Gucci Plans to Open Two Flagship Stores on Alibaba Group Holding Ltd.’s (NYSE:BABA) Tmall Platform

Luxury brand, Gucci has joined Alibaba Group Holding Ltd. (NYSE:BABA) to launch two flagship stores so the e-commerce giants luxury shopping marketplace. The fashion label seeks to capitalize on the boom in high-end luxury goods shopping in China post-pandemic to offset dwindling sales in the west.

Gucci products coming to Alibaba marketplace

Gucci is the French group Kering’s profit engine and is among the prized western names open a storefront on the Tmall Luxury Pavilion platform that boasts over 200 brands. The fashion house joins other western luxury brands that have joined the Tmall platform seeking to leverage market opportunities in China as the economy emerges from COVID-19.

According to analysts, the move indicates that luxury fashion brands are putting aside image concerns regarding en masse marketing of their products in China. There have been concerns about selling luxury brands in China because of counterfeiting preferences. Beijing-based consultancy, AmeriChina’s founder, Yang Jingzhu said that the inclusion of luxury brands in Chinese e-commerce platforms could result in a drop in brand image. Yang indicated that the Tmall’s popularity among the rich and the poor could be a massive channel to boost sales.

Gucci to open the first store on December 21

The companies indicated in a joint statement that Gucci’s first store offering a collection of fashion and leather products will open on December 21. On the other hand, the second store focusing on beauty products will open in February 2021, and Coty, Gucci’s license partner will operate the store. China has seen a boom in luxury products shopping this year since the country lifted COVID-19 lockdown measures in the spring.

Bain consultancy predicts that high-end fashion sales in China could grow by almost half this year to around $52.9 billion because of travel restrictions that pushed shoppers to buy online.Before the pandemic, Chinese shoppers accounted for 35% of fashion brands’ goods purchases and will account for almost half of the global sales by 2025 according to Bain research. This year eCommerce platforms will account for around 23% of all luxury sales.