Istyle Inc, a Tokyo-listed beauty company, has entered a joint venture with Siam Piwat Group, the operator of Siam Center and Siam Discovery, to tap into Thailand's 320-billion-baht beauty store market.
The joint venture, Istyle Retail Thailand Co, was recently formed with registered capital of 100 million baht to run @cosme, a multi-purpose beauty store, in Thailand.
Istyle Inc holds a 70% stake in the joint venture company while Siam Piwat Retail Holding Co, a subsidiary of Siam Piwat Group, owns the remaining 30%.
The first @cosme store will open in 300 square metres at Iconsiam shopping complex on Nov 2 this year, with an investment cost of 20 million baht.
Initially, about 80% of beauty products available at the store will be Japanese. The company will expand its business online and later increase the selection of non-Japanese products in-store.
The @cosme store at Iconsiam will open as the first store in Southeast Asia. The company plans to open another four @cosme stores in Thailand over the next three years, including one at Siam Center, anticipating sales of 300 million baht.
Kei Sugawara, chief financial officer of global Istyle Inc, said during a visit to Bangkok yesterday that Thailand would be a priority country for @cosme store.
"Thailand's beauty market is the biggest in the Asean region," Mr Sugawara said. "Thai people love to look good, and beauty spending here is about 1.5 times higher than in Singapore and the highest in the Asean region."
He said Thailand's beauty market has segments with various purposes, indicating that the beauty market here is very dynamic.
More importantly, Thailand offers a huge opportunity for the @cosme store here, given that the value of Japanese cosmetics imported from Japan to Thailand makes up just 2% of all cosmetics, compared with 8%, 12% and 14% by Taiwan, Singapore and Hong Kong, respectively.
Istyle Inc was founded in 1999 to manage beauty-related portal sites as well as provisions of advertising, marketing and research services. Its business involves deals with domestic and overseas marketing, plus premium membership services.
The company also manages domestic cosmetics and e-commerce sites in addition to the @cosme store.
Hajime Endo, senior vice-president of beauty service at Istyle Inc, said Istyle has expanded its business outside of Japan since last year via the e-commerce platform.
The company holds major and minor stakes in investments across Asia, including in South Korean, Taiwan, Hong Kong, Malaysia, Myanmar, Singapore and Indonesia.
"@cosme has over 14 million consumer reviews covering some 300,000 items across 32,000 brands and provides an incredibly rich and reliable source of information for all consumers," Mr Endo said. "We make use of their data to create a sales floor. This makes @cosme unique compared with other beauty stores available in the market."
There are 25 @cosme stores in Japan. The company opened its first overseas store in Taipei in May 2017, and in the last 15 months it has opened a total of four @cosme stores in Taiwan and Hong Kong.
Usara Yongpiyakul, chief executive of Siam Piwat Retail Holding, said the @cosme retail concept merges online consumer engagement with offline sales, which is extremely innovative and exciting for Thai consumers.
Moreover, the @cosme business will further strengthen Siam Piwat's retail portfolio and generate additional opportunity to diversify growth apart from expansion of the core business.
Istyle's e-commerce and in-store sales were worth US$120 million (4 billion baht) last year. Of the total, more than $20 million came from e-commerce and over $90 million came from @cosme stores.