Casey Hall

SHANGHAI, (Reuters) – Ms. Zhang did not expect that she would receive complimentary ready-to-eat desserts and meals from luxury brands like Louis Vuitton or Cartier the next day as she sat down to secure Shanghai’s lockdown.

Brands have been able to deliver gifts to very important clients (VICs), such as Zhang, a 24-year-old entrepreneur.

Zhang stated that, even though the gifts are not of high value, it was an effort to remain in touch with her family. Zhang requested anonymity and would only be identified as Zhang by his surname.

Shanghai was home to some the most strict containment measures in the world. Shanghai residents are prohibited from leaving blocks in which COVID-19 case have been discovered, while entire streets and buildings have been fenced off.

Residents are struggling to find food after supermarkets closed and logistics companies were upended. The government has provided limited assistance to fill the gaps, but there have been mixed reports from different districts.

Many companies provide food and other assistance to their employees. Many companies have sent goodies out to employees in partnership with luxury brands and banks, which is a great privilege.

The epidemic made class division even more evident. Weibo user Li Xiaozhou wrote that ordinary citizens grab rice and luxury brands want to provide first-class food for VIPs.

Some brands also offer classes online, in addition to gifts. La Mer has provided DIY facials, while Dior offered virtual yoga classes for seven days at its premium studio.

Prada (OTC) hosted a virtual culture club that invited writers, directors, and musicians to suggest books, movies, and albums.

Prada SpA did not respond to Reuters’ request for more information, other than that the initiative was well received.

Christian Dior SE, LVMH Moet Hennessy Louis Vuitton SE (OTC) declined to comment

Cartier is owned by Compagnie Financiere Richemont SA and La Mer by Estee Lauder Companies Inc (NYSE 🙂 did not respond when asked for comment.

EMOTIONAL CONNECTION

Re-Hub Shanghai-based strategy head Thomas Piachaud stated that China has as high as 12% of its luxury online retail in Shanghai. This means store closings are necessary to serve VIPs virtually.

Piachaud stated that this group of consumers is most likely to be able to escape from the economic effects of lockdown, and will emerge ready to spend more.

These VIP customers can be referred to as the people brands get to know more intimately. He said that brands know how to customize communications to customers and communicate with them.

Lily Lu is senior business director, digital marketing at Gusto Luxe. Luxury does not only sell products, it also offers an emotional connection.

Lu said, “There’s a connection that transcends the product.” Even if the customer is unable to buy products right away, that bond must be nurtured and maintained during difficult times.

The VIC status is based on an annual spend of several hundred thousand yuan ($15,000 at certain brands), though the minimum amount can vary widely. The status can be awarded by sales personnel to anyone they feel is likely to spend more.

While Shanghai VICs can’t spend in store at the moment due to lockdown, many brands want them to do so when it is lifted.

Zhang stated that she received 10 flowers and birthday cakes from various brands, in reference to her mother who is also a VIC. “I am certain after lockdown purchases will be made.”