As young Chinese consumers become more and more discerning in their tastes, many Western luxury labels are struggling to gain — or maintain — brand loyalty in China. Simply being internationally known is no longer enough and has even shown to hinder a brand’s popularity among the young and unique. Youthful consumers are seeking luxury goods that relate to them and their lifestyles and personify the style tribe in which they seek to belong. For many, this has meant turning to domestic luxury brands that are able to unify the concepts of both cultural nostalgia and modern rebellion.
Alongside this struggle, established luxury brands are having to contend with an almost universal desire for streetwear over the luxe and traditional. So how can Western brands survive in this changing luxury climate? Diesel’s founder, Renzo Rosso, is forging the way, having globally rejuvenated the well-known denim label in 2019.
In March 2019, Diesel filed for Chapter 11 bankruptcy protection in the US and began a huge overhaul in an attempt to attract a new generation of streetwear-loving sneakerheads. Arguably the first step to redemption is recognizing the problem, and other traditional brands might do well to take note. Markedly, the relaunch included a big focus on China, following the opening of Diesel’s direct Chinese e-commerce website and a celebrated launch on the shopping giant Tmall. Diesel has focused on bridging the gap between global and local by working with local designers, artists, and ambassadors to promote its brand across mainland China. At Shanghai Fashion week in 2019, the brand opened a special customization showroom featuring art by the zany and rebellious Chinese contemporary artist, Chen Tianzhuo, and a capsule collection in collaboration with Chinese designer Xander Zhou.
Diesel has also kicked off 2020 with the announcement of a collaboration with the Shanghai and Milan-based label Pronounce, founded by designers Yushan Li and Jun Zhou. Some of the 18-piece, unisex ready-to-wear and denim collection was previewed on January 4th at Pronounce’s London Fashion Week Men’s runway show. The full unveiling of the collection will take place during Shanghai Fashion Week and will hit stores — in China and at flagship locations worldwide — in late March.
But will all this be enough to attract savvy Chinese shoppers? Renzo Rosso spoke to Jing Daily about Diesel’s plan in China, and why he thinks they’ve really got a shot.
: With Diesel returning to growth worldwide, what is your plan for targeting the young Chinese market?#
Renzo Rosso: Currently, Diesel has 56 stores in Greater China, with 12 opened in the last six months alone. In the next six months, we will be opening 12 to 15 more, taking the final count to about 70 stores in the region. The basis of our growth in the region is this strong retail development and an important increase in our online business. In addition, we have already begun to target 2nd and 3rd tier cities in China and will continue on this path in the next few years.
Our collections are designed globally but when developing them, we travel the world, including China, and we work hand in hand with our local teams to ensure market specifics are considered and looked after. Our male and female collections speak to international, open-minded, fashion-conscious but not fashion-victim consumers — well informed and with a distinct personality that they also want to express by the way they dress.
Considering your presence on platforms like Tmall, what does your e-commerce strategy look like for the Chinese market?#
E-commerce is a key growth channel for us as it allows us to reach all corners of a massive country like China. In 2019, our online business increased by 166%. Currently, Tmall is our most important partner but we are working also with different platforms and operators. We are also excited to say that 2020 will see the launch of our official WeChat store.
We strongly believe in localization and working with individual markets in order to not impose on them what we are doing in other parts of the world. This is crucial. So far, our collaborations in China have been successful because they have been so carefully planned and thought out. Even before our relaunch, most of our collaborations in China sold out and generated lines outside of our stores like the extremely successful capsule collection we created with Chris Lee in 2017.
How much economic worth does China represent for you as a company and how do you see this trajectory going?#
China is still a relatively small part of our global business, but it is the region with the highest growth rate. Apart from the retail and e-commerce developments mentioned before and a series of locally relevant special projects, we are investing heavily in communications respecting the culture and the values of the country and its people. Instead of ‘buying’ celebrities and talents, we work with them; we engage their creativity in our brand universe in new and surprising ways. And this latest collaboration with designer duo Pronounce is a great example of this.