AMERICAN direct selling cosmetics giant Mary Kay Inc is strategically placing itself in Malaysia to tap the Asean growth story.
“We are looking at Malaysia as a strategic market that can propel us into other booming Asean markets, namely Indonesia and Thailand,” said Mary Kay Asia-Pacific president KK Chua recently.
“We are not just looking at Malaysia from the sales perspective, it is also about the long-term strategic perspective. If we are strong in Malaysia, we can also jump into Indonesia because it has a lot of cultural similarities in terms of language, culture and genetic make-up. Indonesia is also very attractive, given the population push.”
Chua believes growth in Asean would be driven by the China-led Belt and Road Initiative (BRI), which focuses on improving connectivity and cooperation among Asian countries, Africa, China and Europe.
The policy is significant for China since it aims to boost domestic growth in the country, it is also expected to yield massive economic benefits to all countries involved, including Malaysia.
“I completely believe in BRI and once it is completed within the next 30 to 40 years Asean will boom more than ever. Asean will be the next China,” he said.
Chua is also eager to replicate Mary Kay’s China success story in Malaysia, where it currently holds the second highest market share of overall cosmetics market, only after global cosmetics powerhouse L’Oreal Paris.
“China has some 7,500 brands and has at least 25,000 new stock keeping units every year, so to be the second strongest brand there... I have to say that we have done quite well.”
Chua said this was possible because Mary Kay Asia was beyond “just a direct selling company” and was in fact a full-fledged beauty company.
“We do behave like a beauty company because in terms of products, research and development, packaging and brand building, we are on par with the best of them. The only difference is that our channel of distribution is via ladies selling it from their homes versus sales in a retail shop or online,” he said.
According to Chua, the group had employed some 135 information technology engineers in China to develop mobile apps, as more and more sales were coming from those shopping online or via their mobile phones.
“We believe very much in the mobile technology in the time to come and I also believe the market between online and brick and mortar are merging now. Things are being sold on the Internet, but it still needs that human touch and I have a lot of that.”
Mary Kay Malaysia currently has some 60,000 active beauty consultants. Chua is targeting to add at least 30,000 more by 2020.
“Looking at the trend of big e-commerce companies like Alibaba and Amazon.com, they are actually looking from online to offline because they are beginning to realise that online alone is unsustainable. At the end of the day, the customer still needs the personal touch,” said Chua.