Xiu.com screenshot | Source: Xiu.com

We continue this week’s focus on e-commerce by turning our attention on how to succeed in the rapidly expanding e-commerce market in China. 

BEIJING, China — According to a recent report by The Boston Consulting Group (BCG), China is set to become the world’s next e-commerce superpower, surpassing the United States to become the largest online commerce market in the world, with an estimated market size of $300 billion. In 2006, less than 10 percent of China’s urban population shopped online. By 2015, that figure is expected to have quadrupled, reaching 44 percent, while the total number of e-commerce shoppers in China will grow to 329 million.

What’s more, according to BCG, China’s massive geography, a middle class that is rapidly expanding beyond the country’s largest cities, and widely accessible, heavily subsidised high-speed internet — broadband in China costs just $10 per month, compared with $30 per month in India — make the country unusually fertile ground for e-commerce, with internet access far outpacing the reach of physical retailers. Indeed, up to a quarter of e-commerce demand in China is for products consumers cannot find in physical stores, with apparel and skincare amongst the fastest-growing online categories.

But for fashion companies aiming to crack the online retail opportunity in China, it’s imperative to understand that the country’s e-commerce market is very different to established markets in the United States and Europe and that online shoppers in China — much younger, on average, than their Western counterparts — have different expectations, preferences and patterns of behaviour.

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Lane Crawford Autumn/Winter 2011 | Source: Lane Crawford

Are Chinese Models Putting An End To Asia’s Colonial Mentality? (Forbes)
“If we were to take our cues from the fall 2011 advertising campaign of luxury retailer Lane Crawford, it would seem that we Asians have come to love our own. The campaign features a stunning all-Chinese cast wearing the latest threads from New York, Milan, London and Paris… Is the Chinese luxury consumer now aspiring to be like the Chinese faces modeling her favourite brands?”

The Muddy Roots of Fine Linen (WSJ)
“Linen has become a high-end staple on the designer-clothing racks… Yet these thousand-dollar linens have humble roots. Two-thirds of the world’s linen originates in a narrow belt of farmland that stretches from northern France to the Netherlands… Fashion brands are telling consumers more about the origins of their clothes. Linen, because it comes from such a limited region, is able to ride this movement.”

Frida Giannini by Dave Gahan (Interview)
“Giannini has acquitted herself ably on all fronts, crafting a new chapter in the Gucci story by embracing her own ultra-feminine take on fashion, one that doesn’t so much wrestle with what was, or the iconographic power of those interlocking Gs, as display an unbridled enthusiasm for what is and what might be if we could only find a way to chill out and live in the now.”

Adding a Splash of Luxury to Swimwear (IHT)
“The French company Eres isn’t interested in runway shows or fashion weeks, and it has always shunned the annual Miami event, deciding to keep its beachwear firmly under wraps… Instead, major global buyers and journalists make a by-invitation-only pilgrimage twice a year to the company’s headquarters in Paris to discover in which direction the swimwear fashion current is flowing.”

Kanye West steps into stilettos (Telegraph)
“Women’s Wear Daily have revealed that Mr West – who has footwear ‘previous’ as a sneaker designer for Louis Vuitton – is beavering away on a line of stilettos with help from cobbling maestro Guiseppe Zanotti… ‘Kanye is always here in my factory. In the last three years, he has come here maybe every month… [Kanye] loves learning about shoes, both the design and construction, and we’ve tried to design something together.’”

Reiss Shola dress, worn by the Duchess of Cambridge | Source: Reiss

Kate Middleton: putting the regal into Reiss (Telegraph)
“‘The Reiss dress was perfectly pitched… Britain has the best high street in the world. No one exemplifies the strength of that better than the Duchess of Cambridge.’”

Knitting pretty (FT)
“As well as giving Pringle a youthful burst of creativity, the Archive Project provides the brand with a reputation for supporting new talent… ‘This makes them appeal to a younger demographic.’”

Ferragamo May Seek Higher IPO Rating Than Prada (Bloomberg)
“[Salvatore Ferragamo] may seek a higher valuation multiple than its bigger rival Prada SpA… [the company] may be valued at as much as 2.25 billion euros ($3.2 billion), or 26 times estimated 2012 profit.”

Phillips-Van Heusen first quarter beats; raises FY view (Reuters)
“Phillips-Van Heusen Corp raised its full-year outlook and posted first-quarter earnings that beat market expectations as revenue more than doubled on strong sales in its Tommy Hilfiger and Calvin Klein businesses.”

How To Sell Luxury To The Chinese (Forbes)
“[A] chat with Lane Crawford’s fashion director Sarah Rutson — a much-photographed street style blog star — on the evolving taste of the Chinese consumer, the brands they favor, and her role in the global fashion community.”

BEIJING, China – My first glance at Beijing’s brand new airport (BCIA) was also the first sign of China’s stylish transformation since my previous visit here 7 years ago. I couldn’t take my eyes off the ceiling, which seemed to go on forever, as I zoomed through immigration and retrieved my bag. I was in and out in less than 30 minutes.

When I commented on the airport’s breathtaking design and efficiency to locals, they proudly informed me that BCIA was completed in only 4 years and has run without a hitch from day one. This is particularly notable when compared to the disastrous opening of London Heathrow’s Terminal 5, which opened around the same time as BCIA, but took 6 years to build and is still not running as expected. And, the success of BCIA also provides the perfect analogue for China’s nascent fashion industry.

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