Global executive search firm CTPartners warns that as international retailers in Asia Pacific turn from rapid expansion in brick-and-mortar locations to pursuing sustainable investment and profitability in the region, demand for a ‘new’ breed of retail leaders is driving up remunerations by some 20 per cent or more.
“This is especially evident in Asia’s luxury retail sector, where many Western brands sought to quickly expand into the region over the last five to 10 years, particularly in the world’s largest luxury markets today, China and Japan,” said Tim Boerkoel, New York-based global head of the consumer and retail practice at CTPartners.
“But the onslaught of mobile commerce, increasing competition and soaring retail property costs mean that today’s retail leadership focus has shifted to enhancing regional profitability more than rapidly opening new stores. Thanks in part to the impact of social media and e-commerce, retailers are also looking for executives with a deeper, wider toolbox of skills that also include both brand and consumer marketing skills,” he said.
In 2012, business-to-consumer (B2C) e-commerce sales in Asia-Pacific grew more than 33 per cent to $332.46 billion, estimates eMarketer, with Asia surpassing North America to become the world’s number one market for B2C e-commerce sales.
This year, the region will see sales increase by more than 30 per cent to over $433 billion – accounting for more than one-third of all global B2C e-commerce sales. This will mostly be driven by growth in China.
According to a governmental report released by the China Internet Network Information Center (CNNIC), over 240 million people bought something online in China in 2012, with the majority shopping through Alibaba’s Taobao and Tmall marketplaces.
In its just released Asia 500 report, Internet Retailer said: “Asia is a series of diverse national online retail markets, each with its own distinct audience of web shoppers and at its own stage of e-commerce evolution.”
CTPartners says that retailers are increasingly searching for senior executives with six qualities:
- Keen financial acumen
- Digital aptitude (social media, e-commerce, multi-channel sales)
- Asia Pacific multi-market expertise
- Ability to lead through transformative change
- Supply chain management know-how
- Ability to be a good brand ambassador
“Some companies are even turning to hiring from outside their own industries, in order to sidestep the talent shortage for experienced leaders and managers with these qualities,” said Sarah Lim, a London-based partner at the retail and consumer practice at CTPartners.
“Ralph Lauren’s president for Asia Pacific for instance, came from the gourmet and specialty foods sector. The current CEO of Levi Strauss was brought in from Procter & Gamble. Incidentally, he also served on the Economic Development Board of Singapore and was a member of the US-ASEAN Business Council in Singapore.”
The executive search firm also predicts that retailers in Asia will increasingly promote younger retail executives into leadership positions.
“E-commerce and multi-channel expertise are perhaps the most highly sought-after leadership skills in the retail industry today. That’s true around the globe,” said Lim.
“Such digitally savvy leaders tend to be younger and in the consumer services, media and mobile communications sectors. This drives the cross-industry executive searches. Take Mothercare for example. Their recently appointed CEO is just 48 years old and was recruited from an online DVD and digital entertainment company that is now part of Amazon Inc.,” she explained.
