Shiseido seeks growth in “critical” Americas region with Dr. Dennis Gross acquisition

03 Jan 2024 --- Shiseido adds American-based brand Dr. Dennis Gross to its skin care portfolio by purchasing DDG Skincare Holdings. Based in New York, the company is marketed as a “dermatologist-led, science-based prestige skin care” business that will be a “strategic addition” to its luxury skin care offerings which include Clé de Peau Beauté.

The brand was launched twenty-four years ago by former skin cancer researcher and practicing dermatologist Dr. Dennis Gross and his wife. It is known for its Alpha Beta Daily Peel Pads, pre-soaked with alpha and beta hydroxy acids, including glycolic, salicylic and lactic acids. The chemical peel’s two-step process removes dead skin cells and promotes a brighter complexion. 

DDG Skincare Holdings’ mission is “to make the difference in the lives of all people everywhere by helping them have healthier skin.”

Shiseido sees the acquisition as helping boost its bottom line in three ways:

Tapping into “doctor-led” skin care
Shiseido says the Dr. Dennis Gross brand will help drive further growth thanks to ”a growing interest in health and beauty as consumers increase their awareness of “skin health.” As a derma cosmetics, doctor-led brand Dr. Dennis Gross Skincare strengthens our position in a rapidly growing skin care segment. By tapping the great potential of the growing market in the US with its unique positioning coupled with a complementary fit with our prestige portfolio.”

Shiseido sees growth in doctor-led, derma cosmetics.Driving growth and profits in the Americas
The Japanese conglomerate sees the Americas region as “critical” and “strategically important.” It hopes the “acquisition of a high-growth, profit accretive skin care brand will contribute to the ongoing expansion of the Americas business…and enable us to diversify our geographical footprint while resolving the imbalances in our revenue streams.”

Bolstering innovation and synergy
The company sees “synergistic effects with Shiseido’s strengths, bolstering innovation and driving global business growth. With a philosophy rooted in research, dermatology and technology, the brand is said to be well aligned with Shiseido’s rich heritage in skin care, global platforms and R＆D capabilities.

“This alignment will support Dr. Dennis Gross Skincare to accelerate its next phase of growth. Together, we will be well positioned to capture opportunities in the rapidly growing doctor-led skin care market around the world.”

Expanding markets outside China
Since the acquisition was completed in the final week of last year, Shiseido does not see a “significant impact” on earnings for the fiscal period ending in December 2023 but promises to disclose updates concerning 2024 financial results “at an appropriate” time.

Japanese brands such as Shiseido are still trying to recover from steep losses posted in 2023. Last November, Personal Care Insights reported on Shiseido’s troubles as the company’s stock hit a 16-year low and slashed its full-year profit forecast amid slowing demand from China, where many consumers boycotted Japanese brands following the release of treated radioactive wastewater at Fukushima last summer.

Shiseido’s CEO also points to other challenges, including “rising prices and labor shortages.”  Masahiko Uotani hopes to “swiftly recover what we lost due to the pandemic and propel ourselves onto a strong growth trajectory once again.”

By Anita Sharma