Watsons Singapore: Reshaping Retail in the New Normal

Staying focused on its O+O strategy, continually seeking to provide a seamless customer experience by removing pain points and elevating shopping experiences.

Watsons Singapore has been recognised as the Health & Beauty Retailer of the Year – Singapore for the 3^rd consecutive year and also picked up Omnichannel Strategy of the Year - Singapore at the Retail Asia Awards 2023. 

These awards recognition comes after a record-breaking year for Watsons in 2022, with the highest sales ever achieved in the company's history, a double-digit sales growth over 2021. The company also exceeded its EBIT growth budget, with a strong productivity performance.

Watsons Singapore’s continued success has been attributed to its multi-prong approach; an O+O strategy backed by strong brand equity and a robust Watsons Membership loyalty programme, coupled with its new sustainability focus and continued development of its people.

The O+O transformation strategy was particularly relevant during the pandemic, with Watsons' online platform gaining significant brand awareness and equity, ranking 2^nd only behind a leading marketplace player. The upgraded mobile app launched in July 2022 offered ease and convenience when shopping online, and cart abandonment declined by about 40%. Watsons further enhanced its online shopping experience by prioritising speed and convenience, as customers can now shop in the comfort of their homes and have their items delivered directly to their doorstep within 3 hours, with the launch of their new Home Delivery Express service.

Also, with a strategy requires a strong team of people with the right mindset, Watsons has developed an O+O team that is trained to promote eCommerce to walk-in customers and bring customers back to stores for offline transactions. Stores now operate as mini e-distribution centres, with store staff not only serving walk-in customers but fulfilling eCommerce purchases either coming from their online platform or 3^rd party partner platforms. Physical stores have been enhanced with QR codes and URLs that connect customers to more than just regular physical store spaces.

The O+O model for a seamless customer experience has made Watsons the first health & beauty retailer to partner with Amazon to offer a wide selection of products to Prime Members in January 2022. Picked, packed and ready to be shipped from centrally located stores, online sales value exceeded one of the leading quick commerce players within the first six months of operations, improving both the stores’ productivity and the ability to cater to customers' wants for express delivery within 2-hours.

Watsons also focuses on personalisation, with more than 1 million members that contribute to about 2/3 of the entire Watsons business. More than 60% of them shop at least once every 3 months with Watsons. Owning the customer data allows the company to curate and personalise its offerings to members, improving members' loyalty and better satisfaction whilst improving efficiency in communications, promotion planning, and stock management.

Since the pandemic, consumers are less comfortable trying out product testers and there are more instances of unsuitable or incorrect purchase of makeup products. With the easing of pandemic restrictions, makeup purchases are on the rebound and Watsons recognises the need to address the pain points of buying incorrect makeup. With that, they were the first in Asia to pioneer the launch of Retailssure, a makeup exchange assurance programme for consumers to enjoy a worry-free shopping experience. In collaboration with a pan-Asian insurer, FWD Insurance, this service allows Watsons’ members to exchange new or opened makeup products that are deemed unsuitable within seven days from the date of purchase for in-store purchases or from the date of delivery for online orders. Offering greater peace of mind and a transformative retail experience for shoppers.

Sustainability is a key component of Watsons' brand value and promise of "Look Good, Do Good, Feel Great". Watsons offers the best quality that customers can trust, at the best price, and guaranteed good for them and the planet as 37% of Watsons Brand are sustainable choices. The company expanded its Bring Your Own Bag initiative from once a week to every day since September 2022, with more than 80% of transactions opting out of plastics. Watsons also launched a plastic recycling initiative as well as refill stations expanded to three locations.

Big data is critical and applied in various aspects and for decision-making at Watsons. The company continues to run its business scientifically by analysing all sources of data for better consumer satisfaction, promotion mechanics, and store expansion, as well as for improving the productivity of space to support offline and online demand. Data is also made convenient and always available for staff access through dashboard capabilities, allowing decisions to be made quicker and more effectively.

From a traditional local pharmacy to an international health and beauty retailer, Watsons has always put customers at the centre of its strategy and maintained business agility. The O+O strategy drives the company to bring a healthier and better life to its customers and continue to work at fulfilling its promise - to bring a smile to customers’ faces.