Source : Jing Daily, March, 31- The Luxury Business in China
Luxury brands including Fendi, Dior, and Marc Jacobs may not have official shops on Tmall, but China’s fashionistas can now easily find them on the platform’s newly launched “Luxury Channel” created in partnership with flash sales site Mei.com.
Yesterday, the two companies held a star-studded, high-tech runway extravaganza in Shanghai to promote the new channel. Celebrities on hand for the festivities included reality star and socialite Olivia Palermo and singer Li Yuchun (Chris Lee), and the event was live-streamed on Tmall and Youku. Users watching online had the opportunity to purchase any of the 42 looks from the new platform in real time. Selected from 80 designers featured on Mei.com, the looks included brands such as Karl Lagerfeld and Moschino, with one styled by Olivia Palermo featuring pieces by Saint Laurent and Chloe. In order to capture viewers’ attention, the show also hosted a singing performance by pop star Tia Ray, while actor Yilun Sheng walked the runway in one of the outfits.
The new launch comes after Alibaba’s July 2015 investment of more than $100 million, and will feature flash sales managed by Mei.com directly on Tmall with brands that have opted to be on the platform. According to Mei.com CEO Thibault Villet, the presence on Tmall will help the flash sales company expand its customer base to consumers from lower-tier cities as well as “further expand access to technology” through Alibaba. Mei.com previously opened its own Tmall shop in December 2015.
“Currently most of our customers are Tier 1 and Tier 2 customers,” says Villet, “and here with this channel, we will be able to enlarge our reach to Tier 2 and Tier 3 customers.” He also says the channel will be targeted at younger consumers with an emphasis on more contemporary brands in Mei.com’s portfolio, with the same price points that are featured on Mei.com.
Meanwhile, the new platform dramatically expands the presence of major international luxury brands on Tmall as the site works to attract premium and international labels and fight an image of counterfeits being rampant on the site. “We’re very strongly positioned to be the gateway between luxury fashion designers and Tmall,” says Villet. The Tmall and Mei.com joint press conference for the launch emphasized the presence of international brands such as Burberry on Tmall, discussing how Burberry has pursued a “seamless experience online and offline” by matching its in-store and online prices.
Edoardo Tocco, the regional director for China at TOD’S Group, which owns Roger Vivier, TOD’S, and Hogan, was on hand to discuss why he believes the new platform will benefit his company’s brands. “Consumers in China are driven by pragmatism, convenience, and value for money,” he says. “These three key drivers are those that we should always put in the back of our minds.”
According to him, “In China, e-commerce is getting to be one of the most important channels.” This is a good thing for brands, in his opinion, because, “in the digital world, you can actually be very smart about managing in-season and off-season products with different strategies,” he states, noting that “e-commerce should be completely integrated upstream and downstream with your other channels,” in terms of product launch, availability, and logistics.
In addition to flash sales, the new platform will also soon include a cross-border component that leverages Tmall Global, says Villet. This will feature items at full international prices shipped from abroad, and is being created in response to a 10,000-customer survey by Mei.com that showed high demand for the service. Mei.com will launch a cross-border sales platform on its own site, featuring smaller niche brands from places including the United States and the UK. “We’re leveraging Tmall Global as a first point of entrance and later this summer we will have a second point of entry directly on Mei.com,” he says. He notes the importance of adding cross-border sales as the demand for international goods is “a growing trend” that is being “encouraged by the government” through new special e-commerce import zones.
Mobile technology also remains key to sales on the platform. “The business we do is now more and more apps-driven,” says Villet, who notes that 80 percent of Mei.com’s sales are now through mobile apps as of last month. Mei.com has recently been embracing mobile-focused content-driven marketing with a newly launched content channel that publishes “Mei Magazine” featuring editorial content focusing on trends and information.
Mei.com expects these efforts to significantly expand its user base. The site currently has around 7 million members, and projects that this will grow to 10 million by the end of 2016.
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