Why Do Big Business People Love The Luxury Market?

After high priced FarFetch, some companies seem to be unable to sit still.

According to the world clothing and shoe net, anonymous people say Alibaba is the biggest in the world.

Yoox Net-a-Porter (hereinafter referred to as YNAP) contacts to seek capital cooperation and does not rule out takeover actions.

Up to now, neither side has responded clearly, and the capital market has given a quick response: the stock price of YNAP on the Milan stock exchange rose nearly 8% that day.

Ladies selling new products for the season

Net-a-Porter and male Mr Porter;

Dealing with Yoox and The Outnet of discount business;

Set up and operate an official e-commerce platform for luxury brands, such as Giorgio Armani and Lanvin.

Taking into account Jingdong's investment of $397 million last week to rival YNAP FarFetch, YNAP, whose overall performance is good, may help Ali tear a hole in China's $80 billion luxury consumer market.

In 2015, Ali invested $100 million in glamour, and launched the glamour shopping channel on Tmall mall.

But glamour benefits belong to luxury discount website, and its performance is mediocre. Ali continues to seek a more high-end market.

Since 2017, Ali has invited Burberry, Calvin Klein, LAMER (La Mer), tiger Heuer, up and down, and so on a large wave of fashion and luxury brands to Tmall, and also bought Burberry, Gucci and Michael Kors.

Whether Ali and YNAP cooperation is true, from Ali and Jingdong in the past year, the fashion attracted luxury performance, they are eager to get rid of the "affordable" and "cheap" label, and move towards a tall road.

Luxury goods in Europe and the United States sell at a high price in China. Many Chinese consumers are more willing to buy or buy overseas. The ten thousand yuan package can save three thousand or four thousand.

In 2016, the Chinese bought nearly half of the world's luxury goods. Over the past 5 years, over 70% of luxury purchases took place outside China.

However, with the downward trend of consumption, the depreciation of the RMB, and the recent Chinese government's promulgation of a series of policies to stimulate consumption, the import tariffs on clothing, shoes, skin care products, cosmetics, perfume and other categories of commodities have been lowered, and the prices of the major luxury brands in the mainland have declined.

Past "shopping paradise" Hongkong, Macao, Japan and South Korea lost the price advantage of non local brands.

Zhou Ting, a luxury industry observer, conducted a sample survey and found that compared with 2011, the overall average price difference between domestic and overseas luxury goods in China decreased from 68% in 2011 to 16% in 2017. The difference narrowed by 52 percentage points, which is only one thousand yuan in the purchase of tens of thousands of luxury goods. Considering the factors such as after-sales service and round-trip fare, the price can be accepted by most consumers.

In the second half of 2016, sales of LVMH in mainland China increased. LVMH CEO Bernard Arnott also pointed out that Chinese consumption will return to the mainland market.

These luxury consumers have long squatting on the mobile Internet, bringing opportunities to domestic electricity suppliers.

According to the survey by the Fortune Research Institute for 3726 luxury core consumers, assets of more than ten million yuan, the average time spent on mobile APP is 1.7 times that of ordinary people, mainly for business and social networking, but shopping and lifestyle attempts have gradually become a trend.

McKinsey's annual report on the luxury digital marketing observation predicts that the online market share will double to 12% in 2020 and 3 times to 18% in 2025, and e-commerce becomes the third largest luxury market in the world after China and the United States.

Online prosperity is a foil to the loneliness of the luxury market.

According to the data of Paris bank and RE Analytics, 2016 of the global luxury goods stores were intensified in the first quarter, and the total number of eight mainstream luxury brands closed nearly 40, while luxury brands only kept the iconic store under the shrinking line.

The era that shops can earn money is gone, luxury brands turn to online, but the question is which kind of electricity supplier to choose?

Generally speaking, luxury brands have a slow acceptance of the electricity supplier. The comprehensive electricity supplier has a large volume and a high exposure rate, which reduces the brand value.

A reporter once reported that L2, a digital marketing agency in New York, believes that most of the current luxury brands can be trusted by vertical third party platforms, such as Farfetch and Net-a-porter.

These vertical businesses know more about the hearts of luxury consumers.

In April this year, Farfetch and Gucci co operated exclusively in the 10 cities across 4 continents and launched the delivery service after the order was sent 90 minutes later.

In the evening, you have to attend an important dinner. You only need two hours in advance to get your dress and accessories.

The service of Net-a-porter is to let consumers make a "God". The service named "You Try We Wait" is delivered to the door by private guide buyer on the same day, until the consumer tries to wear out the shopping guide before leaving. If it is not satisfied, the consumer can bring the product back to the shopping guide on the spot.

However, China's electricity providers like to fight price wars. The big sale of "buy one get one" and "9.9 guarantees" can hardly match the tonal of luxury brands: craftsmen elaborate, unique and expensive.

These discontent lies in the hearts of luxury brands.

L2 recently surveyed 87 luxury goods, and found that only 24% had official shops on Tmall, only one percentage point higher than last year, while only 10% of Jingdong's luxury brands had official stores.

Ali is also due to the flooding of Taobao's fake products without being seen by luxury brands.

When the confrontation between the two sides was most intense, luxury brands such as MichaelKors, Gucci, Tiffany and so on demanded that Ali withdraw from the national anti fake alliance.

Although Ali has organized a big data counterfeiting alliance, Tmall has been upgrading to be a quality led business operator, trying to reverse stereotypes, but still can not get all the luxury brands.

"Ali is now thinking about other ways to solve the problem that the brand does not want to open shop in Tmall, that is to cooperate with other retailers."

L2 Asia Pacific Research editor Liz Flora explains.

YNAP has been established for 17 years and has a high reputation in the industry, which may be a good choice.

The business people are playing more and more luxurious brands, and those unreachable luxury brands may be changed from "no money to you" to "look at it, save it and you can afford it".

More interesting reports, please pay attention to the world clothing shoes and hats net.