Cosmetics are a strong seller these days, particularly at department stores.
According to a monthly report from the Japan Department Stores Association, overall sales at 219 department stores nationwide dropped in July below the same month in 2017 for the first time in two months, falling 6.1 percent due to bad weather, fewer Saturdays and other reasons.
In 10 major cities and other regions, all products except cosmetics failed to sell as well as in the same period last year.
In contrast, July sales of cosmetics accounted for 8.6 percent of total sales (513.2 billion yen), an increase of 5.3 percent from 12 months ago and the 40th consecutive month of growth. Cosmetics are the trump card department stores can rely on.
In 2007, sales of cosmetic products at department stores nationwide were 351.5 billion yen, accounting for 4.6 percent of total sales. In 2017, the figure increased to 512.2 billion yen, or 8.6 percent. A truly amazing feat when you note that overall sales have slumped from 7.71 trillion yen to 5.95 trillion yen over the decade.
So why are cosmetics selling so well?
First, they greatly benefit from consumption by tourists from overseas, who spent 27.2 billion yen in July, up 19.8 percent from last year and accounting for 5.3 percent of total sales at department stores. Most of the revenues apparently come from luxury brand products and cosmetics -- the main items purchased in bulk by Chinese tourists.
The second reason is that women of the so-called Line generation -- those aged from 22 to 26 who like to communicate via the Line messaging app -- have a surprisingly high interest in makeup. A recent lifestyle survey by Itochu Fashion System Co. on 2,000 women in this generation found that the top three things they want to spend their money on are fashion, makeup and body-skin-hair care. They may not be able to afford luxury brand clothes and bags, but they can still indulge themselves in Chanel, Dior or Saint-Laurent by spending about 50,000 yen on a full lineup of cosmetics by those brands.
The cosmetics floor of a department store is like Disneyland for them.
The third reason is that cosmetics have an edge over apparel in that they are expendables. Even among clothing items, innerwear, which is also an expendable, does not seem to be struggling as much as outerwear.
Also, cosmetics are never discounted. Although they were excluded from the resale price maintenance system in 1979, they are still not sold at reduced prices. This seems to have created a big difference from apparel, which has tarnished its own prestige by too many bargain sales.
Finally, compared to fashion and apparel, which can be called "mood-based products," cosmetics are relatively "scientific" products focusing on function and efficiency. I believe this is a key factor for consumers, who are being increasingly strict with their purchases, spurring them to put priority on cosmetics over other products.
With so many strengths, it's natural for department stores to expand their cosmetics floors to attract more customers, which is exactly what's happening this year.
Hankyu department store's Umeda main store in Osaka extended the existing cosmetics floor in March, calling it Hankyu Beauty World.
The Beauty Floor of Sogo Yokohama -- Sogo department store's Yokohama branch that reopened on Aug. 17 after refurbishment -- is one of the country's largest cosmetics floors, enlarged by 1.6 times from 2,800 square meters before its renewal to 4,400 square meters after. The number of cosmetic brands available increased from 45 to 70.
With a garden party as its basic concept, the space is decorated with green plants on the walls, and the light-filled ceiling is reminiscent of natural sunlight. It is indeed a Disneyland of cosmetics and makes one convinced of the great form of cosmetics floors at department stores.
Miura is the editor at large of WWD Japan.
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