However, Liushen has established a powerful national brand image with its striking localization of brand culture connotation.
Company Introduction: Shanghai Jahwa is the longest history cosmetic company in China, whose main business turnover exceeds 3 billion yuan per year and whose profitability repeatedly ranks first among its peers. In the recent three years, Shanghai Jahwa has maintained more than 30% increase in annual sales revenue and become one of the largest cosmetic companies in China. The first two-in-one shampoo, the first can of hair styling mousse, the first compound perfume, the first hand cream etc., all these series of daily chemical products with modern meanings originate from Shanghai Jahwa. The company owns two well-known trademarks (unique domestically) in cosmetics - Merries and Liushen, as well as other famous brands such as Qinfie, Lumei, Gaofu, Herborist, Shuxin, Piaoshua, etc.
In the face of the strong foreign competitors who are coming fiercely, Liushen has grasped the special taste of Chinese consumers and their trust in traditional Chinese medicine culture. Based on this product unique positioning - bathing lotion with Chinese herbal ingredients, Liushen has built itself a strong market differentiation. Under the strong attack of multinational companies such as Procter & Gamble and Unilever, the strategy of Liushen bathing lotion has made a beautiful interpretation for how Chinese local companies use local advantages.
Liushen or Six Gods, is the name of a traditional Chinese medical prescription used to treat prickly heat and other summer diseases, whose major ingredients are pearl powder and musk. According to this prescription, in 1993, Shanghai Jahwa launched Liushen Florid Water for summer use. With clear product appeals of "anti-prickly heat and itching" and "refreshing", this brand quickly won 60% of the market share of florid water.
Since the end of the 20th century, international well-known daily chemical groups have begun to regard the Chinese market as one of the emerging profit sources. They have been dominating the Chinese market with their mature product systems, advanced marketing promotion methods, and strong financial guarantees. For a time, the shelves of stores were filled with products from companies such as P&G, UNILEVER, KAO, etc., and consumers were proud to use these imported brands; while national brands gradually disappeared under the strong competitive pressure, some became acquisition targets of foreign groups, and the remaining ones mostly struggled to survive. In the shower gel market, P&G's Safeguard and Unilever's Lux became shining stars.
Two years later, Shanghai Jahwa launched Liushen Shower Gel, specifically targeting the Chinese summer personal wash and care products market.
The launch of Liushen Shower Gel was, on the one hand, based on the already existing strong brand effect of the Liushen brand, aiming to maximize the value of the Liushen brand; on the other hand, facing the challenge of multinational companies, Shanghai Jahwa grasped the special taste of Chinese consumers who trust traditional Chinese medicine in some areas. After analyzing the consumer group, Shanghai Jahwa launched Liushen Shower Gel, aiming at the users of Liushen Florid Water and long-term favorers of traditional Chinese medicine products.
Although multinational companies have impressive strength and prominent brands, they lack understanding of the tastes and needs of local consumers. Moreover, in order to maintain the standardization of global operations, they mainly consider the needs of developed markets in product design and cannot provide products that meet the localized needs of emerging markets according to local consumer preferences. Their main target customer groups are urban residents who pursue fashion. Take young people in mainland China as an example, they often show high enthusiasm for everything Western. Shanghai Jahwa did not compete with foreign manufacturers for this market segment but focused its sales on a larger field: loyal customers who firmly believe in the functions of certain traditional ingredients, and provided relatively low prices.
Local Brand Culture Successfully Blocks International Brands
Daily chemical products are a product category with relatively high emotional added value, which means that consumer needs have diversified and personalized characteristics. Through brands, it reflects the functional benefits and emotional benefits that consumers are concerned about, reflecting the value, culture, and personality of the product.
After the product was launched, it soon won the majority of Liushen Florid Water users. By 1998, it had occupied the largest market share in the gradually established shower gel market in China, making Liushen Shower Gel the first brand of summer personal wash and care products in China.