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3 Key Trends that Brands should take note of from L2’s Annual Digital IQ Index

E-commerce continues to rise

China’s e-commerce scene remains persistent with the trend seen over the last couple years, with an increasing level of luxury brands implementing e-commerce into their marketing strategies in one way or another.


  • 91% of Index Fashion brands and 60% of Index Watches & Jewelry brands offer come form of e-commerce.
  • 10% of Luxury brands are now experimenting with WeChat commerce as an alternative form of DTC (direct-to-customer) e-commerce, up from 3% in 2016.
  • Alternatively, Luxury brands remain wary of Alibaba’s Tmall, as just 3 brands (Tag Heuer, Pandora, and Armani Jeans) have launched official storefronts since Coach’s September 2016 departure.



The price gap persists

According to L2’s report, China’s luxury products continue to prove to be more costly than their western counterparts, ensuring that the Chinese will continue heading overseas for these goods.


  • 65% of Luxury Fashion products are more than 15% more expensive in China versus the U.S. whereas 20% of accessible Luxury Fashion brands’ prices are between 46 and 100 per cent more expensive in China than the U.S.
  • 31% of all Luxury Fashion brands are priced between 46 and 100 percent higher in China than the UK, ensuring that Chinese demand for overseas purchases will continue. However, brands continue to digitally underserve the traveling consumer.



The KOL and Celebrity Effect

In China’s digital scene, KOLs and celebrities continue to be a dominant presence on platforms like WeChat, Weibo, Youku and many more and for brands — including luxury brands — are as valuable as ever.


  • Posts made on WeChat by Chinese key opinion leaders that mention Index Luxury brands receive an average of 4x the views and nearly 8x the engagement than those of a brand’s own posts.
  • Likewise, Watches & Jewelry brands see upwards of 90 percent of their total engagement on Weibo coming from posts featuring celebrity ambassadors.
  • The report features platforms and e-tailers including but not limited to WeChat, Weibo, Youku, Miaopai, JD.com, Tmall, Farfetch, Yoox, Secoo, Xiu.com, and Mei.com.