Tokyo, Japan
www.kao.com

Corporate Sales:

$12.8 billion

Beauty Sales:

$5.3 billion

Key Personnel:

Michitaka Sawada, president and chief executive officer; Katsuhiko Yoshida, senior managing executive officer, president, consumer products; Toshiaki Takeuchi, senior managing executive officer; Masumi Natsusaka, managing executive officer; Motohiro Morimura, managing executive officer; Yasushi Aoki, managing executive officer; Hideko Aoki, managing executive officer; Kozo Saito, managing executive officer; Yoshihiro Hasebe, managing executive officer.

Major Products/Brands:

Sofina, Kanebo, RMK, Molton Brown, Bioré, Jergens, Asience, John Frieda, Goldwell, Essential, Liese.

New Products:

Sofina Deep Shiny Eyes, Sofina Smooth Color Rouge, Molton Brown Black Peppercorn body wash, Molton Brown Bursting Caju & Lime Bath & Shower Gel, Kanebo-Sensai Cellular Performance Emulsion II-Moist.

Comments:

In-store beauty counseling and merchandising is a priority for Kao, which has plans to expand its services in department stores, as well as continue to grow its business outside of Japan. For the year, Kao reached $5.3 billion in beauty sales (41.3% of net sales). Personal Care increased 1% year on year, while Cosmetics remained flat.

Michitaka Sawada, president and chief executive officer, says the cosmetics industry remains “a challenge.” He said Sofina and Kanebo—the company’s two main beauty brands—face stiff competition from others entering the market. Thus, branding is critical, says Sawada.

With a mission to bring positive changes to everyday life and make a “significant impact on the global environment,” Kao says it strives to always innovate to improve products and packaging. One advance in 2016: the Raku-raku eco-pack refill that makes it easier for all consumers, from children to the elderly, to easily refill containers of shampoo and conditioner, as well as other liquids. Last fall, Kao established a new beauty research and innovation center focusing on Sofina and Kanebo.

Now in the midst of its mid-term plan, the company continues to refine its goals. By 2030, as it continues in its aims to establish a global presence, it plans to also establish a distinct corporate image—and achieve sales of 2.5 trillion yen (approximately $23 billion at current rates), including 1 trillion yen from outside of Japan. In building its business in China, Kao continues to focus on products designed with “area innovation,” such as products that appeal to Millennials and those with long-lasting properties to address the hot and humid climate.

Sales of skin care products and Molton Brown were strong in The Americas and in Europe.

2017 News of Note

In June, Kao announced that it would reorganize its domestic sales subsidiaries relating to the Consumer Products business, a move that includes two companies specializing in in-store beauty counseling. Both are planned for operation by January 2018. Kao and Kanebo companies will be combined.

Kao Corporation took Sofina iP, its new brand released in Japan in 2015 and the basic skincare line of Sofina beauté, completely updated in 2016, to Taiwan and Hong Kong for a series of launches in March 2017. A section at the Sofina counter of the Uni-President Department Store Taipei, was installed to offer customers fine-tuned counseling (personalized skincare advice etc.) based on the most advanced skin-analysis technology. Kao says it will also continue to reform Sofina overseas, following efforts in Taiwan and Hong Kong.