual user. Indeed, the 5-piece sets, which include a cleansing foam, skin lotion, beauty essence, face cream, and eye cream, are recommended from a total of 1,024 different combinations.
Olay Labs developed this skin diagnosis system together with Palo Alto Research Center Inc. (PARC), an American computer technology firm. It uses a patented technology that analyzes 68 points on the user’s face to detect their balance of melanin, collagen, keratin reproduction, water, and fat to better understand their skin condition and in turn realize higher precision recommendations. In addition, they’ve been able to improve the quality of skin analysis for users of Asian ethnicity by utilizing big data of up to a million skin samples from Asian people of a wide range of ages.
The price is in the higher range at US$300, however, their ad campaign featuring Japanese actress Ayaka Miyoshi with a futuristic vibe has proven effective, and recognition has also been gained on social media. When popular KOL (Key Opinion Leader) Rebecca de Yixiang Shijie (“Rebecca’s Whimsical World”), who has over 6.5 million followers on Weibo, tried out the made-to-order skincare in advance and posted about it, the post drew over 1,000 comments.
Popup stores offering immersive experiences
Olay’s endeavors haven’t just stopped there. From August, they opened up popup stores in various shopping malls across China, and in them were incorporated a variety of technologies.
These stores were essentially concept shops for the new product “Olay Pureset Supreme Concentrate” that was released in July. Based on the mechanism of autophagy that was recognized by the Nobel Prize in Physiology or Medicine, the product is a beauty essence developed using Olay’s original blending technology.
Olay Pureset Supreme Concentrate works by first having users follow Olay’s official WeChat account and enter in their personal information. Then at the popup store, they receive an ID tag and undergo a skin diagnosis. Their skin is quantitatively assessed and analyzed through several aspects, including pores, wrinkles, and damage from ultraviolet rays, and then a skincare solution that matches them individually is provided.
The skin diagnosis device in the popup stores is “NEXA”, which was developed by P&G along with US firm Canfield Beauty. The same device is also set up in Olay purchase counters in department stores across China. Other brands are also incorporating skin diagnoses into their stores and events, however, Olay’s popup stores also feature hands-on experiences. These immersive experiences include an area set up where customers put on white scientist coats and carry out experiments to gain an understanding of how autophagy works. Another feature is a corner where they can experience a self-cleaning effect on their skin via a virtual reality game.
Currently, in China, a business model called C2M, which stands for “Consumer to Manufacturer”, is starting to trend in the manufacturing industry overall, including the fields of auto, furniture, apparel, glasses, and home electronics. In C2M, manufacturers don’t keep inventory and instead manufacture products only upon receiving orders directly from customers via e-commerce. In this way, it bypasses the burdens of product storage and allows made-to-order products to be offered at low prices. The endeavors by Olay mentioned above adopt this new C2M model and are leading this trend in the beauty field in China.
Efforts also put into live commerce and online presentations
When they expanded into China, Olay was early in actively implementing digital technologies. Since 2017, they’ve had skin age measuring in their flagship Tmall store, and they also pursued live commerce from an early stage. These efforts proved successful, and Olay is currently seen as standing far superior over rival brands in this area, even on e-commerce.
Olay performed well at this year’s “618”, the event of a giant sale held each year on June 18th that spans China’s whole e-commerce industry, and during a month-long sale on their flagship Tmall store, Olay’s basic skincare products sold over 28,000 units according to local reports. Meanwhile, during a pre-618 sale on JD.com on June 1st, sales doubled from the previous year in just the first 10 minutes, and their beauty essence “Olay Danban Xiao Baiping” entered the top three sold on that day.
As of this year, Olay increased their staff numbers for handling 618 by over 30% and rolled out advertising on each platform that links customers to JD.com. They also conducted live commerce streaming for over 7 hours each day on JD.com during a sale period.
Text: Ching Li Tor
Original text (Japanese): Team Robboteer
