Johnson & Johnson steps up digitalization, innovation to further expand its presence in China

The consumer goods unit of the United States-based Johnson & Johnson will deploy more resources in digitalization and innovation to further expand its sales of skincare, oral and baby care products in China this year, said a senior executive.

The aim behind this move is buoyed by an enormous market with enhanced spending power, e-commerce platforms, detailed division of consumer groups and openness to novel ideas in the country, said Farrell Wang, managing director of Consumer Health at Johnson & Johnson China.

"Chinese consumers no longer only associate lifestyle and quality with many well-known brands. Pushed by the consumption upgrading and rise of homegrown brands, they prefer to purchase consumer products with healthy ingredients, practical functions and efficacy," he said, adding the company has already reached tangible result in developing digital sales channels and cultivating reliable national brands for domestic shoppers.

After it acquired Beijing Dabao Cosmetics Co Ltd, a major Chinese skincare product manufacturer, in 2008, Johnson & Johnson has not only enriched the product line of the Chinese brand, but also expanded its market presence from top and second-tier cities to lower-tier cities, counties and villages across the country.

Supported by a number of products such as eye essence, sun cream and facial cleanser, Wang said Dabao's sales revenue has tripled over the past decade and become a brand with over 2 billion yuan ($316 million) of annual sales.

Eager to enhance the brand resonance among domestic consumers and take more CSR (corporate social responsibility) practices, Wang said Dabao will provide financial support to China Dunhuang Grottoes Conservation Research Foundation to conduct restoration of cultural relics for Cave 331 of Dunhuang Mogao Grottoes in Northwest China's Gansu province this year.

The Mogao Grottoes in Dunhuang consist of 735 caves and 2,415 clay-colored sculptures, while its frescoes cover an area of 45,000 square meters. It boasts one of the finest collections of Buddhist art in the world and was listed as a UNESCO World Heritage site in 1987, according to information provided by Dunhuang Academy.

Given China's soaring demand for consumer health items, as well as its strategic importance, Wang said Johnson & Johnson will introduce more health-oriented innovative products into China in the coming years, aiming at making consumers healthier in skin, oral and hair to bring all-around outer beauty.

"China has become a promising market where Chinese and Western cultures converge and businesses from both home and abroad stand to thrive," said Guo Xin, a marketing professor at Beijing Technology and Business University.