Introduction
The business landscape for global luxury brands has become increasingly challenging in recent years, with market growth slowing down across various regions. According to the joint study conducted by Bain & Company and Altagamma, the global luxury market is projected to experience a decline of 1% to 3% in the first quarter of 2024. Amidst this backdrop, luxury brands are compelled to recalibrate their strategies, embracing price hikes, exploring new avenues, and transforming their approach to connect with consumers. At this pivotal moment of divergent development, effective marketing strategies hold the key to unlocking new growth opportunities.
Challenges Faced by Luxury Brands
Luxury brands today grapple with three primary marketing challenges: accurately identifying their target audience and gaining deep insights into their needs, effectively communicating with consumers to foster quick connections, and assessing the efficacy of omnichannel marketing efforts across online and offline platforms. These challenges underscore the importance of adopting innovative strategies to adapt to the evolving market landscape.
The Rise of Douyin as a Key Platform for Luxury Brands
In the face of these challenges, Douyin has emerged as a formidable platform for luxury brands. During the first half of 2024, the Gross Merchandise Value (GMV) of luxury goods on Douyin surged by over 45%, highlighting its potential as a vital business hub. However, the true success of luxury brands on this platform lies in their ability to harness Douyin’s unique opportunities and address the challenges effectively.
The 2024 Douyin Luxury Industry Summit: Sparking Creativity and Endless Exploration
To equip luxury brands with the tools necessary to thrive in this dynamic environment, Ocean Engine organized the “Spark Creativity, Endless Exploration—2024 Douyin Luxury Industry Summit” on August 20th. This summit showcased comprehensive solutions tailored for luxury brands, encompassing precise audience targeting, scientific content production, and comprehensive brand metrics, aimed at fostering connections with emerging consumer needs, capturing new marketing trends, and enhancing omnichannel experiences.
Segmenting Luxury Audiences Based on Scenarios
With over 600 million Daily Active Users (DAUs), Douyin boasts a vibrant ecosystem of creators and a diverse, cross-generational audience with significant consumption potential. The challenge for luxury brands lies in navigating this vast data landscape to identify their ideal customer base with high economic status, cultural sophistication, and a penchant for quality.
Ocean Engine Yun Tu offers more than 2.3 million audience profiles, enabling luxury brands to precisely segment audiences across various scenarios. For instance, subcultural enthusiasts, highly educated international students, and overseas travelers represent refined audience groups that combine subcultures with mainstream styles, challenging conventions and advancing diversity in fashion. These groups are economically advantaged, often with international exposure, and their passion for luxury products during travel experiences makes them attractive targets for luxury brands.
Moreover, the Generation Z, born between 1995 and 2009, is poised to contribute 100% of the incremental growth in China’s luxury market. To retain this dynamic cohort, luxury brands must engage them with continuously innovative content formats that cater to their rapidly evolving preferences and behaviors. Douyin, with its diverse content formats ranging from trending events to micro-series, offers a premier platform for luxury brands to effectively engage and nurture their target audience.
From Brand Content to Social Scenarios: Unlocking New Horizons with OPUGC
As luxury brands strive to create buzz, styles like Miu Miu girls and intellectual fashion have gained popularity on Douyin. High-end brands such as LVMH, GUCCI, and Cartier have successfully integrated offline events like pop-up exhibitions with online sub-events, enhancing consumer engagement. By aligning high-quality brand content with diverse social scenarios, luxury brands can create more effective marketing environments.
Douyin’s innovative “OPUGC” (Occupationally Generated Content (OGC) – Professional Generated Content (PGC) – User Generated Content (UGC)) interaction model introduces new opportunities for luxury brands in content marketing. This approach focuses on enhancing content value through impact, coverage, and authenticity, driving consumer engagement and brand conversion. By leveraging OGC content, collaborating with fashion, art, culture, and sports influencers to produce engaging PGC content, and fostering spontaneous UGC sharing, luxury brands can achieve triple coverage of brand influence, reach, and reputation.
From Data Integration to Scientific Measurement: Upgrading Omnichannel Business Opportunities through Online and Offline Synergy
With CRM integration, brands can drive fresh traffic by attracting new offline members through online channels. Seamless integration of the product pipeline allows the brand to achieve a full cycle from user targeting and precise guided interactions to driving store traffic. This creates a comprehensive luxury shopping experience for consumers, offering everything from new product delivery and physical displays to appointment services, while exploring more business opportunities across both online and offline.
In summary, Douyin has become a key position for luxury brands to break through. Through accurate target audience reach, scientific content production and omni-channel integration mode innovation, luxury brands can achieve a two-way rush with Generation Z on the Douyin platform. In the future, with the continuous progress of technology and the continuous change of consumer demand, the luxury goods industry on Douyin will usher in more dawn.
