Does Chinese Retailer Bosideng Have A Chance In London?

Expansion Highlights Global Ambitions Of Chinese Brands And Massive Challenges Virtually unknown outside of its native country, where it operates over 10,000 retail outlets, on July 26 the Chinese retailer Bosideng is set to open its first overseas flagship in London, located on the city's swish South Molton Street. A first for a Chinese clothing label of Bosideng's size -- though Chinese sportswear maker Li Ning opened a short-lived outpost in the US -- the brand's moves illustrate an interesting dynamic in the international world of fast fashion: As major international players like Zara, H&M and Uniqlo dig deeper into the mainland China market, mainland Chinese retail powerhouses have their sights set on expanding abroad. This doesn't mean that Bosideng's journey to the West will be a carbon copy of the domestic strategy that made it "big in China." As Jing Daily noted in May, the brand hopes to go (or appear to go) more upmarket, with the majority of the products stocked at Bosideng’s new London location to be manufactured in Italy, mainland Europe and China. Designs for the new store have been created in collaboration with Nick Holland and Ash Gangotra, who previously worked with former Oasis frontman Liam Gallagher and his label, Pretty Green. Though the company currently has not yet detailed further European expansion plans, Bosideng UK chief executive Wayne Zhu said, “A move into Europe has been a goal of Bosideng for some time, and we’re very excited to be launching in such a prominent location in London.” As Zhu told the FT's Beyondbrics blog this week, the company also hopes to open a New York location, but "the right Manhattan location has yet to come available.” According to Zhu, Bosideng hopes that its overseas locations will contribute around five percent of group revenue. Considering his brand is unheard-of to nearly all in London but overseas Chinese students or tourists, to call this ambitious is a true understatement. Much of Bosideng's potential in the London (or European, or American) market will come down to three core questions: One, how will it position itself, price- and segment-wise? Priced too high, Londoners and visiting Chinese tourists will opt for established domestic or European brands. Priced too low, they'll opt for known entities like Zara, Marks & Spencer, or the Gap. Two, will potential customers be turned off by the brand's somewhat awkward-sounding name? Three, what kind of online presence will the brand have? Compare the look and functionality of Bosideng's official website or London site to those of high street retailers like Uniqlo and H&M or high-end brands like Louis Vuitton and Dunhill. Aside from being attractive, user-friendly, and highly integrated with social media, these sites embody the look and feel of each brand. Bosideng has yet to even officially launch in London, yet its online persona isn't doing the brand any favors with any potential customer who logs on to look into it. So does Bosideng really have a chance outside of China? Possibly. But not because of domestic British shoppers. At the moment, the brand is more likely to see its customer base be mostly made up of London-based Chinese nationals, overseas students and visiting tourist-shoppers. But, if the brand manages some clever marketing, refocuses its online presence, and follows the Uniqlo school of positioning an unknown Asian brand as a cool alternative to established Western names, it might have a fighting chance to pay its sky-high London rent and eventually stride into continental Europe. Otherwise, it might turn out to be a very expensive lesson in overseas retail for Bosideng (and a valuable case study for other ambitious Chinese brands).

Does Chinese Retailer Bosideng Have A Chance In London?

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Published July 19, 2012

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Does Chinese Retailer Bosideng Have A Chance In London?