|dc.description.abstract||This thesis summarizes the work completed on an explorative research study of
the Chinese hand cream market. It has been written on behalf of the Norwegian
company Lilleborg, with the aim to find a suitable position for the company`s new
hand cream in this market. The thesis gives recommendations regarding the
Shanghai market as the primary findings, due to limited resources, concerns this
city only. The findings are not to be generalized as this is not in the scope of the
The Shanghai skin care market is growing and it is highly fragmented. The many
different players, both foreign and local, are generally positioned as either
luxurious; utilizing high- end distribution channels like exclusive specialty stores,
pharmacies and department stores, or positioned as medium- to low- end;
conveniently placing the products in a broad range of super and hyper markets.
Moreover, the competition is fierce and the industry is extremely brand driven.
Chinese young, urban consumers are getting more affluent and constitute the main
force of the beauty economy. They are becoming more discerning in their tastes
and making greater efforts to understand the heritage of individual brands. Many
high- end consumers in Shanghai perceive quality as the most important element
regarding hand cream, followed by price and brand. A high price symbolizes high
quality, as do a foreign branded product. Additionally, many consumers have a
relatively low brand loyalty towards their preferred products.
Lilleborg should enter the Chinese market by establishing a representative office
in Shanghai and tie up with a local distribution partner. The main focus should be
on brand building by creating a story behind the company and product, based on a
Nordic lifestyle and a “made in Norway” signature. Lilleborg should utilize
alternative, low- cost media channels and encourage to a positive word of mouth