Secoo sells luxury items at prices no one dares to sell at and in 2014, great changes took place in China’s luxury e-commerce market. China’s cross border e-commerce has increased sharply since last year. The number of Chinese consumers participating in cross-border e-commerce reached 35.60 million persons and the trading volume exceeded 1.8 trillion yuan in 2014, according to the data of China E-Business Research Center. Other data shows that Chinese accounted for 76% of the total overseas luxury consumption and bought 46% of global luxury items in 2014.
There was a bizarre reversal in the luxury market of China in last year with fewer and fewer Chinese consumers choosing to buy luxury items locally, and luxury shopping malls sales posting a large decline. In 2014, HUGO BOSS closed 7 stores in China, Zegna closed 6, Burberry closed 4, and the number of large chain department stores slated for closure reached 38. There have been department stores announcing closure in Tianjin and Beijing, etc. since this year. In the meantime, the number of luxury shopping malls with negative growth in net profit is increasing: LVMH declined by 5%, Richemont declined by 4%, France Kering declined by 9%, and SWATCH Group managed to maintain 1% positive growth.
While the domestic luxury market cools and brand exclusive shopping malls continue to struggle, cross-border e-commerce continues to grow. According to third-party statistics, about half of Chinese cross-border e-commerce orders in 2013-2014 was from Amazon China; and just in Shanghai, over 90% overseas import shopping orders were from Amazon.
The increasing popularity of overseas luxury item shopping has brought a good development opportunity for Chinese cross-border e-commerce.
China’s Luxury E-commerce Prayers
Li Rixue, CEO of Secoo
Daring to Promise Chinese Consumers that They Can to Buy the Most Affordable Luxury Items
Firstly, Secoo, as a retail partner authorized by global multiple premium mid- to high-end brands in China, has an obvious edge over the exclusive shopping malls, establishing its leading status and voice in the industry. Secondly, it implements close cooperation with multiple overseas premium resellers on the supply chain, with long-term agreed bulk procurement, becoming the strongest first stop to shop overseas luxuries. Thirdly, increasingly more high-end brands and foreign and domestic famous shopping malls cooperate with Secoo successively, to authorize Secoo to sell “first-launched” or customized styles of products in the Chinese market; the commodities are directly from the overseas sources, reducing the intermediate link and enabling consumers to enjoy the latest and best-quality commodities of the season, with preferential prices.
Secoo, the largest luxury online cross-border mall in China, was one of the first domestic “cross-border layout” e-commerce platforms.
Firstly, Secoo has established solid cooperative relations with multiple overseas brand owners, channel vendors and logistic providers; it provides customized and personalized supporting services for participating vendors which can independently select the Secoo-exclusive domestic and foreign ports and supply chain service system. The nobility of international luxury brands is fully maintained through direct supply. While under the situation of lack of source of goods, Chinese local luxury e-commerce companies need to work hard to maintain the source of goods via procurement service, procurement by overseas wholesalers, professional buyers or procurement of leftover stock, etc.
Secondly, Secoo, through 7 years of serving the public, possesses extensive data about Chinese high-end consumer market and users. These users refer to “Secoo price” at first for price comparison; they will first “ask Secoo” for online shopping of luxuries, like some internet users “ask a search engine” when surfing the net.
Thirdly, the overseas experience stores and member centers of Secoo spread in the top trade areas of the “five fashion cities”:Beijing, Shanghai, Chengdu, Hong Kong, and Milan; Secoo possesses the world’s largest luxury maintenance factory and the most professional luxury identification team in the country, with each product passing multiple times of cross identification for ensuring 100% genuineness, and can provide high quality consumers with multiple customized services covering shopping, experience, appreciation and maintenance.
The “Secoo price” proposed by Secoo, a service platform for global high-end consumption, is a solemn promise to provide consumers with more first-class cost performance during procurement of luxuries, and more perfect after-sales experience. The “ask Secoo” before procurement of luxuries will also help the cross-border e-commerce market trend and the bolster China’s Internet industry in the area of luxury e-commerce.