World Department Store Forum Taking Place June 9-10 In Shanghai
Department store executives from around the world converged on Shanghai today to discuss the state of the industry and the growing influence of Chinese consumers. At this year’s “World Department Store Forum” (June 9-10), organized by the Bailian Group (百联集团) and the Intercontinental Group of Department Stores (IGDS), attendees shared some of their favored techniques for tapping the spending power of Chinese shoppers–a topic of greater importance not only for department stores, but also standalone luxury boutiques.
Speaking on his observations about what makes Chinese shoppers “tick”, Paolo De Cesare, CEO of the French department store Le Printemps, said that his company takes a multi-pronged approach to Chinese customer service, which encompasses everything from store design to product innovation. In addition to a three-floor LV flagship that has become something of a Mecca for Chinese tourists, De Cesare said that Le Printemps has created Chinese-language maps, put together a tax rebate scheme, and worked with luxury brands like Chanel to create special ruby-colored handbags aimed at Chinese shoppers. Additionally, De Cesare said that his company recently arranged a trip for a group of 70 high net worth Chinese, which included personalized shopping, leisure and travel services. This kind of “custom service”, De Cesare said, has “locked in the loyalty” of Chinese VIPs to Printemps. The response to this level of attention is, according to De Cesare, one of the driving forces that has seen Chinese tourist-shoppers hold the distinction as the top foreign consumer group in Paris since 2008.
ESCADA CEO, Bruno Salzer echoed De Cesare’s enthusiasm for the Chinese consumer, saying that China isn’t the future for luxury luxury brands, it’s the present. Discussing his brand positioning strategy for the China market, Salzer said ESCADA isn’t only targeting Beijing or Shanghai but is digging deeper into second-tier cities. Currently operating 50 locations in China, Salzer said ESCADA plans to surpass 100 stores by 2015. However, as Salzer and other speakers were quick to point out, the China market is far from a cakewalk. Though the consumer base may be growing quickly, and sales are racing ahead, customer service is a nagging problem. According to Salzer, good staff is one of the key factors in a brand’s “soft power”, and as such sales and customer service training is critical.
Other speakers at the event today discussed the importance of product design that is more in line with what Chinese customers actually like. “Once we had a foreign designer who stuck a dragon on a Li Ning product, but Chinese customers weren’t having it,” said Li Ning CEO, Zhang Zhiyong. Design that reflects the “image and charm” of Chinese culture, Zhang said, is what Chinese customers like to see. When asked what domestic Chinese businesses can do to fight the global giants that are currently targeting the Chinese market, Zhang Zhiyong said that as the “post-80s generation” has become far more confident and has entered the social mainstream, we’ve seen a more international conception of brands emerge among Chinese consumers. This more international vision, Zhang said, is something that every Chinese company needs to adapt to.