Can luxury fashion crack China’s booming AAA video game market?

Thirty or so years ago – in a time of less diversity, equity and inclusion – the luxury fashion industry was wrestling with the rise of hip-hop music. Should brands embrace it? Some even worried the association would dilute their prestigious image. The same dilemma emerged around the 2010s when streetwear was taking off in the mainstream. Was it okay to put sneakers and hoodies on runways? Ultimately, the answer was a resounding “yes.” But it took a few early movers and cult figures to get the rest on board. For the past five to 10 years, the same thing has been happening around gaming. Early adopters like Gucci and Balenciaga have dedicated teams that deal with a breadth of gaming initiatives. Instead of one-off stunts, gaming has become an ongoing channel for these luxury houses, in the same way that hoodies and sneakers are a staple in luxury fashion collections and hip-hop artists regularly show up across their campaigns and shows. Hip-hop and streetwear were born in the US and still dominate in terms of market size. Gaming (despite emerging in the US) has given rise to other cultural and commercial behemoths – namely in China. Let the games begin According to Goldman Sachs, China’s video game market is set to reach $45 billion in size. Yet, as reported by Jing Daily earlier this year, the opportunity hasn’t been fully seized by luxury fashion brands. There are certainly some great cases with mini-games popping up across QQ and WeChat alongside local fashion shows and campaigns. But when it comes to Triple-A games, that traction has been slower. Honor of Kings is maybe the exception here, but only by a few accounts. The multiplayer online battle arena (MOBA) maintains a daily active user (DAU) count of 100 million players. That makes it the No. 1 game globally in terms of DAUs. To put that into perspective, Roblox – a game that has luxury fashion brands like Gucci, Givenchy, Coach and many more regularly creating experiences inside it – has just 79.5 million players. Of course, reach isn’t the sole success metric for brand partnerships, but Honor of Kings has only managed to attract Western brands like Burberry and Bvlgari in the past. And yes, both of these became politically controversial in China, but that shouldn’t deter others, especially because Honour of Kings is by no means a China-exclusive game. It has huge audiences in South Korea, Japan, Europe and the US. Popular plays Honor of Kings is the most obvious example, but what about Genshin Impact, or the recent explosion of Black Myth: Wukong – two games that have attracted substantial global fanbases? Moreso, how should luxury fashion brands start thinking about getting into these games? “Everything starts with this question: What value am I adding to this game, and vice versa, what value is it adding to my brand?” says Megan Cheong, account director of metaverse data platform Geeiq. Cheong frequently works alongside some of the biggest luxury fashion brands (i.e. Gucci) on their gaming activation strategies. Normally, Cheong says, the answer takes two forms. The first is virtual. In games like Honor of Kings and Genshin Impact, this route makes more sense. Both games are free to play (F2P) and are non-linear in their narratives, meaning they sell a lot of in-game items for players to style and advance through the game. This makes less sense for a game like Black Myth: Wukong, a linear game set in a period before most luxury fashion brands existed. “The game follows an ancient storyline about the Monkey King. So, brands would need to find something extremely authentic, or do something with hyper self-awareness, almost making a joke out of it,” says Cheong. The former actually could work for a brand like Loewe, which has a proven record of referencing ancient Chinese craft. The latter path around humor risks provoking local netizens in China when it comes to cultural heritage. That hasn’t stopped some modders (i.e. enthusiasts who alter the code of games to change gameplay or aesthetic) from putting CJ from GTA San Andreas in the game, but “understandably that is something luxury fashion brands are less interested in doing,” says Cheong. Value can also be added in physical form. “Most game publishers completely lack the physical component that luxury fashion brands have. On a practical level, that’s something that can be seen as a great added value for the publishers and their games’ fandoms,” Cheong adds. Cross-industry collabs Honor of Kings, Genshin Impact and Black Myth: Wukong have all experienced the benefits of this, yet none pertain to luxury fashion. Though other sectors have proven lucrative; Honor Of Kings, for instance, had major success through its Mac Cosmetics collaboration, which released lipsticks and makeup palettes inspired by the most popular characters of the game. The tie-up worked largely because Honor of Kings on its own would not have had the credibility (or resources) to create makeup collections. Fashion can provide that same credibility. Imagine one of Genshin Impact’s famous characters like Raiden Shogun had a collection from Heaven By Marc Jacobs. Their aesthetics have enough alignment to warrant crossover, but enough difference to innovate. After all, the most impactful collaborations strike the perfect balance between surprise and sense. The best luxury fashion and video game partnerships blend the physical and the virtual seamlessly. Perhaps one of the best recent has been the Overwatch 2 x Gentle Monster collaboration, which introduced both digital and physical glasses, in-game skins and filter challenges on TikTok. These types of dynamic partnerships stretch to different corners of the consumer spectrum – for example, the fashion-adjacent consumer of Gentle Monster might prefer the filter challenges and physical glasses while the gaming-adjacent consumer of Overwatch 2 may prefer the skins. Alas, many luxury fashion brands still resist these partnerships. It’s understandable that luxury fashion brands are skeptical about the commercial viability of partnerships with Chinese AAA titles when restrictions around gaming hours and investment seem to be tightening. But the impact of these partnerships extends beyond Chinese borders. All three games discussed have growing audiences outside of China, from both the Chinese diaspora and non-Chinese gamers. Luxury fashion brands should consider partnerships that respect the IP of the game publisher and leverage a mix of physical and virtual touch points. Just as hip-hop and streetwear have proven themselves as valuable contributors to the luxury fashion space in China and beyond, gaming offers a similar runway. It just needs the right strategy.

When gaming meets luxury fashion

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When gaming meets luxury fashion