US e-com­merce fash­ion startup com­pany is count­ing on China’s top so­cial me­dia in­flu­encers to tap into Chi­nese con­sumers’ on­line spend­ing prow­ess

China Daily (Canada) - - SHANGHAI - In Shang­hai xu­jun­qian@chi­nadaily.com.cn

For three days in June, the Grumpy Pig restau­rant in down­town Shang­hai was trans­formed into a fash­ion space akin to the Re­volve So­cial Club con­cept store on Mel­rose Av­enue in Los An­ge­les.

And just like the highly ex­clu­sive mem­bers-only space, this tem­po­rary Shang­hai show­case was only open to se­lect in­di­vid­u­als. The ma­jor­ity of those in at­ten­dance were China’s most pop­u­lar dig­i­tal in­flu­encers.

Re­volve may have a rather small fol­low­ing on Chi­nese so­cial me­dia plat­forms — it has just 146,322 fol­low­ers on Weibo — but China is cur­rently the brand’s sec­ond largest mar­ket af­ter the US with about 600,000 ac­tive users.

To Re­volve co- founders Michael Mente and Mike Karaniko­las, dig­i­tal in­flu­encers are the key to en­large the brand’s cult sta­tus in the coun­try.

“This event is our very first at­tempt to reach out to our Chi­nese cus­tomers. For us, the Chi­nese mar­ket is even more im­por­tant than the one in New York. We think the ex­pe­ri­ence here will drive more on­line sales,” said Mente, CEO of Re­volve.

“We see so­cial rev­enue, which means trans­ac­tions di­rected from so­cial me­dia, be­ing 10 times larger in China than the US. In the US, In­sta­gram is very pop­u­lar but it doesn’t ac­tu­ally drive sales. In China, how­ever, Weibo and WeChat di­rectly trans­late to sales as cus­tomers can im­me­di­ately buy Re­volve prod­ucts via th­ese apps.”

Founded in 2003, Re­volve is a Los An­ge­les-based on­line cloth­ing site that has been mak­ing waves in the US e-com­merce and fash­ion scenes. Last year, the brand sold $400 mil­lion worth of women’s ap­parel and it ex­pects to make some $600 mil­lion by the end of this year.

Mente noted that in the US mar­ket, pur­chases on mo­bile de­vices rep­re­sented just 25 per­cent of the to­tal sales in 2015. In con­trast, al­most 50 per­cent of the sales in China came from such a sales medium, up from 35 per­cent the year be­fore.

“The Chi­nese cus­tomers are re­ally con­vinc­ing us that we have to in­vest more in this mar­ket,” said Mente.

Re­volve had in 2014 al­ready started to fo­cus on its China mar­ket when it made its web­site avail­able in Chi­nese. Since the be­gin­ning of this year, the com­pany also started to of­fer free ship­ping to the coun­try for pur­chases over $100 (if the pur­chase is over $300, the de­liv­ery time is shorter). In March, Re­volve opened its first over­seas call cen­ter to cater to their Chi­nese cus­tomers.

With re­gard to their mar­ket­ing and brand­ing di­rec­tion, Mente said that Re­volve was all about ex­clu­siv­ity and cham­pi­oning in­di­vid­u­al­ism.

“Here at Re­volve, we want to of­fer a new kind of ex­clu­siv­ity, one that doesn’t nec­es­sar­ily equate to be­ing ex­pen­sive. Th­ese days, lux­ury brands are not ex­cit­ing any more — it’s ac­tu­ally eas­ier to find Gucci prod­ucts than a pair of emerg­ing-brand jeans on­line,” said Mente.

“The land­scape now is very dif­fer­ent from the one in the past. We first started the com­pany be­cause we iden­ti­fied a gap be­tween peo­ple’s de­sire to shop for clothes on­line and the lack of goods. Now, al­most any­thing can be bought on­line so for us it’s all about cu­rat­ing fash­ion per­spec­tives.”

This strat­egy looks to have hit the nail on the head, es­pe­cially in China.

While the Chi­nese have in the past decade splurged on lux­ury prod­ucts, con­tribut­ing to 47 per­cent of the global sales at its peak, there has been slug­gish growth in the in­dus­try since 2014. How­ever, mar­ket re­search has dis­cov­ered that the slow­down is not due to a tight­en­ing of bud­gets, but rather, a shift to brands and styles that are less “showy” and more in­di­vid­u­al­is­tic.

Up to 15 per­cent of Re­volve’s sales in China come from just eight of its nearly 600 brands avail­able on its web­site. Six of th­ese eight brands were launched in China in a span of just 12 months. Ac­cord­ing to Mente, sales in th­ese emerg­ing brands of the Chi­nese mar­ket soared by 70 per­cent in the first quar­ter of this year.

“Chi­nese cus­tomers are no longer just eye­ing big brands and seek­ing to look like one an­other. Rather, they want to ex­press their in­di­vid­ual styles via their clothes. In some ways, the US or Hol­ly­wood aes­thet­ics kind of lead the world, but it is the Chi­nese who are lead­ing the world in terms of mo­bile shop­ping,” said Mente.

While he is aware of the stiff com­pe­ti­tion Re­volve faces from Chi­nese e-com­merce plat­forms, Mente be­lieves that his com­pany has a huge ad­van­tage be­cause it is lo­cated in Los An­ge­les, a place that is close to the glitz and glamor of Hol­ly­wood.

“Lit­er­ally, all the stars are in our neigh­bor­hood, our back­yard,” said Mente be­fore adding that Amer­i­can fash­ion model Gigi Ha­did had re­cently worn a pair of jeans that is sold on his web­site.

“It’s re­ally amaz­ing that Chi­nese con­sumers are so savvy. They know of Gigi Ha­did wear­ing the new jeans at al­most the same time as their friends in the US. And the beauty of e-com­merce is that one can have that same pair of jeans at al­most the same time too,” said Mente.


No pigs, just clothes. The Grumpy Pig restau­rant in Shang­hai was turned into a fash­ion show­room for Re­volve's first China event.

Re­volve of­fers cloth­ing from about 600 brands on its e-com­merce site and the com­pany has about 600,000 ac­tive users in China.

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