What happened
The French-headquartered, Chinese-owned accessible luxury fashion retailer SMCP has reported a healthy boost in Asia-Pacific sales, largely on the back of mainland China during the third quarter. SMCP is the parent company of Parisian brands Sandro, Maje, Claudie Pierlot, and De Fursac. Reported sales were down 9.5 percent with consolidated worldwide group sales of $293.7 million. In the APAC region, however, sales were up 13.8 percent on an organic basis mainly driven by mainland China and up 29.6 percent of organic growth including a double-digit like-for-like sales growth. Given this, the group announced its five-year strategic plan with a focus on China. SMCP will also increase its marketing investments with a strong focus on digital media to reach a new generation of Chinese customers, as well as a further digital boost and expansion in key new Chinese cities. By 2025, SMCP envisions APAC to contribute to 50 percent of the Group’s growth.
Jing Take:#
Back in 2016, the Shandong Ruyi Technology Group took a controlling stake in SMCP. The marriage looked to combine the French firm’s fashion know-how with Shangdong Ruyi’s business network in China. Today, SMCP has over 200 stores in mainland China and will continue to add the network with at least 20 new stores a year for the foreseeable future. As part of the group’s digital media strategy, aside from cooperating with e-commerce platforms like Tmall, WeChat ,and Little Red Book, SMCP is exploring gamification, where users can dress their game avatars with clothes from Sandro or Maje. Commenting on their future plans, SMCP’s CEO Daniel Lalonde told Jing Daily: “We love the Chinese market and we plan to secure 30 percent of our total sales in APAC by 2025. We want to be the leader of accessible luxury industry with our unique and niche Parisian women style.” By targeting this growing market sector of Chinese consumers looking for “accessible luxury” products, SMCP is betting on meeting this demand with their off-line and on-line expansion. But the question remains: can they develop the right marketing strategy for this market?
The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.