Chinese shoppers walk past a Cartier display in Beijing.

HONG KONG — The online landscape in China is difficult for any foreign brand to master with its ecosystem of tech companies distinct from those in the West. Instead of Google, there’s Baidu. In place of Facebook, there is WeChat. Instead of Twitter, there is Weibo, and replacing YouTube is Youku. The list goes on.

While some luxury fashion brands such as Céline and Patek Philippe are abstaining from going online, the growing majority of fashion brands see digital channels as crucial to a successful commerce strategy in China, and a new report from research firm L2 dissects how well fashion brands are approaching the country online. In its “Digital IQ” Index, L2 studied 89 fashion, watch and jewelry brands, rating their digital competence in China.

Their conclusion? Burberry and Cartier are winning so far with robust online strategies that include strong celebrity partnerships, an integrated and informative WeChat presence, real-time shopping and an omnichannel experience.

Below are highlights from the report:

L2's China "Digital IQ" fashion brand ranking

L2’s China “Digital IQ” fashion brand ranking. 

It doesn’t necessarily include Tmall or JD.com. 

Without full control of search results on online marketplaces, brands are not necessarily convinced they need to be on Tmall or JD.com, with a good number trying to do their own operations. The number of brands joining Tmall and JD.com has remained stagnant, although JD.com has just appointed a new head of fashion to court Western brands to the site.

“Coach closed its Tmall store in September 2016, leaving only 21 percent of fashion brands on the platform,” L2 said. “Watches and jewelry brands are still experimenting with Tmall, and Pandora and Tag Heuer both launched stores on the platform in the last year.”

“Direct-to-consumer e-commerce and WeChat commerce increased significantly between 2014 and 2017. In 2014, only 20 percent of fashion brands and 14 percent of watches and jewelry brands had DTC e-commerce. Today, that share has risen to 40 percent of fashion and 38 percent of watches and jewelry brands,” the study said.

Another route is the use of international luxury platforms, which are growing in China. The report explains, “Farfetch leads with 83 percent of fashion brands distributing on the site — up 12 percent from 2016. Yoox, Net-a-porter, and Shopbop also increased their brand rosters in the past year.”

WeChat commerce is still an experiment. 

Six percent of fashion brands and 14 percent of watch brands in the study operate a WeChat store, and IWC Schaffhausen and Cole Haan only offer DTC via WeChat. However, “most of these forays into WeChat commerce have been one-off, limited-time sales, and it remains unclear whether the platform is scalable.”

The study points out that brands are neglecting to make all their information available on WeChat. “While 84 percent of luxury brands list their international store locations on their brand site, only 36 percent provide airport locations, and less than a quarter enable geolocation of overseas stores via WeChat. Failing to engage Chinese consumer prior to and during their trips is a missed opportunity for luxury brands,” said L2.

In video, Youku is becoming less relevant, Miaopai gaining ground. 

Youku, China’s YouTube equivalent, is losing favor among luxury brands with the adoption rate falling 16 percent year-over-year, as average Youku views per video drop 85 percent year-over-year. Short video sites like Miaopai and live-streaming platforms are attracting more eyeballs. Fifty-eight percent of brands now keep a Miaopai account, posting an average of 2.75 times per month. Miaopai videos receive an average of 73,700 and 140,412 more views per video for watch and jewelry, and fashion brands, respectively, compared to Youku.

That being said, there are some exceptions to the rule. Cartier had Lu Han promote its Juste un Clou collection in a 45-second ad that received more than 10 million views on Youku, more than twice the number of views of any other brand video on L2’s index.

When it comes to celebrities and KOLs, choose carefully. Also, bigger is not always better.

Megastars such as Fan Bingbing and Tang Yan have some of the biggest online followings but they have not resulted in the highest overall engagement, the report found.

“Actress Liu Shishi has nearly 27.8 million fewer Weibo followers than Fan Bingbing, yet her collaboration with Tory Burch saw an amplification more than four times greater than that of Fan Bingbing’s collaboration with Louis Vuitton and 47 times greater than that of Fan’s collaboration with Valentino,” L2 said.

The report’s research period cut off in April and so did not include the controversy over Dior appointing actress and model Angelababy as its China ambassador in its index. Many online voiced their disappointment at the brand, saying Angelababy didn’t fit with the Dior image, accusing her of denying plastic surgery. Jaeger-LeCoultre, too, received heat when the brand enlisted irreverent comedian Papi Jiang as an ambassador.

L2’s Danielle Bailey, head of APAC research, and Liz Flora, editor of APAC research, said, “in the gold rush for brands to attach themselves to Chinese celebrities there are bound to be missteps” and advised that brands do due diligence on any given celebrity or KOL.

“Even if they [the KOLs] have a large presence on Weibo or WeChat, it’s important to check that the numbers are the result of fans’ organic interest, as well as determine brand fit and alignment with brand values and ensure the celebrity is not overexposed,” they said.

While Dior has taken a hit momentarily in China, the team believes its diversified and robust online strategy, which includes use of WeChat flash sales and live-streaming, will help it weather the storm.

“Brands that invest in their online presence across multiple channels are much better positioned to withstand p.r. pitfalls than those which rely solely on celebrity-focused campaigns to reach Chinese customers,” L2 said.

L2 identified Bulgari’s ambassador Kris Wu as the most influential idol in China, and Hu Ge, Xu Weizhou, Lu Han and Liu Yifei as other key personas.

Burberry, Cartier showing the most digital-savvy.

L2 lauded how Burberry has twice provided see-now-buy-now opportunities for Chinese customers, and its smart choice of celebrity partnerships.

The first real-time buying opportunity was for the brand’s fall 2016 show, which also provided a special-edition bag sold exclusively on WeChat. It did see-now-buy-now for its most recent show, inviting Kris Wu, sometimes dubbed “China’s Justin Bieber,” and actress Zhou Dongyu to attend. In May, it enlisted superinfluencer Mr. Bags to release a special-edition handbag for sale via WeChat.

As for Cartier, it worked magic on Valentine’s Day with a limited-edition sale. While brands such as Givenchy, Dior, and Bulgari did the same, Cartier’s had an omnichannel twist.

“Out of a set of 150 pink gold bracelets, the first 88 were to be delivered to the recipient in person by singing ‘Cartier Boys’ if they were located in one of 25 Chinese cities, while the remaining orders arrived with red roses,” L2 said. It was promoted by key celebrities like Lu Han, Ma Sichun and a host of prominent KOLs.

“Cartier sold out of all bracelets within a week, and recipients posted their photos with the delivery boys on social media,” L2 said. “While Givenchy’s Valentine’s Day WeChat ash sale and Dior and Bulgari’s Qixi Festival sales aimed to drive foot traffic to the stores after items sold out on WeChat, Cartier was able to gain visibility for its permanent WeChat boutique.”

The firm added: “During the campaign that lasted from February 6 to 14, Cartier received its highest single-day sales in both number and volume since the May 2016 launch of its WeChat store.”

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