To reach their ambitious double digit annual growth targets, LUXASIA has been investing heavily into technology and teams, collaborating closely with retail partners, to become the omnichannel leader on the Asia-Pacific luxury beauty stage. And this proved to be a key asset when the new coronavirus began to spread around the world.
“We have been enhancing our online retail for several years, and when COVID-19 hit we were more than ready, with more than 250 e-commerce stores already serving customers in the whole region,” says Wolfgang Baier, Group CEO of LUXASIA.
“In 2020, driven by the pandemic, our total online sales skyrocketed by more than three times, with one of our business units even achieving 60% online share of total sales for the year.”
With more than 120 luxury brands in their portfolio, 8000 points-of-sale, 2000 talents employed, and numerous joint ventures with major luxury players such as LVMH, Shiseido, Yves Rocher and Puig, LUXASIA serves 15 markets representing more than 3 billion potential consumers, who are now eager to return to normal. “We might be biased, but Asia-Pacific is the place to be for beauty and retail now,” emphasizes Baier.
LUXASIA understood way earlier on that omnichannel was a priority for businesses looking to gain an edge in the new retail landscape. The company began its omnichannel journey five years ago. Baier decided to enhance the group’s ecommerce and digital capabilities and to implement a consumer analytics-led approach to both its brick-and-mortar and online strategies.
To help brands successfully achieve their online aspirations and provide them with relevant tools, LUXASIA has launched LEAP Commerce, a regional full-service e-commerce enabler covering all digital channels: online marketplaces, mono- & multi-brand sites, and social commerce. The platform is forecast to generate 2 million transactions this year, and LUXASIA’s aim is to grow sales up to ten times in the next five years. Its next frontier would also be to accelerate and dominate luxury beauty social commerce.
Consumer knowledge and optimised operations
The Asia Pacific distributor has consumer-centricity at its core, with a database that includes more than 1.5 million luxury consumers, with validated preferences, growing at a rate of 30,000 to 40,000 consumers monthly. LUXASIA wants to know not only what people bought, but what they are looking for and their preferences.
“Data is crucial for customer engagement,” highlights Baier. All LUXASIA’s retail staff are equipped with tablets linked to its CRM engine, providing visibility of customer preferences and past purchases. This empowers the retail workforce with information to make recommendations that resonate, enabling effective up-selling and cross-selling.
“We invested massively over the last years to train and develop our 2000 LUXASIANs, especially on customer relationship management and digital marketing,” explains the CEO. Beyond in-store engagements, LUXASIA also uses its CRM engine, Salesforce, and the accompanying AI solution to drive consistent yet impactful consumer marketing.
In parallel, it has been critical albeit challenging to adapt its supply chain and operations to this business model shift. As LUXASIA manages most of its warehouses, it was possible to transform them over the past years. “Our fulfilment centers are now ecommerce-ready, optimised for both B2B and B2C operations,” says Baier. The company continues to invest into its technology infrastructure, including the warehouse management system, order management system, as well as a middleware that smoothens ecommerce operations across numerous online marketplaces in multiple languages and geographies.
Niche beauty experiences
While 30%-50% of all luxury sales in the Asia-Pacific region are expected to come from online in the near future, with social commerce being the next big wave, Wolfgang Baier says players need to streamline and enhance their omni-retail networks. As far as brick-and-mortar stores are concerned, this means they have to be fully integrated to the whole omnichannel system while providing a high-value additional experience.
According to Baier, niche brands have a huge potential in providing such high-end experiences, both online and in-store. LUXASIA has been shaping receptivity and growth of niche beauty in Singapore for more than 15 years through its Escentials omni-retail concept, combining an boutique website and three brick-and-mortar stores. Escentials carry leading niche luxury brands such as Creed, Acqua di Parma, Frédéric Malle, Diptyque, Maison Francis Kurkdjian, Penhaligon’s, Byredo and so on.
“Asian consumers are becoming much more concerned with what they are buying, the story behind it and how they differentiate themselves with it,” states Baier. To capture the galloping niche beauty interest and demand across the region, LUXASIA will be launching Escentials in Malaysia with the opening of a new site in October 2021 and a retail store in Kuala Lumpur in November 2021, followed by an expansion into Thailand and Vietnam in 2022. Truly exciting times for luxury and niche beauty in Asia Pacific.