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Proya lost another "strong general". On July 28, a Proya official confirmed to a Beijing Business Daily reporter that its chief scientific officer Wei Xiaolan had resigned. Ten days ago, on July 18, Proya's former chief R&D officer Jiang Ligang also confirmed to the media that he had joined Pechoin. In recent years, with the rise of the "ingredient trend" in the domestic beauty industry, beauty brands have paid more and more attention to research and development. It is worth noting that when various brands are stepping up their efforts to attract talents to cope with market competition, Proya has frequently been exposed to poaching incidents, and the departure of industry technology giants has become the focus of attention.

The loss of core talents

Regarding the departure of the chief scientist, a relevant person in charge of PROYA told the Beijing Business Daily reporter: "Wei Xiaolan has confirmed her departure. The subsequent R&D department will be in charge of the company's co-founder Cao Liangguo."

Wei Xiaolan joined PROYA in September 2022. Prior to joining PROYA, Wei Xiaolan had nearly 20 years of R&D experience in the global cosmetics field. In 2018, she served as Vice President of R&D for the Asia Pacific region of cosmetics giant Coty Group.

At that time, PROYA was at the center of public opinion for "focusing on marketing and neglecting R&D". Wei Xiaolan's joining was seen as a signal that PROYA's R&D system would further align with international beauty products and build a global R&D team.

It is worth noting that in the past two years, PROYA's core talents have been constantly lost. In 2022, PROYA's Chief R&D Officer Jiang Ligang left PROYA. On July 18, Jiang Ligang also confirmed to the media the news of joining Pechoin.

Wu Daiqi, CEO of Shenzhen Siqisheng, believes that it is common for senior executives to leave the company. Usually, if the executives' ideas differ greatly from the business policies determined by the board of directors and they cannot reach a final consensus, they may leave the company to seek other opportunities. "Such resignations have a certain adverse impact on the company. If the R&D department cannot find suitable talents in time, it may lead to a decline in scientific research strength and innovation capabilities. Although PROYA's product strength and marketing capabilities are relatively strong, the loss of key talents also reminds the company to optimize its internal management and culture."

However, in the opinion of Zhou Ting, director of Yaoke Research Institute, the departure of core executives will have a certain impact on the brand, but the impact will not be too great, especially for the head of the product department. For a brand like PROYA, the head of product is just the material for its storytelling. Without this, better ones can be found, and those who leave do not have the ability to become opponents worthy of attention.

In response to Wei Xiaolan's departure, a relevant person in charge of PROYA told the Beijing Business Daily reporter: "With the joint efforts of the company and several R&D leaders, PROYA has now established a complete global R&D and innovation system."

R&D investment is lower than peers

In 2023, PROYA's revenue reached 8.9 billion yuan, making it the largest domestic cosmetics brand. At this time, domestic cosmetics have entered the second half of the competition - competing in product strength. At the same time, key talents in the industry who can demonstrate the brand's product strength are also flowing rapidly. The dramatic scene is that while other domestic cosmetics brands are constantly recruiting talents, PROYA is losing talents.

In June this year, Shanghai Jahwa appointed Lin Xiaohai, who had worked at Procter & Gamble, Alibaba, and Sun Art Retail, as the chairman of Shanghai Jahwa; in July, Chen Min, who had served as the general manager of L'Oreal China's high-end cosmetics department and the general manager of Coty China, was appointed as the general manager of the beauty department; Ye Wei was also hired as an external brand marketing consultant. Also in July, Pechoin appointed Jiang Ligang as CTO (Chief Technology Officer).

In the view of Jiang Han, a senior researcher at Pangu Think Tank Research Institute, as the market changes and competition intensifies, it is inevitable for domestic beauty brands to shift from focusing on marketing to focusing on scientific research. In the past, marketing methods played a vital role in building brand awareness and influence. As consumers' requirements for quality and research and development increase, beauty brands must increase investment in research and development and innovation to meet the changing needs of consumers.

From the perspective of R&D expenditure, PROYA is also continuously increasing its R&D expenditure. In 2023, PROYA's R&D expenditure was 174 million yuan, a year-on-year increase of 35.6%. At the same time, PROYA's scientific research team is also growing. According to the 2023 annual report, PROYA has 322 R&D personnel, a year-on-year increase of 40.61%.

However, in terms of the proportion of R&D expenses, PROYA is at the bottom of the industry. In 2023, PROYA's R&D expenses will be 174 million yuan, accounting for 1.96% of revenue, which is much lower than other brands in the same industry. In 2023, Huaxi Bio's R&D expenses will account for 7.34%, Beitanni will account for 6.07%, and L'Oreal will account for 3.13%.

Beijing Business Daily reporter Zhang Junhua