As the yellow hue of leaves and onset of chilly nights in Beijing signal the arrival of winter, one must decide whether attending the China Fashion Week Spring Summer 2015 collections that start Saturday provides hope to get through the frigid months, or that viewing such summer images will simply frustrate.
This year China Fashion Week is squeezed in between the 4th Plenum and the APEC Leaders’ Meetings, both of which for the proletariat tend to mean traffic chaos in Beijing as roads are closed and alternate day driving restrictions put in place. APEC senior leaders will be treated to a new fleet of Hong Qi (Red Flag) domestically produced limousines which are now favored over foreign luxury cars and part of the Government’s campaign to promote domestic brands.
With these two major economic and policy meetings taking center stage in Beijing and with think tanks around the country being commissioned to submit ideas for China’s 13th five-year plan that will run from 2016 – 2020, international companies are realizing just how vital understanding Government policy is to managing their businesses in China.
It was in this context that I joined China Policy this week to give some presentations on how Government policy is likely to affect the business environment for the fashion and luxury sectors in the coming years.
A few key policy points coming out of the discussion this week are:
- We are now in a “new normal” and shouldn’t expect economic growth rates to return to the previous levels anywhere above 8%.
- The Government will continue to guide morality and exercise control on people’s behavior whether that be anti-corruption, censoring social media or having a chat to China’s artists and architects, as Xi JinPing did this week (no more crazy mall architecture it seems).
- The Government will promote and encourage domestic consumption as the economy (continues) to move away from export driven growth (great for E-commerce).
This weeks reading below, half of them relate to Alibaba, so thinking I should just rename this the Alibaba blog ? I’m still tinkering with the new site design too and still some inconsistent formatting issues to contend with.
Costco Opens in China, and No Membership Fees! – The Nanfang
Costco, that warehouse supermarket with extra-large boxes of food, is about to enter the lucrative, yet increasingly crowded Chinese e-commerce market with its Chinese partner, Alibaba. … All of the shopping will be done online through the popular website, TMALL….Costco guarantees home delivery within three days.
Alibaba is going to try and make this the biggest shopping day in the history of the world ever, and they may just succeed!
The total retail sales of consumer goods reached 2,304.2 billion yuan (US$376.4 billion) in China in September 2014, up by 11.6% year-on-year (nominal growth rate. The real growth rate was 10.8%).
Tesla Motors has decided to sell its Model S through Alibaba’s e-commerce platform Tmall on November 11, joining the Singles’ Day shopping festival. It is the first time that Tesla’s cars will be sold other than through their own website in China.
Lamborghini also did a campaign selling through T-Mall and Mercedes Benz also sold 205 Smart cars through Taobao in three hours (although then apparently had problems managing the insurance and license plate issues that physical dealerships usually manage for customers. Tesla is recruiting staff heavily in China, would be interesting to be part of their early team here.
Recently listed e-commerce giant Alibaba Group Holdings Ltd. has found itself in a public relations ordeal because its popular shopping website Tmall.com was caught exaggerating the number of orders for a smartphone.
Chinese e-commerce giant JD.com Inc said it had launched its warehouse and logistics initiative, ahead of China’s biggest online shopping event which produced sales of $1.6 billion (993.58 million pounds) for the firm last year.
Still a massive need for improvements in China’s logistics networks, this will bring big investment opportunities in warehousing and transport etc., but logistics heavily regulated by Government and high barriers to entry for foreign firms.
Alipay U.S. chief Jingming Li recently sat down with me to discuss new developments, its partner deals with Gilt and H&M, and navigating regulatory challenges in China. (video)
Alipay Wallet, the mobile app operated by Alibaba’s finance arm, announced today it has 190 million annual active users. The number of daily transactions through mobile has reached 45 million, with over 50% of the total from Alipay.
There is still conjecture about when and how Apple Pay will debut in China.
As we face a slowdown in the growth of global luxury sales in China, Hong Kong, and Europe, as well as a large change in terms of Chinese travellers’ profiles as they switch from group to independent travel, most brands are trying to reach a new type of more mature, more independent customer.
Chinese online shoppers favor U.S. e-retailers – Internet Retailer
They shop 13 times more often on U.S. e-commerce sites than the average for 10 major markets, Visa says. U.S. consumers are the most frequent overseas online shoppers at e-commerce sites in China.
According to a report released Monday by the China Tourism Academy, 129 million tourists visited the country in 2013, down 2.5% from the previous year. Meanwhile, the degree of satisfaction reported by tourists dropped by 11% in 2013 from the year prior, to “basically satisfied,” the report said.
As Tencent battles Alibaba in the e-commerce space and moves to open a bank, are we seeing the unstoppable ascent of this Asian tech giant?
Tencent is was ranked 14th most valuable global brand in 2014 by Milward Brown. I wonder how many people outside China have ever heard of them?
Intel’s venture-capital arm on Tuesday said it would invest $28 million in five Chinese startups that work on new technologies ranging from wearable devices to iris detection.
LIFE IN CHINA
To run or not to run? That was the question faced by entrants in Sunday’s Beijing marathon, as they awoke to find hazardous levels of pollution engulfing the city. The annual race, which has been dogged in recent years by difficulties – with the event twice postponed in 2012 due to scheduling clashes with the 18th Communist Party Congress, saw as many as 30,000 runners compete.
Beijing Silvermine Photography Project – The New Yorker
The project began, in 2009, when Sauvin, who has lived in China for more than a decade, discovered an accumulation of 35-mm. negatives in a recycling plant on the edge of Beijing. Buying the negatives in bulk by the kilogram, he has become a curator of what he calls vernacular Chinese photography. He estimates that he has sifted through more than half a million images, taken by ordinary citizens, between 1985 and the early aughts, that depict everyday life, leisure, and travel, both in China and abroad.