Behind The "Double 11" Of Luxury Brands: The Delicate Balance Between Domestic Market And Brand Promotion

This year's new epidemic situation has an all-round impact on retail, and the passenger flow has dropped by 20% compared with the same period last year. Retailers and brand merchants have even greater expectations for the "double 11" campaign.

An obvious trend is that luxury brands, which are not highly consistent with the "double 11" promotion, have made more efforts to participate in various "shopping Festivals" in the Chinese market this year.

Whether it is brands themselves or by entering various e-commerce platforms, opening up multiple channels, participating in live broadcasting, digital marketing and seizing young Chinese consumers have become the core topics of luxury goods.

The biggest driving force behind the digital strategy is the "V-shaped" rebound of China's luxury market, superimposed with the impact of the epidemic, and the Chinese market has become increasingly important in promoting the performance of luxury brands.

In the "post epidemic" era, the uncertainty in the future is increasing, retailers and brand merchants are in the throes of development. The "battlefield" of "double 11" is the annual key battle of retailers and brands. However, it is a delicate balance for luxury brands to grasp Chinese consumers and expand Chinese market while maintaining brand tonality.

Increasingly active luxury

From November 1 to 11 noon, the turnover of imported commodities of tmall global increased by 47.3% over the same period of last year. Among them, the turnover of 180 overseas brands exceeded 10 million and that of 816 overseas brands exceeded 1 million.

On November 1, in the first 10 minutes, the turnover of Jingdong luxury products exceeded that of last year, with a year-on-year increase of 138%; in the first 30 minutes, the turnover of 127 luxury brands increased by more than 10 times; the turnover of Ralph Lauren, Tod & apos; s, pinko and other brands increased by more than 15 times. Brands such as Burberry have also prepared a variety of categories, 40% discount and interest free promotion for Jingdong's "double 11" campaign.

It is reported that during the global love season on November 11, 2020, there will be thousands of brands and millions of luxury products, and nearly 200 official luxury flagship stores will participate in related activities simultaneously. Bags, clothing, shoes and jewelry become the most popular luxury products. 30 minutes before the opening, the turnover of luxury goods and bags increased by 625%, the turnover of luxury clothing increased by 458%, the turnover of luxury shoes and boots increased by 463%, and the turnover of luxury jewelry increased by 851%.

In order to meet the demand of "buy, buy, buy" that cannot go abroad under the epidemic situation, major platforms have tried more diversified promotion methods. On October 27, tmall Global's overseas direct purchase zone for luxury products was officially launched. Nearly 20000 kinds of global luxury products and fashionable products were gathered in more than 100 overseas warehouses in five regions of the world to prepare for the "double 11" campaign. Behind the "official buyer group" composed of more than 100 tmall international juniors, it serves as consumers in more than 20 countries and regions around the world, such as Paris in France, Tokyo in Japan and Seoul in South Korea“ "Global errands" to buy luxury goods.

In addition to online, physical retail is also another focus of luxury brand "double 11": Yintai department store told the 21st century economic report that during the "double 11" this year, luxury products such as hugo boss, Ferragamo and Versace organized various activities; many Yintai opened luxury goods delivery service; high end consumption represented by wristwatch and beauty makeup increased by 91.2% and 92% respectively in Yintai.

"This year, we continue to see more luxury brands join the event, actively launch discounts, more exclusive products and greater marketing promotion, including star endorsements, launching a large number of short videos and participating in live broadcast." "In our survey, more than 40% of consumers believe that" double 11 "is an opportunity to buy more high-end brands, which is an opportunity not to be missed for luxury goods and high-end brands," Jacques penhirin, managing partner of Aowei consulting, told 21st century economic news

For luxury brands that do not want to let consumers "outflow", the "double 11" is also a very attractive and can not give up "position": for example, on the eve of this year's "double 11", LVMH's e-commerce platform 24s, the world's largest luxury group, officially launched a Chinese version of the website and launched the "double 11" promotion activities. The official website of 24s calls it the exclusive network partner of Louis Vuitton, Dior, Celine and moynat worldwide.

Chinese consumers can not be ignored

On November 6, Aowei consulting released its latest survey. It was found that the epidemic situation had no significant impact on consumers' enthusiasm for participating in the "double 11" campaign. 86% of the respondents said that they would maintain or increase their shopping budget this year. 43% of the respondents said that they would shop in the live broadcasting room this year, but more consumers still focused on big discounts.

In terms of purchasing channels, traditional e-commerce giants such as tmall, Taobao and Jingdong still occupy a dominant position, with penetration rates of more than 80%. Meanwhile, social e-commerce platforms such as pinduoduo, xiaohongshu and wechat are also quite popular with latecomers and become an important choice in the minds of consumers.

The recovery of consumption expenditure after the outbreak is unbalanced, so it is unlikely to follow the pattern of the past, and the scale of different types of expenditure varies greatly. PwC reports that demand for luxury goods and mass brands is polarized. China's luxury market sales have ushered in a "V-shaped recovery.". With long queues of "retaliatory consumption" in luxury shopping malls in mainland China, sales of some well-known brands in China are increasing, which can offset poor performance in other regions.

This is also immediately reflected in the financial performance of luxury brands. On November 6, Richemont group released the results for the six months up to September 30, 2020. The sales volume decreased by 26% to 5.478 billion euro. However, China's sales volume increased by 78%, which almost curbed the decline in the Asia Pacific region and partially alleviated the decline in the European, American and Japanese markets.

Peng Xianlun believes that after several months of retaliatory buying in China's luxury market, demand has normalized and continued to maintain strong growth. With the continuous process of premium / high price positioning and the emergence of new niche brands, people still have a strong interest in international luxury brands. "In the Chinese market, several luxury brands continue to make efforts in the field of accessories, while the momentum of street fashion luxury seems to be weakening."

For brands, Chinese tourists account for 50% of the world's luxury consumption. At present, the only bright spot for luxury brands is Hainan duty-free zone and "double 11" when there are no Chinese tourists (and purchasing agents) in the world.

On October 15, LVMH reported revenue of 30.3 billion euros in the first nine months of 2020, down 21%. But the watch and jewelry business in China began to rebound in the third quarter. LVMH also knows the importance of Hainan duty-free shops when they are unable to go out. On November 10, LVMH's official website summed up the "record" of Dior perfume in Hainan duty-free stores, calling Hainan Island "China's Hawaii" and "has been the central stage of luxury and tourism retail industry in the past few months."

In addition, the price of luxury brands is still rising, and some people pay for it: it is reported that the price of Chanel's classic handbag has risen again in China, from 38100 yuan in May last year to 51500 yuan in November, up 35% in a year and a half.

According to the report of PricewaterhouseCoopers, many middle-class Chinese consumers who previously restrained their consumption desire are now spending more on high-end brands such as Hermes, chanel and Gucci because of their attractive alternative investment and wealth preservation.

This means that China's luxury market is one of the most flexible and best performing markets, and luxury consumers in China are the most important group for brand owners.

At the same time, Peng Xianlun said, "luxury brands need to manage their own brand image seriously and avoid" promotion traps. ". Luxury brands can maintain their high-end and high-quality positioning by launching high-quality short videos and launching exclusive products. Luxury brands should continue to invest in marketing, especially digital marketing, and at the same time improve the in store experience of physical stores to create a complete "offline online offline" integration mode

?