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Alibaba launches 'Luxury Pavilion' to court wealthy Chinese consumers

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Alibaba launches 'Luxury Pavilion' to court wealthy Chinese consumers

Chinese e-commerce giant Alibaba Group Holding Ltd. has launched a dedicated section for premier brands on its business-to-customer site Tmall.com.

The invite-only "Luxury Pavilion" features brands such as Burberry Group Plc, Hugo Boss AG, La Mer, Maserati and LVMH Moët Hennessy Louis Vuitton SE's Guerlain and Zenith. It offers products ranging from apparel and skincare to watches and luxury cars.

Alibaba said the pavilion will eventually offer a complete suite of marketing and omnichannel features, allowing shoppers to use personalized homepages, customized brand pages, product recommendations and exclusive VIP awards.

Brands will also be able to use virtual reality and augmented reality to reach customers, Alibaba said.

Alibaba's move comes as more and more luxury brands expand their online distribution channels in Asia and consumers opt to shop online. Consultancy KPMG has predicted that 50% of luxury brand sales in China will be made online by 2020, according to Alibaba.

Alibaba's major rival JD.com Inc. has also stepped up expansion into the online luxury realm. In June, JD.com invested $397 million in London-based luxury e-retailer Farfetch, allowing luxury brands to reach Chinese consumers. Kering SA-owned Saint Laurent will launch online sales in China through the new JD.com-Farfetch platform.

Meanwhile, both Louis Vuitton and Gucci have launched their own e-commerce sites for China.