SHANGHAI — Los Angeles-based online retailer Revolve launched in China eight years ago and the country represents its largest market outside the United States but the company hadn’t invested in local customer service or China-focused marketing efforts until recently.
“What we’ve seen is the consumer coming to us without us really courting them. They’ve become educated enough to be aware of what we’re doing, the surprise is that they were coming to us before our service levels were really there. The basics we thought we would have to invest in first to succeed, we actually had the consumer come to us first,” cofounder and coceo Michael Mente said last week on the sidelines of an event here.
Mente said he sees huge potential in the China market for Revolve, which sells laid-back, beachy L.A.-style apparel from brands like Lovers + Friends, Wildfox Couture and Mother. Though the company doesn’t break out revenue numbers by region, Revolve posted sales in excess of $400 million in 2015 and plans to be a billion-dollar business in four to five years. Mente said Revolve’s first-quarter China sales grew 70 percent — and he doesn’t expect that growth to stop anytime soon.
“In 10 years from now we think the Chinese market could be as big as the U.S. market for us,” he said. Revolve began to offer free express shipping to China in the first quarter of this year.
China is the world’s largest e-commerce market, with data from eMarketer valuing it at $672 billion (the equivalent of 40 percent of the worldwide e-commerce market). The market in China is extremely concentrated, with the two biggest players — Alibaba and JD.com — accounting for more than 80 percent of business-to-consumer sales online in the country, according to Beijing-based market research firm iResearch.
“We need to lay some groundwork to make sure we understand the ecosystem here,” said Mente, who noted that the Chinese e-commerce landscape seems more advanced than that of the United States in terms of payment methods, app integration and mobile commerce.
Revolve hosted a pop-up Social Club event in Shanghai last week to connect with VIP customers and influencers.
The influencers came from around the world, with a focus on fashion bloggers who have a following in China — often because of their Chinese ethnicity. They included Vanessa Hong, a Vancouver-based influencer who blogs at her own The Haute Pursuit site, who has more than half a million followers on Instagram, as well as Macau-born, Singapore-based Yoyo Cao, who is known online as yoyokulala.
The company has built its marketing in the West around celebrities, events and “getaways” that are subsequently plastered on social media. Mente said he thinks Revolve’s connections to personalities like Kendall Jenner and Gigi Hadid resonate with internationally minded Chinese consumers. But he is also working on building a roster of more China-specific influencers.
“From our perspective, the way we like to go about things is more long-term. It’s easy to pay to play, but for us it’s really important to find people who see the world the same way we do,” he said. “Who can we collaborate with and build mutually beneficial relationships with? We can promote them, and introduce them to a global audience, they can obviously promote us, and that will obviously take some time for us to develop.”