How Your Luxury Brand Can Reach Consumers In Lockdown

With the coronavirus continuing to impact everyday lives and analysts predicting the worst economic downturn since the Great Depression in the 1930s, it’s no wonder why consumer confidence has plummeted, and sales of all-but-essential goods have dropped considerably.

In China, early lockdown restrictions were labelled a ‘disaster’ for the luxury goods market, and though ecommerce has plugged the hole, Chinese buyers are still reluctant to shop and part with their cash. Fashion shows and exhibitions are cancelled, and brands have closed or restricted their store openings, though companies like Apple are slowly reopening outlets.

If you sell luxury goods, you’ll no doubt be feeling the pinch. According to McKinsey, 20-30% of revenue in the luxury goods sector is generated by shoppers purchasing from outside of their home country. Chinese buyers, in particular, took more than 150 million trips abroad in 2018, with trips accounting for half of the country’s luxury spending. With international travel suspended for many months to come, that could mean catastrophe for some firms.

Data suggests that sales for this year’s spring season have fallen by as much as 70%, as consumers couldn’t touch and feel fashion and high-end merchandise. And considering Chinese consumers like to buy luxury goods abroad to benefit from lower prices and unique shopping experiences, it’s clear that the market is going to suffer for a considerable period.

The good news, though, is that there are ways to adapt your luxury goods business and reach Chinese consumers in lockdown. Below, we’ve rounded up some of the best…

Work with influencers

Understandably, the coronavirus pandemic has had a major impact on influencer marketing, with income dropping by as much as 95% in some parts of the world. In China, where the COVID-19 pandemic began, influencer marketing has been badly hit, with income sources disappearing overnight as brands pull their deals and sponsorships over the coronavirus.

And for influencers who’ve created their own brands or sell merchandise, manufacturing has been moving incredibly slowly, and thus influencers are more likely to work with businesses and reduce their asking prices. For luxury goods brands like yours, that’s good news: you can score a winning deal with an influential figure on WeChat without breaking the bank, and piggyback off their millions of followers to promote your brand and drive ecommerce sales.

Update your app with augmented reality

Whether you’re selling skincare, home interior products or handbags, taking advantage of new emerging technologies can help you replicate the in-store shopping experience when your customer base is staying put at home. Augmented reality has exploded in popularity during the pandemic, with brands like Gucci allowing consumers to try on hats, lipsticks, and clothing; even decorate their home with premium Gucci furniture like chairs and wallpaper.

Once shoppers find a product they want to purchase, they can add it to their basket and complete the purchase within the app. You can replicate Gucci’s success without spending tens of thousands on app development with your own WeChat Mini Program, tapping into existing APIs and ecommerce tools to offer your followers a fun, engaging experience.

Live stream product demonstrations

Whether you’re fluent in Mandarin or have a local spokesperson who can sell the benefits of your product to potential customers, live streaming on social networks can prove to be an effective sales mechanism. However, you should focus on personality and authenticity.

Consider scheduling a series of online events where you can demonstrate your products in real-time. Makeup brands can show off a new palette and deliver a makeup tutorial whilst businesses in luxury food and drink can prepare a meal and let their followers “cook along”.

The key here is not to explicitly sell, but demonstrate your passion and craftsmanship - if you position your brand as a genuine authority in your niche, users will naturally buy from you.

Host talks and Q&As

In the same vein, you could consider hosting talks and question and answer sessions with followers on WeChat and Youku. You can go behind the scenes at your whisky distillery to show your customers how it’s made and answer questions on your product, or even feature senior members of your team and interview them one-on-one over a Zoom call to reveal the “secrets” of your business and the ways you’re adapting to keep customers and staff safe.

It’s important to note that consumers might not be buying from you when they watch these informal live sessions, but if they’re willing to give up their time and commit to your brand, they’ll almost certainly follow you and check out your e-commerce store if they’re interested.

Give stuff away

As a luxury goods retailer, you can’t offer freebies to everyone, but you can tap into trends to give back to your customers at a time of crisis. High-end shoe Spanish designer Manolo Blahnik, for example, created a free book of shoe sketchers that can be printed off for free to relieve stress and get creative, and users can tag their finished artwork on social media.

Your free resource doesn’t necessarily have to relate to your business, either. Anything that promotes mental and physical wellbeing will go down well with your customer base and will also help you score some much-needed positive PR on Chinese news websites and blogs.

Anticipate demand and behaviour

Though progress has been made in China and some parts of its economy are showing signs of recovery, it’s important to be realistic and predict consumer behaviour and demand for the year ahead. That might mean scaling back production on your next collection or even cancelling or postponing product launches until there’s a more appropriate time to hit “go”.

You should also accept that post-crisis, the world may change permanently. Consumers will be less willing to travel overseas in the short-term, meaning Western luxury brands without a physical Chinese presence should invest in e-commerce, and consumer attitudes towards the environment will also change, and your marketing and delivery should reflect that.

It has also been suggested that consumer preferences may change post-crisis, with buyers preferring classic luxury pieces over “bling” and “on-trend” merchandise. Your audience may also change, with some middle-class consumers reassessing their finances and shopping habits, investing in high-end goods to treat families and make the most of life post-lockdown.

How is your luxury goods business faring during the crisis? Have you already adapted your strategy? Join in the conversation on Twitter and reach out to the team at Zudu if you are looking for assistance promoting your luxury goods business in China during the pandemic.

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