(Yicai) April 17 -- Kosé Corp. is shuttering its online store on Alibaba Group Holding’s e-marketplace Tmall tomorrow as the Japanese cosmetics company makes adjustments to its store layout in China amid intense competition.

The Kosé Tmall store, whose operator is a unit of Tokyo-based Kosé, has accumulated over 885,000 followers during its 14 years in business, according to the e-shop’s website. Kosé’s brick-and-mortar shops in China and its online mall on WeChat will continue to operate. Kosé closed its official on-line store on its China website in August last year. 

The Tmall store is being closed as part of the group’s business adjustments, company insiders told Yicai. The confusion is only because the shop has the same name as the group. Kosé continues to operate as normal in China and attaches great importance to the country’s market.

Kosé owns a number of other brands, including Decorte, Sekkisei, and Albion, that are popular with Chinese consumers and their e-shops on Tmall are still open, according to Yicai research. And there has been no announcement that they will be closed.

The main reason why companies such as Kosé are changing their store layout is because emerging local cosmetics brands are becoming more popular with Chinese consumers in recent years, said Bai Yunhu, founder of digital supply chain platform Yiyoumei and an expert on chemicals for daily use.

On the other hand, there is no need to read too much into changes in sales channels by leading cosmetics firms, said Bai. As in the current market environment, it is not unusual for some established foreign brands to tweak their sales strategies.

Unlike mature markets in developed countries, competition in China's on-line beauty market is extremely fierce, forcing many companies to sacrifice brand premium and even product quality to remain in the market.

But for established foreign cosmetics firms, though, this type of cutting-throat competition is not worth the battle, and therefore it may serve them better to close their stores on Chinese e-commerce platforms and regain their brand independence, he added.

Editors: Tang Shihua, Kim Taylor