Chinese consumers are becoming wealthier; they’re also becoming more impulsive.
A study by McKinsey & Company reveals that the number of shoppers buying a luxury item within a day of first considering the purchase surged to 37% in 2012 from 24% in 2010.
Shoppers may have more cash to spend, or marketing campaigns are doing a better job at influencing the “must-have” urges. But another major factor for impulse-buying is online shopping.
With over 500 million internet users, China’s e-commerce market is booming. As reported by China Economic Review, online retailers sold $121 billion in goods in China in 2011, a 66% growth from 2010. Sales are expected to reach $420 billion by 2015. Of the 1,000 Chinese luxury shoppers surveyed by McKinsey, 8% had made purchases online in 2012 compared to only 2% in 2010.
To tap into this massive online market, several luxury retailers have set up online shops in China. Among them, Burberry launched its online store in China in 2011, and Emporio Armani partnered with Italian online retailer Yoox in 2011.
However, when it comes to luxury retails, shoppers aren’t just looking for the products, they’re also looking for the whole luxury experience. In the most prestigious luxury boutiques, often, VIPs and elite customers have whole sections to themselves to peruse new collections while tasting high-end food and drink. Most importantly, they also develop a personal relationship with the sales consultants who provide them with the latest product news and event invitations. Such experience and service are parts of luxury retail that could never be replaced by e-commerce. McKinsey reports that e-commerce accounted for only 3% of total luxury sales in 2012.
However, there are benefits to having an online presence. Brands do not necessarily need to sell anything to actually influence shoppers’ buying habits. LVMH recently launched its Nowness.com in Chinese. This lifestyle website aims at shaping brand image and encourages readers to buy products without any actual online sales. Online comments from other shoppers also greatly influence brand perception and buying decisions.
Without a doubt, the internet and positive online experience influence brand perception that could ultimately trigger impulse buying.
photo credit: ihaveu.com