The Digital Conversation: China leading the way in e-commerce for the luxury industry

The Moodie Davitt Report presents the latest edition of regular column The Digital Conversation, in association with Shiseido Travel Retail. In this report we assess the main findings of the Luxury Society and Digital Luxury Group-hosted Luxury Society Keynote event in Shanghai last month. 
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CHINA. E-commerce is changing rapidly in China as the boundaries between online and offline are being blurred and new technologies come to the fore.

Over 150 luxury industry executives from brands such as Dior, Swarovski, Bulgari, and LVMH took part in the second edition of the Luxury Society and Digital Luxury Group-hosted Luxury Society Keynote event in Shanghai last month.

Speakers at the event noted that augmented reality, virtual reality, and livestreaming are key technologies now being used in China. Brands are shifting their focus to appeal to millennials, who are seeking experiences and emotional connection as well as content.

Mei.com CEO Thibault Villet highlighted the value of livestreaming in a presentation that can be viewed below. Mei.com is a luxury fashion e-commerce platform in China, and online giant Alibaba recently invested in the company. Villet told delegates that his key aim was to enhance the online experience for the platform’s young and fashionable customers, and that technology was vital to achieving this.

A livestreamed fashion show run in collaboration with retail website TMall received over five million views, he said, with 65% of the products featured in it selling out quickly.

He said the next step is to integrate virtual reality, and the company is experimenting in this area. “In one promotion we created a video with three different scenes, and people can wander between them. The idea is that people can choose their own style, and through the virtual reality view can understand what we are doing in the promotion.”

Mei.com also launched a weekly e-magazine in October 2015 that aims to inspire members with content covering 20 different lifestyle areas.

Thibault Villet, Co-Founder & CEO
Mei.com CEO Thibault Villet stressed the importance of adapting to the desires of Chinese millennials

Arthur Zhang, CEO of retailer UCO Cosmetics, noted that the “early stage” e-commerce model of simply providing a platform to sell products online was already dead. He added his voice to the many at the event stressing the importance of using new technologies to offer different and engaging content.

DLG China Partner & Managing Director Pablo Mauron put it succinctly: “The millennial generation in China, which already accounts for 300 million people, seeks experiences and emotional connection, they’re not just a bystander. As a result, livestreaming has become a medium for them to express themselves.”

Mauron explained how brands such as Maybelline, Montblanc, Swarovski and Dior are taking advantage of these new opportunities in his presentation, which can also be viewed in full below.

Social media is another key tool to reach and engage customers in China, with WeChat a particularly significant medium. Four Seasons Hotels Director of Marketing Communications in Asia Pacific John Hamilton said customer relationship management (CRM) on social media allowed for highly-targeted messaging and engagement. He said the luxury hotel chain had acquired meaningful data about its customers, which in turn has driven growth.

Four Seasons Hotels has developed a CRM-led content strategy on WeChat through a gradual process of trial and error and optimisation over the past year, he said.

Panel on embracing new technologies with Di Fu (Baidu), Oosha Zheng (Blackbow), Jenny Tu (Yixia Tech), and Thibault Villet
Baidu’s Di Fu, Blackbow’s Oosha Zheng, Yixia Tech’s Jenny Tu, and Thibault Villet during a panel session on embracing new technologies

The Luxury Society Keynote event also explored the impact of celebrity and key opinion leader partnerships in China. Easy Entertainment Commercial Director Qing Dai said there were many success stories where luxury brands had been paired with appropriate celebrities, with a recent example being Cartier’s collaboration with hugely-popular singer and actor Lu Han.

Cartier is the most searched luxury watch brand among the generation born between 1990–2000, according to data from search engine company Baidu. The Lu Han collaboration is considered a major reason for the brand’s popularity, according to Baidu General Manager for East China Wan (Grace) Zhang.

Pablo Mauron, DLG China
DLG China Partner & Managing Director Pablo Mauron said millennials could express themselves in livestreaming events
David Sadigh, Founder & CEO, Digital Luxury Group, opens up the day
Digital Luxury Group Founder & CEO David Sadigh opened the event

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