【South Korea】Luxury Brands Pour Efforts into Influencer Marketing

Gucci accounts for 50% of Kering’s revenue and two-thirds of its operating profitability.
The luxury industry is increasingly relying on influencer marketing to communicate with discerning and ever-changing consumers for growth. A recent report by data analytics firm Luxurynsight’s LY Watch and influencer campaign management platform Trackr details how luxury brands strategically targeted the Chinese market in 2023. It also highlights their growing use of partnerships within the sports sphere, expanding their reach across various activities and influencers.

The study analyzed 5,926 activities conducted globally in 2023 by 58 major luxury brands, including Chanel, Dior, Balenciaga, and Prada, covering various sectors such as fashion and high-end products (ready-to-wear & leather goods, perfumes & cosmetics, watches & jewelry). These activations included diverse initiatives like product launches, communication campaigns, and in-store events.
Following the lockdown period due to the COVID-19 pandemic, China’s reopening in early 2023 significantly impacted the industry as more Chinese consumers purchased high-end products locally. The report notes that total retail activations surged by 45% in 2023, prompting luxury brands to invest in experiential retail to strengthen their local presence and meet evolving customer expectations, though it specifies this trend slowed in the second half.
Notably, despite the momentum slowing in the second half, brands continued investing in exclusive projects tailored for the Chinese market, particularly in the perfumes & cosmetics sector. Limited-edition product launches were a priority, accounting for 59% in ready-to-wear & leather goods, 89% in beauty products, and 57% in watches & jewelry. Pop-up stores remained a popular retail format, representing 54% in ready-to-wear & leather goods and 82% in the beauty sector.

Collaborations between athletes and luxury houses have also emerged as a highly effective strategy. The report explains, “Luxury brands were able to enhance brand awareness through the global influence, authenticity, and appeal of athletes across all age groups.”

Tennis player Emma Raducanu has helped Dior expand its customer base.
Recent examples of collaborations between athletes and luxury brands are numerous, especially with the LVMH group acting as a premium partner in preparation for the 2024 Paris Olympics. Brands like Louis Vuitton, TAG Heuer, and Dior have partnered with athletes, including British tennis champion Emma Raducanu. As the model for Dior’s newly launched Lady 95.22 bag, Emma Raducanu mentioned Dior on her Instagram account throughout the year, driving over 1.1 million engagements through posts and in-feed stories during 2023 and the first six weeks of 2024.

The study also highlighted particularly vibrant activity centered around the ski world. The report states, “In 2023, luxury brands engaged in fierce competition to attract ski-wear customers, with many opening strategic pop-ups in key cities and running targeted campaigns, representing a 50% increase compared to the previous year.”

This phenomenon aligns with diversification strategies that extend into influencer marketing through initiatives in various fields or new influencer profiles, beyond just fashion and commerce. Notably, 2023 saw a sharp increase (+229%) in the opening of restaurants and cafes to provide immersive experiences, foster brand engagement, and attract more customers.
Prada’s temporary cafe located in the UK’s Harrods department store became a highly popular tourist attraction last year.
The report emphasizes, “There is a growing trend of luxury brands venturing into the foodservice industry by converting struggling boutiques or commercial spaces into cafes or restaurants. This strategic shift allows them to reinforce their identity as lifestyle brands and capitalize on the growing trend of experiential consumption. By offering food and beverage services, luxury brands aim to create multi-purpose destinations that enhance customer loyalty and promote local engagement by providing a holistic brand experience to customers in the short and medium term.”
A recent success story is the Prada Caffè located in London’s famous Harrods department store, which proved to be a highly popular hotspot. With 471 influencers mentioning the cafe across 955 social media posts, this content garnered over 1.5 million engagements and 25 million video views. TikTok emerged as the platform driving the most engagement.
Furthermore, luxury brands are diversifying their talent and influencer discovery. For instance, they are appointing celebrities or superstars to creative director roles, such as American singer Pharrell Williams as the men’s wear collection director for Louis Vuitton. The goal is to redefine the brand’s narrative and appeal to a more contemporary customer base. Conversely, within the influencer sphere, it’s not mega-celebrities but influencers with mid-level recognition who are garnering the most attention.