How did Watsons become the leader in cosmetics products?
If you have ever been to China, there is no way you have missed Watsons retail stores. Even if you don’t want to buy beauty products, you are going to walk by one of the chain’s many stores.
Watsons’ focus on Asia
You cannot really understand the huge sucess of Watsons’ without some key figures . We can always get the message better with number, it’s like if I give you bags with bunch of dollars.
What is Watsons’s?
- More than 1,400 drugstores
- 4,800 beauty stores in Asia and Europe
- Number of stores in China has gone up from 500 in 2009 to nearly 2,500 in 2015
- 500 stores are expected to be open every year
Watsons is A.S. Watson Group flagship health and beauty retail brand. With headquarters in Hong Kong, the firm has an easy access to the Asian market – but it has also expanded in the rest of the world.
It is recognised as one of the biggest players in Asia. Watsons has indeed been ranked 25th in the Top 100 China Brands in 2014. It is also the first pharmacy/drugstore brand in Asia among Asia’s Top 1,000 Brands for 6 consecutive years… and maybe more? Watsons’ success in China is undeniable; let’s see how the brand made it happen.
The right audience
We’ve seen that high end brands are having troubles in China, in many different sectors.
If Watsons is not impacted by this slowdown, it is because it targets another audience: lower and middle classes. And the latter looks promising: with an increasing spending power and a growing enthusiasm for beauty and health products, it seems like the perfect fit for the retailer. Also, Watsons is covering a large territory in the country: it is present in about 380 cities in China.
The loyal customer base
More than just targeting the right audience, Watsons wants to make its clientele loyal. And it has: the retail brand operates a loyalty card membership already used by 50 million customers. This number is growing every day, as the brand attracts 800,000 to one million members each month.
Apart from having a large range of products –from both local and international brands– or providing with many promotions, Watsons goes even further in its strategy in order to appeal to Chinese consumers. Indeed, the retailer uses its own-brand products to satisfy its customers’ needs and even changes the formula of these products. The latter are adapted to geographical differences; for example, products made for northern China are designed to suits the dryer and colder weather.
Watsons was featured among the “Top 100 Annual Weibo Influence Power” in 2013 already, a sign that the retailer understood pretty early that social media is important to consumers (featuring in this ranking reflects the high engagement level which a brand has generated). Today, most of the content published on its Weibo page is promotional content (offers, vouchers etc).
One thing to notice is that Watsons takes advantage of today’s O2O (Online to offline) development: almost all of the posts published online feature a QR code. These codes are used by many brands in order to bring Internet users in physical stores, through vouchers or discounts, and Watsons is so exception.
Other than social media, the retail brand is also playing on the e-commerce arena. Watsons has its own online store but it has also collaborated with giant e-commerce platforms Amazon.cn and JD.com in order to reach a larger audience.
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