Fortnum & Mason took more than 300 years to open its first standalone store outside Britain. In 2019, the up-scale grocer opened in Hong Kong’s K11 Musea on the Kowloon waterfront.
Carmen Chiu, regional MD, Apac, at Fortnum & Mason, a keynote speaker at next month’s MarketingPulse and eTailingPulse talked with Inside Retail about why the brand chose Hong Kong, the challenges of the past three years and how its approach to marketing and branding has helped define the retailer in Asia.
Inside Retail: What led to Fortnum & Mason choosing Hong Kong as the location for its first overseas store?
Carmen Chiu: Fortnum & Mason was founded in 1707, and we celebrated 315 years of heritage in 2022. We have always had a long history of trading around the world with our wholesale partners, particularly in Asia. We started trading in Japan around 50 years ago, and in South Korea in 2017, and we had been cultivating our partnership with Lane Crawford in Hong Kong for several years which gave us strong confidence to deliver a full Fortnum’s experience in Hong Kong with both retail and hospitality.
Hong Kong is a gateway to the world which made it the perfect location to introduce our first flagship store in Asia. Most recently we launched our first travel retail store in Asia at Hong Kong International Airport. Opening in Hong Kong helps to build on our goal of becoming a global brand with Piccadilly at its heart. No matter where our customers are in the world, we want them to experience the best of Fortnum’s.
Can you share with us who the consumers you target foremost in the Musea store are: is it ex-pat Brits living or visiting Hong Kong, local Hongkongers, mainland Chinese visitors and other tourists or a mixture of all of the above?
We opened our flagship store at K11 Musea in November 2019. It is fair to say no business would foresee the challenges we had back then. However, this has made us stronger as we learned through agility and ambiguity.
The business was set to run with 50 per cent tourists, but with Covid and the related travel restrictions, we were dedicated to serving our domestic customers which include locals and ex-pats living in Hong Kong. As the home of Christmas, we have observed almost 50 per cent of local ex-pats visiting us to celebrate at Fortnum & Mason.
With the recent border opening, we have started to welcome mainland Chinese and Southeast Asian tourists which are wonderful to see.
Opening Tmall and capitalising on our Chinese digital channels such as WeChat, Little Red Book and Weibo will encourage brand engagement for Chinese tourists, which we hope will help to act as a flywheel back to our Hong Kong store.
How does the range at Fortum & Mason’s K11 Musea store differ from that of the stores at Piccadilly and Heathrow? Have you made adaptations of product and balance to suit the Hong Kong market and do you sell any products exclusively here?
We carry around 500 products at our flagship store and some of them are Hong Kong exclusive. It is very important to have local understanding and continue to evolve our business relevantly, so we have implemented some localisation strategies for retail, such as creating exclusive products for the Mid-Autumn Festival and Lunar New Year.
Some items are exclusive to Hong Kong, for example, the Musea Blend tea and the Musea Bag for Life. The tea-infused mooncakes paired with Fortnum’s Teas in a beautiful Chang-E gift box have been developed for Mid-Autumn Festival and sold out the past two years.
For Lunar New Year we also carry a special product range to capture the local gifting season with the animal design.
At our 181 restaurants, we have reduced the sweetness and saltiness of our menu in Hong Kong because the taste palette here is different to that of the UK.
How did the company build a marketing strategy for Hong Kong which resonates with your local customers?
At Fortnum’s, we are here to deliver unforgettable experiences. In-store experience has been playing an invaluable part in brand building.
We initiated many in-person engagements when the situation permitted which included store and tasting experiences in retail and hospitality and small-scale events with media and influencers.
Besides being relevant for Mid-Autumn Festival and Lunar New Year, Fortnum & Mason is the home of Christmas. We love to keep our tradition by making joy for our little guests too. Our popular storytelling sessions with Father Christmas have proven to be the talk of the town over the last two Christmases. We even helped our customers to send more than 300 hand-written Christmas postcards to their loved ones around the world in December last year.
Word-of-mouth through our customers is also as important. Fortnum’s is a trusted brand and many share their experiences on social media which has been hugely helpful to build brand awareness.
How important is sustainability to Fortnum & Mason?
At Fortnum’s, we believe sustainability is a continuous journey and a long-term commitment. It is our responsibility to conduct business today in a way that is sustainable for the next 300 years.
Sustainability is all in the details. From our packaging to our supply chains, we’ve made progress. We are now focusing on how we innovate our products and business in a way that pays back to our planet. At times this may mean sacrificing short-term commercial gain for long-term success, but we know our customers want sustainable luxury. That’s our competitive advantage.
Given the success of the #LongLoveFortnums campaign run in Hong Kong last year, we continue to look for partners and marketing opportunities that reflect and align with our commitments by engaging with our customers to make this world a better place.
Can you tell us a little about your digital offer in Hong Kong? What customer groups does it target and how does it differ from your online offer in the UK?
Digital has been an instrumental pillar for us in the UK during the pandemic and the shift in consumer purchase behaviour. In Hong Kong, we have an online presence on Lane Crawford and K11 Musea platforms, however, our customers still prefer to visit us offline in person as we are very much an experiential brand.
We have learned that it may not be necessary to have our own online website dedicated to Hong Kong at the moment, but there are still many other established platforms we can leverage to acquire new customers and maintain customer relationships to build opportunities.
We quickly adopted digital platforms to enable us to maintain our customer engagement in a meaningful way, such as these examples:
● Deliveroo: While people were staying at home, they were still looking for special experiences to enlighten their days, so they would order the famous Fortnum’s afternoon tea on Deliveroo for a small gathering with their friends and families.
● Klook: With the popularity of staycations, we collaborated with the Rosewood Hotel to include a meal for guests at 181 Fortnum’s.
● Whatsapp for Business: This introduction has enabled us to build direct engagement with our customers.
● Social media channels: Actively engaging with our audience through social media platforms such as Facebook and Instagram has helped significantly with our storytelling.
Does Fortnum & Mason have a loyalty program for Hong Kong customers?
We are looking into launching our loyalty program in 2024. Our wonderful teams have delivered exceptional services to maintain their direct relationships with our loyal customers since we opened. For our 181 restaurant, we offer complimentary experiences via customer segmentation occasions.
Personally, you spent six and a half years in a senior role with chocolatier Godiva, which brought you in contact with Asia customers as well as those in other markets. How did that experience prepare you to lead Fortnum & Mason in Hong Kong?
No two businesses are identical but my passion for working for amazing global food brands has not differed. It is exciting to be able to identify growth opportunities and be part of the roller-coaster rides.
Knowing your brand differentiators and your customers is important, and persistence and agility determine success. There will always be experiences you can apply and new learnings to broaden your experience too.
Is the success of Fortnum & Mason Hong Kong likely to lead to other stores being opened in Asia Pacific or other Greater China cities?
Our Tmall Global Flagship store opened last June which enables us to connect with our mainland Chinese customers. As the world starts to recover, we were delighted to share the addition of our first travel retail location in Asia at the Hong Kong International Airport last December 1.
The 31sqm store offers a wide assortment of the brand’s most in-demand teas, biscuits, chocolates, tea accessories, and gift boxes.
I look forward to capitalising on the recovery of tourism/retail as Covid restrictions ease. We will continue identifying new opportunities in the region, but our top priority now is to drive growth for Hong Kong and the mainland as well as explore new markets during the next three to five years.
The MarketingPulse lineup
Carmen Chiu will share more about her uplifting brand revitalisation experiences at MarketingPulse, on the topic of “Brewing the future of Fortnum & Mason’s Tea: How to revive and evolve a timeless brand?”.
Besides Chiu, attendees can learn from seasoned marketers, including Dennis Chan, co-founder, chairman and creative director of the jewellery brand, Qeelin; Mauro Porcini, SVP and global CDO of PepsiCo; Margareth Henriquez, PhD, and Clément Brunet-Moret, global and Apac CEO of Baccarat, respectively; Brian Yiu, CEO of Fila China, Gao-na, head of overseas business, Hong Kong & Macao, at Mengniu Dairy and David Bell, founder of Pretty Ballerinas.
They will share the forum with next-gen brand pioneers including Gaëtan Belaud, global head of ads resellers at Spotify; Alex Zhou, chief customer officer of Chinese toy giant Pop Mart – that made blind boxes a craze – and Louisa Zhu, co-founder & CEO at Meta Human Centre of RM Group, creator of Ayayi, the first hyper-realistic virtual human in China; and more.
The conference will explore topics such as Web3, ChatGPT, Gen Z, virtual influencers, data-driven marketing, brand storytelling, design thinking, happiness and marketing, ESG marketing, the future of retail and borderless customer engagement.
A series of digital marketing and e-tailing workshops will offer a wealth of practical marketing knowledge and advice for participants. Representatives from about 40 companies will share innovative marketing strategies, bespoke solutions and technologies with marketing professionals and brand owners. Alongside the discussions, a one-on-one business matching service will be provided allowing marketing and e-tailing experts to offer professional advice while showcasing their solutions.
Marketing Pulse x eTailingPulse
Date: 15 March 2023
Website: https://www.marketingpulse.com.hk Book your ticket now using the 65 per cent special discount code for Inside Retail readers: MPR02J3P at https://bit.ly/3J1naTC