Do Day Dream’s resilience
The company is deploying a new campaign to reassert the brand among consumers, writes Pitsinee Jitpleecheep
Amid police crackdowns on the marketing and sales of substandard and unlicensed cosmetic and food supplement products, SET-listed Do Day Dream Plc, the maker and distributor of Snail White skincare products, has never wavered.
The company is rushing to organise a campaign to regain consumer confidence, inviting media from Thailand and China to Do Day Dream’s factory at Rojana Industrial Estate in Ayutthaya province this month to inspect the production process.
The campaign comes despite chief financial officer Piyawat Ratchapolsitte’s insistence that the company saw only a slight impact from the clampdown on the marketing for substandard and unlicensed cosmetic and food supplement products that began in April.
“Our factory is one of 153 factories that have been awarded the Good Manufacturing Practice (GMP) from the Food and Drug Administration (FDA) from over 10,000 skincare factories in Thailand,” Mr Piyawat says.
Nonetheless, he acknowledges that sales of Manu Life Snail White may not reach 30% growth as earlier expected, due to delay in beginning sales in the Chinese market.
“We are adjusting our new product packaging to meet the requirements of the Chinese FDA after gaining approval early of this year,” Mr Piyawat says. “The adjustment saw lost sales opportunities for two months.”
But he says the approval from the Chinese FDA also benefits the company, as it will make the company’s products easily accessible not only to the mainstream online platform but also offline channels where the market size is much bigger than cross-border e-commerce.
With proactive marketing campaigns in the second half of this year, the company is confident that sales will reach 2.17 billion baht this year, up from 1.67 billion in 2017.
To achieve the goal, the company will launch four new products to the market in the second half of this year and will appoint a new distributor to market its products in the Chinese wholesale market.
The company recently appointed SinoPacific Trading Co to distribute Snail White through traditional trade channels. On top of that, it secured an agreement to sell Snail White products in the Zhuhai dutyfree store located on the border of China and Macau.
According to Mr Piyawat, in a strategic move to expand the customer base the company acquired Oxe Cure acne cream in April of this year and has been negotiating mergers and acquisition deals with several companies.
The company has plans to introduce its own brand in the premium skincare market.
Founded in 2010, Do Day Dream at first focused on the original equipment manufacturer segment for skin care products with registered and paid-up capital of 1 million baht before founding Namu Life Brand and launching its own moisture facial cream as its first product in a year later with online (Line, Facebook and Instagram) and traditional trade channels for distribution.
In 2014, the company launched three more products of Namu Life Snail White and expanded into body care products and modern trade and exports to China, Hong Kong, Myanmar and Cambodia. In the same year, the company increased its registered capital to 10 million baht for business expansion.
Do Day Dream founded Namu Life Plus Co in 2015 as a marketing arm and expanded into sunscreen and cleansing products while investing in a factory located in Rojana Industrial Park.
In 2016, the company expanded into body cleansing and started production at the Rojana Industrial Park plant and increased capital to 225 million baht for business expansion.
Last year, Do Day Dream became a public company and filed an IPO and raised registered capital to 318 million baht ever since.
“We at first produced only [Manu Life] Snail White facial cream, which we mainly sold on Facebook and our sales value was 90 million baht in the first year,” Mr Piyawat says. “Our products have gained popularity on a gradual basis and we will continue to extend product lines to body care, sunscreen and cleansing products. The distribution channel has also expanded with modern trade tools and exports to China, Hong Kong, Myanmar and Cambodia. Sales reached 1.67 billion baht in 2017 with a net profit of 112.5 billion baht.”
Mr Piyawat says Thailand’s skincare market is enticing given its 60-billion-baht size, about half of which stems from the facial care market.
Snail White is the sixth-largest facial care maker by sales after big international brands L’Oreal, P&G, Beiersdorf, Unilever and Hada Labo of Japan.
Snail White ranks among the top six largest facial care brands via modern trade outlets, although it has only eight facial care products. L’Oreal, by comparison, has 80 product items, P&G sells 49 items, Beiersdorf has 60 items and Unilever 31 items.
“Given that the overall market is promising, we foresee a lot of room for Snail White to grow,” Mr Piyawat says. “We expect to increase Snail White facial care to 30 items over the next five years.”
Manu Life has three categories, comprising skincare, bath and body, and dermatological products.
To cater to the limited spending power of consumers, the company aims to ramp up its sales of smal products or sachet packages sold in convenience stores.
Abroad, the company aims to expand further in A sean countries in the fourth quarter of this year after having already expanded into Myanmar, Laos and Cambodia.
By doing so, the company expects sales to reach 2.17 billion baht this year and 3.4 billion baht in 2020.
“We aim to become the leading Asean facial care brand within the next 10 years and become the leading facial care brand in Asia in the next decade,” Mr Piyawat says.
We foresee a lot of room for Snail White to grow. PIYAWAT RATCHAPOLSITTE Chief financial officer, Do Day Dream