Retail sales value of the personal luxury goods amounted to around US$105 billion in 2017, ranking second only after the United States. However, 2019 will likely be a year of turbulence for the luxury industry in China due to ongoing U.S.-China trade disputes and China’s economic slowdown as well as changes in Chinese consumers’ mindset and shopping behaviours toward luxury goods. Accordingly, strategies that once worked so well may not yield that impressive results like before. In this article, we discuss trendy and innovative strategies for luxury brands in China in 2019.

 

Innovative strategies for luxury brands in China in 2019

 

1. Strategic partnerships with Chinese Top Apps/ Platforms 

It is kind of CoBranding… and most of the platforms in China wants to be associated with Premium Brands, and you will beneficiate of the visibility of these APP.

Partnership + Creativity + Virality = Cocktail of Success in 2019 

Chinese customers do not browse the Internet for .cn website. They live in a mobile world of apps. Two most powerful apps are WECHAT and ALIPAY which are extremely functional. They connect to other multiple apps and allow users to perform different daily activities without ever leaving their ecosystems. Exploring and teaming up with these influential local players is a good way to not only broaden your exposure but also enhance trust with Chinese audience – a crucial point for overseas brands.

  • Brands, such as Singapore Airlines and Shangri-La Hotels and Resorts, are teaming up with online travel platform Fliggy to help them connect with customers.
  • Alibaba Group and Richemont, a Switzerland-based luxury goods holding company, announced a global strategic partnership with the purpose of bringing the retail offerings of YOOX NET-A-PORTER GROUP S.p.A. (YNAP), the world’s leading online luxury retailer, to Chinese consumers.
  • They will launch the online stores on Alibaba’s Tmall Luxury Pavilion, an exclusive platform dedicated to the world’s leading luxury brands. Alibaba supports YNAP by providing technology infrastructure, marketing, payments and other technologies.

  • Farfetch and JD.com also expand Strategic Partnership to build the Premier Luxury Gateway to China. By that, JD.com’s 300 million customers will have access to more than 3,000 luxury brands through Farfetch’s network and in return, Farfetch gains ‘Level 1’ access on the JD app.

With Chinese consumers expected to account for nearly half of the global luxury market by 2025, strategic partnerships with key apps and platforms would bring luxury brands unprecedented access to the world’s largest market of consumption, as well as enable Chinese customers to enjoy unique and seamless online and offline shopping experiences.

 

2. Maximize your presence on E-commerce Platforms

 

Stop to think only Offline … 

80% of Chinese buyers are under 35 years of age.

 

 

 

  1. They are highly fascinated by western brands and have high internet consumption.
  2. Therefore, online shopping for luxury goods continues to grow.

 

 

Tmall and JD, the two leaders of e-commerce in China have launched in 2017 their dedicated platforms for luxury brands, respectively called “The Luxury Pavilion” and “Toplife”. These high end websites bring the online shopping experience to a new level with a luxury touch. Secoo is also a new luxury and lifestyle e-Commerce platform to consider. These platforms can be fiercely competitive since all brands want to be there. They have a large user base to tap into but it is not enough to only appear on their platform. Your brand must execute a comprehensive marketing strategy to gain visibility and generate sales.

 

You have lot of Chinese High End Platforms and they will like to have special offer for your Brands, with a special offer or special Campaign

Everything is possible when you are a Premium luxury Brands with awareness.

 

 

3. Enhance the Omni-channel experience

 

The new generation of Chinese luxury shoppers tends to shop both in stores and online. The penetration of online luxury goods market was forecasted to reach 13 percent by 2021, which encourages many brands to engage their Chinese consumers through Omni channels that combine store and online experiences. Luxury brands need to fully integrate online, offline, technology, and logistics to deliver the 4 C’s: consumer centricity, convenience, customization and consumer contribution. One way to accomplish this is by working closely with Alibaba, JD/Tencent and Little Red Book… to be present in all of their habitats (marketplaces, brick & mortar footprints, social commerce apps, cross border).

Xiaohongshu is planning to complement its online reach with a bricks-and-mortar store in Shanghai, which emphasizes the growing importance of offering a seamless omni channel experience to customers.

 

 

4. Increase e-personalization

It is still about understanding target markets and being smarter in connecting and engaging with them. Luxury consumers want to feel special, loved, and there are increasing tools available for brands to assist with this. One example is facial recognition, which is starting to take off in China, allowing brands to develop individual profiles on customers to provide a truly personalized level of service that is authentic and thoughtful. This should be incorporated into new store openings, KOL campaigns, social and e-commerce.

Stop think offline experience and open your mind to your Client online Journey

 

5. More sophisticated KOLs marketing

Collaboration with KOLs needs a deeper level and more creativity. Pure appearance of brands with KOLs can no longer be effective. Both brands and KOLs need to work on more innovative content and different ways to connect emotionally with customers.

6. Continue to innovate with SOCIAL MEDIA

 

WeChat, Weibo, Little Red Book, Douyin. With more smartphone users than any other country, mastering social media in China is a must for brands to connect with consumers and make sales.

More than 80 percent of Chinese luxury shoppers are on social media. They are also using networks on their favourite platforms to research products and brands before they buy.

Around 443 million Chinese consumers will shop on their smartphones this year, and their purchases will account for more than 75 per cent of total online retail sales, according to eMarketer.

Wechat

 

STOP TO BE BORING ON WECHAT 

The ugly truth 80% of luxury Brands are boring on WeChat

 

 

WeChat now has over one billion active users. As such, it’s become one of the most popular platforms for brands to reach Chinese customers in convenient and innovative ways.
At the beginning, Wechat was an app for communication but it has developed a lot of features: Wechat users can message their friends, pay bills, shop online, and share content. Additionally, mini-programs, sub-apps that exist within WeChat allow users to access numerous brands and services without the need to exit the app.

On WeChat it is not about My Brand, it is about their Lifestyle 

 

Innovation creates Buzz 

Mini-programs have been a favourite tool of luxury brands to attract and engage with customers. Mini-programs can allow brands to direct their followers to purchase recommended products in an extremely convenient and smooth way. Additionally, brands can adopt mini-programs for e-commerce, membership programs, event management…

Besides, WeChat’s updated search function also offers opportunities. WeChat has an edge in search, as the social feature has enabled it to be like searching on Facebook, adding the word-of-mouth effect that search giant Baidu cannot match.

Gamification engage users

High-class brands can also employ gamification to attract and hold the attention of WeChat users – particularly millennials and Gen-Zers who are, of course, already drawn to mobile games.

In conclusion, luxury brands should optimise WeChat more with innovative ideas to expand their branding and make their products stand out.

Weibo to Maximize Exposure

Weibo has been a boon for luxury brands over the years. WeChat with its quite private nature isn’t designed to support viral content, but Weibo is. Brands target the platform’s 411 million monthly active users often by working with celebrities, whose large followings tend to drive conversations.

They can also take advantage of Weibo’s live-streaming platform and “Weibo Stories”, which is similar to Instagram Stories or share contents which link to their e-commerce stores.

 

Weibo Fensitong is a great tool to target High End Customer and luxury Lovers.

  • It is a cost-effective way to work on your awareness…
  • It is THE only Cost effective way actually. 

 

Douyin + Toutiao 

 

DOUYIN

Douyin, better known as Tik Tok overseas, allows users to upload 15-second videos made by themselves that they can edit with Snapchat-like filters and share with their followers. Content creators with a certain number of followers can also live-stream on Douyin.

Brands are seeing Douyin as a key platform to reach China’s Generation Z, or consumers under 24 years old, who are among the site’s 154 million monthly active users. More than 60 per cent of them are affluent women living in China’s first- and second-tier cities.

 

Michael Kors was the first luxury brand to work with Douyin and since then, brands such as Dior and Tommy Hilfiger have tried out the platform. Its huge user base has also attracted numerous A-list celebrities and KOLs, including actress Angelababy and singer Kris Wu. Even e-commerce companies, including the luxury e-tailer Secoo, have a presence on the platform.

Toutiao is becoming the number one Media platform in China. 

It was for young people and more and more is becoming popular among 80s generation.

Toutiao allows you to have an official account, and share news (like Weibo)
Their Ads system is quite similar to Weibo/Facebook.

 

 

Xiaohongshu / RED 

 

While big-name luxury brands in beauty sector are the major winners on Little Red Book, known as Xiaohongshu in Chinese or, simply, Red. The app’s original purpose is to help millennial Chinese shoppers, mostly women, educate their friends and followers about cosmetics sold overseas.
It now serves nearly 100 million users and has its own cross-border e-commerce platform.

Cosmetics and skincare brands are benefiting greatly from the app’s highly engaged users who trust and purchase according to  reviews posted by other shoppers and influencers.

 

Leading luxury brands like Gucci, Christian Dior, Louis Vuitton, and many others had a fruitful year in 2018 in terms of engaging with Chinese consumers, building up brand awareness and popularity, and generating sales. However, as consumers are becoming more sophisticated and the luxury goods market is being saturated in China, brands have to be well-updated, innovative and thoughtful to maintain their image and position in this rough market.

We have a White Book available to download (just send us an email to receive it)

 

OUR CASE STUDIES WITH LUXURY BRANDS IN CHINA

1. Les Georgettes: high-end and creative jewellery 

2. D’Auchel: Luxury leather goods from France to Hong Kong

 

3. Jean Rousseau: Authentic French leather work

 

 

More Case studies available (by email) Only

 

 

GMA STORY 

 

GMA luxury Division China

Wechat Solution marketing Agency China

 

 

 

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This article is for the advanced marketers working in the Luxury industry and we will analyze the top Innovative Marketing Strategies for Brands in 2019 in China.

Over the past decades, Chinese consumers have taken the lead in luxury shopping.

Despite China’s slowdown in economic growth, the crackdown on gifting as well as weaker currency, the luxury goods market remains strong.