Tmall Luxury Pavilion, the luxury goods platform launched by Alibaba in 2017, is experiencing an explosive growth. There is no doubt that one fast-growing target market is no stranger to that.
Gen Z
Last year, the ‘luxury pavilion’ significantly expanded its offering by partnering with Net-a-Porter and Farfetch. It did the platform no harm, as in the first quarter of 2021, the business grew by 159 %.
Business Development Manager Nicolas Cano points to the increasing importance of China’s Generation Z for the company. “80 % of our customers are under 35”, Cano told Fashion Network. “The number of Gen Z customers is doubling every year. We know that, by 2035, they will be the biggest consumers of luxury goods, with 40 % of the global market – up from 4 % today.” China already has about eighty million people within that age group.
Affordable luxury
Tmall Luxury Pavilion offers Western brands the opportunity to present themselves online to millions of Chinese shoppers. Brands are selected based on their presence at the four major fashion weeks or on international appeal and resonance. The range has been gradually expanded to include beauty products, leather goods, ready-to-wear and, most recently, high-end watches.
In doing so, the platform has to take into account the growing demand for ‘accessible luxury’, driven by the Chinese middle class of 400 million people. “These consumers are price-sensitive but still want to buy more branded goods”, says Cano. “We see that brands that are catching on are communicating values that resonate locally.” This is the case for Maison Kitsuné and Isabel Marant, for example.
Chinese brands?
Last year, the luxury side of the offering was strengthened by the arrival of Prada and Balenciaga, among others. The high-end segment will soon be expanded with the arrival of Cartier, Van Cleef & Arpels, Chopard and Boucheron. “We see that all sub-segments are developing rapidly, also lifestyle with brands like Tesla, Rimowa and Devialet.”
The question that remains is: where are the Chinese brands? “Today, we have very few of them in the pavilion, but we notice momentum with brands such as Icicle, that getting a lot of exposure. I think we will see more and more of them in mainland China and beyond.”
