Why Digital Commerce Rules in China

on December 3 2012 | in Digital Trends | by | with No Comments

Desmond Bateman, the strategic planning director at digital agency Isobar, sees the growing predilection of online shopping among Chinese consumers. “Marketers can no longer ignore digital,” he says, “It’s a world they must embrace if they are to seize market share that their future and stability demands.”

While many will argue that online shopping in Asia is mostly the domain of discount sites, the potential for market growth remains impressive. This past August, Martini Media published an article asserting that, “Digital media is more effective than offline marketing. But marketers need to pay more attention to the editorial environment. It’s not enough to merely have a website. Brands also need a proven plan to drive consumers to e-commerce sites.”

For brands like Cartier, Tiffany, and Chanel, search engine optimization has attracted Japanese consumers to make purchases online. Keywords like “ring” and “marriage” entered into search engines act as portals to their respective websites.

Internet marketing is also leading to a new hybrid trend: researching online, purchasing offline (ROPO). This strategy drove 4.2 percent of total retail sales in China in 2010, and for as much as 13 percent of sales in South Korea, suggesting what the future of internet marketing holds for China as its luxury market matures.

Bateman suggests that for the moment, luxury retailers in China aren’t so concerned with where buyers make their purchases, as long as they are indeed purchasing.  He cites Burberry as a leader in the integration of physical and digital marketing by bringing the online experience into stores. Burberry customers are able to experience “a live connection to the brand website, RFID tagging systems, digital mirrors and touch points that can be shared through social media” at retail locations reports Campaign Asia-Pacific.

The Lane Crawford brand was a bellwether in integrating digital and in-store luxury experiences, launching their new initiatives in October 2011. Now Andrew Keith, the brand’s president, is able to say just how beneficial that transition has been to business. “You can buy online and pick up or return it to the store; you can buy online in store; you can work our personal stylists online and in-store, interchanging for your convenience and we have trilingual customer service teams to advise you. We’re maximizing reach in a way that would never be physically possible while also engaging new customers,” he says.

Bain & Company expects that China’s luxury category will grow by 20 percent this year, double the global average. As such, China will be the center of digital marketing campaigns in Asia.  While many brands fear that e-commerce websites cheapen brand images, 62 per cent of Chinese consumers feel that e-commerce is “suitable” for buying luxury goods online, according to he China E-Commerce Research Centre.

[campaign asia]
photo credit: lane crawford

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