Sephora Greater China CEO Maggie Chan has stepped down after five years with the company. No successor has yet been named to lead the LVMH Group-owned beauty retailer in the Chinese market which has struggled to become a driving force amid strong competition and a softer economic climate.

It was reported as early as last July that LVMH was looking to overhaul its operations in China, which it first launched 18 years ago. The market is integral to hitting a Sephora target of €20 billion ($21.8 billion) in annual global sales in five years, up from an estimated €13 billion ($15 billion) in 2023.

The retailer is looking to win over more Chinese Gen Z customers against a backdrop of rising competition from local beauty retailers like Harmay, Wow Color, and The Colorist and a slower-than-expected recovery after the nation’s Covid-19 reopening. Sephora exited the Taiwanese market in May last year after just one year of operating an ecommerce storefront for the region.

Last summer, Sephora opened what it calls a “store of the future” in Shanghai, a special concept boutique that encourages more tactile play with products and includes dedicated spaces for makeup tutorials and skincare consultations. In November, it also brought its festival Sephoria to the city, the first year the event was held outside the US, attracting over 3,000 shoppers to its interactive 3-day showcase.

”Consumers are trading down and heightened promotions post lockdowns are conditioning consumers to wait to purchase beauty items until promotional shopping holidays,” wrote Jefferies beauty analyst Ashley Helgans in a note this past week. “We also have observed a shift from products to services within beauty spending, potentially making the category headwinds more structural vs. transitory.”

China beauty sales grew 9.7 percent year over year in December helped by an easy comparison last year. It improved from -3.5 percent year over year in November and 1.1 percent in October.

Sephora Asia is led by Alia Gogi, who last year installed Jenny Cheah as managing director of Sephora Southeast Asia, Oceania & Korea.

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