L2 released the Digital IQ Index: Luxury – China this week, which ranks and assesses 95 global and 5 local brands based on competence. Domestic brand Chow Tai Fook surpassed all and took the top spot, and its ascent to the top was indicative of a larger trend of local brands surpassing their foreign counterparts in China.
Chinese brands have been more open to direct e-commerce and adoption of third-party platforms such as Tmall. Chow Tai Fook and Chow Sang Sang are among the 13% of brands that offer direct-to-consumer e-commerce, and four of the five Chinese brands in the Index (Bao Bao Wan, Chow Sang Sang, Chow Tai Fook, and Lukfook) sell directly on Tmall. In short, all of the local brands in the study offer direct e-commerce or at least link to a third-party e-tailer (in the case of Qeelin).
Yet, Chow Tai Fook stands out with a user mobile and online experience. It is also the only jewelry brand to offer in-store pickup, and one of four brands to host its China site locally. (Sites hosted abroad can have load times up to three seconds.) It is also one of five sites to offer free shipping.
Being a domestic brand does give Chow Tai Fook an edge over foreign brands. For example, our report shows domestic Index brands are stronger on Sina Weibo. However, its embrace of e-commerce and convenience offering could be a guide to foreign luxury brands looking to pave their way in China.