Exclusive: Calvin Klein Embraces Diversity with First-Ever Women’s Day Campaign for Asia


Gender diversity. Beauty diversity. Size diversity. The movement to embrace diversity in all its forms is all the rage in the Western fashion world, but it has yet to find fertile ground in Asian culture. That trend may be changing, however. For this year’s International Women’s Day on March 8th, American luxury fashion brand, Calvin Klein, is on a mission to empower Asian women to challenge gender norms.

Calvin Klein is about to roll out its first-ever Asia-initiated advertising campaign called “My Statement #MyCalvin” to pay tribute to female power in Asia. The campaign aims to push cultural boundaries and empower Asian women to make their own personal statements.

The new campaign carries the brand’s 2019 theme of “balance” and has attracted a diverse group of influencers and celebrities from Asia, including Chinese model Bonnie Chen, transgender Indian model Anjali Lama, Japanese filmmaker Shiori Ito, and Singaporean actress Victoria Loke, to explore their gender identities and how they remain confident, authentic and courageous while facing various pressure and obstacles from family, friends, and colleagues.

For the campaign, each individual — dressed in Calvin Klein’s activewear with almost no makeup — performs a monologue on how they turned their personal challenges into victories. The intimate way each person was shot adds to the emotional weight of their story.

Three months since Raf Simon’s exit from the brand, this is a significant campaign that shows Calvin Klein’s commitment to developing its presence in Asian markets. Previously, the brand made no special effort to address International Women’s Day in these markets. The brand’s last campaign that put women into special focus was for the U.S. market, when the brand unveiled its first fragrance under Raf Simon last summer, featuring actresses Lupita Nyong’o and Saoirse Ronan.

This time around, Calvin Klein will promote the “My Statement #MyCalvin” campaign on its official social media channels: WeChat, Weibo, and Facebook throughout the month of March. It also set up a mini-site for Hong Kong and mainland China to allow viewers to read about these celebrities’ stories in depth. In addition, it is collaborating with key opinion leaders (KOLs) to create special gift packages for customers.

The new campaign carries the brand’s 2019 theme of “balance” and has attracted a diverse group of influencers and celebrities from Asia. Courtesy image of Calvin Klein

The new campaign carries the brand’s 2019 theme of “balance” and has attracted a diverse group of influencers and celebrities from Asia. Courtesy image of Calvin Klein

While Calvin Klein’s campaign may be the first large-scale campaign focused on gender issues in Asia, it is not the first attempt by a brand to address the issues. In recent years, gender has become the new focus of customer experience initiatives and ad campaigns for many brands across the globe. In the luxury fashion arena in China, there are some early adopters, who have made attempts to address gender issues, but the customer reviews have been mixed.

Japanese premium brand SK-II’s “leftover” women ad campaign two years ago, for example, is still seen as a controversial one by many Chinese customers — those who share a positive view of it appreciate the brand’s courage in communicating their message in the public sphere, while those who dislike it feel that SK-II’s use of the term “leftover” is itself evidence of discrimination. French high-fashion brand Christian Dior, on the other hand, chose to tone down Maria Grazia Chiuri’s feminism campaign message in its marketing in the Chinese market, just to be safe.

Overall, challenging gender norms in the Asian cultural system will not be easy. While the entire Western world has experienced the disruptive force of the #MeToo movement, the spirit of #MeToo is spreading in a very delicate and subtle way in Asia. Calvin Klein’s latest regional campaign is a brave shot.





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How to Create an Authentic Luxury Experience for Millennials


Recently, a CEO of a luxury brand asked me if I would agree that for millennials, especially in China and Asia, luxury is all about experiences, suggesting that brand, quality, and craftsmanship were not nearly as important. That in today’s digital — everything all of the time — world, it’s all about connection. While I agreed about the need for immersive consumer experiences, I vehemently disagreed about the importance of the brand. In fact, I couldn’t help but think that managing the equity of a brand has never been as important as it is now. This means creating a proposition that resonates with consumers and inspires them. In short, if a luxury brand wants to entice today’s consumers, whether it’s in China or beyond, it needs to underscore its authenticity and relevancy.

Powerful words, to be sure, but what does it mean to be authentic and relevant? For the moment, let’s start with the opposite. During many of my brand strategy sessions, I often hear the expression “they feel staged” when people describe brands that they would never buy. Needless to say, when brand feels staged, it is neither authentic nor relevant. The synonyms unnatural, deceived, cheated, and faked come to mind. In other words, a staged brand is bullshitt*ng their consumers.

This may sound harsh, but in my experience, this is what consumers perceive if a brand is not authentic. It feels like something is off, even if people can’t tell what it is. And when they feel it, the brand loses relevancy and consumers walk away. Managers of brands typically have the best intentions, but if their proposition is off, if they use the wrong tools, then the brand will feel staged, lacking substance and meaning. And for luxury brands, this perception has three consequences: consumers will not pay premium prices; they will turn away; and they will tell their friends. Social media is a locus of people sharing their experiences, and if they’re negative, they will spread even faster.

So what’s the root cause of this problem? And why do brands, even some of the most established and successful ones, continue to make these mistakes? First of all, managing luxury brands is difficult. When executed well, however, they can deliver an exponential amount of intangible value, which explains why consumers pay such high prices. But when mistakes are made, the intangible value collapses, which can often be irreversible.

In my experience, it’s a lack of authenticity and relevancy that starts at the core of the brand; it’s the lack of a comprehensive brand definition that combines a rational reason to be and an emotional anchor for the customer. While brands often think that their definition is clear, in reality, it is often blurry or vague. Many are too similar to what other brands in the same field are claiming or doing. This similarity may feel safe for some managers (“because others do the same, there must be a reason, and we should be fine”), but feels staged for consumers (“the brand does what everyone else is doing”).

And for a luxury brand, nothing is worse than creating an experience that is no more than a category experience, even if the delivery is flawless. If the experience is not “branded,” or differentiated in some unique way, it creates no brand equity, no memory, and very little reason to come back. True, most luxury brands have brand manuals. But having a brand manual does not mean that the brand is defined in a way that creates the extreme value that a true luxury brand needs. I often these find brand definitions are too unspecific, relying too much on category norms, and more focused on repeated efficiency rather than on creating relevant and authentic experiences. And if a consumer pays for an experience that turns out not to be authentic, they will feel cheated, bullshi*tted when they have to pay a premium for it. Don’t expect them to come back ever again.

One of the paradigm shifts in today’s reality is that consumers are super-empowered — tethered to a digital leash 24/7. In China and beyond, they are much better informed than any generation before. And the younger they are, the more they expect. Don’t bullsh*t them! Start with evaluating your brand with a thorough brand audit. Listen to what consumers talk about your brand, but don’t limit your insights to what people comment on WeChat or Instagram. Look into the power of A.I. and how to connect consumer consent with all other data to identify patterns and understand what your consumers are looking for in real time.

Then define your brand precisely. Create a compelling story that makes your brand authentic and relevant in the eyes of your consumers. And then make sure that the execution is excellent across all touchpoints. Here quality and craftsmanship come into play. Hence, your entire staff needs to be properly trained, and they need to understand what luxury is, and how to deliver an inspiring experience in a way that is 100 percent on the brand. Most importantly, always create extreme value for your consumers, at all times, at every touch point. And no bullshitt*ng!





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Pop Idols Drive Beauty Engagement in China: Gartner L2


According to new research, 84 percent of all premium beauty brand engagement on Weibo is driven by posts featuring celebrities.

Lancôme’s and Estée Lauder’s successful pop idol partnerships are part of what boosted the brands to the top of the firm’s “Digital IQ Index: Beauty China” rankings. In addition to mobilizing famous influencers, the smartest beauty labels are investing in their marketplace visibility and WeChat services.

“This year’s Genius brands effectively leveraged campaigns across channels, driving high social engagement with celebrity promotions that linked to item purchase pages,” said Liz Flora, editor of APAC research at Gartner L2, New York. “They also increased their presence on first-page beauty search results on Tmall, which is surfacing more premium brands and increasingly becoming a first-order product search destination.”

E-commerce opportunity

Mass beauty brand L’Oreal Paris took the top spot in Gartner L2’s rankings. Joining L’Oreal Paris at the top with “Genius” scores are runner-up Lancôme and Estée Lauder in third place.

Premium labels are turning to Alibaba’s Tmall to reach Chinese shoppers and ramp up their discoverability, with 86 percent of upscale beauty brands selling on the e-commerce platform. L2 also notes that these labels are investing in their Tmall presence with content, marketing campaigns, chatbots and loyalty initiatives.

This is paying off for the category’s leaders, as Estée Lauder and Lancôme were among the bestselling products for Singles’ Day and Lunar New Year.

In April, YSL Beauty launched on Tmall’s Luxury Pavilion and sold more than $4.77 million (30 million yuan) in its first 14 hours. This broke the previously held record from Givenchy Beauty, which generated 29 million yuan in sales in a single day during its debut.

Celebrity is a key growth driver for beauty brands in China. For instance, Estée Lauder products that were mentioned and linked by celebrities saw a 723 percent growth in sales.

Hugely popular in China are pop idols, and their influence also boosts engagement on Weibo.

Lancôme worked with TFBoys member Wang Junkai on a Weibo campaign, generating traffic towards Tmall and consumer interaction. The two posts created with the pop star each saw more than 4 million engagements.

Of the 10 Weibo posts from index brands with the most engagement, nine featured pop idols.

When it comes to luxury on Chinese social media application Weibo, younger consumers are the prevalent force driving usage.

Seventy percent of luxury consumers on Weibo are younger consumers born in or after the 1990s, which is much greater than the percentage of young consumers in the total population, according to a whitepaper from Secoo. Weddings, children, apparel, food, housing, transportation, literature, fun, design, and pets are the leading topics of discussion in the luxury space on the social network.

While Weibo is the most important social media channel for beauty, WeChat serves as a platform for both engagement and e-commerce.

Seventy-eight percent of the index brands have a WeChat mini program, and many of them use it for online stores.

“Brands are operating in a completely different digital ecosystem in China and need unique strategies for local social and e-commerce platforms,” Flora said. “These include the established digital channels like WeChat, Weibo, Tmall, and JD.com as well as newer apps popular with millennials and Gen Z like Douyin and Little Red Book.”

Slowdown safe

Gartner L2 notes that Japanese brands have gained ground against Korean labels, as Chinese tourists are not visiting South Korea as much due to geopolitical tensions. Searches for brands such as Shiseido and SK-II were up on Baidu.

Luxury brands saw their stock prices stumble at the start of the year amid concerns that weakening sales of iPhones in China could foreshadow slowed consumer spending in the world’s second-largest economy.

Technology giant Apple announced that its $84 billion in revenues for the quarter ending Dec. 31 would fall short of the company’s projections of up to $93 billion. Since CEO Tim Cook specifically mentioned slumping sales of its high-priced smartphones in China, many investors are worried that sales of luxury goods may further slip amid other economic tensions.

As an accessible luxury category, beauty is poised to weather any potential slowdown in China, as consumers will continue to scoop up affordable products.

Lipstick, in particular, is a popular product, especially for gifting. In 2017, lipstick sales climbed 97 percent.

“Lipstick is popular as an affordable luxury gift in China, especially for the beauty brands owned by major fashion houses,” Flora said. “It’s a way for aspirational middle-class shoppers who can’t afford a $1,200 YSL handbag to own something made by the brand.

“It’s a frequent focus of Chinese beauty bloggers, especially on lifestyle platform RED, where lipstick shades from top brands often become the top trending hashtags on the app,” she said. “Lipstick is a major driver of online beauty sales for luxury brands – YSL Beauty’s lipstick is the de facto ‘girlfriend gift’ in China and takes up 85 percent of the brand’s unit sales on Tmall.”

 

This post by Sarah Jones originally appeared on Luxury Daily, our content partner site.





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A List of Celebrities’ Commercial Power in China, and More


In “Chinese Whispers,” we share the biggest news stories about China’s fast-moving luxury industry that have yet to make it into English.

In this week’s edition, we discuss:

  • Shawn Yue, Yang Mi, and Lu Han‘s top celebrity commercial value rankings
  • An interview with the Chinese maker of the viral “Amazon Coat”
  • Tom Ford Beauty’s first foray into the Chinese e-commerce market
Hong Kong actor Shawn Yue (余文乐), who is the brand ambassador for Tommy Hilfiger in China, had the largest influence on consumer purchases in the fourth quarter of 2018. Photo: LadyMax

Hong Kong actor Shawn Yue (余文乐), who is the brand ambassador for Tommy Hilfiger in China, had the largest influence on consumer purchases in the fourth quarter of 2018. Photo: LadyMax

1. Report Ranks Chinese Celebrities’ Commercial Value — LadyMax

Hong Kong actor Shawn Yue (余文乐), who is the brand ambassador for Tommy Hilfiger in China, had the largest influence on consumer purchases in the fourth quarter of 2018, according to a new report co-released by the data intelligence firm CBNData and Alibaba Group. Actress Yang Mi (杨幂), who has worked closely with Michael Kors, Estée Lauder, and Stuart Weitzman, took second place, followed by singer Lu Han (鹿晗), who has collaborated with a slew of luxury brands from Louis Vuitton and Cartier to Piaget.

A "Made in China" winter coat by the Chinese fashion brand Orolay has become the hottest-selling item on Amazon this winter. Courtesy photo

A “Made in China” winter coat by the Chinese fashion brand Orolay has become the hottest-selling item on Amazon this winter. Courtesy photo

2. “Amazon Coat” maker says business got a huge boost in January – luxe.co

A “Made in China” winter coat (priced at $129.99) by the Chinese fashion brand Orolay has become the hottest-selling item on Amazon this winter, going viral on social media and headlining mainstream news outlets.

In an exclusive interview with the Chinese fashion outlet luxe.co, Orolay’s Chinese CEO Qiu Jiawei said that the company’s revenue in January had reached $1 million for the first time—a huge jump from the brand’s full-year sales in 2017. He also estimated Orolay’s full-year sales in 2019 at approximately $30 to $40 million.

Tom Ford will launch a flagship store on Alibaba's Tmall platform in early March. Courtesy photo

Tom Ford will launch a flagship store on Alibaba’s Tmall platform in early March. Courtesy photo

3. Tom Ford Beauty to open a flagship store on Alibaba’s Tmall marketplace – Eastmoney

Seeing huge demand from Chinese beauty consumers, premium American brand Tom Ford announced that it would set up a flagship store on Alibaba’s Tmall platform in early March. The move is the brand’s latest effort to increase its presence in the Chinese market after debuting a boutique store in Shanghai last November. The new Tmall store will sell a range of Tom Ford beauty products, from lipsticks and fragrances to beauty gift sets.





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Condé Nast International Takes Vogue to Hong Kong


Condé Nast International, the worldwide acclaimed fashion publisher, will be launching the 25th edition of its signature fashion title, Vogue, in Hong Kong soon. The inaugural issue, which will go on sale on newsstands in Hong Kong and Macau on March 3rd, features American influencer Gigi Hadid and Chinese model Sun Feifei on the cover. Both are dressed in Chanel Haute Couture, from the last collection by Karl Lagerfeld, who just passed away two weeks ago. A bilingual website — in traditional Chinese and English — will also go live today to complement the launch.

The Vogue Hong Kong team will be led by Peter Wong, who assumes the role of Editorial Director. Joining Wong will be Senior Fashion Content Editor, Daniel Cheung, and Fashion Director, Anya Ziourov, as well as Publisher, Desiree Au.

To differentiate its Hong Kong edition from Vogue China, which was launched by the founding editor-in-chief Angelica Cheung in 2005, Vogue Hong Kong’s editorial will strike a balance between international trends, local talents and tastes that reflect Hong Kong as an international melting pot where “East meets West.” Vogue Hong Kong will also have a special focus on art and culture, as the city has evolved into a vibrant art venue across Asia in recent decades.

In addition to the print version and its bilingual website, Vogue Hong Kong will also be on social media channels, including Instagram to reach and engage with consumers. However, there are no plans to put the Vogue Hong Kong website content behind a paywall at this time.

Vogue’s expansion into Hong Kong indicates the magazine’s confidence in the Hong Kong market for both advertising revenue and a discerning readership. Whether it can truly deliver print content that resonates with today’s digital-native audience remains to be seen.





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8 Essentials to Working with Luxury Chinese Tourists


One of the most coveted segments in the Chinese outbound tourism market is also one of the hardest to get right when it comes to marketing and service: luxury travelers. We interviewed three tourism professionals with extensive experience in the Chinese luxury sector to understand how to stand out – and avoid making major blunders – with affluent Chinese travelers.

Our expert panel:

  •  Ivy Aiwei Jenkins is Director at HEDERA, a full-service agency specializing in the Asia market, dedicated to luxury hotels, retail, and lifestyle. Educated in Switzerland, Ivy also has previous experience working in the high-end hospitality industry in Beijing, Dubai, Abu Dhabi, Kuwait City, and London.
  • As part of his 20+ years in Chinese outbound tourism, Dragon Trail’s Roy Graff was the co-founder of UK luxury training and consulting partnership China Edge, working with luxury hotels and retailers in London, and has led high-end Chinese delegations around the world.
  • Erica Giopp works as a freelance luxury travel expert, collaborating with bespoke travel companies like Italy BAO (By Appointment Only) as a Luxury Travel Concierge.

1. Make communication your specialty

“There is always an essential element of human touch between yourself and your guests for high-end hospitality, and that is valued even more by the Chinese when they travel abroad,” says Ivy Aiwei Jenkins.

“Chinese-friendly amenities show your sincerity, bilingual marketing materials, and welcome kits help you to share your information, but your Chinese guest relation adds the most value. European and American guests can grab anyone to share their experiences, either positive or negative, to allow you the opportunity to take actions accordingly. Chinese is a different story, whether there is a language barrier or not. To avoid direct confrontation, not lose face, not look bad, it is hard for them to share, especially something negative. Therefore, having the Chinese guest relation empowers you, as this person or department will enhance communication and in turn, smooth their total guest experience and encourage repeat business and/or referrals.”

If you’re providing a Chinese guide to Chinese high net worth (HNW) clients, make sure that guide also has a high education level, understands the market segment, and speaks either very good Mandarin or the same dialect as the clients, advises Roy Graff.

Bespoke luxury tour guide Erica Giopp is Italian and speaks Mandarin as a second language. She uses her multi-lingual abilities and cultural knowledge to bridge the gap between her clients and their travel environment. “My suggestion is to always do your best to create connections between travelers and locals; when getting into a coffee bar, we order coffee and as soon the barman makes his little joke (Roman barmen always joke), translate it to the clients, let them answer and get involved in the conversation. Helping customers to interpret and understand what is going on around is the highest service you can provide. A client from the US has sometimes easy access to the understanding of local habits; it takes a bit more effort for a Chinese one because of different behaviors and cultural backgrounds.”

2. Understand your customer

There’s a lot of diversity even within the luxury market. “The best practice is to pay attention to their background, their previous travel experience, their education. Chinese are not different from other nationalities in that you need to take the time to understand them and give them personal service. Where do they come from in China? How do they make their money? Take time to learn their personal background. Some may appreciate a friendly approach; others may look down on servers. Take personalization one step further for luxury travelers, including understanding their drink and food preferences,” advises Graff.

Giopp offers concrete examples based on her own experience: “Travel rhythm habits are different for those clients coming from big cities in mainland China, from Taiwan and Hong Kong, those coming from Singapore, and those living and working abroad. People from Guangzhou are generally more used to ‘take it slowly’ than Beijingers. But every person is different of course, and that’s why we do bespoke tours.”

“Baby, baby, baby!” is Jenkins’ advice for the most important client to understand. “If kids can sometimes influence a family on their hotel choice in the west, then kids are a million percent the decision maker in China, especially the HNWIs. Try to find out as much as possible about the purposes of their stay, details, kids’ preferences, whether it’s a boy or girl, what age they are, and play up your amenities for children.” Ivy does note, however, that it can be harder to find out background information about affluent Chinese travelers, perhaps especially those traveling with family, because of the high value they place on privacy.

3. Realize that their ‘luxury’ standards may be higher

“The mistake is to think that in China they’re not used to luxury already. In Old World destinations, the service and hardware tend to be less luxurious than what they already have in China,” says Graff. “We make the mistake of thinking: We know what luxury is, and because they’re from China they’re not used to it.”

Actually, issues with hotel room size is one of the most common complaints from HNW Chinese tourists in Italy, says Giopp. “Hotels in city centers have rooms that are often smaller than the worldwide average, especially those located in historical buildings. When we are able to make the customer aware of it before booking the accommodation, then it is not an issue. However, it turns into a problem when it’s a completely unexpected factor at the check-in moment. The historical value, the service, the beauty of the furniture, and the astonishing surroundings sometimes are enough to compensate for the size of a room, but the client has to be aware of it before his arrival.”

4. For food, balance comfort, and adventure

Food is an important part of the Chinese tourism experience abroad, and Chinese travelers can be quite adventurous diners, but some considerations and modifications will still need to be made. “Providing an entree, first and second courses, plus dessert, could sometimes be very unsuccessful,” says Giopp. “Chinese travelers generally want to taste more but eat less. They normally enjoy fish, meat and vegetable dishes more than enormous amounts of pasta. They are always curious and open to tasting raw food such as carpaccio, tartare or octopus salad, but serving those as main dishes is risky. Offering different dishes to taste and share together would be more appreciated.”

But allowing for the food to be eaten in a shared style, like it is in China, may not be enough if the tourists are traveling far outside their comfort zone. “If they’re going through something very unfamiliar, they need Chinese food to balance it out. Even when they’re used to luxury, ultimately it will be home comforts they miss,” advises Graff. When taking high-end delegations to both Zambia and India, he found that the travelers tended to be unimpressed with luxury-style Western food. He started to bring various Chinese sauces and pickles that the guests could add to their food, managed to find a Chinese restaurant in a small Indian city, and in one Zambian hotel, even went into the kitchen and got the chef to make them a big bowl of zhou, a simple but comforting rice congee.

5. Be Chinese-friendly, but don’t go overboard

We’ve all heard tips on making your hotel or travel business “Chinese friendly”, and for the most part, this is good advice. But with sophisticated luxury travelers, Graff warns, you’ll need to strike a delicate balance. “They won’t want to feel that you’re serving mass market Chinese, but rather luxury clients from other markets, too. They don’t want to feel grouped together. You don’t necessarily have to have everything available in Chinese, all the Chinese amenities. In the UK, offer authentic English afternoon high tea,” he says, explaining that this quintessential experience will be more in demand than Chinese-style green tea.

But Jenkins argues that HNWIs might enjoy even such basic amenities as instant noodles – although it won’t look good to provide them in a hotel room. Instead, she suggests offering a Chinese tea set, a large bottle of still water, and an electric kettle. She also recommends providing a humidifier in hotel rooms, especially for women, who see this as beneficial for their skin. Fresh, exotic fruits are another suggestion, but “please, no big pineapple as nobody would be bothered. More like cherries, strawberries or lychees, should they become in-season,” she specifies.

6. Don’t force them to shop

Shopping is a very delicate area. On one hand, shopping is still an important part of an international trip for Chinese tourists, but on the other, they are extremely wary of the forced shopping associated with low-end group tours. “To give shopping advice or try to drive them into any shops” could give Chinese visitors the idea that you are receiving a commission, says Giopp, which will reflect very badly on you. “In terms of luxury goods, Chinese clients are particularly aware of what they want and what it costs. They make accurate research on brands and products before they leave for a trip, and when they reach the destination they normally already know where to find what they want. We should fulfill clients’ desires, give suggestions if required, and mention niche valuable products as general cultural information and not as a shopping imposition,” she elaborates.

Roy echoes her sentiments that luxury clients will want “shopping without pressure” and be especially interested in things that are made locally. He recommends putting aside time in the itinerary for shopping should the client desire it, and to give an explanation of local shopping culture – for example, letting them know if bargaining is expected. Likewise, inform your Chinese guests about tipping expectations in restaurants.

Enjoying a relaxed aperitivo is one of the small surprises Erica Giopp arranges for her clients, who typically ask for a packed schedule. Photo by Guido Caltabiano (@guidocal)

Enjoying a relaxed aperitivo is one of the small surprises Erica Giopp arranges for her clients, who typically ask for a packed schedule. Photo by Guido Caltabiano (@guidocal)

7. Avoid cold service

“‘They are cold, they don’t talk, they don’t like to chat, they never give tips, they are hard to read, they come to Europe once and they don’t come back, so I can’t be bothered to go the extra mile either’. This is more or less the standard honest feedback on Asian guests, including the Chinese,” Jenkins states bluntly. “Because of cultural differences and/or language barriers, and fear to do anything wrong, a lot of European hotels’ staff members choose not to interact [with Chinese guests], and therefore, a vicious cycle is formed.” This impression of cold service does not sit well with the Chinese guests, who will feel singled out as a minority, and are sure to tell their friends.

Even if there is a language barrier, Jenkins has good advice for offering a warm welcome that transcends this: “Politeness, smiles, welcome, hospitality, sincerity, care – all of these can be translated through body language and eye contact, and you just simply need to collectively do so.”

8. Give them small surprises

How do you go the extra mile that will generate positive word of mouth with your HNW Chinese clients – arguably your best marketing strategy? The trick lies in small surprises.

“Try to fit in all kinds of upgrades, small gifts or surprises to give them a feeling of exclusivity. The key is to work with them in such a way that they will tell their friends about you,” says Graff. Jenkins’ advice for working with the children of luxury guests is similar. She advises offering small gifts, “especially something that is collectible and/or a series of characters to collect. This helps you on their repeat business and the storytelling to other, similar families.”

For Giopp, the small surprises come in the form of relaxing and memorable “experiences”, one of the biggest buzzwords in travel right now. “Chinese travelers do not dislike relaxing, but they really want to be sure to have the whole schedule packed; they are concerned about time wasting,” she explains of her often money-rich, time-poor clients. “We organize the tour they want, just making sure to save a few moments to take a nap, enjoy an aperitivo, or look at the sunset, not as key points of the program, but as an unexpectedly delightful part of the trip.”

This post originally appeared on Dragon Trail, our content partner site.





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Moncler’s “Genius” Project Paid off in 2018. What’s Next?


The Italian luxury brand, Moncler, took a gamble on a disruptive retail experiment, conveniently dubbed the “Moncler Genius Project.” It consisted of a series of capsule collections by a group of revolving designers. And the result?

The company said on Thursday that its full-year revenue growth increased by an impressive 22 percent year-on-year, at constant exchange rates to $1.62 billion (€1.42 billion), as efforts to grow its global business, specifically in Asia and Mainland China, appeared to pay off handsomely.

For the fourth quarter of 2018, the brand’s revenue grew by 20 percent year-on-year, per their corporate release. Its full-year net income jumped by a whopping 33 percent to 332 million euros, while net cash flow hit a healthy 450 million euros by the end of 2018. Of particular note, Moncler’s marketing expenses for the first time nearly touched 100 million euros, which jumped seven percent compared to last year’s.

Today, the development of a mono-brand group like Moncler is a fascinating case to watch, especially at a time when the luxury industry is in a frenzy of forming and strengthening multi-brand conglomerates from leading players, such as LVMH and Kering to newcomers like Capri Holdings. But now, the world is watching billionaire CEO Remo Ruffini and how he plans to drive Moncler’s desirability and relevance among a millennial audience.

Enter the “Moncler Genius Project.” By inviting a number of fashion designers — Pierpaolo Piccioli, Craig Green, Simone Rocha, and Hiroshi Fujiwara — to reinterpret the brand’s signature down jackets, Moncler embraced a radically different retail model beyond one designer, one look. The idea was first announced in February 2018, during the Milan Fashion Week, and then came into full execution in June 2018. Last week, Moncler just unveiled its second generation of Genius collaborations.

As the first digital-native project of its kind at Moncler, the “Moncler Genius Project” was highly effective in nurturing a new generation of customers, broadening the brand’s online reach, as well as driving traffic to offline stores, said Roberto Eggs, chief marketing and operating officer of the brand in a conference call earlier today.

“The number of [digital] impressions [of the brand] in 2018 increased by 40 percent [from the year before] and unique visitors to Moncler’s website grew +59 percent,” said Eggs. “Each time we have a drop, it increased the traffic to the store in the next few days. Customers not only are interested in buying genius products but also our major one.”

In China, Moncler has mainly focused on Tencent’s WeChat platform to communicate with consumers. Eggs mentioned the use of mini-programs in social-selling. He also said that Moncler thought Chinese consumers were very eager to discover the brand’s products even though its presence in the country is still very limited for now.

Additionally, Moncler was seen to be quite active on Douyin, a popular youth-oriented social media platform in China, debuting short video ads with selected Chinese celebrities. When asked if Moncler would enhance its e-commerce presence in China, Eggs said “[Alibaba’s] Tmall is a part of our assessment.”

Investment bank HSBC recently downgraded Moncler shares to “hold” from “buy” position. Courtesy image

Investment bank HSBC recently downgraded Moncler shares to “hold” from “buy” position. Courtesy image

To date, Chinese consumers have been an extremely significant demographic for Moncler. 2018 marked a turning point, where the brand experienced the rising purchasing power of customers from the local market versus overseas Chinese tourists. They also noticed that Chinese were more moving into neighboring countries like Singapore, Australia, and less to Hong Kong and Taiwan, for luxury consumption.

However, investment bank HSBC recently downgraded Moncler shares to “hold” from “buy” position. The main reason is the inherent risk that is associated with the company’s business model, as fashion, by its essence, comes and goes. In that content, diversity offers a natural hedge.

Going forward, Moncler has a big retail expansion plan for 2019, which includes 15 direct of sales (DoS) opening and 15 wholesale openings. It also upped the ante in travel retail and is opening between 8-10 stores in airports as well.

Regarding competitive challenges from luxury rivals and obstacles, such as slower economic growth in China, and the continued trade war, Ruffini said, “We are confident on Moncler’s ability to continue the success in 2019.” He’s betting on the quality of products and services that Moncler will deliver to keep up the momentum. He’s all in.





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JD Expands its Luxury Reach as General Business is Getting Softer


JD, China’s second-largest e-commerce platform, is hoping for a growth spurt. It extended its partnership with Farfetch, merging its luxury portal, TopLife, into the high-end etailer’s China business on February 28. The strategic move, one of many JD has been making in an attempt to alleviate the company’s continued growth slowdown in recent quarters, is a clear indication that China’s economic woes have spread to the e-commerce industry.

The new deal, based on the two parties’ relationship since July 2017, will give Farfetch a “Level 1” entry point on the app of JD. In exchange, JD will gain access to Farfetch’s network of more than 1,000 luxury brands and boutique partners. Previously, Farfetch has been benefitted from JD’s logistics capabilities in China.

Earlier today, JD also released financial results for the fourth quarter and full-year ending December 31, 2018, which, again, indicate that the business is not immune to China’s economic slowdown.

For the fourth quarter, which included China’s biggest annual shopping festival Singles’ Day, the company reported a 22.4 percent increase of net revenues from the same period the year before — narrowly beating the estimates of financial analysts. However, the results also represent the e-commerce player’s worst quarterly revenue growth rate since it went public on the U.S. Nasdaq in 2015. The company’s net revenue for the full year 2018 stood at RMB 462.0 billion (US$67.2 billion), up 27.5 percent from the full year of 2017.

JD’s growth of active user acquisition has also slumped in the past two quarters. The company said its annual active customer accounts stood at 305.3 million by the end of 2018, indicating a drop from 313.8 million users at the end of last June before the company’s founder and CEO, Richard Liu, was accused of sexual assault by a Chinese university student in the United States.

JD has, nonetheless, made some progress in attracting more premium brands to list on the platform in Q4. For example, in October, the company formed a strategic partnership with the Xinyu Group, the largest international watch retailer in China, leading to the launch of several flagship stores for luxury watch brands Rado, Hamilton, and Certina. Additionally, DKNY, and Sulwhasoo, a leading luxury beauty brand based in Korea and owned by AmorePacific, also set up stores within JD.

JD’s shift in business focus may come at the right time. Over the past several months, a slew of luxury groups from LVMH to Kering to Hermès has demonstrated its resilience in a slowing economic environment, indicating a continued demand from Chinese consumers. Consequently, JD’s extended partnership with Farfetch will give the company a boost in its luxury operation in China, and providing its customers with a wide variety of brand options that usually takes years for a new player to gain traction in the highly competitive luxury fashion market.

And finally, JD’s major competitor, Alibaba, has also stepped into the luxury business in recent years. Alibaba not only set up its own Luxury Pavilion, a special platform for luxury brands only, about two years ago, but it also formed a joint venture with Net-a-Porter in October 2018. Let the games begin.





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Millennial China’s Expensive Skin | Jing Daily


“As I’ve grown older, I’ve started to invest more money into skincare than designer bags,” said Linda Zhong, a 24-year-old live-streaming hostess in Shenzhen, China. After a rough calculation, she estimated her monthly skincare budget at around 10k RMB ($1,488). “Skincare is the most rational investment a woman can make to herself,” she added.

Half of that hefty budget goes into her daily beauty regimen, which starts with Skin Caviar Luxe Cream ($505/50ml) from the Swiss brand La Prairie, in the morning, and a skin-smoothing laser, Iluminage Touch, from Israeli brand Iluminage ($587), before bedtime. But even this sophisticated combo of luxe products and black-tech beauty devices no longer suffice. Last year, she hired a Korean skin coach, located in a local upscale skincare management clinic, for more professional advice. Now, twice a month, she checks in with her coach for a suggested treatment based on her skin condition, be it 24k Gold Facial from the Japanese brand, SIRRAH ($156) or Diamond Peel from French luxe brand, Chantecaille ($200).

In millennial China, Linda is hardly alone in being young, but spending hugely on skincare. More and more Chinese young women are flocking into skin management clinics for pro-level coaching on beauty supplements, injectable Botox or fillers, and holistic nutrition. “The skin management industry is in a state of blowout since 2016. There are more than 1,000 skin management clinics in the city of Wuhan alone,” Wang Wenle, secretary-general of the National Office of skin managers, told Chinese news portal Jiemian during an interview. Marketed as being different from traditional beauty salons, these skin management clinics appoint Korea-trained dermatologists to analyze your face, tailor an anti-aging treatment package, and coach you on future steps for prettier, more youthful skin (which often means cosmetic surgery). On the lifestyle platform, Little Red Book, more than 70k experience-sharing posts are written with the hashtag “skin management.” It’s not an exaggeration to say that skin is a serious business in China today.

The Chinese fanaticism for perfect skin feels more prevalent now more than ever, as spending on skin improvement products and procedures has risen to previously unthinkable levels. In the West, such investments are usually limited to a select group of wealthy, high-maintenance women. Yet, in the urban, middle-class of China, it’s a mainstream practice. And while there is no singular truth to Chinese women’s skincare obsession, there are three major cultural motives shared by many.

A typical afternoon in a Guangzhou-based luxe skincare management clinic, shared on Little Red Book. Photo: screenshot

A typical afternoon in a Guangzhou-based luxe skincare management clinic, shared on Little Red Book. Photo: screenshot

First, the idea of looking eternally young has a particularly strong tie to personal success in China. Different than the global marketing narrative of “embrace your age,” the Chinese narrative wants a woman to look like an 18-year-old girl regardless of her actual age. In fact, the more a woman can conceal her age via skincare, the more successful she’s perceived to be. Fashion magazines and TV shows continue to glorify mature women with overdone cheeks for being “冻龄女神”, translated as an age-freezing goddess — a euphemism for a “good example” of the type of woman who looks much younger than her age. “I go to regular coaching in skincare clinics not because I am narcissistic,” says Cynthia Zhang, a 27-year-old investment banker based in Hong Kong, described a woman’s face as her most important social capital. “I go because being beautiful makes my husband proud and gives him mianzi among his friends.”

Second, perfect skin is what people only get to see in social media today. The prevalence of beauty filters has made it believable that perfect is the new normal, magnifying the already-existing obsession with flawless face. Last week, Spain-based retailer Zara featured a non-filtered model, Jingwen Li, in a campaign, where the model’s freckles upset many Chinese netizens. Freckles, just like other natural skin defects, do not meet the modern Chinese definition of beauty. As a result, many regarded Zara’s choice as a racially discriminative portrait of Asian women. When Zara later explained the campaign as being “non-processed” and aesthetically dictated by “a different Spanish beauty standard,” the following discussion on Weibo showed that the brand’s no-filter attitude had shocked many. In China, posting a non-filtered group photo in WeChat Moments could be perceived as committing social suicide. In an age when people heavily consume carefully filtered social selfies and influencer content, even the slightest skin imperfection could stir public discomfort. Call it an unrealistic expectation, but the over-polished airbrushed beauty standard is here to stay.

Third, but most importantly, having a youthfully pretty face is still unabashedly seen as a legitimate way to get ahead in life. Linda, the live-streaming hostess, told Jing Daily, “I invest in my looks because my face gives me many benefits. Once I went to the hospital and forgot to take my purse with me, and the person behind me in the line offered to pay for my registered fee. Plus, guys in parties notice me first.” Besides the day-to-day benefits, looking pretty also gets Chinese women more advances in life’s bigger questions. “(The skincare’s) largest audience is Chinese women in their golden career age from 22 to 33. Because having a pretty face is having a successful image, it helps people advance in career, love, family, and friendship,” said Gordon Niu, manager of Walkin International, a beauty e-commerce management firm in Asia Pacific. Certainly different than the global #MeToo and #Time’s Up environment, but it’s still politically correct for Chinese women to openly leverage her good looks as social capital to get a higher salary, a successful husband, and more digital attention that could turn into influencer dollars. Thus, the investment in perfect skin is not only an aesthetic choice, but also a coldly realistic one.

Despite the surge of feminist ads in recent years, the Chinese attitude towards women aging remains hostile. The mentality of “aging means losing to women” sadly still prevails. Until a radical cultural movement shakes things up, many other investment forms, such as skin-management, are likely to take place.





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How Vipshop’s WeChat E-Commerce Mini-Program Added Users but Not Revenue


Vipshop, the Chinese e-commerce site, has managed to increase its user growth at a time when the vast majority of e-commerce sites are struggling to reach new users. One reason: it’s WeChat mini-program.

According to their latest earnings release, Vipshop’s users on its WeChat mini-program has grown an impressive 38.3 percent year-over-year. There are a couple of factors behind this. To begin with, Vipshop’s mini-program is a fully functional e-commerce site, meaning it offers the user the same amount of information and content that could be found on a standard e-commerce website—from fashion and beauty to housewares and child products to even accessible luxury products. And it covers them with as much depth.

Vipshop's WeChat mini-program.

Vipshop’s WeChat mini-program.

Another factor has to do with the intrinsic nature of a WeChat mini-program. Beyond the simple fact that you don’t have to download an extra app, the majority of WeChat users live and breath it 24/7, which makes it super convenient for Vipshop customers to check (and recheck) for deals that can go live at any second. And to take advantage of this sense of urgency, the mini-program was designed with a countdown bar on top of each product indicating how much time remains, as well as how many people have already placed orders, reinforcing the message to buy, buy, buy.

But what makes selling on WeChat so profitable is its potent social sharing feature, which more and more companies have adapted their business models around, creating a sort of Facebook/Groupon mash-up. And Vipshop too. In June 2018, they launched a new B2C selling mini-program, Yun Pincang (云品仓), which invites an individual customer to become an “advocator” of a product. The customer, or “advocator,” is encouraged to share it with as many people as possible. If anyone buys it, the “advocator” gets a commission. And so it goes. The larger the outreach, the more the “advocator” can save on the product. While this marketing approach has been rapidly growing, and in some cases, adding to a companies profitability, the legitimacy of WeChat social selling is often challenged and is often criticized as a type of pyramid scheme.

Then there is Tencent’s 2017 investment in Vipshop, which has helped it get a priority pass from Tencent. For example, on the “wallet” page on WeChat, Vipshop is listed as one of the shopping mini-programs, along with other competitors like Pinduoduo and Mo Gujie (蘑菇街). Additionally, Vipshop has also reported seeing a higher percentage of male and younger visitors on the mini-program than on its website, which is another indication that its user base is indeed expanding.

Yet, like other e-commerce sites, Vipshop’s revenue hasn’t reflected its user growth. We recently reported that in Q4 2018, although the company’s growth rate of active users was impressive, Vipshop yielded lower-than-expected revenue. So it still remains to be seen whether Vipshop can turn its increased user growth into increased revenue via WeChat. And how that might happen.





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