In the newly released COMPASS Index Q2 2025, several standout brands reveal early signals of market recovery, underscoring how strategic agility enables them to navigate the ongoing “new normal.”
Social media engagement, however, continues to decline. Both brand-generated content interactions and user-generated content (UGC) discussions are waning across major platforms. Weibo, WeChat, and Douyin all experienced further drops in brand content engagement, while RedNote’s growth decelerated to modest low double digits. Notably, RedNote’s UGC mentions—a critical measure of authentic brand buzz—have fallen for three consecutive quarters, reflecting a diminished luxury focus among younger consumers.
ECommerce, by contrast, offers a more optimistic outlook. The number of brands suffering year-on-year sales declines has shrunk markedly since Q1, with 45% of brands registering positive growth in this channel.
Fashion and Leather Goods:
Ready-to-wear led the charge with over 10% growth this quarter, while accessories also rebounded. The sector’s revenue powerhouse—leather goods—still saw a decline, though the drop was less severe than in the previous quarter. The extended 618 festival enabled premium and designer brands to capitalize on agile discounting strategies, fueling revenue gains. Notable performers such as Acne Studios, MCM, and Maison Margiela made significant leaps in our eCommerce rankings.
On social platforms, many brands approached the 520 festival more cautiously, but a few generated strong buzz through brand campaigns. Coach, for instance, launched a high-impact fragrance campaign by appointing Chinese singer Liu Yu as its ambassador just ahead of 520, resulting in exceptional engagement on its owned channels.
Watches and Jewelry:
As a local festival celebrating love, 520 represents both marketing and sales opportunities for watches and jewelry brands, yet these two categories displayed contrasting performances in terms of revenue. Jewelry saw modest year-on-year growth (1%) during this key gifting season, whereas watches continued to experience steep double-digit declines.
Social media engagement was more balanced between the two categories. Piaget rose to 11th place in this quarter’s Marketing Index, driven by strong engagement following the appointment of its new Chinese ambassador, Chen Zheyuan. Jewelry brands such as Qeelin, Graff, and Tasaki also successfully amplified their presence with campaigns centered on the love festival, sparking vibrant consumer conversations.
To explore detailed rankings and case studies, please download the full COMPASS Index Q2 2025 report.
