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Sephora chief executive officer Guillaume Motte has taken personal charge of its operations in China, the latest management shift at the LVMH-owned cosmetics retailer as it struggles to win over consumers in the world’s second-largest economy.
Alia Gogi, who was appointed Sephora Asia’s president in 2020, resigned near the end of last year for family reasons, and Motte began directly overseeing the Greater China region at about the same time, according to people familiar with the matter who asked not to be identified discussing private matters. The move underscores the importance of China to LVMH’s second-largest brand, they said.
Jenny Cheah, regional managing director for other Asian markets including Southeast Asia, India and Oceania, remains in her role, some of the people said.
The leadership changes are LVMH’s latest effort to revive sales and market share in a region seen as having significant growth potential. While Sephora is on track to achieve global revenue of €16 billion ($17.4 billion) in 2025, sales in Asia and especially China must pick up if the retailer hopes to hit its revenue target of €20 billion in about three years, some of the people said.
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Sephora declined to comment.
Though it is growing rapidly in the US and Europe, Sephora has been held back by intense competition and cultural differences in many Asian markets. In the past two years, it closed operations in Taiwan and South Korea, where it failed to compete with the dominant local cosmetics giant CJ Olive Young Corp.
In mainland China, Sephora has incurred millions of dollars in losses in its efforts to win customers. Last year, it cut hundreds of office and store staff just months after appointing former Nike Inc. Asia executive Ding Xia to run its Greater China business.
The brand has opened some 300 stores since entering China in 2005, but has struggled to grow market share, particularly after the pandemic when an economic slowdown pushed consumers toward cheaper beauty products. Home-grown Chinese beauty brands are also gaining popularity for being more suited to domestic preferences and for same-day deliveries.
Ding, who now reports directly to Motte, is leading a team that will focus on updating Sephora’s range of products in China, including identifying niche products and brands not easily found elsewhere, as well as featuring more Chinese home-grown brands on the shelves, some of the people said.
There are signs business is picking up, with foot traffic at Sephora China stores during the country’s Lunar New Year holiday and Valentine’s Day higher than same periods last year, according to a person familiar with the cosmetic retailer’s China business operation.
The retailer is also launching products in China via exclusive partnerships, including Rihanna’s Fenty Beauty and the Estée Lauder Cos. skincare brand The Ordinary, the person said.
The development of Sephora remains one of the priorities of LVMH Moët Hennessy Louis Vuitton SE founder Bernard Arnault, who said in January the retailer was one of the key drivers of growth last year.
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By Angelina Rascouet and Shirley Zhao
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LVMH’s Sephora Cuts Around 10% of Staff in China as Woes Deepen
The beauty retailer is laying off hundreds of staff in China as it seeks to revitalise its struggling operations in the world’s second-largest economy, while also seeing departures among senior executives.
