The tech market in China continued to shift in 2019, presenting a big challenge for luxury brands that wanted to reach Chinese consumers through digital channels. With Chinese consumption habits maturing, brands must work harder to understand exactly how consumers are using social media and other tech platforms in China.
The influence of Chinese social media powerhouses like Weibo and WeChat held strong this year, while other platforms like Little Red Book faced hurdles. New native companies like the re-commerce platform Plum entered the market, crowding the field for competitors such as TheRealReal. Elsewhere, Chinese tech giant Tencent doubled down on its luxury advertising strategy by partnering with a group of notable brands that included Burberry and Gucci.
Below, in reverse order, are Jing Daily’s top-6 China tech moments of 2019. For more of our 2019 year-in-review analysis, read on here.
In November, Burberry and the Chinese technology powerhouse Tencent announced a plan to develop social-media retail across mainland China. The first step of the partnership will be for Burberry to open its first “social retail store” (powered by Tencent technology) in Shenzhen. The store is expected to open during the first half of 2020 in the new MixC Shenzhen Bay development. According to Burberry, this will be a unique space that will serve as a laboratory for testing innovative ideas that will ideally expand out to the rest of the Burberry network in China. Read more
In November, this year’s Alibaba Singles’ Day Shopping Festival generated $38.4 billion (268.4 billion RMB) of gross merchandise volume, as reported by Alibaba. This is an increase of 26 percent compared to 2018. This year’s shopping extravaganza featured 200,000 participating brands, one million new product launches, and 1.3 billion delivery orders, and livestreams on Taobao contributed to a boost in sales for new entrants, such as Kim Kardashian’s KKW Fragrance. Read more
In September, the online fashion retailer Net-a-Porter and its men’s site, Mr. Porter, opened a shop on Tmall. They’re offering over 130 luxury and designer labels as part of a major deal that their parent company, Swiss luxury group Richemont, signed with Alibaba last year. Luxury brands of note that now sell on Tmall include Valentino, Versace, Isabel Marant, Coach, Bottega Veneta, Givenchy, and Burberry. The turnabout illustrates how the fashion industry, which once eyed Alibaba with suspicion, is now flocking to the site, as it’s the best way to reach China’s luxury-hungry shoppers. Read more
In August, Beijing start-up Plum (a second-hand luxury resale app) achieved its Series B round of financing this August, collecting $20 million from a group of VCs that includes China-based Matrix Partners China and Qiming Ventures. Founded in 2017, the platform has made a big effort to educate China’s consumers about the second-hand luxury market. Featuring a similar consignment and resale model to U.S.-based luxury reseller The RealReal, Plum is one of the few Chinese resale e-commerce sites specializing in luxury apparel and accessories. Read more
In July, the much-hyped social commerce platform Little Red Book (Xiaohongshu) was suspended from the Android store. The news spread like wildfire on Weibo, with over 900,000 discussions. Many netizens were not surprised and criticized the platform for being poorly managed and stuffed with fake reviews and paid ads. Some also complained that the quality of the posts has gone down since its launch. Read more
In March, LVMH staged The Inside LVMH program in China and launched a WeChat Mini Program inviting Chinese youth to discover the depth and breadth of the company’s expertise. In the Mini Program, users were able to listen to LVMH employees talk about their experiences and sign up for the offline event “Discovery Day,” which allowed aspiring students to interact with top LVMH executives and share fresh ideas for the future of retail. Within two weeks, LVMH’s WeChat Mini Program triggered 9,500 registrations. and over 1,500 students shared their written or video submissions for the brand’s “Client Experience of Tomorrow” talent call. Read more