Content thumbnail Luxury and Cosmetic Financial Factbook

DCF and vIndustry oaluation pverview arameters PPage 47age 47 I Points of view from EY global sector Digital tango with China and other industry professionals In particular, in China, customers are used to paying (>$US26,000 in yearly disposable income) and one potential way for luxury brands to secure China with modern mobile payment methods that only need afÖment homseholds 6MK,.,((( in qearlq sales. a fingerprint and three seconds per transaction. disposable income) of lower tier cities, will be driving The imestion is ohether lmxmrq homses shomld innest Lhese cmstomers first encomnter brands on digital the growth potential for luxury brands in the coming in their online presence instead of their ofÖine channels, so brands must manage their digital years. presence, or invest in a combination of both to channels for the brand ambassadors that they are, In the past, luxury brands in China were reluctant to attract future consumer growth and the millennial focmsing on specific digital marceting dedicated to try the online channel. However, with the generation in China as well as to pioneer an unrivaled cmstomers on first contact. Lo reach this enormoms development of cross-border online platforms and customer experience worldwide. w market, marketing and branding strategy need to be the popularity of traveling to buy foreign goods, localized. The “digital conversation” with Chinese ervie especially luxury goods, the online marketplace is v consumers is a totally different game than dialogue try o with Western consumers. Chinese consumers like Indus more storytelling and have higher expectations in terms of delivery lead times and customer care What gZslacles dg lmpmjy Zjands ^ace in l`e di_ilal eajcelplace7 imalitq, as theq are accmstomed to msing highlq Image - The most important concern for luxury brands is their brand image and exclusivity. Online shopping is, in general, associated with responsive and sophisticated platforms. shopping in a marketplace for cheap buys, which should be fast and convenient, whereas luxury goods are relatively expensive and not necessarilq imicc or connenient to pmrchase. Hrodmcts being anailable online might impact their lmxmrq image. Digital luxury strategy capturing the Chinese Grey market/fake/Daigou - Luxury brands do not wish to be associated with fake goods being sold via e-commerce through unauthorized channels. Degal action has been an important tool in fighting this tqpe of comnterfeiting. É

Luxury and Cosmetic Financial Factbook - Page 49 Luxury and Cosmetic Financial Factbook Page 48 Page 50