SHANGHAI — The Luxury Society and Digital Luxury Group hosted their 11th Digital Luxury Keynote conference here Tuesday.
It was the first time the conference had been hosted in China and, according to Digital Luxury Group founder and chief executive officer David Sadigh, it made sense to do so given the theme of “Reaching the Chinese Consumer.”
“There is no one in the world that isn’t focused on China. Everyone knows they must operate in China, they must understand China and what is happening in China,” he said.
The conference featured sessions focused on the potential for social customer relationship management using China’s WeChat, which boasts more than 600 million users and is used by Chinese users as everything from a way to show off their holiday experiences and luxury purchases to their friends, a way to take in news, play games, and a widely used payment platform.
Panel discussions included the value of key opinion leaders in China. Popular bloggers are increasingly being utilized by luxury brands, and as their perceived value increases, so too does the price they command for their approval of a brand or product.
“My fans find my opinion more authentic than a celebrity,” explained Michelle Ye, a Chinese blogger who has been read by millions since 2010. “The more I know about the brand the more closely we can work together, the better result I get.”
China’s most popular search engine, Baidu, presented data about luxury-related online searches, encompassing 80 brands across the watch, jewelry, ready-to-wear and handbag sectors. The data were collected over a 12-month period to July of this year, and more than 700 million luxury-related searches were logged, 28 percent of them on mobile.
A final panel discussion looked at the potential scope for selling luxury online in China, given recent research from KPMG that estimates up to 50 percent of the country’s domestic luxury consumption will be generated online as early as 2020.
There was some disagreement among panelists about the potential for China’s e-commerce platforms — long known for cheap goods, deep discounts and fakes — as a feasible method for selling full-price ready-to-wear and leather goods.
“I don’t see a lot of $500 shoes being sold. I don’t know whether Tmall is a viable [site] selling luxury,” said Josh Gardner, chief executive officer of data analytics and optimization firm Kung Fu Data.
“It’s easy to sell $100 to $500 in large quantities, but the flagship products might not sell so much. This represents a great opportunity of personal care,” he added.
Sherry Lang, general manager of strategic partnership development at Alibaba Group, agreed, citing the example of the La Mer store on Tmall.
“La Mer doesn’t do discounts, and they are doing great,” she said.