“By 2025, and possibly even by 2022, one out of every two luxury buyers in the world will be Chinese.” Recently, Les Echos, a French newspaper, said in a report titled “China, the Promises of the Luxury Industry” that global luxury giants are optimistic about the Chinese market and actively cooperate with e-commerce to accelerate digital transformation.
The latest data released by Tmall also proves this trend. In 2020, “on average, we will open one flagship store per week” at Tmall. From January to March 2021, the sales volume of Tmall luxury platform LuxuryPavilion increased by 159% year on year, faster than the growth rate of the whole year of last year.
Since 2020, there has been a trend of luxury brands settling in Tmall. Luxury brands such as Cartier, Gucci, Prada, Balenciaga, Armani and so on have opened stores one after another. Up to now, more than 200 brands have settled in Tmall luxury products.
Starting this year, international fashion brands have stepped up their pace. In February, Saint Laurent, a subsidiary of Kering Group, was officially launched with the exclusive debut of limited-edition handbags. In March, FARFETCH officially opened, sending overseas direct mail for over 3000 brands; Subsequently, Van Cleef & Arpels chose Tmall for the first time, and now all the core brands of Richemont Group have entered the market.
Last year, outbound tourism almost stopped and the global luxury market suffered a contraction. But the Chinese market, which took the lead in recovering economic growth from the epidemic, has become the “life-saving straw” for luxury brands. According to Bain & Company’s research report on China’s luxury market, the global luxury market will shrink by 23% in 2020, while the consumption of luxury goods in China will rise by 48%. By 2025, China is expected to become the world’s largest luxury market, and e-commerce channels represented by Tmall will continue to lead online growth.
Betting on Tmall has indeed been an important part of the luxury group’s recovery. Take Cartier’s parent company Richemont Group as an example, its sales data for the first quarter ended June 2020 showed that the sales in the Chinese market increased by 68% in the same period, while the sales of all product lines and regions in the jewelry department declined, among which, the opening of the official flagship store of Tmall Cartier was an important driving force.
It is understood that in January 2020, Cartier opened Tmall flagship store, the opening day created a sales record — JusteUnclou series limited edition black ceramic bracelet sold out within 1 minutes. At the same time, we continued to innovate online experience in Tmall, initiated the advanced customization service on the whole platform, and held the first online live fine jewelry exhibition on the whole network.
In order to adapt to market changes and new consumption habits, global luxury brands have accelerated their layout and investment in Tmall in the past year, including global debut new products, global distribution of scarce goods to meet the needs of Tmall consumers, etc.
It is understood that during the Tmall Double 11 in 2020, many luxury brands will organize global goods transfer and offline stores transfer goods to ensure the surging demand in China. In January this year, Gucci, Cartier, Balenciaga, Burberry and other more than 130 brands released their “Chinese New Year” new products at Tmall. Yves Saint Laurent not only launched the new product exclusively after his arrival in February, but also put on sale a bag of “Manhattan alligator emblazon shoulder backpack”, which is hard to find and widely out of stock in the world, on Tmall.
Tmall also uses platform digital technology to equip flagship stores of luxury brands with AR fitting, 3D store display, online exhibition, customized services, etc., so that brands can communicate with online consumers in a more accessible and younger way.
At the end of last year, Tmall Luxury Executive launched the interactive gaming product “Cloud Luxury City” to join the Executive and attracted more than 20 luxury brands to join the Executive. Customers could one-stop experience the interesting VR shops, 3D interaction, AR triing-on of such big-name brands as IWC, Jacuer, Chloe, Burberry, Alexander McQueen, COACH, and Alexander McQueen, as well as the AR triing-on of such big-name beauty brands as Dior and Estee Lauder.
In addition, luxury brands also use Tmall to reach new people and expand potential market users. Through Tmall, the brand can reach the most abundant consumer groups in China at one stop and cover more areas that have not been covered by stores.