A New Beauty Travel Retail Model Revealed at Beijing Airport

This post originally appeared on The Moodie Davitt Report, our content partner.

CDF-Sunrise Duty Free’s new eight-boutique luxury beauty concept, inaugurated at Beijing Capital International Airport Terminal 2 on May 16, offers a compelling template for other retailers and airports to adopt, according to the brand houses involved.

As revealed in The Moodie Davitt Report’s exclusive report yesterday, CDF-Sunrise Duty Free has partnered with eight brands – Clé de Peau Beauté; Dior; Estée Lauder; Guerlain; La Mer; La Prairie; Lancôme; and Sisley – to create a world-first beauty cluster at the Chinese capital’s gateway.

The beauty cluster at the Beijing Capital International Airport. Photo: Courtesy image

The beauty cluster at the Beijing Capital International Airport. Photo: Courtesy image

The boutique boulevard complements the mainstream perfumes & cosmetics offer nearby and allows dedicated focus behind key stock keeping units (SKUs) and a high degree of personalization, service and customer engagement in a series of refined environments.

“Beauty is what is driving the airport retail business worldwide, and yet it is poorly represented in terms of overall retail space,” one of the senior brand executives at yesterday’s launch told The Moodie Davitt Report.

“Many airports are giving insufficient space to beauty and too much to luxury fashion, which seriously underperforms by comparison,” said another. “This innovation by CDF-Sunrise shows what can be done. The retailer benefits, the airport benefits, the brands benefit and, most of all, the consumer benefits.”

The additional space has allowed the brands to express themselves in a manner rendered impossible by the constraints of a generic perfumes & cosmetics store. Each of the eight houses offers not only high-class boutique merchandising but an ability to engage with the consumer in a much more intimate and personalized fashion.

The Estée Lauder Companies Senior Vice President and General Manager, Business Operations Israel Assa summed up that view during his speech to guests at last night’s spectacular evening celebrations at The Four Seasons Hotel. “It is clear that CDF-Sunrise Duty Free and the Beijing Capital International Airport have the right attitude towards luxury beauty by dedicating free-standing store spaces that are the ultimate form of brand expression,” he said.

In some of the boutiques, the brand houses have chosen to focus on a single line, offering it only in the stand-alone store and not in the main shop. Others, such as Sisley, are only represented in the boutique format, eschewing the main store for the dedicated focus that the solo format allows.

Estée Lauder has embraced the boutique opportunity to present its first airport dedicated Re-Nutriv store – its first stand-alone concept for its popular luxury crème. Lancôme has chosen to focus solely on premium anti-aging skincare line Absolue (the brand’s first travel retail boutique worldwide); while Guerlain presents a beautifully curated selection of fragrances that underline the house’s 190-year history as a perfume maker. Dior showcases its micro-nutritive lotion Dior Prestige in a refined boutique setting. Sisley, La Mer, and Clé de Peau Beauté curate their ranges in elegant environments befitting of high-end skincare, color and fragrance products.

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Will Louis Vuitton’s ‘Dad Shoe’ Lawsuit Stomp Out Imitators?

Concerns surrounding intellectual property (IP) theft by Chinese companies is certainly not a priority exclusive to the Trump Administration. In early May, the French luxury powerhouse Louis Vuitton officially brought action against Belle International Holdings, a Hong Kong-listed Chinese footwear company, accusing it of infringing upon the design patent of its widely popular “dad” sneaker from its Archlight collection.

“This lawsuit deserves close attention because besides the fact that the dispute is between two established fashion groups, the dispute also focuses on a fashion article — the ‘dad’ sneaker — which has been trendy in the global fashion market,” says Sindy Ding-Voorhees, Associate attorney at Kilpatrick Townsend & Stockton and Co-director of the Fashion, Art, Media, Entertainment, Sports (FAMES) Law Institute in China.

The Archlight sneaker was first unveiled at Louis Vuitton’s Spring/Summer 2018 collection and officially hit the global retail market in February 2018. Upon its drop, the shoes immediately appealed to a list of high-profile fans, like the actor Jaden Smith, for its futuristic look and comfortable design. Retailing for approximately $1,090, the Archlight collection is perceived as a strong competitor to take the crown from Balenciaga’s Triple S sneaker (around $950), which arguably initiated the current “dad” sneaker fever in the fashion world.

According to legal documents obtained by South China Morning Post, Louis Vuitton filed the lawsuit to Hong Kong’s High Court against Belle International (China) and Best Able Footwear, which are two subsidiaries of Belle International Holdings, on May 3. The French brand noticed that Belle started manufacturing and selling a highly similar product to its “dad” sneaker since July 24, 2018. Therefore, Louis Vuitton requested the court stop Belle from further infringements and to order the company to remove and destroy all related items. The luxury brand further asked for an unspecified amount of compensation.

The copycat phenomenon is rampant in the global luxury fashion industry. It is a recurring issue that strikes many powerhouse brands that pride themselves on originality, craftsmanship, and top-notch design. The majority of luxury fashion designers tend to take to legal routes to protect their intellectual property rights, while some of them, such as Gucci’s Creative Designer Alessandro Michele, embraced the issue with a playful attitude, seeing copycat as a way of re-creating and even being creative. But the reality of the issue is more complex. Big-name brands often see themselves as the victim, but sometimes, it can be the other way around. For example, a Chinese fashion student studying at the Parsons School of Design accused the high fashion brand Viktor & Rolf of copying his designs for its 2017 Autumn/Winter Haute Couture collection in Paris.

On the legal side, copyright and design protection in fashion is an area where different countries and jurisdictions have varying legal standards, adding a layer of uncertainty to the future of Louis Vuitton case. “[The chance to win] will depend on any design rights or copyrights Louis Vuitton has registered [before the launch of Belle’s disputed sneakers], or unregistered, especially in China, where Belle’s main customers and market are located,” says Ding-Voorhees. “Another factor to Louis Vuitton’s success in this dispute would be its fame in China over its particular design of the Archlight shoes.”

The fact that Belle International Holdings is an established fashion player in the Chinese market also makes the case trickier. Founded by Tang Yiu in 1991, Belle International Holdings is China’s leading women’s footwear retailer, accounting for over 20 percent of the Chinese shoe market share. The company went public on the Hong Kong Stock Exchange in 2015. “Even if Louis Vuitton is able to claim protection of its design rights or copyrights in the Archlight shoes, either through direct registration or Berne Convention, the court would also listen to the other side of the story from Belle, for example, their rights, if any, their creation process, and the timeline of their launch, etc,” adds Ding-Voorhees.

The journey to protect copyright and design patent rights in China has mostly been tough, if not impossible, for international luxury brands. A previous success was the Italian skiwear brand Moncler, which, in 2013, won a case against a Beijing-based clothing company that produced similar winter parkas and copied its trademark. Moncler was compensated $430,000 for the losses.

Therefore, for brands doing business in China, being preventive rather than responsive to design infringements is more effective in avoiding similar problems coming back to them in the future. Ding-Voorhees suggests that before making a certain design of a fashion item public — particularly designs with distinctive features that will be available in global markets — brand owners such as Louis Vuitton should consider filing both broadly and swiftly for all available forms of IP protection.

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How the Met Gala Got More Than 170 Million Views in Less Than 48 Hours in China

This post originally appeared on Jing Travel, the Business of Chinese Cultural Tourism, our sister site. 

The Metropolitan Museum of Art (The Met) isn’t known for being a marketing innovator, but when it comes to capturing the attention of Chinese consumers, the storied institution is increasingly embracing unorthodox strategies. For this year’s Met Gala, an event that has never lacked for exposure, the museum decided to harness the vast power of the Chinese video-sharing app Douyin, aka TikTok outside of China, to the tune of 170 million views in 48 hours.

To make this happen, the Met partnered with Alfilo Brands (品源文华), a company specializing in developing inventive marketing and merchandising and retail programs for museums. And to capture “fashion’s biggest night out,” they launched a pair of Douyin campaigns to help draw the eyes of China to the Upper East Side. The first, “A Tribute to the Classics” (致敬经典), received 130 million plays in five days and the second, “Met Gala Wave” (Met Gala风潮), outdid expectations and dominated Douyin during the first weekend of May.

The feat was achieved by tasking 36 international KOLs (Key Opinion Leaders) and Douyin users to post their creative “Met Gala dress” short videos as if they were invited to walk on the red carpet. Douyin users were also encouraged to chime in with their takes on this year’s intriguing theme, “Camp: Notes on Fashion.”

A user’s post on the Met Douyin campaign. Photo: Jiemian

Simply put, the Douyin campaign was wildly successful because Alfilo Brands understood the Met Gala brand, the target Chinese audience, and perhaps most importantly, which channel to reach them. But according to Alfilo Brands CEO, He Yizan, in a recent interview with YiMagazine, the campaign nearly failed to materialize. “The management at the Met initially had concerns about this project, they didn’t know what Douyin was, and they were worried that the short video postings on Douyin wouldn’t fit with the museum’s character.”

As the exclusive licensee and retail partner of The Met in China, the Shanghai-based company is a well-established name within the industry. In fact, Alfilo Brands has fast become a specialist in developing Western museum brands for a Chinese audience with The British Museum, Victoria and Albert Museum, Museum of Fine Arts Boston, and London’s National Gallery already on their books.

For the Met, Yizan and his content development team, first set about organizing the entire program, coordinating the shooting-style with the content director (a former producer from trendsetting Hunan Television), and pairing it with based in New York and Shanghai. Then in March — six weeks before the event — he got the OK at a meeting with senior representatives of the New York museum.

Yet Alfilo’s Douyin success represents only the first stage in what promises to be a highly profitable relationship for the Met. Alfilo Brands specializes in monetizing the intellectual property of museums, and was behind the wildly popular British Museum Tmall shop, launched back in July 2018, and multiple brick and mortar stores in China. It created a range of unique products inspired by the museum’s collection specifically for the Chinese audience. Incredibly, retail sales of the British Museum licensed products in China are projected to hit $46m dollars by the end of 2019. “First have IP asset developed based on the museum’s collection, then monetization, and supported by high quality content,” explains Yizan. “Through content comes story telling and engagement with the young Chinese audience and the retail business creates hype and energy.”

Alfilo launched  the Met flagship store on Tmall in May 2019. You can bet that this world-famous institution will reap the financial benefits of pairing with a company that knows quite well how to monetize a museum’s brand for a Chinese audience.

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Sotheby’s x Jing Daily Conference Recap: Luxury on the Move

The future of luxury is a hot topic these days, and answers can seem hard to come by. Asking the right questions, such as, “How heritage brands can appeal to a new generation willing to drop a cool grand on a pair of sneakers?” or “What’s the value of traditional brick and mortar stores in an online, e-commerce, everything all the time digital world?” have become even more important. These topics and many more were tackled at the “The Future of Luxury II: New Pillars of eCommerce” conference on May 22, the second in an ongoing series of conferences co-hosted by Sotheby’s and Jing Daily.

The talk was held at Sotheby’s’ Upper East Side headquarters in a newly-renovated gallery/event space with double high ceilings, sweeping white walls, and pops of contemporary art — an inviting location to dig deep into the most pressing questions facing the trillion-dollar luxury industry. The large gathering of luxury professionals and brand strategists was eager to partake in spirited conversations about luxury storytelling, the luxury experience, and licensed collaborations with luxury brands. Here, some key takeaways from all three panels highlighting the most salient questions surrounding an industry that’s in flux.

Panel I: Defining Luxury Through Narrative, moderated by Simon Collins, CEO of WeDesign.org, joined by Josh Pullan, Deputy Managing Director, Global Jewellery & Watches at Sotheby’s, Laurence Lim Dally, Founder and Managing Director, Cherry Blossoms Marketing Research & Consulting, and Jacob Metzger, Co-Founder, Grailed, Freelance Brand Strategist. Photo: Ruonan Zheng

Panel I: Defining Luxury Through Narrative, moderated by Simon Collins, CEO of WeDesign.org, joined by Josh Pullan, Deputy Managing Director, Global Jewellery & Watches at Sotheby’s, Laurence Lim Dally, Founder and Managing Director, Cherry Blossoms Marketing Research & Consulting, and Jacob Metzger, Co-Founder, Grailed, Freelance Brand Strategist. Photo: Ruonan Zheng

Panel 1 — Defining Luxury Through Narrative    

Storytelling remains crucial for luxury brands hoping to project individuality in a highly competitive market.

“Stories matter, what has changed with new luxury is that it is about real stories.” —Laurence Lim Dally, Founder and Managing Director, Cherry Blossoms Marketing Research & Consulting

The future of luxury is truly about personalization and being treated special. Luxury is very commoditized and there are lots of brands and products that are similar, I think what makes something special is uniqueness and people are looking for that.” —Josh Pullan, Deputy Managing Director, Global Jewellery & Watches at Sotheby’s

“Especially in China, there has been the de-sanctification of luxury, everything that is Western is not prestigious anymore. There is a disruption about the concept itself of luxury — traditional luxury was about creating a world outside of the body — new luxury is about connecting people to themselves.” —Laurence Lim Dally, Founder and Managing Director, Cherry Blossoms Marketing Research & Consulting

Panel II: The New Landscape of Luxury, moderated by James Eron, Partner of Kung Fu Data, joined by Charlie Gu, Founder of Kollective Influence, Noah Wunsch, Senior Vice-President, Global Head of eCommerce, Sotheby’s, Emma Chiu, Creative Innovation Director, Wunderman Thompson Intelligence, and Michael Rock, Founder of 2x4. Photo: Ruonan Zheng

Panel II: The New Landscape of Luxury, moderated by James Eron, Partner of Kung Fu Data, joined by Charlie Gu, Founder of Kollective Influence, Noah Wunsch, Senior Vice-President, Global Head of eCommerce, Sotheby’s, Emma Chiu, Creative Innovation Director, Wunderman Thompson Intelligence, and Michael Rock, Founder of 2×4. Photo: Ruonan Zheng

Panel 2 — The New Landscape of Luxury

The key for luxury brands is to create a symbiotic relationship between online and offline platforms.

“Create a seamless way of speaking [to consumers], online, offline, it should just be transcendent.” —Emma Chiu, Creative Innovation Director, Wunderman Thompson Intelligence

“What we are starting to see in e-commerce is a move to minimalism, in what is being labeled rightly or wrongly, the Instagram aesthetic. Increasingly, the UI & UX [User Experience Design and User Interface Design] is incredibly simple.” —Noah Wunsch, Senior Vice-President, Global Head of eCommerce, Sotheby’s

Panel III: Licensed Collaborations with Western Luxury Brands, moderated by Steven Ekstract, Brand Director, UBM’s Global Licensing Group, joined by David Stark, Founder and President, Artestar and Adina Avery-Grossman, partner, Brandgenuity. Photo: Ruonan Zheng

Panel III: Licensed Collaborations with Western Luxury Brands, moderated by Steven Ekstract, Brand Director, UBM’s Global Licensing Group, joined by David Stark, Founder and President, Artestar and Adina Avery-Grossman, partner, Brandgenuity. Photo: Ruonan Zheng

Panel 3 — Licensed Collaborations with Western Luxury Brands

Twenty years ago, licensed collaborations were a rarity; today they offer a myriad of opportunities for luxury brands to express themselves.

“Europe was a big market for us 20 years ago, the U.S. has grown a great deal. [Now] everything is in China…. We have done three campaigns with them [Coach x Keith Haring] first campaign was an outlet campaign, first three months 30 million dollars in retail sales, 70 percent, 80 percent of the sales [were in] China.” —David Stark, Founder and President, Artestar.

“Great brands see licensing as a part of their marketing mix…  it’s not just about the product you make, if [liking] the brand is an emotional connection, if the brand is a relationship with the consumer, how far can that relationship go?” —Adina Avery-Grossman, Managing Director at Brandgenuity

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What the ‘BrandZ Top 100’ Tells Us About China’s Luxury Market

This year’s BrandZ Top 100 Most Valuable Chinese Brands report saw Alibaba leapfrog Tencent for the title of China’s most valuable brand, and more importantly, the combined brand value of the Top 100 grew over the year by a healthy 30 percent to $889.7 billion.

Commissioned by WPP, a creative transformation company, and based on research carried out by London-based consultancy Kantar, the BrandZ Top 100 Most Valuable Chinese Brands ranks the estimated “brand value” of 100 prominent Chinese companies. The report is based on data from Bloomberg and insights from over 3.7 million consumers worldwide. That figure includes almost 290,000 Chinese consumers who are surveyed on more than 1,100 brands across 75 categories. Kantar then narrows the field down to the Top 100, with 24 industry categories represented in the final cut.

Alibaba claimed the top spot for the first time since joining the BrandZ Top 100 in 2015, ending Tencent’s four-year run at the top, with its brand value increasing by 59 percent year-on-year to arrive at a total of $141 billion. In contrast, Tencent only grew year-on-year by 4 percent. It’s worth noting that the combined $279.1 billion brand value of these two companies alone account for more than 30 percent of the total value of the entire BrandZ Top 100.

The BrandZ Top 100 employs a range of metrics to evaluate brand value. For example, the authors pointed to Alibaba’s performance in the “Brand Power” metric, and particularly the perception among consumers that Alibaba’s brand was “meaningful.” They suggested that the e-commerce giant’s success in pioneering the “New Retail” concept had helped deepen consumers’ connection to the brand, resulting in Alibaba’s 59 percent increase in brand value.

If Alibaba surpassing Tencent is a mark of the success of the e-commerce giant’s “New Retail” initiative, JD.com’s tenth-place finish further underlines the significance of online retail in China today. Although it didn’t make the list, cross-border e-commerce platform Netease Kaola, which helps consumers purchase international brands, was cited by the authors as one of an emerging crop of services clamoring for market share in that field. In addition to the e-commerce and New Retail powerhouses, innovative companies in the artificial intelligence and social media fields also showed impressive results.

As in previous years, there are valuable takeaways from the list-climbing fortunes of high-end brands of baijiu, a type of Chinese grain liquor. The BrandZ Top 100 authors noted that many baijiu companies have invested in brand upgrades to engage affluent younger consumers — modern packaging, festival tie-ins, and new flavor variants (Moutai, for example, launched a new chocolate liqueur.) The BrandZ Top 100 results show impressive outcomes for baijiu producers, with five of them ranking among the 20 brands with the largest year-on-year growth: Wu Liang Ye, Moutai, Yanghe, National Cellar 173, and Gujing Gongjiu. Moutai also rose to fifth overall on Top 100 from seventh place in 2018, with 58 percent year-on-year growth.

Other brands in luxury consumer categories didn’t fare as well, with skincare/healthcare brand Yunnan Baiyao suffering a 20 percent dip in value year-on-year despite diversifying its offerings to attract more millennial consumers. Shanghai’s time-honored (“lao zi hao”) jewelry brand Lao Feng Xiang barely clung to its Top 100 status dropped to 98th place after a 15 percent drop in brand value over 2018, while another jewelry brand dropped off the list entirely. The report blamed these trends on a dip in discretionary spending as a result of the US-China trade war and slowing domestic economic growth.

This year is the first time the BrandZ Top 100 has included “unicorn” companies (startups that have a valuation of over $1 billion based on their most recent public valuations, but are not publicly traded, including smartphone maker Xiaomi and Uber-like ride-sharing app DiDi), allowing the publishers to present a fuller picture of the key players in contemporary Chinese commerce. Seventeen brands made their debut on the list, with four industry categories represented for the first time: consumer finance, entertainment, lifestyle platforms, and transport.

Marketers should pay particular attention to how they can collaborate with powerful brands in the entertainment and lifestyle platform categories. The lifestyle platform category, which includes brands like Meituan, Ele.me, and Dianping, is both new to the BrandZ Top 100 and Kantar’s China report, where authors describe the category as “a uniquely Chinese phenomenon—the radical integration of online platforms and offline capabilities (O2O) to provide products and services with extreme consumer convenience … Only in China do hundreds of millions of people, especially in major urban centers, conduct their daily lives, generally without cash, using only one or two apps to order and pay for almost any product or service they need.”

The entertainment category enjoyed a 186 percent increase in combined brand value — by the largest growth of a single category by a large distance. Video streaming services iQiyi and Youku enjoyed the largest individual year-on-year growth of brand value at 158 percent and 136 percent, respectively. Of the 24 industry categories represented in the top 100, 13 saw an overall increase in value. Technology was the most-represented category, with 11 brands in the top 100 representing 26 percent of the top 100’s total dollar value.

The combined growth in the Top 100’s brand value was the largest annual increase in value since the BrandZ Top 100 was established in 2011. Against the backdrop of an economic slowdown and trade tensions, most notably with the United States, the record 30 percent surge may seem surprising. However, the authors said brands have enjoyed opportunities for unprecedented growth and expansion because of the emergence of consumer spending power in China’s lower-tier markets. Another factor boosting brand value is enthusiasm for Chinese consumer brands that are establishing reputations and clout outside China.

“The threshold to enter the BrandZ China Top 100 has more than doubled from $311 million in 2018 to $681 million in 2019, demonstrating the continued pace of growth for Chinese brands increasingly recognized as leading the way in innovation,” David Roth of WPP said in a statement. “Against a backdrop of heightened competition and disruption, building stronger brands is what it takes to stay in the game.”

BrandZ offers five key takeaways for brands aiming to strengthen their brands in the year ahead. The authors urge brands to “build difference,” stressing the importance of distinguishing themselves from the pack as the Chinese market becomes increasingly crowded and competitive.

One aspect of that is to “refine the brand experience,” meaning brands need to look for opportunities to personalize their products and services to deliver more memorable experiences. With so much growth happening in lower-tier cities, “going deep” means investing in understanding the specific conditions in different regions and cities, as brands can no longer afford to rely just on experiences gained in the major metropolises.

The authors also suggest that brands need to “be intelligent” by integrating both human and artificial intelligence to provide maximum convenience to consumers who value ease of experience above all else. And finally, they advise to “build a powerful brand” by focusing on how the consumer interacts with your brand at the point of sale. Whether a brand’s business is online or brick and mortar, powerful brands will stand out and attract consumers to complete their purchase.

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Rimowa Takes on China with a Mix of Heritage and Hip

In October 2016, LVMH acquired a majority stake in the German high-end luggage brand Rimowa, while also appointing Alexandre Arnault as its co-chief executive. The youngest scion of magnate Bernard Arnault, Alexandre has proceeded to transform the suitcase company by blending heritage and exclusivity with modern design elements, as well as collaborations with high-profile brands like Supreme, Off-White, and Fendi. Young, cool customers were soon Rimowa aficionados, which helped propel the company to new heights and built them a cult following. Today, Alexandre is seen as the force behind the Rimowa’s resurrection. Jing Daily spoke with him about what’s next for the brand, including Rimowa’s retail plan for China and much more.

How does Rimowa balance their core business with new collaborations that help create excitement?

We view collaborations as a platform for us to express ourselves, and for our partners (brands, celebrities, artists) to use our suitcases to tell the world their perception of travel. It is a very important part of our core business, not only to create a buzz, but also as a revenue driver. And obviously, it increases the awareness of the brand, which drives more traffic to stores and general interest.

Rimowa’s collaborations with Supreme and Off-White were beloved by younger consumers in China, but how can you expand your business to also reach “mature” consumers?

We have never made initiatives only with the goal of targeting specific demographics. While younger consumers applauded some of our collaborations, we believe different consumers were also attracted. Moreover, in everything we do with our core range, we try to focus as much as we can on the superior functionality of our products.

Your Fendi x Rimowa collaboration was a big hit in China because of social media campaigns like the one you did on WeChat, but do you think there’s a risk of overexposure when employing social media channels?

There is always a risk of overexposure. However, I think in the world we live in today, an online presence is key in order to stay relevant in the eyes and minds of all types of customers. Inclusivity is key in the stories of many brands today, not only in fashion but also in lifestyle, technology, etc. That inclusivity exists thanks to social media, which have given us an unprecedented tool to communicate to our customers.

Courtesy photo of Rimowa

Photo: Courtesy of Rimowa

China is a country that has seen a huge surge in tourism activities, and luxury travel bags are in high demand. But there’s also competition from less pricey direct-to-consumer luggage startups like Away and Roam. What’s your strategy to pull ahead of competitors?

I find it exciting that these companies exist as they shine a light on our space [in the market]. A few years ago, nothing was exciting about buying luggage. Now it is slowly becoming appealing! At Rimowa, we feel that by continuing to invest in our factories where we manufacture all our products and in the engineering of our luggage, the market will recognize our quality, thus allowing us to remain leaders in the space.

In 2016, the court in Zhongshan, China acknowledged that the “groove design” was a unique feature of the Rimowa suitcase and therefore falls under protection from counterfeiters. Yet despite its protectable status, new companies constantly infringe on the design law and produce copycats. How do you combat the online purchase of counterfeit products?

It is a very tricky topic, and the entire LVMH Group is very active in combating counterfeit products. We work in conjunction with governments and Internet platforms in order to avoid it as much as possible.

Rimowa will focus on key locations for the luxury market in tier 1 and tier 2 cities in China, as well as online distribution. Courtesy photo

Rimowa will focus on key locations for the luxury market in tier 1 and tier 2 cities in China, as well as online distribution. Photo: Courtesy of Rimowa

You said that you’d like Rimowa to be a “culturally relevant brand in the space of travel, hopefully not only selling suitcases but other travel-related products.” What other products and services have you envisioned for Rimowa?

The first category of products to arrive is bags (backpacks, weekend bags, etc.), which make complete sense for Rimowa as travel gear. We are also playing around with the ideas of developing interesting services linked to hotels, flights, etc., but haven’t cracked the equation just yet.

What are your plans for China in the near future?

We took over 55 stores back from our local partners just a few weeks ago. The immediate plans are to correctly size the distribution and expand the company in areas that are more in line with our current positioning so our brand can appear in locations that are more aligned with our strategy. We will focus on key locations for the luxury market in tier 1 and tier 2 cities, as well as online distribution. We are also investing significantly online.

Is Rimowa doing any Chinese-specific products?

We are not planning to do so for the moment. As we are a global brand, we try to be inclusive of every country, and our strategy is balanced across the world.

Is the heritage of Rimowa important to Chinese consumers?

Yes, it is key. Heritage, craftsmanship, and general quality of our products are, I believe, what makes our brand successful with Chinese customers.

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What You Need To Know

Content is no longer king on WeChat. As WeChat evolves, and more content creators join the platform, users are becoming more and more selective on what they read. Since November 2015, the “open rate” on WeChat articles has decreased from an already low 17 percent to 6 percent, according to data gathered by social media management platform KAWO. In our previous interviews with WeChat users, they’ve often complained: “It’s hard to search for content on WeChat.” or “Instead of reading long-form articles on WeChat, people spend more time watching videos.” Given the ever-changing habits of users, it’s inevitable for brands to adjust their strategy as needed — instead of using WeChat as a broadcasting tool to raise mass awareness, brands are now positioning it more as a one-on-one service tool.

And many have done so already. We saw YSL Beauty build an Instagram-like sharing Mini Program, Dior sells e-gift cards, and Maybelline launch a customer service program on their WeChat account, etc. Through each, brands are not only offering some form of service, but more importantly, gaining valuable insights about their subscribers through social Customer Relationship Management (sCRM). Shanghai-based digital agency firm 31Ten recently published a report offering brands a hands-on guide on how to best navigate sCRM. Here’s a brief summation:

On WeChat, how much data a brand can collect about their subscribers is quite limited. In fact, the only thing that’s visible is the user’s name (which most cases are not their real names) and sometimes their location. This can be frustrating for brands, not knowing who is following their WeChat feed, and a missed opportunity to convert them into potential customers.

With sCRM, the system tracks each subscriber with a unique ID, and monitors each and every interaction with the brand.

The above screenshot from the American retailer Coach is an example of basic sCRM. Every customer who subscribes to the account will be greeted with a welcome message asking them to bind their WeChat account with their name phone number, and gender to become a member. In other cases, brands can also use the chatbox to fulfill this goal (see below).

Once this information has been collected, brands can send tailored messages by gender, location, and even their relationship status. For example, the German fashion brand MCM utilized the power of sCRM for their pop-up shop in China. To identify the subscribers who might be interested in attending, the brand looked at their user’s WeChat activities — clicks on articles from official WeChat accounts, their activity on Mini Programs, as well as transactions on WeChat e-commerce. After the event, MCM targeted its VIP customers that had attended the pop-up, and invited them to a “VVIP” event, where they could enjoy an enhanced coffee-making experience. The result of this multi-layered, targeted campaign, which brought followers from online to offline, was a deeper relationship with them — far beyond the digital world of WeChat.

Although the process looks straightforward, in practice, there can be many hurdles. “The challenge of sCRM is to come up with a unique digital strategy that translates the brand, its values, and personality into a data-driven engagement: a signature customer experience,” says Vlad Alukhanov, a WeChat and CRM brand strategy consultant. “For most brands, an off-the-shelf solution simply won’t do the job.” So luxury brands who wish to control and preserve their brand equity, assigning an in-house person might be more helpful than outsourcing it to an agency (the report discussed the pros and cons of both).

Additionally, Thomas Portolano, digital lead Asia Pacific at Christie’s warns brand to do some serious soul searching before diving all in. “How does WeChat make a difference for your business? If you’re not sure, segmenting users and delivering personalization isn’t going to make a business.”

sCRM or not, for any brand wishing to add WeChat into their digital strategy in China, the benchmark has clearly changed — from page views and click rates to the quality of interactions with each subscriber, because regardless of the platform they are on, the goal is always to know your customers.

Read more on about a list of recommended sCRM agencies on the report from our latest WeChat newsletter — a weekly briefing on all things WeChat, featuring the latest news, campaigns, reports, case studies & events.

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Cai Xukun Remains the Top Celebrities in China in April: R3

Following the launch of the first edition of the R3 Celebrity Index — a monthly ranking of China’s most influential celebrities on the country’s most important social media platforms, from Weibo and WeChat to Toutiao and Baidu — Jing Daily and the global consultancy is co-releasing the April list:

April R3 Celebrity Index. Photo: Courtesy image

April R3 Celebrity Index. Photo: Courtesy of R3

Chinese boyband member Cai Xukun continued to be the most buzzed-about star on social media due to his ongoing legal disputes with a video company. On April 12, Cai sued Chinese video-streaming site Bilibili, a platform that embraces user-generated video content, for the violation of his personal rights. Last year, Cai shot an official video playing basketball when he was named as the brand ambassador of the NBA League in China. His basketball skills, however, were seriously scolded by Chinese people, which led many online users to re-edit the NBA video to make jokes about him. The lawsuit helped amass public interest. By surrounding himself with a lot of negative sentiment, Cai is a typical example of a Chinese celebrity whose name is well-known but for all the wrong reasons. Luxury brands need to be extremely cautious about working with him by fully assessing the benefits and drawbacks of the collaboration before pushing the “go” button.

Actress and fashion queen Yang Mi. Photo: VCG

Actress and fashion queen Yang Mi. Photo: VCG

Yang Mi, China’s fashion queen and the face of brands like Michael Kors, Stuart Weitzman, and Estee Lauder, came in as the second-most popular star this month. Her popularity was primarily driven by the launch of her first variety show, “The Escape of the Chamber,” which drew the attention of both her fans and the general public. Deng Lun, a popular idol among millennials who ranked No. 6 on the list, has also joined the show.

The third-most popular celebrity, Zhao Liying, also climbed up the ranking due to controversies. Her fans were in a fierce Weibo spat with the fans of another actress Liu Shishi over who was more popular. It generated a lot of comments, which brought her a a great deal of exposure. During the same month, Zhao also fired her agent, Huang Bing, who brought her fashion connection to brands such as Christian Dior, which made online users speculate about their relationship.

Actress Zhao Liying climbed up the ranking due to controversies in April. Photo: VCG

Actress Zhao Liying climbed up the ranking due to controversies in April. Photo: VCG

Deliraba, who ranked 7th, used to be the brand ambassador for Dolce & Gabbana but resigned from the role immediately after the brand’s video disaster last year. The past month, she was publicly dressed by luxury brands like Stella McCartney. Jackson Yee (No. 10), the brand ambassador for Bottega Veneta; Lay Zhang (No. 12), the brand ambassador for Valentino; and Angelababy (No. 18), the brand ambassador for Christian Dior, maintained a high level of popularity on social media, which can be utilized by brands.

In China, the power of celebrities is driving brand engagement with consumers. When Italian luxury brand Gucci recently released a dedicated WeChat post to document the three-day Italian journey of its Chinese brand ambassador, the actress Ni Ni, the post quickly received over 100,000 page views and was liked by 639 people with a great number of users praising the Gucci outfits worn by Ni and the compatibility of the brand and the celebrity. Louis Vuitton’s latest collaboration with its Chinese ambassador Kris Wu, who was ranked No. 13 on the list, to unveil its next-generation Horizon Soft travel case, also sparked positive consumer sentiment. The post on Weibo that featured Wu’s campaign video garnered over 13,000 comments and more than one million re-shares.

In both Gucci and Louis Vuitton’s cases, choosing the right celebrities and forming a long-lasting, authentic relationship with them has proved to be very important in growing awareness, popularity, and a positive image for luxury brands in the Chinese market. But it is not an easy task. The difficulty is always in how a luxury brand can pick out a celebrity that fits its image and whether it can form a lasting business relationship with them.


The following ranking of 20 top celebrity influencers in March is calculated using data from Weibo’s Fan Base (calculating Activity, Adorable, and Social Influence Indexes), Toutiao, Baidu, and WeChat.

Weibo assumes the most weight, as it’s the platform where fan engagement can be traced. The Baidu, Toutiao, and Wechat indexes are more based on search behavior. The data from Weibo helps indicate the commercial value for each celebrity, especially for the Adorable index where fans actually use a pay function to express their admiration for a celebrity.

  • Activity Index: The Activity Index counts the number of interactions on Weibo, which is a statistical indicator of interactions (including forwarding, commenting, likes, replying to comments, and comment likes on Weibo) generated by the content posted by the star over the past 30 days (including posts, comments).
  • Adorable Index: This refers to the contribution of fans to the celebrity. Weibo has a mechanism where fans can contribute their admiration to the celebrity by giving virtual flowers which aren’t free. The adorable index is generated from the number of flowers the celebrity receives monthly.
  • Social Influence Index: There’s a large number of users publishing microblogs daily that mention celebrities. These microblogs are read by other users, and the number of readings reflects the recent popularity of a celebrity. In addition, a large number of users search for celebrities on Weibo every day, and the search volume generated also reflects the recent popularity of those celebrities. This data adds up to the social influence index of the celebrity.

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Tiffany’s Adapts to China’s Green Demands

“We are seeing a new generation of consumers… that cares more than ever about the social and environmental impact of the purchase,” says Anisa Kamadoli Costa, Chief Sustainability Officer at Tiffany & Co. and Chairman of the Tiffany & Co Foundation. “It is only natural that in the case of luxury jewelry, people want to know where their most precious items have originated from.”

This was the message Costa put forth at a panel during the 3rd Annual SupChina Women’s Conference on May 21, where she highlighted her company’s commitment to sustainability. One aspect of this assurance is Tiffany’s Diamond Source Initiative: a diamond provenance policy launched in January of 2019 that seeks to satisfy the heightened demands for transparency and sustainability in luxury — factors that are increasingly important for the Chinese market.

“Now, you can walk into a store in Beijing or New York and we will be able to tell you the provenance of that diamond,” she explains. “Looking at the Chinese consumer, I remember 10 or 15 years ago people would make the assumption that the Chinese consumer didn’t care [about sustainability] and that is simply not the case anymore.”

In China, this shifting focus towards sustainability is being driven by both government policy and consumer demands. The 13thFive-Year Plan put forward by the People’s National Assembly of China highlighted the importance of growing domestic consumption sustainability, and a JD.com study in late 2018 noted a 71 percent increase in spending on green products in China.

“We are seeing the Chinese consumer cares more and more about the sustainability of the products they are purchasing, such as jewelry, and that is huge,” says Costa. “The Chinese consumer [power] has a huge part to play. They can decide to purchase something or [decide] to not purchase from a specific company. I am excited about what we are seeing in China.”

China’s dominant purchasing power in the luxury market is set to hit 65 percent of global consumption by 2025 according to McKinsey’s 2019 China Luxury Report, and when twinned with the environmental concerns of affluent consumers, this will make projections of sustainability from luxury brands increasingly important in the country.

Unlike many luxury brands, Tiffany & Co. enjoyed a strong 2018, reaching net sales of $4.4 billion (a company record) that was driven in part by its robust presence in the Asia-Pacific (including China) with total net sales increasing 13 percent to $1.2 billion.

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