Last month, the inventor of bath bombs and hero of vegans, cruelty-free cosmetics retailer Lush Asia has opened a Naked store right in the heart of Hong Kong at Great George Street, Causeway Bay.
Hong Kong’s sluggish progress in sustainability and the eco-movement is the reason the UK-headquartered brand chose the city for its first Naked store in the region, after the concept’s success in Milan, Berlin and Manchester, says Lush Asia director Annabelle Baker.
“We have a real problem in Hong Kong … we are one of the most wasteful groups of people in the world,” she tells Inside Retail Asia in an exclusive interview. The company realised they would have to drive the initiative, “because it wasn’t going to come through legislation. And it wasn’t going to come from other companies. It was going to have to be us pushing it forward.”
That said, the concept of naked packaging had already begun to cut through to customers: some 55 per cent of the products sold in Lush Hong Kong stores last year were naked, unpackaged products.
“There is such a big opportunity to push forward in a different way and a different conversation.”
Baker believes the biggest barrier to consumers embracing packaging-free products is the convenience factor. Locating the Great George Street store right opposite a Causeway Bay MTR exit was intended to help eliminate at least one of the excuses locals may have for not buying “a viable, green alternative”.
To help boost awareness of the concept, Lush plans to host pop-up events in the store to drive cross-promotions and help raise awareness of other causes, given the brand globally does not buy advertising or pay fees to Key Opinion Leaders.
Digitising the Lush bath-bomb experience
Promoting the benefits of packaging-free products is one of several initiatives Lush is focused on right now in Asia, and beyond.
Lush Labs is an AR-powered app developed in house by its tech-research and development team. Made specifically for the new Lush Harajuku bath-bomb store in Tokyo, the app was designed to complement the customer experience in a store that has no demo stations or information signage. Dubbed as the Lush Lens, its AR feature can detect all of its bath bombs and show them in action, via video.
Traditionally, the success of the Lush in-store experience lies in the fizzing bath-bomb water demos and its overly friendly staff, but Baker asserts that the app still delivers engagement. “The customers get to experience the product in a way by smelling it, touching it and they can still have all the tangible elements, but not necessarily a water demonstration. But they can still see that on their phone.”
The Lush Labs app will be building its success based on the high penetration rate of smartphones in markets such as Japan and Hong Kong. The app is continuing to evolve based on customer behaviour and feedback. “It was working 60 per cent at the time [of launch], but thanks to its AI learning, in Shinjuku it has now reached 90-per-cent accuracy thanks to customers constantly providing feedback through the app.”
Baker says Lush is looking to release a native shoppable feature within the app, which currently only redirects shoppers to the website.
CRM, the analogue way
Lush stands out as a retail brand for its open approach to customers. “We don’t have a target market,” Baker explains. “We don’t market to a target [demographic] because we don’t store the data of our customers.”
Unlike the retailers that are struggling to figure out how to use their data, let alone capture it, Lush collects feedback from staff on the shop floor and understanding who their customers are by talking to them.
The company runs on an “omnichannel” approach whereby the customers can give feedback on what they want to see, helping the company create community-led products based on voting. Mark Constantine, the founder of Lush, is a public figure on Facebook where anyone can follow and interact with him. He uses Facebook to gain feedback on products and his business from the public. Lush customers, says Baker, are not only social media-savvy, but also very vocal. “They know that [their feedback] goes directly into senior-level staff, so they don’t have this view of being so disconnected with who’s running and operating the business,” she explains.
The manager of each Lush store is in charge of their own profit and loss, HR and how they manage their team – in a way as if it were their own business.
While the UK marketing team recently made headlines for “closing” its social brand channels due to the pressure of surviving based on algorithms on social media, each individual shop’s own channels remain, with Lush operating them as communities.
Competition and partnerships
Undoubtedly the trend of pure, organic and vegan cosmetics is starting to catch on in Hong Kong, with new start-up brands selling products based on Lush’s product range. Baker says she has no negative feelings towards local businesses and others selling products similar to Lush’s, such as solid shampoo bars, conditioners or body bars.
“That for me is really exciting, because that that demonstrates that people want to invest in this and are looking at new formats,” she says.