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The China Edit | Asos China, DFS Expands, High-Income Households, Tencent Outside China, E-Commerce

The China Edit is a weekly curation of the most important fashion business news and analysis from and about the world’s largest luxury market.
Asos Spring/Summer 2013 Collection | Source: Asos
By
  • Lina Lee,
  • Lisa Wang

"Asos is on the brink of breaking into China’s booming e-commerce market, further broadening the online fashion retailer’s global reach. Asos, which on Wednesday reported a near-40 percent year-on-year jump in its annual revenues to £769.4m in the 12 months to August 31, said that its Chinese operations were 'now in [their] final testing phase and will be launched imminently.' 'We have a dedicated Chinese-language site initially offering about 2,000 locally relevant own-brand styles, an in-country multidisciplinary team, dedicated delivery solutions and payment methods, local language customer care and a domestic distribution partner,' the group said."

"LVMH's DFS Group Plans to Open First Europe Shop in 2016" (Bloomberg)

"DFS Group, an operator of duty-free shops controlled by LVMH Moet Hennessy Louis Vuitton SA, said it plans to open its first stores in Europe to cater to Chinese consumers who travel more frequently to the region. The company plans to add 'a few' outlets in Europe in 2016 and is looking at prime destinations for Chinese tourists, such as France, Italy and Switzerland, Chief Operating Officer Michael Schriver said. DFS, which gets more than half of its global sales from Chinese shoppers, currently has no outlets in Europe."

"Luxury Retailers to Cash In as Chinese Households are Richer Than You Think" (The Financial Post)

"If economist Wang Xiaolu’s study is correct and Chinese households have much more income than official data suggests, it bodes well for the country’s leading luxury goods companies. The third edition of Wang’s Chinese Grey Income study, published on Monday, noted per capita income should be 3.2 times higher than the National Bureau of Statistics suggests for the top 10 percent of households."

"The Chinese Are Coming: Rumored Tencent Investment in Snapchat Highlights Growing Sino Tech Influence" (Pando Daily)

"A Snapchat investment, rumored to be in the hundreds of millions of dollars, would be a milestone for Tencent, which with a $100 billion market cap hovers around the fringes of the world’s top five Internet companies, and its most obvious signal to date that it is deadly serious about establishing itself outside China. In June, Tencent took part in a $150 million funding round for online retailer Fab, which valued the company at north of $1 billion. In 2011, it acquired Riot Games for about $400 million, and last year it paid $330 million for a 40 percent stake in Epic Games."

"Western Retailers See Online as Ticket to China" (The Wall Street Journal)

"The promise of e-commerce in China has attracted foreign companies for years. Yet Western companies, such as eBay, Google and Groupon have struggled in China, partly because of competition from domestic giants. Western retailers also have had concerns about the difficulties of distribution in the country and its Web shoppers' insistence on low prices. But China's e-commerce — which, by some measures, overtook the U.S. this year as the world's largest online retail marketplace — has become too big to ignore. Online retail sales in China are expected to reach about $540 billion by 2015, compared with roughly $345 billion in the U.S., according to consulting firm Bain & Co. China's online retail sales have increased more than 70 percent annually since 2009, compared with 13 percent in the U.S."

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