The players in front of the double 11 continue to increase the number of luxury goods into the most incremental new battlefield

“Science Flayer Godfather” Robert Sawyer tells the Neanderthals who live in another parallel world in the Parallel World – the “primitives” in the real world. In the past, in the eyes of some senior practitioners in the luxury goods industry, the Internet and luxury goods are also like two parallel worlds.

Today, in the context of consumer upgrades, the luxury market is welcoming new opportunities. Chinese E-Commerce companies, represented by Ali and JD, are trying to build a bridge between the two worlds. It coincides with the “Double 11” decade. On October 26, Alibaba announced the establishment of a joint venture with Yoox Net-A-Porter (hereinafter referred to as YNAP), the luxury E-Commerce company of the world’s second largest luxury goods group, and Jingdong and Temple Bank. Domestic E-Commerce companies have also increased their yards.

At present, in the online competition of Chinese luxury goods, Ali and Jingdong are in the stage of recruiting and recruiting. Compared with E-Commerce‘s “breaking out” of brands one by one, the way of directly cooperating with luxury goods groups has become a shortcut. E-Commerce companies have found that in the world of luxury goods, there are a group of consumer users who do not talk about cost-effectiveness and awareness, and they have a natural separation from the mass-market E-Commerce consumers. As an important sales channel for retailers and brand owners, E-Commerce platform has gradually become an online sales channel for high-cold luxury brands in the Chinese market. Many luxury giants are also fully embracing the E-Commerce platform.

In the view of E-Commerce analyst Li Chengdong, the position of E-Commerce in the luxury goods market has become more and more prominent. With the likes of the traditional luxury goods industry, such as the Ruyi Group, and the Fosun Group representing the capital, different types of players have appeared in China. And even the global online luxury goods market hegemony drama officially kicked off, indicating that the industry may usher in explosive development.

Jingdong‘s fashion advancement

The book “Creating Jingdong” wrote in the corporate culture of Jingdong, “The morale is beaten by the winners.” Before taking over the president of the Jingdong Mall fashion life business group in January this year, as a 25-year veteran of the communications industry, Hu The Jingdong 3C Iron Army led by Shengli has always been the “Changshengjun” in the industry in the 3C E-Commerce field. It is such a group of iron army that does not understand fashion and does not understand luxury goods. It has taken the burden of revitalizing Jingdong fashion and luxury goods business.

What did Jingdong think? “I am a person who has won, and I want to win again.” A Jingdong related person who also moved from the 3C Iron Army to Jingdong Fashion Business Department told the reporter of “Daily Economic News.” On May 9 this year, Jingdong Fashion Life Group welcomed the first important strategic release and partner conference. Hu Shengli, who had been in the new four months, caused quite a stir when he appeared. “Who said that selling mobile phones can’t sell clothes?” became the most vivid expression of Hu Sheng’s most vivid image.

In the industry’s view, choosing Hu Shengli to take over the “last piece” reflects Jingdong‘s high trust in Hu Shengli. After bringing the 3C business unit to a certain height, the fashion business will be another challenge he faces.

However, the battle that Jingdong wants to win is not easy. Looking back on 2017, Jingdong fashion business experienced the lowest period, from “618” to “double 11”, Jingdong was continuously involved in the “two choices one” storm, and many fashion clothing brands successively forced them to participate in the promotion and disrupted the price. The system is directly announced to close the Jingdong store.

In the industry’s view, this incident has inspired Jingdong‘s determination to fight back. The iconic event is the “TOPLIFE”, an independent luxury online shopping platform launched in October of the same year. In December, it announced that it and Tencent jointly invested 863 million US dollars in Vipshop. So far, Jingdong has started to buy and buy big, and has invested in luxury platforms such as Farfetch and Temple Library. It is obvious that Jingdong is trying to outline Jingdong’s own “fashion puzzle” by arranging platforms of various fashion consumption levels.

In addition, Jingdong is also optimizing its fashion genes, using the 3C iron army who knows the most about Jingdong and the retailers who know the most fashionable luxury goods, to achieve true online and offline integration. “Recently, has placed more and more emphasis on bringing talents offline to the online talent team. Online and offline talents also have great complementarities in terms of knowledge structure, understanding of brands, and understanding of goods.” Jingdong Jiang Ke, vice president of the strategic planning department of the mall fashion business department, told the reporter of “Daily Economic News”, “My arrival also represents the beginning of Jingdong‘s change in talent structure from one aspect.”

Before joining Jingdong, Jiang Ke worked for nearly a decade in the chain of high-end department store shopping mall chain Ole. He is also a key figure in leading and trading this year’s major cooperation – Ruyi Group and Jingdong strategic cooperation.

Another person who promotes Jingdong‘s luxury goods business is Ding Xia. Before taking over TOPLIFE, Ding Xia was the head of a luxury brand in the Asia Pacific region. In the words of Jiang Ke, luxury goods are very cautious, and Ding Xia can share the brand with the brand, can communicate with the brand on the same level, understand the brand’s appeal, pain points, and more effectively increase Jingdong and Brand cooperation.

It can be seen that whether it is the introduction of talents, contracted brands and groups, capital investment, or adjustment of their own management services, logistics supply chain, to adapt to the fashion market and consumers, Jingdong‘s ambition to compete for the fashion luxury market has always been.

“It’s more like a Go game.” Jingdong’s insiders told reporters that although they are still unbeaten in the category that their opponents have accumulated for more than a decade, the layout has not ended. It is reported that Jingdong recently announced that the luxury goods business will be split from the men’s luxury department and established as a separate secondary department.

New battlefield with the most incremental space

The battlefield is full of smoke, and players are eager to try. For the time being, Jingdong and Alibaba are not the biggest players in the luxury E-Commerce industry, but the camps with them in the background are starting to compete.

On November 1st, Hamilton, a well-known Swiss watch brand with a history of 100 years, announced its official presence in Jingdong, opening its first online brand authorized flagship store in China. This is also the first brand that Xinyu Group has rapidly promoted since its strategic cooperation with on October 23. As the two continue to accelerate the recruitment of luxury goods groups and E-Commerce platforms, the industry believes that the luxury goods sector has the opportunity to appear the next tens of billions of dollars in the valuation of the phenomenon-level platform, and the giants are hoping to appear in their own camp.

However, in this field, Ali is still the strongest online player in the field. In this cooperation, YNAP has nearly 1,000 luxury brands and designer brands in Tmall. In fact, convincing the luxury brands to enter the country has always been a problem for Chinese E-Commerce.

Recently, Gucci (Gucci) CEO Marco Bizzari publicly stated that due to the proliferation of fake goods, Gucci is reluctant to cooperate with the E-Commerce platform operated by Alibaba and JD. In response, Jiang Ke responded that Jingdong and Kaiyun Group have already had in-depth cooperation. Gucci is still not quite familiar with Jingdong, and Jingdong will gradually communicate with Gucci brand parties.

Apparently, Ali recently announced cooperation with YNAP. In a certain way, it is also a side-side “show muscle”, and it is back to the bombardment of Gucci CEO. In the words of Johann Rupert, chairman of the Richemont Group, this is also a milestone in the luxury goods industry.

In the industry’s view, unlike the logic of the category E-Commerce era, the luxury E-Commerce and the strict selection mode, the same as the multi-multiple mode, is a new battlefield with the user’s perspective as the entry point. Therefore, the giant suddenly discovered that the world has a group of luxury consumer users who do not talk about cost-effectiveness and awareness. They have a natural separation from the mass E-Commerce consumers. This is one of the reasons why Ali and JD have invested heavily in the luxury E-Commerce sector in just half a year.

Another reason is the rising market space. As an important sales channel for retailers and brand owners, E-Commerce platform has become an online sales channel for high-cold luxury brands in the Chinese market. Many luxury goods giants are also fully embracing the E-Commerce platform.

According to a report released by Bain Consulting, in 2017, China’s luxury goods market sales reached 142 billion yuan, an increase of 20% over 2016, the largest increase since 2011 and surpassing overseas markets. Among them, E-Commerce sales accounted for 9%, while in 2015 this ratio was 6%. The latest report shows that China’s luxury goods sales are expected to increase by 20% to 22% this year.

In this context, luxury E-Commerce has also had an opportunity to break out. In the face of new opportunities, all the capital and industry players are eager to move, have added to the online luxury platform, and reached its peak since last year.

It is worth noting that in the international market, LVMH Group, Kaiyun Group, Richemont Group, Hermes Group, Chanel Group have covered almost all luxury brands on the market. In the Chinese market, Alibaba and Jingdong have joined the battle. In recent years, Ruyi Group, Fosun Group, and the Sand Ship Group, which are mainly active in the global luxury market, have also appeared.

In addition, compared with other platforms, the first stock of domestic luxury goods E-Commerce – Temple Library since its establishment in 2008, has been deeply cultivated in the vertical field of luxury goods for ten years.

According to data from internationally renowned research firm Frost & Sullivan, Temple Library has a market share of 25.3% and 15.4% in the high-end online market in China and Asia, respectively. It is also the online platform with the largest number of luxury brands in China.

At the same time, in July this year, Ruyi Group and Temple Bank reached a strategic cooperation agreement; in August, Jingdong and LVMH Group invested in the temple library; in September, the Sand Ship Group also signed a strategic cooperation with it. Therefore, there is a view that in the country, Jingdong, Alibaba, and Temple Bank have formed a three-point situation. However, in the view of Li Chengdong, in the future, the luxury goods market will be biased towards the vertical and horizontal.

What is certain is that with the rise of the “Millennial Generation” consumer power and the formation of high-quality consumer trends, China’s future high-end consumer market space is optimistic.

At the same time, Li Chengdong believes that the strengthening of online counterfeit goods supervision by E-Commerce is further addressing the concerns of brand owners. The attitude of luxury brands to online channels has begun to become paralyzed. On the one hand, there are still some doubts and even contradictions on online channels. On the other hand, more are worried that opponents have seized online share, so they have added Chinese luxury. Product E-Commerce, in order to get a share.