China’s Weak July Could Spell Trouble For Luxury Brands

What Happened: The National Bureau of Statistics of China announced in a statement that the country’s total retail sales of consumer goods during July reached $4.64 million (3.22 billion yuan). It was a year-on-year decrease of 1.1 percent but a rise from 1.8 percent in June.

Garments, footwear, and knitwear all saw a disappointing drop of 2.5 percent. Yet jewelry, which is categorized alongside gold and silver, was up by 7.5 percent, and cosmetics, which have been surprisingly popular during the COVID-19 outbreak, continued to soar, climbing 9.2 percent year-on-year.

The Jing Take: Measuring retail sales is the most reliable indicator of consumer spending and the best barometer of overall economic activity. After a steep slump at the start of 2020, China became the first economy to recover from the global pandemic, giving hope to many other countries that are still battling economic uncertainty. Worryingly, these latest figures have come in lower than what was generally predicted by analysts and China-watchers.

Yet, it is still a month on month increase and only incrementally under forecast, which should offer hope. Moreover, this continued slump begs the question: Will Beijing implement an additional economic stimulus to boost and promote domestic spending? And, if so, how will it impact international brands selling in China? If the domestic C-beauty battlefield is any indicator, Chinese spending should be even harder for global luxury brands to win going forward.

The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

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Here Is The Only Good Pricing Strategy For Luxury Brands

Over the past few months, almost every brand I’ve advised said that pricing was a major challenge for them. To me, this isn’t a surprise. When business is booming, companies become more confident about pricing. But when markets contract and sales fall, there’s one primary reflex: to discount with the hope of luring back customers.

Pricing is incredibly important for luxury businesses because many of them destroy significant brand equity when they lower prices in search of fast, easy growth. The consequences are almost always fatal. Driving down prices changes a brand’s value perception, which reduces that brand’s actual value. And when brand equity erodes, a rude awakening awaits. During the current pandemic, some brands that were active in discounting, such as Burberry and Ralph Lauren, only compounded their existing issues.

When you look at the brands that are suffering most in the pandemic, there is a pattern: They are poorly differentiated brands with weak brand storytelling that price themselves in the middle of the pack. In the luxury market, I’ve never found an example where an undifferentiated luxury brand achieved sustainable revenue and profit growth by discounting, which begs the question: Why are so many brands falling into this trap and gambling away their futures?

When I do postmortem analyses on failed brand strategies, I see another recurring pattern: They almost always overestimate their brand equity and underestimate how pricing moves are perceived. Let me explain.

Within every brand team, there’s usually the perception that consumers know every detail about the brand. That’s because brand teams spend day and night solely working on their brand. The internal teams know and love everything about the brand, which creates the false impression that the external view on the brand is as positive as the internal view. So in the mind of brand managers, their brand appears to be much stronger than it is.

This phenomenon is called marketing myopia — a nearsighted focus when selling products and services, instead of putting sufficient emphasis on what consumers truly want and how to create customer value over the long term. It was first described by Harvard Business School professor Theodore Levitt in 1960 and became one of the most famous concepts in marketing science.

Yet, marketing myopia persists, and the luxury marketing strategy training that many luxury executives lack tends to compound this behavior within the industry. Avoiding marketing myopia calls for much more training and greater precision in executing these strategies, which allows brands to balance their short term and long term. Because of this reality, the demand for luxury masterclasses has never been as high as it is now.

Brands’ second error is to underestimate pricing effects. Research on competitive market signaling has shown that actively changing prices creates the single greatest competitive signaling effect, with some comparing it to a nuclear bomb. Changing a price always has a short-term lift effect, but the long-term fallout is almost always catastrophic.

If a luxury brand was able to sell a specific item at full price to hundreds of their best and most loyal customers, but then — due to a crisis or slow period — decided to detonate an atomic price drop, all they’ve done is reward a group of one-time, price-sensitive, non-loyal customers. They trade in their brand equity, which their best customers built by paying full price, for short-term, easy growth. And then, any loyal, full-price customer of the brand who sees items they once bought become significantly discounted is sure to be alienated. Nothing makes loyal customers leave faster than deep discounts.

When we interview managers about why they changed prices, the answers are usually versions of: “we didn’t expect the negative pricing effect to be that bad” or “once the brand is more established, we will promote less often.” Sadly, the odds of a brand becoming stronger after it discounts its products are close to zero.

So what is the right pricing strategy? The right approach is to take a step back and remember why consumers ever paid a premium for the brand in the first place. The answer is simple: You would only pay a premium if you got more value compared to another alternative. For luxury brands, only a fraction of the total value is provided by the product. Other factors, mostly intangible and hidden ones, drive values dramatically higher. The magnitude of this “Added Luxury Value” (ALV) can be mind-blowing. We found categories in which the top-tier brands generated ten-thousand times more value than brands in the same categories that only provided functional value.

Most managers never calculate ALV. So, intuitively, they believe that ALV is a relatively small part of the brand’s equity, which they assume is mainly driven by the product or service. Consequently, they think a discount promotion won’t have much impact on their brand’s perceived value. But think again! If the largest part of any perceived value is driven by intangibles, then discounting a luxury item is directly destroying ALV. And rebuilding an intangible once it’s destroyed is nearly impossible.

Pricing, therefore, first has to start with building an extreme value creation model. Brand executives have to generate clarity about what exactly they’re selling. What is driving ALV for their brand? Why should a customer consider them? What is the competitive advantage — not thanks to the product but because of the brand positioning? Brands must look at the big picture where the customer at the center.

Only when the value model is crystal clear and rigorously defined can a brand can price correctly. If the price is too low, it signals that there’s less value. So, next time your brand has to decide whether or not to discount, think differently. Instead of lowering prices, first, think about how you could excite your customers more. Then think about the extreme value your business creates. Only these steps will allow you to price your luxury brand as precisely as possible.

Daniel Langer is CEO of the luxury, lifestyle and consumer brand strategy firm Équité, and the professor of luxury strategy and extreme value creation at Pepperdine University in Malibu, California. He consults some of the leading luxury brands in the world, is the author of several luxury management books, a global keynote speaker, and holds luxury masterclasses in Europe, the USA, and Asia. Follow @drlanger

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How Mia Lei’s Niche Luxury Equestrian Brand, Mia Suki, Cropped Up At The Right Time

Speaking on the phone from Austria, Mia S. Lei comes off as charming yet determined. As the founder of Mia Suki, a brand pioneering the niche market of luxury equestrian sportswear, Lei is as passionate about her unique industry as she is about empowering Asian female voices. As an outspoken entrepreneur from Mainland China herself, she’s certainly seen her share of challenges.

Lei was born in Guangzhou to a military family during the 1980s, where her self-made grandfather was a notable figure, casting a long shadow over the family by pledging himself to a new vision of China. She cites him when discussing her determination and desire to make positive changes, and his writings are now used as a modern literature companion in Guangdong Province schools.

When Lei left China to study in Europe, she witnessed major generational changes which, in hindsight, have shaped her current outlook. “It was very different, of course, but we still understood the restrictions [placed] on generations before us,” she said. “My peers and I believe in change. Many things might not change, but I believe in it because growth has to happen.”

This transformation can be seen in the rapid development of China’s tourism, recreation, and sports sectors, which have provided opportunities for China’s equine industries. Lei, who took up horseback riding to combat an early fear of animals, attempted early on to capitalize on this burgeoning market.

 The 2020 Equestrian Apparel Market Report states that the global equestrian apparel market is currently valued at $2551.3 million this year. And even though growth over the next six years should be slow, China’s growing purchasing power and future market potential should make the country a priority for producers. In 2019, China’s equestrian HNWI population equaled 1,195,100 riders, an increase of 9.8 percent over 2018.

With equestrian events and activities steadily increasing in China, Mia Suki has anticipated the growing demand for fashionable luxury equestrian performance wear, which comes with built-in consumer loyalty. Moreover, her garments can easily transition from sportswear to elegant casual wear. Jing Daily spoke to the entrepreneur about being a Chinese businesswoman and the importance of running a sustainable brand.

How have you spent your lockdown?

I’m currently in Austria, where I live. My husband is Austrian, and we’ve been here since Chinese New Year. I am blessed that [Austria] has handled COVID-19 well. We have two young children, and they love it here, but we haven’t been back to our home in Hong Kong for a while, and we miss all my family.

But at the same time, I enjoy working from home in Austria because it is different.  We are in Graz, where my husband is from, and while he’s been an ex-pat in Asia, we need our children to know both their parents’ roots and understand the culture, so we travel between when we can.

What’s your background, and what drew you to fashion initially? 

My father is a businessman in real estate, I‘m the eldest of three girls, so I was under great family pressure. Fashion is a tough business, and it’s not the preferred choice for families in China. But I really enjoyed my freedom and getting to know myself in a safe environment [in boarding school in the UK]. Perhaps I wouldn’t have had the freedom in Kong Hong to choose my career, so I always appreciated being sent away.

I studied business management at King’s College, and from there, I started a master’s in fashion entrepreneurship and innovation at the London College of Fashion. When [my parents] saw I wanted to do the course, they weren’t happy. But I felt it was something I wanted to do. Yet I never finished it because of an eating disorder, and I’m proud to speak about that, as I want to bring awareness to these things. Psychological health isn’t a subject that’s brought up in Asia like it is in the West, so it’s important.

Speaking of which, what are some of the difficulties you face as a female entrepreneur in China? 

Female empowerment has been topical for a long time, but Asian women tend not to speak up because, in Asian culture, certain things are dealt with in private. It’s not that we don’t want to speak up about things like racism, but we deal with it with silence. For us to speak up about some issues would be culturally and behaviorally different. That’s why I think it takes even more courage for us to be outspoken. But, I think it’s time for women, particularly ethnic women, to put a stop to certain things.

From a business perspective, trademarks are very different in mainland China, and though the country is advanced in so many ways, some profiteers are very powerful and know the loopholes. I’m a worldwide trademark, and I’ve had issues with mainland China trademark agencies when it comes to classing and filing motions in court — it’s a long process. I do not believe in spending cheaply for legal, and my IP and trademarks have all been handled in Milan by trademark specialists.

Could you tell Jing Daily about your brand and your perspective on the fashion industry? 

My vision for the brand from the beginning was to have the most technically amazing and comfortable equestrian brand for women. I like to say I offer an intelligent product as there is so much thought behind it; I am not pushing a product out there that the world doesn’t need. It’s about comfort and confidence, and holding/molding you in a certain way — it should add value to your posture. It’s got to be a performance product but crafted beautifully. And it can look sporty, but it’s not athleisure — it’s more than that. It’s not a casual product.

Fashion is something that fascinates me. I believe in quality and having strong values, meaning that we buy certain things so we can pass them on — along with the stories that come with them. I need to push my creativity and my ability to produce something this high-quality, and that’s very important for me, particularly as a mainland Chinese woman. Chinese fashion is an area people should watch out for, and I believe many mainland luxury brands will start to emerge soon.

What’s your brand strategy and are you selling in China yet?

I’m a destination brand. Since I’m so niche, I rely on organic traffic and word of mouth. I need to position my brand in Europe correctly before bringing it to China, which I know will be a big market in time. In the UK, Harrods picked up the brand in 2016 and has been an amazing support. At my brand positioning level, Harrods is the best fit. One of my ambassadors is the Queen’s second cousin, and I have a strong relationship with royalty.

We started selling in China offline last year at equestrian tack shops at prestigious equestrian clubs, but I’m still formulating my online business. Tmall is very expensive to start with, and it’s a bit premature to do a lot of online marketing for an equestrian brand in China, as the sport isn’t at the same level of engagement [as Europe] at the moment.

Consumers [in China] want to spend on luxury, but when it’s a sporting product, they ask themselves, ‘do I want to spend that much?’ I was told when I launched that I was too advanced, and [riding] was a luxury sport. But, some products like my riding helmets have been selling a lot in China. I work with Kep Italia because, structurally, they are better for Chinese head shapes.

Can you tell us about your daily operation and how you source your products? 

In terms of operations, I have a team, and I work closely with them to choose our fabrics and figure out how to construct products. I only buy from certain, very technical, specialized, high-end Italian manufacturers, and I always look at their sustainability policies before I purchase.

Unfortunately, we still do new production, but I would love to work with other companies like Redress [a Hong Kong-based environmental NGO] to look at minimizing fashion waste. But I make a product that lasts, which is already a step forward. By making better products, [consumers] will wear them more often, and I always look at it from a consumer point of view, or as a mother. I need things to be practical things that perform, like unfailing tailoring. But I love my converse [sneakers] when I’m running around all day picking up kids, so I need things to translate and travel, too.

Having mentioned the environmental balance, has this outbreak impacted your future business plans? 

Well, all businesses want to sell new things, but it’s hurting the environment. I want my children to have nature and all the things I have enjoyed, so we need to be doing more [for the environment]. I’m a second-hand consumer, and I embrace the circular economy. In leather, for example, I will be incorporating the circular economy into my online business. I want to adopt this with a new phase, such as reselling pre-owned Mia Suki garments. In the future, I’ll also look to invest in fashion tech and sustainability.

Some major luxury brands are pushing out sustainable accessories collections, for example. But I don’t know how real this is if you are making a new fabric that doesn’t degrade quickly or that you can’t recycle. So if you ask me, fashion is moving in the right direction, but it’s not moving fast enough. That’s a sad fact.

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What China’s Affluent Consumers Want Post-COVID-19

Research and consulting firm Agility Research & Strategy just released its second Wave Of The Trend Lens consumer study, which is a follow-up to the initial series of interviews it conducted in late-January/early-February of 2020 at the beginning of the COVID-19 pandemic. For the study, Agility interviewed 1,040 affluent and HNWI individuals in mainland China, with each respondent having a minimum of $1 million in assets under management (excluding their primary residence).

“In this study, which we conducted across the Asia Pacific and in eight key markets to gauge the post-COVID-19 impact, China has emerged as a resilient market and one that seems to be a bright spot for Luxury brands this year,” says Amrita Banta MD from Agility Research & Strategy. “Along with China, affluent consumers from Indonesia and India were also more optimistic across key metrics while Malaysians, Japanese, and Singaporeans seemed more cautious about the economic climate and were looking to cut back on their spending.”

Key Takeaways:

Consumers are less optimistic about their economic situation and spending than they were back in January. Agility research shows that significantly more consumers continue to expect that their economic security, their property or investment values, and disposable income will all increase over the next 12 months, and they don’t expect them to decrease — a promising sign.

In fact, 57 percent of interviewees expect that the value of their property or investments will increase, 55 percent also expect an increase in their economic well being (down from 81 percent in W1), and 54 percent expect a boost in their disposable income (down from 83 percent in W1).

And the spending outlook for the next 12 months is also projected to change. Consumers’ spending expectations for the next year have declined across all categories since January, with travel-related categories registering the steepest drops. For instance, travel experiences are down to 38 percent (from 54 percent in W1), airline tickets are down to 33 percent (from 49 percent in W1), and hotels/accommodations are down to 32 percent (from 50 percent in W1).

The luxury travel industry is sure to register significant changes. As anticipated, domestic travel will recover more quickly than international travel. Fifty percent of interviewees foresee an increase in their domestic leisure trips, while only 34 percent of respondents expect to increase their international travels.

Since it’s becoming increasingly difficult to travel overseas, Chinese consumers are indulging in shopping sprees instead. This phenomenon has the potential to help certain segments and industries rebound faster on their roads to recovery. For example, skincare, makeup, and clothing are still strong earning segments, and Agility predicts that consumers are more likely to boost their spending on these categories, with 39 percent of respondents saying they will increase their spending on skincare (down from 49 percent in W1), 38 percent on makeup (down from 48 percent in W1), 37 percent on fashion clothing (down from 45 percent in W1), and 35 percent on fashion jewelry (down from 44 percent in W1).

Similarly, apparel and cosmetics luxury brands should have a smoother transition out of COVID-19 compared to other industries.

The study also showed how the pandemic has radically accelerated some consumer trends. The “upgrade trend,” for instance, continues, with 54 percent of the HNWI planning to buy more expensive luxury items. HNWIs are becoming more selective with their purchases, which means they are less willing to buy trendy or lower-quality products, instead preferring investment pieces. According to Agility, this means they’re “increasingly focusing on quality over quantity.”

Sustainability remains a priority, even in the post-COVID-19 world. Over 83 percent of respondents intend to do more for the environment, 81 percent want to buy more from sustainable brands, and 78 percent plan to invest more in sustainable companies.

At this point, the acceleration of e-commerce seems unstoppable, as an increasing number of HNWIs prefer shopping online versus in physical stores. That is especially true for consumers from smaller cities who don’t have multi-brand stores and physical showrooms where they live.

It is worth noting that 71percent of respondents have purchased luxury products online in the past six months, and for the 21-34 age group, that percentage is even higher (77 percent).

Buying products that say “Made in China” is still trending, and according to Agility highlights, 60 percent of younger consumers (age 21-34) have purchased an item from a Chinese luxury brand over the first six months of 2020. Moreover, 77 percent of consumers are willing to buy a product from a Chinese brand in the future.

In the experience economy, sports are the big winner. Considering that “living a healthy lifestyle” ranked ahead of “having enough money to retire” or “achieving financial success,” a shift toward more sporting activities isn’t surprising. Most of us realize that the pandemic has altered routines by bringing new health concerns to the forefront, and a correlation between obesity and the COVID-19 disease has been discussed at length. These issues have created a need for new hobbies. Working out, running, yoga, and cooking are all receiving more attention than in the past.

Forbes seems to agree with Agility, claiming that “wellbeing will emerge as a huge trend after the Coronavirus.” Erica Carranza, Ph.D. and vice president of consumer psychology at the research firm Chadwick Martin Bailey, told Forbes that “Consumption is driven by very strong motivations, like emotion, identity, and social connection. Those motivations aren’t going anywhere.” But she also states how “the values, habits, and norms that shape what we consume and how we consume could shift dramatically.”

Smart retailers and brands will know how to take advantage of these changes, and they’ll incorporate athleisure, home leisure, and loungewear into their collections.

The luxury industry cannot overcome these uncertain times by using the same old tactical decisions. In a post-COVID-19 world, building resilience and maintaining versatility has become competitive advantages. The brands that rethink their operating models and deliver more value to their customers will be the ones that survive this pandemic.

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US-Listed Chinese Companies Turn To Hong Kong’s Market

What happened: As US government pressure has grown over the past few months, various US-listed Chinese companies have looked at the alternative of a secondary listing on Hong Kong’s stock market. Alibaba was the first to list in Hong Kong in 2019, and since then, news followed that the search-engine Baidu was considering delisting from the US Nasdaq. This June, Yum China Holdings filed for a confidential $2 billion Hong Kong IPO, while and the Nasdaq-listed NetEase both had stellar Hong Kong trading debuts. And now, sources say that Group and the online discount retailer Vipshop are also considering secondary offers in Hong Kong.

Jing Take: Washington’s crackdown on US-listed Chinese companies will benefit Hong Kong at the right time, as the top international financial hub has been suffering due to ongoing protests, Beijing’s new national security rules, and the COVID-19 outbreak. Attracting and securing big IPOs would help Hong Kong reposition itself as a safe and stable financial market and will help it draw investor interest and Mainland money. But Beijing will also benefit from Sino-American tensions, as it will gain tighter control over these corporations while strengthening economic ties between the Mainland and Hong Kong. In the end, these moves will only make Hong Kong even more reliant on the Mainland.

The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

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Why The ‘High-Fashion Face’ Is China’s Next Big Look


High Fashion Face (高级脸)

About the Trend: 

The phrase “high-fashion face” was coined roughly three years ago in China, and it has been instrumental in shaping Chinese beauty standards for the Gen-Z demographic during this time. But now, its online popularity is gaining new momentum because the Weibo hashtag #CreatingtheHighFashionFace has attracted over 89 million views this month alone, with posts featuring makeup tips, celebrity posters, and selfie hacks.

Among Gen Zers, facial features traditionally deemed beautiful (a tall nose bridge, pointy chin, and big round eyes) are increasingly becoming associated with faces that have had work done to them. Yet, the so-called “high fashion face” almost directly contradicts those features, with its prominent cheekbones, angular jaw, wide-set eyes, and thick lips.

In 2019, Vogue’s Instagram post featuring the Chinese model Qizhen Gao was accused of imposing a stereotypical Asian aesthetic. Source:

Additional context:

When discussing celebrities whose facial structure embodies the high-fashion face, people typically name a mix of Asian stars that are commonly seen on runways and in films. The Chinese actress Du Juan, Victoria’s Secret model Liu Wen, and Japanese actress Mizuhara Kiko have all been nominated by netizens as the perfect representations of this quintessential Asian face. Although the phrase “high-fashion face” was only recently coined, the look has been celebrated as the epitome of “Asian beauty” in Western media for nearly a century, despite being underrepresented across East Asia.

However, the Western preference for Asian charm has faced controversy due to its racial undertones. In 2019, the official Instagram account of American Vogue posted a photo featuring Chinese model Qizhen Gao and received a backlash from Asian readers accusing it of promoting a stereotypical Asian aesthetic. Shortly after, a former employee of the magazine anonymously claimed Vogue was trying to “highlight the oriental features by using the model.”

Why Gen-Z consumers like it:

The Gen-Z demographic is a diverse and unpredictable one that requires deep probing to fully understand their socio-cultural traits. Despite passionately embracing traditional culture in their fashion choices, Chinese Gen Zers are noticeably challenging some mainstream beauty standards that have existed for thousands of years. The increasing visibility of the high fashion face challenges the narrow aesthetic conventions born out of China’s homogeneous racial makeup.

The Gen Z Verdict: 

Miaomiao Tu, a 21-year-old Chinese college student in touch with the latest trends, explained in an interview with Jing Daily that “people like the high-fashion face because it stands out from most pretty girls. It might not be the most dazzling beauty type, but it certainly is fresh and easy to look at.” Tu and her peers found the new phrase attractive because this beauty concept arose as an unexpected alternative aesthetic in China. In the past, luxury brands have been praised in China for casting local beauties with this so-called high-fashion face, as in Gucci’s 2017 vintage glasses collection campaign, where they collaborated with the Chinese actress Ni Ni.

A recent wave of inclusive brands like Fenty Beauty and Huda Beauty has fueled China’s increasingly diverse aesthetics. Source:

How luxury brands should approach this trend:

Despite putting more support behind their local culture, Chinese consumers continue to embrace fashion and beauty influences from abroad. Olivia Jiang, an associate account director at the digital agency DLG (Digital Luxury Group), believes that evolving beauty ideals in the West have paved the way for the high-fashion face trend in China.

“The recent wave of inclusive brands that have entered the Chinese market, including Fenty Beauty and the local Huda Beauty, are helping to fuel China’s increasingly diverse aesthetics,” Jiang said. “I think this [aesthetic] opens up more potential topics of conversation and ideas for brands to explore in the market.”

However, the high-fashion face look doesn’t necessarily mean that international luxury brands should jump on the bandwagon and swap their traditionally beautiful celebrities for alternative faces to revamp their image in the market. According to Jiang, “building a lasting brand in China is a long-term investment. And while latching onto a topic because it is in vogue at the moment may help drive buzz and exposure for a short period, it won’t fuel long-term growth.”

Jiang’s advice to brands that are collaborating with Chinese public figures is to fully consider their brand values and overall image before crafting a message aimed at Chinese consumers. Only then can they shape a celebrity strategy that leads to a successful localization within China’s dynamic Gen-Z sector.

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Douyin’s 100 Top-Performing E-commerce Campaigns

This post originally appeared on WALKTHECHAT, our content partner. 

Today, we study the top-100 best-selling KOL campaigns on Douyin (Chinese version of Tik Tok) during the last 30 days.

Our goal: helping you understand how to really sell on Douyin.

Note: the period studied ranges from the 17th of June to the 17th of July 2020. The study focuses on top-100 best-selling campaigns. All data comes from Newrank’s Xindou platform.

Campaigns analysis

Over 30 days, the 100 best-selling Douyin KOL campaigns generated a combined Gross Merchandise Volume (GMV) of 563 million RMB.

73% of this GMV was generated through sales on the Tmall platform.

Tmall also leads in terms of the number of campaigns directing users to the platform: 86 out of 100 campaigns.

However, this doesn’t mean that Tmall is the “best” platform to promote on Douyin. Large brands with large KOL budgets are more likely to use Tmall as their primary sales channels. They will be eager to drive sales to the platform to improve their reviews and organic rankings on the Tmall ecosystem.

In fact, looking at the GMV per campaign paints a very different picture. Tmall ranks at a late 3rd position and Weipinhui leads the way with campaigns 10 times bigger than the average Tmall Douyin promotion. also performs extremely well, with an average GMV per campaign 4 times higher than Tmall.

Tmall isn’t the platform with the highest-priced items either. The average product sold on JD on these top-100 campaigns was 478 RMB, against only 68 RMB on average for Tmall campaigns.

Native Douyin and Taobao stores perform poorly on all of the above metrics. Douyin and Taobao stores are usually operated by individuals and smaller companies. They don’t have the marketing budgets of companies operating Tmall or stores.

In terms of categories, Cosmetics and F&B dominate the best-performing KOL campaigns. Although many small KOL campaigns sell clothing through their account, this category is barely represented among top-selling campaigns (only 0.4% of total GMV)

Is Douyin moving upmarket?

Looking at these campaigns, it is striking that Douyin campaigns are moving toward some more expensive items.

Some of these pricier products include consumer electronics or home appliances, priced above the typical 0-300 RMB range of Douyin products.

However, this move toward more expensive products is still at an early stage. In fact, only 4 of the top 100 Douyin campaigns studied promoted products above 300 RMB. 81 of them promoted products cheaper than 100 RMB.


The analysis of best-performing Douyin campaigns provides interesting insights into Douyin marketing:

  • Douyin is still focused on the sales on cheap items (below 300 RMB and even 100 RMB)
  • However, some successful campaigns for more expensive products (above 300 RMB and even 1,000 RMB) are starting to emerge. These campaigns are more likely to drive traffic to premium platforms such as
  • Platforms such as and Weipinhui lead to better performance than Tmall campaigns on average
  • Taobao and Douyin Native platforms performed worst, most likely because they are operated by smaller brands or individuals
  • Cosmetics & F&B were the best-performing categories, while fashion represented only 0.4% of total GMV of the campaigns we studied

In conclusion, careful experimentation for the promotion of products in the 300-2,000 RMB range is becoming an option on Douyin. Brands with Tmall, or Weipinhui stores, and operating in the beauty or F&B sector, are most likely to encounter success with this approach.

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Has Livestream Selling Peaked in China?

What Happened: The Top 50 Livestreaming Sales Ranking List, which was just released by Pangqiu Data and other e-commerce service platforms, shows that the total turnover of top livestreamers plunged by 41 percent from June to July, garnering even lower numbers than in May.

Viya and Li Jiaqi held their top positions over the month, but middle-tier livestreamers were taken for a bumpy ride. Viya ranked first on the list with $303 million (2.103 billion yuan) gross merchandise value over July, while Li Jiaqi came in second with 700 million yuan less than Viya’s total. On the heels of June’s 618 Mid-year Shopping Festival, the overall livestreaming turnover of top hosts across all platforms saw a downward trend, with the earnings of many falling by double digits.

The Jing Take: While livestreaming has become one of the most powerful growth engines in China’s e-commerce battleground, many market observers and players are paying close attention to the sustainability of this trend over the medium to long-terms.

In April and May, when China saw steady spending growth after its COVID-19 lockdowns and quarantines ended, more and more celebrities, CEOs, and even virtual idols began jumping at the chance to present branded livestreams alongside top hosts. In June, e-commerce platforms leveraged livestreams to boost sales by handing out various digital vouchers for the mid-year 618 Shopping Festival. The selling frenzy during this period reached new heights, creating a surge of new e-commerce livestreams.

But after China took control of the pandemic and its citizens went back to their daily work routines, consumers returned to more rational consumption behaviors. Plus, it would’ve been hard for livestreams to maintain the booming pace they won during successive e-commerce sales holidays, both of which brought high-frequency media coverage with them. But luxury brands that are still exploring the possibilities of this marketing tool should note that sales numbers aren’t the only important indicator for livestreams. In fact, engagement numbers usually play a more vital role in evaluating them.

The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

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Tencent Scores A Big Q2 Before Trump’s WeChat Ban Plan

Tencent Holdings reported its second-quarter financial results on August 13, which showed its total revenue surging up 29.3 percent to $16.5 billion (114.9 billion yuan) and a net profit that increased 28.2 percent to $4.35 billion (30.2 million yuan) year-over-year. Both numbers topped analyst estimates. The outstanding performance during Q2 (ending June 30) is being attributed to the tech giant’s value-added services (VAS), such as social networks and online games.

Tencent’s multi-purpose social platforms, WeChat and Weixin (微信), have hit 1.21 billion monthly active users in total as of June 30. The duo, said chairman and CEO Ma Huateng (also known as Pony Ma) in the earnings call, are two very different products. “Weixin is a chat [app] to serve the users in the Mainland of China, whereas WeChat is a sister product which serves users outside of the mainland of China.”

The group also highlighted the revitalization of its content consumption in WeChat’s Official Accounts feature, reporting a rise in page reviews after three years of decline. Meanwhile, Tencent launched its Mini Stores feature, which backs small and mid-size enterprises by optimizing their digital storefront operations by supporting functions like livestreaming, order management, and after-sales services.

Online games, one of the most significant business categories for the tech powerhouse, continued its strong growth on the heels of a solid first-quarter performance. Driven by smartphone games, the revenue of the sector grew by 40-percent more than the same period last year. Yet Tencent’s online gaming business aligned with overall user activity during the pandemic. According to Tencent, user activity stayed normal locally while increasing internationally. “In China, user time spent on our smartphone games increased year-on-year but decreased quarter-on-quarter due to seasonality and back-to-office behavior,” the report stated.

Online advertising, despite only accounting for 16 percent of Tencent’s total revenue, saw promising growth during the second quarter, social ad revenue, in particular, which reported a 27 percent increase year-on-year. Much of this rise is due to how advertisers can now channel public online or offline traffic to their private domains through Weixin and WeChat apps like Mini Program and Official Accounts. However, media ad revenue did decline by 25 percent because of a weak advertising demand from brands and delayed content production and release times during COVID-19.

Yet Tencent’s stock tanked by 10.5 percent after a potential WeChat ban order from President Trump was released on August 6. Chief financial officer, Shek Hon Lo, responded to concerns over the potential ban on WeChat by explaining that the order was focused on WeChat’s US service, which won’t affect the company’s other businesses. “We are in the process of seeking further clarification from relevant parties in the US,” he noted.

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Chinese Brand Li-Ning’s New Collab Seen At First Live Fashion Week Since COVID-19

On Monday, Chinese sportswear maker Li-Ning showcased a collaboration with the Danish brand Soulland, which was taking part in a runway show at Copenhagen Fashion Week — the first official fashion week to return to live events (in addition to online presentations) after the appearance of COVID-19.

The two designs were teased during the week-long #NotInParis virtual exhibition, hosted by Highsnobiety in June, but they didn’t appear live until this week. 

The cross-continent partnership produced two co-designed running sneakers. Silas Adler, co-founder and creative director of Soulland, and Li-Ning’s design team in Beijing completed the collaboration by frequent video conference calls via WeChat.

We wanted to study the sport holistically and examine the mindful processes and shifts a runner goes through before, during, and following a run,” said Adler, adding that the concept of “Pre-Intra-Post” (Before-During-After in Latin) was at the heart of this collaborative project. 

The two sneaker models have minimal looks resembling modern architecture and are made with innovative, nearly-transparent fabrics. The first shoe, called the Shadow, features a hollowed-out sole and the phrase “Pre-Intra-Post” on the side, and the second, called Wind Ranger, has a side strap over the top and sits on a cushioned, angular heel.

The Shadow model is being sold exclusively in China for now but will be made available worldwide later this year. More retail information like stockist details and pricing will be announced soon, according to a Li-Ning statement.

From the outset, the Soulland team felt very strongly about exploring running, but wanting to do so in an unexpected way.”

The two design teams worked well together from the beginning after receiving an introduction from a mutual connection, said Li-Ning’s brand strategist, Liad Krispin. “From the outset, the Soulland team felt very strongly about exploring running, but wanting to do so in an unexpected way,” he stated. “For Li-Ning, running remains one of our core areas of product focus and leading design innovation. So right away, we were both already on the same page.”

This collaboration drops just as Li-Ning announced that it plans to resume its showing schedule on international runways. Rooted in the production of sportswear and footwear for sports like basketball and badminton, the Chinese brand first ventured into the high-fashion world in 2018 when it released a Spring 2019 collection during Paris Fashion Week. That was followed by a Fall 2019 collection, which the brand presented at New York Fashion Week.

2020 has also seen the brand’s first designs aimed at the white-hot sneaker market. This past January, Li-Ning released one collaboration with Random Identities — created by former Saint Laurent designer Stefano Pilati — and another with the English designer Neil Barrett’s eponymous label. 

What else can fashion fans expect from Li-Ning? “A trademark of any given Li-Ning collection is the contrast of Western sportswear silhouettes paired with elements of Chinese culture and tradition,” noted Krispin, adding that Li-Ning would also return to Paris Fashion Week this September to unveil a new collection in “an innovative way.” Stay tuned.

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