Alibaba Group And Richemont Invest Nearly $1 Billion In Luxury Retail Platform Farfetch

China based Alibaba Group and Swiss company Richemont have announced their strategic partnership with UK based online fashion retailer Farfetch to capitalize on China’s growing luxury market.

The companies have invested around $300 million each in convertible notes issued by Farfetch Limited.

Both the businesses are to invest an additional $250 million each, supporting the market operations of Farfetch in China. Richemont and Alibaba will hold a combined stake of 25% in the company.

Daniel Zhang, the Chairman and CEO of Alibaba Group believes that this partnership will allow the luxury market in China to grow drastically, that is predicted to account for over half of the global luxury sales by 2025.  Partnering with Farfetch allows easy access to digitization of the luxury retail market to fully transform consumerism.

Through this new partnership Farfetch will be able to cater to Alibaba’s 757 million customers, while Alibaba will feature Farfetch shopping channels across the TMall global marketplace, TMall Luxury Pavilion and Soho.

Keeping the idea of digitizing the luxury space, Alibaba and Farfetch have come up with a new concept known as Luxury New Retail (LNR).

The advent of LNR will allow consumers to access Farfetch and TMall through a single integration along with fully connected e-commerce channels and websites across omnichannel technology.

This $1 billion investment is a huge step towards revolutionizing the luxury industry across multiple facets by connecting creators, curators and consumers.

The power of LNR will help in facilitating digital transformation across the luxury space and help the industry thrive post pandemic.