Faced with a challenging environment in China, Tag Heuer is experimenting with a new e-commerce strategy and joining forces with the country’s second-largest online retailer JD.com to open a Web store.
Swiss-made watches have had a rough ride in China recently, with currency issues and the country’s crackdown on corruption causing many Chinese consumers to rethink luxury watch purchases.
Sales to China dropped 40 percent on the year in July, according to figures from the Federation of the Swiss Watch Industry, in part hampered by the Swiss central bank’s decision to unpeg its currency to the Euro in January. The franc has since soared, hurting exports across the board.
July’s figures don’t take into account the recent yuan devaluation in China, which is likely to make imports even more expensive for Chinese consumers, and therefore weaken watch sales in the country further.
Tag Heuer’s deal with JD.com gives the luxury watchmaker, which does most of its design and manufacturing in Switzerland, a new avenue to reach consumers in China, particularly up-and-coming high-end consumers in markets beyond traditional first-tier powerhouses, such as Beijing and Shanghai.
The e-commerce flagship store, which opens Monday, will offer designs specifically chosen to appeal to China’s online consumers, at a range of price points. Also featured will be a 360-degree virtual product display, to help consumers get as close to an in-store experience as possible.
Both companies said that JD.com’s reputation for dealing in genuine products was one of the major reasons for the collaboration. The move into e-commerce is a rarity for a luxury watchmaker in China, where concerns about counterfeit products still limit the relationships between high-end brands and major e-commerce platforms.
“The coming of age of China’s young consumers, combined with the explosive development of e-commerce, present an enormously exciting opportunity for innovation and growth,” Tag Heuer’s general manager of Greater China Leo Poon said.
“By deepening our access to our key target customer market in China through JD.com’s huge upwardly mobile user base, I am confident that this partnership will ignite unprecedented consumer interest in Tag Heuer’s premier luxury timepieces.”
To mark the opening of its first online flagship in China, Tag Heuer is, for a limited period, offering its Tag Heuer Formula One Women G.E.M. special edition watch exclusively to Chinese consumers on its JD.com platform.