Foreign retailers go online in China

25 May 2012

BEIJING: Overseas retailers are taking a varied approach as they seek to crack China's ecommerce market, with firms like Macy's, Neiman Marcus and Metro all attempting to gain ground.

Macy's, the department store chain, recently paid $15m for an undisclosed equity stake in VIPStore, the owner of, a new digital platform selling luxury and fashion brands.

The US organisation will begin by offering private label ranges like I.N.C. on, which is targeted at "style- and trend-conscious" buyers. VIPStore also runs, a flash sales site.

"We continue to believe there is significant long-term opportunity internationally for both Macy's and Bloomingdale's. But we need to be certain that our future decisions in this regard are based on fact and experience," Terry Lundgren, the firm's CEO, said.

"We still have a great deal to learn about the shopping patterns and merchandise preferences of consumers in China's very diverse and rapidly emerging consumer marketplace."

Earlier this year, Neiman Marcus, from the same sector, splashed out $28m to acquire a share in Glamour Sales Holding Ltd, another fashion site in the world's most populous nation.

"We are taking this bold step to establish Neiman Marcus Group as an international brand," said Karen Katz, CEO of Neiman Marcus. "Anyone who sells luxury has to be looking at China today."

The objective, she added, was to create a "full-price, multi-brand" platform which combined the expertise of Neiman Marcus with the consumer insights of its Chinese ally.

For its part, Walmart, the US retailer, is awaiting regulatory approval for its bid to take a 51% share in Yihodian, an online grocery specialist. Auchan, its Dutch rival, has also become one of the first chains to trial "click-to-collect" services in the country.

Metro, the German hypermarket and consumer electronics group, launched its own business-to-business ecommerce site this month, having found 90% of web sales are attributable to this category.

"We hope to enlarge our customer base and increase sales through e-commerce. I cannot reveal the exact amount of investment in the online store, but it amounts to hundreds of millions," said Feng Liu, vice president of Metro China.

J Crew, the apparel chain, is in the process of considering branching out into several Asia outlets, but has already launched a retail website covering 107 markets, which it called "an e-commerce first", as it offered access to its whole collection.

Elsewhere, GSI Commerce, an arm of eBay, has formed a tie-up with Fireswirl, a digital retail services provider, to help many of its 1,000 clients expand locally. "GSI wants to facilitate its clients' speed to market in China," Tobias Hartmann, CEO, global operations, at GSI.

Data sourced frm Wall Street Journal, Economist Intelligence Unit, Global Times; additional content by Warc staff