Introduction: Against a backdrop of shifting traveller demographics, geopolitical uncertainty and evolving consumer expectations, Shiseido Travel Retail is sharpening its focus on experiential retail, traveller diversification and long-term brand equity across Asia Pacific.
In her first media briefing since taking the helm of the regional travel retail business, Deputy Managing Director, Travel Retail Global Business Division and General Manager, Travel Retail Asia Adele Zhang talks about Hainan’s bright spots and why immersive offline activations remain central to the company’s strategy for engaging a new generation of travellers.
Giving an overview of the health of the beauty category in the Asia Pacific region, Shiseido Deputy Managing Director, Travel Retail Global Business Division and General Manager, Travel Retail Asia Adele Zhang says: “The Asia Pacific market has evolved very quickly over the past decade. Every year brings significant change, but 2026 has been particularly volatile.”
“Market performance across the region has been very mixed,” she explains. “We’ve received positive news from Hainan, driven by the Free Trade Port policy and strong support from the central government, which has boosted traffic and strengthened travel retail sales performance.
“At the same time, we’re seeing structural shifts in China’s retail landscape. In airports such as Shanghai and Beijing, new retailers have entered the market, creating some disruption during this transition period.”
As reported, China Duty Free Group (CDFG) and Wangfujing Duty Free won the anchor retail concessions at Beijing Capital International Airport. CDFG and Avolta – through Dufry (Shanghai) Commercial Co – split the Shanghai Pudong and Hongqaio airport duty-free contracts.
CDFG secured the Pudong T2 and Satellite Hall 1 and Hongqiao T1 arrivals and departures concessions while Avolta was awarded the Pudong T1 and Satellite Hall departures and arrivals business.
Zhang adds, “We are closely monitoring the situation and hope conditions will stabilise in the second half of the year so the market can return to growth, but it remains challenging at the moment.”
Shiseido navigates Japan-China headwinds as Hainan and wider travel retail temper Q1 -3% net sales decline
Japanese beauty group Shiseido Company reported ¥232 billion (US$1.46 billion) net sales in the first quarter of FY2026 for the period ended 31 March, representing a -3% like-for-like decline. China & travel retail delivered a stronger-than-expected performance for Shiseido Group, with net sales down -1% on a like-for-like basis, exceeding internal forecasts. Shiseido highlighted “strong growth” in Hainan and said the impact of Japan-China tensions had been “smaller than expected”. This has prompted the group to revise its full-year outlook upward for the region and target full-year growth. Click here for the full story. |
Commenting on the geopolitical tensions between Japan and China, which have cast a shadow over the Japanese beauty powerhouse’s performance, Zhang says: “For the Shiseido Group specifically, geopolitical tensions between Mainland China and Japan have resulted in flight cancellations. To mitigate this, we are focusing on attracting other nationalities and diversifying our customer base.
“Historically, Japan travel retail was heavily dependent on Chinese travellers,” she adds. “Since the end of last year, however, we have seen a decline in that customer base, so our Japan travel retail team quickly adjusted its strategy and increased investment behind other nationalities.
“One simple example is language,” she explains. “Previously, we focused heavily on Chinese-language training for our beauty advisors and used translators to support service. Now we are placing more emphasis on English and trying to better understand the preferences of non-Chinese travellers.
“Their purchasing behaviour is not completely different, but there are some distinct preferences. We have shifted our focus and investment accordingly to better serve these customers.
“At the moment, growth from other nationalities has not yet fully compensated for the loss of Chinese travellers, but we are making progress.”
In 2025, Shiseido Group announced a restructure that combined its China & Travel Retail business segments into one reporting line, a move which Zhang believes has helped the beauty company boost internal synergies during a pivotal moment for the industry.
Zhang comments: “Under our leadership structure, China domestic and travel retail operate with strong alignment. This allows us to harmonise our marketing strategies, align investment behind the same franchises and coordinate promotional timing and activity.
“We also have clear promotional guidelines to differentiate channels while still maintaining consistent brand value for consumers.
“We want to grow all markets, but our priority remains what we call the ‘true traveller’ market.”
Shiseido has delivered a series of high-profile travel retail activations in recent years, including Beauty Terminal, as part of a wider strategy to drive engagement, conversion and long-term brand equity through immersive consumer experiences.
Commenting on the company’s continued investment in experiential retail, Zhang says: “Consumers today are not only price-conscious; they are also looking for experiences, especially in travel retail. The days when travel retail was primarily a replenishment channel are gone. Travellers now expect engaging and differentiated experiences.
“Brands and retailers need to give shoppers a compelling reason to stop at the counter and make a purchase. The type of experience you create has become extremely important,” she adds.
Omotenashi informs Shiseido Travel Retail’s new look at TFWA At the recent TFWA Asia Pacific Exhibition (11-14 May) in Singapore, Shiseido Travel Retail unveiled a refreshed booth concept inspired by Japanese spatial design principles, underlining its focus on experience-led retail and premium brand storytelling. Drawing on Japanese arts and aesthetics, the new booth design reflected the group’s heritage, craftsmanship and hospitality philosophy, while offering visitors an immersive environment to discover the breadth of the company’s travel retail portfolio. The concept was rooted in the Japanese principle of Omotenashi – a spirit of thoughtful hospitality centred on anticipating and fulfilling the needs of each guest. Through this lens, the booth was positioned as more than a traditional exhibition space, serving as a curated environment to encourage deeper engagement between travellers and brands.  At the exhibition, Shiseido Travel Retail highlighted continued investment in its core brands, including SHISEIDO, NARS and Clé de Peau Beauté, alongside its fragrance portfolio. The company said evolving traveller browsing behaviours are prompting the introduction of new activation formats, elevated service concepts and enhanced experiential touchpoints designed to maintain relevance with today’s consumers. The updated booth concept formed part of a wider industry emphasis at TFWA Asia Pacific on experiential retail, immersive storytelling and differentiated consumer engagement strategies across the travel retail channel.
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Bringing it back to Hainan, a showcase for some of Shiseido’s most memorable activations, Zhang says: “We saw very positive results in Q1, particularly in Hainan, thanks to three consecutive months of offline activations. In January, we launched Beauty Terminal; in February, we ran the Explore Your Extraordinary campaign; and most recently we introduced a new foundation activation from NARS.
“Younger consumers are looking for high-efficacy products, personalised experiences and fun activities they can share on social media. We are trying to create stronger connections with younger shoppers, build trust and ultimately drive sales.”
Zhang believes that Shiseido Travel Retail’s experiential strategy is designed not only to elevate visibility, but also to create more meaningful consumer connections across the traveller journey as browsing habits continue to evolve.
“We continue to strongly believe in the travel retail channel because it is no longer just about replenishment or offering competitive pricing compared to domestic markets,” she explains.
“Travel retail stores are important platforms for showcasing brands, building awareness, strengthening brand equity and recruiting new customers.
“Historically, products would launch first in domestic markets before benefitting from a halo effect in travel retail. Now we are discussing whether some launches should happen in travel retail first because the channel attracts a much broader international customer base.
“Offline activations are certainly more costly, but they are also more meaningful. Digital campaigns and coupons can be very transactional, whereas physical activations create experiences and deeper engagement. They also allow us to hear directly from customers, understand their feedback and continuously improve.”
Looking ahead, Zhang believes Shiseido Travel Retail can create a winning beauty proposition through product innovation, a consumer-first mindset and adaptability.
“The market will continue evolving rapidly, influenced by geopolitics, travel trends, currencies and many other external factors. We need to stay very close to these developments and adapt accordingly,” she says.
“Ultimately, however, success still comes down to strong brands and high-efficacy products.
“I’m very confident in Shiseido Group because we have more than 100 years of research into Asian skin, backed by advanced science. Our product portfolio is designed to meet the needs of consumers across different nationalities and age groups.” ✈
