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Luxury brands in China embracing new social channels

By Don-Alvin Adegeest

May 30, 2017

Chinese consumers are 8 times more likely to respond to an influencer post. This comes as luxury brands are embracing new social media channels like WeChat ecommerce, according to L2's Digital IQ Index China: Luxury 2017.

"The most successful luxury brands in China have embraced ecommerce and are experimenting with new channels such as WeChat commerce," said Danielle Bailey, head of APAC research at L2 in New York." According to Luxury Daily they have also responded to the rising popularity of livestreaming and short video platforms with celebrity campaigns that resonated with consumers and spiked both social engagement and search volume.

Today, Chinese consumers continue to spend more on luxury goods than shoppers from any other country, and after two years of declining sales, mainland China's Luxury market is kicking back into gear.

China has embraced digital platforms not used in the West

While geographically markets have their own peculiarities, China is a nation that uses digital platforms far different from Europe and the West. There is no Facebook, Google, Instagram or many other common digital destinations in China due to government regulation.

Instead, Chinese consumers rely on platforms such as WeChat, Tmall and JD to search for products, view and share social content and make online purchases. The brands that do the most to embrace these platforms have the most success, according to Luxury Daily.

Content is king

Online shopping in China has soared in recent years, and for successful websites and platforms, content is king. These platforms are publishing high caliber content that would normally appear on a brand’s personal site.

The Chinese are also much more mobile-savvy, with mobile being the preferred channel for engaging with brands, consuming media and making purchases. WeChat is a strong driver of this trend, with its emphasis on mobile payments helping to boost the mobile commerce sector.

WeChat’s social gifting and augmented reality coupons on Alibaba’s Alipay are a few of the tools consumers can leverage through mobile wallets that make the customer experience in China extremely advanced.

"As the China luxury market’s growth picks up again, but at a slower pace than the years before the anti-corruption campaign, a brand’s success in China hinges on its digital strength," said Liz Flora, editor of APAC research at L2. "A strong digital presence will enable brands to withstand market fluctuations."

"Celebrity relationships are now a cost of doing business in the market," she said. "Luxury brands can convert well-executed celebrity relationships into bottom line results and poorly executed relationships to online backlash."

Credits: Photo L2 Digital IQ China Index:Luxury 2017