In November 2018, Dolce & Gabbana released the promotional film “Eating with Chopsticks“, which was considered a major miss in representing Chinese culture, leaving many viewers feeling disrespected and mocked. The video was of a Chinese girl awkwardly using chopsticks to taste “super-size” Italian dishes. Whether it is the arrogant “Chinese pronunciation” in the film, the model’s strange posture when dining, or the hidden ambiguity of the narration, there are all too many suspects of discrimination against Chinese culture. After being questioned, Stefano Gabbana, one of the founders of the brand, called the Chinese “arrogant” and “stupid” in his personal conversation on Instagram. This promotional video and the founder’s follow up reaction caused the loss of reputation of Dolce & Gabbana in China.
How the provocative video costed the reputation of Dolce & Gabbana in China
The promotional video was followed by uproar on Chinese social media. After several months of preparation, the fashion show that should happen in Shanghai that day was cancelled, and more than a dozen celebrities announced their termination of the contract. Tmall, JD.com and other e-commerce platforms collectively removed Dolce & Gabbana products. In almost a day, Dolce & Gabbana’s online sales channels in China collapsed. In addition to the slowdown in store openings, Dolce & Gabbana had to close some stores. For example, the Chinese flagship store on Nanjing East Road in Shanghai closed in February 2019, and the flagship store of Beijing Yintai Center officially closed in April 2020. Even more recently, Dolce & Gabbana store in Chengdu have been closed and LVMH Group and brand Fendi took the vacant place.
How Dolce & Gabbana in China lost revenue
Since the incident, Dolce & Gabbana sales experienced sharp decline, and even the world’s largest luxury e-commerce company YNAP removed D&G from the shelves during Black Friday. According to the 2019 financial report, D&G’s revenue share in the Asia-Pacific market, including China, has shrunk from 25% in the previous year to 22%. Because of the loss of the Chinese market, the value of the two owners of D&G shrank by 30% and they both fell out of the list of billionaires. Since the incident with one of the D&G CEOs, the company’s business in China lost over one billion USD within 24 hours, followed by D&G’s sales in China in a continuous fall.
Because of the failure in the Chinese market, the stock price was also greatly affected. Just 8 days after the incident broke out, Dolce & Gabbana’s losses; number has reached 37.6 billion yuan.
Dolce & Gabbana tries to reenter the Chinese market
After Dolce & Gabbana’s sharp sales decline, delay of fashion shows, and the brand’s removal from the shelves of domestic e-commerce platforms, Dolce & Gabbana has begun to covet the Chinese market again.
Milan fashion show with Chinese painting style
In 2018, Dolce & Gabbana held a fashion show for the autumn and winter collections in Milan. This time, they tried to express their friendliness to Chinese consumers again with a design close to Chinese culture. On the day of the catwalk, one section focused on the Chinese painting style. Besides, models wore embroidered costumes in the style of Qing palace operas.
Christmas with Chinese elements
Christmas is a traditional sales season. One month after the provocative video, Dolce & Gabbana wanted to recover lost ground with Christmas sales. They released a Christmas advertisement with strong Chinese elements. For example, they created the red peony flowers on the bag. The stores were also decorated with bright red carpets.
Year of the Pig t-shirts of Dolce & Gabbana in China
In early 2019, Dolce & Gabbana launched a series of T-shirts for the Year of the Pig in order to show its favor to the Chinese market. However, it wasn’t successful, as people kept discussing the words of D&G CEO about China.
Targeting Qixi Festival
On August 7th, 2019 Dolce & Gabbana’s official WeChat account posted a Qixi festival promotion after 9 months of silence. The brand posted an animated picture with no commercial elements, written “love” and “Happy Qixi Festival” in various languages. This cautious animated picture, with less than 20,000 views, was submerged in the endless hotspots that day. Below the picture, the comments were closed.
In addition to publishing content and buying high-priced open-screen advertisements on a blog, they also advertised on the fashion magazine “ELLE” account. Although the Dolce & Gabbana brand name does not appear in the full text, the article is still connected to the “D&G Online Sales Platform” at the end of the article.
At the end of October 2019, Dolce & Gabbana appointed Carlo Gariglio as CEO of the Asia-Pacific region. Some analysts believe that the brand’s move is to restart business in the Chinese market.
Dolce & Gabbana in China launched virtual idols
Moreover, Dolce & Gabbana launched two female virtual idols Liz and Sam, and these two virtual influencers sport Dolce & Gabbana’s Qixi limited series outfits. There are two main drivers for Dolce & Gabbana to use virtual idols in China. In recent years, the virtual KOLs has indeed become very popular. In addition to the popularity of this virtual idol, another, perhaps more notable reason is that Dolce & Gabbana simply can’t find a brand image spokesperson in China, which serves as a message of the fashion house’s continued struggle since 2018.
What other luxury brands can learn from Dolce & Gabbana in China
- First, overseas brands need to work harder to get to know consumers in China. In addition, it is necessary to monitor trends in consumer behavior on an ongoing basis. It is not enough to rely on classical market research; it is necessary to analyze what people write on social media. This would help Dolce and Gabbana respond quickly to negative comments from users on Chinese social networks.
- Second, companies must have a cultural sensitivity in order to successfully implement a localization strategy. It is important to abandon stereotypes and think more broadly, trying to be careful about other people’s cultural characteristics.
- Third, luxury goods companies need to focus not only on the products, but also on the equity of the brand itself.