People who like you might not pay you, Secoo’s luxury strategy in China

The luxury sale is no easy business in China, even though we think their goddess-like status would easily attract attention, good or bad; just look at the recent racist scandal of D&G as a cautionary tale.

It is said one major challenge for luxury business facing now is:

For instance, a female university student in China who adores the luxury brands might have a much higher volume of search, likes, page views, social sharing in her digital footprint, but it does not necessarily mean she would have the commensurate purchasing capacity, compared with a frequent luxury buyer. Some studies even suggest that new generation of frequent luxury buyers in China now tend to be low key, or social media indifferent in terms of leaving no comments, no likes, no sharing, rather than flaunting around in the past.

So big data analytics generating precision marketing comes to rescue. During a local event, CMO of Secoo, China’s one-stop luxury product & service company with over 20 million customers’ base, shared the company’s long-term vision in marketing, especially leveraging its profound partnership with Tencent.

 

For the 2. online precise MKT, Secoo carved out its own approach under two assumptions:

I. Secoo believes it has its own powerful CRM database that it can leverage

II. Tencent should have comprehensive tags that Secoo can precisely target

Secoo aims to infuse the two data powerhouse together in order to churn out the most accurate digital marketing strategy. But it is going to play a small trick.

The usual logic of a consumer journey is often like below:

Secoo decides to start from reverse, focusing on the last step, the transactional data-purchase customers. For instance,

First, from its CRM, it selects all its customers who have bought Gucci products in the past

Second, it tries to analyze these customers profile and tags, then put them into a so-called  “seeding customer package”.

Third, it entered Tencent Social AD system which currently has over 1.8 billion MAU and more than 300 tags, while using its own “seeding customer package” to map out more targeted customers. In the Tencent Social AD system, Secoo can find who could be those people connect to its seeding customer on Wechat, who could be those people who are actively engaging with its seeding customer, who could be those people who are as similar as its seeding customer…

Fourth, so the “seeding customer package” after planting in the fertile soil of Tencent system can grow into a “tree customer package”, and the next step is just watering it via precision advertising campaign.

During 2017 Wechat moment ad campaign, it split the budget into two and conducted the A/B testing. One is using Tencent’s conventional luxury predefined tags and the other is the amplified seeding customer tags.

Secoo claimed such online marketing strategy worked like a magic, albeit no conversion rate showing here.

Today Secoo concentrates on three major media channels in China for its online marketing campaign. Some might be so curious to ask since all luxury buyers usually are paid subscribers for these online streaming video sites and normally do not see those advertisings, so how Secoo can make its impact? Secoo said those paid subscribers usually leave the trace of its online behaviors and video media are willing to provide these insights and faciliate Secoo’s customer profile analysis. 

By: Cecilia Wu