• Kate Chang

UPDATE #2

SELECTIONS


Thank you for visiting our website.


Recently, many brands and designers have inquired as to why we are selecting a large number of brands, and what our selection criteria is.


We do not have time to always individually answer each query, and so, on our website here, we would like to make an explanation on this point, such that in the future we may not answer all queries one at a time.


I want to explain that we indeed need to select a lot of brands. The reason for this, is that in China, there are various stages of development in the country and overall region, and it is not a homogeneous society.


China has 56 different ethnic minorities, they speak different languages, there are different religions and of course, economic situations; it is a very broad ranging market with a lot of variation. And given the stratification of the China market, there are different levels of customers to be served, given the still uneven development of the country today, they have different needs and preferences. There are Tier 1, Tier 2, and even Tier 3 cities, so the price, and aesthetic, has a wide range to cover.


So the brands that we select should be diverse enough to match the various taste and preference of this market.


At the same time, the culture of the surrounding Far East regions, is also not all the same. Their point of view toward fashion is not the same.


So when it comes to selecting a larger number of brands, and designers, the consumers will then have a lot of choices to select from.


In addition - the larger numbers help each other in many ways: more people means more bargaining power, with suppliers, with factories, with influencers. We can get better prices to support each of our designers, in each different category that they work in.


We can reduce costs, and we can then support each brand for longer, to go further.


So overall, this will give us a competitive advantage as well - not just to have unique designs, but even on the cost, we will be able to compete.


In addition, even the most talented brand, cannot stand alone in China.


We feel, that it is like in a garden, even the most beautiful flower will go unnoticed, unless it has the backdrop of the full garden to enhance its beauty.


At the same time, there can be internal competition and because there is internal competition it will cause everyone to work harder and be better, win more collectively, in the market.


Regarding our selection criteria, we are focused on uniqueness, personality and offering something that feels very representative, of the culture, or the geography, of where each brand is based, and where each brand is from. For instance, some brands based in Sicily, the designs truly reflect that influence, and others are from the south of France, for instance, and Milan and Rome, and each of their brands has some representative characteristic of their hometown.


The reason this is important, is that in China, the people respect and they truly love Western culture, and the younger generation in particular, want to go and experience the fashion and specific culture of each of the different regions. In order to show the unique aspects of their own personality and individuality, these consumers are seeking out these experiences, and this trend is taking hold very quickly; they have even traveled to Europe when possible, to have a more immersive experience, and understand the European culture from various angles - from food, to entertainment, to fashion. They then bring this feeling with them back home to China, keeping with them the fondness and curiosity toward the places they had visited.


For instance, they will take extra note of the local delicacies, and specialties, whether it's a particular type of red wine, or honey, or another kind of local product that is really unique and indicative of that particular region.


Our project is centered on this feeling, and as a result, we are looking for those smaller brands that can satisfy the desire of these consumers to show their own status and personality to the world, and that is not just through their money, but through their taste, through their many travels and understanding of Europe.


At the same time, we believe that we are at an inflection point in the fashion industry - everywhere in the world, the changes taking place now in fashion are impossible to ignore.


Mckinsey & Company has published research, showing that 2019 is a turning point in the “history” of China's fashion apparel industry. Their research has stated that China will replace the US as the largest single market in the world's apparel industry in and from 2019. In fact, China has gradually become one of the market leaders in initiating global trends in world fashion. This is evidenced by the attitude of many important brands. For example, Ermenegildo Zegna, the iconic Italian menswear brand, said that when the company wants to feel the pulse of luxury shoppers, New York is no longer a place to try new products. Instead, they have said, “Now we are testing new things in China, and if it works, we bring them all over the world”. That amount of attention paid, in and of itself, is something that would have been unheard of just a decade ago.


Although China's fashion market is huge, its distribution patterns are quite scattered and fragmented because the development of the market between the Tier 1, Tier 2 and Tier 3 cities is different in their paces and demands. However, it is useful to look back at its development in the past forty years, because we can see the evolution of this market more clearly, and really grasp the momentous opportunity we have here; we can feel what we are really on the cusp of.


The pursuit of fashion by Chinese consumers is no different from that of other consumers in the world on a basic level. However, what is defined as "fashionable", is always affected, often deeply, by the social-economic progress, and status, and the political and economic development of a country, and also how its interactions with foreign countries, has impacted the way a nation's people view themselves, in the world.


As an example, Belle International and Daphne International, two locally born Chinese brands, they were the earliest emerging brands in China, and they were the leaders of Chinese fashion in the 2000's.


They at one point had 5,000 boutiques and Chinese consumers wore them for more than a decade. There was a time when their very simple plaid shirt and down jacket, and basic line of women's footwear, was considered the most "fashionable" items.


However, with the rapid rise of fast fashion after the entry of Zara and H&M into China in 2007, Belle International and Daphne International began to feel old and tired. Their unchanging brand styles for more than a decade have reduced their market share in the region significantly, and, as a result, they have had to close hundreds of stores from 2015.


The rise of fast fashion really happened in China after the 2008 Olympic Games; with a further opening up of the country, the younger generation began to adopt a new fashion concept which included a lot or variety and always on-trend; but their focus was not excessively on the quality of the clothing. Fast fashion, for the first time, brought the runways of Paris, Milan and New York closer to the young consumer in Beijing. Whatever new styles had been displayed on those runways, would quickly arrive to young consumers, and in just 2-3 weeks after the shows, satisfying their thirst for the newest fashion trends.


However, the rising tide of the fast fashion chased by young Chinese consumers has finally started to ebb. Since these fast fashion companies were pushed to the forefront of the market in 2016, their dominance has begun to decline gradually. The announcements by Topshop and Forever 21 in 2018 and 2019 respectively, to turn off their lights and withdraw from the Chinese market entirely, were well-observed examples. The Chinese consumers have gradually realized that fast fashion is no longer sufficient in satisfying their needs. Beyond the trend, there lacks quality. Aside from the poor quality, fast fashion lacks personality and uniqueness, these are other aspects of fashion that make it an important part of our consumption as customers.


For instance, when a young mother who participates in her child’s mother-teacher conference, happens to find that her outfit is the same as another child’s mother, or when an office employee finds that the stitches of her zipper have come loose, after joining her colleagues for an after-work gathering, all these occurrences would make these middle-class consumers frustrated, and feel ashamed that their image, and by extension, their self-confidence, have been compromised simply because of the clothes they choose to wear. They do not want this kind of thing to happen when they upgrade their tastes in the pursuits of their own fashion style. As a result, fast fashion has gradually faded and skidded away from their minds. What they want is a kind of fashion that reflects their personality. It has a good cost/quality ratio, that they can also afford. They don't need to worry about wearing the same clothing, or their zippers coming undone. They want to feel free and comfortable. They want to wear something that can fully reflect their own personality and fashion point of view. At the same time, they will not blindly pursue high-end luxury goods that they cannot afford, because Chinese society has gradually evolved into an atmosphere in which excessively showing off luxury goods that do not match their own wealth, or even personal style, will not make their identities seem more elevated, but rather, it will only turn them into “nouveau riche” in the eyes of their peers.


Facing the rise of the Chinese fashion market of more than 400 million, in fact close to 500 million middle-class consumers, it is our mission, as well as our challenge, to correctly position our brands, closely follow and grasp the market pulse for those consumer groups that are gradually starting to crave that individualistic, personal experience with their fashion.


In response to this trend, we hope to propose a different solution in the mid-end fashion market where Chinese consumers expect personalization, quality, and uniqueness, as well as a reasonable price vs. quality; by providing the original and unique design point of view of hundreds of unique European design brands.


So again, even though fast fashion, and high luxury, they both still have a lot of fans in China, and while they will not disappear, people are starting to tire of these two options. They bounce back and forth between these standardized offerings, making an almost helpless choice, since there are no other alternatives.


Once again, it is against this kind of backdrop, that we aim to provide another potentiality for the customer, a myriad of choices, so that they may freely enjoy the fashion from each of these various regions, as a Chinese saying goes, it is “letting a hundred flowers blossom”, and among those blossoms, there will inevitably be that one that stands out to each of these newly discerning consumers.


Facing this vast market in the East, we feel that this approach is a new innovation, and as part of this movement we need to gather the strength of many, many designers, who have the talent and vision, and want to create their own brand.


At present, we are still actively seeking new brand partners, but because there has been some overlap in those brands already selected, and some of the incoming inquiries, we have had to say "no" to many people. In each kind of similar aesthetic, we may bring on 7 or 8 brands that overlap in some way, we hope, that with some internal competition, each brand will work doubly hard, and they will strive to be winners, pushing each other to be better. But if we end up with dozens of the same type of brand, then we will have to refuse some of them. This is our reasoning, and response to some of the questions that have been continually asked, that is, to understand how many brands we will select, and what our criteria is.


In another three to five years time, once our project has launched and is up and running, we will once again open our doors, to those people with a fashion point of view that represents a unique perspective. We will see which types of aesthetics have a strong demand, and if we do not have enough representative brands, then we will add more to make up for it at that time; and we will also open up to the new design points of view that are popping up, and we will absorb them into our platform as well.


At that time, we believe the fashion world will also have begun to change, and there will be innovations and points of view; and we will absorb more of these creatives into our project, and those brands with the ability to direct and lead with their taste and point of view, at that moment, they will be able to shine as well. Our demand does not lie in just pure numbers - but rather in gathering the quantity that we feel can represent and also satisfy the diverse tastes of the consumers in each distinct part of China, and also the surrounding Far East region. So our mission, and also our goal, is to catapult as many of these highly unique designers and brands, into our market.


We hope that this serves as an explanation, and in the future, we will not continue to explain on these points, in the interest of time and efficiency. We hope also for the communication and understanding of our potential partners as well.


Thanks for your time and attention.


Kate Chang

CEO

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