When it comes to luxury brands’ digital presence in China, not all strategies are created equal, according to a new report by digital intelligence firm L2. While many high-end fashion, watch, jewelry, and leather goods companies are lagging at attracting Chinese followers and online shoppers, the firm finds that Hong Kong jeweler Chow Tai Fook is China’s most digitally competent brand in 2016.
The “Digital IQ Index” ranking of 107 luxury brands in China finds that Burberry, Coach, and Cartier have the second, third, and fourth best China digital strategies after Chow Tai Fook, respectively. Calculated with a methodology that analyzes brands’ websites, e-commerce, digital marketing, social media, and mobile presence, the report finds that the majority of brands have “average” or worse China digital strategies, with more than three in five brands classified as digitally “challenged” or “feeble.”
For brands that are succeeding online, however, e-commerce plays a key role. While luxury labels have been known to avoid selling online in fear of losing exclusivity, they’re warming to the idea as 80 percent of brands studied by L2 are now available for purchase online in China. A solid e-commerce strategy was a reason for Chow Tai Fook’s high ranking on this year’s list, as the brand is active on both the Tmall and JD.com platforms, allowing it to control all first-page brand search results on both platforms—giving it a strong edge over gray-market and counterfeit sales. Burberry, which is also on Tmall, was able to shine on social media as well when it allowed followers to pre-order personalized items directly from its runway livestream video—a move that caused a major stir in the global fashion industry. And after a lackluster start on Tmall that fizzled out several years ago, third-place Coach followed in the footsteps of Burberry and reopened its Tmall store with participation in Singles’ Day for 2015.
SEO success on Baidu was also key for top sites’ rankings this year. The report finds that Chow Tai Fook’s SEO strategy has caused it to rank highly on Baidu when users search for many top jewelry-related keywords, while Burberry is also “aggressive” in its Baidu keyword advertising for specific fashion terms such as “cashmere poncho.”
The most digitally competent luxury brands were also successful in carrying out massively viral campaigns on Chinese social media. Chow Tai Fook’s O2O “Marry Me” campaign, which allowed customers to compete for a free planning and video shoot of a marriage proposal, resulted in 18 real marriage proposal videos posted to the brand’s Youku site that received an average of six million views each (the most popular proposal received over 14 million views). Meanwhile, Burberry’s decision to use Chinese celebrity Wu Yifan (吴亦凡) for its 2016 Fall/Winter Menswear fashion show “broke the Chinese internet,” according to the report, which resulted in both viral sharing and extensive media coverage.
In addition, Cartier stood out for its digital efforts to reach Chinese tourists traveling abroad, a vital segment that is often overlooked by luxury brands in their WeChat marketing strategies. The jeweler uses a product translation tool as well as overseas geolocator in WeChat that allows users to make reservations at stores across the world through the app, ensuring that jet-setting VIPs are taken care of regardless of what city they happen to be in that week.
When it comes to brands that didn’t hit the mark this year, the problems were endless—including issues like failing to have a Chinese mobile site, staying off WeChat, having too many “zombie” followers on Weibo, launching customer service sites with too many bugs, and many more.
Although the majority of brands in this year’s report weren’t praised for their digital prowess, L2 says things are improving: fashion brands’ “digital IQ” scores in China have increased 33 percent since 2014. In addition, the number of brands listed as having a “feeble” digital presence in China declined by 40 percent as a growing number up their digital game by launching e-commerce and WeChat accounts.