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chen min, former general manager of coty china, jumped to shanghai jahwa, jiang li, former chief research and development officer of proya, joined pechoin, and yu wei, ceo and president of xiangyibencaoyuan, resigned and crossed over to junao health... in 2024, there will be frequent talent turnover in the domestic beauty industry.

now, the industry leader proya (603605.sh, stock price 88.45 yuan, market value 35.093 billion yuan) has also undergone important changes in its senior management. on september 12, proya announced that fang yuyou, the co-founder, former director and general manager of proya, would no longer serve as a director of the company for personal reasons, and hou yameng, the former deputy general manager of proya, would take over fang yuyou as the company's general manager.

hou yameng, 36 years old this year, is the son of hou juncheng and fang aiqin, the controlling shareholder and actual controller of proya.

among all the domestic brands, proya has achieved outstanding results. in the first half of this year, proya's operating income increased by 37.9% year-on-year to 5.001 billion yuan, and its net profit attributable to shareholders increased by 40.48% year-on-year to 702 million yuan.

why did proya change its management team shortly after the release of its semi-annual report? in response, the company told the reporter of daily economic news that "this change of leadership is a normal change every three years. we hope that this adjustment will better prepare the company for the next growth cycle."

hou yameng takes over as ceo of proya. can he lead the company to compete in the second half of the era when domestic brands are breaking through?

the second generation born after 1985 becomes the general manager of a leading domestic cosmetics company

since the beginning of this year, news that fang yuyou will "withdraw" from proya has been circulating.

on september 12, proya released the "resolution announcement of the first extraordinary general meeting of shareholders in 2024" and the "announcement on the resolution of the first meeting of the fourth board of directors". the announcement shows that proya founder hou juncheng continues to serve as the company's chairman. proya co-founder, former director and general manager fang yuyou will no longer serve as a director of the company for personal reasons. in the future, he will continue to be the company's co-founder and board advisor to assist the company in strategic planning and business management support. proya's former deputy general manager hou yameng was appointed as the company's general manager.

fang yuyou is the younger brother of hou juncheng's spouse fang aiqin. in july this year, he was named "forbes china's best ceo 2024". this time, fang yuyou's "handover" was actually paved in advance.

the reporter of daily economic news checked the previous announcements released by proya and found that fang yuyou has been reducing his holdings since 2020. at present, fang yuyou's shares in proya have dropped from 24.43% at the beginning of the listing to 15.03%.

"after fang yuyou leaves, proya may change its development direction, which is also a strategic choice the company faces, namely, whether to develop towards high-end and strengthen brand investment, or to stick to cost-effectiveness and take the popular route." zhou ting, director of yaoke research institute and an expert in high-end consumer products research, said in an interview with a reporter from the "daily economic news".

hou yameng was born in december 1988. he is a chinese citizen with no permanent residency abroad and a college degree. he has worked in the e-commerce department of proya since 2014 and has served as the company's director and deputy general manager since september 2021. he is currently the executive director and general manager of hainan mengya enterprise consulting co., ltd., the executive director and general manager of hangzhou caitang cosmetics co., ltd., and a director of proya beauty malaysia sdn. bhd. as of the latest announcement date, hou yameng does not hold proya shares.

an industry insider familiar with beauty told the daily economic news reporter that by working closely with proya, hou yameng has accumulated practical experience in branding, products, and marketing.

as a "second generation" executive born after 1985, hou yameng expressed his views on the domestic beauty market when participating in industry events this year. hou yameng believes that the consumption concept of the new generation is changing rapidly. when they choose cosmetics, they not only consider their quality and effects, but also their environmental and social impact. technological innovation has become the main theme of china's beauty industry, and is driving domestic brands to gradually become mainstream.

traffic costs are getting higher and higher

how can beauty brands break through?

founded in 2003, proya’s market value has increased significantly along with its stock price after its listing, and its revenue has increased from 1.783 billion yuan in 2017 to 8.905 billion yuan in 2023.

in 2023, proya's net profit attributable to its parent company increased by 46.06% year-on-year to 1.194 billion yuan. with its outstanding performance, proya officially surpassed the century-old shanghai jahwa (revenue of 6.598 billion yuan and net profit of 500 million yuan in 2023) and became the leader of domestic beauty products.

in the first half of this year, proya continued to maintain growth: operating income increased by 37.9% year-on-year to 5.001 billion yuan, and net profit attributable to shareholders increased by 40.48% year-on-year to 702 million yuan.

"in recent years, consumers have become more rational, and their desire to pay for brand premiums has significantly decreased. many consumers, especially young consumers, have a basic requirement for choosing cosmetics, which is both good brand and high cost performance." zhou ting analyzed to the reporter of "daily economic news" that proya has seized this market opportunity. while maintaining its high-end brand image, it provides customers with very cost-effective products and fully grasps the dividend opportunities of lifestyle education in recent years.

proya told the reporter from the "daily economic news" that the purpose of completing the management change is to better accumulate strength for the company in the next growth cycle.

however, zhou ting pointed out that after several years of the "ingredient party" trend, "the future beauty market will belong to high-end brands and brands that can provide personalized customization services." therefore, it will not be easy for proya to continue to maintain its leading position in the second half of the beauty competition.

the reporter noticed that behind the double increase in revenue and net profit, proya also paid a high promotion cost. from january to june this year, proya's sales expenses increased by 48.08% year-on-year to 2.34 billion yuan, and the sales expense rate was 46.78% (43.56% in the same period of 2023). proya said that this was mainly due to the increase of 688 million yuan in image publicity and promotion expenses in this period, a year-on-year increase of 50.03%.

"high-end development is the only way. high-end development includes improving brand image, launching better products, providing better services, etc. otherwise, as traffic costs become higher and higher, customers' requirements for cost-effectiveness become more and more stringent, and there are more and more competitors and substitutes, proya may fall into the trap of low profits in the large market." zhou ting believes.