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Connexions – A Closer Look on “E-Retail: Luxury Gets Going… Finally!” by Patrice Nordey

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According to a study done by KPMG, 72% of Chinese tourists traveling abroad claim to have bought luxury goods. These purchases represent a significant proportion of their total expenditure (over 40%) with the most popular products of choice as cosmetics, watches and handbags. The prices of these products bought abroad are 20 to 30% cheaper than in China, and account for half of China’s luxury market today.

However, with the rapid development of online shopping in the Middle Kingdom (159 billion Euros at end 2012), we see pure Internet players taking advantage of this lucrative market in the recent years. Startups such as 5lux.com, Ihaveu.com, Shangpin or Xiu.com (87 million turnover in 2012) buy directly from distributors – rarely trademarks – and short all intermediaries to offer prices 20-50% lower than those charged by official channels shops.

Some of these actors, such as Secoo.com, even sell second hand luxury goods while ensuring the authenticity and condition of the product through strict certifications.

To counter these new discount models – which have tremendously opened consumers’ appetite for the “digital luxury” – premium and high end brands fuss to offer their online distribution model to recreate the conditions of an experience luxury with exclusivity, personalization and value-added services.

Upscale cosmetics brands were the first to launch, for example Lancome or the specialized retailer Sephora in 2006. Marni, Armani, Bally, Dolce & Gabbana, Alexander Wang and the Moncler brands have also launched in 2012 under the auspices of the Italian Yoox platform. More recently, Hugo Boss and Coach launched their e-commerce with a narrow range of products. Department stores such as Marks & Spencers and Lane Crawford also accelerated the development of their Internet offerings for their wealthy clients in China and Hong Kong.

Estimated at 11.1 billion RMB in 2011, the e-luxury market in China jumped by 71% in 2012 with 18.9 billion RMB of online spending. It is expected to exceed 45 billion RMB by 2015 according to iResearch and thus, capturing 10% of the first luxury market in the world.

Velvet invited to the Lane Crawford Store Opening in Shanghai

Velvet was pleased to be invited by Lane Crawford to a special evening celebrating the Grand Opening of China flagship store.

Lane Crawford opening shanghai

Lane Crawford opens its China flagship store in Shanghai’s Times Square, providing shoppers with 150,000 square feet and four floors worth of 500 brands across women’s fashion, beauty, fine jewelry, menswear, and home and lifestyle, making this the largest Lane Crawford store ever! Featured brands include Alexander McQueen, Givenchy, Lanvin, Saint Laurent Paris, Alexander Wang and Sacai; as well as collections including Alice & Olivia, Sandro, Maje and the introduction of J. Crew in China.

“Global retail leadership is now coming from China, and the China customer is at the forefront of fashion. We set out to create the ultimate luxury fashion and lifestyle destination – the largest selection of luxury brands in an innovative, highly visual space, offering world-class service at a scale never before seen in Shanghai”

Andrew Keith, CEO of Lane Crawford

The store was designed in collaboration with architecture firm Yabu Pushelberg, which has worked with Lane Crawford on four previous stores. The design takes a “modern gallery approach to retail”.

During the evening party, Lane Crawford welcomed a range of Chinese celebrities as well as über-stylish crowd.

Lane Crawford Store Opening shanghai

From left to right: Hong Kong actress Carina Lau, Chinese model Du Juan, Chinese actress Zhou Dongyu, Chinese TV Hostess Zhu Zhu, Taiwaiese model Godfrey Gao, Hong Kong actress Maggie Cheung – Photo credit: Lane Crawford

Location: Times Square, 99 Huai Hai Zhong Road, Shanghai