Lafaso.com, one of the Chinese cosmetics etailers is expected to break even after its inception in 2008, the company’s CEO Wang Lichen told local media.
Funded by Sequoia China, the women-centric site pulled in RMB 100 million and 300 million in 2009 and 2010 respectively, as for last year the number is expected to reach RMB 1 billion. The company’s marketing expenditure in 2011 was RMB 20 million, though.
Fours years after its founding, Lafaso now boasts 5 million registered users with a repeat purchase rate of 56%. The Beijing-based online outlet is trying to boost its user base to 10 million in this year, which means more marketing and branding expense. According to Wang, the company’s advertising budget will be 3 times last year’s to RMB 60 million.
On top of this, Lafaso is planning to expand its proprietary brands from about 10 to more than 20 in this year, with more than RMB 600 million ( marketing expense of RMB 50 million to 100 million for each brand) to promote these in-house brands. On the other hand, female apparel will also be added to its categories.