The luxury skincare brand La Prairie, which is owned by Beiersdorf, has been significantly impacted by the Covid-19 pandemic. As international travel has come to a halt, the brand’s sales have taken a hit. La Prairie heavily relies on sales from international travelers at airports, a retail channel that has been severely affected this year. The travel retail sector, which was previously a strong channel for luxury brands, is expected to remain weak for the foreseeable future. This decline in sales has not only affected La Prairie, but also travel retail chains, airlines that sell goods on flights, and airport operators, all of whom heavily rely on revenue from travelers.
However, while luxury brands like La Prairie are facing a decline in sales due to the travel situation, other brands in Beiersdorf’s portfolio have actually benefited during this crisis. Nivea, one of Beiersdorf’s brands, saw a minimal sales dip of only 0.6% in the first quarter of 2020. This is because Nivea products are sold in supermarkets and pharmacies, which have remained open during the pandemic. Beiersdorf’s medicinal brands, Eucerin and Aquaphor, also experienced a healthy sales increase of 11.5%. Additionally, the healthcare business of Beiersdorf, which produces products like Hansaplast plasters, saw a significant growth of 10.1%. While sales fell by 5.7% in Europe and 6.7% in Africa, Asia, and Australia, they rose by 8.7% in the Americas.
In conclusion, La Prairie, along with other luxury skincare brands, has been heavily impacted by the Covid-19 pandemic due to the decline in international travel. Whereas La Prairie has experienced reduced profits, other brands in the Beiersdorf portfolio have actually seen some positive sales trends. This highlights the importance of diversification within the company’s portfolio. Moving forward, it will be crucial for La Prairie and other luxury brands to adapt and find new avenues for sales growth in order to mitigate the effects of the ongoing travel restrictions.