China Edge Conference Summary, july 2013

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China Edge Ltd. Plan. Engage. Deliver. China Market Services

for Luxury Retail & Hospitality

Conference Highlights Service and Hospitality for

High Net Worth Chinese 3 July, 2013, London

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• The China Opportunity • Know Your Customer • Attracting and Engaging Customers • Reaching Service Excellence

The China Edge Conference Service and Hospitality

for High Net Worth Chinese 3 July 2013,

At The May Fair Hotel, London Sponsored by ELLE Magazine

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Service and Hospitality for High Net Worth Chinese

Conference recap video on YouTube: http://youtu.be/rSsLISFcruM

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#chinaedge

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• China is a Must-Have, Not a Luxury

• China’s Global Consumers

• Engage & Serve

• Challenges

• 3-D Toolkit

Presentation Outline

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• 60% of luxury spend is offshore • Consumers driven by experience,

exclusivity, gifting – not just savings / duty-free

• Millionaires & middle classes drive growth • Trends incl. anti-corruption (short-term, targeted

impact); urbanisation (long-term, wide impact)

• Chinese travel is taking off • 83m trips, £67bn spend; 100m by 2015?

• Top 10% spend over £6,500 per trip

Global Consumers Im

age: J. Gordon

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• Be relevant & localise • But no dragons required!

• Multiple options for entry / engagement

• Be buzzy for branding • Social media is mainstream & essential

• Be online for consumer research • In Chinese, on Baidu (off Flash)

• Be welcoming • China-friendly service & payments

Engage & Serve Im

age: J. Gordon

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• Intellectual property • Register wide & early

• Monitor & enforce – protection is possible

• Culture & Crisis • Understand & adapt to sensitivities

• Don’t “hurt the feelings…” (like Zadig & Voltaire)

• Is China a cost or investment? • Tailor strategy to resource constraints

• What’s the cost of missing China?

Challenges

Image: Weibo; Business Insider

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• Strategy • Short & long-term

• Start at home & develop into China

• Marketing • Proactive, in-market multiplier &

consumer targeting • Leads to home & away sales

• Service • Culture, language, information

• Promotions, payments & privileges

China Edge Toolkit Im

age: J. Gordon

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Thank You!

Jeremy Gordon Director, China Edge

Email: [email protected]

Connect with me on LinkedIn: www.linkedin.com/in/jgordon

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#chinaedge

@chinacontact

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Hype or Goldmine?

$- $200.00 $400.00 $600.00 $800.00

$1,000.00 $1,200.00 $1,400.00 $1,600.00 $1,800.00

2005 2006 2007 2008 2009 2010 2011 2012

Per person

Per person

Source: VisitBritain

• Real opportunity or media hype? • Long term trend since 2005…

• Strong growth in visitor numbers and av. per person spend

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• Young • 73% of luxury consumers are under 45

• Average age of a millionaire is 37 (vs. 57 in U.S.)

• New • 1st-time buyers accounted for 67% of the luxury growth

• Majority from 2nd & 3rd tier cities

• Brand conscious • Brand is #1 driver of luxury experiences

• Key Segments • Modern Business Owners • International Professionals • Nouveau Riche • Second Generation Rich • Delegations and Officials • Traditional Business Elites

Who are the HNW Chinese?

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Hong Kong

Taiwan

Modern Business Owners

International Professionals

Nouveau Riche

Traditional Business Elites

Second Generation Rich

Government Officials

Where are Chinese HNWI from?

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What Motivates HNWI Chinese?

• Sense of self • Luxury consumption helps show that one has ‘arrived’ • Traditional culture of Face is central to this feeling

• Drivers • Extend Business / Asset Portfolio • Education for Self / Children • Relaxation or Adventure • Shopping for Self / Gifting • Health and Beauty

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• Respect & Understanding • Overcome instinctive distrust • Engage at a personal level • Learn to see beyond the clichés

• Key Issues • Information • Trust • Loyalty • Cultural Understanding • Food

Catering to HNWI Chinese

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Reaching HNW Chinese

• Have a multi-channel strategy and marketing plan • To push demand & ensure appropriate distribution

• Localise wisely with bespoke content • Not simply translation – And protect your brand well

• Have a clear focus of your target market • As China is too big and complex to cover it all

• Where? • In the UK

• Chinese Travel Trade

• Chinese Media

• Digital Marketing

• Social Media

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Thank You!

Roy Graff Director, China Edge


Connect with me on LinkedIn www.cn.linkedin.com/in/roygraff

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#chinaedge

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Millionaires Online

• 83% of Chinese millionaires use the internet daily • They frequently engage & curate content on social media

When they are not on social media sites they are on news portals

• 63% prefer Sina • 35% prefer Sohu

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Online Engagement

• China boasts the highest social and ecommerce engagement of any country

• The social media landscape is highly segmented with niche platforms for specific audiences

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Organic and Paid Social

• Weibo has many paid options

• Reach 100% of your fans with Weibo’s new promoted posts

• Great for competitions or events

• Weibo is not the Chinese Twitter

• It has a mix of functionalities from both platforms

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Organic and Paid Search

Google Baidu

• Browsing habits of Chinese audiences are fundamentally different

• Don’t need an overly simplified customer journey

• More willing to find the information they need

• Baidu BrandZone is a powerful tool

• But can be expensive

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Thank you!

Arnold Ma Director, China Edge

Email: [email protected] Connect with me on LinkedIn

uk.linkedin.com/pub/arnold-ma/26/44b/99

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#chinaedge

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Services to Foreign Visitors

• Language(s) • Online & in-store

• Transaction services • UnionPay, cash options

• Specific cultural norms and customs • Helps drive transactions �

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• Competition & Conflict

• Maintain inner harmony

• Non-assertive approach

Peaceful & Harmonious Culture

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Face

• Lian • Confidence of society

• Mian Zi • Prestige, reputation

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Reciprocity

• Receive – Repay • Exchange value • Mutual benefit • Sustain the ‘net’

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Relationships

• Guanxi • Harmony • Reciprocity • Face • Trust

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Thank you!

Yu Sun Director, China Edge


Connect with me on LinkedIn www.uk.linkedin.com/in/yuyumedia

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• Jeremy Gordon – Strategy & Risk • Roy Graff – Travel & Tourism • Arnold Ma – Digital & Social • Yu Sun - Training • Michaela Wolf – Luxury Marketing

The China Edge Directors

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Jeremy Gordon

• Over 20 years’ China experience in trade, investment and consulting

• Director of China Business Services, focused on strategy & risk

• Previously China Business Specialist at UK Trade & Investment (UKTI)

• China luxury experience includes: Publishing, jewellery, retail, private club

[email protected]

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• Over 18 years of hospitality, retail and tourism industry experience in China

• Led the development of independent travel business in China on behalf of Gullivers Travel Associates

• Fluent Mandarin Chinese speaker and student of Chinese philosophy, literature and poetry

• Managing Director of ChinaContact, working with luxury businesses on strategies and implementation of China market access

[email protected]

Roy Graff

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• Digital Marketing Director at Qumin, London’s first UK-China Digital Agency

• Digital Marketing experience on both client and agency side

• Hands-on China Digital experience includes: Luxury/Fashion, Education, Technology, Travel, etc.

Arnold Ma

[email protected]

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• Cross-cultural consultant with special focus on Anglo-Chinese communications in business

• Provides cross-cultural training, coaching and business strategies to international companies to improve business performance through effective communication

• Has worked with the Shanghai government and European Commission as a senior project manger, and as a trainer for Harrods

Yu Sun

[email protected]

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• Experienced luxury marketing executive & consultant

• Expertise in 360 Degree customer relationship management strategies to deliver direct ROI, using new technology and digital experiences

• Well connected in the luxury sector in the UK and internationally

Michaela Wolf

[email protected]

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China Edge Ltd. Plan. Engage. Deliver. China Market Services

for Luxury Retail & Hospitality

www.chinaedge.co.uk

twitter: @chinaedge

[email protected]