Bruno Lannes Talk About The Trend Of Luxury Shopping Channels

The "2015 seventh Top Brand Summit Forum" jointly hosted by CEIBS and Jingan District people's Government of Shanghai was held in Shanghai in May 30, 2015.

Bruno Lannes, partner of Bain company, attended and delivered a speech.

According to the research of our consumers, the purchasing channels will increase in the future, and people's expenditure will also increase.

Now we can see that in 2013 and 2014, are you willing to purchase luxury goods by purchasing the questionnaire, from 59% in 2013 to 70% in 2014? If yes, if you will increase the purchasing expenses in the future, the answer is "yes", from 53% in 2013 to 59% in 2014.

The following is a record of the speech:

Bruno Lannes: it is a great honor to participate in this forum again. We are a partner of a very important leading brand Summit Forum, because this forum is not only in China, but also in the world. It is very grateful to China Europe International Business School and Jingan District government for building a forum.

Next, our guests will talk about China's top brands and the strategy of "Internet +" and e-commerce.

First of all, I would like to say that we have done a lot of research for Bain company, which can be found on our website.

In particular, the three types of research, in fact, we can get, if we get more details, there is no problem.

We have a report on Chinese consumers.

In the past 3 years, we released 8 copies in 2012, and we released 7 copies in 2007.

It also involves some information about luxury goods industry.

We released luxury goods reports in China and released global luxury reports. In the past few years, China's luxury report has become a reference in the industry.

Three years ago, we began to publish the "China electricity supplier report". We not only discussed luxury goods, but also related to the development of e-commerce industry.

If you can put all the research results together, I believe we can also give you a better understanding of the development of Chinese shoppers, China's luxury goods industry and China's e-commerce.

So I encourage you to read relevant reports on our website.

First of all, I will provide you with some questions to see how China deals with luxury goods in the digital age.

Here are some key trends. I would like to talk about it quickly, mainly to help you understand the situation in the electronic age.

First, one of our guests also talked about the slowdown in the development of China's luxury goods industry.

Chinese consumers do not mean to stop buying, but say that the growth of luxury purchases in China is slowing down, which began in 2014.

We can see that there are more and no clear boundaries in the segmentation of Chinese consumers.

The distinction between high-end consumers and mid - end consumers to buy luxury goods is becoming increasingly blurred. When they buy luxury goods, they also take into account its uniqueness.

At the same time, there are 20-40 year old people of different ages.

Another customer segmentation is segmentation based on their income.

There are also their tastes, including the meaning of this brand, which can be subdivided by customers.

This is very important for the market understanding of China's luxury goods.

Third and fourth, now we see that there are three periods of time in China's luxury industry. First of all, there is a rapid development of cosmetics in China. In the late 80s, accessories products developed rapidly, and they entered China with great opportunities. At the same time, Chinese consumers chose more accessories products.

The third round began in 2011. In 2011, it was affected by some factors, and there was some restraint on the luxurious way of life. Chinese consumers hoped to find some unique luxury goods or top brands at this time.

This is a new trend.

So I think it is not surprising that many of the winning brands have fashion content.

In addition, what we are talking about today is related to the Internet, and the channels and locations of purchase have changed significantly.

As Michel said before, many consumers now know more about the price difference. In this case, they will do some arbitrage behavior. They will buy this kind of purchasing agent, and even if they do not need to travel abroad, they can get the goods purchased.

In 2015, we said that the new benchmark reset would be settled. The brand is reinvigorate the core network and strive to cater for consumers who know more about luxury goods and have more experience in buying. It is expected that each category will achieve more conservative growth in the coming year.

The digital behavior of Chinese consumers has evolved rapidly around the three major steps.

First of all, more than 50% of consumers' shopping decisions are made online. Vertical websites and user word-of-mouth are the main driving force to help consumers make decisions.

Second, prices are still the main determinants of consumer purchase decisions. For some standard categories, such as consumer electronics and books, consumers are the first to consider the price, but for other categories, such as clothing and consumers, they are willing to pay premium for quality and authentic products.

Third, the enthusiasm of customers to advertise products and write comments is very high. Text reviews are more important than digital scoring.

The promotion role of sales is also more obvious.

Here we see more and more research work on the Internet.

Half of them actually buy online, and the other half are on the Internet.

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That is to say, we all get information from the Internet, but at the paction stage, half of them are in the net, and half of them are online.

He can get brand information through WeChat, family and so on, and understand their experience in this brand.

Let's take a look at this luxury brand. This is a report from luxury goods.

We see that the Internet has now become the most important source of consumer information.

Far beyond the influence of magazines and friends.

On the right hand side, we can see that the brand official website is the main source of information.

Also, all brands have already made their website sinicization, and Chinese consumers can easily browse these pages.

In addition, general news websites are also important sources of information.

So the first step is online research and discovery.

People get information from the Internet, understand prices, understand products, understand consumer feedback and understand their experience! All these are achieved by digital platform.

The other is the paction stage, which is more complicated and I try to simplify it as much as possible, but this does not mean that all the problems can be explained.

This enables us to understand the characteristics of the luxury goods you sell online.

Vertical axis we see is the price, simply speaking, one is the discount price, the other is the full price, the horizontal axis is divided into three parts, one is the brand self operated website, the other is the independent platform, but is authorized by the brand website.

These brands and websites have agreements to allow these websites to sell their brands.

Those on the left are unauthorized.

This is a relatively simplified perspective.

We can see here that in this market, the purchasing market is very large.

In the middle part, we also see some full price websites, which are springing up.

Others are brand driven activities that are limited to panic buying.

The full discount website with little discount is also a new phenomenon, and has also achieved great success.

Because this platform is across many brands, there are designer brands and some old luxury brands are on it.

You can understand the trend of design now through these websites selling full price goods.

In this way, some designers will be very interested in these websites.

In addition, we need to know a little about these self - owned brand websites and full - price websites.

It has a small proportion of total sales today.

We think it accounts for only 5% of the total.

There are such websites, and later guests can also express their views.

I think the purpose of this website is not to do business, mainly to provide shoppers with information and a possibility if he wants to buy online.

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In a moment, I will say that we can see the different stages of the development of these purchasing agencies.

The first stage is that some tourists go overseas to buy some things and put them on Taobao to sell their things.

Now it is changing, and now there are some professional purchasing agents. They have some professional relations in the US and Europe, and then they buy a lot of them and sell them on Chinese websites. There are some platforms that exist, and they can rely on the third party logistics organizations, and even websites help them point the best consumers in China.

Michel Gutsatz has just talked about this. This is our latest report.

This is a prediction we have made. If you look at the large purchase amount of Chinese people.

Only 30% of the total sales are sold in the stores in the mainland of China.

Overseas purchasing accounts for 15% through friends, Taobao and professional sellers. The total volume of luxury purchases is 55 billion to 75 billion, most of which are cosmetics, and more than half of them are cosmetics sales.

There are also other important categories, leather goods and accessories, which are easier to buy, easy to identify, and can be brought in.

In addition, it is more difficult to buy Garments, which is why the development of garment brands in China is better than that of accessories. This is because the generation gap of garment brands is more difficult.

The trend is that according to the research of our consumers, the purchasing channels will increase in the future, and people's expenditure will also increase.

Now we can see that in 2013 and 2014, are you willing to purchase luxury goods by purchasing the questionnaire, from 59% in 2013 to 70% in 2014? If yes, if you will increase the purchasing expenses in the future, the answer is "yes", from 53% in 2013 to 59%.

When I make a report every year, we communicate with each brand. 30% of their marketing budgets are on the digital platform. Now, this piece of investment is increasing, and more and more magazines are being replaced. This is because young consumers get information from the Internet.

And most shoppers in China also get information through the Internet.

This is the 2013 figure. Here are some examples. Some brands use digital platforms, and even some brands use one-way communication at that time. There is no opportunity for interaction.

Now we see that this can provide consumers with more interactive opportunities, such as Chanel and so on, more and more consumers communicate with each other, making use of all potential of the digital platform.

There are many reasons and reasons for your interaction and feedback.

This is our conclusion from some data, which is about luxury products. On the left hand side, we get Tmall's different stores.

On the right hand side, we compare the situation of these different Tmall stores every month.

We scored from 0-5.

First of all, we see that scoring is relatively high, 4.8 or 4.9, that is to say, consumers' feedback on this is still very high.

But there is no strong positive correlation with actual sales.

On the right hand side, we see that the correlation between sales and text reviews has become very strong.

That is to say, the correlation with score reviews is weak, and the correlation is strong.

That is to say, the positive correlation between sales volume and text reviews is obvious.

That's why many luxury brands are using interactive channels.

I'll talk about it. Next, we can invite our guests to come to the stage.

Finally, we can do some questions and answers.

Thank you.