Alibaba Group Holding, a renowned Chinese e-commerce giant, has reportedly unveiled a new luxury platform focused on young customers which also aims to help several high-end brands get rid of extra inventory that has been built up during the coronavirus lockdown.
Chinese customers account for over a third of the global luxury goods expenditure and China is the key marketplace was hit severely by the COVID-19 pandemic, which pushed companies to shut shops and also led to the virtual halt of international traveling.
As the virus reached the United States and Europe, Chinese shoppers gradually emerged from a big lockdown that lasted for weeks, and most of the labels have been observing a recovery in their sales since March.
However, the COVID-19 pandemic has disturbed the warehouse planning and supply chains throughout the world. This disruption has left fashion groups with substantial amounts of unsold goods, while Chinese customers, who mostly used to buy when traveling outside the country, are now shopping at their homes.
Alibaba stated that it was directing the Luxury Soho platform to operate with its Tmall Luxury Pavilion flagship site.
Head of Tmall Fashion and Luxury in Europe, Christina Fontana stated that several brands across the world are currently sitting on an international abundance of their respective stock and are also in a deep need to find ways to reach out to new customers.
Fontana added that while Luxury Pavilion will still continue to provide exclusive services and the latest collections from brands, focusing on a clientele that is more affluent, the Soho platform would feature timeless classics, vintage collectibles, luxury deals, and older collections.
The new Alibaba platform would enable brands to operate their own respective online stores with complete control over the pricing, product strategy and selection.
The Soho platform would allow high-end brands reach out to newer shoppers like those from the lower-tier-cities of China or the so-called Gen Z shoppers, young generation aged 25 and below who are just entering into the domain of luxury and are projected to be significantly important for the sector.