The digitalization of luxury is changing the rules of the game. With Chinese social media influencing millions of consumers worldwide and payment systems simplifying cross-border purchases, luxury brands now find direct access to markets as diverse as Europe, the Americas, and Southeast Asia. For millions of Chinese consumers traveling or living abroad, brands like Hermes, Dior, and Louis Vuitton are no longer experiences reserved for local boutiques but part of a borderless digital ecosystem.
The Chinese social media and e-commerce app Xiaohongshu already has more than 300 million monthly active users, making it an essential driver of luxury product discovery. Its conversion rate for international brands reaches 21.4%, a level that demonstrates its power to turn inspiration into purchases. Due to its international growth, including a user base of Chinese living abroad, it is accelerating: while a significant portion of its users remain in China, the share in external markets is expanding rapidly.
Digital platforms like Xiaohongshu and Douyin are becoming the main tools in America and Europe for frequent travelers, students abroad, and anyone maintaining a digital link with China. For example, someone in Los Angeles can find services and products through Xiaohongshu as easily as in China, and this digital bridge creates powerful local communities. In addition, according to the Douyin Luxury Industry Report by Deloitte, 53% of Chinese luxury consumers already shop through digital channels such as official stores, luxury e-commerce, or social platforms, and 73% use Douyin to follow content and trends in the sector.
Luxury No Longer Lives Only in China
The concept of LTTs (long-term temporary) refers to people who live temporarily or semi-permanently outside of China, such as students, expatriates, and workers with extended permits. Although they are not permanent residents, they maintain consumption habits, cultural identities, and digital ties with China.
Traditional barriers to international trade, such as tax laws, VAT procedures, and logistics, are being redesigned thanks to digital tools. Social digital platforms enable cross-border sales, digital payments, and international delivery, while guaranteeing authenticity, service, and reputation. This reduces friction for consumers outside China who purchase through Chinese digital channels.
These communities consume content on Chinese social platforms, follow influencers in their local networks, and value experiences, authenticity, and quality over just brand recognition. Luxury brands that adapt to Chinese who live or study abroad with local campaigns, content in Chinese, easy digital payments, simple tax refund processes, and reliable shipping will be able to tap into significant spending that today is fragmented and underserved.
This type of combined social platform, e-commerce, payment, and logistics makes it possible for a luxury brand based in Paris or New York to sell almost instantly to someone in LA, Vancouver, Berlin, or Rome, who browses Xiaohongshu or Douyin and pays digitally.
Challenges of Digitalization for Luxury Brands
In luxury tourism, more than 155 million international trips from China are projected in 2025, surpassing pre-pandemic levels. Of these travelers, approximately 28% plan to spend at least US$6,890 per trip, highlighting a segment with high budgets for airport boutiques, luxury, and experiences. Nearly 45% of high-spending travelers belong to the generations born in the 1990s and 2000s, who are much more inclined to use digital platforms to discover experiences, products, and destinations.
Despite the opportunities, there are several challenges brands must understand:
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Tax regulation and compliance: Programs such as VAT require coordination with local laws, customs authorities, immigration policies, etc. As Japan’s case shows, what begins as innovation can be adjusted or shut down if there are abuses or significant fiscal losses.
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Brand authenticity and customer experience: Luxury consumers value service, quality, history, and craftsmanship. Digital payments and global visibility are not enough if the experience does not feel premium and aligned with brand values.
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Localization vs. standardization: Striking a balance between maintaining the brand’s global identity and adapting to the local tastes of LTT communities. This may involve campaigns in mixed languages, local Chinese-origin influencers, and content that blends the international with the familiar.
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Payment technology and security: Cross-border digital payment solutions involve banking challenges, fees, exchange rate fluctuations, fraud protection, data privacy, and more.
Luxury Redefines Borders
Luxury is no longer limited to flagship stores in capitals or boutiques in global cities. With platforms like Xiaohongshu and Douyin targeting Chinese communities abroad, along with digital payments and fiscal policies such as VAT, brands now have a faster, more direct, and more emotionally connected path to Chinese consumers spread across the world.
Xiaohongshu is more than a social app; it has expanded its vision toward commerce, with over 225 million monthly active users. It thrives on authentic user-generated content, where people post “Notes,” image carousels, videos, and personal reviews about their experiences with products, travel, fashion, and gastronomy. Xiaohongshu’s user base is 70 - 80% women, primarily Gen Z and Millennials (under 30 years old), located mainly in tier-1 and tier-2 cities, trend-conscious, with high purchasing power and a defined lifestyle.
This has turned the platform into a strategic marketing channel where discovery, validation, and loyalty occur long before a sale. Influencer marketing is fundamental to many successful Xiaohongshu strategies. But it’s not only about securing celebrity endorsements; in fact, KOCs (Key Opinion Consumers) often generate more trust than high-profile KOLs (Key Opinion Leaders).
Brands that understand that luxury consumers move both digitally and physically, that they are influenced by multiple geographies, and that they expect experience, service, and seamlessness throughout the entire journey from discovery to payment and delivery will be the ones to lead in this new global map of luxury in digital channels.