Which Luxury Brands Are Left Behind in China’s E-Commerce Boom?

on August 5 2014 | in Digital Retail | by | with No Comments

Gucci, e-commerce, China, Chinese online shoppers

E-commerce is booming in China, but some luxury brands are getting left behind.

Exane BNP Paribas’ study, “China Reality Check: Luxury and the Online Boom,” examined ten of China’s top multi-brand e-commerce websites and compared international luxury brands by the number of these sites on which they can be found. Among soft luxury companies, Burberry leads the pack with items for sale on 10 multi-brand e-tailers in China, including Secoo, Yintai, and JD.com. Chloe, Dolce & Gabbana, Gucci, and Tod’s rounded out the top five with products for sale on all ten websites. One brand you won’t find online in China is Italian fashion house Cucinelli, as it is on none of the top multi-brand e-commerce websites.

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Hard luxury companies—watch makers, jewelers, and pen makers—have not embraced e-commerce in China as enthusiastically as the soft luxury brands have. Tied with a presence on seven multi-brand e-commerce websites each are Cartier, Longines, Montblanc, and Omega.

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It’s no surprise that both Cartier and Omega lead the hard luxury brands in embracing e-commerce in China, as the latest WorldWatchReport from Digital Luxury found that Cartier, Omega, and Rolex were among the top brands in terms of the frequency with which they showed up in Chinese consumers’ internet searches. However, Rolex hasn’t been as quick as its competitors in embracing online retail, appearing on only four multi-brand e-commerce sites.

When compared to the number of soft luxury companies selling online, hard luxury companies fall short. One reason for this may be the difficulty in proving authenticity online. With Taobao in the press for its large number of counterfeits, as well as Exane BNP Paribas’ findings on counterfeit goods on Tmall, buying high-priced jewelry made from precious metals and diamonds with questionable authenticity may be too much of a risk for Chinese consumers. Plus, these hard luxury companies are most likely more selective when choosing an e-commerce site to sell through due to the necessity of selling on a site with a good track record of credibility.

Furthermore, a large majority of Chinese consumers do still prefer a retail environment due to hands-on customer service, the opportunity to gain a deeper knowledge of the brand, and the chance to try on the jewelry or watches before buying, as buying hard luxury goods isn’t as simple as viewing a picture and picking a size.

With China’s e-commerce boom gaining a lot of press recently, expect many of these brands to become more available online to Chinese consumers.

image credit: gucci, exane bnp paribas

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