Walking into a pharmacy or department store in Thailand, one encounters many skin care products and cosmetics from a variety of brands on product shelves and at counters. Even convenience stores like 7-Eleven often have a limited selection of similar products.
With purchasing power rising among Thais, spending on beauty and personal care products has gained accordingly. And while the dominant players remain international brands from the US, Britain, France, Japan and South Korea, local brands have plenty of room to enter the fiercely competitive market.
Thatchanok Manorom, co-founder of Medica Viva, says the key to marketing skin care products is the ability to solve skin problems. Once the brand has shown its efficacy, it gains the trust of consumers.
"The brand is part of consumer trust, while pricing is a major factor in market competition, but a satisfied result after use is the best outcome for any brand owner," Dr Thatchanok says.
Two beauty gurus
At age 30, Dr Thatchanok is an expert in dermatology after earning a medical degree from Khon Kaen University. She used to work at aesthetics clinics, where she witnessed many skin problems among Thai patients for several years.
"They normally have freckles, blemishes and acne, which are very normal problems for Thais, but most of them have the wrong treatment and are using low-quality or unsafe products," she says. "When you are facing these problems, you should treat according to medical advice."
Dr Thatchanok's friend Niyada Leerahakan, also 30, is a researcher and developer of skin care products in a lab.
"We started this skin care brand around 2013-14 and got a lot of good feedback from our friends," Ms Niyada says. "I am a chemistry scientist, so when I test new skin care products in the lab I can gain new knowledge about chemicals or substances for skin care and cosmetics."
Ms Niyada graduated with a degree in industrial chemistry from the Faculty of Applied Science, King Mongkut's University of Technology North Bangkok.
The two friends launched their first skin care line under the Charme brand, with products aimed at treating sensitive skin.
Charme was unsuccessful in the business sense, however. Ms Niyada says 100,000 baht in monthly sales was typical, but the brand took a loss because the pair lacked a practical business plan.
Becoming known
Dr. Thatchanok Manorom
In 2015, the two co-founders rebranded to Medica Viva with a new business structure and better management. Dr Thatchanok says they started by building a customer base with a beauty consultancy in the first stage.
"We created the Facebook page to provide our advice and treatment for all skin problems," she says. "Many customers have been affected by use of steroidal skin care products, which cause rash, chronic acne and oily skin."
Dr Thatchanok says avoiding damaged skin from steroids is the duty of any doctor: "We will not force customers to buy our products only, but we will give our expert advice to customers on how they can apply the treatment to their existing skin care."
The Facebook page of Medica Viva has 235,400 followers. Dr Thatchanok says it receives about 100 inquiries a day.
Ms Niyada, for her part, is in charge of all R&D activity for the products. She says each product normally takes two years to develop before going commercial.
"As a scientist, I believe there are two key formulas in skin care: the base and the active ingredient, of which the latter is the most important in developing the product," Ms Niyada says. "New active chemicals for skin care are emerging all the time, and it's my job to provide updates on them and to test them until we've come up with a suitable product."
Medica Viva currently has about 10 products, mainly for skin care, with indications for treatment of and relief from freckles, blemishes and acne, as well as minimising pores and protecting against sun exposure.
Ms Niyada says Medica Viva reached 100 million baht in sales last year, marking an all-time high for the brand amid mounting and aggressive competition in the Thai skin care market.
Regional strength
According to Euromonitor International, Thailand is the largest market for beauty and personal care in Southeast Asia with a value of US$5.84 billion (191.6 billion baht) in 2017, up 6.8% from a year earlier.
Moreover, a potential niche segment for the country is in premium beauty and personal care, which reached $1.05 billion in 2017, up 7.8%.
Euromonitor said the 2017 performance benefited from an ageing population and tourist demand, while beauty retail has shifted towards multi-brand stores and the online platform.
Consumers are increasingly shopping for beauty and personal care needs at multi-brand beauty stores, which offer mass-market and high-end products in one shop.
"But multinational players lead the beauty and personal care in Thailand, which has a fragmented landscape full of international and local brands," Euromonitor said. "The market tends to become even more fragmented with a number of local brands entering the competition."
Euromonitor forecasts the country's beauty and personal care market to grow by 7.1% to $6.25 billion in 2018, driven by sophisticated demand and product offerings. Thailand is expected to remain the largest market in the region, topping more-populous Indonesia's projected $5.58 billion, an 11.6% rise.
By 2022, Thailand's beauty and personal care market is tipped to reach $8.53 billion baht, while Indonesia's will hit $8.44 billion.
The overall Asia-Pacific market in 2022 is forecast at $206.49 billion, up from an estimated $158.83 billion in 2018.
Overseas markets
Dr Thatchanok and Ms Niyada have set a goal for Medica Viva to maintain 20% growth in sales and customers.
"Skin care is now such a necessity among consumer products, similar to soap or shampoo, so we believe that there is room for local brands to be strong in the market," Dr Thatchanok says. "If the skin care market is worth 10 billion baht, we need just a 1% market share, which would mean huge penetration for Medica Viva."
As a local brand, Medica Viva can create a new dimension in the beauty market and open up consumers' minds to the notion that a local brand can solve skin problems as effectively as others available in the market.
Medica Viva markets its products through 800 dealers nationwide. Ms Niyada says the brand will continue to rely on the dealership channel.
"We will not sell directly to the buyers, but we encourage our dealers to connect with them; meanwhile, we train them on how to give skin treatment advice to buyers," she says.
The two co-founders also plan to penetrate other markets, with China as the first destination.
Dr Thatchanok says that after Medica Viva joined the Asean Beauty Show, "we got some potential orders from China and Great Britain, and 2018 is the first year that we are entering the overseas market".
The company plans to seek out distributors to market products there, she says.