Luxe.CO X Business France | How To Win In The China Market

October 5,2019

As the world's largest and fastest growing fashion consumer market, China's appeal is undeniable, but it is also a complex and competitive market. So, how can small and medium European fashion brands enter the China market and develop successfully?

On October 2nd, 2019, Paris, Luxe.CO joined hands with Business France to hold the first "China Fashion Forum" in collaboration with a large number of professionals and senior executives from China and France. Nearly 100 small to medium French fashion companies attended the event.

Alicia Yu (image below), founder and CEO of Luxe.CO, delivered a keynote speech titled "How to Win in the China Fashion Market" for the forum. She used exclusive research from Luxe.CO and statistics to demonstrate the great potential of China's fashion consumer market. In particular, she pointed out that the low concentration of fashion brands in China provides plenty opportunities for niche brands with unique products.

When it comes to the channels for overseas brands to reach Chinese consumers, in addition to the online channels and tourism retail channels that are often mentioned, Alicia Yu especially pointed out that Chinese fashion consumers, especially millennials, pay great attention to shopping experience, store design, brand history and innovation spirit. Opening a physical store in a shopping center is still an important channel for new overseas brands to enter China, especially for establishing brand awareness.

In addition to the first-tier cities --- Beijing, Shanghai and Guangzhou, overseas brands need to fully understand fashion consumer enthusiasm and purchasing power from the second and third tier cities in China. She cites data from DFS, an international travel retail giant, which shows that visitors from other Chinese cities spend on average 10% more than those from China's first-tier cities. Tourists from second-tier cities, for example, who spend an average of $2,500 per trip, prepare a shopping list for friends and family before trips.

Below are the 5 key success factors highlighted by Alicia Yu for small and medium French and European fashion brands wishing to enter China market. 

1.Build a Strong Team 


3.Communication First 

4.Distribution with Flexibility 

5.China Pace!

Alicia Yu stressed that the brand should pay great attention to the China market by using the best talent from headquarters, and seeking local young talents and partners who are passionate about the brand and full of entrepreneurial spirit, while also setting up incentive mechanisms which are suitable for China. Chinese consumers have great expectations for brands from France and Europe. Compared with the local market in Europe, when brands come to China, they must improve and optimize their brand image, product quality and communication content to live up to expectations.

"Brand is media", overseas brands should prioritize communication in the China market. Opening flagship stores in hot spots can attract high-end consumers, but for small and medium brands whose budget is limited, the priority is to create rich and attractive brand content through social media and a variety of online and offline channels, to communicate with Chinese consumers and lead them to search for the brand proactively.

Different from Europe, China's fashion market does not have a very developed network of "multi-brand retailers". Brands mainly carry out direct retail through exclusive stores. Whether it is wholesale or retail, online or offline, China's distribution channel network is complex and constantly evolving. Building a channel portfolio and searching for partners should be a flexible process with small steps, trials, errors, learnings.

For most European brands, the most difficult thing is to adapt "China pace!". As the CEO of Devialet, one of France's top audio brands, said in an exclusive interview with Luxe.CO recently: "It takes us 8 to 12 months to open a store in France, Europe or the US, but in Beijing and Shanghai, it only took 2 months. In other countries, we will first open 1 to 3 stores with our partners, and after half a year, we will open 10 stores with good progress, if successful, we will open 20 stores, but in China, we will start with 20 stores, and then we will discuss. It's exciting to grow at this rate, but it's also a challenge for us."

Frédéric Rossi (image above), Deputy Managing Director of Business France, delivered a speech at the forum.

M.Hu, Vice President of Tus-Holdings & Executive Director of Tus-Europe (Italy), delivered a speech on the forum, saying that Tus-Holdings is positioned as a consumer upgrading platform to build an innovation ecosystem focusing on "technology +", "design +" and "art +", incubating new technologies, new brands and new models. Through its new commercial management company, it will build a new generation of commercial centres based on new commercial infrastructure and to promote urban renewal. Through its new brand management company it will activate time-honoured brands and cultivate new brands. In the future, Tus-Holdings will join hands with Itochu Fashion System to create an innovation ecosystem for global fashion industry.

Takaaki Komatani (image above), President of Itochu Fashion System, shared the strategy of French brands in Asian markets.  Itochu Fashion System, as one of the five major business associations in Japan, has a wide range of businesses, ranking 204th among the world's fortune 500 companies in 2018. Takaaki Komatani pointed out in his speech that European brands could showcase themselves in the whole Asian market through a twin cities strategy of "Tokyo + Shanghai".

Zilan Tang, Executive Vice President of Chengdu International Fashion Federation (CDIFF), introduced Chengdu, the third largest luxury market in China, through rich pictures and video materials.

Philippe PEDONE, Director of International Development of Galeries Lafayette; Nicolas Santi-Weil, CEO of AMI Paris; Masha Ma, founder of Chinese designer label Masha Ma; Jonathan Sibon, CFO of Luxury Insight discussed the current situation and trend of fashion retail market in China. ( Image above )

Regina Szeto, Vice President of Brand, International PR & Marketing at SECOO ( 寺库 ); Philippe Blanquet, Director of Export Department of Petit Batea shared what digital strategies overseas brands should adopt in the China market. 

Xiao Long, CEO of Alter Universe; Meimei Ding, CEO of DFO International; Jie Cu, Head of European Operation of HeQiao Group ( image above), shared insights of new retail trend in the China market, the role of showroom, and the development of multi-brand retail model in shopping malls. 

Pascal Morand, Executive President of the Fédération française de la couture, made a closing speech for the forum. 

More photos from the event:


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