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Business / Companies

L'Oreal seizes the day in China

By Shi Jing in Shanghai (China Daily) Updated: 2015-12-07 07:58

L'Oreal seizes the day in China

Alexis Perakis-Valat, chief executive officer of L'Oreal Group in China.[Provided to China Daily]

From reading local detective novels to learning to speak Mandarin, CEO Alexis Perakis-Valat is always curious

Alexis Perakis-Valat reads Qu Xialong's detective novels, has bought photographys from Yang Yongliang and has moved from his Greek roots to speaking fluent Chinese.

This is all part of a world view that has allowed him to ramp up sales of cosmetic and beauty products for France-based L'Oreal Group in China and understand a country that does not stand still in opportunities and challenges.

L'Oreal sells Kerastase shampoo, iconic makeup brand Lancome, Giorgio Armani perfumes and in September launched the Men Expert Hair range.

The market of more than 1 billion people in China is the second largest next to the United States for Paris-listed L'Oreal and that makes Perakis-Valat's five-year run so far as country CEO a race to stay ahead.

"What is dangerous sometimes in China is not to foresee the right change," he said. "We have transformed the company and the digital agenda is everywhere. That is something we have done collectively. As a multinational company, we have been one of the fastest."

The move to digital is part and parcel of the company's ability to adapt in China during the past 18 years. On a personal level, the affable executive talks about Qu's Chinese detective novel Red Qipao and the stunning photography of Yang that meshes the mountain landscapes of Chinese traditional painting with urban blight.

His ability to speak in simple Manadrin at gatherings also shows an easy public manner. "A basic but friendly conversation in Chinese will help put everybody at ease and successfully break the ice," he said.

This all feeds into a curiosity about people and places that lead him to challenge himself often, especially because China is "such a fast moving business environment."

But that also feeds into his adopted personal motto "higher, faster, stronger" from the modern Olympics, which did not coincidentally originate in his native Greece.

"What is more interesting is the underlying new changes in China and how we react to them. The first change is new consumers. Understanding them makes sure our brands keep very cool and relevant for the young generation," he said.

Curiosity about China extends into homes as well. Perakis-Valat explained that L'Oreal has a regular program of selecting households in first tier and lower tier cities.

The company then sends employees to visit and pick up detailed information on product use, such as facial masks, or how young people have changed their media habits.

"I'm Greek originally, but grew up in France and things have moved on. Since the beginning, I have tried to understand where I was living and what the rules were," he said.

"That has helped me to be curious. Curiosity is a very important skill in China, because I have to listen, watch, and connect the dots."

On a national scale, that has meant dealing with the fallout from a slower GDP growth rate which has had a related effect on sales of fast moving consumer goods.

"Now is not like what its used to be three or four years ago," he said.

Still, L'Oreal made a bet a decade ago to open a research and innovation center in China and that has paid off. At the time, there were concerns that intellectual property rights from research and innovation would be easily copied.

But that has not been borne out and the R&D center has raised the company's standing in line with changing policy goals. Perakis-Valat, for example, noted the "new normal" is about quality of growth, rather than growth at any cost.

"Second thing, there is growth and wealth everywhere in China. When I arrived here we had Lancome in about 40 cities. We have just opened our 100th city in September in Baoji next to Xi'an," he said.

Perakis-Valat is also quick to praise the 4,500 employees at L'Oreal in China. "There are basically two things that will make you satisfied.

"First is that the company grows and gains more market share. The second is that you see people that you have invested in have grown proportionally," he said.

But, of course, there have been days in China that he found really hard to get through. At such times, he reminded himself of the last sentence of the movie Gone With the Wind-"Tomorrow is another day."

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