Mobile Applications

Tencent Courts Luxury Brands Via WeChat

China’s Tencent is using WeChat, its social media network, to lure high end fashion brands, which could be a new effort in the world of online retail.

According to a report in The Wall Street Journal, Longchamp of France and Burberry Group of the U.K. have started selling their high end designer handbags and clothes via WeChat, which is the most popular messaging app in China. LVMH Moët Hennessy Louis Vuitton SE’s Givenchy and Dior brands are also testing demand for their goods through flash sales on the messaging platform, reported the paper.

The push on the part of Tencent and WeChat could be a challenge to the leading eCommerce player in China, Alibaba. Online transactions on Alibaba-owned eCommerce sites are expected to hit $870 billion in 2017 alone. The company processed more than $547 billion in transactions during fiscal year 2017, which analysts told the paper is more than eBay and Amazon combined.

The push by Tencent to court high end brands is part of its expanding fight between the internet companies in China. Alibaba, Tencent and Baidu, all headquartered in China, are branching out beyond their core businesses into everything from payments to social media.

“Customers have responded very well” to Longchamp’s limited handbag sales on WeChat, said Jean Cassegrain, chief executive of the luxury brand, which is considering expanding its product lineup on the app, according to the Wall Street Journal. “One way or the other, [WeChat] will significantly contribute to our sales.”

Tencent’s more than 900 million WeChat users — who do everything from purchasing movie tickets to scheduling laundry pickup times on the messaging app — are taking advantage of the app’s popularity to lure high end brands.

In 2017, Tencent has also made it easier for brands to launch multimedia advertising campaigns on the app and set up shops, all of which is driving more interest from luxury brands.

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