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The L2 Prestige 100®: China IQ measures 100 iconic prestige brands based on their digital competence in what will soon be the world’s largest luxury market—China. Authored by L2 in partnership with The George Washington University School of Business, the study ranks brands according to their performance across more than 300 data points and four dimensions: Site, Digital Marketing, Social Media, and Mobile. Each brand was assigned a Digital IQ and corresponding ranking of Genius, Gifted, Average, Challenged, or Feeble.
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China IQ© L2 2011 L2ThinkTank.com
SCOTT GALLOWAYNYU Stern
September 13, 2011
DOUG GUTHRIEThe George Washington University School of Business
The Social Graph: ChinaCLINIC
L2’s inaugural event in China will probe the underpinnings, platforms, and best practices of social media in China.
Year upon year of double-digit economic growth and urbanization has armed tens of millions of Chinese consumers with increasing disposable income and a voracious appetite for luxury goods. In 2009, China surpassed the United States as the world’s second-largest luxury market, trailing only Japan. However, while several prestige brands have been operating in China for almost 20 years, most are still trying to determine how to best tap this enormous but complex opportunity.
The social media landscape in China is dramatically different from other markets. Industry leaders like Facebook, Google, YouTube, and Twitter are non-factors in the market, requiring even the most digitally adept brands to fundamentally adapt their social media strategies to local platforms like Baidu, Youku, Sina Weibo, and RenRen.
The L2 China Clinic will provide a framework for thinking about the overall opportunity in China for prestige brands. Speakers will explore the key digital players and strategies that lead to success, as well as findings from the 2011 L2 Prestige 100®: China IQ.
HOSTED BY:
CORPORATE PARTNERS:
MEDIA PARTNERS:
Friday, October 14CEIBS, Shanghai
China Europe International Business School
Pre-event reception:
Thursday, October 13Four Seasons Shanghai
For an invitation & more information, contact:
工学坊GONGXF.COM
© L2 2011 L2ThinkTank.com 3
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Over the next 15 years, the global addressable market for luxury goods is expected to grow by 600 millionconsumers, provoking growth forecasts of 2.2 times GDP.1 Much
of this growth is projected to come from one market: China. In
2000, the Chinese market accounted for a fraction of luxury sales
globally, however torrid growth means in 2015, China will likely
overtake Japan as the world’s largest luxury market.
Forget What You Know
The algorithm for success in China is different:
• Less about a 50-something millionaire, more about a 30-some-
thing, upper middle class consumer
• Less about retail in Tier I cities, more about new modes of distri-
bution in Tier ll and lll cities
• Less about print, more about mobile and emerging platforms
• Less about “expert” editorial, more about peer reviews, as
60 percent of consumers indicate that the Internet is one of the
primary sources for information on luxury goods (up from 30
percent in 2008)2
Tomorrow Belongs to MeMcKinsey reports that 73 percent of Chinese luxury consumers are
under the age of 45, and upwards of 45 percent are under the age
of 35, suggesting that the majority of prestige purchasers are digitally
native.3 In the U.S., the average female prestige consumer registers
household income of $150,000 and spends $3,000 annually on
handbags. In contrast, the average female prestige consumer in
China makes $18,300 (125 RMB) and spends $2,000 annually on
handbags.4 Often these purchases occur after two to three months
of research and consideration, most of it done online.
The fastest growing luxury channel(s) in China: Paris and New YorkIncreasing wariness of counterfeit merchandise, coupled with
significantly lower prices abroad, has led to 56 percent of Chinese
luxury purchases occurring outside of China, suggesting that a
brand’s digital marketing investments on the mainland drive sales
in Shanghai and Beijing... and New York, Paris, and Hong Kong.5
Digital Is Different
Not a single global Internet leader is number one in China. The pro-
liferation of SNS platforms, BBS sites, and other digital channels
present a challenge to marketers. The environment favors brands
China: The greatest opportunity for prestige brands in a generation
1. McKinsey & Com-pany, “Understanding
China’s Love for Luxury”, March 2011.
2. Ibid.
3. Ibid.
4. Pao Principle, 2010.
5. Bain & Company, “China’s Luxury Market
Study 2010”, November 2010.
© L2 2011 L2ThinkTank.com 4
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0
200
400
600
2010 2015
800740
450TOTAL:
447TOTAL:
401 43
39 50
4497
94
257224
Inte
rnet
Use
rs (i
n M
illion
s)
that adopt nimble, platform-agnostic digital strategies that can be
adapted to multiple channels. A testament to the pace of change,
Chinese microblogging platform Sina Weibo was not analyzed in
our May 2010 study. Launched in August 2009, the platform has
added more than 10 million users per month and recently topped
200 million registered accounts. Sina Weibo has become the
platform of choice for prestige brands—57 percent of the brands
in the study now maintain an official presence.
China IQ = Growth
Our thesis is that success in the world’s fastest-growing prestige
market is inextricably linked to digital competence. This study
attempts to quantify the digital competence in China of 100 iconic
brands (The Prestige 100®). The majority, 91, compete globally,
while nine are of Chinese/Hong Kong origin. Our aim is to provide
a robust tool to diagnose digital strengths and weaknesses and
help managers achieve greater return on incremental investment.
Like the medium we are assessing, our methodology is dynamic,
and we hope you will reach out to us with comments that improve
our approach, investigation, and findings. You can reach us at
[email protected] and [email protected].
Sincerely,
SCOTT GALLOWAY
Founder, L2
Clinical Professor of Marketing, NYU Stern
DOUG GUTHRIE
Dean, The George Washington University School of Business
Internet Tidal WaveINTERNET USERS IN THE WORLD’S LARGEST LUXURY MARKETS
2010 vs. 2015
( in Millions)
= CHINA
= U.S.
= JAPAN
= U.K.
= FRANCE
Source: eMarketer, April 2011.
© L2 2011 L2ThinkTank.com 5
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0
300
600
900
1,200
1,500
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
Popu
latio
n (in
Milli
ons)
Addressable Market for Luxury BrandsPOPULATION WITH INCOME > $30,000 USD
(1995-2025 Estimates, in Millions)
= REST OF THE WORLD
= CHINA
= JAPAN
= EUROPE
= U.S.
Source: Goldman Sachs, March 2011.
+300 million(1995-2010)
+600 million(2010-2025)
© L2 2011 L2ThinkTank.com 6
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Methodology
SITE: Effectiveness of brand site.
FUNCTIONALITY & CONTENT: 70%
• Site Technology: Load Time, Hosting Location
• Site Navigation & Search
• Product & Promotions
• E-Commerce
SOCIAL MEDIA: Brand presence, community size, content, & engagement on major Chinese social media platforms.
MICROBLOGGING:
• Sina Weibo: Presence, Programs, Community Size, Interaction Rate
• Tencent Weibo: Presence, Programs, Community Size, Interaction Rate
DIGITAL MARKETING: Marketing efforts, off-site brand presence, and visibility on search engines.
• Search: China Site Traffic, Web Authority, SEO and SEM on Baidu and Google
• Advertising & Innovation: Recent Brand Initiatives, BBS, Taobao and Jiepang Activity
• Brand Buzz: Mentions and Video Uploads on Chinese Social Platforms
• Email: Frequency, Language, Content, Chinese Social Media Integration, Promotions
MOBILE: Compatibility and marketing on smartphones and other mobile devices.
• Mobile Site: Compatibility, Functionality, Transaction Capability
• iOS Applications (iPhone & iPad): Availability, Popularity, Functionality
• Android & Ovi Applications: Availability, Popularity, Functionality
40%
15%
30%
15%
China Digital IQ Classes
IQ Range IQ Class
140+ GENIUS
Digital competence is a point of differentiation. Site content is innovative and optimized for the Chinese consumer. Chinese social media efforts complement broader digital strategy. Brand experience seamlessly extends across mobile platforms.
110-139 GIFTED
Brands are experimenting and innovating across site, mobile, and social platforms. Digital presence is consistent with brand image and larger marketing efforts.
90-109 AVERAGE
Digital presence is functional yet predictable. Efforts are often siloed across platforms.
70-89 CHALLENGED
Limited or inconsistent adoption of mobile and social media platforms. Site lacks inspiration, does not translate to the Chinese consumer.
<70 FEEBLE
Investment does not match opportunity.
ONLINE VIDEO:
• Youku: Views, Number of Uploads, Subscriber Growth, Viral Videos
• Tudou: Views, Number of Uploads, Subscriber Growth, Viral Videos
BRAND TRANSLATION: 30% • Site Aesthetics
• Messaging & Imagery
• Chinese Relevance & Translation
SNS:
• Renren: Presence, Programs, Community Size, Interaction Rate
• Kaixin: Presence, Programs, Community Size, Interaction Rate
• Douban: Presence, Programs, Community Size
• Chinese Social Media Integration
• Customer Service
• Account Services
• Content Localization
© L2 2011 L2ThinkTank.com 7
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BrandRanking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
1 AUDI Automobiles 170 GeniusInnovation in technology: maintains presence on six different social media sites in addition to its own OurAudi.com
2 BURBERRY Fashion 157 GeniusLuxury’s digital darling doesn’t disappoint. From Jiepang VIP guest passes for Beijing grand opening to Christopher Bailey soundtrack on Youku, Burberry claims the fashion crown
3 BMW Automobiles 155 GeniusFrom “beasts to joy”—sheer social pleasure; great translation of a global campaigns for the Chinese market
4 VOLVO Automobiles 133 Gifted C70 Sina Weibo challenges consumers to design the plot for the next Volvo commercial
5 BENEFIT COSMETICS Beauty 127 GiftedLocal e-commerce launch caters to consumers with samples and gift-with-purchase offer; Sina Weibo and Kaixin “Benefit Beach Honey” contests delight
6 CADILLAC Automobiles 124 Gifted Recently released Route 66 short film starring Karen Mok across site and social media
6 ESTÉE LAUDER Beauty 124 Gifted EL-Lady BBS includes videos, games, Q&A, and link to purchase
8 LAND ROVER Automobiles 122 Gifted “The Evoque Effect” sets the standard for multichannel digital campaigns
8 MERCEDES-BENZ Automobiles 122 GiftedSLK Mask Party contest provides winners tickets to China Fashion Week and site visitors an opportunity to create their own virtual mask
10 PORSCHE Automobiles 112 GiftedInnovative comparison tool and stunning microsites for each model are the engine of their online presence
11 FERRARI Automobiles 111 Gifted Sina Weibo fans earn tickets and tees for Ferrari Racing Days in Shanghai
12 INFINITI Automobiles 110 GiftedOnline owners club provides access to forums, downloads and events; however could be updated more frequently
13 HERBORIST Beauty 108 Average Launched sampling program through popular fashion BBS communities Only Lady and Metroer
© L2 2011 L2ThinkTank.com 8
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
13 SWAROVSKI Watches & Jewelry 108 Average Dedicated channel on PPTV sparkles with live event feeds
15 CARTIER Watches & Jewelry 107 Average Love microsite is shareable across Kaixin, Douban, and Sina Weibo
15 GUCCI Fashion 107 Average Gucci Style iPhone app transcends language barrier
15 LANCÔME Beauty 107 Average Rose Beauty continues to score points, but Sina Weibo hasn’t been updated since October 2010
18 LOUIS VUITTON Fashion 104 Average Voyages microsite and Jiepang tie-in promote exhibit at National Museum of China
19 CHANEL Fashion 103 Average Chinese iPhone app provides access to Chanel News content and fashion videos
20 KIEHL’S Beauty 102 Average Dedicated Sina blog profiles local influencers
21 CHRISTIAN DIOR Fashion 101 Average Lady Blue Shanghai film disappoints with only 146 views on official Tudou page
22 CLINIQUE Beauty 100 Average More than 145,000 users participated in Renren “Knock Out the Old Me” campaign in early 2011
22 DOLCE & GABBANA Fashion 100 Average Live-streamed summer men’s fashion show exclusively through iOS and Android platforms
24 SK-II Beauty 98 AverageMore that 180,000 user wishes have been submitted through the “Start Early” microsite for a chance to win gifts and samples
25 OMEGA Watches & Jewelry 96 AverageResting on the laurels of China legacy; dedicated Youku page and well-configured watch finder aren’t enough to keep time
26 M•A•C Beauty 95 Average Dynamic product recommendation engine transcends borders
© L2 2011 L2ThinkTank.com 9
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
27 HENNESSY Champagne & Spirits 94 Average China-only Hxindian microsite hosts online contests, product videos and a members-only zone
28 JOHNNIE WALKER Champagne & Spirits 91 Average Yulu campaign features 12 mini films highlighting local personalities
28 LEXUS Automobiles 91 Average Generic site fails in pursuit of perfection
30 COACH Fashion 90 Average Mobile optimized site features the men’s collection
30DIANE VON FURSTENBERG
Fashion 90 Average Diane’s personal Sina Weibo account gets a boost from media mogul Hong Huang
30 LONGINES Watches & Jewelry 90 Average China-specific iPhone app cross-promoted on site
33 ACURA Automobiles 89 Challenged Creative promotions on Sina Weibo drive to the dealership
33 CHOW TAI FOOK Watches & Jewelry 89 Challenged Hong Kong jeweler showcases dedicated Taobao shop
33 JAGUAR Automobiles 89 ChallengedLive-streamed a press conference announcing its new models, but needs to push the accelerator on its digital efforts
36 GUERLAIN Beauty 88 Challenged1,570 participants on the Rouge Aomatique microsite indicates the brand is puckering up to the Chinese market
37 HUBLOT Watches & Jewelry 87 ChallengedTeaming with Formula 1 racer/blogger Han Han to create limited edition watch and accompanying Sina Weibo page
38 CLARINS Beauty 86 Challenged “Looking for V-Girl Contest” in search of perfect face shape received more than 7,000 entrants
39 YUE-SAI Beauty 83 ChallengedDedicated Youku page for eight episode miniseries directed by Gil Wadsworth received more than 1.5 million views
© L2 2011 L2ThinkTank.com 10
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
40 CHLOÉ Fashion 82 ChallengedChloé’s short-lived Chinese-language blog live-streamed runway shows and garnered more than 40,000 visitors
40 SHISEIDO Beauty 82 ChallengedAlmost 9,000 votes were cast in the search to find the best beauty expert on the brand’s 13,660 member BBS
42 MASERATI Automobiles 80 Challenged Strong configurator, but available only in English
42 ROLEX Watches & Jewelry 80 ChallengedMust spend time on more than a mobile-optimized China site and a Youku channel if it wants to raise its profile
42 SHANGHAI TANG Fashion 80 ChallengedE-commerce enabled iPhone app features city guides and taxi cards for Western visitors, but brand is lost on Baidu to Chinese consumers
45 JAEGER-LECOULTRE Watches & Jewelry 79 ChallengedTranslated microsite allows Chinese consumers to celebrate the 80th anniversary of the Reverso collection
45 RAYMOND WEIL Watches & Jewelry 79 Challenged Global video contest boasts dedicated pages on Douban and eYeka
45 TIFFANY & CO. Watches & Jewelry 79 ChallengedSingle post on Sina Weibo account suggests “What Makes Love True” site will be launched in September
48 BULGARI Watches & Jewelry 78 Challenged Exhibition at National Museum of China has no digital footprint
48IWC SCHAFFHAUSEN
Watches & Jewelry 78 Challenged Interactive IWC forum is mobile-optimized but available only in English
50 IDO Watches & Jewelry 77 ChallengedSina Weibo following more than 400,000 strong; decicated Sina Weibo account provides customer service
51 CALVIN KLEIN Fashion 76 Challenged CK One virtual box extends life of event
51 L’OCCITANE Beauty 76 Challenged One of three in Index with e-commerce enabled mobile app
© L2 2011 L2ThinkTank.com 11
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
53 AUDEMARS PIGUET Watches & Jewelry 75 Challenged Royal Oak Offshore collection microsite is buttressed by Chinese translation
54 RÉMY MARTIN Champagne & Spirits 74 Challenged “Real Man” video contest via Youku encourages user-generated video from macho entrants
55 PANDORA Watches & Jewelry 73 Challenged Limited Chinese site content leaves a lot still trapped in the box
56 LANEIGE Beauty 72 Challenged Café Laneige online community enhances interactivity
56 LUK FOOK Watches & Jewelry 72 ChallengedFaulty store locator is limited to Hong Kong site, but only brand to support Taobao plug-in on homepage
56 PIAGET Watches & Jewelry 72 Challenged Official Sina blog has registered only 5,000 visits
59 ARMANI Fashion 71 Challenged E-commerce pioneer with Emporio Armani launch, but fails to innovate elsewhere
59 BOTTEGA VENETA Fashion 71 Challenged Site is slow to load and lean on Chinese customization
59 FENDI Fashion 71 Challenged Placing in-video ads through Youku, but not placing enough attention on its overall strategy
62 LAMBORGHINI Automobiles 70 Challenged Brand-approved Taobao shop showcases eight different models but has yet to post a sale
62 ROLLS-ROYCE Automobiles 70 Challenged It’s hard to “contact us” when info is only for North America
64 HUGO BOSS Fashion 66 Feeble Online footprint pales in comparison to monstrous brick-and-mortar presence
64 MONTBLANC Watches & Jewelry 66 Feeble Huge SNS buzz, but not much else
© L2 2011 L2ThinkTank.com 12
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
64 TAG HEUER Watches & Jewelry 66 Feeble Tick tock—patience runs out waiting for site to load
64 VERSACE Fashion 66 Feeble Versace Home is e-commerce enabled; Versace Fashion, not so much
68 ALFRED DUNHILL Fashion 65 Feeble Day 8 blog available in Chinese, but only shareable via Facebook and Twitter
68 BALENCIAGA Fashion 65 Feeble July site launch fails to incorporate Chinese language version
70 BOBBI BROWN Beauty 64 Feeble Users can tune into tips from experts on Sina Weibo, but site doesn’t support e-commerce
71 CHOPARD Watches & Jewelry 63 Feeble Chopard Diary boasts strong content; too bad it isn’t in Chinese
71 GIVENCHY Fashion 63 Feeble Sina Weibo alone is not going to move the needle
73 MIU MIU Fashion 62 Feeble Falling into fashion with global site redesign; noticeably absent from SNS
73 PORTS 1961 Fashion 62 Feeble First mover is one of few in Fashion to sell online
75 BALLANTINE’S Champagne & Spirits 61 Feeble Chinese golf fans can follow the action at the Ballantine’s Championship via online and mobile
75 WULIANGYE Champagne & Spirits 61 Feeble More than 9,000 members on site BBS
77 DE BEERS Watches & Jewelry 60 Feeble April site relaunch included simplified Chinese translation
77 FERRAGAMO Fashion 60 Feeble Not much other than a Sina Weibo account with 30,000 fans and not a single post
© L2 2011 L2ThinkTank.com 13
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
77 HERMÉS Fashion 60 Feeble Offline innovation doesn’t translate online
80 MOUTAI (MAOTAI) Champagne & Spirits 58 Feeble Eagerly awaiting impending BBS launch and reactivation of online e-commerce
80 PRADA Fashion 58 Feeble Luxury’s digital laggard; Sino efforts aren't any different
82 VALENTINO Fashion 56 Feeble Global e-commerce site ships to China, but consumers must be comfortable shopping in English
83 ASTON MARTIN Automobiles 55 Feeble One of two brands with mobile app for Nokia’s Ovi platform
83 CHIVAS REGAL Champagne & Spirits 55 Feeble Supporting site info for “Craft of Chivalry” concert tour is first step
83 ERMENEGILDO ZEGNA Fashion 55 FeebleMen’s runway at fashion week featured projections of Chinese landscapes; but with limited visibility on Baidu, did content even reach Chinese consumers?
86 MARC JACOBS Fashion 54 Feeble Should read Louis Vuitton’s manual on courting China
87 MOVADO Watches & Jewelry 52 FeebleCompany website has good localized Chinese content but limited interactivity beyond flash navigation
87 RALPH LAUREN Fashion 52 Feeble U.S. digital fluency has yet to translate
87 VAN CLEEF & ARPELS Watches & Jewelry 52 Feeble Lacks SNS presence and Chinese-specific content on its translated site
90 PATEK PHILIPPE Watches & Jewelry 51 Feeble Strong brand equity; weak digital presence
91 HARRY WINSTON Watches & Jewelry 50 Feeble Rich site heritage content is tempered by poor load times
© L2 2011 L2ThinkTank.com 14
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Brand Ranking Watches
& JewelryAutomobiles Champagne
& SpiritsFashionBeauty
Rank Brand Category China IQ Class Description
91 MOËT & CHANDON Champagne & Spirits 50 Feeble Recent “Mr. & Miss Moët” Sina Weibo contest suggests IQ is about to pop
93 VACHERON CONSTANTIN Watches & Jewelry 49 Feeble English-only watch configurator and absent concierge need resetting
94 BELVEDERE VODKA Champagne & Spirits 46 Feeble Facebook focus doesn’t help in the East
95 MACALLAN Champagne & Spirits 44 Feeble Interactive elements not translated—blogs, artistry, and photo contest in English only
96 YVES SAINT LAURENT Fashion 43 Feeble Despite the iconic brand’s worst efforts, it still manages to gain some buzz on Chinese social media
97 DAVID YURMAN Watches & Jewelry 42 Feeble Compared to the global site, the Chinese site has no luster
98 BACCARAT Watches & Jewelry 41 Feeble Struggling to shine online
99 DOM PÉRIGNON Champagne & Spirits 26 Feeble China is in love with the brand; its digital presence not so much
100 VEUVE CLICQUOT Champagne & Spirits 24 Feeble Flat
© L2 2011 L2ThinkTank.com 15
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K E Y F I N D I N G S
In the Company of Genius
Two of 2010’s five Genius brands, Audi and
BMW, retained their status, the other three,
Lancôme, Estée Lauder, and Clinique,
remained solidly in the top quartile, buttress-
ing the notion that constant innovation and
investment are requisites for digital success in
this dynamic market. New to the Genius and
Gifted ranks, Burberry and Benefit Cosmet-
ics, were among 2011’s biggest winners, both
launching e-commerce in the past 12 months
and making significant investments in Chinese
social platforms.
More than two-thirds of the Prestige 100®
posted a Challenged or Feeble IQ, suggesting
digital efforts in China remain nascent across
the industry. The biggest differentiator between
Genius and Gifted brands occurred across
the Site dimension. Brands that score well
have developed transaction-oriented sites with
superior customer service, Chinese-specific
technology integration, tailored content, and
consistent translation.
Key Findings
China IQ Distribution% OF BRANDS PER CHINA DIGITAL IQ CLASS:
CHINA IQ
<70
Herborist
Swarovski
Cartier
Gucci
Lancôme
Louis Vuitton
Chanel
Kiehl’s
Christian Dior
Clinique
Dolce & Gabbana
SK-II
Omega
M•A•C
Hennessy
Johnnie Walker
Lexus
Coach
Diane von Furstenberg
Longines
CHINA IQ
90-109
CHINA IQ
>140
Audi
Burberry
BMW
CHINA IQ
110-139
Volvo
Benefit Cosmetics
Cadillac
Estée Lauder
Land Rover
Mercedes-Benz
Porsche
Ferrari
Infiniti
GIFTED
CHINA IQ
70-89
Acura
Chow Tai Fook
Jaguar
Guerlain
Hublot
Clarins
Yue-Sai
Chloé
Shiseido
Maserati
Rolex
Shanghai Tang
Jaeger-LeCoultre
Raymond Weil
Tiffany & Co.
Bulgari
IWC Scaffhausen
IDo
Calvin Klein
L’Occitane
Audemars Piguet
Rémy Martin
Pandora
Laneige
Luk Fook
Piaget
Armani
Bottega Veneta
Fendi
Lamborghini
Rolls-Royce
Hugo Boss
Montblanc
TAG Heuer
Versace
Alfred Dunhill
Balenciaga
Bobbi Brown
Chopard
Givenchy
Miu Miu
Ports 1961
Ballantine’s
Wuliangye
De Beers
Ferragamo
Hermés
Moutai (Maotai)
Prada
Valentino
Aston Martin
Chivas Regal
Ermenegildo Zegna
Marc Jacobs
Movado
Ralph Lauren
Van Cleef & Arpels
Patek Philippe
Harry Winston
Moët & Chandon
Vacheron Constantin
Belvedere Vodka
Macallan
Yves Saint Laurent
David Yurman
Baccarat
Dom Pérignon
Veuve Clicquot
AVERAGE
CHALLENGED
FEEBLE
GENIUS
9%
3%
31%
20%
37%
© L2 2011 L2ThinkTank.com 16
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Top 20 Brands
Rank Brand IQ Class IQ Score
#1 Audi Genius 170
#2 Burberry Genius 157
#3 BMW Genius 155
#4 Volvo Gifted 133
#5 Benefit Cosmetics Gifted 127
#6 Cadillac Gifted 124
#6 Estée Lauder Gifted 124
#8 Land Rover Gifted 122
#8 Mercedes Benz Gifted 122
#10 Porsche Gifted 112
#11 Ferrari Gifted 111
#12 Infiniti Gifted 110
#13 Herborist Average 108
#13 Swarovski Average 108
#15 Cartier Average 107
#15 Gucci Average 107
#15 Lancôme Average 107
#18 Louis Vuitton Average 104
#19 Chanel Average 103
#20 Kiehl’s Average 102
Rank Brand IQ Class IQ Score
#1 Lancôme Genius 167
#2 BMW Genius 157
#2 Estée Lauder Genius 157
#4 Audi Genius 150
#5 Clinique Genius 146
#6 Mercedes Benz Gifted 138
#7 Clarins Gifted 137
#8 Acura Gifted 130
#9 Cadillac Gifted 124
#10 Wullangye Gifted 121
#11 Lexus Gifted 119
#12 Infiniti Gifted 118
#12 Land Rover Gifted 118
#14 Moutai (Maotai) Gifted 115
#15 Cartier Gifted 114
#16 Porsche Gifted 113
#17 Herborist Gifted 112
#18 Christian Dior Average 109
#19 Louis Vuitton Average 108
#19 Tiffany Average 108
#19 Luk Fook Average 108
TIE
TIE
China Digital IQ Scores
TIE
TIE
2010 2011
Watches& Jewelry
Automobiles
Champagne& Spirits
Fashion
Beauty
KEY
= BRANDS THAT RANKED IN THE SAME IQ CLASS IN 2010 & 2011
= BRANDS THAT RANKED IN THE TOP 20 IN BOTH 2010 & 2011 BUT CHANGED IQ CLASSES
TIE
TIE
TIE
© L2 2011 L2ThinkTank.com 17
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Key Findings
GENIUS BRANDS: Audi
Renren: Users compete for a chance to win professional racecar training at Shanghai’s Formula 1 race track.
Sina Weibo: A branded Sina event page, linking to the official Weibo account, features the interactive Audi Driving Experience game. The winner receives a PS3 or iPad 2. Fans on the brand Sina Weibo page grew 70 percent to almost 61,000, from July 1 to August 1.
The Audi Driving Experience hashtag #奥迪驾控汇# has generated 147,850 posts on Sina Weibo. Audi also maintains separate Weibo pages for many of its models.
© L2 2011 L2ThinkTank.com 18
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Key Findings
GENIUS BRANDS: Audi
Kaixin: 181,450 followers.
Youku: 275,590 video views.
Tencent Weibo: Presence on Tencent Weibo is in its infancy.
Mobile: Multiple Chinese-language mobile apps provide virtual tours of the Audi A8L and complement a mobile optimized brand site.
© L2 2011 L2ThinkTank.com 19
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Digital Innovation at Brick and Mortar Stores: Burberry’s Chinese stores are outfitted with the latest in digital technology, including full-length touch screens and iPads.
Key Findings
GENIUS BRANDS: Burberry
Site: Chinese-language, e-commerce enabled site mirrors the brand’s global experience, including Chinese subtitled versions of the Burberry Acoustic video series.
Mobile: E-commerce enabled Chinese-language mobile site translates.
© L2 2011 L2ThinkTank.com 20
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Key Findings
GENIUS BRANDS: Burberry
Live Stream: An all-digital, holographic fashion show was streamed on brand site, marking the grand opening of the flagship Beijing store.
Youku: Milan Fashion Show live stream on Youku garnered Burberry almost 1.2 million views on its channel.
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Key Findings
GENIUS BRANDS: Burberry
Kaixin: 61,920 followers.
Douban: 20,780 members enjoy Acoustic series videos, product photo galleries, and a music channel on Douban.fm.
Sina Weibo: 182,250 Sina Weibo fans are treated to product videos and pics, magazine covers, and celebrity sightings.
© L2 2011 L2ThinkTank.com 22
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GENIUS BRANDS: BMW
Key Findings
Mobile Site: Provides BMW model overviews and pricing, but fails to take advan-tage of mobile features.
iPhone App: Exclusive iPhone app for Chinese BMW owners, MyBMWClub includes click-to-call customer service, a dealer locator, and offline meet-ups and events.
Sina Weibo: 240,300 fans on Sina Weibo experience the Joy of BMW.
© L2 2011 L2ThinkTank.com 23
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Key Findings
GENIUS BRANDS: BMW Youku: There are 31,800 unofficial BMW videos on Youku, the most of any brand and testament to brand strength.
Kaixin: 622,640 followers.
Tencent Weibo: BMW has the largest brand following on Tencent Weibo, with more than 173,000 fans.
Jiepang: Fans checked in on Jiepang to the Bird’s Nest National Stadium in Beijing for a virtual badge and a chance to win tickets to the BMW 3 Series fashion concert.
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K E Y F I N D I N G S
Key Findings
Top Five Biggest Winners & Losers2010 VS. 2011 IQ PERCENTILE RANK
FEEBLE
FEEBLEGIFTED
GIFTED
Flash and media-heavy site has had few technology or functionality updates.
Van Cleef & Arpels
Hour Lounge BBS available in Chinese receives minimal updates.
Vacheron Constantin
Audemars PiguetFEEBLE CHALLENGED
Launch of Chinese site launches brand from Feeble to Challenged.
BurberryCHALLENGED GENIUS
One of first in Fashion to launch e-commerce. Has extended social media prowess to Chinese platforms.
Johnnie WalkerFEEBLE AVERAGE
Launched presence on Sina Weibo and Douban; Yulu campaign featuring Jia Zhangke documen- taries is shareable across social media.
AVERAGE
Dolce & GabbanaFEEBLE
Fighting on every front; has launched a presence on nine social media sites globally including three in China. Developed mobile app for Ovi platform.
GIFTED
BenefitFEEBLE
Top-notch e-commerce and program launches on Youku, Tudou, Kaixin, and Sina Weibo propel this LVMH brand to the top of the Beauty rankings.
With the exception of Douban page, few updates since 2010.
Chivas RegalFEEBLEAVERAGE
Moutai (Maotai)
E-commerce functionality alone isn’t enough to keep this iconic liquor brand in the Gifted ranks.
FEEBLE FEEBLE
Localized site and high participation BBS forum aren’t enough to hold their ground.
Wuliangye
FEEBLE
+67%-41%
+48%-43%
+44%-56%
+40%-67%
+37%-68%
CHALLENGED
© L2 2011 L2ThinkTank.com 25
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Key Findings Brand Site Sophistication
% OF SITES WITH THE FOLLOWING ATTRIBUTES:
(2010 vs. 2011)
K E Y F I N D I N G S
Selling Is KnowingThe biggest change in site investments year
on year are tied directly to sales. The number
of brands that were e-commerce enabled
doubled, and one-fifth now sell online. In
addition, 23 brands have added offline retail
locators. E-commerce continues to be directly
correlated with strong digital performance
across dimensions, and brands selling online
registered average IQs 16 points higher than
those without online sales, suggesting that as
an organization begins generating revenue
online, additional resources are allocated to
digital marketing.
The Beauty category leads the way with 11 of
the 15 brands in the study boasting e-commerce
capability. The Fashion category posted the
largest year on year change as the percentage
of brands selling went from just seven percent
to 24 percent. Some Fashion brands, such as
Valentino and Diane von Furstenberg, that do
not host a Chinese site sell and ship to China
via their global site.
(continued on next page)
0%
Feat
ure
Adop
tion
(%)
Locate RetailWithin China
Site Hostedin China
ChineseLanguage
33% 32%
E-CommerceEnabled
10%
20%
62%
85%
80%
88% = 2011
= 2010
© L2 2011 L2ThinkTank.com 26
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K E Y F I N D I N G S
Selling Is Knowing(continued from previous page)
Weak credit card penetration rates and online
fraud fears continue to present e-commerce
obstacles. E-commerce enabled brands tackle
the payment infrastructure in a variety of ways,
the most popular being accepting payments
from the customer’s bank online. More than
60 percent of brands provide payment option
through Alipay, a PayPal equivalent, popularized
by B2C e-commerce site Taobao. Nearly 60
percent of brands still accept cash on delivery.
Key Findings E-Commerce Payment Methods
% OF E-COMMERCE ENABLED SITES EMPLOYING THE FOLLOWING:
(August 2011)
0%
% o
f E-C
omm
erce
Ena
bled
Site
s
Credit CardAlipay Cash onDelivery
Online Banking
58%
32%
Other
21%
63%
79%
OTHER
© L2 2011 L2ThinkTank.com 27
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% of Sites WITH the following:% of Sites WITHOUT the following:
K E Y F I N D I N G S
Missed Opportunities
Fifty-six percent of Chinese luxury purchases
are made abroad, however, just over half of
Chinese language sites provide a U.S. and
European store locator, a missed opportunity
to provide information to Chinese tourists.
Although, specific international information is
limited on many sites, so is local customization,
and less than a third of sites publish prices in
Renminbi.
Common 2.0 tools including user reviews and
social media integration, that are ubiquitous on
U.S. sites, particularly in commerce-oriented
categories such as Auto and Beauty, are only
incorporated on eight sites. In most cases, when
incorporated, social sharing via Chinese SNS
and solicitation of user reviews is relegated to
simple interface BBS forums.
Key Findings
Site Features: % OF SITES WITH & WITHOUT THE FOLLOWING TOOLS
(August 2011)
42%
52%
68%
92%
92%
58%
48%
32%
8%
8%
European &U.S. StoreLocator
Wish List
PricesViewable in
RMB
UserReviews
ContentShareable onChinese SNS
100%
© L2 2011 L2ThinkTank.com 28
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0%
Baidu:Paid Search
Google:Chinese Brand
Name
Baidu:Brand Zone
Baidu:Chinese Brand
Name
22%18%
26% 25%
Google:Paid Search
13% 12%
67%71%
43%
31%29%
42%
30%
15%
K E Y F I N D I N G S
Google: A Distant Second
Google continues to lose share in the Chinese
search market since redirecting searches to
Hong Kong in early 2010. The market share of
local search engine Baidu stands at 76 percent
versus Google’s 19 percent.6 This is a dramatic
shift from 2009, when Baidu controlled 58 per-
cent of the market versus Google’s 36 percent.
Prestige brands continue to struggle with
visibility on the local leader. Only 31 percent
of brand sites come up first in organic search
results for the Chinese brand name, and 42
percent of sites are not returned in the top
three. Organic visibility has actually declined
on the platform since our May 2010 report,
as the Baidu algorithm increasingly prioritizes
organic returns of customers purchasing terms
on other Baidu platforms.
Brands are doing better on Google, however
optimizing for a search engine that has de-
creasing relevance is short-sighted.
Key Findings
Brand Name Search Results POSITION OF BRAND SITES IN ORGANIC SEARCH RESULTS
(August 2011)
Paid Search Tactics % OF BRANDS PARTICIPATING IN THE FOLLOWING
FOR BRANDED SEARCH TERMS
(August 2011)
= CHINESE
= ENGLISH
= 2010: 1ST POSITION
= 2011: 1ST POSITION
= 2010: OUTSIDE TOP 3
= 2011: OUTSIDE TOP 3
6. Analysys International,
“Seasonal Survey of China Internet Search Market in Q2, 2011”,
July 2011.
© L2 2011 L2ThinkTank.com 29
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K E Y F I N D I N G S
Key Findings
Pay to Play
Paid search accounts for 31 percent of total
online ad spend in China and search revenues
were up 67 percent year-over-year for 2010.7
A quarter of the brands are engaging in paid
search on Baidu. Many are using paid search
to bypass Baidu’s algorithm and ensure visibil-
ity of their Chinese site. Despite being a proven
source of traffic, less than a quarter of the
brands are purchasing Baidu brandzones.
Without a presence on Baidu, brands are
virtually invisible in China. Baidu’s algorithm
is different than Google’s and requires a
dedicated strategy. In many ways, Baidu is
simpler and more accessible than Google,
and can be a very powerful tool with mini-
mal investment.
1
3
5
2
4
6
Get Your License: A legal ICP license is crucial. Without a certificate, site may be omitted from search results.
Buy a Baidu Brandzone: Brandzones drive results. Brands report up to 30 percent of their traffic originating from a brandzone and have seen click through rates up to 75 percent.
Cut the Code: Baidu’s crawler is not very sophisticated and requires aggressive spoon-feeding. Streamlining code and adding alternative text improves visibility. As with Google, flash-heavy sites encumber the crawler.
Host Your Site in China: Baidu’s crawler is “impatient” and will skip sites experiencing even minor latency issues eliminating the chance to appear in organic search results.
Reap What You Sow: Baidu content is prioritized in the search results. Curating brand content on Baidu platforms Tieba (à la forums), Baike (à la Wikipedia), and Zhidao (à la Yahoo Questions) is “free” and can improve search results 10-20 percent if done right.
Backlinks Boost: Targeted efforts to acquire backlinks can significantly improve ROI and search visibility.
Six Simple Strategies for Successful SEO in China:
7. iResearch, “2010 Q4 China Search Engine
Market” January 2011.
© L2 2011 L2ThinkTank.com 30
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Empty Inbox
Email in China is often overlooked in favor of
SNS or BBS communication. However, more
than 65 percent of Chinese Internet users
regularly use email. The level of adoption
across the Prestige 100® indicates a missed
opportunity. Although 69 percent of brands
provide email opt-in, only 35 percent send
Chinese language emails and just 17 percent
send marketing emails after an initial welcome
email. Furthermore, 46 percent of Chinese
users access email through a mobile device,8
but not a single brand optimized emails for a
mobile phone.
As brands continue to push towards e-com-
merce, email marketing becomes imperative.
Global consumer research suggests that the
Chinese are more receptive when it comes to
email as a call to action. Seventy-five percent
of Chinese Internet users indicate willingness
to purchase after receiving an email, versus 51
percent in the U.S. and 43 percent in the U.K.9
Key Findings
% of Brands WITH the following:% of Brands WITHOUT the following:
Email Marketing: % OF BRANDS WITH & WITHOUT THE FOLLOWING:
(August 2011)
31%
57%
65%
83%
90%
100%
69%
43%
35%
17%
10%
0%
EmailOpt-in
WelcomeEmail
ChineseLanguage
MarketingEmail
Link toChinese
Social Media
Viewableon Mobile
100%
8. “2010 China Internet Market Annual Review
Report”, iResearch, April 18, 2011.
9. China Internet Network Information
Center (CNNIC) 2011, eDialogue 2010.
© L2 2011 L2ThinkTank.com 31
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Social Mania
Unlike other global markets, where network
effects lead to natural monopolies, the social
media ecosystem in China is fragmented.
Sixty-six percent of Prestige 100® brands have
presence on at least one platform, up from less
than five percent in April 2010. More than half
are present on two or more, typically combining
a microblogging platform (Sina Weibo or Ten-
cent Weibo) and a video site (Youku or Tudou).
Geniuses Audi and Burberry are fighting a war
across several fronts and are present on six
and five different social platforms, respectively.
Social media fragmentation coupled with the
fact that most efforts were launched in the past
12 months, leads to social media communities
that are much smaller than average Facebook
and Twitter equivalents. Brand communities
on Kaixin and Renren, Facebook substitutes
with some of the longest brand legacies,
are the largest, averaging slightly more than
133,000 and 101,000 members, respectively. In
contrast, the average brand page in the June
2011 L2 Prestige 100®: Facebook IQ registered
almost 600,000 likes.
Key Findings
0%
3-MonthTraffic Growth
Registered Users(in Millions)
KaixinYouku TencentWeibo
SinaWeibo
0%
14%
4%
13%
Douban
0%
9%
0%
22%
0%
57%
Tudou
0%
8%
Renren
-29%16% No Data490% 5% 12% 6%
116231 233200 50 191 124
1%
7%
Social Media Adoption% OF PRESTIGE BRANDS PRESENT ON CHINESE SOCIAL MEDIA PLATFORMS
(August 2011)
*June 2011
SinaWeibo
Renren KaixinTencentWeibo
25,986 50,501
133,275101,130
588,902*
Average # of FollowersCHINESE PLATFORMS VS. FACEBOOK
(August 2011)= 2011
= 2010
© L2 2011 L2ThinkTank.com 32
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Wild About Weibo
Traffic to Sina Weibo is up more than 490
percent in the past three months, and prestige
brands can’t get enough of the microblogging
platform. Local jeweler IDo leads all brands on
Weibo on the heels of its “Irresistibly Appeal-
ing” campaign in which users could spin a daily
prize wheel on the platform to win diamonds.
Auto brands claim five of the top 10 spots,
most integrating Sina Weibo efforts with a
wealth of cross-platform digital campaigns.
In July, prestige brand Weibo fan growth aver-
aged 41 percent among brands with accounts
on the platform, a testament to its growth.
Ports 1961 led all brands in growth on Sina
Weibo, tripling its base over the course of the
month by referencing popular celebrities in
its posts. Audi was able to grow its already
substantial base by 70 percent to more than
148,500 fans through its “Audi Driving Experi-
ence” promotion.
Key Findings
Top 10 Brands:Largest Sina Weibo Fan Base:
(August 2011)
IDoFollowers: 409,374
CadillacFollowers: 366,179
Mercedes-BenzFollowers: 293,882
BMWFollowers: 231,056
BurberryFollowers: 180,964
AudiFollowers: 148,567
Diane von FurstenbergFollowers: 153,693
VolvoFollowers: 117,103
BenefitFollowers: 110,803
Louis VuittonFollowers: 107,408
#1
#2
#3
#4
#5
#6
#7
#8
#9
#10
Top 10 Brands: Sina Weibo Follower Growth
(August 2011)
0% 100% 200% 300%
Ports 1961
Luk Fook
Ferrari
Shiseido
Herborist
Moët & Chandon
Calvin Klein
Audi
Rémy Martin
Dolce &Gabbana
#1
#2
#3
#4
#5
#6
#7
#8
#9
#10
314%
140%
136%
135%
128%
108%
77%
70%
70%
69%
Watches& Jewelry
Automobiles
Champagne& Spirits
Fashion
Beauty
KEY
© L2 2011 L2ThinkTank.com 33
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KeyFindings
Top 15 Brands: Organic BuzzRELATIVE AGGREGATED ORGANIC MENTIONS ON SINA WEIBO & QZONE
& NUMBER OF VIDEOS ON YOUKU & TUDOU
(August 2011)
VolvoMoutai (Maotai)
Hermès Dior Prada Burberry Shiseido
Tiffany Porsche Gucci
BMW LamborghiniFerrariChanelAudi#1 #5#4#3#2
#6 #10#9#8#7
#11 #15#14#13#12
Watches& Jewelry
Automobiles
Champagne& Spirits
Fashion
Beauty
KEY
© L2 2011 L2ThinkTank.com 34
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0%Mobile App
16%
60%
Mobile Site
2%
25%
TOTAL:51%
TOTAL:31%
TOTAL:25%
TOTAL:10%
19%
6%
14%
3%TOTAL:2%
39%
-30%
12%
1%
31%
116%
0%
iPhoneiOS
iPad Mobile Site Android Ovi
Market Share
YOY Change
Mobile Adoption Rates(2010 vs. 2011)
Mobile Adoption Rates Across Platforms % OF BRANDS ON THE FOLLOWING MOBILE PLATFORMS:
(August 2011)
Mobile Incompatible
Of the 485 million Internet users in China,
318 million access the web through their mobile
phone.10 Many Internet users have gone from
no Internet directly to mobile Internet. While
prestige brand programming on mobile plat-
forms has increased dramatically from 2010,
it has not kept pace with the opportunity.
Slightly more than half of brands have apps
available in the Chinese iTunes store, but two
thirds of these apps do not provide a Chinese
language option, and only three—Lancôme,
L’Occitane, and Shanghai Tang—are commerce
enabled. Furthermore, only two brands, Aston
Martin and Dolce & Gabbana, have created
apps for Nokia’s Ovi platform.
Key Findings
= 2011
= 2010
= AVAILABLE IN CHINESE
10. China Internet Network Information
Center (CNNIC), July 2011.
© L2 2011 L2ThinkTank.com 35
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Flash of Genius
LAND ROVER: The Evoque Effect
Land Rover’s 360 digital campaign, “The
Evoque Effect,” highlights an ability to expand
and customize the user experience across a
variety of digital and social platforms. At the
core of the campaign is a half-animated,
eight- episode, mini action movie series, City
of Aurora. Android, iPhone, and iPad apps
provide additional screens for viewing the
episodes.
On Sina Weibo users can view the mini movies and answer a series
of questions for a chance to win a Macbook Air or create a custom poster
“The Evoque Effect” microsite
Sina Weibo page used to drive traffic to custom Sina event pages
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On Renren users answer quizzes around
the movie’s plot and characters for a chance to win prizes. The page also
included links to other social media properties
and a behind-the-scenes photo gallery
Flash of Genius
On Douban users write their own script or use an online tool to paint the city for a chance to win prizes ranging from model cars to notebooks and pens
A virtual drive-in movie theater on Tudou allows
users to view the movies, leave comments, create their own version of the
movie using an online editing tool, and paint
their own comic cells with an online toolThe Evoque Effect continued
© L2 2011 L2ThinkTank.com 37
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Flash of Genius
Lambos on Taobao
Taobao controls 75 percent of all e-commerce
transactions in China, with 48,000 items
purchased every minute. Among the 800
million products sold on Taobao, is a $1 million
Lamborghini.11 The online Taobao store, built by
a Shanghai dealer and approved by the brand,
is the only Chinese showcase for Lamborghini.
The store highlights the brand history that
would otherwise be lost in translation on the
English language site. Detailed product pages
for eight different models feature stunning
images and performance specs in Chinese.
Customers can leverage Wangwang, Taobao’s
online chat functionality, to receive more
information about specific models and after-sales
customer service. The site is more buzz than
business, however. Although it attracted more
than 8,000 orders, none of them resulted in an
actual purchase.12 In addition to e-commerce
enabled sites, Chinese brands Chow Tai Fook,
Herborist, Luk Fook, and Wuliangye also
maintain Taobao stores. Lamborghini is the
only Western brand in the study with
a Taobao presence.
Lamborghini’s Taobao sales stunt succeeds in gaining buzz and raising the brand profile
11. “E-Commerce in China: Patriarchic Benevolence”, Tom
Doctoroff, Huffington Post, August 14, 2011.
12. “Selling Lambo-rghini’s on Taobao.com”, Red Luxury,
May 26, 2011.
© L2 2011 L2ThinkTank.com 38
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Flash of Genius
Counteracting Counterfeiting
Counterfeiting is a challenge for both brands
and consumers. Chinese spirit brand Wuliangye
has digitally armed its customers with the
means to authenticate its product. Through
its website, customers can enter the RFID
code from the box or the product code from
the bottle. Consumers can also text the RFID
code to a designated phone number to receive
authentication and to report manufacturers
and resellers of counterfeit products online.
In-store, Wuliangye provides RFID kiosks at
authorized retailers.
Wuliangye allows consumers to authenticate their product online
© L2 2011 L2ThinkTank.com 39
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Flash of Genius
Gucci Style
The recently updated Gucci Style app
available for iPhone and iPad, although only
partially translated into Chinese, and lacking
e-commerce capability and Chinese social
networking integration, has garnered more
than 700 ratings—the most of any brand in the
study—and is currently among the 60 most
popular lifestyle apps in the Chinese iTunes
store. Users can watch runway and travel videos,
add products to wish lists, share products via
email, and locate the closest store.
The Gucci Style app available in Chinese has the most ratings of any in the study
© L2 2011 L2ThinkTank.com 40
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Flash of Genius
Personal Appeal
Looking to extend their brands, Diane von
Furstenberg and Bobbi Brown have joined
forces with Tom Cruise, Ricky Martin, and
Radiohead in signing up for a Sina Weibo
account. With the endorsement of Hong
Huang, the editor of fashion magazine iLook,
Diane’s account has garnered almost 154,000
fans, more than 34 times the number of fans
of the official DVF brand Sina Weibo account.
Diane von Furstenberg’s weibos are in English
and directly lifted from her Twitter account.
Her account also reposts DVF brand weibos
in Chinese.
Similarly, most of Bobbi Brown’s weibos are
curated from her Twitter account and in English.
As she does on Twitter, Bobbi Brown accepts
questions from her Chinese fans in a monthly
series called “#Askbobbi.” Her answers are
translated and posted in Chinese. The Sina
Weibo accounts of the Chinese make-up artist
team are highlighted. She also reposts from
the brand account, which has only 29,000
fans compared with her 107,400 fans.
Diane Von Furstenberg’s personal Sina Weibo page
DVF’s Sina Weibo brand page
Bobbi Brown’s personal Sina
Weibo pageBobbi Brown’s Sina Weibo brand page
153,693
4,901
107,397
29,142
Followers on Sina Weibo as of August 2011
© L2 2011 L2ThinkTank.com 41
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Flash of Genius
IDo Does Sina Weibo
IDo launched a Sina Weibo effort estimated
to have cost the brand millions of Yuan. The
“Irresistibly Appealing” campaign generated
more than 80,000 posts and 100,000 new Sina
Weibo fans.13 During the study period, IDo’s
fanbase grew 28 percent to more than 409,000,
the largest community on Sina Weibo in the
study. Each day fans were able to spin a virtual
prize wheel on its Weibo page for a chance to
win a diamond ring or pendant. Fans were also
encouraged to post their dreams or submit via
mobile, for the chance to have it fulfilled.
Weibo was also used to drive online traffic
offline. Instructions were posted on Sina
Weibo for fans to obtain a free bracelet at an
IDo store. These bracelets contained a code
that was to be texted to a designated phone
number for a chance to win a diamond. Within
three days, more than 10,000 bracelets were
given away and the company had to order
100,000 more to meet demand.14
IDo’s “Irresistibly Appealing” interactive campaign on Sina Weibo
Fans show off their bracelets on Sina Weibo
13. “Weibo Marketing Is ‘Irresistibly
Appealing’ to Luxury Brands”, Central
People’s Broadcasting Station of China,
August 22, 2011.
14. Ibid.
© L2 2011 L2ThinkTank.com 42
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Flash of Genius
Badges Before Bags
Luxury brands have taken to Chinese
Foursquare clone Jiepang to raise
brand awareness and drive online/offline
engagement. Virtual badges on the phone
replace shopping bags as a digital symbol
of exclusivity and being in the know.
Guerlain and BMW have also experimented with event specific Jiepang promotions, but do not maintain a permanent presence on the platform.
Date Brand Badge Jiepang Followers Promotion
April 2011 888Sina Weibo fans that checked into one of three Beijing stores received a virtual badge and were entered into a drawing for the chance to win a VIP pass to the grand opening party for its Beijing Sparkle Roll Plaza store.
April 2011 126Users who checked in at any Chinese Swarovski boutique received a virtual badge. Swarovski provided location-based tips and activities to celebrate Spring.
June 2011 676Users who checked-in at the Louis Vuitton Art Cosmic Voyage exhibit at the National Museum of China and shared it via any of the Chinese social networks earned an LV virtual badge.
Burberry
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Flash of Genius
Joy Is BMW
The “Joy Is BMW” microsite features content on
the next generation of BMW hybrid technology
and a series of videos in which everyday people
describe the impact that BMW has had on their life.
The site’s contest, launched simultaneously on
Sina Weibo and Tencent Weibo, allows users
to share their own story in 1,000 words or less.
The author of the tale with the most votes per
platform will win a BMW bicycle, and the best
overall will get to appear in a BMW Joy video.
The most popular story to date on the microsite
has received almost 315,000 votes.
Users submit their stories or place their votes
through branded Sina and Tencent event
pages. An app analyzes the content of their
Weibo page to detect their joy level. If they
share their results with 3 friends they receive
a BMW virtual badge. BMW’s Tencent Weibo
following grew 736 percent to more than
135,000. The hashtag #BMW之悦的故事#
(#JoyOfBMWStories) generated 16,766 posts
and 3,671,131 mentions during the month
of July. The hashtag #BMW在创造什么#
(#WhatIsBMWCreating) generated 23,370 posts.
BMW’s Tencent Weibo page
“Joy Is BMW” microsite
Users share their stories to collect votes in order to win a BMW bicycle
“Joy Is BMW” Sina event page
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Flash of Genius
Estée Lauder’s interactive game on Renren
Estée Lauder’s Renren brand page
Estée Lauder’s Kaixin pageEstée Lauder’s
BBS, EL-Lady
ESTÉE LAUDER: Applauded on Social Media In July, Estée Lauder grew its Renren following
more than 50 percent (the most of any brand)
to more than 200,000. Its Renren page featured
an interactive game in which users were chal-
lenged to collect coins. Additional points could
be gained by sharing the game with friends.
The top scorers received a tube of the new
Idealist eye cream. More than 76,000 users
participated in the game, which linked to Estée
Lauder’s e-commerce site.
Estée Lauder’s BBS, EL-Lady, combines edito-
rial content, interactive games, videos, promo-
tions, product recommendations from featured
community members, and online shopping. All
BBS content is shareable to Kaixin, and select
content can be shared on other SNS platforms.
BBS members are encouraged to answer
each other’s makeup questions and give tips.
Interactive skin care surveys and online tests
provide customized product recommendations.
Estée Lauder has amassed more than 625,000
followers on Kaixin, a social platform whose
traffic is down 28 percent in the last three
months. The challenge for Estée Lauder will
be to migrate these fans to new platforms or
to its own branded BBS, EL-Lady. Thus far, the
brand’s Sina Weibo account has slightly more
than 45,500 fans.
© L2 2011 L2ThinkTank.com 45
Want to know more about your brand’s China IQ?CONTACT US
Flash of Genius
Made for China Despite the Chinese’ love of foreign brands,
a number of prestige brands have launched
sub-brands, product lines, or special editions
exclusively in China in effort to appeal to the local
consumer, increase brand awareness, and
build goodwill with the Chinese government.
With its China-only brand, Classivm, Hennessy
is leveraging digital to help it reach the young,
urban Chinese consumer through a dedicated
microsite and Sina Weibo account. The
membership-based microsite, infused with
street culture, promotes sponsored events, provides
drink recipes, and hosts a series of contests.
In the latest contest, users create a profile,
upload their picture, assume one of four hip
hop personas—rapper, breakdancer, beat
boxer or graffiti artist—to create a custom
video featuring their animated avatar or submit
a new idea with an accompanying photo. Site
members vote on the submissions with the top
five vote getters for each contest receiving a $250
watch. Voters are also eligible for a prize.
As of August 31, almost 900 people participated
in the video contest, and the top five contes-
tants had a combined 596,450 votes. Two
hundred-fifty people participated in the “New
Idea” contest, with the top five contestants
earning a total of 93,210 votes.
The microsite is sharable on Kaixin, Baidu Space, Renren, Qzone, and Sina Weibo
Site members create a profile and
animated avatars that others can vote on
Sina Weibo account promotes the contests and encourages voting
© L2 2011 L2ThinkTank.com 46
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Flash of Genius
Beijing Backdrop
Luxury brands have harnessed online video to
introduce themselves to the Chinese market
and announce to the world its importance.
Fall/Winter Collection Beijing Event Live Stream on PPTV
Beijing Hologram Fashion Show Live Stream
Lady Blue Shanghai
Fall 2011 Ad Campaign–Shanghai
Want to know more about your brand’s China IQ?CONTACT US
© L2 2011 L2ThinkTank.com 47
BiographiesSCOTT GALLOWAYClinical Professor of Marketing, NYU SternFounder, L2
Scott is the founder of L2, a think tank for digital innova-tion, and a Clinical Professor of Marketing at the NYU Stern School of Business where he teaches brand strategy and digital marketing. Scott is also the founder of Firebrand Partners, an operational activist firm that has invested more than $1 billion in U.S. consumer and media companies. In 1997, he founded Red Envelope, an Internet-based con-sumer gift retailer (2007 revenues: $100 million). In 1992, Scott founded Prophet, a brand strategy consultancy that employs more than 120 professionals in the United States, Europe, and Asia. Scott was elected to the World Economic Forum’s “Global Leaders of Tomorrow,” which recognizes 100 individuals under age 40 “whose accomplishments have had impact on a global level.”
Scott has served on the boards of directors of Eddie Bauer, The New York Times Company, Gateway Computer, eco-America, and UC Berkeley’s Haas School of Business. He received a B.A. from UCLA and an M.B.A from UC Berkeley.
DOUG GUTHRIEDean, GWSB
Doug has been an expert in Chinese economic reform for more than decade, a trusted adviser of both multinationals and local Chinese companies, and a student of China for some 25 years. He is the author of Dragon in a Three-Piece Suit: The Emergence of Capitalism in China and China and Globalization: The Social, Economic and Political Transfor-mation of Chinese Society, and is co-editor of Social Con-nections in China: Institutions, Culture, and the Changing Nature of Guanxi. He is currently writing China’s Radical Transformation: Economic Reform, Global Integration, and Political Change in the World’s Largest Nation, which is an
in-depth look at how China’s government-driven form of capitalism has successfully overcome traditional theories of development and helped China become the economic and political juggernaut it is today. In addition to these major works, Doug has published more than 60 articles on China and has been an invited speaker on a number of occasions.
Doug is currently the Dean of the George Washington School of Business and has taught at NYU Stern, Harvard Business School, INSEAD, and the Graduate Schools of Business at Stanford University, Columbia University, and Emory University. He received his B.A. in Chinese literature from the University of Chicago and a Ph.D. in organizational sociology from the UC Berkeley.
MAUREEN MULLENL2
Maureen leads L2’s Research and Advisory Practice where she helped developed the Digital IQ Index®. She has bench-marked digital marketing, e-commerce, and social media efforts of more than 300 brands across Pharma, Auto, Luxury, Specialty Retail, Beauty, and the Public Sector. Mau-reen also has led digital strategy consulting engagements for a variety of Fortune 1000 clients. Before joining L2, Mau-reen was with Triage Consulting Group and led managed care payment review and payment benchmarking projects for hospitals, including UCLA Medical Center, UCSF, and HCA. Maureen has a B.A. in Human Biology from Stanford University and an M.B.A. from NYU Stern.
R. DANIELLE BAILEYL2
Danielle began her career at The Home Depot, Inc., where she led a variety of internal consulting engagements focused on supply chain, merchandising, and in-store pro-cess improvement. She went on to manage the implemen-tation of award-winning mobile initiatives for several large
media clients, including The New York Times Company, NBC Universal, Disney/ABC, Maxim magazine, and Zagat. While at L2 she has benchmarked the digital competence of brands spanning the Specialty Retail, Public Sector, Pharma, Wine & Spirits, Travel, and Financial Services industries. Danielle has a B.S. in Systems Engineering from the University of Virginia and an M.B.A. from NYU Stern.
CHRISTINE PATTONCreative Director, L2
Christine is a brand and marketing consultant with more than 15 years of experience creating brand identities and marketing communications for aspirational and luxury brands. As creative director of L2, she leads the transla-tion of the L2 brand across all touchpoints, with a particular focus on the visual packaging of L2’s research. She began her career at Cosí, where she developed the brand and oversaw its evolution from concept through growth to 100 restaurants. Since then she has provided creative direction for a wide array of clients, including the launch of Kidville and CosmoGIRL! magazine. Christine received a B.A. in Economics and Journalism from the University of Connecti-cut and an M.B.A from NYU Stern.
JESSICA BRAGAL2
Jessica, a freelance art director, specializes in identity, iconography, event graphics, and invitations. She began her career in fashion, designing textiles and prints at Elie Tahari’s design studio in New York City. She then focused on the Elie Tahari brand aesthetic and consistency in design across its many developing disciplines. She went on to become the art director of a small, prestigious design firm in Chelsea, where she focused on event graphics, digital and print collateral, and brand aesthetics for companies both large and small. Jessica has a B.F.A. in Graphic Design and an A.A.S. in Illustration from Rochester Institute of Technology.
Want to know more about your brand’s China IQ?CONTACT US
© L2 2011 L2ThinkTank.com 48
BiographiesSAGE BRENNANChina Luxury Network
Sage is a longtime media and Internet analyst in China, most recently based in Shanghai. He has a broad range of marketing, consumer research, market entry, and financial analysis experience, as both an advisor and a manager of entrepreneurial companies in China. Sage is a founder and curator of the Shanghai chapter of MobileMonday and TEDxShanghai.
Most recently, Sage was research director of Hong Kong-based hedge fund Pacific Sun Investment Management and chief representative of the firm’s China operations, based in Shanghai. Before that, he was general manager of Shanghai-based Pacific Epoch, a boutique telecom and technology research firm later acquired by Pacific Crest Securities. He contributed the weekly “This Week in China” column to Dow Jones’ MarketWatch for two years, and re-mains a frequent commentator on China-related media and technology issues in print media and on programs such as CNBC’s Asia Squawk Box.
A native of Boston, Sage has both an undergraduate de-gree in International Studies and an M.B.A. from the Univer-sity of North Carolina at Chapel Hill and has been speaking and studying Mandarin since he first lived in Beijing in 1987.
RICHARD HSUBrand Translation Expert H+ Branding
Born in Shanghai, Richard studied architecture in the U.S., developing a career in retail, advertising, branding, and design across the U.S., Europe, Japan, and Asia. In 2003, Richard returned to China to lead the opening of Wieden+Kennedy’s China office in Shanghai. In 2006, he opened the brand consultancy firm [h+] in Shanghai, which focuses on China and China-related brands, talents,
and education. Richard lectures regularly in the subjects of brand development and multi-disciplinary design at Colum-bia University, New York University, Tongji University, and the Central Academy of Fine Arts Beijing.
EMMA LIL2
Emma has served as a research analyst in China and has worked on a number of engagements advising foreign companies on their China expansion strategies and market prospects. For two years, she supported the online publica-tion Jing Daily, conducting research and assessing trends in the Chinese luxury and contemporary art markets. Born and raised in China, Emma speaks Mandarin and Canton-ese. She received her Bachelor of Commerce degree from the University of Windsor and has a M.A. in Cross-Cultural Communication from New York University.
XI CHENL2
Born and raised in Beijing and a resident of New York for more than two years, Xi serves as a bridge between Ameri-can and Chinese culture. Her experience running a store on Taobao provides her with a unique perspective on fashion and commerce in China. Xi previously worked in personal banking for RBC, providing customized and localized bank-ing services to Chinese clients. Xi has a B.B.A. from Capital University of Economics and Business in Beijing and an M.A.in International Education from New York University.
Additional thanks to Yvonne Du, Winnie Rui, and Flora Lan, who served as additional data collection resources and advised on methodology.
L2 is a think tank for digital innovation.
We are a membership organization that brings together thought leadership from academia and industry to drive digital marketing innovation.
RESEARCH
Digital IQ Index®: The definitive benchmark for online competence, Digital IQ Index® reports score
brands against peers on more than 350 quantitative and qualitative data points, diagnosing their
digital strengths and weaknesses.
Prestige 100®: These reports index and analyze the IQs of 100 iconic prestige brands in areas key to
future growth. Publications in 2011 will measure the performance of the Prestige 100® brand set in two
of the world’s largest “markets”, Facebook and China, as well as on Mobile platforms.
EVENTS
Forums: Big-picture thinking and game-changing innovations meet education and entertainment.
The largest gatherings of prestige executives in North America. 300+ attendees
Clinics: Executive education in a classroom setting with a balance of theory, tactics, and case
studies. 60 –120 attendees
Working Lunches: Members-only lunches led by digital thought leaders and academics.
Topic immersion in a relaxed environment that encourages open discussion. 12–24 attendees
MBA Mashups: Access and introduction to digital marketing talent from top MBA schools.
CONSULTING
Advisory Services: L2 works with brands to garner greater return on investment in digital initiatives.
Advisory work includes Digital Roadmaps, Social Media Strategy, and Site Optimization engagements.
MEMBERSHIP
For membership info and inquiries: [email protected]
UPCOMING 2011 EVENTS
10.14.11 L2 Clinic The Social Graph: China SHANGHAI
L2’s inaugural event in China will probe the underpinnings,
platforms, and best practices of social media in China. This
intensive executive session will enhance participants’ fluency in
brand-driven social media efforts on Chinese platforms.
11.10.11 L2 Forum Innovation 2011 NYC
Called the “TED for marketing,” L2’s third-annual Innovation
Forum will bring together the highest density of scholars,
business leaders, startups, and marketing executives in
North America.
11.21.11 L2 Clinic The Social Graph: Europe PARIS
Academics and industry professionals highlight the
opportunities, challenges, and underpinnings of social media
in the prestige industry in a one-day, intensive Clinic.
UPCOMING 2011 RESEARCH
PRESTIGE 100® Reports:
Mobile
DIGITAL IQ INDEX® Reports:
Beauty
Fashion & Leather Goods
Watches & Jewelry
A THINK TANK for DIGITAL INNOVATION
51 East 12th Street, 2nd Floor
New York, NY 10003
W: L2ThinkTank.com