THE WORLD LUXURY INDEX China 2013 THE MOST SOUGHT-AFTER LUXURY BRANDS

Transcription

1 THE WORLD LUXURY INDEX China 2013 THE MOST SOUGHT-AFTER LUXURY BRANDS Photo architecturepics.org In partnership with:

2 A New Luxury Benchmark is Born. Created as a way to provide luxury brands with a standardized way of measuring brand interest at an international level, Digital Luxury Group, in partnership with Luxury Society, unveils: The World Luxury Index. An international ranking and analysis of the most searched- for brands within the luxury industry. Digital Luxury Group, SA 2

3 A Market with Untapped Potential. "ʺThe potential in China is so important. You might have a slowdown there, but the tank is so big. There are so many cities where we have not scratched the potential yet Bernard Fornas Co- Chief Executive Officer of Richemont - Riding the Tiger of Luxury, WSJ, March 18 th 2012

4 The World Luxury Index China Covering: 400+ brands 680 million+ searches* 6 Key Segments Cars Fashion Beauty Hospitality Jewelry Watches Unbiased insights from the top search engines in China: Digital Luxury Group, SA * From Jan - Dec

5 WHAT ARE THE MOST SEARCHED LUXURY BRANDS IN CHINA? Digital Luxury Group, SA 5

6 TOP 50 MOST SOUGHT-AFTER Luxury Brands in China. 1 Audi 26 Armani 2 BMW 27 Tiffany & Co. 3 Chanel 28 Swarovski 4 Estée Lauder 29 Jaguar 5 Louis Vui`on 30 Bentley 6 Lexus 31 Maserati 7 Mercedes Benz 32 Rolls Royce 8 Dior 33 Sheraton 9 Porsche 34 Biotherm 10 Lamborghini 35 Maybach 11 Lancôme 36 Omega 12 Gucci 37 Lincoln 13 Hermès 38 Borghese 14 Volvo 39 Hilton 15 Land Rover 40 Clarins 16 Infiniti 41 Benefit 17 Chow Tai Fook 42 Acura 18 Cadillac 43 Elizabeth Arden 19 Cartier 44 Versace 20 Clinique 45 Anna Sui 21 Burberry 46 InterContinental 22 Coach 47 Rolex 23 Ferrari 48 Guerlain 24 Prada 49 Longines 25 Shiseido 50 Rado Digital Luxury Group, SA Data range: Jan - Dec

7 Top 3 Brands by Segment. CARS FASHION BEAUTY HOSPITALITY WATCHES JEWELRY #1 #2 #3 Digital Luxury Group, SA 7

8 Brands Who s IN/OUT. Brands entering the top 50 for the first time: (# 43) (# 50) Brands no longer in the Top 50: (was # 42) (was # 48) Digital Luxury Group, SA 8

9 A Market Going Independant. Many brands expected that an increase in Chinese sophistication would reduce the cultural gap with their overseas consumers. In some cases, it actually contributed to the development of unique local preferences, independent from Western tastes, thus challenging luxury brands in terms of product offering but also opening up the way for new opportunities to grow in the Chinese market. Pablo Mauron General Manager China at Digital Luxury Group Photo Qeelin

10 Chanel Oversteps Louis Vuitton Rank 2011 Rank Chanel #3 #5 Louis Vui`on #5 #3 Chanel is benefiting from an important level of interest in China, mostly emanating from strong interest from Chinese consumers in its Beauty products, which Louis VuiSon does not have. David Sadigh Founder & CEO of Digital Luxury Group 10

11 Cars Lead. Cars remains the most searched for luxury sector in China BREAKDOWN BY SEGMENT Digital Luxury Group, SA 11

12 How Chinese Consumers Search for Brands? Language barriers continue to create complexities between Chinese consumers and Western luxury brands. Almost 40% of searches are for either non- official or original brand names, whilst the remaining searches are for their official Chinese name. Echo Zhiyue ZHOU ( ) China Digital Strategist, Digital Luxury Group Digital Luxury Group, SA 12

13 How Chinese Consumers Search for Brands? Chinese consumers search for brands in various ways, reflecting how they are being remembered in the mainland. Brands should keep this in mind when developing their communication strategies for China, especially new brands entering the market. Consumer Search Pattern for Brand Names on Search Engines and E-commerce Sites 1% 3% 6% 10% 30% 20% English acronyms or others Variation of search pa`erns between segments: The Beauty segment has the highest ratio of Chinese brand names 62% 66% Non- official Chinee name Official original name Official Chinese name Fashion is the segment most searched in brands original names, but also in acronyms *Benchmark study and analysis jointly conducted with: Search engines E- commerce sites* Digital Luxury Group, SA 13

14 Differences between Individual Brands. Non- official name, a misspelling of the official one Tiffany & Co. 8% 19% Non- official name, given by retailers before the brand s official entry into the China market in 2004, is still very popular 28% Lexus 73% 5% 67% Searches for and, both misspelling of the official Chinese name 29% Gucci 8% 63% The official Chinese name is li`le known in China Estée Lauder 5% 95% Estée Lauder is overwhelmingly recognized by its Chinese name, because of the brand s consistent communication but also the difficulty to remember the original name for Mandarin speakers Digital Luxury Group, SA 14

15 Cars Digital Luxury Group, SA 15

16 Top 10 Car Brands in China. (/)* #1 (/) #6 (/) #2 (/) #7 (+1) #3 (+1) #8 (-1) #4 (-1) #9 (/) #5 (+1) #10 Digital Luxury Group, SA 16

17 A Race of Cars. Top rising brand Jaguar (+5) Top declining brand Maybach (-10) Evolution Rank 2012 Brand Name Jaguar Cadillac Lincoln Rolls Royce Land Rover Bentley / 1 Audi / 2 BMW / 6 Lexus / 9 Porsche / 10 Lamborghini Infiniti Acura Volvo Mercedes Benz Maserati Ferrari Maybach Digital Luxury Group, SA 17

18 Jaguar - Rising Star. China is now the 1 st market for Jaguar. Sales have increased by +74% in 2012, compared with +4% average growth rate for the overall car market The joint venture with Chinese local brand Chery has triggered a lot of interest and is also Jaguar s 1 st joint venture outside the UK The 1 st manufacture sector of Jaguar outside the UK is located in China Jaguar has paid great a`ention to product customization for the Chinese market (3.0 L engine, long wheelbase, etc.) Photo autoguide.com Jaguar 4S stores in China are equipped with golf practice fields, massage rooms, internet bar etc., to take care of Chinese consumers unique needs Digital Luxury Group, SA 18

19 Jaguar - Rising Star. This year Jaguar Land Rover expects its China sales to increase between 20% and 30% over 2012'ʹs sales, while growth in Europe is expected to increase only by a single- digit percentage rate. Total investment in its China strategy over the past three to five years was way past 1 billion - Investment in its joint venture with local car maker Chery Automobile Co. accounts for roughly half. Under its joint venture agreement, JLR also must produce a brand specifically for the joint venture. "ʺ Phil Popham Director of Group Sales Operations, Jaguar Land Rover - Tata'ʹs Jaguar Expects China Sales to Leap Over Europe, WSJ, April 23 rd 2013 Digital Luxury Group, SA 19

20 Beauty Digital Luxury Group, SA Photo Shiseido 20

21 Top 10 Beauty Brands in China. (/) #1 (/) #6 (+1) #2 (/) #7 (-1) #3 (/) #8 (+1) #4 (/) #9 (-1) #5 (/) #10 Digital Luxury Group, SA 21

22 Skincare is King. The Chinese beauty market is dominated by skincare - unlike most Western and other BRIC markets Breakdown of Searches for Beauty Products in China Digital Luxury Group, SA 22

23 Breakdown by Category. Estée Lauder and Clinique, are winning over Chinese women s hearts thanks to strong skincare products 2% 12% 22% 6% 26% 22% 60% 17% 81% 86% 94% 56% 30% 57% 9% Estée Lauder Lancôme Dior Chanel Clinique Avg. (Top 5 brands) 15% 4% Digital Luxury Group, SA %Skincare %Makeup %Fragrance 23

24 Victory of Skincare Lines Dedicated to China. Overwhelming brand awareness of Estée Lauder s Nutritious line. At first developed specifically for the Chinese market, the brand is now selling it in western markets as well. Searches for Nutritious collection or Red pomegranate, the Chinese name of the line Estee Lauder 22.7% 77.3% Lancome 10.4% 89.7% Searches for Génifique the most popular product line of Lancôme Digital Luxury Group, SA 24

25 Most Popular Beauty Products. Chinese consumers spontaneously rename products they love using cute nicknames, often linked to food #1 Skincare #1 Makeup Clinique Dramatically Different Moisturizing Gel, known as The bu`er ( ) in China Benefit dr. feelgood makeup primer, known as Piggy oil (, widely used in Chinese cooking) in China Digital Luxury Group, SA 25

26 Most Popular Fragrances. Compared with the highly local- specific skincare and makeup segments, preference for fragrances is much more in line with international trends Top 3 Fragrances in China #1 Dior J adore #2 Chanel No.5 #3 Chanel Chance Digital Luxury Group, SA 26

27 Fashion Digital Luxury Group, SA 27

28 Top 10 Fashion Brands in China. (/) #1 (-1) #6 (+1) #2 (-1) #7 (+1) #3 (+1) #8 (-2) #4 (+17) #9 (+2) #5 (+2) #10 Digital Luxury Group, SA 28

29 China s Love Affair with Bags. Bags and wallets dominate the Chinese fashion market generating almost 90% of total interest Digital Luxury Group, SA * All others include: belts, scarves, ties, gloves, cufflink 29

30 Top Handbag Models. Céline s iconic it bag - Luggage, tops handbag models in China, +2 places ahead of its global ranking. Rank vs. Global Brand Models 1 +2 Céline Luggage 2-1 Hermès Birkin 3 +4 Chanel Longchamp Le Pliage 5-1 Hermès Kelly For more information please visit: Digital Luxury Group, SA 30

31 Name Helps Product Stand Out. Local celebrity endorsement has played a major role in its popularity. Chinese nicknames for the Luggage has made it easy to remember. The model is widely renamed and in China. The first word refers to a facial expression a Chinese internet meme- that the bag resembles. The second word means- smiling bag - also linked to its appearance. The Chinese internet meme refers to a facial expression, thought to resemble the Céline Luggage handbag Digital Luxury Group, SA 31

32 Jewelry Digital Luxury Group, SA Photo Bulgari 32

33 Top 10 Jewelry Brands in China. (/) #1 (/) #6 (/) #2 (+5) #7 (/) #3 (+3) #8 (+1) #4 (-2) #9 (-1) #5 (-2) #10 Digital Luxury Group, SA 33

34 Big Players Dominate. Top 3 brands represent almost 90% of total interest Rings is the most popular product category representing half of the market #1 #2 #3 Digital Luxury Group, SA 34

35 Breakdown by Search Intention. Cartier, the higher- end brand amongst the top three, generates more searches for Price than other search intentions Breakdown of Search Intentions for Top 3 Jewelry Brands in China 0.9% 25.8% 1.1% 0.0% 6.3% 35.9% 8.7% 54.4% 73.3% 52.7% 36.8% Chow Tai Fook Cartier Swarovski Brand & Products Material Price Points of Sales All others Digital Luxury Group, SA 35

36 Top 3 Jewelry Collections. #1 #2 #3 Cartier Love Cartier Tank The Tiffany Setting Timeless signature design collections lead the way with Cartier and Tiffany s The Tiffany Se`ing is known in China by its nickname: Tiffany 6 paws ( ) Chow Tai Fook ranks #1 on a brand level but has no recognizable collection - An opportunity for the Chinese brand to grow in its home country? Digital Luxury Group, SA 36

37 China s LOVE Affair with Cartier. Cartier entered the mainland officially in 2001 LOVE collection launched in China in 2006 Cartier China s 1 st digital marketing campaign was for the LOVE collection with MSN China Luxury Channel: - Aim was to generate increased brand awareness among yrs old white collar workers - Created a microsite, resulting in +1 million page views during campaign period Cartier s Tank jewelry collection benefited from name recognition linked to extensive communication campaigns by the Maison in 2012 for the 75 th anniversary of the iconic Tank watch. The celebration was promoted heavily on social media, especially Sina Weibo, China s No.1 social platform, on which Cartier now has 460K+ fans Digital Luxury Group, SA 37

38 Watches Digital Luxury Group, SA Photo Omega 38

39 Top 10 Watch Brands in China. (/) #1 (/) #6 (+1) #2 (+1) #7 (-1) #3 (-1) #8 (/) #4 (/) #9 (/) #5 (+3) #10 Digital Luxury Group, SA Evolution VS. Jan - Dec 2011 (WorldWatchReport 2012) 39

40 Elegance Dominates Top 5 Watch Models. All top five watch models in China are very classic and elegant, far away from the world of sports and chronographs which are more popular with Western consumers Rank 2012 Evol. vs Brand Model vs. Global rank 1 +3 Omega De Ville Omega Constellation Cartier Ballon Bleu Chanel J Longines Master +34 Digital Luxury Group, SA 40

41 Love for Ceramic. Passion for ceramic is overwhelming in China (45.6% of total interest in materials) compared with any other country, such as: The United States (7.3%), Japan (16.7%), United Kingdom (8.5%) and Germany (12.9%) Breakdown of Watch Material Searches in China For more information please visit: Digital Luxury Group, SA 41

42 Unleashing China s Purchasing Power. The need to unleash purchasing power promises future growth for the Chinese luxury watch market. Personally I think it will maintain its rapid growth rate, though it might drop to a stable rate compared to previous years, just as China s GDP needs to slow down. This is a result of the growing maturity of consumers, selection range expansion, dispersed purchase channels and development of higher demands. Yingze (William) Bai Editor- in- Chief, Horlogerie Culture Center of China Digital Luxury Group, SA 42

43 Hospitality Digital Luxury Group, SA Photo: Twelve at Hengshan, A Luxury Collection Hotel Shanghai

44 Chinese Luxury Hospitality Focus. Top 10 Hotels #1 Sheraton #2 Hilton #3 InterContinental #4 Shangri- La #5 Westin #6 Four Seasons #7 Renaissance #8 Hya` Regency #9 Nikko #10 Ri - Carlton Vs. Global China Sofitel Langham Wyndham Fairmont Banyan Tree Le Méridien Mandarin Oriental Grand Hya` Kempinski St. Regis +3.3% +22.8% Top 10 Fastest Growing Hotels +29.2% +30.9% +34.9% +42.0% +45.3% +49.1% +49.3% +50.0% +56.4% China Global +76.2% +35.4% +20.5% +62.7% Top Local Destinations Shanghai Beijing Tianjin Shenzhen Hangzhou Top International Destinations Hong Kong Singapore Maldives Bangkok Guam +1.9% +3.3% Luxury Major Luxury Exclusive Upper Upscale Digital Luxury Group, SA

45 Chinese Luxury Hospitality Focus. Upscale and luxury have remained constant as a share of total hotels in China ( +8% on average progression ). The number of domestic travelers is forecasted to increase by over +25% from the current level to reach 3.3 billion by The World Tourism Organization projects that by 2020, 100 million Chinese tourists will make their way abroad annually. For more information on Luxury Hospitality, please view our reports: Digital Luxury Group, SA Source: Euromonitor International, Tourism Flows Outbound in China, March 2012.Mintel The rise of the BRICs-

46 Interested in More Information? Digital Luxury Group offers the opportunity to subscribe to a business intelligence service, which monitors the changing consumer interest of luxury prospective clientele. Through unique benchmarking metrics, luxury brands receive timely updates on the consumer demand for brands, competitors, product categories as well as various insights on key marketing drivers capturing the a`ention of luxury consumers worldwide. For more information, contact us: wlichina@digital- luxury.com Digital Luxury Group, SA

47 ABOUT. The World Luxury Index is an international ranking and analysis of the most searched- for brands and services within the luxury industry. Covering over 400 companies within six key segments (fashion, beauty, jewelry, cars, watches, and hospitality) in ten key luxury markets, the World Luxury Index provides insights on the unbiased search inputs coming from global luxury consumers in the world s top search engines (Google, Bing, Baidu, Yandex). The result is a one- of- a- kind benchmark of the luxury brands capturing the a`ention of luxury- minded consumers around the world. Digital Luxury Group has a history in luxury industry market intelligence. Since 2004, the WorldWatchReport has provided the luxury watch industry with unmatched insights and garnered a`ention from the world s leading publications, such as: Digital Luxury Group, SA 47

48 ABOUT. With offices in New York, Geneva, Shanghai, and Dubai, Digital Luxury Group (DLG) is the first international company dedicated exclusively to the design and implementation of digital communication strategies for luxury brands. Luxury Society is the world'ʹs most influential online community of top luxury executives. Based in Paris, with members in more than 150 countries, Luxury Society informs and connects CEOs, managers, journalists, consultants, designers and analysts from across the luxury industry. Digital Luxury Group, SA 48

49 CONTACT. GENEVA NEW YORK SHANGHAI DUBAI 7 Avenue Krieg 1208 Geneva 590 Madison Ave New York, NY /F One Corporate Avenue 222 Hubin Road, Luwan District Shanghai, Suite 1509, Shatha Tower, Dubai Media City PO Box Dubai T: E: geneva@digital- luxury.com T: E: newyork@digital- luxury.com T: E: shanghai@digital- luxury.com T: E: dubai@digital- luxury.com