Jing Daily, February 26, 2019, by Daniel Langer, CEO of Équité
At this week’s Milan Fashion Week, something was odd. While at most fashion shows there was a significant number of Chinese fashion journalists and high-profile customers alike, one brand was different — Dolce & Gabbana (D&G). As pointed out by the influential South China Morning Post, there was only a handful of Chinese media present, and when prompted, some of them stated that while they were there, they wouldn’t even cover the show in their media. High-profile editors like Angelica Cheung, the editor-in-chief of Vogue China, were not even present.
This is remarkable given that three months have now passed since D&G canceled their Shanghai show after the social media outcry and boycotts from retailers, celebrities, brand ambassadors and consumers, following their infamous Chinese advertising campaign, and the unfortunate handling of it.
Three months, in which D&G, should have been repairing its damaged reputation with their Chinese stakeholders credibly. The Milan Fashion Show would have been the perfect venue — even set in their home country — to demonstrate to China and the rest of the world that the issue was taken seriously, wounds were healed, and it was now time to move on and refocus on fashion.
However, it seems that D&G did not use the time to their advantage. As the South China Morning Post also noted, there were almost no Asian models showing the collection, which was highly unusual compared to past D&G shows. If the brand was serious about rebuilding its trust and connection with its Chinese consumers, this is just one of several aspects the brand should have set up differently.
This is remarkable for many reasons. First, Chinese consumers have become the most influential market for luxury brands. Worldwide they account for the majority of luxury purchases, and despite the recent slowdown of the growth rates of the Chinese economy, China will still outgrow all other luxury markets by far during the next decade. Additionally, Chinese consumers are among the youngest in the world, very savvy, highly sophisticated and demanding — certainly a market to be catered to properly.
One factor that many managers of luxury brands underestimate is the symbolic relationship that consumers have with their brands. I go as far in my publications and workshops as describing it as a love relationship.
“I fell in love with that handbag,” quoted a top-manager of a leading luxury brand, in a leadership seminar I conducted in Asia. When we started an in-depth discussion about the reasons for her purchase, every element she mentioned was an aspect of love: about courting, anticipation, an accelerated heartbeat the moment she entered the store.
This is an insight that managers of luxury brands need to take seriously: If the decision to purchase a luxury brand is based on love, then a company needs to do everything to keep that love alive. And if there are issues, like in any successful relationship, they need to be addressed in an authentic, credible and consistent way. Too often, love can turn into pain and melt into hatred when a relationship ends. Luxury brands need to be aware of this. And now, with social media, any perceived breakup between a consumer and a brand will be made public immediately.
Pictures will be posted; comments will be stated over and over. This is what happened to D&G three months ago. And this is why the damage is so big.
To fix this, I would have recommended a thorough situation analysis, implement digital and managerial processes that would help a global company to think and act locally, and lastly, focus on rebuilding brand equity. Looking at D&G’s Milan Fashion Show, it seems that none of this was done. Even worse, by drastically reducing the number of Chinese models, D&G signals a deemphasizing of the Chinese market and its consumers — the exact opposite of what was needed to restore trust.
To turn their situation around, D&G will need to step up their efforts to reconnect with their audience in China and heal the wounds. It starts with gaining deep real-time insights about what consumers think and talk about when it comes to the brand. The use of Artificial Intelligence technology to aggregate social content online, store traffic and sales data, and to identify key influencers would be ideal. AI is a game-changing tool for the strategy and marketing process, perfect for helping develop effective and fast strategies on how to adjust communication channels, content and budgets. They need to address Chinese consumer’s hearts swiftly and with a relevant and authentic message that addresses their conversations and concerns. With those insights, their brand strategy can be adjusted quickly. Loyalty and trust can be rebuilt.
Fashion is one of the fastest paced businesses. Three months can seem like an eternity. D&G should not waste another three months to make a heartfelt comeback in China. Now is the time to act.