Tommy Hilfiger stages strategic Shanghai show
After North America and Europe, China was the next stop for Tommy Hilfiger’s itinerant ‘Tommy Now’ show. With Formula 1 world champion Lewis Hamilton as brand ambassador, the fifth session of the US label’s ‘see now, by now’ show was held in Shanghai on September 4. Ahead of the event, Tommy Hilfiger has also introduced the first items of the ‘Tommy x Lewis’ capsule collection, inspired by the British F1 driver.
China is a crucial strategic focus for the PVH group’s label, clearly very keen on expanding in the country. According to estimates contained in a study by Euromonitor, sportswear sales in China are booming, and are expected to exceed sales of luxury goods by 2020. Tommy Hilfiger is positioned at the intersection of sportswear and luxury, and reckons it has a huge potential.
In April 2016, the label took complete control of the joint-venture company which had been running its business in China since 2010. The acquisition, worth an investment of $172 million for the remaining 55% stake in TH China, was regarded then as a “significant milestone” for Tommy Hilfiger, according to Emanuel Chirico, CEO of the PVH group.
At the time, Tommy Hilfiger operated 350 stores in China, of which 65 were directly owned. However, Daniel Grieder, the General Manager of Tommy Hilfiger, pointed out at the time: “We are eager to deploy a fully integrated strategy in China, enabling us to tap the region’s strong dynamic. This will allow us to exploit growth opportunities more effectively, by offering a broader range of Tommy Hilfiger products and showcasing the brand in a more accomplished fashion. We will boost growth by energising our marketing operations in China. We plan to invest even further, driving the brand’s expansion through new store openings - both directly-operated and franchised ones - and improving the productivity of existing stores, while also expanding our traditional and digital marketing initiatives.”
The acquisition has been metabolised by now, and the group is ready to step up its pace in the market. In 2015, Tommy Hilfiger’s business in China was estimated to be worth around $250 million. During the 2017 financial year, Tommy Hilfiger’s overseas revenue topped the $2 billion mark, growing 9% at constant exchange rates. In the third quarter, the increase was as much as 20%, and the group underlined China’s contribution to this result.
“As we continue to expand the brand’s footprint, investing in our organisation and exploiting a growing number of stores in first and second-tier cities directly, I’m delighted to observe that our visibility on the [Chinese] market is increasing, thanks to our localised initiatives,” said Emanuel Chirico in his latest quarterly conversation with financial analysts. “We notice that both the brand’s reputation and the willingness to buy continue to improve,” he added. Buoyed by this positive trend, Chirico recently revealed that he is envisaging taking direct control of other Asian markets, like Hong Kong, Macao and some neighbouring countries.
The September 4 show was designed to boost this strategy, being conceived to resonate globally, but especially in South East Asia. Besides Lewis Hamilton and US celebrities Winnie Harlow and Hailey Baldwin, Tommy Hilfiger has also enlisted Chinese actress Maggie Jiang, 31, as one of the faces of the ‘Tommy Icons’ capsule collection. With Maggie Jiang and Shawn Yue, recruited last year, Tommy Hilfiger is now represented by a glamorous Chinese movie-star duo on the huge Asian market, and is in an ideal position to fully exploit the Shanghai show and the ‘Tommy Now’ concept.
Tommy Hilfiger is also already present on T-Mall and JD.com. “With every season, we continue to broaden the range we offer on these sites,” said Emanuel Chirico. “They are our leading online distribution channels. And e-commerce is increasingly a feature of our business in Asia and China,” he added. In parallel with the September 4 show, the US label has teamed up with T-Mall, a go-to site for Chinese e-tail, staging a series of initiatives with the website, where its products are now available.
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