POLA pay off: ‘Super prestige’ brand’s 129% growth guides Pola Orbis to recovery

By Amanda Lim contact

- Last updated on GMT

Pola Orbis Holdings has rebounded on the back of high-end flagship POLA. [Pola Orbis]
Pola Orbis Holdings has rebounded on the back of high-end flagship POLA. [Pola Orbis]

Related tags: pola orbis, Japan, Luxury

Japanese cosmetics company Pola Orbis Holdings has rebounded on the back of high-end flagship POLA, which posted remarkable operating profit growth of 129.2% in the first half of FY2021.

POLA is a luxury skin care brand specialising in skin ageing and brightening care owned by POLA Orbis, which is also behind well-known J-beauty brands such as ORBIS and THREE.

The remarkable growth was attributed to the company’s efforts to increase its contact points in the growth markets of China and travel retail. The emphasis on overseas sales resulted in a strong 55% growth year on year.

The strong performance was largely driven to the brand’s investments in China, where the company has been working to grow its presence.

In the first quarter, both the brand’s brick-and-mortar and e-commerce channels grew in China, spurring sales on by 120%.

In the second quarter, POLA made its debut on Hainan Island, China’s duty-free shopping mecca, with plans to open five doors by the end of this year.

Sales of POLA in China surged by 96% year on year, contributing to the brand’s phenomenal growth.

Additionally, the brand benefitted from the company’s ability to adapt to the uncertain environment and pivot towards e-commerce.

POLA also drove interest with key launches, including the improved Wrinkle Shot serum, an approved wrinkle care quasi-drug, as well as a new brightening serum under the best-selling White Shot series.

Furthermore, the brand utilised digital solutions and configured tailored promotions to attract both new and old customers and maximise the annual lifetime value (LTV) of its customers.

Moving forward the company is aiming to sustain its success by reinforcing the brand recognition of its B.A line of products.

It is also planning to increase the number of stores in China from 58 to 70 by the end of 2021 to strengthen its retail footprint.

Furthermore, it will focus on online shopping festivals such as Double 11 to increase brand exposure and widen its consumer base.

POLA highs offset ORBIS lows

The increased gross profit achieved by POLA helped to boost the operating profit of the entire beauty division by 72.7% year on year.

Overall, Pola Orbis’s net sales for the first half increased 6.3% year on year to JPY89bn (U$ 812.8m), while operating income increased 54.7% year on year to JPY9bn (U$83m).

This offset the shaky performance of ORBIS, which recorded an operating profit decline of 29.3%.

In Japan, ORBIS experienced a decline in spending per customer due to a decrease in make-up demand.

Overseas, the brand was hit by the COVID-19 lockdowns in markets such as Taiwan, which constitutes a high proportion of its overseas business.

To strengthen the brand, Pola Orbis said it would take steps to enhance its presence and turn the brand over to become a highly profitable business.

It plans to focus on expanding its skin care customer base with a focus on the ORBIS U anti-ageing skin care series.

Last April, ORBIS launched the Wrinkle White UV Protector, a sunscreen that improves wrinkles and brightens skin.

Furthermore, Orbis has also launched a subscription service aimed at improving its customer retention rate, which in turn can help to improve LTV.

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