Latest / The Retail Podcast / Five Things Friday APAC: Shanghai Fashion Week, India’s Beauty Boom & Holiday Optimism in Australia

Transcript

Five Things Friday APAC: Shanghai Fashion Week, India’s Beauty Boom & Holiday Optimism in Australia · The Retail Podcast

• 0:00
  Hello everyone, and welcome to Five Things Friday AIPAC
• 0:03
  Edition. Now this week we are coming to
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  you on a Monday, so don't panic if you've been waiting all
• 0:08
  weekend for us, we are here. It's Monday for Five Things
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  Friday. Hello.
• 0:23
  Hello it. Should be.
• 0:25
  It was Bonjour. Bonjour.
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  Come on, Delibo. Jejama Bell Ali Monster Monster.
• 0:33
  Unkilla Dutomat. Civil Play.
• 0:38
  See, I was in, I didn't. I tied in French.
• 0:40
  See, you know I tied in French and being in a grocer.
• 0:43
  Oh, it's fantastic. It was brilliant.
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  I felt I was conversing with a a, a genuine French person.
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  I think my accent would be considered quite rugged in
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  Paris. I bring.
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  You your home now, right? Yes, I am.
• 0:58
  Hi, I'm back in Sydney. You know, how does your
• 1:00
  scheduling issues? Yeah.
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  So yeah, every week. So listen, why don't we jump
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  straight in and why don't we? Absolutely, if we're we're,
• 1:06
  we're joking about Rs and NRF, Why don't you give us some
• 1:09
  thoughts? How did it go?
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  Well, it was, it was really cool actually.
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  It was the first show and I suppose for me it's the first
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  European show I've been to. And I gotta say that as the
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  retail community around the world is pretty unique and quite
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  similar and quite global in its stinking.
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  But what was really cool was it, you know, this was a big show,
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  bigger than definitely bigger than AIPAC.
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  It was 480 exhibitors, like 25,000 square metres of Expo,
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  which is pretty big. Yeah.
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  You know, this, there was 200 international speakers, You
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  know, headline speaker was the CFI, sorry, the CEO, the global
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  CEO of Sephora. Yeah, which is pretty good.
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  But they had Sam's Club out of the US, you know, a whole bunch
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  of really cool speech. So yeah, for a first, she showed
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  the content was amazing and and great speakers.
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  I think you saw a session from the metro and the AI, It was
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  probably one of the best AI sessions you've ever seen, you
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  would say. Yeah.
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  To be honest, that was brilliant.
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  Metro fashion was phenomenal. Yeah, and so it's a really cool
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  content. And then and then things like
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  exhibit A big ideas. Obviously we have them in Asia
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  Pacific and in New York, but they had 60 sessions and they
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  were all amazing. So you know, for a first time
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  show is like pretty cool. So I came away really excited
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  because, you know, coming to a show out of market, out of my
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  territory and, and experiencing it, you know, it was, it was
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  fantastic and saw a few familiar faces floating around.
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  But it you can really see for Asia Pacific, there's a
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  separation. You'll see a lot of people from
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  Asia Pacific going to the US, but far less going from Asia
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  Pacific to Europe. Got you.
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  And I think probably what we'll probably find in our this
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  current economic times that Asia and Europe might find themselves
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  becoming a bit more closely aligned, so to speak.
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  Well, yeah, I think when, yeah, I can definitely see the
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  groundwork for that. Yeah.
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  And we saw Emmanuel Macron in Asia recently and there's been
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  other European leaders down here.
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  So I think that there's going to, I think you know, if you're,
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  if you're thinking about retail and heartland traditional retail
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  luxury brands, those with some classic retail brands, you know,
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  you might consider going heading up to up to Paris in, in
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  September next year because I think, you know, it was, it was
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  a really cool experience. I had a great time and I'll be
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  definitely going back next year. I think.
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  OK, cool. So yeah, so, yeah.
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  So it was a stand out show for me.
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  So and I had a good, we had a really good time, yeah.
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  OK, I, I had a mixed time. So I'm going to be honest, I
• 3:32
  love you. I love the impact show.
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  It was, it was a bit of everything, but there were,
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  there were some definite glimpses of gold and I and I
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  really did enjoy the thing. I thought the Expo space was
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  phenomenal. I did think they had a good
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  expertise. The innovation hubs were really
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  great and some of the keynotes were phenomenal.
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  So I'm going to go straight in with my 3:00 and then we can
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  finish actually 2-3. It's the same one, but
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  ultimately there's three markets within the region and there's
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  like one consumer reset and a lot of decisions on the table
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  for for the industry as a whole. And what I'm going to try and do
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  is connect Shanghai faction week SS 26I's beauty and the luxury
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  surge that we've been talking about, which basically is 3 PL
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  build out into India, what analysts are calling them the
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  recession glam, which more recession because it's all doom
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  and gloom in the UK when we're doing this in the UK.
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  And then you can think of like the next 3 minutes as an
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  operational briefing on what to track, what to place bets on.
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  Obviously, it's not financial advice.
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  So please do not make any financial decisions based on
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  what what we're saying and which.
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  Just call my broker. The Shanghai SP 6 is a buying
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  market with momentum. It's running from the 9th and
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  6th to so from the 9th to the 16th of October 100 plus show.
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  It's a trade show like Omni time show mode returning
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  international debuts on the calendar by a participate
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  participation and it's reportedly back to pre pandemic.
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  So you'll see Adidas love Adidas staging headline show the
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  Shanghai's creating centre airing running its generation
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  awards. Obviously caring is the luxury
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  group and Harrods back with its forum and it and it's not just
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  sort of look looking at the culture, it's looking at an
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  efficient sales engine that sort of has a tighter collections,
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  hero items and a schedule that's I think probably on on to be one
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  of the best globally for for global buyers basically.
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  And vogue business has a whole bunch of take takes it further.
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  So I'll put vogue businesses link in the show notes and you
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  can go off to do with that. And So what you what do you do
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  with that? In my mind, you treat the
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  Shanghai event as an building week, not just a PR week.
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  So when you're looking into China specifically for growth,
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  you're looking at the capsules that are being released by these
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  designers to get an idea of what the demand signals are.
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  And that should sort of look at sell through, help you look at
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  sell through return rates and reorder velocity because you're
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  now getting a sense of what is coming into fashion basically.
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  So, so that's that's the thing on Shanghai, actually, I'm not
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  sharing it, but let's see. All right, there we go.
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  Moving on to and I will beautifully transition this one.
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  So the next one, India, the next luxury beauty growth engine,
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  Globie beauty groups are doubling down on India.
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  The luxury beauty segment is about $800 million today.
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  It's projected to reach 4 billion by in the next 10 years.
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  And that's a low base luxuries, roughly 4% of India's 21 billion
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  dollars beauty and personal care market far Southeast Asia.
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  Oh, far below is A and north. So the runaway remains long and
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  you'll look to see more brands, more intensity coming into the
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  region and expanding distribution through likes of
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  Nika and modern Trade testing more premium cities and going
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  into more premium regions within the the country.
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  And Reuters has a whole piece on this.
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  So is that the Reuters? Yes, that is the Reuters
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  fantastic. And and So what how to think
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  about that? Why is that important?
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  There's a three tier price ladder with real product
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  distance between the tiers. And so when you anchor claims in
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  efficacy and you show that the reviews are not just ads and
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  this we're talking about sort of social marketing.
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  And if you run channels, you plan your inventory and you look
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  at your fixtures around festivals and wedding cycles
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  that actually are massive moments for beauty, it becomes
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  a, you know, the growth engine of the future.
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  So I think for a lot of retailers, it's the tracking.
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  How do we and how are they going into the in the into the region,
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  but basically planting the seeds of tomorrow because it's
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  exponential growth for. The So we are we seeing all the
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  main international players, Yeah.
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  Or we are we seeing? Yeah.
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  Absolutely. So I think in the in the article
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  it talks about which what I didn't want to do is just
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  rewrite what is in the article, but basically it says, you know,
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  from Japan to France, L'Oreal, basically everyone's moving in
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  there. And that's where I got the
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  numbers from in terms of the big growth, but pretty much all of
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  the major beauty players are moving into the region or as I
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  was saying, laying the seeds or the foundation for future
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  growth. And I think that's the, you
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  know, sometimes people get the balance wrong of how, how
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  quickly do we move into a market.
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  And, and for me and for us, we always talk about building a
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  community. So how do you build community
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  via, you know, at, at the same time as building a business?
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  And I think that's only achieved through going into a market,
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  slowly getting your socials running and getting the
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  community engaged with the brand and then expanding because then
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  you're creating FOMO. And yeah, and we're saying,
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  we're saying that in Southeast Asia with people like shopping
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  and Lazada, you know where where some of these guys particularly
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  beauty in other categories which are similar coming in via online
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  marketplace strategy where they're sort of renting other
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  people's sort of warehousing and last mile delivery services and
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  free PL services. Yeah.
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  And and entering a market gently getting their product on the
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  ground, getting their product into consumer hands and then
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  coming in and delivering an Omni channel experience through
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  partners. But that's that's we're seeing
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  that happen in the region now really in Southeast Asia, Yeah.
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  I think just sort of stick sticking with the three PLS and
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  laying the track for for growth. There was a CB report this year
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  that cited India is the most preferred expansion market for
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  the region and three PLS with nearly 70% of planning to expand
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  in the next two years. So that's 40 to 50% logistics
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  real estate leasing between 20 to 124 and over 30% in the first
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  half of 2025. Most plan to stay asset light
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  via multi tenanted facilities and ramping up the warehouse
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  management systems, automation and cold chain which basically
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  means faster scale up, build better last mile engagement and
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  improve service levels for categories like cosmetics and so
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  I'm. Sorry, I think quick commerce is
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  quick commerce must be driving a lot of that though, because,
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  because there must be, you know, in those high densities, tier
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  one cities, Mumbai, Delhi, Hyderabad, you know, I reckon
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  there's going to be some pretty crazy delivery mechanisms.
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  Yeah, and and multi, multi just multi location and brand
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  location sharing because you know, not every, you know with
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  the diversity of what's going on in quick commerce India, I don't
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  think you could actually do have that many black sites in terms
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  of distribution centres to actually make it work without
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  having to share and and and and on sell your capacity if you if
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  you've got some. Yeah, I've got one more, but
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  because of time, let's go. So Myron's recession glam.
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  I'll put this in the beauty note so we may cover it off next
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  time. And let's close with your final
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  one. I think, yeah, so one's mine's
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  quite exciting. I want to bring it back to
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  Australia because I haven't talked about Australia for a
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  long time because I feel very conscious being Australia that
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  we always talk about ourselves. So now I am and I'm going to
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  celebrate that. So to yesterday, I think, or
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  today, a Deloitte report came out from the team at Deloitte.
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  There's a great retail team at Deloitte.
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  You haven't come across them in Australia.
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  And the thing that came back from these guys was they've just
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  done their holiday retail report for 2025 S holiday meeting from
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  Black Friday through to Boxing Day.
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  And the thing they found, which we know is counter to Europe and
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  to the US is that optimism is really starting to return to
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  Australia. Now obviously we're the lucky
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  country. So we have, we are optimistic
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  bunch. We are glass half full bunch.
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  But Australians plan, according to Deloitte, Australians are
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  playing, it's been 14 to 15 more percent this season than last
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  season, so about $11140 per person.
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  And most retailers in Australia expect sales growth from last
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  season compared with only 51% in 2024.
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  So there's there's optimism on both sides of the both sides of
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  the fence that consumers are feeling more positive and
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  retailers are feeling more positive.
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  And what's really interesting is, is that retailers expect to
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  generate half their holiday revenue from we have a thing
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  called click Frenzy, which is a retail festival like Friday and
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  Cyber Monday in in Australia. But then Christmas and Boxing
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  Day are expected to deliver the other half with the most with
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  most sales on those two days alone, which is pretty cool.
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  And where did where is this growth coming from?
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  Well, it's coming from 18 to 24 year old saying they're going to
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  spend more. And it's coming from blue collar
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  workers who are back employed and, and leading the charge at
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  the checkout. So that's pretty cool.
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  You know, the one last thing of note that's really important is
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  that more than 1/3 of consumers in Australia or Australian
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  consumers, they said they're going to switch brand for a
• 13:02
  better deal, IE looking for value rising from, you know,
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  it's, it's 42 of those under 35. So there's some real green
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  shoots on. It's not saying that the the
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  market's going to turn on its head and have a huge trading
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  period, but there's a little bit of posit little bit of
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  positivity out there. And I think in the content, in
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  the context of the global socio economic uncertainty with war
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  and with and and trade and all that type of stuff, to have
• 13:27
  these queen shoots in Australia is quite was quite a positive
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  thing. Because I think that, you know,
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  it's not so the case in other marketer in the world.
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  And you were saying it'd be a little bit before with with the
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  UK. It's not so bad at the moment,
• 13:39
  yes, which is so long. I think, I think it's nice, it's
• 13:43
  nice to have, it's nice to go into a season with some positive
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  narrative around it. So thank you for that Reef.
• 13:49
  We're going to take a break for two weeks.
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  Oh, actually, forget that. No, no, not net.
• 13:54
  We'll take, we'll take quick off.
• 13:56
  Yeah, but we'll be back the following week.
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  But we'll do once again, we'll do the Friday on Monday because
• 14:01
  like I get back on leave on the Thursday.
• 14:03
  So we'll do it on the table. We'll do it every recording on
• 14:05
  the Friday. But you might actually people
• 14:07
  might only see someone. I said don't sit at your
• 14:09
  computer all weekend waiting, OK?
• 14:12
  We promise it's coming, but don't wait for us.
• 14:13
  I know you do. I know lots of you.
• 14:15
  Just sit there and wait for it to come in on a Friday.
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  It may not happen, OK? It depends on Alex's editing
• 14:20
  skills. That's fantastic Reef, my
• 14:24
  friend, have a wonderful couple of Yeah a week, whatever and
• 14:27
  we'll. Speak.
• 14:28
  Take care mate. Bye.
• 14:29
  See ya.