5 Questions with: Richard Li, Founder & CEO of Secoo, China’s Leading Premium E-Commerce & Lifestyle Platform

Last month, Secoo held a brand upgrade press conference, to announce their new slogan – ‘Devoted to You’ and to introduce the brand’s expansion plans. Already the leading premium lifestyle platform with over 25% market share, these bold new plans centred on customisation – unique collaborations with Chinese designers and talents, personalisation – high-end travel and personalised education packages, rental – a seven-day luxury bags and watches service, as well as partnerships and co-branding aimed at diversifying Secoo into new products and offline, social experiences.

The Luxury Conversation previously gathered insights from the CEO of Secoo Luxe, Eric Chan, at the China Luxury Committee in Shanghai.

This week, we spoke to the Founder & CEO of Secoo, Richard Rixue Li, to gain his insights.

With the rise of e-commerce in China, what are the challenges for luxury brands when adapting to a new method of sales and marketing?

Simply put, China’s e-commerce offers more channels for increasing brand awareness. It’s understandable that some luxury brands may be worried that they lack control over the digital world and being on any ‘mass’ platform may dilute their positioning, but this is why, with Secoo for example, we consistently and only angle the platform as premium lifestyle, maintaining the same level of branding and target consumer. So our goals are fully aligned with a luxury brand in this way.

Secondly, e-commerce is a must in China – not as the sole method, of course, but the access that your consumers need, all over this vast country. Consumers in China are incredibly fragmented, and the right e-commerce platform is one that makes the consumer’s experience seamless and time-saving. You have to be accessible, which is the clear advantage of having an online point of sales, branding and contact.

We are seeing that the growth of luxury brands’ offline sales are slowing – this does not mean that offline retail as a whole is slowing, as having the physical presence is also key. But the actual check-out or sales point is moving online.

What is your advice/guidance for luxury brands considering moving more to e-commerce, if they are concerned that this may dilute their brand or not be sufficiently ‘luxury’?

At the beginning, brands might have refused to move to e-commerce. But for luxury brands, consumers are using e-commerce platform more frequently than before, which is now their habit to do so. At this moment, brands need to change their minds and recognise the value of e-commerce.

For us, Secoo has spent 10 years to accumulate 18 million high-end consumers and 1,500 luxury brand partnerships. Brands collaborate with Secoo not only for the e-commerce platform, but critically, they also need our consumer resources and our data. So Secoo is transforming to a premium lifestyle platform — luxury products are not the only selections available, consumers can also find other services to fulfill their lifestyle.

How have you positioned Secoo as unique versus the other platforms, as the superior option for both brands and also consumers/shoppers?

If you look at the question simply, then it might seem as though JD.com and Tmall are our competitors. But this is actually not the case. Secoo is a premium lifestyle platform, and luxury fashion, cosmetics and other product sales are indeed a key part of our business, but not entirely.

We also provide valuable services and relevant products to our consumers, including customised travel, personalised education, and overseas medical examination services. This diversifies the offers, while maintaining a premium level, as well as giving our users much more than purely a purchasing channel.

While brands who still haven’t entered China ‘fully’ do see the opportunity, they are usually concerned about the potential pitfalls of moving into the Chinese marketplace, as it is unique and unlike other markets globally. What advice would you give these brands on the ‘right’ way to find their success in China?

The most common case of failure – or lack of strong success – in China is when an international brand uses a global strategy. It won’t work in China! You cannot expect to employ a general strategy in a country as large and diverse – and ever-changing – as China.

You need to take the time to fully understand the marketplace, to know all of your local competitors and so on. You need to have key staff within the country and to have trusted local experts.

Secoo seems to be expanding into physical retail. Do you have strong plans to mix online-offline commerce this year?

We have offline Experience Centers in eight domestic cities and an international one in Malaysia. Through these Secoo Experience Centers, we are emphasising the nature of premium lifestyle, as physical venues are essential for the consumers’ experience. The offline experience is also an opportunity to build trust for our customers.

Our offline experience stores are essentially social places. Consumers can communicate and interact with us, which makes the relationship personal. We do sell at the venues, while this is not their purpose. In the future we will open more physical stores in China and beyond. We plan to open in the U.S., Europe and Japan in 3-5 years.

Our aim is to let consumers know and understand Secoo, and to personally experience excellent service. There are many channels and options in China for the affluent consumer – buying a single product is very easy, but the feeling of quality and personalisation can be difficult to find. This is what we aim to deliver.

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