Tag Heuer enters cooperation with Alibaba and sells watches online in China

As Switzerland reported over the weekend, the western Swiss watch brand is breaking new ground in China. Manager Jean-Claude Biver, head of watches at French Tag Heuer parent LVMH Moët Hennessy Louis Vuitton, has partnered with online department store Tmall, part of the Alibaba Group.

The watch brand has so far generated only three percent of its sales in China. Thanks to the Tmall cooperation, this figure is set to rise to ten percent in the next three to five years, according to Biver.

LVMH, the global leader in the luxury goods industry, is also testing this online strategy for other of the more than 70 brands belonging to the group. LVMH cosmetics brands For Ever, Guerlain and Sephora are already present on Tmall.

Tag Heuer already sponsors the national soccer league in China and cooperates with the space agency.

Luxury industry shies away from online

Although Tag Heuer already sells watches via third-party portals, the cooperation is special in the luxury industry. In many cases, the opinion still prevails that premium advice and styled showrooms belong to expensive prestige objects, according to a report in Switzerland over the weekend. Tag Heuer is the first Swiss watch brand to cooperate with the Chinese Internet giant Alibaba.

Jean-Philippe Bertschy, an analyst at Bank Vontobel, believes that this step is the right one. After all, the trend in the luxury sector is also moving in the direction of online - even if many brands had until recently greatly expanded their branch networks. Bertschy questions whether this is "only the right strategy in the medium term". Especially in China, where customers are different and adapt more quickly to new technologies.

Agreement against counterfeiting

Chinese online portals have been a thorn in the side of Swiss watch manufacturers. This is because they are full of fakes, some of them amazingly authentic, which are offered at a fraction of the price of the expensive Swiss originals. With Tag Heuer, a Swiss watch brand is now actively entering this "battlefield" for the first time - and determining the "rules of the game" at the same time. According to a Tag Heuer spokeswoman, Tmall has undertaken not to sell any counterfeits of the watch brand. Details about the agreement are not disclosed.

Swiss brands such as Victorinox go to great lengths to monitor Chinese platforms and have offending offers deleted. The figure is said to be around 1,000 per month. The Swiss Watch Brands Association also had 1.3 million offers deleted from various online platforms in 2016. (hae)