Raf Simons: the Next Fear Generation 2019 Fashion
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Raf Simons: The Next Fear Generation A Belgian brand’s entry into the Chinese market through a collection that celebrates traditional Chinese fashion and modern hip-hop culture through the use of localized digital marketing with social media. 2019 Fashion Scholarship Fund Case Study Design and Product Development Western retailers have a long history of struggling to successfully expand into Asia, and especially China (Rapp, 2018a). With the rise of the Chinese middle class, along with the sheer number of potential consumers in the country, a sufficient presence in China is a lucrative opportunity for many brands. Luxury retailers, in particular, can benefit from the spending habits of Chinese consumers. Chinese consumers currently represent 40% of the global luxury market, and these luxury consumers are often younger with more disposable income than luxury consumers in the West (Maruna, 2017). LEADING WESTERN FASHION RETAILERS Off-White: Off-White is a high-end apparel brand with four years of experience in international expansion. Designer Virgil Abloh opened Off-White’s first brick and mortar store in Hong Kong in 2014, two years after creating the brand (Cruz, 2014). Since then, the American brand has rapidly expanded into additional international markets, such as Toronto, Vancouver, Mykonos, and Macau (Gorsler, 2018). Capitalizing on China’s love of streetwear, Off-White has opened four brick-and-mortar locations in China, each uniquely designed by Abloh himself (Dhillon, 2017). Off-White has been successful at generating hype in the market through China- specific product drops and a Hong Kong exclusive capsule collection to accompany its Hong Kong womenswear store’s opening. The brand has utilized Chinese shoppers’ tendency to look to celebrities and key opinion leaders, also known as the KOLs or wanjong, for style leadership (Ng, 2017). For the 2017 Met Gala, the brand dressed Chinese supermodel Liu Wen in a distinctive denim gown, which was well received by Chinese critics and drew attention to the opening of the Shanghai Off-White flagship store (Rapp, 2018b). Off-White has been taking advantage of Chinese consumers’ tendency to purchase luxury products for their social capital. Its distinctive branding and logo, indicating the high price of its products, have successfully 1 converted consumers looking to gain social capital through their purchases (Rajeck, 2017). Additionally, Off-White has successfully nurtured its consumers’ brand connection through social media; on Instagram specifically, Abloh documents his creative process, resulting in his audience’s increasing attachment to the product (Shwartzberg, 2016). Louis Vuitton: Perhaps the best example of a brand’s taking advantage of social media commerce, or s-commerce, in China, Louis Vuitton has embraced social media applications, including WeChat and Weibo more than any other luxury brand (Zheng, 2018). With an established presence on these applications since 2010, Louis Vuitton has integrated its customer service into WeChat and has become one of the first brands to develop a “brand zone” within the platform, along with Gucci, Cartier, Tiffany, Michael Kors, and Longchamp, as well as other classic luxury brands (Pan, 2018). The brand has taken advantage of the powerful influence of KOLs with a full web presence and celebrities in interactive social media advertisements (Zheng, 2018). To further ensure the consumer’s shopping experience and enhance its luxury brand loyalty, Louis Vuitton has allowed customers to order online and pick up in-store since the 1990s (Zheng, 2018). Comparison of the Two Retailers: Both Off-White and Louis Vuitton have been successful in the Chinese retail landscape in recent years. First, their similarities include their price points, their recognizable logos and branding, their use of brick-and-mortar stores, and their connection to customers through KOLs (Ng, 2017). Second, their products become status symbols due to their high prices and luxury positioning, which attracts Chinese consumers hoping to gain social capital through their expensive purchases (Rajeck, 2017). Third, both brands have cultivated a distinct and successful in-store retail experience for their target consumers. Louis Vuitton encourages online shoppers to pick up purchases in-store so that the 2 customers can positively interact with store associates and solidify their emotional connection to the brand (Zheng, 2018). For Off-White, none of its stores are identical. Each is strategically designed and decorated to create additional ambiance and context around the brand by its creative designer, Virgil Abiloh (Dhillon, 2017). This approach successfully incentivizes Off- White consumers and followers to visit the stores more frequently, and thus feel much more connected to the designer’s vision. However, there are a few key differences between the two brands, predominately between their two dynamic marketing strategies. Off-White relies on hype to fuel consumer attention, supplemented by the occasional use of KOLs (Ng, 2017). On the other hand, Louis Vuitton has continuously been a pioneer in s-commerce with its customers by embracing Chinese social media, such as WeChat, and producing personalized content for its followers (Zheng, 2018). Louis Vuitton is also significantly older than Off-White; the Louis Vuitton atelier has been open since 1859 (Louis Vuitton), while Off-White opened in 2012 (Cruz, 2014). Consequently, Louis Vuitton has had much longer to establish itself as a classic luxury brand and has maintained its status for over a century, while Off-White has grown enormously in just six years to be one of the most prestigious streetwear brands today. FASHION RETAILER CHOICE Raf Simons: With a fluctuating aesthetic over decades of establishing his eponymous Belgian label, Raf Simons has gained popularity through his unique luxury streetwear brand in Europe and America. Raf Simons targets men ages 20 to 40 with clothing priced at a designer price point; however, women commonly purchase and integrate the brand’s pieces into their wardrobes as well (Babcock, 2018). Raf Simons’ target market and inspiration are derived from youth subcultures. The brand has mastered designing pieces to appeal to both the youth the 3 collections represent and the fashion critics watching (Babcock, 2018). Raf Simons utilizes a “DIY” aesthetic to explore youth subcultures and themes of rebellion. His work is a melting pot of all different art forms, including music and fine art, and his integration of art forms outside of fashion is indicative of his start in industrial design before to transitioning to fashion (2018). In his collections, he often shows sweaters and streetwear, as well as militant-inspired pieces. The Raf Simons Spring 2019 collection introduced a formal and tailored streetwear aesthetic for men that ingeniously captured and mixed both couture and streetwear aesthetics (Mower, 2018). This design philosophy captures the culture of and caters to a wide range of consumer groups. Raf Simons has become a leader in revolutionizing the traditional perception and symbolism of streetwear and hip-hop. His work visibly influenced American hip-hop artist and fashion designer Kanye West’s collection, Yeezy Season 1, and his pieces are also frequently integrated into the wardrobes of hip-hop artists, such as Rihanna and Travis Scott (Babcock, 2018). Raf Simons solidified his fame by collaborating closely with artists and integrating their approaches to artistic expression to transform his collections (2018). Benefits from Expanding Internationally into China: Asian consumers already crave Raf Simons. Proof is evident in Tokyo at RS Archives, a capsule vintage shop that has curated early Raf Simons pieces for those in the designer’s “cult of personality” (Kim, 2018). Although Raf Simons opened two capsule stores in Japan in 2008 (“Raf Simons stores”, 2008), no distinct retail presence exists in China, despite the Southeast Asian country’s rapid economic growth. Currently, the Chinese market has a high demand for Raf Simons product and an interest in its deeply rooted ties to hip-hop culture, primarily from the younger generations (Yu, 2018). The brand is well positioned for Chinese expansion. 4 To many western brands, China reflects an enormous opportunity of exploding purchasing power for retail expansion (Rajeck, 2017). A few key trends and benefits support Raf Simons’ strategic global move. Financially, Chinese consumers’ love of luxury products and brands has placed China at the top of global rankings (Deloitte, 2017). At the same time, Chinese millennials today, with support from older family members, have more disposable income and purchasing power, which they spend on trendy luxury goods (Rajeck, 2017). Furthermore, China has a shopping culture of impulse buying. Many brands have further cultivated this pattern using flash sales and baokuan, or “star products”, to generate hype in marketing (Rapp, 2018b). As a luxury brand with deep roots in streetwear, Raf Simons products can benefit from the baukuan effect by marketing to and interacting with Chinese consumers looking for “hyped” streetwear. Operationally, a Chinese retail presence is also geographically close to points of production. By selecting textiles local to China, additional savings can be extracted from an expansion. China’s low cost of manufacturing and the reduced transportation and distribution time provides more benefits for bottom line margin growth for the brand. Aesthetically, many designers of Chinese