Resonance’s Research Manager, Michael Norris, was sought out by Ordre for comment on latest developments in Chinese fashion incubation and retail strategies.
Ordre is a European online luxury wholesale platform with operations in London, Milan, Paris, New York, and Hong Kong. Launched in 2015, Ordre allows fashion designers to show off their collections via 360-degree photography and virtual reality to interested wholesale buyers. Ordre received investment from Alibaba in May 2018.
Michael’s interview was published by Ordre on 26 October 2018. The interview’s focus was on Zuczug, one of China’s leading domestic commercial brands and retail disruptors. Zuczug is at the leading edge of user acquisition and incubation to capture new segments and drive growth.
Wang Yiyang, the designer behind the Zuczug brand, with 73 stores in China and global ambitions. PHOTO CREDIT: WALL STREET JOURNAL
Key takeaways from the article and Michael’s interview:
Domestic fashion group, Zuczug, is working on a portfolio strategy through acquisition and incubation.
Zuczug’s incubation model is unique within Mainland China. It can be likened to the Comme Des Garçons support system in Japan.
The largest entity within Zuczug’s incubation model is WHM, an affordable luxury brand. Although it shares many sales channels with Zuczug, it has also found favor with specialty fashion outfits around Mainland China.
Zuczug’s incubation model is likely to be replicated by other domestic fashion and retail labels looking to appeal to new segments.
WeChat Moments is one of the most effective ways of reaching out to WeChat’s massive social media user base. WeChat recently released a report featuring the top 10 most loved WeChat moments ads.
For three consecutive quarters, Tiffany has achieved top 10 “Most Loved Moments Ads” status. As a client of Resonance, we are very proud to be a part of Tiffany’s success.
Q1 Top 10 Winner: Tiffany Bridal Campaign
Tiffany Bridal Campaign
Valentine’s day is a special day in for love in China, just as it is in the West. To deliver Tiffany’s message of love and encourage sales during the Valentine’s and the early bridal season, we created a special ad with WeChat that flips into a surprise communication when “liked”. The H5 campaign site included global stories of modern love and encouraged netizens to share their own stories for others to experience.
Q2 Top 10 Winner: Tiffany 520 Campaign
Tiffany 520 Campaign
To celebrate China’s love holiday on May 20th (5/20 which sounds like “I Love You” in Chinese), we promoted the classic Tiffany Setting and other collections designed for couples as gifting inspirations.
To drive engagement between Tiffany and Chinese millennials and create a connection through “Being Together”, we created a 520 campaign H5 which encourages couples to hold their phones next to each other to witness an animation play across both screens.
Q3 Top Ten Winner: Tiffany Chinese Valentine’s Day Campaign
Tiffany Chinese Valentine’s Day Campaign
Chinese Valentine’s Day is on the 7th day of the 7th Lunar Month (August). To celebrate the holiday, Tiffany partnered with Du Jiang & Huo Siyan (a highly influential celebrity couple in China) and created a Chinese Valentine’s Day campaign video to explore their love and love’s symbolism in the classic Tiffany setting & T Two ring.
To drive awareness during the the entire campaign, we launched WeChat ads in 3 waves to create more social buzz. On the day of Chinese Valentine’s Day (17th August 2018), we deployed the iconic Tiffany Blue Box through WeChat ads to continue Tiffany’s tradition as an icon of love.
Horasis the Global Visions Community hosted 500 delegates in the beautiful Ukrainian city of Kiev this past week for its 14th annual Davos style Horasis China meeting; an annual meeting of the minds with delegates from the business, finance and government communities converging on Kiev to talk about all things China.
The 14th Horasis China Meeting took place in Kyiv, UK over 14 -16th October, 2018. The meeting was hosted by the Global Transformation Platform and the China Federation of Industrial Economics.
Resonance’s Paul McNeill was once again in attendance to host an illustrious panel on the subject of “Unleashing Chinese Firms’ Global Investments”. Over the 90-minute roundtable discussion, a lively debate was held over the merits of the Belt & Road Initiative, the shift away from US investment, the curbing of “Irrational Outflow” of capital, funding of overseas acquisitions and the focus on key knowledge industries such as biotech, automotive, healthcare, and technology.
With the participation of among others; Zhi Peng the President of Tsinghua Asset Management, Ge Ming, the Chairman of the supervisory Board of the China M&A Association and Aivaras Abromavcius Economics Minister of Ukraine (2014-16) an open and insightful debate was conducted.
The Unleashing Chinese Firms’ Global Investments session focused on the strategies, key sectors and countries for Chinese capital. Session chair Paul McNeill opened by asking participants which new strategies can help Chinese firms to go global more successfully.
Over the two days, 30 interactive discussions were held at this invitation-only meeting, with many old friendships renewed and new friendships forged over business ideas, ideologies, and networking events. This unique event continues to build momentum with its approach to constructive dialogue and the broad range of topics covered and with Las Vegas a destination for 2019, the ongoing trade spat with the US will no doubt be one of the many subjects on the agenda.
Key takeaways from a few days intense dialogue:
China continues to develop from a manufacturing economy to a knowledge economy
Outbound investment is across the globe but is shifting from commodities to know-how investments
China continues to the lead the way in e-commerce solutions and is finding new innovative solutions for the convergence of offline and online retail
The outward thinking younger generation of Chinese have all the knowledge at their fingertips and the confidence of seasoned travelers to further fuel the growth of global travel destinations and brands
Millennials spend a lot of time online versus other age groups. Being exposed to fashions and trends from all over the world has led to greater sophistication and independence when purchasing luxury products. They overwhelming choose products for themselves, rather than choose based on the opinions of friends or the media.
Chinese Millennials Spend the Most Time on Digital Per Week
Millennials spend an average of 21 hours online on the internet and social media than all other age groups combined. Digital is the best way to connect with a Chinese Millennial audience.
Chinese Millennials Get Luxury Info from Digital
Millennials tend to get their luxury information from digital channels such as social media and online websites and news sources.
When Purchasing Luxury Goods, Only Millennial Opinions Matter
Millennials are less likely to follow the opinion of others, and rather form their own opinion of what to buy and what to wear. This is a continuation of a trend of purchase sophistication.
Tier-1 cities like Shanghai Beijing and Guangzhou on average have citizens with greater than average wealth vs. the rest of China. However the most wealthy Chinese tend to live in Tier-2 cities, and growth of netizens able to afford luxury products is higher in Tier-2 and below cities as well. Since many brands do not have physical retail presence in these cities, it makes adoption of ecommerce and scalable education through digital platforms critical to sales growth.
Growth of Luxury Consumers Mostly Outside Tier-1
The vast majority of growth for consumers is outside Tier-1 cities like Shanghai, Beijing, Guangzhou and Shenzhen.
Growth in Luxury Search Terms Highest in 3rd Tier Cities
While total volume of luxury goods sales in 1st tier cities is higher, the growth in luxury demand is happening in 2nd and 3rd tier cities. Reaching these cities via ecommerce is key.
Luxury Consumers Prefer In-Store Purchase
Customers still prefer to purchase products from luxury stores. Luxury brands should consider a “trunk show” solution to regions that they do now have a physical retail presence.
On October 17, Resonance’s Consumer Research Manager, Michael Norris, interviewed Meituan Dianping’s CMO Steven Shu as part of ITB Asia. ITB Asia is Asia’s largest travel exhibition, featuring international destinations, airlines, hotel chains, tourism bureaus and service providers from around the world.
ITB is Asia’s largest Travel Exhibition
This was Steven’s first interview about Meituan Travel following Meituan Dianping’s IPO on the Hong Kong Stock Exchange in September, where it raised US$4.2 billion.
Michael’s interview with Steven focused on Meituan Travel, Meituan Dianping’s travel services arm. During the interview, Steven spoke about Meituan Travel’s impressive growth and affinity with younger travelers.
Resonance’s Michael Norris Interviews Meituan Dianping’s CMO, Steven Shu
Unbeknownst to most industry outsiders, Meituan’s hotel reservation and booking services are at an equivalent scale to Ctrip and Qunar.
Meituan’s 大众点评 app is used by a third of China’s overseas travelers while they are abroad, and is the most frequently-opened app for overseas travelers, after WeChat and Google Maps.
This edge, coupled with Meituan Travel’s youthful user base, makes it a strong competitor to present industry leaders.
Steven also shared his team’s observations about trending travel destinations among Chinese millennials. Taking transit times and currency out of the equation, one of the key factors affecting an overseas destination’s popularity with Chinese travelers is food and beverage.
Steven emphasized the need for cities to put their best foot forward when it comes to creating and amplifying buzz around a city’s food and beverage scene.
Millennials in China have grown up during a very special time in China’s history. While they’ve definitely learned about China’s many troubles during the 20th century, China’s millennial’s themselves have only experienced the country’s massive prosperity boom. This makes the modern day Chinese consumer more optimistic than previous generations. Optimism has led to pride in Chinese culture and concern for national and environmental social issues.
Chinese Millennials More Optimistic Than Previous Generations
Millennials only know China as a prospering rising global power. Thus they are significantly more optimistic they do better than the previous generation than other millennials around the world.
Pride in Chinese Culture and Heritage
Age groups 18-25 and 26-40 have the highest levels of cultural consumption. China’s rising position on the global stage has led to an increase in pride and a newfound preference for Chinese cultural products that reflect China’s history and heritage.
Chinese Millennials Care About Social Issues
Climate change and Income Equality top the list of Millennial personal concerns. These concerns reflect a growing sophistication and awareness of a world beyond themselves.