Mary Kay Cosmetics in China: Business Is in the Pink

SHANGHAI -- On a warm and breezy August night here, a small group of reporters visiting from Washington met with the China president of Mary Kay cosmetics over dinner at a rooftop restaurant. Mary Kay is thriving in China, recovering nicely from a bleak time during the late 1990s when the Dallas-based company was shut down by the Chinese government, its network of sales consultants barred from doing business for five months. The venerable and innocent Mary Kay had been swept up in a government crackdown on pyramid schemes that cropped up as capitalism took root in the Chinese economy, many of them fly-by-night schemes that had destroyed the livelihoods of ordinary Chinese and forced the government to step in.

The government was wary of Mary Kay because of the unbridled enthusiasm of its representatives along with the company's grassroots network throughout the country, a combination that seemed potentially threatening to a central government learning how to navigate western-style capitalism. Mary Kay worldwide relies on a sales force of 1.8 million, with more than half in global markets, who host skin-care parties and sell directly to customers. The women who are employed – and they're all women – are cheerleaders for Mary Kay products and the principles of female business empowerment established by the company's late founder, Mary Kay Ash.

In China, the U.S. embassy stepped in to work out a compromise that allowed Mary Kay's method of direct selling to continue, and today there are 1,000 pink cars in China, the time-honored reward for top sellers. Mary Kay China President Paul Mac, using his Americanized name, said that until this year, he got the cars from General Motors, but switched to Volkswagen because the German company agreed to paint the cars pink in the factory, which for whatever reason, GM refused to do.

Asked what the top-selling Mary Kay product is in China, Mac replied without hesitation, whiteners. Lighter skin is the beauty goal for Chinese women, who carry brightly colored umbrellas that look more like parasols to protect themselves from the summer sun. "If you open a tanning salon in Shanghai, you will go broke," he said. "In China, fair skin is good." Anti-aging and anti-wrinkle creams are also popular. Skin-care products are big in China, accounting for 80 percent of Mary Kay's business, with only 20 percent for what Mac calls color cosmetics. While men are using skin-care products more than they did in the past, Mary Kay's customer base is predominantly women, with men doing what Mac confesses he does, borrow his wife's products.

Over a western-style dinner with the bright lights of a newly vibrant Shanghai skyline glittering all around, Mac addressed our group of five journalists on a tour hosted by the Institute for Education, a Washington-based nonprofit, in partnership with the Chines People's Institute of Foreign Affairs. Mac told us that in his first ten years as president, he grew the business 42 times over. "It's not just me -- the income level and the population grew," he readily concedes. His entire workforce is female, and he notes that in China there are more and more career women and that most women work outside the home. Mac is 51 or 52, depending how you count, he says, because in China some add the months of gestation, and babies emerge at 1 year. His grandmother's generation stayed home, and that began to change with his mother's generation, much as it did in the United States.

Amidst all the dynamic capitalism and consumerism in China, many strong traditions remain. For example, I was surprised to learn that makeup is banned in high school. It's considered bourgeois and it distracts from studying. Mary Kay herself probably wouldn't mind that prohibition. She was all about hard work and building self-esteem to compete in what was then an overwhelmingly man's world. She started her company in 1963 as a way for women to earn money part-time while caring for their children, or for empty-nesters looking for a way to enter the workforce. Mary Kay died in 2001, but her business practices live on with her son and granddaughter now running the business.

At the end of the evening, Mac handed out copies of "The Mary Kay Way," originally published in 1984 and reissued in 2008. It sets forth a philosophy of business that is both revolutionary and quaint in its insistence on praising workers and rewarding them. In addition to the pink Cadillac, for which Mary Kay is known, top sales people receive a large, diamond-studded bumblebee. Aerodynamically, bumblebees aren't supposed to fly. Their wings are too weak, and their bodies too heavy. It's the perfect symbol, Mary Kay explains, for a company that teaches people how to spread their wings and fly on their own.