In China, Tmall’s luxury customers have gotten first access to Tiffany & Co.’s Paper Flowers collection, shopping the assortment in a virtual pop-up two weeks before it goes on sale in the brand’s brick-and-mortar stores on Sept. 1.
With the pop-up, Tiffany is flexing its tech muscles by offering an augmented reality experience, gamifying the shopping journey, that shows what the jewelry would look like on customers, by rewarding people who shop the collection with added perks, like an invite to a release party in Shanghai.
The move is a direct play for China’s high-spending millennial customer base, which make up more than half the customers in Alibaba’s Luxury Pavilion. Tiffany has been angling for millennial dollars through its marketing strategy: In May, with the launch of the Paper Flowers collection in the U.S., the brand recruited rapper ASAP Ferg to perform a more modern rendition of “Moon River,” while young actress Elle Fanning starred in the campaign. Most recently, the brand announced it would be renovating its New York store to better align the in-store experience with customer behavior. (More details on what the new store will entail haven’t been announced.)
But it’s China where Tiffany is seeing the most promising growth: In its most recent earnings report, revenue in the Asia-Pacific region was up by 28 percent, with that growth being accredited to China in particular. In North America, revenue was up by 9 percent, and Europe increased by 17 percent.
“Tiffany & Co. is embracing China’s digital innovation, as we continue to seek new platforms to deliver a seamless experience to customers in China and around the world,” said Philippe Galtié, Tiffany’s evp of global sales in a statement.
As domestic sales in China become increasingly crucial for fashion brands’ bottom lines, Alibaba’s Luxury Pavilion has become a frequent partner for the companies just entering the region’s e-commerce market. Launched in August of 2017 as a separate home for Alibaba-owned marketplace Tmall’s luxury shoppers, the Pavilion has since recruited brands like Burberry, Hugo Boss and Guerlain in addition to the arrival of Tiffany & Co., which didn’t previously sell on the platform prior to the virtual pop-up. In the past year, Alibaba has been working with brands to figure out what an elevated experience means for its top clientele: The only people who have access to the Pavilion are selected by Alibaba based on what they’ve bought previously and how much they spend on the platform in a year.
The access to those premium brands, richer product pages and marketing assets, and white-glove concierge service are elements of the Luxury Pavilion experience. More recently, brands have begun using exclusive collections to gain momentum. In June, Moschino released an exclusive capsule, and access to exclusive collections have become the top benefits. Moschino’s approach followed the limited-edition streetwear drop model, while Tiffany’s approach was all about access. Either way, customers shopping the Luxury Pavilion are looking for products they can’t get elsewhere.
“We work with these brands on a daily basis to help them figure out what works and what doesn’t. It’s a different customer, so you can’t just take what you’re doing in the U.S. or elsewhere and apply it here,” said Sebastien Badault, Alibaba’s managing director, in a recent interview. “But what does work is exclusives. So brands that partake are leveraging all the right ways to engage with the consumer.”