Luxury looks to the next phase of China's internet

Luxury brands need to succeed in China, and as the internet shifts to a new phase of embodied experiences and digital ownership, they need to understand how to proceed.

Why it matters

China’s internet is different, and rules around the emerging Web3 space – we’ll use this as shorthand for an internet of virtual worlds, avatars, and digital ownership – are shaping up to be different too. Yet there is enormous appetite for innovative experiences that can appeal to a luxury market that skews younger.

What’s going on

The Luxury Conversation has an interesting review of the ways luxury brands are engaging with a new and quite different space for brands to play in.

While the metaverse (metaverses, perhaps?) remains something of an abstract idea, means of virtual ownership and presence are increasingly important to brands’ future-facing plans.

NFTs

Critically, China requires trading platforms to control their blockchains as it wants to avoid the unregulated, permissionless, decentralised blockchains that are more typical in the West. While the country recognises the potential of these technologies for developers, it’s worth understanding what is and isn’t allowed.

Not wanting to be left behind, brands are still engaging with blockchain based assets in interesting ways. Burberry, for instance, showed how blockchains don’t need to be decentralised in order to host NFTs linked to physical items (NFT is the animal pictured above), as the luxury group did with a set of 1,000 limited edition scarves. This taps into a deeper proof-of-ownership trend that marketers should be aware of.

Virtual influencers and the metaverse

This idea has been around for some time, fuelled by the fact that virtual influencers don’t need to eat or pay rent, can be in two places at once, and don’t tend to harbour political or religious opinions. They do exactly what you tell them. The ‘human’ pictured above is one of these. 

While this area is similarly experimental, the opportunity lies in the potential to elide brand IP as it exists on more traditional channels with virtual worlds now and in the future.

What it’s all about

Web3 experiences developed around the world shouldn’t forget their commercial role. While much of the experimentation sits with marketing – given these technologies’ buzzy reputation – the ambition should be to think about how virtual ownership and presence can strengthen reach, connection, and even surface new opportunities.

Sourced from The Luxury Conversation, CoinDesk, WARC [Image: Tmall]