Watson’s Banking on Private Brand

Watsons StoresThe Taiwanese daily English-language newspaper ‘Taipei Times’ ran this interesting interview with Taiwan based Watson’s Personal Care Stores Co Ltd, the nation’s largest cosmetics and drugstore operator with about 450 stores in the country. The retailer is aiming to win over customers this year with new strategies that managing director Toby Anderson discussed with the newspaper staff reporter Amy Su in an interview last week

Toby Anderson - watsonsTaipei Times (TT): Earlier this year, you said that Watson’s has the potential to be very successful in marketing its store-brand products. Could you share the company’s vision for developing these types of products this year?
Toby Anderson
: We believe that Asian markets represent a great opportunity for Watson’s-brand products.

Housebrand (Private Brand) product awareness has been built in the US and European markets for years, with 40 percent of retail revenues are from self-brand products, compared with 5 percent recorded in Asia.

The company aims to increase the proportion of revenue generated by its own-brand products in Asia to 10 percent over the next few years by expanding the product range.

Given the increasing pace of growth that Watson’s-brand products have recorded over the past few years, we expect revenue generated by these products to outperform overall product sales in the next few years. For example, our data show that overall sales grew by between 2 percent and 3 percent last year, while sales of our own-brand products more than doubled.

TT: How do you plan to strengthen sales of your own-brand products in Taiwan this year?
: Given the current retail trend of super bargains, Watson’s is planning to maintain its fair pricing strategy on own-brand products to boost sales.

Currently, the company carries more than 500 store-brand items in Taiwan, such as Watson’s tissue packs manufactured by YFY Group, which are performing very well and selling 150,000 units a month.

In addition, we are also aiming to launch more premium-priced store-brand products in Taiwan, starting with a skincare brand that is to be introduced next week, following the product range’s success in South Korea.

TT: Aside from focusing on own-brand products, what are Watson’s other strategies for developing in Taiwan this year?
: In keeping with a worldwide brand refreshment initiative devised this year, we launched a brand renewal campaign in Taiwan last month by refreshing our services, logos and store decorations. For example, our newer stores that have more space will now offer healthcare counseling services by pharmacists.

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Christopher Durham
Christopher Durham is the president of My Private Brand and the co-founder of The Vertex Awards. He is a strategist, author, consultant and retailer who built brands at Delhaize-owned Food Lion, and lead strategy and brand development for Lowe’s Home Improvement. He has consulted with retailers around the world on their private brand portfolios including: Family Dollar, Petco, Staples, Office Depot, Best Buy, Metro (Canada), TLW (Taiwan) and Hola (Taiwan). Durham has published five definitive books on private brands, including his first book, Fifty2: The My Private Brand Project. In 2017, he will debut his newest book, Vanguard: Vintage Originals, a visual tour of innovation and disruption in private brand going back to the mid-1800’s. Dynamic in his presentation while down to earth and frank in his opinions, he has presented at numerous conferences, including FUSE, The Dieline Conference, Packaging that Sells, Omnishopper and PLMA’a annual trade show in Chicago. Durham lives in Charlotte, NC with his wife, Laraine, and two daughters, Olivia and Sarah.