Karen Raghavan | The Beauty Market in China

Topics Discussed and Key Points:

● The dynamic between heritage brands and startups

● How consumption patterns for Chinese consumers change when purchasing abroad versus within China

● Comparing travelling Chinese consumers with travelling Western consumers

● Whether most big beauty brands need to have a dedicated travelling consumer program

● How COVID-19 has changed beauty brands and their marketing

● How the pandemic impacted retail

● Considerations regarding KOLs and KOCs

● How to market hero products versus new products

● All about VIPKid

● Addressing the “pressure cooker” environment around academic expectations Chinese parents have of their children

● Comparing the American and the Chinese school systems with regards to setting students up for success in the workforce

Episode Summary:

Today on The Negotiation, we talk with Karen Raghavan, a Brand and Business Development Consultant and Growth Advisor to both heritage beauty brands and startups. She is also the Vice President of Brand Development at natural ingredient company Purissima.

Karen is a member of Chief, a private network built to drive more women into positions of power and keep them there.

Years ago, it was incredibly difficult for a new company to gain traction in China. Observing this, Karen set out to discover what captures the minds of Chinese consumers.

She found that consumers travelled to neighboring countries such as Japan and Korea to take advantage of price differentials, while at the same time introducing new brands to friends and family back home. She also discovered that younger Chinese consumers tended to travel abroad individually while older generations tended to do so in groups.

Today, eCommerce has become an indispensable avenue for the majority of brands. It is important for a company to hone their brand messaging and create compelling content that helps them stand out and attract their ideal consumer amid a sea of countless brands competing within the attention economy.

Further, the barrier to entry has now been lowered, again thanks to the ease of access to eCommerce solutions. What remains to be seen is whether all of these new brands launched during the pandemic will be able to scale moving forward.

Finally, Karen speaks on the “pressure cooker” environment around academic expectations Chinese parents traditionally have of their children. She also gives her thoughts on how well the American and Chinese educational systems prepare students for success in the workforce.

Key Quotes:

“The Chinese have a very intentional purchasing behavior, where they will research the brands at length, research the products at length, research the pricing at length, then create a list per location, per destination, and even do a group buy.”

“I don’t think there needs to be a specific Chinese traveller program anymore. I believe that a lot of brands have gotten way more educated over the last few years on the China market and the Chinese consumer.”

“We’re still human beings at the end of the day; so, having somebody talk me through a compelling brand story or demonstrating how a product actually could solve some of my skin problems or makeup needs—it’s hard to compare that with an Instagram ad or even somebody showing me how to do it on TikTok.”

“Unless there is a structural change in how children and students enter university, that pressure cooker environment will remain.”