On Wednesday, the company said it plans to invest $28 million in a leading Chinese flash sale website firm to spur existing luxurygoods sales online in China as well as build a new branded e-commerce business, which is scheduled to launch later this year.
Under terms of the agreement, Neiman Marcus Group said its non-controlling investment in Glamour Sales Holding would combine talents of both companies to create “a new team in China who will oversee the development, launch and management of the new website.”
Founded in 2009, the privately-held Glamour Sales Holdings operates the leading, authorized flash sales websites in Asia: Glamour-sales.com.cn in China and Glamour-sales.com in Japan.
Website to Premiere Last This Year
“We are taking this bold step to establish Neiman Marcus Group as an international brand,” said Karen Katz, president/ceo at Neiman Marcus Group. “Our strategic investment in Glamour Sales gives us a tremendous partner and a strong foothold in a rapidly expanding luxury market.”
Their jointly created, yet-unnamed website will feature “an expertly curated mix of full-price, current-season offerings to reflect the discerning taste of the Chinese luxury customer. The site will have editorial content, fashion expertise and behind-the-scenes videos to make it a reliable and indispensable source of valuable insights about featured luxury brands.”
“We believe that our vast experience and history of success in luxury and fashion, customer service and e-commerce, combined with Glamour Sales’ keen understanding of the Chinese market, presents us with a unique opportunity to build a vibrant full-price, multi-brand, luxury online business in China,” Katz added.
“This partnership represents the coming together of two pioneers. Neiman Marcus was the first luxury retailer to go online and Glamour Sales was the first to bring authorized flash sales to China,” said Olivier Chouvet, c0-founder and ceo at Glamour Sales. “Together we look forward to offering Chinese customers the best merchandise and service available. And we will provide our customers with the peace of mind that comes from knowing that all of our luxury goods are authorized, authentic and sourced directly from the manufacturer.”
While many European-based brands—from Louis Vuitton and Gucci to Zara and H&M—have expanded into China with stores and websites, more American brands are doing the same, including Gap Inc., American Eagle Outfitters, Forever 21, and Abercrombie & Fitch as well as Coach.
Retail analysts noted that Neiman Marcus’ investment is more like putting a toe into China, which is well on its way to becoming the largest luxurygoods market in the world. Most sales in luxurygoods in China happen at bricks and mortar locations. According to a report by Boston Consulting, only 3% of sales are made online in China, compared to 12% in the United States.