To the heart of the market

Marketers across the luxury goods segment have long been drooling about the potential of a Chinese market with rapidly fattening wallets and an insatiable desire for anything with a high-end label.

The market has come a long way in sophistication and depth since the days when one Shanghai wine distributor was pleased to sell out a consignment of Château Lafite Rothschild, but a little surprised when the karaoke bar that bought the lot was serving it mixed with Sprite.

Richemont’s joint venture with Alibaba aims to get straight to the heart of the market, combining the retail offerings of Yoox Net-a-porter (YNAP) with Alibaba’s technology infrastructure and back-end support to bring YNAP’S 950 leading luxury brands to Chinese consumers. The plan is to replicate the offline shopping experience by smacking it all into Alibaba’s Tmall Luxury Pavilion, and if it can do this without the expense of all the bricks-and-mortar stores it will be a lucrative venture indeed.

Alibaba brings more than 600-million users to the party. It expects China to be pushing 50% of the global luxury market by 2025, which underlines the importance of this joint venture to Richemont’s brand portfolio.

Alibaba is an interesting choice of name for a brand, given that the original built his fortune by robbing a group of thieves who quartered his brother, so they were all killed off by stabbing or immersion in boiling oil, leaving Ali Baba in possession of their treasure store.

We can but hope that this latest incarnation has a less colourful approach to making money.

Let’s hope this latest incarnation of Ali Baba has a less colourful approach to making money