During this pandemic, it is all about online shopping. People were bored, restless and one of the things left was to shop online.
This is where beauty products come in. As customers could not go to the stores during the lockdown, there was a particular rise in the sales of beauty products online.
In stores, shopping has always been a sensorial experience, why else would there be product testers? People enjoyed testing products, doing lipstick swatches and spraying on fragrances. But, this pandemic took that away and customers learnt to get used to it and started buying more online.
Cindy Poh, country manager of Luxasia Malaysia (the beauty giant with brands like AHC, Hermes, Coach, La Prairie) says initially they didn’t meet the 2020 total sales target set at the start of the year.
She says the company achieved "a decade in days" level of growth in terms of online sales and digital competencies.
“Our total online revenue grew close to three times, which is an achievement worth celebrating. Online sales now contributes up to 20% of most of our brands’ sales, compared to previous years’ share under 5-10%.
“The icing on the cake in e-commerce for Luxasia Group was that we not only won at the Asia eCommerce Awards 2020 for the second year running, we were also mentioned by Forrester as a ‘Mid-sized Regional Full-service Provider for eCommerce’ in their research report ‘Now Tech: E-Commerce Enablers For Southeast Asia Marketplaces, Q4 2020’.”
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But Luxasia has already been familiar with online shopping so it wasn’t hard for the company to adjust during the pandemic.
Poh says Luxasia, as a Group including their business in Malaysia, has been investing heavily over the past four years into strengthening their online-selling and digital marketing competencies since 2016.
“By the start of 2020, we had a regional e-commerce and digital marketing centre-of-excellence based in the Philippines, supporting the local Malaysia e-commerce team which manages the relationships and operations on all online marketplaces (Shopee, Lazada, Zalora, and the likes), working together with our Sales & Marketing talents who by then had become well-versed in omnichannel brand management. In hindsight, we are grateful that this turned out to be timely and critical. It made the difference for our survival and reasonable success in 2020.”
Poh says it was teamwork more than anything that helped them.
“The most critical success factor in this whole experience is grit, tenacity and adaptability of our talents at Luxasia. I am both humbled by them and proud of them. Was it hard? Of course it was. But we had to do it to keep our company afloat. We were motivated to overcome our difficulties because we cared for each other, our livelihoods and our families.
“Specific to Covid-19-induced initiatives in the way we operated and managed our business, everyone in the organisation went many extra miles, beyond their usual job scopes. Administrative staff learned to deliver customer service and responded to enquiries, retail staff going online to do virtual beauty consultations, many brand talents and trainers also partnered influencers/Key Opinion Leaders to sell products, and the list goes on.
“Notably, when e-commerce volumes were at its peak, many from different functions were mobilised to help with logistics and fulfilment. 2020 marked an organisation-wide orchestration of people going way beyond their call of duty. Looking back, there were many inspiring memories that showcased what teamwork really looks like at Luxasia; what we call 'One Team'."
When it came to popular skincare items, the Ceramide capsules from Elizabeth Arden did exceptionally well online. While brands like La Prairie Malaysia is not on any local e-commerce platforms, it does offer home delivery to clients via contacting beauty advisors.
“As people work from home, they gradually increased their use of facial sheet masks which provided pampering as they dwelt indoors and we saw a good growth in that sub-category. Because of the need to use face masks for protection when people go out, consumers switched from heavy formulation products to light serums and moisturisers that are non-comedogenic i.e. does not clog pores so as to prevent mask-related accumulation of sebum and acne.
“As such, brands like AHC and Peter Thomas Roth benefitted from the growth in skincare demand. Even products from the luxury brands of La Prairie and Albion also picked up quickly when stores were allowed to be open," says Poh.
Hair, bath and body brands also became more popular, they even managed to drive sales for fragrances with bundle deals, purchases and seasonal campaigns.
Ken Lim of Kens Apothecary which carries brands like Eve Lom, diptyque, Dr. Brandt and Caudalie among others says personal products sold well.
According to Lim, scented candles in particular and personal care saw a fast growth and he predicted the increase in haircare products as salons were not allowed to operate during MCO.
“Consumers will continue to indulge in personal care as well as scented candles, which are great mood enhancers. Scented candles’ sales will continue to grow because people do gather at home," Lim says.
Growth in sales
“Online sales has achieved tremendous growth and it has increased more than double for us in 2020. However, brick and mortar still did better," Lim says.
“It took us a few days to set up the SOP; in terms of logistics and payment portal. We introduced KENS porter service, a whatsapp delivery portal on virtual selling. Our Sales team is trained to interact with customers on whatsapp and offer delivery service. The Sales team at the store would whatsapp clients then arrange delivery after the clients have made payment.”
When it came to products that sold well, he said it was mainly the personal ones.
Lau Shin Yee, brand manager of Sulwhasoo says they put a lot of effort in online sales.
“It was a tough year, I believe for many industries too. Mainly because there were many uncertainties. The brand put in a lot of focus online and our online sales tripled in 2020. On the other hand, offline channel remains important for Sulwhasoo, as the brand is still focusing on providing a more personal touch experience for our customers.”
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According to Lau, their staff coped quite well and she says, “We constantly monitor the trends especially customers’ personal needs during the pandemic. We had to respond quickly to our customer’s requests and currently, there are various services that we offer (for example, same day delivery service, messenger counselling, phone or even video counselling) for our customers to shop from home and stay safe.”
“We also constantly do ‘livestreaming’ on our social media channel where our trainer can share beauty tips and demonstrations in the virtual space. Our HQ and regional office also provided good support in training beauty advisors in virtual selling and live shows.”
Their bestsellers were the Sulwhasoo First Care Activating Serum and Concentrated Ginseng Renewing Serum, which remained at the top of customers’ list.
Another product, Concentrated Ginseng Renewing Serum is the most sought after anti-ageing serum.
Lau anticipates that this year their e-commerce sales will continue to grow and the portion to brand will increase.
“We have also recently started our own brand e-commerce platform (sulwhasoo.my) as an additional avenue for our customers to reach out to our products online, with the assurance of product authenticity and customer service from the brand itself. Whilst we focus to grow the e-commerce channel, we also continue to improve offline business by providing our loyal customers the 'Sulwhasoo Service'."
Looking towards the future
Poh says taking a leaf from what their Group CEO Dr Wolfgang Baier has shared before, the future of luxury beauty and retail is neither exclusively online nor exclusively offline.
It is omnichannel, meeting in the middle, where the online and offline fuses to deliver a seamless offering to all consumers.
“Certainly, the future will be even more digital than today. It has been progressing in this direction for years. Covid-19 was simply the catalyst that accelerated the change by ‘a decade in day’.”
“Crises are birthplaces of opportunities. While this pandemic has been challenging and has claimed some companies, we found that the survivors, including ourselves, are also forced beyond our comfort zones to innovate and re-think the way we operate.
“What is for sure is that the online-shopping surge will not stop. With retailers focusing on their online stores too, we will see more exciting collaborations between brands, retailers and consumers. Till the situation permits, there will be more virtual launches of products instead of physical launches. Brands will likely increase their share of spending for social media engagement and marketing. These are exciting times ahead," Poh says.
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According to Lim, luxury beauty emphasises on consumers’ experience and he still saw a lot of customers returning to shops during the holiday season because of the personalised services.
Lau says instead of saying “digital”, she too thinks “omnichannel” will be the future.
“It means customers are able to shop via various channels or platforms, whether it’s through physical store, e-commerce, messenger or via a phone call. This is what Sulwhasoo is also focusing on at the moment, keeping our customers as our main priority, providing them the best options/channels to ease the purchasing journey, and at the same time providing great customer service.”
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