Luxury retail has run into a conundrum as digital channels and eCommerce continue to edge out brick-and-mortar shopping venues. Although eCommerce may not be replacing traditional retail just yet, it’s a channel that merchants can’t afford to ignore. Despite this widely accepted reality, many luxury brands have been doing just that: ignoring it.
For many luxury brands, the in-store experience and presentation are part of the package. This has kept them from embracing omnichannel retail in the same way as some of their more affordable counterparts – which has been to their detriment, as shoppers are gravitating toward brands that meet them where they’re at, not the ones that require them to go find the brand in a retail setting.
But all that may be starting to change as marketplace and eCommerce functions become more common across social channels such as WeChat, Instagram and Snapchat. Luxury is now beginning to find its way into the spheres where consumers are spending their time.
Tod’s and Tao Liang Join Forces in Baoshop
Exhibit A? Luxury brand Tod’s has jointly designed a limited-edition bag with Tao Liang, a.k.a. Mr. Bags: one of China’s most popular fashion bloggers and a powerful style influencer with 4 million social media followers. The product made its world premiere through a WeChat mini program called “Baoshop” on Tuesday, June 26.
Baoshop is a limited-time exclusive pop-up shop customized by Liang just for shoppers. It’s designed to give them information about the product and a funnel to completing the purchase via WeChat Pay. In a press release about the bag’s world premiere, Liang said the mini program offers convenience and efficiency for shoppers while preserving the high-quality luxury experience.
That could provide a major assist for luxury as a category as it looks to move sales from the physical to the digital world. There are definitely takeaways from Liang and Tod’s Baoshop that could be applied to any other market – though of course, each market has its own unique advantages and challenges that will factor into the success of such an approach.
What it Means for the Worldwide Luxury Market
The omnichannel evolution is underway in China’s luxury sector. Mini programs like the Baoshop by Liang and Tod’s have already become key elements as brands step up their digital game to connect with shoppers – but they are by no means the only ingredient in Chinese luxury’s recipe for success.
The market has given birth to a unique economic model called the fans economy. Essentially, what happens in the fans economy is that influencers like Tao Liang act as middlemen between consumers and luxury brands. This gives luxury brands a lens into what potential shoppers are looking for and what their buying habits are like, enabling them to refine their interactions with consumers.
Whether that can translate outside of China remains to be seen, but it’s definitely not out of the question. Every country has its fashion influencers, and every influencer has fans who will follow their style idols not only with their likes and re-posts, but with their dollars. So in that sense, a fans economy could be possible anywhere.
However, it’s also important to consider the role WeChat has played in creating this economy. The company says it’s continually working to provide more and better digital toolboxes for brands, merchants and influencers, empowering them to serve their buyers and fans ever more directly.
The soil may be fertile for a fans economy in the U.S., Europe, or elsewhere, but it may take efforts by a company like WeChat to truly make it grow.