Q1 2025 reinforced a critical reality for luxury brands in China: consumer confidence remains fragile, and growth is increasingly selective. Brands can no longer rely on legacy equity or generic playbooks—performance now hinges on precision, agility, and deep local relevance.
Ecommerce remained under pressure, while social platforms continued to evolve. RedNote has emerged as the key channel for brand visibility, driven by rising investment in content—even as user-generated activity on the platform shows potential signs of fatigue. Meanwhile, consumer-driven activity on Douyin and Weibo accelerated—driven by celebrity moments—further blurring the line between influence and noise. Navigating this shifting landscape requires sharper platform strategies and a more adaptive content approach.
Regarding the turbulence, in the COMPASS Index Q1 report, we still witness the unwavering efforts of luxury brands continuing to invest in the Chinese market, especially capitalising on the biggest local milestone—Lunar New Year. Lunar New Year is a perfect season for exposure, from brand events to national galas. Brands that capitalised on these activations were able to reap the rewards.
Fashion and Leather Goods:
From an eCommerce perspective, Ready-to-wear is the only category that secured positive growth in this volatile landscape. It remains the largest category on Tmall. While bags are one of the most desired categories on social media, their revenue still shrank in this quarter by double digits, but the decline weakened compared to the previous quarter.
Which brands are notable?
Loewe climbed to 8th place on the marketing index, mostly due to the well-discussed social posts, including its brand ambassador Yibo Wang. Coupled with its grand store opening in Shanghai, thebrand became the talk of the town. Versace rose steadily to 9th, driven by the hype surrounding its spokesperson lineup, including Cai Xukun, Minghao Hou, and Lusi Zhao.
Ralph Lauren rose to 2nd place in the eCommerce index, showing that the preppy trend still remains strong in this market. After a few successful seasons, the brand has further committed to this market by presenting its replica show in Shanghai in early April. Coach, benefiting from its impressive brand rejuvenation, climbed to 9th.
After a successful Q4, Moncler became one of the biggest fallers, dropping from 7th to 33rd. Marni and MCM also saw double-digit declines.
Watches and Jewellery:
Tmall revenue for watches saw a sharp drop (-32%), while jewellery remained more resilient, dropping only by single digits. On social media, jewellery’s momentum also dominated. This quarter,Bulgari claimed the top spot on the Marketing Index, followed closely by Tiffany & Co.
Qeelin, the Kering-owned brand with a strong Chinese touch, fully leveraged the New Year festival. By collaborating with a slew of celebrities on CMG New Year’s Gala, the brand gained tons of exposure on social media, rising to 8th place. Hublot, on the other hand, chose to tap into its sporty DNA by partnering with Chinese speed skating athletes, boosting its social media performance.
On Tmall, Cartier and Van Cleef & Arpels continued to secure the top 2 spots, while Bulgari made it into the top 3 thanks to the successful launch of new Serpenti Viper variations in December,which saw a huge rise in demand around the festival.
In the meantime, Montblanc, Breitling, and Jaeger-LeCoultre saw a decline in our eCommerce Index compared to Q4 2024.
