China Consumer

Reach for the stars

How brands are tapping into fandom to fuel sales


He’s a sales machine: Kris Wu

His face adjourns advertisements in China promoting goods from Beats and Bulgari through to more affordable brands like Xiaomi and McDonald’s. Chinese rapper Kris Wu Yifan’s star power is so strong (a topic we discussed back in issue 432) that he also helped boost Burberry out of a sales slump too. His capsule collection with the British luxury brand sold out instantly when it was launched back in December 2017 (for more on Burberry’s marketing strategies see story on page 9). And the “Kris Wu effect,” as some term it, persisted after he was named as Burberry’s brand ambassador. Revenues edged up 3% in the first quarter of 2018 compared with a year earlier after consistent double-digit declines in the previous quarters.

Burberry chief executive Marco Gobbetti admitted that the uptick was helped by a strong performance in China and the company has recognised how Wu helped reshape its brand image among Chinese millennials.

Last month it was the turn of Louis Vuitton to announced it had tapped Wu to endorse its brand, in what looked like another move to market more specifically to younger Chinese.

But Wu has decided to launch his own brand too, unveiling his personal jewellery line A.C.E at the end of last year.

The company sells its goods primarily through Alibaba’s Taobao, with a product range – 16 in total – consisting of earrings and necklaces. The most expensive is an 18 carat gold and gemstone-encrusted necklace with the A.C.E. logo that retails for Rmb52,000 (around $8,200).

The price tags weren’t enough to deter his diehard fans, mind you, as they rushed to snap up the goods at launch. A silver necklace set with quartz, which costs Rmb19,800, sold out within an hour. By the end of the store’s first day of business all the stock had been sold.

“The value of cubic zirconia [another type of gemstone in Wu’s jewellery line] is similar to a glass ball. Quartz is also worthless,” one mystified jewellery expert told 36kr.

But his fans don’t seem to care about the quality or the value for money. “Let’s be honest, people are buying for Wu Yifan’s halo,” another industry insider pointed out.

China’s ‘fan economy’ can prove lucrative for the stars and celebrities – anchored as it is by highly organised clubs of hundreds of thousands of devotees, as well as millions more admirers on social media.

Others warn about the longevity of celebrity-owned brands, saying that they struggle to appeal beyond their core fanbases.

“The halo of a celebrity is sometimes a double-edged sword. Most of the brands are limited to just their fans, who buy the products to support their idols and not because they like the products. The number of these diehard fans, however, is limited. Take A.C.E. Even though the sales volume seems high for a brand that was just launched, its fan conversion rate is not high: Wu Yifan has 45 million followers on weibo but A.C.E. only has 58,000 followers on the same platform,” calculated Chief Entertainment Officer, a blog.

“The early stage of the launch is impressive, thanks to the help of the fans, but the majority of Wu’s fans are young women. They will do anything to support him,” said 36kr, which predicted that Wu’s jewellery business will remain niche rather than go mainstream.

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