These articles are the latest in our popular series in association with Tito’s Handmade Vodka, which examines travel retail and airport sector ‘disruptors’ and innovators – focusing on companies and individuals challenging established models through innovation.
How personalised marketing and predictive modelling can drive growth
Travel retailers may find AS Watson Group’s integrated online and offline strategy for penetrating specific demographics or entering new markets an interesting template for their own operations, says Kevin Rozario.
Hong Kong-based AS Watson Group is using predictive modelling and advanced CRM (customer relationship management) techniques in partnership with brands to drive product launches globally.
Examples include the exclusive launch of Jeffree Star Cosmetics at ICI Paris XL stores in Europe and, in Asia, a continuing long-term partnership with Maybelline at Watsons Thailand. Both have generated excellent results, according to AS Watson.
“Due to our extensive global knowledge of the beauty industry and CRM data, we are helping niche players like Jeffree Star and major brands such as Maybelline,” commented AS Watson Group Chief Operating Officer Malina Ngai says: “Our integrated online and offline model allows us to create brand partnerships to specifically target and engage the right customers.”
In 2018, in partnership with L’Oréal – the owner of Maybelline – Watsons Thailand was able to drive up sales and give customers more reasons to buy into makeup in a year-long CRM programme.
Supported by AS Watson DataLab (the group’s customer intelligence team), the campaign communicated offers to relevant customers through electronic direct mail. Watsons targeted members in three phases in order to recruit new category shoppers, grow each customer’s basket value, and engage them with new product offers.
A three-stage approach to accurately identify customers and ensure they were shown the most attractive offers was also used. This campaign saw over 3.5 million emails delivered to members, attracting over 170,000 customers to buy into the brand.
The focused approach led to a double-digit percentage of the brand’s sales that were directly attributed to the campaign, according to the company. In addition, Maybelline’s sales recorded double-digit growth compared to the previous year.
L’Oréal Thailand Consumer Products Division General Manager Geoff Bellingham commented: “Two of the biggest challenges a brand faces are acquiring new customers and then having those customers shop again with the brand. Our Watsons Thailand CRM programme allowed us to successfully achieve both of those goals for Maybelline.
“All customers – and especially beauty shoppers – want relevant, more personally curated offers and this partnership was carefully created to ensure the right offers for the right people.”
While social media-led beauty brands are yet to have any serious impact in the travel retail channel, it is a different story in domestic markets. Taking a lead in this segment, AS Watson’s European retail brand ICI Paris XL launched world-renowned beauty influencer Jeffree Star’s cosmetic range in November 2018. The roll-out was exclusively for customers in The Netherlands and Belgium.
ICI Paris XL created a digital campaign to target shoppers whose data and profile indicated they would like the beauty line from the cross-dressing social media superstar. The focus was the under 35s and predictive modelling was used to identify and communicate with members who had a high tendency to shop new makeup brands and trends.
They received customised emails announcing the Jeffree Star Cosmetics launch, as well as highlighting hero elements of the range. The targeted approach to over 300,000 customers led to an open rate of 25%, of which 40% then visited the brand’s page on the ICI Paris XL website. The result was that an astonishing 70% of members under 35 bought into the range during the launch period, claimed AS Watson.
Jeffree Star commented: “Following the success of my brand in the USA, I wanted to extend my reach into Europe. AS Watson provided me with an efficient distribution platform as well as the tools to target my fans and beauty lovers that like to create bright, fun and innovative beauty looks.”
AS Watson Group operates more than 14,900 stores in 25 markets attracting over four billion customers and members to shop across its 12 retail brands, both in-store and online. In fiscal 2017, the company recorded revenue of HK$156.2 billion (US$19.9 billion).
Something’s Ecooking in travel retail
Skincare brand Ecooking has launched in travel retail with Gebr Heinemann and is described by the retailer as a perfect fit for “health-conscious customers who are yearning for environmentally-friendly products”. Jason Holland reports.
The skincare market is crowded, so it takes something pretty special for a new player to carve a niche in the segment.
At the same time, consumer behaviour and mindset is shifting rapidly with more regard for the environment and a desire for clean and healthy products.
Enter Ecooking – a skincare brand that has grown from small batch preparation in a kitchen to become a rapidly-emerging name in beauty.
Ecooking was developed by Danish entrepreneur Tina Søgaard, a beauty industry veteran of 20 years. Each product in the Ecooking range is created on the basis of specific requirements and is formulated to target a specific problem, she says. The brand is built on fundamentals principles of being “natural, organic, vegan and environmentally-friendly”.
Ecooking has grown to be listed in more than 500 stores and pharmacies in Denmark and was launched last year in another 20 markets. The brand has also begun to gather momentum in China since the opening of its flagship store on Chinese e-commerce website JD.com.
The brand’s contemporary take on skincare and compelling origin story will now be told in travel retail, as Gebr Heinemann has listed Ecooking in five stores under its new ‘Clean Beauty’ concept. Clean Beauty was initially targeted at Scandinavian countries but has also been launched in Germany at Frankfurt and Hamburg airports.
Heinemann sees the brand as relevant in today’s market where the demand for responsible, sustainable and clean brands is ever stronger. “We cater to this general shift in consumer behaviour and the passion for clean beauty among travellers and take the responsibility to list sustainable brands very seriously,” says Gebr Heinemann Director Purchasing Department Perfume and Cosmetics Britta Hoffmann.
“We were thus looking for organic and vegan and cruelty-free brands and found that Ecooking is perfectly meeting the demands of our health-conscious customers who are yearning for environmentally-friendly products. The trendy and biologically degradable packaging of Ecooking is also appealing to that target group and was thus a big plus for our decision to list the brand.”
Hoffmann adds: “The market for the entire category is changing at a rapid pace. It has become a lot more dynamic, the thirst for innovations is constantly increasing, with more and more brands entering the market.
“At the same time, customer requirements are more complex – from price-sensitive customers and those intent on luxury products to consumers seeking sustainable, certified organic ingredients. We aim to bring all these additional values to the perfume and cosmetics category at Heinemann.”
Brand founder Søgaard thinks the travel retail channel will offer great opportunities for exposure. “The world has become a village and people travel more and more, especially in small countries like Denmark,” she explains. “Visiting a duty free shop in an airport or a ferry is often a good way for me to discover new brands and new trends. For Ecooking, this is a great opportunity to get more visibility.”
Ecooking is represented in duty free and travel retail by Brand-Mover. The agency was founded by Karina Lassen, who was previously at Conaxess Trade.
Lassen sees Ecooking as a “perfect fit” for travel retail. “The products are rich in organic and natural ingredients and without any parabens at affordable price points,” she says. “So even though the skincare market is crowded, there is a huge potential for a new brand like Ecooking with its great story, its environmentally-friendly products and packaging and its attractive prices.”
Note: These articles have also appeared in The Moodie Davitt e-Zine. You can read the latest issue here.
