In 2019, parent company ByteDance launched an e-commerce division to integrate commerce with its content platforms. “For that, Douyin is a perfect match.” A very competitive arenaĭouyin’s ambitions in the e-commerce sphere have been clear for some time. A return on investment is likely to take time, so brands should prepare for a mid- to long-term commitment and focus on entry-level products that resonate with a very young audience, says Gatti. There will be no easy wins for luxury brands in an ultra-competitive market, warns Mazor-Freeman. “Converting on Douyin itself creates a closed e-commerce loop, which makes total sense from a brand perspective.” “ brands spent a lot of money generating content, but then they lost the consumer, so in the end, they had no idea of how much of their investment and advertisement did convert users into shoppers,” says Elena Gatti, managing director Europe at China e-commerce consultancy Azoya. “It’s hard to ignore Douyin’s significance as a platform that attracts China’s younger online population.” The brand reports “pretty successful” sales on the app.īy processing transactions directly on Douyin flagship stores, brands can retain consumer data previously lost to third-party platforms. “We live in a digital age in which the success of future-oriented fashion business is closely associated with how it connects with Gen Z and millennials, who are the digital natives,” says Wei Li, director of the e-commerce strategic business unit of Peacebird Women, one of China’s largest domestic apparel companies, which has a flagship store on Douyin. This generation is already a significant contributor to the latest surge in luxury spending in China – it’s the fastest-growing demographic in Tmall’s luxury fashion and lifestyle market.Ĭhinese brands know this all too well. According to Insider Intelligence, they account for nearly half of all Douyin users. The biggest upside of opening a flagship store on Douyin is the opportunity to connect with China’s Gen Z netizens. “I know for a fact that fashion and jewellery brands are looking into it now - it’s a work in progress,” says Mauron. Now that the app’s role as a strategic communication platform for luxury brands in China has been clearly established, expect faster progress in the months ahead. cn brand sites and Tmall flagship stores, points out Asa Mazor-Freedman, specialist advisor at Gartner.Īccording to Mauron, this is a familiar route: domestic, mass-market and beauty brands serve as early adopters, with luxury brands as more cautious followers. Some brands, including Tiffany & Co., Celine, Gucci and Chloé, are making limited use of Douyin’s e-commerce offering by linking products to. Over the last three years, brands like Burberry and Prada have created branded accounts, primarily for marketing and advertising purposes. That hesitancy is par the course for luxury brands, who took several years to even test Douyin. “We would not take such a step until totally satisfied that everything was in place to meet our requirements, and thus correspond to the expectations of our clientele.” The luxury brand opportunityįor Dior, which launched its official account on the app in April 2018, the viability and effectiveness of launching flagships on Douyin is something for further down the line, as the app is still going through a process of development, a spokesperson said. Founder Zhang Yiming surprised investors this month by announcing he is stepping down as CEO ahead of a planned IPO: analysts have speculated that this was a pre-emptive move to reassure the government. This success has not left Douyin owner Bytedance immune to the ongoing Chinese government pressures on big tech companies. Since its launch in 2016, Douyin has grown exponentially, surpassing 600 million daily active users and adding popular capabilities like live streaming, which last year helped the app to reach a reported RMB 170 billion ($26.4 billion) in gross merchandise value. “Douyin represents the only way to have live streaming with a broad audience that potentially generates direct sales outside of the Tmall ecosystem. That’s why the luxury industry is looking very seriously at this opportunity,” says Pablo Mauron, managing director China and partner at Digital Luxury Group. “What bring is an ability to monetise the attention Douyin triggers in an even more seamless way. The app now wants to keep that traffic in-house and capitalise on its ability to build awareness and brand engagement. Douyin has proven successful in driving traffic generated by its highly entertaining content to other e-commerce platforms and has enabled some luxury products to go viral.
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