The fashion industry in China is one of the most exciting possibilities for any foreign brands who want to expand their current reach. The industry is constantly evolving and growing, with Chinese consumers using clothing as an outlet of expression in an otherwise strict environment.
Such is the lucrative nature of the fashion industry; many foreign brands are trying to exploit this audience. However, promoting a fashion brand in China’s digital marketplace is a little more complicated than in the West.
This article will help you understand the Chinese fashion market in much greater detail and allow you to set up your brand and reach your full potential.
The Current Situation of the Fashion Market in China
It is no secret that China is one of the fastest growing and biggest economies. A major aspect of that is the fashion industry, a highly profitable industry in China that is constantly changing at an unprecedented rate.
Such is the speed of this growth that the fashion industry in China surpassed the US as the largest fashion market in 2019.
However, what is especially important is that the Chinese fashion industry is not just growing rapidly. It is also an extremely lucrative market for businesses keen to expand.
Experts predict that by 2025, Chinese consumers will make up 40% of all worldwide luxury spending, which is why so many brands are keen to target the Chinese population with their marketing campaigns.
Notable Market Trends
Even back in 2019, the urban population was dominated by generation X and millennial consumers, sitting at 60%. By 2025, experts predict this figure will increase to 65% by 2025.
This percentage increases even further when you look exclusively at the fashion industry in China. In total, iimedia predicts that these two generations dominate approximately 85% of the apparel industry.
With such a large percentage, brands need to tailor content and products to their needs to ensure they manage to tap into this large market.
In a communist system with plenty of rules to abide by, fashion offers people an opportunity to show off their personality through their clothes. This example is no more prominent than the generation Z audience, where there is a significant focus on wearing streetwear fashion.
Whereas in previous eras, generations opted for a smarter choice of fashion to highlight class status, generation Z focuses more on comfortability and expression in their clothing choices.
Another significant change over the last few years is the move toward genderless fashion. In today’s market, there is much more demand for t-shirts, sweaters, and casual pants across genders than for gender-specific garments.
Although the communist regime in China is widely regarded as one of the strictest, it has not stopped generation Z and millennials from embracing new fashion trends. They are more experimental with their fashion choices than previous generations, leading to brands focusing on different aspects that allow these consumers to express themselves through their clothing.
The final trend to consider is the consumer preference shift to online purchases. In previous eras, physical apparel stores dominated the shopping trends. However, it is now e-commerce platforms that experience the most action.
Modern life is quicker than ever, and online retail has never been easier. These two factors have led to a significant increase in consumers’ preference to shop online, a trend which only accelerated quicker due to the pandemic.
Challenges Foreign Companies Face in the Chinese Fashion Market
Establishing Brand Awareness
Establishing strong brand awareness can be a major challenge for some brands attempting to enter the Chinese fashion market. Many are unaware of the unique applications and tools that fashion consumers use in China, which differ greatly from those used in the West. Aspects such as SEO and paid social campaigns to work significantly differently in China, and if you do not grasp these intricacies, it will be hard to develop brand awareness. At Sekkei, our team is full of experts in the Chinese marketplace and knows all the techniques to increase a brand’s awareness.
Competition with Domestic Brands
When considering entering the fashion market in China, you must be aware of domestic brands that are direct competitors. In previous years, this competition was limited, as domestic brands targeted low-income consumers, and foreign brands focused on high-end fashion.
However, with the recent change to fashion choices such as streetwear in the influential generation Z, the lines are beginning to blur between domestic and international brands, as each targets this lucrative audience.
The Impact of Covid-19
This list would not be complete without referencing the impact of the covid-19 pandemic, which has led to signific consumerism changes. The covid-19 pandemic accelerated the transition from physical department stores to e-commerce alternatives.
Reduced footfall and rising rent and utility costs have meant that many physical stores are no longer sustainable, not to mention issues with the closing and restarting logistics operations and factories.
The Best Ways to Promote Your Fashion Products in China
Create an Online Flagship Store
When creating an online flagship store for your brand, you should use Tmall Global. Tmall is the largest B2C e-commerce platform in China and offers you access to the largest amount of Chinese consumers.
If you opt for Tmall, be aware that you need a physical warehouse based in China and a business license to operate in the marketplace. However, if you choose a Tmall Global online store, you do not need either, making it a much better option for businesses outside China.
A Tmall application can take more time than you might expect, so allow plenty of time for it to be accepted. Once you have paid your deposit and the account has gotten approval, you can design your store and set it up for business.
To succeed in China, you must create a brand widely respected and enjoyed by Chinese consumers. Social media plays a key role in increasing brand awareness, especially considering that most of this audience is made up of millennials and generation Z. For these consumers, a social media presence is essential.
Here are some of the most important social media channels for your brand.
WeChat is China’s most popular instant messaging application, similar to WhatsApp in the West. However, on top of operating as a messaging app, it now offers various services, such as customer support, consumer content, and purchasing options.
Louis Vuitton/ Prada/ HERMES WeChat Official Accounts
Weibo is China’s answer to Twitter, and almost all fashion brands use it to share content, drive sales, and engage with their customers.
Gucci Official Account & Celebrity Promotion
Finally, there is Little Red Book, a review platform similar to Trust Pilot. This tool allows users to offer feedback on their experience with your brand, which other potential customers use to decide if they want to purchase from your brand. Setting up a Little Red Book account shows potential customers your brand legitimacy and offers customers the chance to provide positive reviews that influence other customers in the future.
Dior /Armani Official Accounts on LRB
One key way that businesses thrive in the Chinese marketplace is through live-streaming. In many instances, companies operating in China tend to use live streaming as a specific marketing strategy. Live streaming is particularly popular in China because it allows real-time responses and purchases.
The best way to lead a successful live streaming campaign is to select the right platform. It should target your chosen audience and allow for instant messaging. Some of the leading platforms in China include LRB, TikTok, and Tmall Live.
The Fashion industry in China: Summary and Key Takeaways
As you can see, the Chinese fashion market is complex and constantly evolving. However, if you utilize the guidance from this article, you will surely give your brand the best chance of success in this highly lucrative industry.
If you feel you need expert support in achieving results, be sure to get in touch today. Our team of experts in the Chinese digital marketplace is sure to be able to help you achieve your goals.