One of the world’s largest luggage makers Samsonite International SA is banking on e-commerce to fuel its China business, which is set to record 12 to 14 percent growth in the coming years.
The company hopes to have one-third of its sales generated online by 2022 against 20 percent in 2016, said chief executive officer Ramesh Tainwala.
With the explosion of online shopping and a wealthier population eager to travel, China may overtake the United States as its largest market in the short run, with sales likely to double in three to five years, Tainwala said at a media briefing in Shanghai.
He said: “At the beginning of the e-commerce, the Chinese were buying online because it was cheaper. But now consumers are maturing, it’s all about convenience.”
China is the world’s largest online retail market, with 36 percent of the population shopping online at least once a week, far outstripping peer buyers, according to a study by the International Post Corporation, a Brussels-based group that provides business-critical intelligence to its members who are part of the postal industry.
To harness that growth, Samsonite has launched a “three-pillar” strategy for digital retail. One is to team up with Chinese business-to-customer sites like Tmall and JD. According to Tainwala, the two platforms combined claim 60 percent of Samsonite’s online sales. Another channel is the digital stores of shopping malls and department stores.
The third step Samsonite is taking this year is to open its indigenous direct online shopping portal, attracting sophisticated buyers who wish to purchase bigger-ticket items via the brand rather than a third party.
It has also utilized social media to guide traffic to brick-and-mortar stores. For instance, followers of Samsonite’s official WeChat account can sign up for a promotion event in a shopping center and get a discount coupon. Online marketing has helped woo customers and add another 5 percent of their offline sales, according to Frank Ma, a senior Samsonite executive.
Seven of Samsonite’s nine brands have been introduced to China, ranging from entry-level American Tourister, namesake and contemporary luxury Samsonite, to the newly acquired Tumi, which targets up-market business travelers.
The multi-brand approach has made online a critical battlefield to win buyers, especially those in lower-tier cities who have fewer opportunities to access physical stores and are taking outbound trips for the first time.
Ma said: “Globalization has made travelling a lot easier. With simplified visa procedures, we see more first-time travelers from China going beyond borders. To this end, we have designed products tailored to their needs.”
For instance, American Tourister and Kamiliant are the two affordable brands for these first-time travelers. A typical 20-inch Kamiliant case sells from 199 yuan ($28.9) on Tmall.
Meanwhile, it has added new features to its most iconic business assortment, including a new hero backpack with three volumes, two check-in-sized spinners, and a brand-new spinner rolling tote.