Neiman Marcus Chases China Boom With Ecommerce Launch
Luxury retailer Neiman Marcus announced plans to launch an ecommerce website in China by year-end to cash in on the country’s strong interest in high-end brands and growing spending power.
In its first foray into the Chinese luxury retail market, Neiman will invest $28 million in Glamour Sales Holding, which operates flash-sales websites in Asia. The cash infusion will help build Neiman’s new ecommerce site and grow Glamour’s existing flash sales business.
"We are taking this bold step to establish Neiman Marcus Group as an international brand," said Karen Katz, the company’s president and CEO, in a statement. "Our strategic investment in Glamour Sales gives us a tremendous partner and a strong foothold in a rapidly expanding luxury market.”
Possessing spending power boosted by rising wages and more widely available consumer credit, the Chinese consumerhas increasingly attracted the eye of retailers.
The new site will showcase full-price, current-season items in addition to editorial content, fashion expertise and behind-the-scenes videos to provide insights about featured luxury brands.
The company has not decided whether the site will be branded under the Neiman Marcus or the Bergdorf Goodman name.
Neiman’s statement follows an announcement by J.Crew on Wednesday that it would expand its global ecommerce to 107 countries throughout Asia, Australia, Europe, the Middle East and South America. Over the next several years, the company plans to expand to specialty stores in select markets in Asia and Europe also.
Using an ecommerce website to enter a new country is often a good strategy, according to industry consultants, as it provides an inexpensive way for retailers to test the market.
Olivier Chouvet, Glamour Sales' chief executive officer, alluded to the country’s widespread counterfeiting problem as one possible selling point for the new site.
In a statement, he said the website will provide “customers with the peace of mind that comes from knowing that all of our luxury goods are authorized, authentic and sourced directly from the manufacturer.”
Counterfeiting continues to be an issue for top luxury brands. In early March, the U.S. Department of Justice intercepted an elaborate global counterfeitingand smuggling scheme to produce knock-off goods in China and sell them in the U.S.
The seizure included knock-offs of Ugg boots, Nike shoes, Burberry scarves, Timberland boots and items from Gucci, Lacoste, Coach , Ralph Lauren and Louis Vuitton. Counterfeiting has also drawn the attention of the Council of Fashion Designers of America and eBay , which announced during New York Fashion Weekthat it would launch a line of tote bagsto educate the public about counterfeiting.