How Sasa lost its shine amid fierce competition

HK retailer paved way for other multi-brand beauty hubs, but has fallen behind its rivals

To some beauty lovers here, pink and white has become a garish combination to steer clear of in malls. But Sasa was not always poised to fail in Singapore.

On Monday, the Hong Kong cosmetics retailer announced that it is closing all its 22 stores here, although it has not confirmed when it would do so.

At its peak in the early 2000s, Sasa, which opened its first store in Singapore in 1997, was the go-to place for make-up and personal care products here.

Women flocked to its two stores, in Wisma Atria and Marina Square, picking up cheap nail polish and cooing over discounted make-up that had just hit the shelves.

Sasa carried some 700 brands, including premium labels like Chanel, Clinique, Elizabeth Arden and Ralph Lauren - offering up to 50 per cent discounts on some items. It paved the way for more multi-brand beauty hubs to set up shop here. French beauty retailer Sephora, which opened in Singapore in 2008, carries over 200 brands.

But before Sasa was an international beauty chain, it was a basement cosmetics counter in Hong Kong's Causeway Bay. Former salesgirl Eleanor Kwok, now Sasa's vice-chairman, ran the counter. Business was slow, until requests from customers for discounts on bulk purchases prompted the idea to turn it into a discount store.

Sa Sa International Holdings was officially founded by Ms Kwok and her husband Simon, the company's chairman and chief executive, in 1978.

It was listed on the Hong Kong Stock Exchange in 1997, and opened more stores in Hong Kong, Macau, Malaysia and mainland China. In Singapore, it opened 22 stores, including those in the heartland.

THREAT FROM ONLINE STORES

Sasa 's predicament in Singapore is what many retailers are facing - the presence of online stores. Not only e-commerce players such as Amazon and Alibaba, but big brands themselves are also getting closer to end consumers and selling products online themselves.

ASSOCIATE PROFESSOR LI XIUPING, from the National University of Singapore Business School, on the fierce online competition facing Sasa.

ALTERNATIVES TO SASA

I am a little indifferent because I now have options like (e-commerce platform) Shopee - except that I don't get instant gratification. I will have to wait for them in the mail.

MS SHIDA RAMLI, who frequents Sasa stores once every quarter, explaining why she is not particularly sorry to see the Sasa chain exit Singapore.

Sasa became a household name, its pink-and-white shopfront a common, homely sight.

FIRST-MOVER ADVANTAGE GONE

What may have worked in the past, however, does not always sit well today. The Sasas of today, located mainly in heartland malls, can be off-putting - a cornucopia of colourful brands slapped together under white lighting, with aisles too narrow to make browsing comfortable.

The company parallel imports some items - bringing in authentic goods but without paying for intellectual property rights - allowing it to price them more competitively. It has been compared to B&N Collection in the past, an early parallel importer of discounted cosmetics and fragrances. Sasa is also the sole distributor for certain brands.

Retail experts said Sasa's declining popularity has had to do with increasingly fierce competition over the years. The entrance of players such as Sephora, Korean beauty stores like The Face Shop, as well as pharmacies with expanded beauty ranges like Watsons and Guardian, has neutralised Sasa's first-mover advantage.

Associate Professor Li Xiuping from the National University of Singapore Business School said: "Sasa's predicament in Singapore is what many retailers are facing - the presence of online stores. Not only e-commerce players such as Amazon and Alibaba, but big brands themselves are also getting closer to end consumers and selling products online themselves."

Sasa's reputation as a discount destination, once its trump card, has also been affected now that more retailers can "sell their products at a heavily discounted price online", she said.

Sasa has also fallen behind competitors like Sephora that play to the strengths of their physical stores, Prof Li added. These include providing rich shopping experiences, educational sessions for customers and loyalty-building initiatives that go beyond mere discounts.

Just this year, Sasa added a Click n' Collect service to enable customers to place orders online and collect their items at a nearby Sasa store. According to its e-commerce site, Sasa also offers a privilege membership card and a mobile app.

But these no longer suffice in wooing customers, said associate professor of marketing Hannah Chang from Singapore Management University's Lee Kong Chian School of Business.

"The beauty care market is highly competitive in Singapore. Many of Sasa's competitors offer these same services, (as well as) what Sasa is known for - a large range of offerings, competitive prices and personalised services."

Former senior beauty editor at Cleo magazine Cynthia Chew felt the company missed an opportunity to expand its reach in the 1990s.

"Although they have been around for so many years, sadly, they haven't done much PR or taken any marketing initiatives to work with the media. In an industry where beauty brands are so saturated, I think this is necessary. The power of the press is not overrated," she said.

NO LOVE LOST?

Ms Shida Ramli, 28, frequents the Sasa stores at Bugis Junction and Bedok Mall once every quarter, solely to pick up two Sasa-exclusive brands: American cosmetics label theBalm and Korean skincare brand Dr G. "I get better deals on these products at Sasa as compared with shipping them in myself," said the associate business director at a media agency.

But she is not particularly sorry to see Sasa go. "I'm a little indifferent because I now have options like (e-commerce platform) Shopee - except that I don't get instant gratification. I will have to wait for them in the mail."

As for Ms Eileen Wee, 42, it has been almost a decade since she last shopped at Sasa. The managing director at a beauty PR firm used to pick up tools like tweezers and cotton pads there, but later took her business to drugstores and personal care stores "which were running more attractive promotions".

"Even back in Sasa's heyday, I gravitated more towards the department store (beauty counters)," she said, but added that she will miss Sasa. "I have fond memories of Sasa. They had fun make-up 'play' stations that allowed me to experiment with colours and textures."