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RED App Rides Social Wave, Condé Nast Partners with Farfetch

The marriage between content and commerce has been a tricky union to forge for most companies, especially when it comes to luxury properties and social media. The Wild West nature of the format has traditionally been seen by a lot of upscale brands as too dangerous a territory to navigate. But as e-commerce matures, digital natives come of age and traditional avenues for sales and advertising lose traction, retailers and brands at every tier are looking to content—including user-generated content—to drive engagement.

Luxury shoppers in China are currently demonstrating how effective this method of selling can be. The RED app, a go-to in China for foreign luxury products, launched a campaign to offer shoppers exactly what they want: assurance that they’re getting the best possible prices.

Simply stated, the RED campaign promises to price match competitors. But RED has made it into a game of sorts, encouraging shoppers to shout out their favorite products on social. How it works: When a consumer finds a pricey purse or luxurious lipstick they want, they post it on Weibo, China’s answer to Facebook and Twitter, along with the competitor’s price and the campaign’s hashtags.

By enlisting fans and driving interactions through social, the company has garnered lots of attention. The ‘pay the difference’ campaign has resulted in more than 22 million views and 24,000 comments.

The campaign is also tapping into a major concern among China’s cross-border shoppers, who pay high value-added and consumption taxes on those goods. RED, which has positioned itself as a low price option, has developed this creative way to spread that message.

“First, the social media community that we build in the app provides us with data to accurately calculate the demand for each product, improving the inventory turnover rate,” CEO Mao Wenchao is quoted as saying. “In addition, we have built our international logistics team and overseas warehouses that lower our costs.”

RED’s ability to successfully marry social with e-commerce stands in stark contrast to the efforts made by many traditional retailers and publishing companies that have been grappling with this dilemma since the dawn of online shopping.

A prime example is Condé Nast, which has made quite a few missteps in its attempts to monetize its editorial offerings. One of the most recent was Lucky Shops, an e-commerce offshoot of its now-defunct shopping title. The site, which was operated as a separate entity in collaboration with BeachMint, made it less than a year before it folded.

Today, the publisher announced it has scrapped its $100 million investment in Style.com, which it had rebranded from a runway image resource to an e-commerce hub just nine months ago. Jonathan Newhouse, chairman and chief executive of Condé Nast International, told The New York Times that Style.com had “fallen very far short of where we hoped they would be.”

While the company says it learned a lot about the value of editorial in e-commerce, it now acknowledges that it didn’t have the skill set to make the sales piece work. It is now moving forward with a partnership with Farfetch, the international luxury marketplace that Condé Nast invested in in 2013, which is also rumored to be closing in on an IPO valuing the company at $5 million.

To start, U.S. readers of Vogue and GQ will be able to shop editorial content. Condé Nast will also create shopping guides that will run in the magazines and on Farfetch. While social media was mentioned in the launch release, it is not clear if the new collaboration is planning to take full advantage of the marketing channel.

“This global partnership with Condé Nast will significantly augment the retail experience for our customers, and we see it as a natural step in Farfetch’s approach to commerce and our strategic vision to connect those who create fashion, curate fashion and develop fashion content,” José Neves, founder and CEO of Farfetch, said in a statement.

It is a formula perfected by Natalie Massenet, founder of Net-a-porter, who is now on the board of Farfetch.

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