What: The luxury conglomerate is deepening ties to build up AI capabilities in China.

Why it is important: It highlights how the partnership between LVMH and Alibaba use advanced AI to enhance customer experiences in China.

LVMH and Alibaba have extended their partnership to enhance LVMH’s digital, data, and omnichannel capabilities in China. This collaboration works with Alibaba Cloud’s advanced AI technologies, including Model Studio (Bailian) and the Qwen large language model, to provide a more personalized shopping experience. These AI tools will make it easier for LVMH’s customers to have customized recommendations and richer digital interactions.

Since 2019, LVMH has utilized Alibaba Cloud’s Dataphin and PAI platforms to manage data and develop tailored services for the Chinise markey. The partnership has enabled about 30 LVMH brands to use digital features like live streaming, virtual try-ons, and 3D product displays on Alibaba’s Tmall Luxury Pavilion.

The integration of AI also aims to improve operational efficiencies, such as supply chain management, by providing accurate demand predictions and inventory management. This is critical given the current unstability in the Chinese market, where LVMH has experienced a decline in sales.

The collaboration allows LVMH to better navigate the complex Chinese digital ecosystem, which is dominated by super-apps and rigid data regulations. It also supports LVMH’s broader strategy of enhancing omnichannel capabilities and delivering emotionally engaging digital experiences.

Overall, this partnership is expected to not only elevate LVMH’s market presence in China but also to  provide Alibaba with a stronger reputation, reinforcing it as a key player in the luxury market.

Decoding LVMH’s partnership with Alibaba