China: Economic powerhouse, innovation driver, one of fashion’s key players

For years I have been watching China’s economy sky-rocket. It has been incredible to see the speed at which this country’s economic power and influence has grown. China is competing with the U.S. to become the largest economy in the world in the near future. The nation’s heavy investment in innovation is definitely a key driving force behind this development.

The list of impressive developments is long, but there are a recent few that stood out the most to me. One of them is how Chinese companies are looking for ways to bring e-commerce to the most rural areas of the country. JD.com, a partner of ours, is at the forefront of this trend. The e-commerce pure player giant plans to build 185 drone airports in Southwest China to deliver online purchases. BUY+, introduced by Alibaba on Singles Day, is another example: this innovation leverages virtual reality to transport consumers virtually to New York City, allowing them to explore product offerings at Macy’s and purchase select items. The Alipay “Smile to Pay” facial recognition system that was piloted at a KFC restaurant in Hangzhou again highlights that there are no limits to digital innovation.

Among these pioneering developments, China’s economic growth has shifted in recent months and there are concerns of a slowdown. But the country’s luxury goods market is still seeing strong growth due to a number of factors that are allowing this specific industry to continue on its upwards journey. A recent Bain & Company report identified two key reasons behind this trend: the reduction of import duties on luxury goods and the implementation of stricter controls over gray markets. These regulations, combined with brands’ efforts to close the price gap with overseas markets, are leading more Chinese consumers to make luxury purchases at home.

At Tommy Hilfiger, we continue to focus on China since entering the market as one of the first premium designer brands in 2002. Not only has China become one of our highest growth potential markets, it is also the perfect place for us to test and trial our latest technological innovations among a digitally-savvy audience before rolling these out more globally. For example, in 2018 we successfully collaborated with Tmall, the world’s biggest e-commerce platform, to bring the full impact of our “See Now, Buy Now” platform to life. We partnered with them to hold a Super Brand Day takeover on the same day as our Fall 2018 TOMMYNOW show in Shanghai. At the experiential runway event, the on-site Tmall pop-up store featured augmented reality mirrors that allowed guests to try on the collection using a 3D avatar and then order their favorite styles to be delivered to their homes.

To reach, engage and excite digital native Chinese consumers on a daily basis, we also know that the best place to communicate with them is online. To break through this over-crowded space, working with top Chinese celebrities and key opinion leaders and leveraging their social platforms to increase credibility and awareness amongst their followers has proven successful. At Tommy Hilfiger, we realized the potential of this early on and have developed strong relationships with our ambassadors Hong Kong actor Shawn Yue and Chinese actress Maggie Jiang. Through these collaborations we are able to develop a more personal relationship between Chinese consumers and our brand, blending our classic American cool DNA with the incredible energy and determined optimism of regional ambassadors.

This determination and the inspiration that we all draw from working in this market is why I am excited to find out what the future holds for China and its fashion industry.