Reebonz Asia Luxury Index 2016 by Style Files by REEBONZ

ASIA LUXURY

INDEX 2016

IN THIS REPORT 1. THE LUXURY STOCK EXCHANGE A WINNING GAME PLAN 4 BUILDING Expenditure growing faster than transactions,

suggesting new strategies for brands and retailers looking to play to win

INSIDE THE WORLD OF LUXURY A deeper look into the world of luxury and what consumers are shifting towards

EXPERTS ON WHAT’S WORTH 9 5THELUXURY INVESTMENT

The stocks that are hot, those on the rise, and the luxury brands you should buy into

2. POPS & DROPS: BAGS SETTING THE PACE IN ONLINE SALES

3. AS SHOPPERS MIGRATE ONLINE, WHICH ARE THE BLUE CHIP BRANDS? WATCH: THE LUXURY RESALE INDEX 19 STOCK Taking stock of the most valuable brands and products LUXURY FILES: A LOOK AT THE 21 THE BLUE CHIP BRANDS The top four most valuable luxury brands ranked by Millward Brown in 2016 perform just as strongly online as offline STOCK OF CULT BRANDS 24 TAKING The parameters of luxury are changing. Brands with niche followings are sharing space with big names in the luxury portfolio

4. LUXURY, TOMORROW

OR TIMEPIECES? HEDGE YOUR BEST BETS OF THE LUXURY SHOPPING 11 BAGS 27 EVOLUTION Sure, bags are the heavyweights in the online luxury ECOSYSTEM scene, but timepieces and shoes are coming in as strong contenders as well

Digital has enticed shoppers online, while the role of the shopper has evolved too

NEW OR PRE-OWNED: DOES IT MATTER? NAVIGATING THE NEW GRID OF LUXURY 13 BRAND New is better? Or old is gold? More luxury consumers 28 SHOPPERS are starting to buy into pre-owned designer pieces

GUIDE TO LUXURY’S HOTTEST 17 INSIDER’S SECTOR: BAGS As luxury consumers snap up bags, here are seven things to look for before you buy one

Creating value is key for brands and retailers to draw luxury consumers FUTURE OF THE LUXURY STOCK EXCHANGE 31 THE Reebonz’s founders deconstruct luxury shopping in the next decade

INTRODUCTION The 2016 Asia Luxury Index marks the first series of Reebonz’s efforts to track the performance of the online luxury ecosystem, as technology, slowing economies and an increasingly sophisticated consumer have led global luxury names to turn to digital as a source of growth. The results reveal that while the blue chip brands like Chanel and Hermès remain top performers, cult brands like Givenchy and Lanvin that have a niche following are starting to gain traction with luxury consumers in Asia as well. Bags emerged as sector leaders in the luxury stock exchange, with every two in three transactions consisting of bags. However, timepieces have chipped away at this lead, with consumers showing a growing appetite for the watch sector. Shoes too, have come up as a contender, with Singapore, Indonesia and Malaysia charting the biggest gains. Whilst luxury shoppers used to have strong leanings towards new high-end items, chart patterns reflect an uptick in pre-owned luxury pieces. Across all sectors, luxury super brands dominate the pre-owned category, an indicator of the high perceived value of a blue chip brand regardless of prior ownership. Drawing on the key insights derived from Reebonz’s latest sales data across Australia, Hong Kong, Indonesia, Malaysia and Singapore, we note that luxury is entering a new bull market as the luxury ecosystem evolves. Shoppers are migrating online, and new sectors and brands such as Givenchy and Lanvin are fueling the world of online luxury shopping, indicating another strong run in the next decade.

IN THIS REPORT 1. THE LUXURY STOCK EXCHANGE A WINNING GAME PLAN 4 BUILDING Expenditure growing faster than transactions,

suggesting new strategies for brands and retailers looking to play to win

INSIDE THE WORLD OF LUXURY A deeper look into the world of luxury and what consumers are shifting towards

EXPERTS ON WHAT’S WORTH 9 5THELUXURY INVESTMENT

The stocks that are hot, those on the rise, and the luxury brands you should buy into

2. POPS & DROPS: BAGS SETTING THE PACE IN ONLINE SALES

4. LUXURY, TOMORROW

Digital has enticed shoppers online, while the role of the shopper has evolved too

NEW OR PRE-OWNED: DOES IT MATTER? NAVIGATING THE NEW GRID OF LUXURY 13 BRAND New is better? Or old is gold? More luxury consumers 28 SHOPPERS are starting to buy into pre-owned designer pieces

GUIDE TO LUXURY’S HOTTEST 17 INSIDER’S SECTOR: BAGS As luxury consumers snap up bags, here are seven things to look for before you buy one

Creating value is key for brands and retailers to draw luxury consumers FUTURE OF THE LUXURY STOCK EXCHANGE 31 THE Reebonz’s founders deconstruct luxury shopping in the next decade

Note from

THE FOUNDERS

It is fascinating to see how our luxury ecosystem has evolved in a time when the entire environment in which brands and retailers are operating has been transformed. Seven years ago, Reebonz started as a platform for flash sales. Today, we are the number one online luxury retailer in Southeast Asia, with over 4 million members, 550 designer brands and over 100,000 products. We have also added new capabilities – Reebonz Closets, Reebonz Marketplace and White Glove – to our repertoire of services, opening up new avenues for luxury consumers to buy and sell new and pre-owned items on our platforms. Luxury shopping is a consumption journey, and Reebonz has continued to evolve alongside our consumers and their shifts in habits and preferences. At Reebonz, we were interested in how the balance of power in the luxury landscape is shifting to the online channel, and decided to create our first benchmarking report of what we have termed the ‘Luxury Index’. Looking at sales data and industry reports, we have scoured the industry’s competitive landscape to provide an in-depth qualitative and quantitative analysis of the online luxury sector as it stands today. We have compiled a ranking of what we think are the most powerful brands in luxury – or the blue chip brands, and it will not come as a big surprise that the list is dominated by the luxury heavyweights. What was interesting however, was that cult brands with niche followings are gaining share, indicating a mixed portfolio of both super brands and niche labels for luxury consumers. In this report, you will also find perspectives on the future direction that the luxury ecosystem will take, framed within the context of key patterns and trends that emerged from the data. We also speak with industry experts – WGSN Senior Editor (Asia Pacific), Erica Ng, and Associate Professor of Marketing at the National University of Singapore (NUS), Dr Prem Shamdasani – to get their thoughts on the future state of the luxury stock exchange. In a market moving at the speed of light, here is our take on how luxury brands and retailers should stay ahead of the curve.

— Samuel Lim, Daniel Lim & Benjamin Han

THE LUXURY STOCK EXCHANGE

Note from

THE FOUNDERS

— Samuel Lim, Daniel Lim & Benjamin Han

THE LUXURY STOCK EXCHANGE

BUILDING A WINNING

GAME PLAN

Expenditure growing faster than transactions, suggesting new strategies for brands and retailers looking to play to win

s the retail climate grows increasingly uncertain, many luxury brands have been struggling to sell, with some hit particularly hard because of their exposure to China. Concerns over China aside, Australia enjoyed record low interest rates and inexpensive credit last yeari, while Indonesia abolished tax on luxury goodsii and the number of high net worth individuals in Singapore roseiii – all of which created a more favourable environment for online luxury shopping.

EXPENDITURE GROWTH Shoes, bags and timepieces recorded highest growth in consumer expenditure in 2015v Percentage increase in expenditure

50%

Expenditure Growing Faster than Transactions When it comes to buying new luxury items, consumers are splurging on higher-priced goods online. Consumers are increasingly dependent on online luxury platforms to purchase new accessories, apparel, bags, jewellery, shoes, small leather goods and timepiecesiv. While luxury purchases maintained at a steady momentum in 2015, Asian consumers in fact spent more on luxury items – growing by 50% from 2014 to 2015 – according to sales figures from leading online luxury retailer Reebonz. Spending on shoes rose by a substantial 87%, followed by bags (56%) and timepieces (39%). Comparatively, the number of transactions made grew by 64% for shoes, 54% for bags and 42% for timepieces.

}

Percentage increase in transactional growth

TOTAL 37% SHOES

87%

64%

56%

39%

BAGS

54%

STRUCTURING A GAME PLAN FOR ONLINE LUXURY SHOPPING Combining these shopping patterns with the growing trend of consumers moving online, how should brands and retailers play to win? Reebonz CEO, Samuel Lim, shares three key strategies for luxury brands and retailers to gain ground online:

1. Focus on quality, not quantity

“Shoppers are starting to have a more considered approach towards online luxury buys, but that doesn’t mean they are spending conservatively. Brands and retailers should focus on creating value in their products – such as limited editions or quality craftsmanship – to target the luxury consumer. As luxury is not about mass production, consumers are more willing to spend more for value – and not merely in the monetary sense but on the pieces that they are buying.”

2. Create liquidity

TIMEPIECES 42%

i. http://www.drapersonline.com/business-operations/opportunities-down-under-australian-retail-expansion/5078299.fullarticle ii. http://www.euromonitor.com/luxury-goods-in-indonesia/report iii. http://www.affluential.com/wp-content/uploads/2015/10/2015-W1-Summary-Luxury-SG1.pdf iv. http://www.mckinsey.com/industries/retail/our-insights/luxury-shopping-in-the-digital-age v. Based on growth in total trasanctions and sales of Reebonz products between 2014 and 2015

3. Digitising the Luxury World

“People who are aspiring to acquire luxury are becoming more digitally savvy. The luxury world has to digitally evolve to accommodate the young generation who is primed for affluence in the coming years. Millennials are spending more and more time researching on luxury goods before purchasing; they treat their luxury consumption as a journey, and this is pursued online. The challenge for brands therein lies in creating an experiential journey on the Internet. Our business model has definitely evolved alongside the changing needs of our customers, to offer the best services and experiences at every single customer touchpoint. ”

“The retail industry is undergoing a reset, and it’s not just because of digital. The role of the shopper within the online shopping ecosystem is also changing. Consumers are recognising that there is a growing demand for pre-owned luxury and realising that there is liquidity in their closets. They are playing both roles of buyer and seller. Reebonz has evolved into an ecosystem that accommodates customers interested in buying and selling with us. We have transformed the regular B2C model with expanded capabilities to serve the C2C and even B2B2C segment.”

BUILDING A WINNING

GAME PLAN

Expenditure growing faster than transactions, suggesting new strategies for brands and retailers looking to play to win

EXPENDITURE GROWTH Shoes, bags and timepieces recorded highest growth in consumer expenditure in 2015v Percentage increase in expenditure

50%

}

Percentage increase in transactional growth

TOTAL 37% SHOES

87%

64%

56%

39%

BAGS

54%

1. Focus on quality, not quantity

2. Create liquidity

TIMEPIECES 42%

3. Digitising the Luxury World

Inside the WORLD of

LUXURY

A deeper look into the world of luxury and what consumers are shifting towards

Luxury consumers in Asia are snapping up bags, small leather goods and shoes online. While most markets reflected similar shopping trends, Singapore consumers reveal a strong appetite for timepieces, with this sector coming in third. For new luxury bags, Prada, Chanel and Balenciaga topped shoppersâ&#x20AC;&#x2122; lists, while Salvatore Ferragamo led the luxury footwear sector. In the pre-owned category, luxury heavyweights Chanel, Louis Vuitton and Prada controlled the bag category, emerging as the most preferred brands for consumers. When it comes to total transactions, bags maintained a commanding lead as the top product sector across both the new and pre-owned luxury category.

Items classified under Accessories include eyewear, belts and jewellery

Bags Lead

LUXURY STOCK EXCHANGE

Inside the WORLD of

LUXURY

A deeper look into the world of luxury and what consumers are shifting towards

Items classified under Accessories include eyewear, belts and jewellery

Bags Lead

LUXURY STOCK EXCHANGE

5 Luxury Experts on

WHAT’S WORTH THE INVESTMENT The stocks that are hot, those on the rise, and the luxury brands that you should buy into

A look at the current data from Reebonz indicates that the luxury big names like Chanel, Louis Vuitton and Prada are still top performers in the online category. Retail expert Dr. Prem Shamdasani, Associate Professor of Marketing from the National University of Singapore (NUS), believes the super brands will continue to dominate, along with Reebonz co-founders Samuel Lim, Daniel Lim and Benjamin Han who pick Chanel and Hermès as blue chip brands that consumers should continue to buy into. Offering a

different point of view, luxury industry expert Erica Ng, Senior Editor (Retail Intelligence) of global trends authority WGSN, suggests homegrown luxury brands coming out from Asia are new players to watch. With an impressive inventory that ranges from new pieces to rare vintage items from both luxury heavyweights and independent multi-label boutiques, Reebonz makes the ideal platform for consumers looking to snag a new investment piece.

“There has been a lot of focus on emerging brands in the luxury market but the truth is heavyweights never needed to make a comeback - they never left. Chanel and Hermès have such strong brand positioning and loyalty not just globally but also in Asia. There is a sustained demand for both brands within the region, each trumpeting growth in sales across the new and pre-owned luxury categories.” Samuel Lim, CEO, Reebonz

“People who are interested in venturing into the world of luxury should definitely look into Hermès. The French luxury powerhouse remains very much a symbol of status, especially with highly coveted pieces like the Birkin. Ultra-luxury makes for a stable investmest; rare and sought-after leather goods from Hermès never lose their value, even in times of recession.” Daniel Lim, Chief Brand Officer, Reebonz

“People are overlooking popularity for quality and exclusivity these days. Despite being a popular brand for generations, Chanel continues to maintain its timelessness and grasp on its ‘exclusive’ status. Owning a Chanel propels consumers who aspire to move up to the top of the luxury hierarchy.” Benjamin Han, Regional General Manager, Reebonz

“Luxury brands coming out of Asia is worth to watch. Chinese shoppers with their prolific spending power are increasingly paying attention to homegrown brands as they take pride in Chinese designs. Contemporary and premium brands from South Korea are unstoppable in China and their influence is growing globally as more artists and stylists are looking to Korean pop culture for the next trend.” Erica Ng, Senior Editor, Retail Intelligence (Asia Pacific), WGSN

“The super brands will continue to dominate the luxury landscape as they have the deep pockets to continuously invest in strengthening their product portfolio through brand stretching and extensions. This applies to their digital platforms and services to offer personalised and convenient shopper experiences both online and offline.” Dr Prem Shamdasani, Associate Professor of Marketing, NUS

Items classified under Accessories include eyewear, belts and jewellery

5 Luxury Experts on

WHAT’S WORTH THE INVESTMENT The stocks that are hot, those on the rise, and the luxury brands that you should buy into

Items classified under Accessories include eyewear, belts and jewellery

BAGS or TIMEPIECES? HEDGE YOUR BEST BETS

Sure, bags are the heavyweights in the online luxury scene, but timepieces and shoes are coming in as strong contenders as well

uxury spending went up across all sectors in 2015, with bags and small leather goods taking a lionâ&#x20AC;&#x2122;s share of the market. Shoes and timepieces came in as the surprising gainers in terms of sales value, rising by 87% and 39% respectively^, indicating a growing appetite among luxury consumers.

POPS & DROPS:

Although bags remain the runaway winner in online luxury sales, Euromonitor International predicts that they are becoming more commonplace and less exclusive as the status symbol that they once were#. As consumersâ&#x20AC;&#x2122; demand for luxury goods streams away from the conventional, brands and retailers can expect a rise in sales across other categories like shoes and timepieces.

INVESTING IN LUXURY? CONSIDER THESE PRODUCT SECTORS Still Bestsellers

Bags still reign bestsellers, appearing on every two in three online shopping orders on Reebonz

Walkaway Champions

Shoes are the biggest gainers in terms of sales value, rising by an impressive 87%

BAGS SETTING THE PACE IN ONLINE SALES Catching Up Quickly Timepieces record a 39% increase in revenue

^Based on expenditure growth of shoes and timepieces sold on Reebonz from 2014 to 2015. #Euromonitor International. (2016). Luxury Goods in Singapore. Retrieved from: http://www.euromonitor.com/luxury-goods-in-singapore/report

BAGS or TIMEPIECES? HEDGE YOUR BEST BETS

Sure, bags are the heavyweights in the online luxury scene, but timepieces and shoes are coming in as strong contenders as well

POPS & DROPS:

INVESTING IN LUXURY? CONSIDER THESE PRODUCT SECTORS Still Bestsellers

Bags still reign bestsellers, appearing on every two in three online shopping orders on Reebonz

Walkaway Champions

Shoes are the biggest gainers in terms of sales value, rising by an impressive 87%

BAGS SETTING THE PACE IN ONLINE SALES Catching Up Quickly Timepieces record a 39% increase in revenue

BRAND NEW OR PRE-OWNED,

DOES IT MATTER?

New is better? Or old is gold? More luxury consumers are starting to buy into pre-owned designer pieces

new age of Asian affluence and an evolving luxury ecosystem is changing perceptions towards pre-owned luxury. Latest data from Reebonz reveals a 30% growth in the preowned category, with sales in bags and shoes making the biggest gains in terms of sales volume. Luxury for Less, also for the Rich and Famous Celebrities such as Elle Fanning, Shailene Woodley and Sophie Ellis-Bextor are known for shopping for resale luxury goods, and the trend of buying luxury for less has started to catch on in Asia. If you are still not convinced, just take a cue from style icons like Julia Roberts, Nicole Kidman and Renee Zellweger who have all worn one-ofa-kind vintage designer pieces to create an inimitable red carpet image. While Asian luxury consumers used to go for swanky new pieces, more are starting to see the value in pre-owned luxury items. “Asian consumers are generally wary about pre-owned goods, but there is a gradual shift happening driven by a sense of nostalgia,” describes Erica Ng, WGSN Senior Editor, Retail Intelligence (Asia Pacific). “As technology pushes our pace of life faster, we seem to be craving slowness and simplicity.”

“We see that in the resurgence of little things like calligraphy, pocket diary, and vintage luxury items. The issues of cleanliness and quality will remain, but there is a growing appetite for pre-owned luxury goods particularly in accessories like handbags,” she continues. Dr Prem Shamdasani agrees, “The appetite for buying pre-owned luxury is going to get stronger in the future as shoppers become more pragmatic or value-conscious in their expenditures on luxury brands. They are more willing to buy new, pre-owned or even rent a mixture of luxury and mainstream brands to create the desired ensemble of clothing and accessories that define their lifestyle choices.” Solving the Question of Authenticity Though questions about authenticity once loomed over the pre-owned category, the emergence of trusted platforms like Reebonz is creating a vibrant exchange for consumers to come together to buy and sell preowned luxury items. At Reebonz, all pre-owned items are first authenticated and graded by their experienced professionals before the piece is issued a Reebonz Atelier Authenticity Card. Watches and jewellery also come with a Grading Certificate that contains detailed information issued by their in-house luxury experts, so consumers can shop with peace of mind that every product sold is guaranteed authentic.

SPOTTED IN VINTAGE Left to right: Julia Roberts, Nicole Kidman and Renee Zellweger in vintage looks on the red carpet. These looks, and their dresses, have since become iconic moments in Hollywood fashion.

BRAND NEW OR PRE-OWNED,

DOES IT MATTER?

New is better? Or old is gold? More luxury consumers are starting to buy into pre-owned designer pieces

CELEBRITIES WHO PRE-OWNED

love

& VINTAGE SHOPPING “For my own style, I love vintage. ‘60s and ‘70s are my favourite. I love baby doll dresses and the soft colours. I try to mix a little bit of modern into that – maybe I’ll wear it with boots.” Elle Fanning, American actress

Kitson? Yeah, that’ll never happen. I exclusively buy used clothes. I’m going to be a citizen of this planet, and I’m going to do my responsibility and live in stride with nature instead of constantly fighting against her.” Shailene Woodley, American actress

“I’m really interested in fashion but at the same time I find it quite competitive. Second-hand stuff leaves you more open to whatever your own personal style is rather than feeling dictated to by shops.”

BUYING PRE-OWNED LUXURY? GO WITH

BLUE CHIP BRANDS

look at the latest sales data from Reebonz shows blue chip brands posting strong performances in the pre-owned category, with Chanel, Louis Vuitton, Hermès and Prada easily topping the charts. It appears that the luxury players that manage to create a high perceived value of their brand are most successful when it comes to maintaining their dominance even in the pre-owned category. While it is difficult to forecast the long term worth of most new products, luxury goods that have stayed off the shelves for some time have a reliable record of value, especially for blue chip brands. A Chanel Jumbo Flap Bag could fetch up to $1,500 more than its original retail value^ in the US while a Goyard bag could be resold at 130% of its retail price*. Thanks to the Internet, savvy consumers can now project the value of a luxury pre-owned item based on a recent transaction. If the continued growth of pre-owned luxury means anything, it’s that consumers are increasingly overlooking the distinction between brand new and pre-owned goods. Consumers are no longer buying into novelty, but also true luxury – as they become savvier with research, it is the intrinsic value and exclusivity of a luxury piece that they are after. ^Refinery29. (2014). In the Case of Chanel, “Investment” Actually Means Investment. http://www.refinery29.com/chanel-bags-investing *Racked. (2016). What Designer Bag Has the Best Resale Value?

Sophie Ellis-Bextor, British singer-songwriter and model

“Vintage clothing is not only glorious and stylish, it’s also the way forward in terms of recycling. Whenever I go into great vintage stores, I wonder why we ever buy new things.” Thandie Newton, British actress

“I’ve always loved fashion so much and I didn’t have access to the kind of fashion I really wanted, so I would do vintage shopping.” Rachel Roy, American fashion designer

CELEBRITIES WHO PRE-OWNED

love

BUYING PRE-OWNED LUXURY? GO WITH

BLUE CHIP BRANDS

Sophie Ellis-Bextor, British singer-songwriter and model

“I’ve always loved fashion so much and I didn’t have access to the kind of fashion I really wanted, so I would do vintage shopping.” Rachel Roy, American fashion designer

INSIDER’S GUIDE TO LUXURY’S HOTTEST SECTOR: BAGS As luxury consumers snap up bags, here are seven things to look for before you buy one

hen a sales assistant told Samantha Jones in an episode of Sex and the City, “It’s not a bag, it’s a Birkin,” that quip perhaps best summed up the general sentiment surrounding the iconic bag. Thirty years after its creation, the Hermès Birkin has since earned a reputation as the ultimate status symbol. With 60% of online luxury sales on Reebonz coming from bags, this sector is an obvious choice for brands and retailers to stock up on.

Yet for the consumer faced with an overwhelming selection of bags, picking a winner might not be as easy as it seems. As industry analyst Beth Goldstein describes, buying a bag is an investment into one’s style and personality; just like buying a car, the motivation to own a bag can be affected by a lot of factors, such as social trends or one’s research. Here’s what you should know before investing in an It bag.

INSIDER’S GUIDE TO LUXURY’S HOTTEST SECTOR: BAGS As luxury consumers snap up bags, here are seven things to look for before you buy one

AS SHOPPERS MIGRATE ONLINE, WHICH ARE THE

BLUE CHIP BRANDS?

STOCK WATCH

THE LUXURY RESALE INDEX Taking stock of the most valuable brands and products

CAPITAL IN THE CLOSET

For luxury consumers looking to pick up an investment piece, Reebonz has put together a list of the top ten most valuable luxury brands and bags that the savvy shopper should consider when making a purchase. So which brands made The Resale Index? Reebonz has taken a look at the resale value of key pieces that reflect how strongly a brand holds its value even in the resale market.

SNAP: upload photographs of your items

he Asia Luxury Index sees the world of luxury within the context of a stock exchange. As with stocks, valuation helps determine the luxury brands and products that consumers should be buying into.

The new standalone Reebonz Closets app makes buying and selling pre-owned luxury a seamless and hassle-free experience. In just three simple steps, users can start selling to turn their closets into cash:

SELL: converse and negotiate price with members via the in-app chat to reach a consensus GET PAID: receive funds in three business days once the item has been sold The newly relaunched Reebonz Closets app, together with the existing Reebonz app, is available on the App Store and Google Play for Apple and Android devices respectively. Alternatively, visit www.reebonz.com/closets.

AS SHOPPERS MIGRATE ONLINE, WHICH ARE THE

BLUE CHIP BRANDS?

STOCK WATCH

THE LUXURY RESALE INDEX Taking stock of the most valuable brands and products

CAPITAL IN THE CLOSET

SNAP: upload photographs of your items

he Asia Luxury Index sees the world of luxury within the context of a stock exchange. As with stocks, valuation helps determine the luxury brands and products that consumers should be buying into.

STOCK WATCH

THE LUXURY RESALE INDEX Taking stock of the most valuable brands and products

GO-TO PIECES These bags fetch higher prices than their original retail price

1 Hermès Epsom Birkin 25

Resale Index: 125% of Retail Price

3 RELIABLE BETS These bags hold their value well despite prior ownership

Chanel 2.55 Reissue 226

Resale Index: 75% of Retail Price

5 Lady Dior Medium Bag

Resale Index: 67% of Retail Price

2 Hermès Lindy 26

Resale Index: 120% of Retail Price

4 Chanel Jumbo Classic Flap Resale Index: 75% of Retail Price

6 Louis Vuitton Speedy Bandoulière 30 Monogram Resale Index: 62% of Retail Price

7 STEADY DEMAND These bags sell at a less expensive price but still attract a good market of second-hand buyers

Balenciaga Giant Silver City Resale Index: 54% of Retail Price

8 Louis Vuitton Neverfull PM Monogram

Resale Index: 50% of Retail Price

9 Gucci Soho Leather Hobo

Resale Index: 48% of Retail Price

THE LUXURY FILES

A LOOK AT THE BLUE CHIP BRANDS

The top four most valuable luxury brands ranked by Millward Brown in 2016 perform just as strongly online as offline

ouis Vuitton, Hermès, Gucci and Chanel made the top four most valuable luxury brands in Millward Brown’s 2016 ranking of most valuable global brands^ and are without question the most iconic brands in the world.

And even where digital may be a sore spot for some luxury brands, these blue chip brands still remain strong performers even in the online luxury sector as seen from Reebonz’s latest data.

Prada Saffiano Lux Galleria Resale Index: 43% of Retail Price

Based on Reebonz sales data in 2014 and 2015. Resale value is derived from products sold within 1 year in excellent condition with full packaging. ^Millward Brown. (2016). BrandZ™ Top 100 Most Valuable Global Brands. Retrieved from: http://www.millwardbrown.com/brandz/top-global-brands

STOCK WATCH

THE LUXURY RESALE INDEX Taking stock of the most valuable brands and products

GO-TO PIECES These bags fetch higher prices than their original retail price

1 Hermès Epsom Birkin 25

Resale Index: 125% of Retail Price

3 RELIABLE BETS These bags hold their value well despite prior ownership

Chanel 2.55 Reissue 226

Resale Index: 75% of Retail Price

5 Lady Dior Medium Bag

Resale Index: 67% of Retail Price

2 Hermès Lindy 26

Resale Index: 120% of Retail Price

4 Chanel Jumbo Classic Flap Resale Index: 75% of Retail Price

6 Louis Vuitton Speedy Bandoulière 30 Monogram Resale Index: 62% of Retail Price

7 STEADY DEMAND These bags sell at a less expensive price but still attract a good market of second-hand buyers

Balenciaga Giant Silver City Resale Index: 54% of Retail Price

8 Louis Vuitton Neverfull PM Monogram

Resale Index: 50% of Retail Price

9 Gucci Soho Leather Hobo

Resale Index: 48% of Retail Price

THE LUXURY FILES

A LOOK AT THE BLUE CHIP BRANDS

The top four most valuable luxury brands ranked by Millward Brown in 2016 perform just as strongly online as offline

And even where digital may be a sore spot for some luxury brands, these blue chip brands still remain strong performers even in the online luxury sector as seen from Reebonz’s latest data.

Prada Saffiano Lux Galleria Resale Index: 43% of Retail Price

CULT BRANDS GAINING SHARE IN THE ONLINE SECTOR

GIVENCHY & LANVIN

TAKING STOCK OF

CULT BRANDS The parameters of luxury are changing. Brands with niche followings howfdh are sharing space with big names in the luxury portfolio

uxury has always been something of a paradox: exclusive to a selected few, while at the same time iconic enough for the masses to recognize and aspire towards. This explains the enduring appeal of luxury super brands à la Chanel, Hermès and Louis Vuitton.

Cult brands like Givenchy and Lanvin however, have enjoyed a surge in popularity based on latest sales data from Reebonz. Transactions have surged from hundreds to thousands in the span of a year, with bags driving the strongest demand amongst consumers. Cult brands are giving super brands a run for their money as consumers’ tastes shift. Traditional luxury may just be losing some of its sheen, as industry experts predict a subtle shift in consumers’ tastes towards more unique, personalised and niche pieces. Lawrence Lenihan, adjunct professor at NYU Stern School of Business and co-founder and co-CEO of Resonance, suggested that “by trying to mean something to more people, the luxury brand means less to anyone” in his recent presentation at the FACC Luxury Symposium 2016. Instead, Lawrence positioned that “Economies of Small” will rule tomorrow’s luxury industry, with value derived from speed, technology, data, deep knowledge and precise execution. All is not lost for luxury powerhouses though, as a 2015 study by Havas Media Group’s LuxHub showed that 64% of luxury consumers still prefer super brands to niche brands#. Echoing the consumer sentiment, Reebonz will continue to focus on the top 20 brands while devoting a smaller section of their online shelf space to cultivating niche brands and their fans.

Havas Media Group. (2015) LuxHub focus: Luxury super brands still dominate for luxury consumers, with 64% preferring them to niche luxury brands. Retrieved from http:// www.havasmedia.com/press/press-releases/2015/luxhub-focus-luxury-super-brands-still-dominate-for-luxury-consumers-with-64-precent-preferring-them-to-niche-luxurybrands

CULT BRANDS GAINING SHARE IN THE ONLINE SECTOR

GIVENCHY & LANVIN

TAKING STOCK OF

CULT BRANDS The parameters of luxury are changing. Brands with niche followings howfdh are sharing space with big names in the luxury portfolio

LUXURY, TOMORROW

Evolution of the LUXURY SHOPPING ECOSYSTEM

Digital has enticed shoppers online, while the role of the shopper has evolved too

igital, has undoubtedly had a major impact on the world of luxury shopping. In an age when experience is almost everything, the role of brands and retailers in shoppers’ consumption journey is no longer as straightforward as before.

The rise of the sharing economy has also created subtle shifts in the role of the consumer. Where consumers used to buy from brands or retailers, buyers have now turned into sellers as they realise the value in their closets. Here’s a look at how Reebonz’s luxury ecosystem has evolved today.

REEBONZ ONLINE

LUXURY ECOSYSTEM

LUXURY, TOMORROW

Evolution of the LUXURY SHOPPING ECOSYSTEM

Digital has enticed shoppers online, while the role of the shopper has evolved too

REEBONZ ONLINE

LUXURY ECOSYSTEM

CHARTING GROWTH Shoes and timepieces chart fastest growth amongst shoppers Shoes, bags and timepieces showed the biggest increase in total sales across Asia, with growth for Reebonz largely fueled by gains in the shoes sector. Luxury consumers in Singapore, Indonesia and Malaysia are starting to shop for shoes online, while Indonesian and Hong Kong shoppers are leaning towards small leather goods and timepieces respectively.

NAVIGATING THE NEW GRID OF

LUXURY SHOPPERS

Right: a breakdown of each product sector by their sales growth in five geographical markets, based on total sales on Reebonz in 2014 and 2015

Creating value is key for brands and retailers to draw luxury consumers

n a time when the digital revolution is causing tectonic shifts in the retail landscape, the rules of engagement concerning luxury shoppers are no longer as they once were. The traditional approach that brands and merchants have applied for decades to coax and convert luxury consumers needs reform – and quickly – as digitisation transforms shoppers’ consumption journey at nearly every touchpoint. So what is weighing on the minds of modern luxury shoppers? Consumers today are increasingly plugged into brands and products with technology opening up new streams of information discovery, and they are no longer as easily satisfied with the same old. Key

to navigating this brave new world is understanding the luxury consumer, what they are moving towards, and evolving retail strategies to keep shoppers engaged and loyal.

on Reebonz

56% 39%

Timepieces Small leather goods

20%

Jewellery

16%

Accessories

14%

Singapore Malaysia

Australia

Indonesia

Hong Kong

73% 70% 59% 84% 37%

Hong Kong

53% 34%

Malaysia Singapore

Bags

Online luxury shopping continues to grow in Asia, and shoppers in Australia and Indonesia are charting the biggest growth when it comes to buying high-end goods based on the latest data from Reebonz. Singapore remains firmly in first place for online shopping, with healthy sales gains from 2014 to 2015.

Indonesia

LUXURY SHOPPING

87%

Singapore leads online shopping, while Australia and Indonesia grow in market share

Australia

Change in

Shoes

48% 16% 32% Transactions

Left: a comparison of transactional and sales growth in five geographical markets, based on total sales on Reebonz in 2014 and 2015

Sales

NAVIGATING THE NEW GRID OF

LUXURY SHOPPERS

Right: a breakdown of each product sector by their sales growth in five geographical markets, based on total sales on Reebonz in 2014 and 2015

Creating value is key for brands and retailers to draw luxury consumers

to navigating this brave new world is understanding the luxury consumer, what they are moving towards, and evolving retail strategies to keep shoppers engaged and loyal.

on Reebonz

56% 39%

Timepieces Small leather goods

20%

Jewellery

16%

Accessories

14%

Singapore Malaysia

Australia

Indonesia

Hong Kong

73% 70% 59% 84% 37%

Hong Kong

53% 34%

Malaysia Singapore

Bags

Indonesia

LUXURY SHOPPING

87%

Singapore leads online shopping, while Australia and Indonesia grow in market share

Australia

Change in

Shoes

48% 16% 32% Transactions

Left: a comparison of transactional and sales growth in five geographical markets, based on total sales on Reebonz in 2014 and 2015

Sales

Key to winning online: creating value in luxury Being attuned to changing consumer tastes is only one part of the equation. Online shopping needs to be considered as a complete consumption journey – from product search and discovery to browsing, from placing an order to after-sales care and delivery.

THE FUTURE OF THE

Experience takes center stage, so the brands and retailers that are willing to cede some control of their image and have a conversation with consumers are the ones gaining share. Technology upgrades to enhance the shopping process will be essential, as well especially when targeting Millennials. Case in point, studies have shown that 32% of consumers will give up if a website takes too long to load, which can be anywhere between one and five seconds^. For Reebonz, keeping its status as the number one online luxury retailer in Southeast Asia will involve developing capabilities to align their offerings closely with the way consumers’ luxury consumption journey evolves. “Luxury consumers value a product experience that actually feels luxurious, even if shopping happens online,” said Samuel Lim, CEO of Reebonz. “At Reebonz, we approach luxury as a service where we’ve built in all the traditional elements you would expect from a high-end boutique. All pre-owned items are appraised and authenticated by our inhouse experts, pieces are shipped at no extra cost in one to three business days, virtual relationship managers handle any queries or issues, as well as White Glove, a service that takes care of everything for those looking to sell their pre-owned designer items.” Samuel said, “We’ve essentially created a luxury shopping ecosystem that addresses all the needs and wants of the modern luxury consumer.”

LUXURY STOCK EXCHANGE Reebonz’s founders deconstruct luxury shopping in the next decade

igital connectivity has leapt in recent years, and in turn, transformed the retail landscape. As consumers increasingly shift their attention online, online shopping has started to reach critical mass with e-commerce starting to catch up with brick-and-mortar stores. Eight in ten consumers now use a computer, smartphone, tablet, or in-store technology while shopping, according to survey results from MasterCard’s Omnishopper Project. Particularly noteworthy too, are findings from a recent study by The NPD Group and Wharton School’s Baker Retailing Center that revealed the younger the consumer, the more spending is done online. Demographics aside, the consumer shopping journey has undoubtedly evolved with digital technology having a huge hand in reshaping the way transactions are made. Internet penetration is currently at 36% in Asia Pacific, but perhaps more significantly, a staggering 92% is connected on mobile. Is that an indication of the direction the consumer shopping journey will take in future? Absolutely, says Daniel Lim, Chief Brand Officer at Reebonz.

^Weatherhead, R. (2014, February 28). Say it quick, say it well -- the attention span of a modern Internet consumer. The Guardian. Retrieved from http://www.theguardian.com/media-network/ media-network-blog/2012/mar/19/attention-span-internet-consumer

“The retail scene has undergone a dramatic shift as consumers’ shopping patterns change,” he says, “digital connectivity has been a major driving force. The way media is consumed and how product discovery happens all have a tangible impact on shoppers’ consumption journey, especially so for luxury consumers, hence our approach to adopt an omni-channel marketing strategy.” Here, the founders of Reebonz – Samuel Lim, Daniel Lim and Benjamin Han – reveal their take on the biggest trends in luxury shopping in the next decade.

TREND: Mobile Shopping “Current trends indicate smartphones are becoming increasingly important to the luxury consumer’s shopping journey. We see the shopping experience playing out largely on mobile in the next decade: a consumer will encounter a product ad on her social media feed, read online reviews on the piece by digital influencers she follows, and she’ll browse and make her purchase via her trusted e-tailer’s mobile app.” TREND: Virtual Personal Shopper “Shopping holds so much appeal because it is more than just a transaction. It is a journey of consumption and the actual act of payment is just one point in the entire path to purchase. For luxury consumers, they still want a luxury experience even when shopping online. Virtual personal shoppers or relationship managers will be key to delivering that bespoke touch.” TREND: Collaborative Shopping “Retailing will become more collaborative, with luxury shoppers buying not only from brands or retailers, but also from their peers. Sharing and exchanging personal pieces as a way to pull value from and liquidate their closets and at the same time, create space for new purchases.” TREND: VIP Rewards “Traditional loyalty schemes for top spenders will no longer be enough. The future will revolve around personalisation, digitisation and gamification when it comes to value-added perks to reward VIPs, such as VIP checkouts, early access to their favourite brands or sales, or interactive experiences to earn access to exclusive, secret events.”

THE FUTURE OF THE

LUXURY STOCK EXCHANGE Reebonz’s founders deconstruct luxury shopping in the next decade

TREND: No-Click Shopping “Luxury consumers will feel the most affinity with e-tailers who understand their shopping preferences and needs at a deeper level. Resources will go towards data collection and analysis to understand luxury consumers’ shopping patterns and preferences like how often they buy a new bag, their favourite brand or the occasions they shop for. They will then receive notifications about a new item or suggested pieces that they would appreciate along with no-click – or at-home replenishment – shopping options for orders to be placed and delivered straight to their doorstep.” •