??New Report: COMPASS Index Q2 2025
The latest edition of our quarterly COMPASS report is out.
As China’s luxury market shows early signals of stabilization, the race to capture share of consumer wallets is heating up fast. One thing is clear from our Q2 findings: brand visibility alone is no longer a strong competitive advantage as user engagements wane. Beyond top-of-the-funnel awareness, brands need to recalibrate their strategies at the bottom-of-the-funnel as well, enforcing portfolio discipline and optimizing merchandising strategies to convert attention into growth.
My 3 key observations from Q2:
?? Brand Engagement is Declining Across Social Platforms
The only social platform in China that continues to exhibit growth in terms of brand engagement is RED, and even then, this growth appears to be slowing. This quarter, consumer engagement with brands on RED was at 12.4%. However, while user-generated content on Douyin displayed an uplift of 43.1% this quarter, it fell by over 24.4% on RED.
Brand-generated content continues to lose traction across all platforms. The only exception is RED, but even there, growth is slowing. In Q2, brand engagement on RED increased 12.4% YoY, while user-generated content on Douyin surged +43.1, ?but dropped -24.4% on RED. The consumer voice is getting louder; brands need to listen and adapt.?
?? Tmall Revenues Show Early Signs of Recovery
Of the 102 flagship stores we tracked, 36% saw revenue declines of >10%, a clear improvement from 61% in Q1. Ready-to-wear continues to lead, delivering +10% YoY growth and leather goods show early signs of improvement.
?? New Growth Patterns Revealed by the GLOW Index
Our proprietary GLOW Index measures how new product launches drive revenue growth, allowing brands to benchmark performance, identify strategic white spaces and optimize future assortments. This quarter, brands like Acne Studios led with an index score of 0.72, while Ralph Lauren maintained steady performance at 0.60, showing there is room both for momentum plays and for timeless consistency.
Powered by our COMPASS platform, this report benchmarks 150+ luxury and premium brands across marketing, ecommerce and merchandising in China. It highlights where momentum is building, where it is fading, and where to act next, helping leading luxury brands to inform their strategy in the market.
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