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CK Hutchison's retail division A.S. Watson and telecom subsidiary 3 have partnered China’s Meitu to launch a new platform that integrates social media and retail.

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AS Watson is rolling out a new global VIP loyalty program to further connect with its customers around the world.

VIP loyalty program

A.S. Watson plans to make its new VIP loyalty program available across the 24 markets it operates by early next year. The retailer has approx. 130 million members worldwide, but the new program will be invitation-only to reward top customers.

Personalised rewards and benefits

VIP members will benefit from personalised rewards which will also vary between markets. Some of the advantages include, free health and wellbeing classes (Watsons China), cooking classes (Watsons Malaysia), free movie tickets (Watsons Thailand), free exclusive gifts and sample boxes (The Perfume Shop in the UK) and beauty workshops and shopping nights (ICI PARIS XL).

The retailer first invested in CRM programmes back in 2010 and more recently has been using Tech Partners to accelerate global digital transformation. The retailer's data analytics has revealed that around two thirds of its customers who qualify for the new program will continue membership in the following year. Retaining these VIP members are key as they spend up to eight times more than average members annually.

Malina Ngai, Group COO of A.S. Watson Group, said, “We appreciate our customers, no matter how much they spend in our stores, and we know they love to feel valued. Our existing loyalty programs reward everyone with great offers, but our VIP programs thank our most loyal customers for shopping with us with amazing benefits and even more tailored rewards.”

Want to know more?

Subscribers can read more on A.S. Watson's Strategic Outlook here.

AEON Stores Hong Kong, which operates stores in Hong Kong and on mainland China has posted a 6.7% increase in sales revenue to HKD4.9bn (US$628m) for the first half.

Record sales, but profitability remains a challenge

AEON Stores Hong Kong's sales revenue reached a record high for the first half ending 30 June, but high operating costs continued to impact profitability. The Group's profit before tax improved by HKD32.1m and significantly narrowed its loss to HKD38.5m from HKD70.6m for the same period last year. Sales from operations in Hong Kong and on mainland China increased 8.1% to HKD2.2bn and 5.6% to HKD2.7bn respectively.

Implementing sales and marketing initiatives 

The retailer has highlighted intensifying competition from retailers adopting new retail store concepts in the market. However, this has led to opportunities for greater and more creative personalisation in marketing. During the period, the retailer continued to focus on improving shopper experience and operational standards (e.g. cost control). It also adjusted much of its merchandise offer and remained committed to its Super Wednesday initiative.

The AEON STYLE store concept, which launched in Hong Kong (derived from operations in Japan) just over two years ago, posted robust sales with the number of customers visiting increasing 5.2% during the first half.

As of 30 June 2018, the retailer operated 60 stores in Hong Kong, four fewer than it did at the end of December last year. The Group maintained its network of 32 stores in southern China.

H2 and what to expect...

AEON Stores Hong Kong will continue to improve the user experience of its mobile app, AEONCITY, to boost online sales. For new stores, it will maintain the strategy of opening small specialty stores, while it will look to incorporate AEON STYLE elements to strengthen the proposition of existing stores.

On mainland China, the retailer plans to open new stores in Jinshazhou, Guangzhou and Zhuhai during H2. It also plans to renovate the Shenzhen East Lake store into the first AEON STYLE on the mainland, building on the banner's success in Hong Kong.

Circle K in Hong Kong, operated by Convenience Retail Asia (CRA), has posted an impressive set of results for the first six month ending 30 June. This was mainly driven by continued focus on digital and creative marketing strategies.

Comparable store sales increase of 4.4%

CRA ended the first half with 332 Circle K stores in Hong Kong, one additional store compared to the same period last year. Two new stores opened and two closed during the first six months this year. While network expansion was static, Circle K's comparable store sales increased 4.4% YoY. This contributed to total sales of HKD2,061m (US$262.5m) versus HKD1,962m (US$249.9m) last year.

Earlier this year, we highlighted how OK Stamp It, a loyalty app that provides deals and offers to members, is central to CRA's overall business strategy. This has proved to be the case in H1, as the eCRM platform continued to drive repeat purchases, as well as online traffic to brick-and-mortar stores.

...OK Stamp It promotions

Since April, the Group has launched three summer promotions for OK Stamp It members. The first initiative was the return of the popular Shake Shake Lucky Star game. OK Stamp It then collaborated with Zoff (a Japanese eyewear chain that CRA operates in HK) to offer free sunglasses for the first 1,000 members who purchased newly imported ice cream brands from Japan and Korea. The third and most recent promotion was a World Cup-themed game, which offered 100 grand prizes of Cathay Holiday coupons valued at HKD10,000 (US$1,274) each.

H2 outlook: on track for strong performance

CRA recognises some underlying macro-economic trends in the market: consumer retail volume remains flat, depreciation of CNY is impacting cost of goods and high labour and rental costs will continue. To combat these challenges and drive future growth, the retailer is committed to its O2O business model, offering customers Easy, Fast & Simple (EFS) and Always Something New (ASN).


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Watsons launches new makeup concept store in China through its partnership with L’Oréal.

Watsons launches new makeup concept store in China

A.S. Watson has partnered with L’Oréal to launch its new makeup concept store in China under the fascia "Colorlab by Watsons".

The retailer opened its first Colorlab store in Shenzhen in January but plans to roll-out a further 50 across China by the end of 2018.

The stores offer an experience-led beauty space, with makeup specialists on hand to offer advice and expertise. The space allows shoppers to sample a wide range of colour cosmetics.

Fixtures dedicated to L’Oréal Paris and Maybelline, two of L’Oréal's most popular brands, account for over 30% of the sales area, and stand out in fixtures exclusive to this format.

Malina Ngai, Group Chief Operating Officer at A.S. Watson Group commented on the new concept, “Makeup was identified as a huge growth area for Watsons and working with L’Oréal on the development of this new store concept meant that we had the expertise of an established makeup supplier at the forefront.”

A.S. Watson (45 seconds)

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