Retail News CRM

Author: Mei Ling Tan

  • Shopping drives Baidu growth

    Shopping drives Baidu growth

    Chinese search engine Baidu is experiencing rapid growth as more and more Chinese shop online.

    Releasing its September quarter sales results, the US Nasdaq-listed business says Online to Offline is driving a massive growth in mobile users, gross merchandise value and mobile map usage.

    “With mobile accounting for nearly two-thirds of Baidu’s search traffic and China squarely in a mobile age, Baidu is pioneering and redefining the mobile experience for users in China,” said Robin Li, chairman and CEO of Baidu.

    “We further extended the reach of our platform by deeply integrating and connecting search and maps with transaction services,” he said.

    Jennifer Li, Baidu’s CFO, said the momentum in transaction services gives the company confidence to continue investing.

    Mobile search monthly active users (MAUs) were 643 million for the month of September 2015, an increase of 26 per cent year on year. Mobile maps MAUs were 326 million for the month of September 2015, an increase of 34 per cent.

    And Gross merchandise value (GMV) for transaction services totalled RMB60.2 billion (US$9.5 billion) for the third quarter of 2015, an increase of 119 per cent year on year.

    The company’s payment service, Baidu Wallet reported a 520 per cent increase in activated accounts to reach 45 million at the end of September.

    Total revenues in the third quarter of 2015 were RMB 18.383 billion (US$2.892 billion), a 36 per cent increase from the corresponding period in 2014. Mobile revenue represented 54 per cent of total revenues for the third quarter of 2015, compared to 37 per cent for the corresponding period in 2014.

    Operating profit in the third quarter of 2015 was RMB2.512 billion ($395.2 million), a 35.9 per cent decrease from the corresponding period in 2014.

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  • Siam Makro eyes Myanmar, Vietnam, Indonesia

    Siam Makro eyes Myanmar, Vietnam, Indonesia

    Thai retailer Siam Makro says it is keen to enter Myanmar, one of three key Southeast Asian markets it considers a priority.

    Siam Makro, which operates the Makro-branded cash-and-carry stores, has confirmed to the Bangkok Post newspaper that it has completed a feasibility study on the fast-deregulating Myanmar market.

    CEO Suchada Ithijarukul said the company had met with the Thai ambassador in Yangon to explore procedures for entering the country.

    “We have conducted a feasibility study on Makro’s market opportunities in many Asean countries, with Myanmar, Vietnam and Indonesia being the priority destinations,” she said.

    “Siam Makro is studying Myanmar consumer behaviour and foreign investment laws. If the regulations are clear, it is ready to open its first store immediately.”

    Siam Makro is part of the powerful Thai conglomerate Charoen Pokphan Group.

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  • Joy City wins mall accolade

    Joy City wins mall accolade

    Joy City Property has scooped two honours in the ICSC China Shopping Centre Awards at the 2015 Recon Asia-Pacific convention.

    Yantai Joy City’s new media marketing campaign, New Year Red Packets won a gold award in the Emerging Digital Technology category, and Tianjin Joy City’s O2O marketing initiative, Liangshiju took a silver award in the New Retail Concepts category.

    “It is noteworthy that Yantai Joy City not only pioneered the combination of WeChat Red Packets and payment methods through the New Year Red Packets, but also achieved mutual benefits for itself, its tenants and customers with the innovative marketing campaign,” said a Joy City spokesman.

    Meanwhile, Tianjin Joy City’s Liangshiju is China’s first O2O customer loyalty platform to adapt to the internet. Consisting of its online and offline stores, the O2O customer loyalty platform encourages purchases on mobile applications and effectively guides the customers to the company’s stores with gift redemption and induce them to become its members.

    The initiative has increased the membership significantly and at the same time boosted sales with accumulation and redemption of bonus points earned through purchases. The O2O initiative has enabled the company to surpass geographical limitations and revolutionise the conventional service of traditional customer membership centres.

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  • Inside Starbucks Taiwan new concept

    Inside Starbucks Taiwan new concept

    The design team behind the new generation Starbucks Taiwan Longmen concept store set out to create a “theatre for coffee”.

    The new store features Starbucks Reserve coffees and is located in one of the busiest shopping and fashion districts in the city of Taipei.

    Starbucks Taiwan new concept 5
    “We wanted to elevate the Reserve coffee experience for customers and inspire them with our coffee passion,” said Wen Lin, project leader, Starbucks Taiwan.

    “A Reserve coffee bar is located in the center of the store or ‘center stage,’ so customers can watch partners handcrafting beverages from every vantage point.”

    Starbucks Taiwan new concept 2

    Behind the coffee bar is a central column with an abstract graphic, created from blackened metal with laser cutouts in a coffee bean pattern. Diffused lighting inside the column creates a lantern effect.

    “The column draws the eye to the bar to offer an extra layer of interest and evokes the romance of enjoying our coffee,” said Claudia Lee, director, Starbucks Store Design.

    Starbucks Taiwan new concept 6

    Visual representations of the coffee journey are featured in select areas throughout the store, highlighting the regions where coffee is harvested. This includes a 14-meter coffee belt map, created by Taiwanese wood veneer artist, Sandy Lee.

    “We want our customers to have a different visual experience every time they visit our store,” said Lin.

    The store’s design takes advantage of existing architectural elements such as an irregular-shaped floor plan and various ceiling heights to create a strong spatial look and feel. Elevated platforms were crafted into seating areas for customers, where they can look down at what’s taking place at the coffee bar. Taiwanese-designed wood tables and chairs round out inside seating and reflect local styles.

    Starbucks Taiwan new concept 3

    “We selected stools and cafe chairs that have a handcrafted quality to complement the store aesthetic,” said Percy Lee, senior design manager, Starbucks Store Design.

    “The terrazzo floor tile is the same that is traditionally found in residential buildings. This connects customers to local culture and provides a sense of familiarity and comfort when relaxing in the store.”

    Starbucks Taiwan new concept 7

    Featuring a variety of coffee brewing methods, the Longmen store is the first Starbucks in Taiwan to offer both Clover and the Black Eagle machines. Baristas will also offer coffee using the Pour Over method with a three-cup station designed and made by Iron Wang, a local Taiwanese artist who specialises in coffee brewing equipment.

    To pair with coffee, the store’s food menu includes creations by Sadaharu Aoki, a Japanese pastry chef, who owns boutiques in Paris, Taipei, Tokyo and additional cities in Japan. Along with sandwiches and desserts, customers will find Opera, a French sponge cake, created specifically for the store and made with Starbucks Colombia coffee.

  • South Korea retail sales surge

    South Korea retail sales surge

    South Korea retail sales rose to their highest level in four months in September, as Koreans put the Mers scare behind them and ventured back into stores.

    Data from Statistics Korea show retail sales totalled 31.13 trillion won (US$27.32 billion) during the month, a 4.1 per cent increase on September 2014.

    Department store and discount store sales started to slide in June when the Middle East Respiratory Syndrome (Mers) crisis peaked. From spending of 31.43 trillion won in May, sales fell to 29.35 trillion won in June and 29.45 trillion won in August.

    Rising sales of food, cosmetics and apparel led the rebound in September. Food and beverage sales rose 14.5 per cent, cosmetic sales rose 3.9 per cent and clothing by 0.6 per cent year on year.

    Furniture sales, too, rebounded – up 3.7 per cent.

    Spending at convenience stores soared 32.8 per cent, at discount department stores by 10.4 per cent and in department stores by 5.7 per cent.

    Online shopping spending rose by 18.3 per cent to 4.32 trillion won, accounting for 13.9 per cent of the nation’s total retail spend.

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  • 11.11.2015: A new twist to Asian retailing’s biggest day

    11.11.2015: A new twist to Asian retailing’s biggest day

    China’s Singles Day – 11.11.2015 –  the biggest shopping festival in the world, will no doubt once again break international eCommerce records this Wednesday.

    But while watching numbers tick astronomically higher is exciting, retailers should be paying attention to what Alibaba is doing differently this year: omnichannel.

    For the first time, Alibaba is bringing part of Singles Day (also known as Double 11, or Guangun Jie) offline. It has promised that more than 1000 retail brands encompassing over 180,000 stores across 330 cities in China will join the 11.11 Festival.

    Customers will be able to price match in-store goods with TMall discounts. Some areas will be able to deliver products within two hours, essentially turning stores into distribution centres.

    Much like Alibaba’s 2014 mobile shopping push made mCommerce a “new normal,” you can expect 2015 to begin a boom in omnichannel. Retailers will do well to begin strategising through a smart integration of their physical stores and digital commerce now.

    Here are two guidelines to consider when reassessing how your physical and digital presences can complement each other in this new omnichannel world:

    Make the store a customer solution

    The consumer does not make a distinction between a brand offline and online – and neither should retailers. Physical stores create interesting opportunities to reduce customer friction points or quickly resolve customer problems. Extend in-store services to add incremental customer value or create a good atmosphere.

    We recently helped GrandVision, the world’s largest eyewear conglomerate, create a retail experience centered around eye care. They wanted to emphasize their medical-grade professionalism and commitment to demystifying eye care for consumers.

    Design points such as having an eye-testing facility placed in the middle of each store emphasises their dedication to this cause, and informational content placed across all digital channels means customers could empower and inform themselves across desktop, mobile or in-store digital panels.

    By consolidating all consumer interactions with GrandVision into one platform, everything from booking an eye exam to buying lenses have been made seamless both offline and on. The one view of consumers helps give store associates the tools they need to better understand customer motivations, provide support and make the store an integral part of customer interactions with the brand.

    Make your store experiential

    Retail used to be rooted in the transaction, but now that technology has decoupled transactions from physical spaces, retailers have tremendous freedom to build a memorable experience in stores.

    We helped Audi design an interactive experience for its flagship showroom in Beijing, using screens and responsive content to let customers cycle through endless customisations of their ideal Audi cars. The Audi City showroom cut down on costly retail rents while allowing Audi to showcase all inventory and imprint its brand message of “Vorsprung durch Technik (advancement through technology).”

    Physical store experiences properly integrated with digital are part of the equation for brand differentiation and continued relevance. Consumers go seamlessly from online to offline and back. Retailers need to learn to do the same.

  • Mobikon partners with BPI for Philippines foray

    Mobikon partners with BPI for Philippines foray

    Singapore-based Mobikon has tied up with Bank of the Philippines Islands (BPI) in Manila to offer its customer engagement platform to restaurants.

    The tie up will add a repertoire of over 300 restaurants in Mobikon’s network and strengthen its presence in South East Asia. Currently, the company has 1500 restaurants across India, Singapore, Malaysia, Macau, Philippines, and Dubai.

    “Apart from organic growth for the company, one of the key pivot in our strategy is where we target larger brand as a reference point for other brands to follow. The rewards program given out by banks is commoditised. We saw an opportunity for a win-win tripartite partnership with BPI,” said Anuj Jain, vice-president, Asia-Pacific, Mobikon. BPI confirmed the tie up but declined to discuss further details in response to an email query from ET.

    Through this contract-based partnership, BPI will provide Mobikon’s customer relationship management platform to restaurants on a tablet as a ready-to-use value-added solution. In turn, BPI will advertise its offering on Mobikon’s platform to restaurant brands as self-promotion and to strengthen relationships.

    Currently, Mobikon works with 100 restaurants in Manila. Mobikon is also in talks with other leading banks in India and other markets and also exploring strategic partnerships with mPOS & cloud POS companies.

    Within this year, Mobikon has raised close to $4 million from Jungle Ventures, Life-.Sreda and Qualgro. It strengthened its market reach in Singapore this August acquiring ‘Triibe’, a customer feedback platform in South East Asian markets.

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  • Aeropostale unveils more expansion in Asia and EMEA region

    Aeropostale unveils more expansion in Asia and EMEA region

    Aeropostale, Inc., an American mall-based specialty retailer of casual apparel for young women and men, has announced additional expansion plans in Asia and the EMEA region. Through two new licensing agreements, Aeropostale will launch in Thailand and Egypt over the next five years, it said in a press release.

    Julian R. Geiger, CEO of Aeropostale, said, “Aeropostale’s international expansion began in Asia and the Middle East and it is with great pleasure that we announce further expansion across these key regions. Thailand and Egypt will be important markets as we continue to expand globally across Asia, the Middle East and Africa. We are confident that our partnerships with Robinson Department Store and Q and A Retail Company will ensure that the Aeropostale brand will continue to thrive and prosper internationally.”

    The company has signed a licensing agreement with Robinson Department Store Public Company Limited to open approximately 40 standalone and shop-in-shop locations over the next five years in Thailand. The first Aeropostale location in Thailand will open in the Robinson Department Store in Sriracha.

    Paresh Chauhan, Executive Vice President of International Brands at Robinson Department Store, said, “Robinson Department Store is very excited to bring Aeropostale to the Thailand market place, with the brand’s strong combination of trend-right merchandise at compelling prices. We hope to emulate Aeropostale’s success and be the leaders in teen fashion in our market.”

    Aeropostale has also signed a licensing agreement with Q and A Retail Company to open approximately 10 standalone stores over the next five years in Egypt.

    “We are eager to partner with Aeropostale to bring this iconic brand to North Africa for the first time. We are confident that the strength of the Aeropostale brand will resonate with the consumers of Egypt and we look forward to continuing our expansion throughout the region over the next several years,” said Ayman Seoudy, Director of Q&A Retail Company.

    Aeropostale’s expansion plans in Thailand and Egypt are planned to begin in early 2016, the release said. (SH)

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  • BPI books P13.8-b net profit

    BPI books P13.8-b net profit

    Bank of the Philippine Islands, the third-largest bank in the country, posted an 8-percent increase in net income in the first nine months to P13.84 billion from P12.8 billion year-on-year on the strength of its core businesses.

    Total revenues increased 9 percent or P3.67 billion to P44.1 billion year-on-year as both net interest income and non-interest income grew P2.98 billion and P0.68 billion, respectively.

    Operating expenses rose 6.7 percent to P22.89 billion on year, a slower rate than revenue growth. As a result, the bank’s cost-to-income ratio improved to 51.9 percent from 53.1 percent a year ago. Return on equity decreased to 12.6 percent, from last year’s 13.3 percent.

    Both total loans and total deposits rose in double digits year-on-year. Total loans stood at P780.07 billion, an increase of 11.2 percent on year. Corporate loans accounted for 76.6 percent while retail loans stood at 23.4 percent.

    “Gross 90-day non-performing loans rose slightly to 1.9 percent from 1.8 percent of total loans, while loan loss cover remained 107 percent. Total deposits stood at P1.18 trillion, up 13.3 percent higher year-on-year. CASA ratio ended the quarter at 72.5 percent,” the bank said.

    Total assets during the period stood at P1.41 trillion, 8.8 percent or P113.78 billion higher than that of the same period last year.

    Investment securities closed at P303.28 billion, a 15.2 percent hike year-on-year. The bank’s investment securities remained mostly held-to-maturity, at P240.87 billion.

    Capital, net of cash dividends of P3.54 billion paid to shareholders on Sept. 2, 2015, ended at P150.44 billion. This represents a 9.3-percent growth in total capital versus September last year.

    Capital adequacy ratio was at 14.9 percent from 15.7 percent a year ago. CET1 stood at 14.0 percent.

    Earlier in the year, the Asian Banker named BPI as the Best Retail Bank in the Philippines for 2015. BPI also received the Best Electronic Delivery Channel award during the inaugural Bank Marketing Awards night, organized by the Bank Marketing Association of the Philippines.

    The award recognizes the bank that successfully implemented the most innovative electronic delivery systems and achieved the desired results in terms of usage and acceptance.

    BPI, the first bank in the Philippines and in Southeast Asia, is a commercial bank with an expanded banking license. BPI’s services include consumer banking and lending, asset management, insurance, securities brokerage and distribution, foreign exchange, leasing, and corporate and investment banking.

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  • DFS Group looks for new wine business leader

    DFS Group looks for new wine business leader

    Christian Pillsbury has left DFS Group where he headed up DFS Group’s international wine business in Hong Kong to join Coravin Inc., the maker of Coravin Wine Systems as Director of Sales, Asia Pacific with immediate effect.

    According to a statement by Coravin, Pillsbury oversaw operations across more than ten countries and 120 retail outlets at DFS Group and prior to that was the founder of Applied Wine, a first of its kind company devoted to helping restaurants make wine a core part of their business.

    Commenting on his new appointment, Pillsbury said: “Asia is becoming an exciting destination for wine and is seeing tremendous growth.

    “Coravin has transformed the way wine is sold, served, and enjoyed in both North America and Europe and I am honoured to introduce the brand to wine lovers all over Asia.

    When contacted to see if a replacement has been found, a DFS spokesperson told: “We’ll announce Christian’s replacement soon.”DFS has recently been been looking to fill a position for a new senior member to join its global wine team based in Hong Kong, to work across 11 countries and manage a team of experienced travel retail professionals.

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  • John Lewis going Dutch with de Bijenkorf shop-in-shops

    John Lewis going Dutch with de Bijenkorf shop-in-shops

    UK department store chain John Lewis has announced its first physical foray into the European retail market, with seven stores planned for the Netherlands over the next two years.

    John Lewis has announced it will have a physical presence in Europe by opening shop-in-shops within seven branches of Dutch department store, de Bijenkorf. Starting with openings in Amsterdam, Rotterdam and The Hague flagships in spring 2016, the UK business will then enter Eindhoven and Utrecht by the end of next year, and in Amstelveen and Maastricht in 2017.

    Having sold and shipped its goods in Europe for a number of years, via its online operations, John Lewis’s new strategy is the first significant sign that it sees its next stage of growth coming from outside the UK.

    It comes after John Lewis opened 14 shop-in-shops across Singapore and the Philippines earlier this year, following the launch of a similar format in South Korea in 2014.

    Andy Street, managing director at John Lewis, called de Bijenkorf “the perfect partner to enable us to bring John Lewis to a new customer base and country”.

    “Our existing shop-in-shops in Singapore, the Philippines and South Korea have been well received and are trading well,” he added.

    “Whilst we remain committed to our UK physical expansion we hope to announce more international collaborations in 2016.”

    The John Lewis departments will be between 300 sq ft and 500 sq ft, with the retailer’s in-house store design team responsible for designing the look and feel of the retail space.

  • 40 per cent of online trade in China fake or substandard

    Chinese lawmakers have been urged to tighten controls on online trade after a report suggested counterfeit and low quality goods accounted for just over 40 per cent of sales.

    The report on the implementation of the latest iteration of the Law on the Protection of the Rights and Interests of Consumers also notes that China is now the biggest online marketplace in the world, overtaking the $300bn US market, and was valued at 2.8trn yuan ($442bn) last year.

    An article notes that complaints concerning online purchases rose 357 per cent to reach 77,800 last year, according to data from the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ).

    This has prompted calls for the Chinese government to bring in new legislation to govern e-commerce, particularly with regard to the rights of consumers and the responsibilities of retailers.

    The report (in Chinese) was presented at a plenary meeting of the National People’s Congress (NPC) Standing Committee, which was presided over by Chairman Zhang Dejiang.

    The revelations come as China’s online retail platforms, and particularly Alibaba, have come under intense scrutiny of late over counterfeit listings, and the measures taken by the sites to take them down.

    Earlier this year, the State Administration for Industry and Commerce (SAIC) accused Alibaba of being ‘lax’ in what it allows traders to sell on its online retail platforms, prompting a war of words between the company and Chinese government.

    Alibaba’s chief executive Daniel Zhang said during the company’s financial results conference last week that the company “remains committed to providing a trusted consumer experience with authentic products by driving merchants that peddle counterfeit products off our marketplaces.”

    .

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  • Hong Kong tenders five new retail contracts

    Hong Kong tenders five new retail contracts

    Hong Kong International Airport is currently tendering three retail contracts in the merchandise areas of fashion accessories, audio visual/electronics and gifts/souvenirs and toys.

    The first consists of a fashion or fashion accessories shop opportunity comprising 50sq m on Level 5 Departures in the North Satellite Concourse restricted area, where bids close on December 3.

    Another tender process is for an audio visual/electronics concession consisting of five shops, with four located on Level 7 in the Departures Check-in Hall, Terminal 1 non-restricted area. These outlets vary from between 18 to 70sq m in size.

    Another outlet comprising 48sq m which falls under the same contract is also located on Level 5 Arrivals in the Pre-Immigration Hall, Terminal 1 restricted area. The date for submission for offers for this five-outlet contract is December 10, 2015.

    Tenders also close for a small 48sq m gifts/souvenir/toy concession at Hong Kong Airport tomorrow afternoon. This is located on Level 5 Departures in the North Satellite Concourse restricted area.

    The airport describes all of these opportunities as ‘extraordinary’ and in ‘premium locations’.

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  • Canon Increases Investment in Singapore with New Office

    Canon Increases Investment in Singapore with New Office

    Canon, the global leader in photographic and digital imaging solutions, today announced the company’s official move to Galaxis, a Platinum Green Mark Building located in One North. Showcasing state-of-the-art facilities and powered by Canon office solutions, the new premise promises to be a one-stop destination for its customers’ imaging needs.

    Putting the customer at the centre of the new office, Canon has invested SGD$20million to build the Canon Delight Hub, an integrated customer engagement hub. This hub brings together all of Canon’s businesses – from consumer imaging to business solutions, creating a more centralised, holistic customer experience across Canon’s suite of solutions.

    These customer-centric investments in Singapore speak to Canon’s ambitions in South and Southeast Asia. Mr. Kensaku Konishi, President and CEO, Canon Singapore: “We continually seek to invest in this region to increase our capabilities and footprint in line with the tremendous growth we expect from the South and Southeast Asia region.”

    Housed in this facility is the enhanced Customer Care Centre, which provides customers access to try out the latest Canon consumer products as well as the same comprehensive customer service. To better meet the service and repair needs of customers, the new Customer Care Centre offers improved testing and interactive facilities, such as a 30m darkroom, one of the longest darkrooms for lens testing in the region.

    As a keen advocate of photography, Canon established the Canon Imaging Academy to help and teach Canon users to do more with their digital cameras. The new Canon Imaging Academy today offers wider training facilities, including a studio catered to the training needs of both budding and professional photographers.

    For the first time ever, Canon’s wide range of solutions is housed in a single location. For example, the Production Printing Excellence Centre and the Business Excellence Centre showcases Canon’s suite of innovative solutions aimed at improving enterprise productivity, efficiency and security. Potential corporate customers will be able to experience first-hand the comprehensive range of products ranging from large format printers (imagePROGRAF), digital production printers (Oce VarioPrint), digital multi-functional devices (imageRUNNER), production inkjet printer (DreamLabo 5000) and surveillance cameras.

    Canon’s move to the Galaxis, a Platinum Green Mark Building, marks a new milestone as the company continues to grow alongside Singapore. With this new office also functioning as a showcase for the modern office and a proof of concept lab, Canon will continue achieving sustainable growth and engaging with the community across the region.

    Since it was founded in 1979, Canon Singapore has continued to delight Singaporeans with its products and attention to customer service. In line with its kyosei corporate philosophy of living and working together for the common good, Canon is also an active contributor to the local community, supporting diverse arts, environment and sports programmes.

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  • L’Oreal sales soar 13.2% to $20.4bn in first 9 months

    L’Oreal sales soar 13.2% to $20.4bn in first 9 months

    L’Oréal has released its nine-months sales results pointing to strengthened growth in the North American Consumer Products Division; maintained growth in Western Europe; a temporary third quarter slowdown for L’Oréal Luxe in Asia; strong e-commerce sales (projected at +€1bn in 2015); a slowdown in travel retail; and ‘significant’ sales and profit growth.

    Commenting on the figures – including the top line €18.76bn ($20.4bn) in total 9-month sales – Jean-Paul Agon, Chairman and CEO of L’Oréal, said: “At the end of September, the Group’s reported growth is strong, at +13.2%, still supported by a very positive currency effect.

    “In the third quarter, the Consumer Products Division is confirming the gradual strengthening of its growth, notably through strong momentum in make-up with its three brands: Maybelline, L’Oréal Paris and NYX. The Active Cosmetics Division continues to forge ahead and the Professional Products Division keeps outperforming a lacklustre market.

    “L’Oréal Luxe experienced a temporary slowdown as a result of market turbulence over the summer in Asia, in Hong Kong and in Travel Retail. By geographic zone, North America’s growth is gradually increasing and Western Europe confirms its positive trend. In the third quarter, the New Markets have been hampered by the difficult Brazilian market, market turbulence in Asia and the taking over of agents’ contracts in the Middle East. In China, sales growth is in line with earlier quarters.”

    Loreal 9m sales 2015

    Agon, added that ‘despite a global context that is still volatile’ the company remains confident for the year as a whole. He said: “The beauty market remains dynamic. In each Division, our brands are pushing forward with successes such as Maybelline and NYX in the Consumer Products Division, Yves Saint Laurent, Kiehl’s and Urban Decay at L’Oréal Luxe, Redken in the Professional Products Division and La Roche-Posay at Active Cosmetics.

    “Finally, the acceleration of our digital transformation is making us stronger, in particular with the rapid increase (+40%) of our e-commerce sales which should significantly exceed one billion euros this year. We are confirming our ambition to outperform once again the beauty market in 2015 and to achieve significant growth in both sales and profits.”

    Looking at the first nine-months sales to September 30, the company said that on a like-for-like basis and based on a comparable structure and identical exchange rates, sales growth of the L’Oréal group would have been +3.7%. It adds that the net impact of changes in scope of consolidation was +1.2%, while growth at constant exchange rates registered +4.9%.

    The company said that currency fluctuations actually had a positive impact of +8.3% and if September-end exchange rates (€1 at $1.12) are extrapolated up to December 31, then the impact of currency fluctuations would be +6.7% for the whole of 2015.

    L'Oreal 2014 2015 sales

    Turning to the product divisions, L’Oréal said that at the end of September, the Professional Products Division posted growth of +3.2% like-for-like and +13.4% based on reported figures.

    The company said: “Hair care is the largest contributor to growth, powerfully driven by the latest innovations, such as Thérapiste by Kérastase, Pro Fiber by L’Oréal Professionnel, and Frizz Dismiss by Redken. The dynamic trend in hair colour is continuing across all brands.

    “Professional skincare with Carita is expanding rapidly in Western Europe. All the geographic Zones are growing. Eastern Europe is accelerating, while Brazil is slowing the growth rate in Latin America.”

    L’Oréal Consumer Division

    As for the Consumer Products division, the beauty giant recorded a rise of +2.3% like-for-like and +11.2% based on reported figures. The company commented that gradual improvement growth trend continues and thanks to the new momentum of Maybelline, the strong expansion of NYX, and the success of L’Oréal Paris, this division is strengthening its leadership in the make-up market.

    L’Oréal also notes that hair care is winning market share, thanks notably to L’Oréal Paris. For Garnier, the Ultimate Blends’ successful launch process has continued in many European countries. At the same time, the division is outperforming the markets in Eastern Europe, Asia, Pacific, Africa and the Middle East, while the ‘strong make-up dynamic’ is said to be accelerating the division’s growth in the US, while e-commerce is growing fast across all Zones.

    Meanwhile, L’Oréal Luxe posted growth of +5.8% like-for-like and +17.9% based on reported figures. Within the more detailed picture, Yves Saint Laurent grew strongly, driven by make-up, men’s fragrances with L’Homme and women’s fragrances with Black Opium. L’Oréal added that Giorgio Armani remained dynamic across all geographic Zones.

    The company added: “Urban Decay is accelerating worldwide with the high-profile launch of the Naked Smoky palette and is building a global beauty offering with initiatives in foundations and lipstick. Kiehl’s is launching Daily Reviving Oil Concentrate and continuing its double-digit growth.

    “Growth at Lancôme is being driven by market share gains in Europe, the success of the fragrances La vie est belle, Miracle and the newly released La Nuit Trésor; Grandiôse and Hypnôse Volume à Porter mascaras; and the acceleration of its Génifique facial skincare.”

    L’Oréal adds that despite a market that slowed in the third quarter in Asia and in Travel Retail, L’Oréal Luxe has strengthened its worldwide position with significant gains in Western Europe, in Asia, Pacific, in the Middle East and in Latin America.

    Active Cosmetics division

    The company’s Active Cosmetics division also improved its performance further with strong growth of +7.3% like-for-like and +9.7% based on reported figures. L’Oréal reported that Vichy is innovating with Neovadiol Substitutive Complex Serum, a formula that acts on skin changes linked to menopause.

    At the same time, Roche-Posay is renewing its expert franchise for oily skin with the launch of Effaclar K(+). The company adds that the brand is continuing to post double-digit growth in all geographic Zones, with ‘outstanding performances’ in France, Brazil and China. The successful international roll-out of SkinCeuticals is continuing.

    The beauty company also reported that all geographic zones continue to contribute to growth, with sales accelerating in the third quarter and new markets maintaining growth at more than 10%.

    Western Europe recorded growth of +2.1% like-for-like and +4.5% based on reported figures, with L’Oréal Luxe is continuing to act as a growth driver. Garnier is also said to be winning market share in hair care and skincare, while L’Oréal is continuing to outperform the market in Germany and the UK thanks to L’Oréal Luxe.

    In North America L’Oréal posted growth of +3.0% like-for-like and +25.4% based on reported figures. Both the Active Cosmetics and Professional Products Divisions drove growth and notably thanks to the La Roche-Posay and Redken brands.

    Kiehl’s and Urban Decay also contributed to the development of L’Oréal Luxe, while the Consumer Products Division also grew with good make-up contributions from L’Oréal Paris, Maybelline and above all NYX, which is described as ‘growing at a remarkable pace’. Meanwhile, the Body Shop recorded growth of +2.0% like-for-like and +12.6% based on reported figures.

    Commenting on other markets, the company reported a mixed picture, beginning with the Asia and Pacific territories: “At the end of September, L’Oréal posted growth of +4.4% like-for-like and +21.9% based on reported figures. Kiehl’s, Yves Saint Laurent and Giorgio Armani are contributing to the dynamism of L’Oréal Luxe, in a context of slower third-quarter growth in Hong Kong and Travel Retail Asia.

    “The Consumer Products Division is performing well in India, Australia and Thailand. In China, growth at L’Oréal Paris is accelerating, while Magic is undergoing a transitional period. The Active Cosmetics Division is growing strongly, thanks to the success of La Roche-Posay.”

    Tough Brazilian market

    By contrast, in Latin America sales grew by +5.5% like-for-like and by +4.7% based on reported figures. Excluding Brazil, sales achieved double-digit growth, thanks to L’Oréal Paris, Maybelline and Lancôme, although the company says that the Brazilian market is being held back by a very difficult economic environment and by the reform of the IPI (Tax on Industrialised Products).

    Looking at Eastern Europe, L’Oréal said that the zone posted figures of +9.5% like-for-like and -4.1% based on reported figures. The Consumer Products and Professional Products Divisions recorded double-digit growth, boosted by Russia, Turkey and Ukraine.

    As for Africa and the Middle East, sales growth amounted to +9.8% like-for-like and +28.1% based on reported figures. L’Oréal said: “The reorganisation of part of our distribution network in the Gulf States caused a temporary growth slowdown in the third quarter. The Group is strengthening its positions at a time when most markets in the Zone are seeing their growth rates decelerate.

    “Egypt and Saudi Arabia are still posting strong performances. L’Oréal Paris and Garnier are gaining market share. Yves Saint Laurent, Giorgio Armani, Kérastase and La Roche-Posay are also recording solid growth rates.”

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