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Successful businesses
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EVOLUTION & UPCOMING TRENDS 	

OF FASHION E-COMMERCE IN CHINA	

MagentoCom event, November 2013	


VELVET GROUP, 2013 息
VELVET IS A DIGITAL CONSULTING AGENCY
SERVING FASHION, LUXURY AND BEAUTY BRANDS.
WE ARE BORN LUXURY, DIGITAL, CHINESE... AND GLOBAL

2
DIGITAL STRATEGY CONSULTING & EXECUTION

Social

Search

POS

Mobile

Brand
content

Official
site

DELIVER EXCEPTIONNAL CUSTOMER EXPERIENCE 
ACROSS BRAND  RETAIL TOUCHPOINTS 	

Brand awareness, personal connection,!
emotion and engagement !

eCRM

VELVET GROUP, 2013 息

e-Commerce

3
AVENE	


YVES SAINT LAURENT	


KERING GROUP	


GALERIES LAFAYETTE	


CLARINS	


BOUCHERON PARIS	


LOREAL GROUP	


CHRISTIAN LOUBOUTIN	


NOELI GALLERY
E-COMMERCE CONSULTING
Market Research  Business Opportunities
Deliverable

Industry

Product

Understand
Target
Audience

Business Proposition

Competition
Analysis

Research
Findings

Project Design  Planning
Deliverable

Consumer
Journey

Business
Scenarios

Business
Model

Project
Roadmap

Business
Requirements

Selection of service providers  solutions
Deliverable

IT

Warehouse

Payment

Operations

CRM

Delivery

Call center

Marketing

V E L V E T Group (HK) Ltd  Confidential 2013

Service
Providers
Selection

5
E-COMMERCE CONSULTING
TYPICAL PROJECTS

BUSINESS SCENARIOS TO START E-COMMERCE IN CHINA
DESIGN ENTIRE E-COMMERCE PROJECT
DEFINE THE PATH TO PROFITABILITY  PL ESTIMATIONS
OMNI-CHANNEL STRATEGY
AUDIT OF EXISTING E-COMMERCE PLATFORMS

V E L V E T Group (HK) Ltd  Confidential 2013

6
FULL E-COMMERCE SETUP - KEY PERFORMANCE DRIVERS

Display	
 
E-足mail	
 
marke9ng	
 

Front-足end	
 

Search	
 

u汲Merchandizing	
 

Omn
i-足cha
nnel
	
 

u汲Services	
 
u汲Loyalty	
 
program	
 

Social	
 Media	
 

Tra鍖

c	
 dri
vers

u汲MarkeEng	
 

u汲Inventory	
 
management	
 

PRODUCT
(fashion 
lifestyle)

	
 

u汲Logis9cs	
 
u汲Finance	
 

Back-足end	
 

u汲Call	
 center	
 
u汲IT	
 solu9ons	
 

Online	
 	
 
wholesale	
 
Partners	
 
JD,	
 Suning,	
 
Amazon	
 etc	
 
VELVET GROUP, 2013 息

Mobile	
 store	
 

Strategic	
 	
 
Online	
 
partners	
 
Tmall,	
 Bank	
 	
 
e-足malls	
 and	
 
鍖ashsale	
 sites	
 

	
 
Stores	
 
China	
 	
 France
CHINA BECAME IN 2013
THE WORLD BIGGEST
E-COMMERCE MARKET

V E L V E T Group (HK) Ltd  Confidential 2013
242 million

(2012)

China has the highest number of
Online consumers in the world

75 M

More than USA

2x

Double size
of Japan

6x

Sixth times
the size of UK

7.5 x

more than 7 times
the size of France
V E L V E T Group (HK) Ltd  Confidential 2013

9
And it will continue to grow steadily

2012 竪 2016

+50 M
Every year

X1.75

423.4

million

242

2012

V E L V E T Group (HK) Ltd  Confidential 2013

2016

10
Market size

2012 竪 2015	
 

169 billion

319

billion
EURO

B2C
= 45%

95.8 billion

X2
93.5 billion

159

billion

B2C
= 30%

45 billion

EURO

V E L V E T Group (HK) Ltd  Confidential 2013

11
CHINA HAS PLENTY OF ROOM FOR GROWTH

Internet users as a % of the total population

Korea

VELVET GROUP, 2013 息

US

Europe

China

Asia

India

12
FASHION IS THE N属1 CATEGORY

27%

18%
5%

Apparel,
footwear,
bags and
suitcases

VELVET GROUP, 2013 息

Consumer
Electronic,
Home
appliances

Cosmetics

4%

Mother 
Baby care

3%

Music,
Video 
books

13
APPAREL  ACCESSORIES SALES DURING 11/11

VELVET GROUP, 2013 息

14
DOUBLE 11 TOP 10 BEST SELLERS
Apparel takes up 5 positions among top 10 best sellers.

JACK JONES

Apparel

CAMEL (menswear)
UNIQLO
YINMAN

ARTKA

VELVET GROUP, 2013 息

Apparel

15
DOUBLE 11 TOP 10 WOMENS APPAREL

RMB 140,000,000
120,000,000
100,000,000
80,000,000
60,000,000
40,000,000
20,000,000

RMB 780,593,247
 EUR 100 million

0

VELVET GROUP, 2013 息

16
COMPETITIVE ENVIRONMENT
 CONDITIONS OF SUCCESS
TOP B2C WEBSITES BY MARKET SHARE

57%
Tmall
(Alibaba Group)

20%
JD

1%

Dang
dang

4%
QQ
Mall

4%

Suning

2%

Vancl

3%

Amazon

VELVET GROUP, 2013 息

18
LAUNCHED EARLY NOVEMBER

19
LAUNCHED 1 WEEK AGO

20
fashion shopping
UPCOMING TRENDS
OMNI-CHANNEL IS THE NEW NORMAL
則р Today's customer experience spans across multiple touchpoints
則р Challenge is to provide an integrated customer experience

WEBSITE

STORES

8%	
 Shoppable
of	
 total	
 retail	
 
or not
sales	
 is	
 online	
 

50%	
 of	
 retail	
 sales	
 
Digital
is	
 online	
 or	
 web-足	
 
in-stores
in鍖uenced	
 

Order online, collect 
return offline

MOBILE
(smartphones  tablets)

79%	
 oShoppable
f	
 US	
 smartphone	
 
owners	
 use	
 tnot phones	
 to	
 
or heir	
 
help	
 with	
 shopping	
 	
 

Source: Forrester Research, Web Influenced Retail Sales Forecast, 2013 - USA
VELVET GROUP, 2013 息
E-SHOPPING IS A MULTI-SCREEN AND MULTI-DEVICE EXPERIENCE

ATAWAD
CONSUMERS

VELVET GROUP, 2013 息

23
IT IS CRITICAL TO MAP THE CONSUMER JOURNEY

RESEARCH

WEB

SELECT

Comparison site

PURCHASE

Chat

Pick up at local
store

Visit retail store
Kiosk
Browse
catalog

Return instore

E2 = EXPERIENCE + E-COMMERCE

MOBILE
Google
search

Begin
catalog
order

Product
info
Email Order
confirm w/ Rec

EMAIL

VELVET GROUP, 2013 息

Issue complaint

Phone order

IN-STORE

SOCIAL

SERVICE

Buy online

CONTACT
CENTER

CATALOG

RECEIVE / USE

Facebook
Fan club

Read reviews

Share experience
on Twitter

Complain on
brands Twitter

24
1. MOBILE COMMERCE IS TAKING OFF IN CHINA
≒ Single day transactions from Taobao APP
exceeded RMB 5.35 billion
o 5.6 times over last years RMB 960 million
o Number of active users: 127 million
o Number of transactions: 35,900,000

≒ Alipay mobile exceeded RMB 11.3 billion
(10 times over 2012).
o 45 million transactions*

No. of Mobile
transactions

Percentage to
total No.
Transactions

Transaction
amount

2011

1,710,000

n/a

2012

9,000,000

8%

RMB
1,200,000,000

2013

45,180,000

24%

RMB
11.300,000,000

* 2013 Double 11 total number of transactions through Alipay: 188,000,000
VELVET GROUP, 2013 息

25
1. MOBILE COMMERCE IS TAKING OFF IN CHINA
則р

Key functions:
≒ product browsing/ product
review
≒ shopping cart
≒ order tracking
≒ order management
≒ user account
≒ coupon

Available on iPhone and Android

VELVET GROUP, 2013 息

26
2. WECHAT COMMERCE DEBUTS
SCAN-TO-PAY KILLS SHOPPING CART

Scan with WeChat
VELVET GROUP, 2013 息

27
2. WECHAT COMMERCE DEBUTS
SCAN-TO-PAY KILLS POS

≒
≒

Scan to place the item in Tmall shopping cart
Over 200,000 items have been placed in the shopping cart prior to double 11.

VELVET GROUP, 2013 息

28
3. EVOLUTION OF CUSTOMER SERVICE
CLICK-TO-CALL (BURBERRY)
1

Click-to-Call function on the header

2

Provide number to the customer service

3

Immediately connected with customer service

≒ Customers can indicate country, number
and the time to call
≒ The service is available 24/7

4

Receive a phone call from the US within the next 5 seconds. The customer representative is bilingual in English and Chinese and
answers customer inquiries with clear explanation

VELVET GROUP, 2013 息

29
3. EVOLUTION OF CUSTOMER SERVICE
SOCIAL MEDIA PLATFORMS FOR CUSTOMER SERVICE
Burberry customer care
Weibo account

Message board dedicated to
customer care
VELVET GROUP, 2013 息

30
4. PRODUCT PRESENTATION
VIDEO SHOPPING

VELVET GROUP, 2013 息

31
CONTACT US
Velvet Group Limited
Greenland Plaza - 1258, Yuyuan Road - 20050 Shanghai  China
www.velvetgroup.com | +86 21 61 16 72 32
Patrice NORDEY
CEO
pnordey@velvetgroup.com

VELVET GROUP, 2013 息

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Velvet_magentocom_china_event

  • 1. Successful businesses need creative strategies EVOLUTION & UPCOMING TRENDS OF FASHION E-COMMERCE IN CHINA MagentoCom event, November 2013 VELVET GROUP, 2013 息
  • 2. VELVET IS A DIGITAL CONSULTING AGENCY SERVING FASHION, LUXURY AND BEAUTY BRANDS. WE ARE BORN LUXURY, DIGITAL, CHINESE... AND GLOBAL 2
  • 3. DIGITAL STRATEGY CONSULTING & EXECUTION Social Search POS Mobile Brand content Official site DELIVER EXCEPTIONNAL CUSTOMER EXPERIENCE ACROSS BRAND RETAIL TOUCHPOINTS Brand awareness, personal connection,! emotion and engagement ! eCRM VELVET GROUP, 2013 息 e-Commerce 3
  • 4. AVENE YVES SAINT LAURENT KERING GROUP GALERIES LAFAYETTE CLARINS BOUCHERON PARIS LOREAL GROUP CHRISTIAN LOUBOUTIN NOELI GALLERY
  • 5. E-COMMERCE CONSULTING Market Research Business Opportunities Deliverable Industry Product Understand Target Audience Business Proposition Competition Analysis Research Findings Project Design Planning Deliverable Consumer Journey Business Scenarios Business Model Project Roadmap Business Requirements Selection of service providers solutions Deliverable IT Warehouse Payment Operations CRM Delivery Call center Marketing V E L V E T Group (HK) Ltd Confidential 2013 Service Providers Selection 5
  • 6. E-COMMERCE CONSULTING TYPICAL PROJECTS BUSINESS SCENARIOS TO START E-COMMERCE IN CHINA DESIGN ENTIRE E-COMMERCE PROJECT DEFINE THE PATH TO PROFITABILITY PL ESTIMATIONS OMNI-CHANNEL STRATEGY AUDIT OF EXISTING E-COMMERCE PLATFORMS V E L V E T Group (HK) Ltd Confidential 2013 6
  • 7. FULL E-COMMERCE SETUP - KEY PERFORMANCE DRIVERS Display E-足mail marke9ng Front-足end Search u汲Merchandizing Omn i-足cha nnel u汲Services u汲Loyalty program Social Media Tra鍖 c dri vers u汲MarkeEng u汲Inventory management PRODUCT (fashion lifestyle) u汲Logis9cs u汲Finance Back-足end u汲Call center u汲IT solu9ons Online wholesale Partners JD, Suning, Amazon etc VELVET GROUP, 2013 息 Mobile store Strategic Online partners Tmall, Bank e-足malls and 鍖ashsale sites Stores China France
  • 8. CHINA BECAME IN 2013 THE WORLD BIGGEST E-COMMERCE MARKET V E L V E T Group (HK) Ltd Confidential 2013
  • 9. 242 million (2012) China has the highest number of Online consumers in the world 75 M More than USA 2x Double size of Japan 6x Sixth times the size of UK 7.5 x more than 7 times the size of France V E L V E T Group (HK) Ltd Confidential 2013 9
  • 10. And it will continue to grow steadily 2012 竪 2016 +50 M Every year X1.75 423.4 million 242 2012 V E L V E T Group (HK) Ltd Confidential 2013 2016 10
  • 11. Market size 2012 竪 2015 169 billion 319 billion EURO B2C = 45% 95.8 billion X2 93.5 billion 159 billion B2C = 30% 45 billion EURO V E L V E T Group (HK) Ltd Confidential 2013 11
  • 12. CHINA HAS PLENTY OF ROOM FOR GROWTH Internet users as a % of the total population Korea VELVET GROUP, 2013 息 US Europe China Asia India 12
  • 13. FASHION IS THE N属1 CATEGORY 27% 18% 5% Apparel, footwear, bags and suitcases VELVET GROUP, 2013 息 Consumer Electronic, Home appliances Cosmetics 4% Mother Baby care 3% Music, Video books 13
  • 14. APPAREL ACCESSORIES SALES DURING 11/11 VELVET GROUP, 2013 息 14
  • 15. DOUBLE 11 TOP 10 BEST SELLERS Apparel takes up 5 positions among top 10 best sellers. JACK JONES Apparel CAMEL (menswear) UNIQLO YINMAN ARTKA VELVET GROUP, 2013 息 Apparel 15
  • 16. DOUBLE 11 TOP 10 WOMENS APPAREL RMB 140,000,000 120,000,000 100,000,000 80,000,000 60,000,000 40,000,000 20,000,000 RMB 780,593,247 EUR 100 million 0 VELVET GROUP, 2013 息 16
  • 18. TOP B2C WEBSITES BY MARKET SHARE 57% Tmall (Alibaba Group) 20% JD 1% Dang dang 4% QQ Mall 4% Suning 2% Vancl 3% Amazon VELVET GROUP, 2013 息 18
  • 20. LAUNCHED 1 WEEK AGO 20
  • 22. OMNI-CHANNEL IS THE NEW NORMAL 則р Today's customer experience spans across multiple touchpoints 則р Challenge is to provide an integrated customer experience WEBSITE STORES 8% Shoppable of total retail or not sales is online 50% of retail sales Digital is online or web-足 in-stores in鍖uenced Order online, collect return offline MOBILE (smartphones tablets) 79% oShoppable f US smartphone owners use tnot phones to or heir help with shopping Source: Forrester Research, Web Influenced Retail Sales Forecast, 2013 - USA VELVET GROUP, 2013 息
  • 23. E-SHOPPING IS A MULTI-SCREEN AND MULTI-DEVICE EXPERIENCE ATAWAD CONSUMERS VELVET GROUP, 2013 息 23
  • 24. IT IS CRITICAL TO MAP THE CONSUMER JOURNEY RESEARCH WEB SELECT Comparison site PURCHASE Chat Pick up at local store Visit retail store Kiosk Browse catalog Return instore E2 = EXPERIENCE + E-COMMERCE MOBILE Google search Begin catalog order Product info Email Order confirm w/ Rec EMAIL VELVET GROUP, 2013 息 Issue complaint Phone order IN-STORE SOCIAL SERVICE Buy online CONTACT CENTER CATALOG RECEIVE / USE Facebook Fan club Read reviews Share experience on Twitter Complain on brands Twitter 24
  • 25. 1. MOBILE COMMERCE IS TAKING OFF IN CHINA ≒ Single day transactions from Taobao APP exceeded RMB 5.35 billion o 5.6 times over last years RMB 960 million o Number of active users: 127 million o Number of transactions: 35,900,000 ≒ Alipay mobile exceeded RMB 11.3 billion (10 times over 2012). o 45 million transactions* No. of Mobile transactions Percentage to total No. Transactions Transaction amount 2011 1,710,000 n/a 2012 9,000,000 8% RMB 1,200,000,000 2013 45,180,000 24% RMB 11.300,000,000 * 2013 Double 11 total number of transactions through Alipay: 188,000,000 VELVET GROUP, 2013 息 25
  • 26. 1. MOBILE COMMERCE IS TAKING OFF IN CHINA 則р Key functions: ≒ product browsing/ product review ≒ shopping cart ≒ order tracking ≒ order management ≒ user account ≒ coupon Available on iPhone and Android VELVET GROUP, 2013 息 26
  • 27. 2. WECHAT COMMERCE DEBUTS SCAN-TO-PAY KILLS SHOPPING CART Scan with WeChat VELVET GROUP, 2013 息 27
  • 28. 2. WECHAT COMMERCE DEBUTS SCAN-TO-PAY KILLS POS ≒ ≒ Scan to place the item in Tmall shopping cart Over 200,000 items have been placed in the shopping cart prior to double 11. VELVET GROUP, 2013 息 28
  • 29. 3. EVOLUTION OF CUSTOMER SERVICE CLICK-TO-CALL (BURBERRY) 1 Click-to-Call function on the header 2 Provide number to the customer service 3 Immediately connected with customer service ≒ Customers can indicate country, number and the time to call ≒ The service is available 24/7 4 Receive a phone call from the US within the next 5 seconds. The customer representative is bilingual in English and Chinese and answers customer inquiries with clear explanation VELVET GROUP, 2013 息 29
  • 30. 3. EVOLUTION OF CUSTOMER SERVICE SOCIAL MEDIA PLATFORMS FOR CUSTOMER SERVICE Burberry customer care Weibo account Message board dedicated to customer care VELVET GROUP, 2013 息 30
  • 31. 4. PRODUCT PRESENTATION VIDEO SHOPPING VELVET GROUP, 2013 息 31
  • 32. CONTACT US Velvet Group Limited Greenland Plaza - 1258, Yuyuan Road - 20050 Shanghai China www.velvetgroup.com | +86 21 61 16 72 32 Patrice NORDEY CEO pnordey@velvetgroup.com VELVET GROUP, 2013 息