How Do International Luxury Brands Invade China'S Online Shopping Market?

In 2010, China's online shopping retail market reached $49 billion (including B2C, C2C), ranking only second in the US, and even 45 billion in the online shopping market.

"I can tell you that online shopping accounts for an average of 1%-2% of brand sales, and we think that this percentage will expand to 3%-5% in the next few years.

The reason for the low proportion is that the online shopping for luxury goods is still a new thing, and many brands have just been online for a couple of years.

Managing online stores for multiple luxury brands

Localization of international brand online experience

According to the update report of Bain and Fondazione Altagamma2011, 2010 has become a peak of luxury consumption. Mainland China is still the fastest growing area of sales. Consumers are more and more professional and mature, and have more detailed requirements for products.

"Diversification is the main theme of these ten years. Market segmentation and diversification of channels will be the main means to achieve this goal," said Claudia D 'Arpizio, a partner of Bain.

In the Chinese market, Louis Vuitton, Fendi, Chanel and other first-line brands have already launched localization.

Until November 2010, emporioarmani.cn was launched; in March 2011, marni.cn was online.

Since then, Chinese netizens have seen more than just the "Sinicization" of the international community.

And behind this is the YOOX group founded by Italians Federico Marchetti in 2000.

Globally, YOOX has entered into a strategic partnership with 25 major brands, and has set up the official flagship store for the brand, most of which are world-renowned brands such as Gucci, Zegna, Dolce&Gabbana, Bally, Y-3 and Jil Sander.

Recently, the founder of YOOX, Federico Marchetti, came to Shanghai to inspect Shanghai operation center.

In order to provide a comprehensive localization shopping experience for Chinese consumers, YOOX group has been operating in China. The local office in Shanghai is responsible for the operation of commodity circulation, network marketing, customer service and network maintenance. The logistics center in Shanghai is responsible for digital photography, cataloguing, inventory management and pportation.

Take the latest official flagship store in China, BALLY, for example. Www.bally.cn, the first official flagship store in China, officially opened the Chinese market in May 4th and operated by YOOX group.

The online store has continued the brand style shop's consistent style, displaying and selling all the products of Ms. Bally and men's series, including bags, shoes, accessories and ready-made garments.

In addition, it provides Chinese customers with creative and convenient visual shopping experience and comprehensive localized customer service: including scale conversion, easy replacement, etc.

"Next year, YOOX will help three to four single luxury brand online flagship stores in China."

Marchetti revealed.

Marchetti is not worried that these strong high-end brands will take their own actions after the maturity of online shopping, just like the general practice of reclaiming agency rights in the global physical retail market. "Last year, we invested ten million euros in R & D and social development.

This year, just a month ago, we announced an automated logistics platform project worth twenty million euros.

Because of our scale and volume, we can achieve more efficient, professional customer service and goods pportation.

For a single brand, it is difficult to make such a huge investment. If the brand wants to do it itself, it will be distracted and inefficient.

"We hope that the Chinese market will become the third largest market of YOOX group in five years."

Marchetti is ambitious to reveal his blueprint for planning in China.

"Next spring, we will open up special zones for high quality Chinese designers and sell them in thecorner.com."

But the name of the Chinese local designer, he refused to disclose, "is still a commercial secret."

Multi brand shopping platform

Unlike the strategic partnership between YOOX and every single luxury brand, the online shopping experience of more luxury brands is achieved through multi brand online shopping platforms, such as the Neiman Marcus of the United States, Net-a-porter of the United Kingdom, Vente-privee of France and the charm of new entry into China www.glamour-sales.com.cn.

However, Net-a-porter, a leader, has not made specific moves against the Chinese market, even if it is simply plated into Chinese website, or localized by logistics and customer service, which is still a traditional online shopping mode of "overseas mail order".

The move to enter the Chinese market was slow, and YOOX, which was also founded in 2000, took the lead.

In addition to brand management and profit from sales commission, YOOX is also building its own fashion empire.

Although its most anticipated brand discount store yoox.com has not yet entered China's plan, many brand online store thecorner.com, which runs many fashion brands that have not yet entered China, is coming to China in the second half of this year.

"Every market has its own pricing, because we need to keep in line with our local stores, so as to ensure that we do not make ourselves a competitor in the store."

Marchetti, as the helmsman of YOOX, naturally has a plan to win short-term profits in the emerging market by sacrificing its brand image because of its discount brand strategy in the mature market. "Cooperation with brands means sharing all the information with each other. We have no less than 4 years' cooperation plan for the online store established by a single brand. All the plans are based on long-term development strategy."