DFS and Douyin join forces to transform luxury retail in China

DFS Group, the world’s foremost luxury travel retailer, and Douyin Life Service, China’s leading short-video platform, have forged an unprecedented alliance, heralding a new era of shopping experiences tailored to Chinese travellers.

The collaboration, which launched with a groundbreaking livestream event showcasing an array of beauty products, brings a pioneering “phygital” shopping model to the discerning Chinese customer. 

Blending the realms of physical and digital retail, the partnership promises an immersive and convenient shopping journey for millions of Douyin users seeking luxury goods.

DFS’ executive vice president for global marketing and digital ventures, Long Chiu, expressed enthusiasm for the alliance, emphasising the brand’s unwavering commitment to innovation and customer-centricity. 

Chiu noted the collaboration’s success in attracting new customers from mainland China while generating substantial e-commerce revenue for both DFS and Douyin Life Service.

With plans to expand collaboration to DFS stores in Macau, the alliance promises to extend its reach and redefine luxury retail experiences across borders.

The partnership

According to Chiu, the partnership came about as DFS has always prioritised innovation to enhance customer experiences. 

“Recognising Douyin’s massive popularity in China, DFS approached them to pioneer a cross-border livestream commerce model linking their 600 million users to DFS offerings,” he told Inside Retail.

This resulted in DFS becoming Douyin Life Service’s first overseas retail partner, launching a phygital shopping model through four-day beauty product livestreams in November 2023. 

Chinese viewers could conveniently purchase cash cards on Douyin for instant redemption at any of DFS’ Hong Kong stores.

“Audiences could engage directly with livestream hosts to gain valuable product insights and learn about promotional offers such as cash cards. Customers also benefited from the ability to redeem cash cards quickly and easily by scanning Douyin app QR codes,” he said.

This streamlined the shopping experience when compared to physical cash card redemption. The seamless integration within the Douyin mobile app created an enhanced level of convenience for DFS customers.

The phygital shopping model

Traditionally, online and offline shopping always existed as separate experiences. But now, the ‘phygital’ shopping model is becoming the new normal.

According to Chiu, the experience enhances discovery, as Douyin’s live streaming platform allows customers to research the curated selections introduced by hosts and then decide if they want to make a purchase later.

Secondly, it expedites redemption. Shoppers enjoy fast checkouts simply by scanning cash cards on the Douyin app at any DFS store in Hong Kong or Macau.

“By integrating online selection, digital payment, and swift physical redemption, the phygital model optimises touchpoints. It elevates the luxury shopping journey into a unified, enriching omnichannel experience spanning virtual and tangible realms,” he pointed out.

So far the statistics show that 30 per cent of direct revenue from the first livestream event came from new customers.

“We plan to further expand cash card redemption locations to Macau in future. This geographic diversification presents Chinese travellers more opportunities to conveniently access exclusive luxurious offerings across destinations,” he explained.

In terms of continued enhancements to the seamless payment solution, the company is also accepting Alipay payments and Douyin QR codes in order to eliminate barriers and optimise the shopping experience from online discovery to in-store purchases.

Strengthening loyalty

According to Chiu, by showcasing coveted brands and collections through livestreams on Douyin, DFS Circle (global loyalty program) members are motivated to leverage attractive cash cards. 

Members who spend more achieve higher membership status, and upgrading to higher tiers such as Gold allows members to unlock global privileges like airport lounge passes.

“The partnership strategically engages DFS patrons in consistently spending more to maintain or surpass their status levels. This ongoing incentivization strengthens members’ loyalty, retention and lifetime value to DFS,” he added.

Chiu said DFS plans to scale the Douyin shopping model to Macau in the near future, as the company’s travel retail expertise and Douyin’s social influence promises an exciting ecosystem for Chinese travellers.

“Through livestream content curated for Chinese viewers’ needs, the groundbreaking partnership with Douyin Life Service has significantly boosted DFS’ visibility in Mainland China among Douyin’s massive 600 million user base in efficient new ways,” he stressed.

Onwards and upwards

To deepen engagement in the Chinese market, Chiu said that DFS is also expanding its physical footprint. 

“This includes our presence in Chongqing Jiangbei Airport, with over 30 luxury brands. We are also making a momentous planned investment in Hainan through the landmark development of DFS Yalong Bay,” he noted.

According to Chiu, spanning 128,000sqm with 1000+ iconic brands, DFS Yalong Bay will become Hainan’s premier luxury shopping and entertainment destination, attracting over 16 million visitors annually by 2030.

“By integrating pioneering digital partnerships that build our brand online with expanded high-profile physical store representations across priority Chinese travel markets, we are strongly placed to unlock this key luxury travel retail opportunity for decades to come,” he elaborated.

Ultimately, Chiu believes that the partnership with Douyin Life Service exemplifies DFS’ digital transformation strategy of integrating innovative technologies into seamless omnichannel experiences for luxury travellers.

“More broadly, we are exploring emerging technologies to elevate every aspect of the luxury travel retail experience. Advanced data and analytics are helping to deliver hyper-personalised brand engagements with our customers,” he concluded.

The post DFS and Douyin join forces to transform luxury retail in China appeared first on Inside Retail Australia.