Why Sephora failed in Hong Kong – despite a ready market for its make-up and skincare

Hong Kong appears to offer plenty of make-up and skincare choices, but if you consider yourself a global citizen there’s a good chance your holy grail items aren’t available.

In “Asia’s world city”, it seems only a small percentage of people fitting narrow beauty standards are catered for.

Even among brands known for their extensive ranges, many shoppers are missing out. Take M. A. C Cosmetics’ Studio Fix Fluid foundation; Hong Kong stores carry 10 shades – out of 42.

That’s why in other cities, including Bangkok and Singapore, global cosmetics chain Sephora, with its huge selection of brands and products, many of them exclusive to its stores, has done so well.

It’s not that Sephora didn’t try in Hong Kong. It first opened in Mong Kok in 2008, but surprisingly called it quits just two years later. Why?

According to a 2017 market study by Nielsen, which does research for companies looking to expand, 96 per cent of female consumers in Hong Kong buy skincare or make-up products, and spend an average of HK$4,021 (US$512) a year. That’s a healthy spend, and with many people relocating to Hong Kong from cities with Sephora shops, the store should have maintained a strong client base. So what went wrong?

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Firstly, Mong Kok is not where Sephora’s main shoppers are: the international crowd made up of expats, immigrants, third-culture kids, and return migrants. Secondly, in Mong Kok, even if you want to splurge on cosmetics, you’re still more likely to spend on a brand you already know.

Also, “Mong Kok rent is too expensive, presumably, and I guess they didn’t do enough marketing to let people know they opened there”, says freelance writer Andrea Lo.

Lo may be right.

“Sephora is definitely more well known within the expat community in Hong Kong,” says Gabbie Lee, a Hong Kong-based make-up artist whose clients include Cartier and OK Magazine China. “They could have focused on more marketing and promotion, to educate local consumers on what Sephora is, and what it offers. Also, picking a location that is more ‘westernised’, like Causeway Bay, would have helped.”

Sephora does have a Hong Kong-specific website, but do people use it?

“I do shop on the website, but not as much as I would if it were stocked with all my favourite products,” said Kate Springer, a Pennsylvania native living in Hong Kong, who can’t find her beloved Drunk Elephant skincare or Yves Saint Laurent eye serum on sephora.hk.

Of course, those born and bred in Hong Kong, who’ve never tried brands so loved by its foreign population, do not feel the loss.

“I never shop on the Sephora website because we have so many other options. Also, Sephora’s delivery takes too long,” says Sylvia Leung, a legal officer for Emperor Entertainment Group, who was born and raised in Hong Kong.

Where Leung feels her needs met by what’s available in Hong Kong, others like Lee, Lo and Springer do not. Which is why, whenever possible, some of us will always include a visit to Sephora when travelling.

The Nielsen study also revealed that overseas shopping for beauty and skincare is rising: 10 per cent of female shoppers’ overall purchases made overseas are beauty and skincare products.

“I always shop at a Sephora when I visit a city that has a branch,” says Lo, who enjoys trying things on and asking for advice in stores.

Springer is the same: “(I go to Sephora to) experiment with new products, talk to a make-up artist about my colouring or brows, and just spontaneously binge on make-up products. It’s like an adult playground!”

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Make-up artists do the same.

“Whenever I travel to a city where Sephora is present, it will be the first shop I head to,” says Lee, who was in Venice to make up a bride for her wedding photos. “I went to Sephora in the Florence train station the minute I arrived.”

And if we aren’t travelling, friends bring Sephora products back for us.

So, Sephora, come on back to Hong Kong to cater to those of us who love to try things in person, and who love Tarte, Too Faced, Marc Jacobs Beauty, Cover FX, Drunk Elephant, It Cosmetics, Fenty … We need Sephora to fill the hole left by the Hong Kong beauty retail industry, which ignores the need to be more shade inclusive. We need it for days when we just want to go into Sephora to talk to other beauty lovers for tips.

Come back, but in a different location – and we will flock to your shelves.