As luxury brands look to social media in China to develop their brand many have yet to find any real success. This presentation outlines the luxury landscape and the promise of social media in developing a brand strategy. Further, offers 3 simple strategies to help make this process more cohesive in developing a Chinese online social voice.

1. Leveraging Chinese Social Media in the Luxury Market
2014
www.digitaljungle.com.cn

2. AGENDA
luxury marketing
changing attitudes
luxury shopping & social media
chinese social media
challenges
overseas purchase
social media strategy
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3. LUXURY MARKETING TO CHINESE
The luxury market in China is huge and growing fast. In 2015, China will
account for one-third of the global market (estimated at around $175
billion) for luxury goods
Source: http://www.industryweek.com/global-economy/china-claim-one-third-luxury-market

4. CHINA’S WEALTHY
There are now a total of
1.05 million millionaires, up
3% from the previous year.
Millionaire Profile
Their average age is 38, with more than half
aged between 31 and 45. 70% are male.
43% have Masters degrees or above, or
EMBAs. On average they own 3 cars and 4
watches. On average, millionaires leave
China 2.8 times a year, and are away from
home on business for 7.5 days per month.
Their average annual holiday remains stable
at 20 days. In their leisure time they like
travelling, reading, and drinking good teas;
their favorite forms of exercise are
swimming and golf. They get most of their
information from the Internet.

5. LUXURY SHOPPING & SOCIAL MEDIA
The Chinese luxury market is booming. Many international brands are expanding their
investment in China and opening a lot of new stores, not only in tier one cities like Beijing and
Shanghai but also in lower tier cities as well.
The luxury category is broad and includes leather goods (bags), shoes, fine jewelry, watches,
RTW (Ready-to-wear or prêt-à-porter) and accessories (sunglasses, belts and so on).
Additionally, cars, hotels, cosmetics and service level products can be included and one
thing holds true. Social media is a natural fit given the Chinese target audience is all digitally
connected and is actively engaging with social media.
With China having representation of almost every Global luxury brand, it is not unexpected
that most are turning to social media to create a brand awareness and try to engage with
Chinese consumers. The simple fact is that many brands will fail to gain traction in such a
crowded marketplace where consumers are becoming increasingly skeptical and loyalty
with a particular brand is transient at best.

6. SHIFTS IN CHINESE ATTITUDES TOWARDS LUXURY
• New Money
• Low customer sophistication
• T1 is all that matters
• Straightforward customer journey
• Focus on status
• Big names rule the game
• Western dividend
• Wives + Business men drive the market
• Building a retail footprint
• “New old money” + Growing Money
• Customer sophistication on the rise
• T2 + the new Eldorado
• Complex customer journey
• Focus on differentiation
• Niche brands now matter
• Localization is key
• Arty youth + Power women set the tone
• Building a retail experience

7. OVERSEAS LUXURY PURCHASE
As ever larger numbers of Chinese consumers travel
overseas, they recognize that certain luxury products
are significantly cheaper abroad. For example, a
Prada bag is 12,600 RMB in Beijing but it only 795
EUR (7,398.75 RMB) in Europe.
With the new tax policy, the price difference between
the Chinese mainland and abroad makes
International purchase an attractive prospect.
Australia & New Zealand are becoming increasingly
popular shopping destinations for Chinese
consumers given Duty free shopping (DFS) and tax
(GST) refund programs.

8. SOCIAL CHALLENGES FOR LUXURY BRANDS
The pace at which negative sentiment/stories travel within Chinese social networks has
taken many by surprise in the past and now many brands have taken to 24/7 social
listening and monitoring. A few more proactive brands have even created crisis protocols
with preapproved content and landing pages so that a rapid response can be made given a
particular brand crisis.
Brand Crisis Management
Social Media Management
Simplify establishing an account on a Chinese social media platform is not adequate.
Creating effective fan acquisition and content programs are critical to ensure people visiting
your page or engaging with your content receive a consistent brand story. Additionally,
having appropriate key opinion leaders (KOL’s) work in partnership with your social program
will create a bridge to their fans and lead to wider reach.

9. Go beyond sales, build relationships

10. For luxury brands looking
to engage with Chinese
consumers, social media
offers one of the best and
most effective medium in
reaching a broad audience.
That said, many luxury
brands have failed in
developing their social
brand, fan acquisition
strategies and content
programs.
CHINESE SOCIAL
MEDIA
Kaixin
Sina Weibo
Tencent Weibo
Youku/Tudou
WeChat/weixin
Meilishuo/Mogujie
JiePang
Douban
Early star, now dying. Not
worth incorporating in a
social media program.
Significant reach across all
of China and important
platform for any social
media program.
Strong audience in T2 cities
Critical platform for video
storage.
Rising star, good for O2O
& targeted fan
engagement
Under utilised with
good potential
Good platform for O2O
campaigns. Location based
check-ins
An SNS website for
blogging

11. STRATEGY 1: LISTEN
Brand Research: Louis Vuitton leads the luxury market’s online discussion in China.
Chanel commands high buzz volume and positive sentiment.
Category Overview: ‘Leather Goods’ (Bags) - the most discussed luxury category in
China.
Influencer Overview: The top 20% of netizens contributed 80% of the content in luxury
category. There are 4 types of luxury influencers shaping the conversation:
Shopaholic, Style Guru, Fashionist and Brand Fan.
Many brands already incorporate social listening and monitoring into their social media programs.
If you have not got an active listening program then you are missing significant inputs to your
strategy.

12. STRATEGY 2: KNOW & UNDERSTAND
China’s has a unique cultural context. For example, ‘shai’ 晒 (showing off) is very popular in
Chinese luxury & fashion BBS communities, accounting for an average of 90% of the
comments about luxury brands.
Globally speaking, China is positioned as ‘in the show’ stage of luxury consumption, going
through different stages of shai. Product Shai, True Man Show and Lifestyle Shai.
Overseas purchase and purchasing agents (i.e. Daigou 代购) are also hot topics.
Live broadcasting from fashion shows is a new way for Chinese netizens to keep in touch with
the latest fashion trends. Now ‘runway broadcasting’ is popular via microblog, incorporating
pictures, videos and real-time interaction.
Chinese luxury consumers are categorised in four groups: Aspirational Buyer, Quality
Pursuer, Status Seeker and Trend-Setter.

13. STRATEGY 3: PARTICIPATE
The microblog (weibo) offers brands a platform that is not only for listening but also for
actively participating in the online conversation. Think beyond single platform.
There are numerous engagement strategies that brands can employ to participate in the
conversation, including leveraging celebrities’ massive social reach to spread the brand
culture.
Brands should track social media accounts carefully to ensure they create content that
resonates with netizens and is appropriate for the brand’s voice.
Central to microblog engagement and any Chinese social media participation is a tone of
voice befitting your brand culture. So, luxury brands must find the luxury voice in social
media.

14. ABOUT DIGITAL JUNGLE
we are a specialist, digital marketing Agency that works with Western
organizations to market to a Chinese audience; living in China or abroad.

15. BEIJING SHANGHAI AUCKLAND SYDNEY
www.digitaljungle.com.cn