The A.S.Watson Group is the world’s largest health and beauty retailer with more than 16,100 stores across 28 regional markets in Europe and Asia. Its 12 retail brand portfolio includes Superdrug, the UK equivalent of Priceline, with 800 stores, including 200 in-store pharmacies, which is the second largest retailer of health and beauty in the UK.

The multinational posted revenues of US$22 billion last year, serving a mammoth 5.5 billion customers.

From the 6th to 8th June, The Consumer Goods Forum Global Summit 2023 was held in Kyoto. The only organisation that brings consumer goods retailers and manufacturers together, it is CEO-led and helps to connect key stakeholders in the space to secure consumer trust, drive change and work towards greater efficiency. For more information, go to www.theconsumergoodsforum.com

During one of the plenary sessions entitled – “The World is Changing, Consumers are Changing – We Need to Change Too”, Malina Ngai, CEO of A.S. Watson ( Asia and Europe) joined other distinguished panellists to address the global changes affecting retailers and manufacturers.

Ngai had plenty to share, outlining Watson’s remarkable expansion and growth over the past four years. The company has widened its global presence since the start of the Covid-19 pandemic in 2019, including expanding its footprint to the UAE, Qatar and Saudi Arabia in the Middle East. The company’s global membership has also soared from 137 million in 2019 to 148 million this year.

In the US and Asia, many beauty brands are chasing Gen Z customers, who are on the brink of outnumbering their older Millennial counterparts. Ngai also believes that consumers are rapidly changing and today’s customers want more than transactional relationships with retailers.

First of all, we should see changes as new opportunities, she said. “Today, consumers are becoming more emotional, more unpredictable, more educated, and more socially conscious. They want more choices, more deals, and have less time and loyalty.

“It’s becoming very complex to run a retail business because it’s not only about trying to win customers’ share of wallet but also share of time. Time is the new currency. With the constant change in their behaviours, retailers and manufacturers need to adapt accordingly and with pace”.

Ngai explained her philosophies using the Chinese term for business – Sheng Yi. A concept which incorporates the concept of customer centricity. The first word Sheng means lively, she noted. “We need to be flexible and not rigid. The second character Yi is made up of three parts – determination every day and think of the customer’s perspective”.

Adaptive change is the answer, says Ngai, to create sustainable growth and business needs to be determined to work tirelessly every day, listen to and meet customer needs.

“With sustainability being high on customers’ minds, businesses need to align their purpose with the customers’ values so that we can jointly create a more positive impact on the planet. All companies, big and small, from all geographic locations should work together toward sustainability. The subject of sustainability is far-reaching and requires collective efforts between retailers and manufacturers to create significant impact”.

Ngai was also instrumental in developing Watson’s O+O strategy from 2021. The new standard for retail is Offline Plus Online, she says, describes how customers shop today. The traditional strategy of O2O (online to offline or offline to online) drove customers from one channel to another. O+O is totally different and is more about creating an integrated experience to better serve customers’ needs that enables them to shop across any channel, anytime, anywhere.

The motivation behind O+O is clear, says Ngai. “There is no cannibalisation in customers’ spending in physical stores. In fact, O+O customers spend three times what an in-store customer shops with us. It’s about creating a bigger share of wallet and higher customer lifetime value”.

Watson’s has also curated O+O beauty experiences such as Go-in-Store, where customers who go online can book a video consultation with an in-store beauty advisor. Skin Analyser is also a popular offering in Watson’s stores around the world as personalised beauty gains more traction. While Endless Aisle features a touch screen that allows to shop and choose either to collect the products in store or have them delivered to their homes.

The O+O strategy showcases the fact that adaptive change has long been at the forefront of Watson’s business. The emphasis on technology, big data and AI has kept the company’s physical stores as the core touchpoints of the customer journey. All of the Group’s physical stores are connected to digital platforms, meaning the product offering is never limited by shelf space, notes Ngai.

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