Big regions
Following a healthy second quarter in China, Japan and Hong Kong, which ended on 30th June 2017, L’Occitane plans to further its new retail approach.
In this review period, the Group moved ahead with its omnichannel expansion strategy by extending its global retail network to include an additional four stores.
Local currency sales grew by 26.9% (23.9% growth at actual rates) in China and 4.0% in Japan (3.4% in actual rates).
Market strategy
L’Occitane orchestrated a campaign utilising celebrity endorsement by recruiting Chinese singer, Lu Han, as a successful brand ambassador.
This approach generated positive sales at brick-and-mortar stores and online retailers in China. The Group launched its own e-commerce channel, strengthened by its new line promotional messaging, in Japan to leverage consumer awareness and appeal in Asia-Pacific (APAC).
Travel retail and distribution channels proved a strong growth opportunity in Hong Kong with a global retail network enabling the Group to reach multiple APAC markets.
Growth period
The Group’s sell-out channels including marketplaces and its e-commerce stores achieved year-on-year (y-o-y) growth amounting to 13.2% of total sell-out sales. Due to double-digit store growth in China, the same store sales for the three months ending 30th June 2017 showed an improvement of a 0.6% fall compared to one of 1.3% during the same period in 2016.
New approach
“We are pleased to report a solid start to FY2018, which was supported by good returns from our ongoing marketing activities, particularly in China and Japan,” said Reinold Geiger, Chairman and Chief Executive Officer of L’Occitane.
As L’Occitane prepares to launch its “new ‘Sunshine concept’ stores, which will open soon in strategic markets”, the company hopes that by applying this innovative in-store trend, it “will further support this momentum”.
Its strategic plan includes a range of imminent implementations including further investment in its “new product pipeline, including the re-launch of the classic Devine range later this year and the introduction of an all-new hydration range in early 2018”.
Momentous innovation
Concept stores have been a significant trend throughout APAC, drawing upon the brand and consumer advantages of profile-raising temporary pop-up locations and immersive digital platforms.
Shiseido's prestige brand, Clé de Peau Beauté, harnessed experiential beauty and campaign customisation, at its new store launches. Designed to create “unique experiences that cannot be forgotten”, the new concept era strives to build a competitive edge in the marketplace.
Consumers are calling for product formats, active beauty, cutting-edge ingredient formulations and personalisation. As a result, brands are exploring new and inventive experiences that differentiate themselves to existing market areas and enable their products to stand out on the shelves.