The international group credits social selling with its successful transition to online sales during the COVID-19 pandemic.
L’Occitane International, a group that offers beauty products through its six brands, is pointing to social selling as the key to its successful pivot to online sales.
When the COVID-19 pandemic hit, L’Occitane’s retail sales took a drastic hit. Social distancing and public health concerns led the company to temporarily close 75% of its brick-and-mortar stores, leaving L’Occitane with a significant sales deficit and obstacles that are even more substantial in a category that relies on human interaction with the product for sales.
But in its annual report for the year ending March 31, 2021, L’Occitane credits social selling with its successful pivot to online sales and its resulting profit rebound. The company’s online channels expanded 69.2% and accounted for more than one-third of the group’s total sales. It was social selling, the report says, that enabled it to “maintain and strengthen its human approach to beauty despite the need for social distance.”
Of its six brands, L’Occitane revealed that LimeLife, its direct selling arm, was the group’s fastest-growing brand, posting consistent sales growth of 25.7% during the year. LimeLife’s online-only and social media-based model were some of its greatest strengths during the challenges of the pandemic and led to what the report describes as “solid profit contribution.”
“Our resilience and adaptability in the face of the incredible challenges of COVID-19 has seen our business blossom in terms of its development and profitability,” said Mr. Reinold Geiger, Chairman and Chief Executive Officer of L’Occitane. “This is a credit to the solidarity and passion of our teams around the world. While the impacts from COVID-19 may still linger, we expect online sales and sales in high growth Asian markets to remain robust. With the inherent strength of our brands, the determination and focus of our management team, as well as our targeted investments, we believe we have laid a strong foundation to accelerate growth and expand profitability further in the coming years.”
L’Occitane’s emphasis on social selling was seen most clearly in Europe, where it rolled out 68 social selling projects. The company’s overall net profit for the year increased 36.3% to a record €157 million.