Reasons to Read

Hosted by CEW, the Connected Consumer Conference brings together global industry executives to discuss trends and drivers in the beauty sector. We detail our key insights from this year’s conference, which focused on how the retail experience is being reshaped by technology.

We cover the following themes:

  • Changing consumption in China and findings from Singles’ Day 2019
  • The emergence and importance of “harmonized retail”
  • The omnichannel, customer-centric experience
  • The growing influence of social media in commerce

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Reasons to Read

This year’s Singles’ Day was another record-breaker with sales of $38.3 billion – up 26% from last year and more than five times Amazon’s last Prime Day. US retailers were the second-largest sellers into China by GMV. Each year, Alibaba tweaks its approach based on prior years’ learnings. This report looks at how Alibaba delivers these impressive year-on-year growth rates, such as:

  • New features on Tmall that let brands tailor their shops
  • Effectively leveraging social media
  • Marrying offline with online events

Click here to read more Coresight coverage of Singles’ Day for 2019 and prior years.

 

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Reasons to Read

Following Singles’ Day on November 11, 2019, the Coresight Research team attended Alibaba’s Observing China Forum in Beijing on November 14.

We highlight key themes from the event, focused around how digitalization is changing China’s commerce sector:

  • The shift towards a consumer-centric mindset
  • A step-by-step approach to implementing technologies throughout the supply chain
  • Continuous innovation in response to consumer demand

The forum also considered the factors driving consumption on Singles’ Day and the future outlook of the annual shopping holiday.

Click here to read more Coresight coverage of Singles’ Day for 2019 and prior years.

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Executive Summary

Chinese e-commerce services company Alibaba Group has filed for a second listing in Hong Kong.

  • Following the Double 11 Global Shopping Festival, Alibaba made headlines again in the same week with its secondary listing in Hong Kong, to raise $13.4 billion.
  • Amid turmoil in Hong Kong, Alibaba’s listing was a vote of confidence in the region as an international finance center and fundraising opportunity.
  • The company’s listing will fund its business expansion plans and investment in technology. The listing is possibly a move to avoid sanctions from US regulators, and it taps into a substantial new capital pool in Asia, building an around-the-clock trading market for global investors.

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Reasons to Read

This report is part of a biweekly series in which we discuss developments in China under the banner of “New Retail.” We offer insights into recent news, with a focus on digitalization and strategic collaborations.

This week, highlights include Alipay’s launch of an international version of its digital payment platform for visitors to China, the introduction of mini programs within the Meituan master app and Kuaishou’s unveiling of a new short-video app.

The appendix details the last 12 months of New Retail developments in China.

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Reasons to Read

With over 1 million new products launched on Tmall on Singles’ Day 2019, we review the different ways in which brands and retailers are implementing a “new product” strategy:

  • Launching crossover limited-edition products
  • Offering Tmall-exclusive customized gift boxes
  • Promoting new arrivals
  • Designing products with the Tmall Innovation Center

We also discuss the importance of new products to overall campaign success.

Click here to read more Coresight coverage of Singles’ Day for 2019 and prior years.

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Reasons to Read

Google Cloud announced via a blog post the acquisition of CloudSimple, a leading provider of secure, high performance, dedicated environments to run VMware workloads in the cloud. 

  • VMware is a software company majority owned by Dell which provides cloud computing and virtualization software and services. 
  • Many enterprises use VMware to run workloads such as ERP and CRM, as well as databases, and need a simple way to migrate those workloads to the cloud. 
  • The acquisition lets Google to accelerate its offering of a fully integrated VMware migration solution. 

The apps can then work the same as on-premise, but with all the benefits of the cloud, including performance, elasticity and integration with key cloud services and technologies. 

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Reasons to Read

HP’s board rejected Xerox acquisition bid, saying the offer undervalues the company and is not in the interests of the shareholders.

  • The company also expressed concerns about Xerox’s declining fortunes and the debt that would be needed to finance the acquisition.
  • HP is in the midst of a restructuring plan to simplify its operating model and become more digitally enabled.
  • HP hopes the plan will shave $1 billion in annual cost.

Management cited its confidence in its strategy and ability to execute to drive sustainable long-term value as part of the reason for rejecting the offer, but did say it remained open to exploring whether there is value for HP shareholders through a combination with Xerox.

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Executive Summary

On November 18, 2019, The Estée Lauder Companies announced it will acquire Have & Be Co. Ltd., the parent company of Dr. Jart+ and men’s grooming brand Do The Right Thing.

  • Estée Lauder announced it has signed an agreement to acquire the shares that it does not already own in Have & Be, a Seoul-based global skin care company behind Dr. Jart+ and men’s grooming brand Do The Right Thing.
  • The company initially invested in Have & Be in 2015, and since then Dr. Jart+ has grown significantly and is expected to hit $500 million in net sales by the end of calendar year 2019.
  • Dr. Jart+ is expected to help further strengthen The Estée Lauder Companies’ leadership position in skincare and will expand the company’s consumer reach in Asia Pacific, North America, the UK and in travel retail.

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QUESTION OF THE WEEK: How Does E-Commerce Penetration in Furniture and Homeware Compare with Other Categories?

Although e-commerce continues to gain share of US furniture and homeware sales, the market lags behind some other nonfood categories in terms of its e-commerce penetration rate. According to Statista estimates, e-commerce will account for 17% of US furniture and homeware sales in 2019.

Reasons to Read

We discuss the value of artificial intelligence (AI) to beauty retailers and its use cases, applying Coresight Research’s proprietary CORE framework for AI in retail. We also highlight a number of key insights from China, based on data from Coresight Research’s Beauty Consumer Survey, which was conducted in October 2019.

This report assesses the shopping preferences of Chinese beauty consumers and how brands could use AI throughout their supply chains to address market demand in the following key areas:

  • Communication, using AI-driven personalization, social media and shopping festivals
  • Price optimization and product promotion on e-commerce platforms
  • Inventory rationalization to streamline the fulfillment process
  • Experiential retail and the opportunities present in the beauty sector
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Reasons to Read

Coresight Research’s monthly reports keep you up to date on US and UK retail sales, US retail traffic and in-store metrics, selected US retailers’ same-store sales and key global consumer indicators. Click here to view our full collection of Monthly Reports.

Highlights from our October US Retail Sales Report:

US retail sales grew again in October – but with mixed results 

  • Sales growth accelerated in food and beverage stores, general merchandise stores and motor vehicle and parts dealers. 
  • But several sectors saw sequentially slower growth in October, with department stores (a sub-set of general-merchandise stores) hit hardest. 
  • Clothing and accessory stores also posted declines – albeit slower than the prior month. 
  • Nonstore retailers grew rapidly. 
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Reasons to Read

Coresight Research’s monthly reports keep you up to date on US and UK retail sales, US retail traffic and in-store metrics, selected US retailers’ same-store sales and key global consumer indicators. Click here to view our full collection of Monthly Reports.

Highlights from our October Retail Traffic report:

October US retail traffic and in-store metrics were a mixed bag, with fluctuations week by week and across regions. 

  • All regions posted sales and traffic declines in October 
  • The third week performed well in some areas  
  • The fourth week saw the largest declines other areas 
  • The northeast was affected by powerful wind storms, while the west experienced cool conditions 
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Reasons to Read

The pre-sale period for the 11.11 Global Shopping Festival this year began on October 21, and international and domestic brands were eager to use this time to launch promotional campaigns. We discuss the strategies employed by brands and retailers across different categories on Tmall to achieve a number of objectives:

  • Encourage early and high-value orders
  • Increase customer engagement
  • Promote store membership

Click here to read more Coresight coverage of Singles’ Day for 2019 and prior years.

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Executive Summary

  • The CEW Connected Consumer 2019 Conference
  • The beauty industry continues to evolve at a rapid pace in China.
  • Consumption in China is driven by a young, affluent and demanding generation, which has led to the advent to New and Boundaryless retail.
  • New Retail is evolving into Spectacular Retail in the West.
  • Western retailers are increasing spending on technologies such as AI to achieve Spectacular Retail.
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