Retailers try virtual make-up screens and in-restaurant games to counter online shopping

Watsons Singapore and Sephora Singapore introduced an app that allows consumers to try makeup virtually, whilst bars like Hopheads and Level Up combine a “playing element” into the food and beverage (F&B) bar concept.

Singapore’s retail sales index has been fairly positive, reaching 2% overall growth for the first four months of 2018, RHB Research said. Moreover, department stores (+3%) and consumer discretionary items like footwear & apparel (+4%) and food & beverage (+10%) have had higher-than-average growth. “This suggests higher spending power and willingness to spend,” said analyst Juliana Cai.

However, growth is not limited to the demand side. “The past three years of intensifying competition from e-commerce and muted consumer spending have compelled retailers to be less complacent, and they are now revamping themselves to reel in consumers to spend. Many retailers have not only embraced online platforms but also reinvested in physical stores to improve the overall brand experience,” she said.

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Cai spotted three retail trends that are being used to woo customers. Firstly, stores such as Watsons Singapore are “refreshing” their store image to attract millennial consumers. “Millennials are image-conscious and do not like to be seen stepping into an ‘uncool’ shop. As such, brands must constantly refresh their image to attract the younger crowd,” Cai said.

Sheng Siong’s outlets in new housing estates feature cleaner and more organised displays as opposed to older stores, which used to cater to lower-income consumers. Dairy Farm now incorporates a wine and dine section within some of its Cold Storage supermarkets, giving consumers more time to spend within the store.

In the health & beauty industry, Watsons Singapore and Sephora Singapore are “leading the game” by incorporating interactive digital screens that allow consumers to try on makeup virtually. “Such features are fuss-free, more hygienic and attract digital-savvy millennials to enter the stores to try on new products and have fun,” Cai said. “This encourages customers to try more products, have fun, and hopefully buy more.”

The analyst’s second observation is that flagship stores are on the rise. She said more firms have followed the steps of major retail players like Uniqlo (Singapore), Victoria’s Secret, and Apple to reinvest in physical stores to improve the overall brand experience by opening flagship stores.

Muji opened its flagship store in Plaza Singapura and even included a cafe along with new merchandise lines. Technology and electronics retailer, Challenger opened a flagship store in Bugis Junction.

Muji opened its flagship store in Singapore featuring new merchandise and a cafe.

Stores that follow this second trend are also engaged in the third trend, which Cai called the “concatenation of concepts” where food, play, and shopping are combined.

Bars like Hopheads and Level Up combine a “playing element” into the food and beverage (F&B) bar concept. “These bars not only offer a great place to lounge in, with food and alcoholic options, they also have arcade machines, card games, foosball tables, and beer pong tables for patrons to enjoy,” she observed.

In this digitalised era where food delivery apps are sprouting, the “playing element” at these bars gives consumers a more compelling reason to visit the physical outlets, Cai said. “It also encourages spending on F&B items, as customers receive tokens to play the arcade machines upon ordering alcoholic beverages.”

Level Up Bar features an entertainment centre aside from food and drink.

New arcades in Singapore like Cow Play Cow Moo and Fat Cat are also combining retail and bringing it to a whole new level. These arcades feature over 200 machines and, the analyst said, “bring back the fun of winning tickets.”

The arcades have a large redemption station with a wide selection of prizes. The prize selections include over 1,000 toys, collectibles, and board games. The winning tickets can be regarded as “currency” to purchase prizes.

The change of game plans amongst Singapore’s old and not-so-old retailers could kick the mundane retail scene back into action, and most importantly, push out consumers from their homes to spend. “This would also have a positive spillover effect on other brick-and-mortar players when shopping malls and districts see stronger foot traffic,” Cai concluded.

Photos from Watsons, RHB, and Level Up