9 minute read
Tackling the Thai hair beauty market with innovation, quality and competence
Dheerasak Tridhip
With a humble beginning in 1876 in Germany with their first product a laundry detergent, Henkel has come a long way in establishing itself in the cosmetics and beauty industry. Now with a legacy spanning more than a century, the German conglomerate has reinvented personal care and beauty, and made history as a pioneer in innovation and style as well as expanding to various countries. Its Schwarzkopf brand has been globally known ever since and is well positioned in Thailandâs consumer market for hair beauty since 1956. Its broad brand portfolio includes hair care, hair styling and hair colouration, with several local brands such as Schwarzkopf Freshlight, Schwarzkopf Taft, Schwarzkopf Natural & Easy and Schwarzkopf MEN SUCCESS, as well as Schwarzkopf Professional for hairdressers and stylists working in salons.
GTCC UPDATE Magazine is pleased to interview Mr. Dheerasak Tridhip, General Manager, Henkel Consumer Brands Thailand, to explore the company's ground-breaking approach to beauty, innovation, to sustainability and outlook for the future of the sector in its approach to tackle the Thai market, as well as ASEAN markets.
Please share with us background information of your company since its establishment in Thailand. What opportunities did Henkel see in entering the Thai market?
Henkel Thailand celebrated its 50th anniversary in Thailand last year. The company will continue to drive purposeful growth in the Adhesive Technologies and Beauty Care markets with its trusted brands and high-impact solutions.
Established in 1972, Henkel Thailand operates the Adhesive Technologies and Beauty Care business units and has approximately 510 employees across four sites in the country.
These include an office in Bangkok, two plants and a smart factory in the Eastern Economic Corridor.
For the Adhesive Technologies business, Henkel Thailand offers customers a competitive advantage through its integrated, total value-chain solutions of adhesives, sealants, and functional coatings for a wide and growing range of industries, including automotive engineering, electronics, food and beverage, furniture, sports and fashion and medical technologies. Its key brands include Loctite, Bonderite, Technomelt, Teroson and Aquence.
Meanwhile, Henkel Thailandâs Beauty Care business includes both Professional and Consumer segments, where it leads with innovations in the fields of hair colorants, hair perm, hair care and hair styling. We are driving a multi-category consumer brands platform representing a wide range of products and well-known brands including Schwarzkopf, Schwarzkopf Professional, JOICO and ZOTOS. We also strive to meet consumer needs by driving innovations with iconic brands and technologies.
The recent acquisition of Shiseidoâs Hair Professional business in Asia-Pacific is an expansion of Henkelâs portfolio of established brands, which include Igora Royal, Osis, Syoss, Freshlight and got2b. Globally, Henkel has merged its Beauty Care and Laundry & Home Care business units to form Henkel Consumer Brands.
How has your company evolved since its start in Thailand? Did you have to overcome many challenges in the beginning?
Good progress was made during the past 50 years, before I joined the company. The Beauty Care business has gone through many changes. We did not have many employees in the Beauty Care business 51 years ago as Henkelâs main business at that time was Adhesive Technologies.
Schwarzkopf has already been established for about 120 years. It entered the Thai market in 1956 and was taken over by Henkel in July 1995.
How does Henkel adapt the company's consumer brand portfolio, especially in the hair care and beauty segment, to meet the preferences and needs of the Thai consumers?
Henkel Thailandâs Consumer Brands business includes both Professional and Consumer segments, where it leads with innovations in the fields of hair colorants, hair perm, hair care and hair styling. In addition, We apply customer- and consumer-centric models, to drive the entire Henkel Consumer Brands portfolio through innovation, hair education, customer engagement activities and the community of Thai hairdressers in the market.
The Schwarzkopf brand, which is among the worldâs three leading suppliers of Professional hair products, is familiar to Thai consumers as its products have been available since 1956. At Henkel, we strive to meet consumer needs worldwide, and work on understanding and anticipating trends. We develop and co-create campaigns with our global and regional teams â to leverage and build global-to-local brand experience to Thai consumers.
In March 2023, Henkel opened its very own "J-beauty innovation hub" in Tokyo to focus on developing premium brands and drive innovations in Asia for Asian consumers. The hub brings together experts from different nationalities and allows a unique fusion of Asian and Western beauty concepts, trends and solutions for Asian salon partners and consumers.
What are the differences in Henkelâs branding strategy for the consumer brands?
We localise our branding strategy to suit the Thai market, by focusing on the local market potential, segmentation, trends, needs and, most importantly, market preferences. For example, in Thailand, we developed an easy colour shampoo which is specifically created for Thai consumers, reinforcing our âthink globally and act locallyâ philosophy.
Via our key salon partners, we initiated a brand-to-brand activity to escalate our expertise in the Hair Professional segment âthrough both Schwarzkopf Professional and Shiseido Professional. Both frameworks have blended our Western and Asian portfolios through service innovation, customer engagement and educational programmes.
We have two distribution channels as there are different applications of the products, thus requiring targeted go-to-market strategies. For the Professionalsâ segment, we engage hairdressers and prosumers (consumers who purchase products for professional use). For the Consumersâ segment, we engage them directly through channels like supermarkets.
Did Henkel Consumer Brands unit well perform during first half of 2023 and how about hair business performance in first half of 2023?
We also made good progress in implementing our strategic growth agenda in the first six months of the year. In the Consumer Brands business unit, we are advancing the integration faster than planned. At the same time, we are consistently sharpening our portfolio towards high-margin and highgrowth brands and products. This is also reflected in the earnings of the business unit.
The Consumer Brands business unit generated sales of 5,365 million euros in the first six months of 2023 (Q2: 2,594 million euros). The Hair business achieved an overall organic sales increase of 7.9 percent in the first half of 2023 (Q2: 6.1 percent).*
Back to the Thai market, could you elaborate on collaboration/partnerships that Henkel has engaged in the cosmetics or hair care industries?
Henkel Consumer Brands Thailand business includes both Professional and Consumer segments.
For the Professional segment, where our end-goal is to strengthen the salon business and hairdresser partnerships through education and inspiration, and continues to act as the essential resource for those hairdressers in the industry. For the Consumer segment, our goal is to build hair beauty experiences to Thai people through our innovation, beauty education, strong and engaging experiences and digitalisation.
To engage and inspire professionals in the hair industry in Thailand, we run an annual hair competition, deployed from our global and regional competition campaigns such as the Schwarzkopf Professional Hairdressing Awards and the newly-established Shiseido Professional Beauty Innovator Award. The competition aims to inspire hairdressers with upcoming trends around the globe and provides the technical skills needed to sharpen their hairdresser and business skills. The winner of this competition will have international exposure and build hairdresser skills and inspires the trends in our global and regional hubs in Germany and in Japan respectively. We believe that their success is our success. That is our philosophy.
Henkel Thailand also oversees the Cambodia and Myanmar markets. How do these two markets perform?
We operate in Cambodia and Myanmar via exclusive distributorship model. We believe there are strong opportunities to grow further, especially in Myanmar.
What will be the key trends in the next five years for the hair care industry? How do you plan to seize the opportunity to utilise such trends?
In recent years, we have observed that Thai consumers are starting to pay more attention to their styles and physical appearance since they are progressively returning to their workplaces and resuming social activities following the COVID-19 pandemic.
Since the COVID-19 pandemic, e-commerce has become one of the key channels for beauty sales in Henkel Thailand, which also explains our distribution/channel strategy of offering our products through platforms such as Lazada and Shopee.
In addition, physical and brick-and-mortar stores play an important role in reaching out to our target consumers. Thus, we are also partnering specialist health and beauty stores such as Watsons to enhance the in-store experience for product browsing and getting advice from sales associates.
Additionally, social media channels like TikTok and Instagram continue to provide beauty inspirations to our consumers.
Understanding the above, we need to keep up with these changing consumer trends and behaviours, and review our market strategy to be in touch with the Thai market.
Sustainability and ethical practices are becoming increasingly important in the beauty and cosmetics industry. How does Henkel address these concerns in its operations and product offerings in Thailand?
Sustainability is a central element of Henkelâs business strategy. The company has long been committed to its leadership in sustainability and launched a new global 2030+ Sustainability Ambition Framework last year.
To support achieving climate-positive operations by 2030, Henkel Thailand has installed solar panels on the roof of its plant in Chonburi, and continually explores ways to reduce energy and water consumption and waste generation at all its sites.
At the same time, Henkel Thailand promotes circularity by developing sustainable packaging solutions. For example, packaging innovations for Schwarzkopf and Syoss products include recycled paper boxes, and new bottle and cap designs that require less plastic. In collaboration with its hair salon partners, Henkel Thailand has launched an initiative to collect the used bottles of hair colouration products for recycling.
Over the years, Henkel Thailand has been actively contributing to the community. In March 2022, the company donated approximately 2.3 million baht (64,000 euros) to Taksin Hospital Foundation through the Fritz Henkel Stiftung charity foundation. The funds helped to build two Respiratory Care Units and obtain medical equipment to treat COVID-19 patients. Henkel Thailand employees also donate blood twice yearly to the Thai Red Cross Society and donated more than 10,000 euros (395,000 baht) to the Thai Red Cross Society to support medical workers in 2020.
Are there any specific regulations or standards in Thailand's cosmetics industry that Henkel adheres to? And how does Henkel ensure these compliance standards and maintain quality control?
We comply with the Thailand Food and Drug Administration (FDA) high standard regulations and our global compliance standards.
*Source: Henkel raises sales and earnings guidance for 2023 <https://www.henkel.com/press-and-media/ press-releases-and-kits/2023-08-10-henkel-raisessales-and-earnings-guidance-for-2023-1879994>
Contact details:
Dheerasak Tridhip
General Manager, Henkel Consumer Brands Thailand
Henkel (Thailand) Limited
