Drawing inspiration from Europe, a Singapore Christmas village featuring pop-up stores from 25 brands, will make its debut at the annual Orchard Road light-up this year.
Outside Ngee Ann City from November 25 to Christmas Day, the village will feature such brands as Fish & Co, Starbucks and Toast Box, with Singapore’s first-ever duplex carousel.
“Christmas villages are very popular in Europe,” says Orchard Road Business Association (Orba) chairman Mark Shaw. “It will be a good opportunity for retailers to reach out to customers.”
Running from November 11 to January 1, the ninth edition of Christmas on a Great Street will be themed “Endless Wonder”. Highlights will include the event’s highest-ever main arch, reaching 12m, outside Ion Orchard and a 5m Enchanted Tree installation outside Wisma Atria.
Activities along the 2.8km stretch between Plaza Singapura and Tanglin Mall will start earlier this year, at 3pm rather than 6.30. There will be daily performances from bands, carol singers and roving cosplayers.
Shaw says LED lights will enhance the installations even in the afternoon. Each of the 1200 hanging globes to be strung on trees comprise coloured fabric intertwined with LED fairy lights.
Other attractions include the Walk of Wonder, a 12m-high 20m tunnel outside Forum the Shopping Mall made from reflective fabric and fairy lights.
A 4.5m Tree of Time in front of Ngee Ann City will be topped with a countdown-to-Christmas Day clock, and will be the backdrop to a Christmas Eve concert featuring bands and a midnight pyrotechnics show.
Orba expects the event to draw 3.6 million visitors this year. While this appears to be a sharp drop from the 6 million visitors counted last year, the association says it is introducing a new calculation method. In previous years, anyone who entered the event area would be counted as a visitor, but from this year visitors will be asked if they are there specifically for the event.
A “design incubator” to showcase home-grown brands and designers will open in the heart of Orchard Road by the end of next year.
This was revealed by Trade and Industry Minister S Iswaran at the Singapore Retail Industry Conference on Friday.
He said the design incubator, to be run by retailer Naiise, will house a retail showcase and incubation space under one roof. It is expected to feature more than 60 local brands covering fashion, lifestyle products and souvenirs, and is being supported by the Singapore Tourism Board, Spring Singapore and JTC. Helping local brands go global is one of the key strategies of the Retail Industry Transformation Map launched last year.
Local brands and designers may soon also be able to use department stores as a launchpad to showcase their products, boost their profile and expand market access. Iswaran said Spring is working with department stores to explore the incubation of local and regional designers.
Also, the Singapore Retail Association (SRA) is embarking on a project under Spring’s Local Enterprise and Association Development Plus (Lead+) program to transform and upgrade its capabilities, the minister said. It will undertake specific initiatives to drive the adoption of retail and backend technologies among retailers, including the use of the “endless aisle” which enables retailers to showcase all their products without having to stock them in their physical stores.
SRA will develop a website mobile portal and enhance its GoSpree shopping app launched in June.
Government agencies are also looking at ways to enliven Orchard Road as a shopping and lifestyle destination, said Iswaran. He said a steering committee overseeing this has been set up, co-chaired by three government ministers.
Other initiatives on the table include enhanced programming along the pedestrian malls, pop-up and permanent activations at available spaces, and making the shopping belt more pedestrian friendly.
Iswaran said the retail industry is an important part of the republic’s economy. The sector comprises 23,000 retail establishments that chalk up about S$35 billion (US$26 billion) in annual receipts and contributed 1.4 per cent to Singapore’s GDP last year.
As another resource for retailers, the Retail Centre of Excellence will be launched at the Singapore Management University’s Lee Kong Chian School of Business next month. It will partner retailers in addressing the gaps and challenges of the fast-changing retail landscape, Iswaran said.
Smoking will be prohibited in all public spaces in the Orchard Road area — from Tanglin to Dhoby Ghaut — from July 1 next year, said the National Environment Agency (NEA) on Friday (June 30).
The existing 16 smoking corners, which exist within food retail establishments in the area, will be removed by June 30 next year. That means smoking will be permitted only at designated smoking areas within the Orchard Road smoke-free precinct, which is bordered by Tanglin Road to the west, Dhoby Ghaut MRT station to the east, and Goodwood Park Hotel to the north.
There are currently five Government-owned designated smoking areas, which are part of an ongoing study led by the Ministry of Environment and Water Resources.
The NEA also announced on Friday that it will no longer accept applications for smoking corners in all food retail establishments islandwide. Existing smoking corners will be allowed to remain, unless the current licence is terminated or cancelled.
For Orchard Road, an “advisory approach” will be taken in the first three months after the no smoking ban kicks in, said the NEA. Those caught smoking in public areas will receive only verbal warnings between July 1 and Sept 30.
Enforcement action — a fine of up to S$1,0000 — will be taken against errant smokers in the zone from Oct 1 next year.
Building owners within the smoke-free zone in Orchard Road, however, have the option of building their own designated smoking areas, which must meet certain guidelines, like not being situated beside main thoroughfares, and come with cigarette butt canisters or litter bins with ash trays, and display smoking cessation messages.
The wait for Apple fans will be over soon. Apple Orchard Road – the official name of the Apple retail store here – will be opening its doors on May 27 at 10am. Close to midnight last night, workers were seen pasting the opening date on the white facade covering the front of the store at Knightsbridge mall.
It is not only the first Apple retail store in Singapore, but also the first one in South-east Asia. The store will open daily from 10am to 10pm.
News of the Apple retail store here first broke in October 2015, after a former tenant of the mall, the Pure Fitness gym chain, sent a letter to its members informing them of its closure to make room for the Apple store. Four other tenants were also moved.
In an exclusive interview during the opening of the Apple Dubai Mall store last month, Apple’s senior vice-president of retail Angela Ahrendts told: “We want to be on an iconic street, where people will naturally come, whether they are locals or tourists.”
This is especially so when it is the first store in the country and it allows Apple to build a beautiful signature store for that community, she said.
Retail experts said the Apple store’s location makes sense. Said Associate Professor Prem Shamdasani of the National University of Singapore Business School: “For more than a decade, Apple has been opening retail stores in very good locations in major cities globally to showcase its great products and enhance the brand experience for loyal fans and consumers.
“Singapore’s position as a vibrant and progressive global city in South-east Asia will help to reinforce Apple’s brand leadership in the region,” he said.
As of April, Apple has 495 retail stores in 20 countries.
Apart from selling Apple products such as iPhones, iPads and MacBooks, as well as accessories, the local Apple store will have staff who Apple calls Geniuses – technical personnel who specialise in troubleshooting and repairs of products.
Apple Orchard Road will also host hands-on sessions called Today at Apple, which launches in all Apple retail stores across the world this week.
Taught by Creative Pros, who are the liberal arts equivalent of Apple’s technical Geniuses, these free educational sessions focus on the features of Apple products and allow anyone to learn skills like photography, illustration or coding.
For the Singapore store, Apple has appointed 12 Singaporean creatives as Red Dot Heroes. They are people who have made a contribution in their fields like the arts, photography, music or film.
They include street photographer Aik Beng Chia and illustrator Kristal Melson (see their profiles below), as well as film-maker Boo Junfeng and local singer Sezairi.
These Singaporean creatives are similar to Apple’s Creative Pros and some of them will conduct workshops in Apple Orchard Road.
Experts also see possible learning points for the retail industry from the Apple store.
“When you want to control the store experience, you need to own and operate it,” said Mr Clement Teo, principal analyst at market research firm Ovum.
“The bar for customer service in Apple stores and online is high, supported by trained Geniuses and expert advice from Creative Pros to help customers get the most out of their Apple products. Happy customers equal to loyal Apple customers,” Mr Teo added.
Contrary to popular belief, Apple Orchard Road will not signal the end of Apple premium resellers (APRs) like Nubox and Epicentre, and repair centres such as QCD Technology.
“They (APRs) will continue to adapt and survive – especially in suburban areas,” said Mr Teo. “Repair centres will be a great supplement to Apple for all sorts of warranty and repairs.”
In fact, Prof Shamdasani said that the Apple retail store will enhance the brand’s value and attractiveness and help to expand the market for Apple products and services in Singapore, which, in turn, will benefit the APRs and repair centres.
Apple Orchard Road will be run on 100 per cent clean energy using rooftop solar installations provided by Singapore-based solar energy provider Sunseap Group.
iPhone and MacBook user Chung Weifang is excited about the new Apple store here. The 33-year-old communications executive said: “There is nothing like buying a product from the brand’s flagship store, where the customer experience begins the moment one steps into the retail space.”
Rising vacancies and plunging rentals in shopping malls may be a headache for landlords, but it is not all bad news for retailers who have taken advantage of lower rentals to snag prime locations for their flagship stores.
More than 10 flagship stores were set up islandwide last year, noted property consultancy Cushman & Wakefield’s research director Christine Li. This is the highest number since the global financial crisis in 2009, she said.
The last wave of flagship stores were set up between 2007 and 2009, when Orchard Road was undergoing a makeover.
Last year, cosmetics label MAC and Sephora opened flagships at Ion Orchard, while Japanese fashion retailer Uniqlo unveiled a three-storey store in Orchard Central. Other new flagships include those of watch brand Rolex at Marina Square and German leather goods brand Braun Buffel at Marina Bay Sands.
Ms Li said: “In the lower rent environment, 2016 saw a ‘flight to quality’ as retail brands that are still optimistic on expansion took this opportunity to upgrade to larger prime retail spaces vacated by previous tenants.”
10 At least this number of flagship stores were set up islandwide last year. This is the highest number since the global financial crisis in 2009.
She said flagships are strategic, as they reinforce and enhance a brand’s presence and status.
Uniqlo’s founder Tadashi Yanai said the firm decided to open a flagship in Orchard Road as it sees Singapore as a gateway to not only the markets in South-east Asia but also in the Middle East and Africa.
“Despite the faltering retail climate in Singapore, Uniqlo’s belief in the potential of this region is what has driven (our) decision to launch the three-storey Global Flagship store here,” he said.
The islandwide vacancy rate for retail space was 7.5 per cent at the end of last year, up from 4.5 per cent at the end of 2013, Urban Redevelopment Authority (URA) data showed.
The climbing vacancy rate has, in turn, reduced rental rates. The median rental rate for retail space in the third quarter of last year was the lowest on record, falling to $9.82 per sq ft per month for the Orchard Road area – the first time it fell below $10, URA data showed.
Riding on the wave of soft rents, French sporting goods retailer Decathlon even secured a 15-year lease for a 35,000 sq ft outlet in Viva Business Park in Chai Chee, which opened in January last year.
Singapore retail rents slipped by 4.2 per cent in 2016 – an improvement on the 5.7 per cent decline of 2015, according to data from Edmund Tie & Company research.
And they should remain resilient in the year ahead.
The islandwide average monthly retail gross rent fell to about $29.25 per sq ft last year in what Edmund Tie describes as a “moderate decline”.
Stabilising rents in the Orchard Road-Scotts Road precinct helped pare back the slide. While rents in Orchard/Scotts Road eased by 2.2 per cent in the first half of 2016, rents remained unchanged at $37.20 per sq ft per month in the second half.
“The resilience in rents was attributed to limited supply in the prime shopping district, with only about 90,000 sq ft of retail net lettable area (NLA) expected to be completed over the next four years,” said Edmund Tie in a statement. “Moreover, there was strong demand for retail units in Orchard/Scotts Road, especially for those with a visible street frontage, as evidenced by the recent opening of several flagship stores and new-to-market brands.”
During the third quarter of 2016, retailers absorbed some 112,000 sqft of new space in the precinct, a reversal from the negative net absorption of 99,000 sqft in the second quarter.
“Hence, barring any unforeseen economic shocks, rents are anticipated to remain resilient in 2017.”
Rents in the suburban areas were also stabilising, remaining unchanged quarter-on-quarter at $30.60 per sqft per month in the fourth quarter, after falling by 3.5 per cent during the first three quarters.
Edmund Tie says rents are unlikely to decrease in 2017 as much as they did last year, with upcoming suburban malls reporting healthy pre-commitment rates.
“In the third quarter, a positive net absorption of 314,000 sqft was recorded in the suburban areas, the highest in almost two years.”
On the contrary, rents in the other city areas remained under pressure, falling by 1 per cent quarter-on-quarter to about $19.90 per sqft per month in the final three months. “This was the seventh consecutive quarter of decline and it took the total rental decline in the other city areas to 8.7 per cent in 2016.
In addition, negative net absorption extended to -376,000 sqft in the third quarter from 25,000 sqft in the second. “Amid the impending supply of approximately 430,000 sqft of retail NLA in 2017, rents are likely to ease further in the first half of 2017, given a lack of crowds during the weekends due to the limited residential catchment. Nevertheless, the fall is likely to be transitory as retail demand will be supported by residents or guests of the residential, serviced apartment and/or hotel component in upcoming mixed-use developments such as DUO, OUE Downtown and Marina One.”
2017 outlook
“Overall, the decline in islandwide average rent is expected to moderate further in 2017,” predicted Edmund Tie. “To overcome competition from eCommerce and manpower constraints, more retailers are beginning to embrace technology, including NTUC FairPrice and Kopitiam. NTUC FairPrice currently offers the click-and-collect option for online shoppers, and self- checkout counters that are equipped to accept cash – which reduces its reliance on cashiers. Likewise, Kopitiam at the upcoming Hillion Mall will introduce the iCashbox payment system, as well as self-orderings kiosks and a rewards programme to encourage diners to “Return Tray for Reward”.”
Dr Lee Nai Jia, Edmund Tie & Company’s Southeast Asia (SEA) head of research, noted: “Looking forward, it is possible that malls in the future will become fulfilment centres, where buyers go to the malls to collect their goods, or exhibition venues, where retailers attract buyers and deliver their purchases to their homes. Retail rents will not only reflect the location, but also the experiential effect of the mall.”
Usually, at this time of the year when Chinese New Year (CNY) is just around the corner, Ms Evelyn Ng, a shop assistant at a candy store, would be very busy at work. These days, however, business has been lukewarm — so much so that the shop will be moving out of 112 Katong in a few days.
“Look around — does it feel like it’s just days away from CNY?” said Ms Ng, pointing to the mall’s vacant atrium space, which, in better times, would be filled with vendors, especially during the festive period. “I am managing some S$200 worth of sales like I do on usual days,” she said.
The uncertainty plaguing the economy and the jobs market have dampened shoppers’ mood at malls in the run-up to CNY. Shops in several malls we visited over the past few days reported lower earnings compared with the same period in previous years, and atrium spaces were uncharacteristically empty.
A cashier at an international fashion store at 313@Somerset, who declined to be named, said that sales are “40 to 50 per cent” lower, compared with the CNY period in the past two years. “We now have two to three assistants per floor, compared with about six last year,” she said.
Mr Pushpendra Sharma, founder of SpacesGenie.com — an online retail spaces booking and listing platform — said demand for atrium space has been lacklustre amid the slump for brick and mortar retailers.
Singapore’s traditional retailers have been hit by a double whammy of an economic slowdown and the rise of e-commerce. But those who have adapted to the new landscape are faring better. For example, home decor retailer Crate and Barrel said its business this festive season had improved from the past year. “We are certainly responding to the trend of consumers going digital through our communication efforts,” said Mr Samuel Stephen Wright, brand manager at Crate and Barrel Singapore.
Some mall owners noted that the unusually short period this time — of about one month — between Christmas and CNY may have resulted in consumers cutting down their spending.
A City Square Mall spokesperson said the shopping centre has seen “healthy level of footfall and in-mall spending redemptions” during Christmas, which is expected to continue through CNY. Similarly, a Frasers Centrepoint Malls spokesperson said its promotions have been “well-received through Christmas, and we expect it to carry on into the CNY period”. “However, with such a short gap between the celebrations for the two festive periods, there is a higher tendency for shoppers to combine their spending.”
With the first two days of CNY falling on a weekend, mall managers expect a large number of shops and eateries to be open during the public holidays. Mall owners said there has been no let-up in promotional efforts to spur consumer spending. For example, at Northpoint in Yishun — which is owned by Frasers Centrepoint — there is an ongoing lucky draw promotion that runs until June 30. A lion dance performance and red packet giveaways, among other initiatives, are also on the cards.
Ms Ameerah Khairudin, 20, who works in the Orchard Road area, said there was “no point spending when it is so tough to find jobs”. She said: “We see so many people losing jobs. It worries me.” Retiree Gloria Leong, 68, noted that the malls are quieter. But with retailers desperate to drive up sales, she said: “I have not seen shops offering such hefty discounts during peak season before. Given the smaller crowd, we find it easier to shop around these days.” Rumi Hardasmalani
Singapore retail rents slipped 1.3 per cent in the last quarter of 2016, compared with the previous quarter.
According to data from JLL Singapore, included in a pan-industry market review, retail rents were under most pressure in the Marina quarter where most of the new space coming onto the market in the quarter was concentrated.
Despite positive net absorption of the opening of South Beach (60,000 s ft) and Tanjong Pagar Centre (100,000 sqft), rental corrections in the Marina submarket remained underpinned by the weak performance of retailers, with many of them seeking pre-termination of their leases, reports JLL.
The average vacancy rate of suburban malls, including Reit-owned and strata-titled shopping centres, has more than doubled from less than 1 per cent in 2013 to 2.4 per cent in the fourth quarter of last year. Year-on-year, average monthly gross rents for prime retail space in suburban malls fell by 7.1 per cent in the quarter.
Prime retail rents in Orchard Road have fallen 7.5 per cent over the same period.
The quarter saw marginal year-on-year retail sales decline in October, (excluding motor vehicles), driven by poorer sales in computers and telecommunications equipment and watches and jewellery, “ indicating the persistence of weak consumer sentiment”. And despite take-ups being dominated by the entry of new F&B operators, the F&B sales index also recorded a similar year-on-year decline.
“Total retail investment sales value for the fourth quarter rose sharply from a quarter ago, driven by the interest in retail assets in the suburban submarket, likely due to the resilient rental income they provided,” reported JLL. “Jurong Point, one of the biggest suburban shopping centres, was put up for sale at a price of more than SG$2 billion and received considerable interest.
“However, apart from the marginal compression of yields in the suburban submarket, overall yields remained relatively stable as the rate of capital value correction was in line with rental decline across the Orchard and Marina submarkets.”
Leasing activity slowed and the rental decline quickened in Q3 2016 due to continued headwinds from poor overall retail sales and online competition.
Based on rental records captured by the Urban Redevelopment Authority’s Real Estate Information System (URA REALIS) as at 18 October 2016, there were a total of 2,460 leasing deals in Q3 2016, down 12.5% quarter on quarter (QOQ) and 14.7% year on year (YOY). This was a sharp contrast to the 41.4% QOQ jump in leasing volume in Q2 2016.
According to Colliers International, the fall in leasing transactions in Q3 2016 reflected the weak sentiment in the retail sector which continued to face numerous challenges including Singapore’s weak economy, cost concerns, manpower shortages and intensifying competition from online retailers.
Moreover, although the latest available figures showed tourist arrivals stayed on the uptrend and rose 6.7% YOY in July, the retail sales index (excluding motor vehicles) contracted by 3.1% YOY and 6.5% YOY in July and August, respectively.
In light of the above, the decline in prime retail rents accelerated in Q3 2016, after slowing down in the second quarter.
In the Orchard Road sub-market, the average monthly gross rent for prime ground floor shopping mall space contracted by 0.9% QOQ from SGD40.21 per sq ft in Q2 2016 to SGD39.86 per sq ft in Q3 2016. This is faster than the 0.5% QOQ slide in Q2 2016.
Likewise, the rate of rental decline picked up pace in the Regional Centres.
The average monthly gross rent for prime ground floor shopping mall space reached SGD33.38 per sq ft, after falling by 0.8% QOQ in Q3 2016. In comparison, rents fell by 0.3% QOQ in Q2 2016.
Singapore’s retail sector is going through a rough patch. As the economy slows, shops are being boarded up and retail rents are falling.
And yet, amid this gloom, consumers continue to spend – though there is a shift in the pattern and quantum of their spending.
In June, the first month of the Great Singapore Sale, retailer sales were down 3 per cent compared with the same month last year. It is not just tourists who are staying away, but local consumers are also looking more closely at price tags.
The mood has not been helped by the fact that about 4,800 people were laid off in the second quarter, 48 per cent more than in the same period last year.
Landlords are feeling the pinch as well. Average monthly gross rents for prime first-storey speciality retail shops dipped 1.2 per cent in the three months to September from the previous quarter, said property consultancy Edmund Tie & Company recently.
Vacancies in the Orchard planning area rose again in the second quarter to 9.2 per cent, after reaching what was then a five-year high of 8.8 per cent in the first quarter.
ANZ economist Ng Weiwen pointed out that home prices have fallen for 12 consecutive quarters, while bank lending has shrunk for 11 straight months. This has translated into weaker spending.
However, the decline has been gentle across the board and there have been some bright spots. Those who find this surprising should look at the unemployment rate. While it rose from 1.9 per cent in March to 2.1 per cent in June, it remains quite low. Said OCBC economist Selena Ling: “When unemployment rate is anything below 3 per cent, it is effectively at full employment.”
It could be one reason why consumers continue spending on mid-range goods and services, such as travel and at cafes, even as they cut back on luxury items and seek better deals for necessities.
ANZ’s Mr Ng said: “For the different tiers of consumer spending, the high-end consumer segment will be more sensitive to changes in consumer income, so it’s not surprising.
“The mid-range segment will still hold up in the near term as wages are still holding up.”
In fact, more are paying their credit card bills on time. Only 32.25 per cent of card holders did not pay their bills in full for the second quarter, down from 33.91 per cent in the first quarter. Ms Ling said: “People have been turning slightly more cautious with spending.”
They may spend less on fashion. And malls could take a hit if their offerings are the same as the ones available on Taobao and the like, she added.
But cheaper options like house brands at supermarket chain FairPrice are seeing stronger demand.
This is what a slowing economy looks like – in Singapore.
With the relevance of the Great Singapore Sale (GSS) in doubt, going by falling retail sales, questions have been raised about what went wrong with the sale.
Many consumers have pointed out that the annual sale of 23 years is not that great, as the discounts offered here are not as steep compared with those in sales overseas.
They also lamented that the discounts are mostly for older merchandise. A possible reason for this is that Singapore has no seasons.
Associate Professor Prem Shamdasani, from the National University of Singapore Business School’s marketing department, said the summer sales in Tokyo and Hong Kong tend to be more successful than the GSS due to the seasonality of the products sold.”(This) encourages (their) retailers to offer deep discounts to clear inventory and make room for new arrivals, which are also attractively marked down to entice local shoppers and tourists,” he said.
Offering steep discounts is also not sustainable for businesses here, said Singapore Polytechnic senior retail lecturer Sarah Lim.
“(This) will eat into the retailer’s overall profit, and with rental and manpower costs all added in, the retailer may not be able to sustain the business,” she said.
Singapore Retailers Association (SRA) president R. Dhinakaran previously said holding sales to clear old stock is common worldwide.
The retail scene has been slow in recent months. Latest official statistics show that retail sales excluding motor vehicles in June and July each fell 3 per cent over the same months last year.
This is despite the attempts for this year’s GSS – which took place from June 3 to Aug 14 – to draw tourists and residents with an extended sale, more payment options and a more targeted focus on tourists from China. The poor showing, and similar sales declines in June last year and 2014, prompted the SRA, which organises the GSS, to suggest a need to discuss with the Singapore Tourism Board about continuing the event or revamping it.
Retailers and retail experts have pointed to the slowing economy here and overseas as a key factor for the slump this year, but there are other concerns as well.
One issue raised about this year’s GSS is its length and timing.
The event started in June – a week later than last year – and was extended to 10 weeks to cover the bulk of China’s summer holidays.
In the past 12 years, the annual sale stretched over eight weeks.
But a 10-week sale might have led to sale fatigue among Singaporeans inundated with “end-of-season sales” or “anniversary sales” year round, said retail experts.
Research suggests that local consumers with strong spending power are disciplined spenders and tend to spend more during the early weeks of the GSS, said Dr Guan Chong, head of marketing programme at SIM University’s School of Business. “Thereafter, their spending pattern should likely stay low for the rest of the GSS period,” she said.
GSS’ new sale period also clashes with big sales elsewhere such as Tokyo’s famous end-of-summer sales, which start around the third week of July, she noted.
Then, there is the perennial problem of retailers holding their own sales earlier to beat their rivals, dampening the effect of the GSS.
Department stores Robinsons, Metro and OG started their GSS sales in May this year, while baby supplies store Mothercare and hardware chain Home-Fix held pre-GSS sales. Robinsons said this was done in line with shoppers’ expectations for the GSS to start in May, as in previous years. Mothercare did so because its competitors were also holding their sales early.
SRA cannot stop retailers from holding their sales earlier, or dictate the duration of their sales.
There also appears to be a lack of awareness of the GSS and whether it was still going on, in part because of its length, said experts.
Given this, events could be held every weekend during the GSS period to highlight store promotions by themes – such as food or children – to create buzz and remind people the sale is ongoing, said Mr Steven Goh, executive director of the Orchard Road Business Association.
Another suggestion is not to focus on only discounts. Dr Lynda Wee, an adjunct associate professor at Nanyang Business School, said the GSS should add a lifestyle spin and combine shopping and dining promotions with leisure deals, such as those for spa sessions, movies and cooking lessons.
Dr Chong said merchants can ride on the digital marketing wave to connect with an international audience, such as using popular social media platforms.
Still, lower retail sales should not be blamed on the GSS alone, said Ms Lim, adding: “Orchard Road, Raffles City, Marina (Bay) and Suntec (City) lack strong positioning. Can our malls be differentiated so that tourists desire to visit each one of them because they are different?”
American brand Elizabeth Arden, one of the oldest names in the beauty industry, is embarking on an ambitious repositioning plan and its president is counting on her Singapore roots to steer the beauty behemoth ahead of the competition.
“Being a Singaporean, what you learn since young is to always stay ahead of the game,” said Ms JuE Wong, who took the helm at the more than century-old brand slightly more than a year ago, becoming the highest-ranked Singaporean in a multinational beauty company.
“When I was growing up, there was only one university. If you (didn’t) make it to the National University of Singapore (NUS), you basically (had) to think of somewhere else to go,” said the 49-year-old, who eventually opted to pursue her undergraduate studies in Australia after missing out on her first choice to read law at NUS.
“That’s why I think I’ve always been conditioned and trained to be an outside-the-box thinker,” she added.
This sense of fast-thinking adaptability is what Ms Wong wants to inject into Elizabeth Arden, as the iconic brand seeks to win over consumers from the younger generation amid the constant emergence of newer brands and a changing retail world in a digital age.
While the brand’s 106 years of heritage underscores “trust and credibility that can only be earned over time”, Ms Wong admitted that it can also, at times, work as an obstacle when it comes to attracting younger consumers, especially those between the ages of 28 and 40. Hence, the company is turning its target to even-younger millennials who have shown a greater willingness to give the brand a try.
“When we did our consumer insights, we found that people from the age group of 28 to 40 know who we are and know enough to often think ‘This is my mother’s brand’. On the other hand, those younger than 25 have not heard that much about us. They do not have any perceived baggage and so (are) willing to give us a chance.”
To appeal to this group of digital-savvy millennials, Elizabeth Arden stepped up its digital strategy with a social media campaign called “From the desk of #LizArden” and partnered beauty app YouCam Makeup. According to Ms Wong, both initiatives have been a success, especially the latter, which delivered a sizeable boost to its e-commerce sales.
Available in the US and China, the app is equipped with facial recognition technology that allows users to virtually try on various makeup products and provides direct links for shoppers to make purchases on Elizabeth Arden’s online platform.
“We met the developers in September, had a soft launch in October and by the time we rolled out officially in December, we already had 58 million downloads and 22.9 per cent of these reposted a selfie marked with our name. I had almost a million dollar in sales (within) 30 days,” Ms Wong told Channel NewsAsia.
In Singapore, the company launched a pop-up store, featuring a smart mirror and an interactive wall that tells the history of Elizabeth Arden, outside Robinsons at The Heeren to mark the roll-out of its latest product earlier this week.
“By making ourselves more cutting-edge and more engaging for the younger audiences, I think we make ourselves relevant,” said Ms Wong.
Even in a downbeat brick-and-mortar retail market, Ms Wong remains confident that the beauty giant can turn around the situation by identifying pockets of growth in areas such as the colour cosmetics and spa categories.
For instance, the company started introducing services from its Red Door Spa brand at selected retail counters in the US. Sales at these counters have since posted “double-digit growth”, according to Ms Wong. “We are offering a point of differentiation … and I think that’s how you cultivate a new generation to experience what the brand is all about.”
Nonetheless, the businesswoman acknowledged that the brand’s digital ventures are no walk in the park. Coupled with the fact that it would be the first time she is taking on a leadership position at a giant such as Elizabeth Arden, Ms Wong admitted that it has been “a bit of a leap” but she was not daunted.
Elizabeth Arden Pop-op Store at Orchard Road
Prior to becoming president of the Elizabeth Arden brand, the Singaporean was the chief executive of venture-backed cosmeceutical company StriVectin as well as Astral Health and Beauty, and held senior positions at then-emerging brands including Murad and N.V Perricone MD.
“Compared to the smaller brands, there’s enough resources at Elizabeth Arden and I was able to push a lot of my ideas. Of course, if I made a mistake, it would be amplified but does that make me less of a risk taker? No … and the Singaporean in me, ‘kiasu’ as we call it, means that I’m not going to lose,” she added with a chuckle.
“Even though I’ve been away longer than I lived in Singapore, but once a Singaporean, always a Singaporean.”
DARING TO GO: SWITCHING FROM COMMODITY TRADING TO SKINCARE
This huge appetite for risks is also observable from Ms Wong’s resume. After graduating from the Australian National University with a degree in political science, she decided to take a plunge into the trading world and later spent seven years on the trading floor at Cargill Commodities.
“I wanted something out of my comfort zone and it was very challenging,” Ms Wong recalled. “We had a daily scorecard of the books that were closed … it was like playing chess and at the end of every day, you either checkmate or you get checkmated.”
A “self-driven reason of wanting to know better ways of skincare” led Ms Wong into the beauty industry in the US during the 2000s, and for the Singaporean, there was no mountain that was too high to conquer.
“After leaving Murad to join private equity-owned Perricone, it was since that time (that) I never had to look for a job because every time I take a brand and turn it around, another private equity firm would come to me or the same private equity firm would offer me another brand,” said Ms Wong, who was nominated as the Top 50 women to watch by Wall Street Journal in 2004.
“It was very validating because I realised that at the end of the day, you can get so much recognition if you had a real scorecard. And in that regard, I think my days in commodity trading really prepared me for today.”
While her fast-talking persona and dare-to-go attitude has resulted in “some hindrances” at the start of her career, Ms Wong does not regret the career switches that she has made, and hailing from the little red dot on the world map definitely has not stopped her from climbing up the corporate ladder in the Big Apple.
Ms Wong said: “My mother would tell you this story … when I was 12, I told her that one day I was going to work in the Big Apple and she replied to me saying, ‘Don’t be silly’. I don’t remember this … but if I did, a part of me perhaps realised that Singapore may be a small country but it had a very good reputation.
“Literally everybody has heard of us and we never really had to explain where we come from. And because I came from a country that’s so well respected, it gave me the courage to dare to dream.”
ALODD by Aldo Lipari is a new Singapore-based label to step out into the retail scene in Singapore.
The footwear brand is founded by Aldo Lipari, who brings his wealth of experience as the former CEO of Bally Southeast Asia / Oceania, drawing on his know-how on the market and what consumers want, in setting up his own venture.
A resident of Singapore for the past six years, Lipari first relocated to the city-state to run Bally’s operations in the region, serving as the Swiss luxury brand’s CEO of Southeast Asia and Oceania from 2009 to 2014
I’m very much at home in the Asia Pacific / Southeast Asia region and have a strong understanding of what the customer here wants, what the climate and lifestyle require. But I’m also Italian, with an immense appreciation for quality and craftsmanship,” explains Aldo.
The flagship store for ALODD by Aldo Lipari opens in the newly-opened annex of The Centrepoint on Orchard Road, and sits opposite the popular Ministry of Food and soon-to-be opened, Din Tai Fung.
Our beautifully designed shoes are handmade in Italy to the absolute highest standards,”
“By eliminating many of the unnecessary overheads that major brands are subject to, we’re able to deliver a product that presents far greater value than what you’d find on the shelves at most ‘luxury’ boutiques.”
ALODD’s footwear is exquisitely crafted by Italian artisans, utilising time honoured, traditional shoemaking techniques.
The ALODD range is priced from $397 to $496, and staples for the working man include classic loafers, lace-ups and slip-ons, to a Derby, Oxford and Double Monkstrap.
For the weekend, driver moccasins, suede loafer and the woven loafer make excellent choices.
Lastly the label’s unique Comfort Line which is a hybrid of sneaker meets Italian footwear, features the California construction.
Although its name suggests American origins, the ‘California’ technique of shoe construction actually originated in Italy.
As is the case with all of ALODD’s footwear, Comfort Line shoemaking is carried out entirely in Italy, by skilled Italian craftsmen.
ALODD by Aldo Lipari The Centrepoint
#02-50 The Centrepoint, 176 Orchard Road
Singapore 238843
ALODD by Aldo Lipari Takashimaya
391 Orchard Road, Takashimaya Shopping Center Level 3
Singapore 2238873
French multi-brand beauty retail giant Sephora opened its new local flagship store at Ion Orchard to much fanfare last Friday. The store sprawls across 10,000sqf on basement 2, and features a refreshed store concept from its previous premises on level 1, incorporating a boutique-within-a-boutique concept and better lighting.
The queue to be among the first paying customers to enter the store at noon on July 22 started forming at 9.30pm the night before, and there were 1,000 people waiting outside by the time the store was opened. Sephora vouchers of S$100, S$50 and S$10 were handed out to the first 500 people in the queue, while limited-edition gift packs were given to the next 500.
Among those in the pre-opening queue was 21-year-old sales associate Catherine Low, who had joined the snaking line at 6.15am on opening day. “I decided to join the queue to be among the first in line because I have been lusting after Kat Von D products for a long time and now I can finally purchase it in stores here,” she said. “When I got in I made a beeline for the Kat Von D Everlasting Liquid Lipstick in Lolita. This shade is really popular and I was afraid it would be sold out”.
The flagship store boasts a global-first for Sephora — a Kat Von D store-in-store that carries the full range of the cosmetics brand that was founded by the celebrity Los Angeles-based tattoo artist, who shot to fame on reality television show LA Ink. Close to 4,000 products from the Kat Von D range were sold on launch day, with the sales of the brand’s popular Everlasting Liquid Lipsticks accounting for half of the sales.
Kat Von D currently takes pole position at Sephora in Malaysia, Thailand and Singapore since it was launched on Sephora’s local e-commerce site on July 7 and in the retail stores in Malaysia and Thailand on July 16. It has racked up over six figures in sales in these three countries to date.
The experiential element
What Sephora nailed was creating a retail environment shoppers are excited to be in. “Sephora Ion Orchard has always been one of the top 10 (outlets), not just in Asia, but in the world, so it was the natural choice to launch the first Kat Von D Shop-in-Shop together with Sephora Ion Orchard’s new home to provide a more vibrant and electrifying retail experience for her many fans,” said Mathieu Sidokpohou, Sephora’s managing director of South-east Asia.
Other highlights at the store include professional cosmetics brand Make Up For Ever’s “sushi bar” concept counter, which features a conveyor belt where shoppers can pick up bento boxes of makeup items, exclusive-to-store brands Cover FX and Zoeva and a Made-in-Sephora gondola featuring house-brand products.
These in-store highlights, together with the prime positioning of the store, which is a stone’s throw from Orchard MRT Station, is set to further strengthen Sephora Ion Orchard’s position as one of the top-grossing beauty retail spots in Singapore and the region. The anticipated footfall at the flagship Sephora store also presents beauty retailers with an opportunity to create a buzz around big campaigns and launches before products are rolled out to the rest of the island. The store is the first in Asia to carry all 100 lipstick and 50 lip pencil shades of cult US cosmetics brand Urban Decay’s highly hyped 10th anniversary collection.
The beauty retailers spoke to welcome the added experiential retail elements at the store. “The new design layout of two main aisles instead of just one allows more visibility for brands from different categories and allows customers more interaction with the brands, which translates to a refreshing customer experience,” said Chen Jingwen, Nudestix’s brand manager for South-east Asia, which is one of the beauty brands that are exclusively available at Sephora outlets here.
Avid Sephora customer and 98.7FM DJ Sonia Chew agreed: “I love the new store for the vast amount of brands they have and it’s also got a much edgier and fresher feel to it with plenty of corners to explore in the store — and to discover more goodies to buy! Sephora attracts the true-blue beauty junkies, and I always feel like I have a secret bond with the people who shop there.”
Naturally, the management of Ion Orchard is pleased with the response as Sephora’s relocation is part of the mall’s strategy to keep the retail scene healthy. “The relocation of Sephora is part of our ongoing efforts to refresh our tenant mix with new and established brands that have their flagship presence at Ion Orchard, and to enhance the existing beauty cluster,” said Chris Chong, chief executive of Orchard Turn Developments, adding that this move had been in the works since last year. “Ion Orchard houses many international brands whose stores at Ion Orchard rank among their top 10 globally for size and sales. Sephora counts as one of these. We have been working with Sephora to delight our shoppers with high-profile celebrity appearances by Sandara Park, David Gandy and Kat Von D, and will continue to partner them in such activities and mall campaigns.”
A post on Chinese social media platform WeChat touts Orchard Road as a prime spot for a selfie, with its backdrop of high street brands and clean surroundings.
Another post raves about the value of the dishes at seafood restaurant chain Fish & Co, where appetisers cost between $3.90 and $11.90.
The Orchard Road Business Association (Orba) set up the WeChat account two months ago to promote the shopping street directly to consumers in China.
“In China, without a WeChat account, it’s impossible to communicate with the consumers,” said Mr Steven Goh, Orba’s executive director.
Like many businesses in Singapore, Orba is looking to the Chinese to provide a boost to the flagging retail and tourism sectors.
The Orchard Road Business Association recently hired a marketing agency in China to come up with twice-weekly posts on its WeChat platform that use the lingo of the mainland Chinese to introduce the brands in Orchard Road. PHOTO: ORCHARD ROAD BUSINESS ASSOCIATION
Competition from online shops and weak consumer sentiments have translated into lower retail sales. Tourism growth is expected to slow to a crawl this year, as tourists tighten their belts ahead of a weakening global economy.
The Chinese, however, offer hope.
Last year, Chinese visitor arrivals grew 22 per cent year-on- year to 2.1 million. Although their expenditure of $2.54 billion was a 4 per cent dip from the 2014 figure, they were still the top spenders among visitors here.
In recent years, Orba has sent teams to different cities in China regularly to promote the street.
Recently, it hired a marketing agency in China to come up with twice-weekly posts on its WeChat platform that introduce – in the lingo of the mainland Chinese – the brands in Orchard Road.
Its efforts complement those of the Singapore Retailers Association (SRA), which roped in Chinese payments firm UnionPay International as a partner of its Great Singapore Sale this year.
SRA extended the sale to 10 weeks and started it a week later than usual to coincide with most of China’s summer holidays.
Other retailers are also taking the initiative to cater to the Chinese.
Retail shop Taula Jewellery in Clarke Quay widened its range in March to include fashion jewellery and items with prices starting from $29, instead of $49 previously. Its Chinese customers prefer fashion jewellery to precious metal jewellery such as silver and gold, and like good deals, owner Kanika Mittal, 35, noted.
Department store Takashimaya is “displaying more prominently” products that are more highly discounted and appealing to Chinese tourists, who make up 30 per cent of its foreign customers, said a spokesman.
SRA executive director Anthony Gan said the Chinese tend to look for goods and services tax refund service, shops that accept UnionPay, Mandarin-speaking staff and special offers.
The spending patterns of Chinese tourists have evolved, said UnionPay International South-east Asia general manager Yang Wenhui. He said it was “seeing spending on hotels, supermarkets, dining, airlines and retail grow at a much faster rate than luxury goods in general”.
Tourism consultant Edward Chew said Chinese tourists no longer “purchase everything they come across”, with many international brands now available in China.
The former Singapore Tourism Board regional director for Greater China said: “We need to distil what Singapore is good for and strong in and what’s unique about our retail scene, and actively promote them to the Chinese traveller in Singapore.”
