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    Luxury Retail Giant Has Suffered Heavy Setbacks

    2013/11/2 10:25:00 35

    LuxuryRetailElectricity Supplier

    < p > Messi stores hope that in China, the new a href= "http://www.91se91.com" > market < /a > relies on the electricity supplier to attack the city, but the wrong decision will eventually collapse.


    < p > according to McKinsey's report, China accounted for 25% of the total global luxury consumption in 2012, and this ratio will increase to 34% by 2015.

    More and more people began to buy luxury goods online.

    According to a report published by Observer Solutions, a market research and consulting firm, China's luxury e-business market turnover increased rapidly from 6 billion 400 million yuan in 2010 to 18 billion 900 million yuan in 2012, and it is expected to reach 27 billion yuan in 2013.

    < /p >


    < p > but obviously, this cake is not so easy to eat.

    In October 14, 2013, Messi, a retail giant in the US, announced that it was suspending its expansion plan in China because it thought it needed to know more about Chinese consumers.

    "In the long run, we are interested in the international market, but there is no plan for further expansion in China."

    Messi Jim, senior vice president of department store, said Sluzewski.

    < /p >


    < p > Messi's department store has a great ambition in the Chinese market.

    In May 2012, it entered the Chinese market by injections of $15 million into the local flash buying website Jiapin net.

    According to the original plan, it should have turned Jiapin net into Messi's department store e-commerce website in China in June 2013, selling positive price instead of discounted goods.

    But these failed to come true.

    < /p >


    < p > Messi is not the only high-end department store magnate who gets "bad news".

    Niemann Margo, also from the United States, had just had a similar experience several months ago.

    < /p >


    In March 2012, Niemann also opted to inject $28 million into China luxury online < a href= "http://www.91se91.com/news/index_c.asp" > retail < /a > glamour site, and launched his e-commerce website at the end of 2012, and set up an operation center and warehouse in Shanghai by Glamour's localization advantage.

    In March 2013, Niemann held a spectacular brand show in the Bund. He also invited the director of global marketing, Ken Downing, to help.

    However, a few months later, it quietly and hastily laid off more than half of its staff and closed the Chinese warehouse. Lindy Rawlinson, the general manager of China's operations, also withdrew to the United States.

    It is reported that Niemann has also cancelled many brand orders worth millions of dollars, including several well-known luxury brands.

    < /p >


    < p > "in China, the most likely mistake for foreign brands is not to rush in, but to slow down."

    Kelland Willis, Forrester e-commerce strategist at market consultancy, said this analysis.

    Messi and Niemann obviously belong to the former.

    < /p >


    < p > excessive urgency makes Messi and Niemann make a clear mistake in making the first decision in China: choosing discount websites as partners.

    It seems that this is a shortcut: these websites have accumulated a certain amount of traffic and have a complete set of team and business models.

    < /p >


    < p > discount website oriented customers are totally different from those of Messi and Niemann's location customers. Those consumers who frequently pay attention to and buy large discount products on the Internet are not their target consumers.

    At the same time, discount websites are hard to attract high income groups who are more sensitive to brands than price.

    Their demand for online shopping experience is similar to that of a physical store, and this is exactly one of the major challenges facing luxury goods in e-commerce.

    < /p >


    < p > according to McKinsey statistics, in 2012, 8% of online buyers bought luxuries, and the Internet is only a channel for most people to understand brands and products. People are more willing to buy them in stores with leather sofas.

    International experience is online and offline sales integration, online display, physical stores provide shopping experience and services, and in China, this piece of time has not yet been given enough attention.

    < /p >


    < p > in fact, not only is the development of luxury retail giants in China blocked, but foreign luxury electric providers are also unsatisfactory when they enter China.

    As early as 2010, Italy luxury electric business listed company YOOX officially entered the Chinese market, but three years ago, YOOX is still worried about how to build brand awareness.

    At present, YOOX can only maintain its two online sales platform operation Yoox.com and Thecorner.com.

    Jenny, a staff member who once worked in YOOX China, said: "users are not used to buying products on our sales platform, and our main source of income is to help brands operate e-commerce websites under their brand names."

    < /p >


    The P group has also been very optimistic about online sales of luxury goods in China. Last year, Net-a-porter, a group of British electricity supplier companies, successfully acquired an electronic business platform "familiar guest network" founded by Hongkong fashion legend Guo Zhiqing, and changed its name to "outlets" in China.

    Although this incident has received wide attention from the public, it has been proved later that this acquisition is not a strategic value in essence, because the business activities of "familiar customer network" in mainland China are almost zero, and the market performance of the first year of its operation is also strong.

    < /p >


    In March of this year, Net-a-porter began to operate the official version of the Chinese version of the main page. However, the online sales service of the website not only does not support the most commonly used payment methods such as the union, cash on delivery, and so on, and even does not accept renminbi pactions at all. P

    "The prospect of the Chinese version of Net-a-porter is not optimistic. After all, Chinese people who use international credit cards are still few."

    "Unless these multinational e-commerce companies can eliminate these barriers and improve the customer experience of Chinese consumers, it will be difficult for them to develop well in the mainland," said Lu Zhenwang, an industry consultant.

    < /p >


    Apart from its own reasons, strong competition from luxury electric providers in China is also a major obstacle to further expansion of these multinationals in China. < p >

    China's luxury e-business website started in 2008 and exploded in 2010.

    In 2010, there were more than 50 new luxury e-commerce websites, and the main business was basically similar. The growth of luxury e-business reached a peak.

    However, with the collapse of the ordinary scale e-commerce website in 2012, fewer than 5 local e-commerce enterprises survived, most of them have the support of large-scale venture capital or private equity funds.

    Nowadays, the domestic luxury business enterprises that have survived the most difficult period are actively seeking more consumers through advertising marketing.

    < /p >


    Less than P, the latest figures from domestic fashion and < a href= "http://www.91se91.com/news/index_s.asp" > luxury goods < /a > e-commerce website show that the exclusive authorization of Italy's top luxury brand Ferragamo was authorized in 2012. By the end of September this year, Ferragamo's sales in the show network had doubled 15 times.

    The first quarter net profit of vip.com in the 2013 fiscal year a year ago in the US was 5 million 800 thousand US dollars, compared with a net loss of 8 million 600 thousand US dollars in the same period last year.

    Ju Shang network also set up its own storage base in Huzhou, and the volume of orders increased by 63% over the same period last year.

    < /p >

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