Fashion giants fail on digital in China

22 March 2013

BEIJING: Two-thirds of luxury fashion brands in China have been "feeble" when it comes to leveraging the opportunities provided by digital media, a study has argued.

Only four such brands – Burberry, Louis Vuitton, Chanel and Coach – were categorised as "gifted" in a report by think tank L2, which benchmarked the digital competence of 27 global operators in China, none of which achieved the top rating of "genius".

Gucci and Armani were "average", while Dior, Dolce & Gabbana and Hugo Boss were "challenged", the analysis added.

The report, a Fashion Supplement to L2's Digital IQ Index: China, considered four features: websites, social media, mobile and digital marketing. It found that the overall "IQ" of fashion brands was down by 12% on the previous year, as they have been slow to localise content and launch ecommerce platforms.

L2 cited the example of Diane von Furstenberg, which can claim more than 1m fans on Sina Weibo, the microblog, but has yet to establish a Chinese-language website.

Website functionality also varied widely. More than 75% of brands had a store locator for China, but only 44% offered Chinese social media sharing tools and just 37% had a local customer service number.

Most brands did have a social media presence, with Coach using seven such platforms. Some 59% featured on at least two, but three brands – Chloé, Prada and Ralph Lauren – were not on any.

When it comes to search, the report noted that brands control just 6% of paid search real estate for brand-relevant terms, with third-party retailers being particularly aggressive in purchasing these ads.

Just four Chinese-language fashion sites appear in the first position in organic results on Baidu and So.com for brand term searches, while two are first on Google's site in Hong Kong.

One brand, however, did demonstrate a marked improvement: Armani was up by 23% year on year, moving from "challenged" to "average" as it ploughed investment into both online and offline channels. The report noted the strength of the brand's email marketing and the internet buzz generated by a live-stream of one of its Beijing fashion shows.

Data sourced from L2; additional content by Warc staff