How ERDOS Transformed from “Outdated” to Iconic
In the ever-evolving fashion world, countless brands rise and fall like fleeting comets, shining briefly before fading into obscurity. For legacy Chinese brands to remain relevant and thrive in this era of rapidly shifting consumer preferences, constant adaptation and innovation are essential.
As a shining example of transformation, the Inner Mongolia-based cashmere brand Erdos has successfully reinvented itself, challenging luxury stalwarts like Brunello Cucinelli and Loro Piana with its approach to understated elegance.
“In the early 2000s, I often heard people say, ‘The quality of our cashmere is excellent, but they feel outdated.’ That made us question—does cashmere have to be a product exclusively for middle-aged consumers?” recalls Dai Tana, General Manager of Erdos. “The word ‘outdated’ reflected a perception that our brand lacked vitality, revealing a deeper stagnation issue. This wasn’t just about product design; it also encompassed retail experiences and communication strategies.”
Thus began a comprehensive brand overhaul.
Awakening in Crisis
Erdos Group originated from the Ikh Zasag Cashmere Sweater Factory, founded in 1980. With access to the region’s high-quality cashmere, the factory quickly established itself in the market. In 1984, during a trip to Japan, factory manager Wang Linxiang realized that the retail price of cashmere sweaters was several times higher than the cost of raw materials. This insight underscored the need to create a unique cashmere apparel brand.
In 1989, Erdos launched its brand with advertisements on China Central Television, reaching millions of viewers. The slogan “Erdos, Warming the World” rapidly increased brand recognition, making Erdos synonymous with cashmere clothing in China.
However, as time moved forward, the brand’s prominence began to fade in the face of changing consumer demands and fast-evolving fashion trends.
This era aligned with China’s GDP growth, which consistently ranged from 7% to 14% annually. Yet, in 2008, despite a 10.28% year-on-year increase in overall apparel sales, cashmere—often called “soft gold”—saw a decline in retail sales. Consumers began seeking fashionable cashmere options, indicating a pressing need for innovation in the industry.
In 2006, Wang Linxiang’s daughter, Wang Zhen, a Cambridge University graduate, joined Erdos and launched the high-end cashmere brand “1436” as her first major initiative.
Erdos later welcomed Gilles Dufour, a French designer with 15 years of experience at CHANEL and a close associate of Karl Lagerfeld. Dufour introduced a new design vision, featuring innovative pieces like cashmere appliqué embroidery and “rainbow-button” cashmere sweaters at his first showcase, breaking the stereotype of cashmere as dull and conservative.
He also wisely chose rising model Liu Wen as the brand ambassador. Liu Wen’s career took off, and she frequently appeared in Victoria’s Secret fashion shows, strengthening her partnership with Erdos.
A Luxury Misstep: Learning from Setbacks
To enhance its fashion image, Erdos moved many of its stores to upscale shopping centers to compete with leading brands. Unfortunately, this strategy backfired, leading to a loss of loyal customers while failing to attract younger shoppers. From 2011 to 2014, the apparel segment’s revenue dropped from 2.92 billion yuan to 2.36 billion yuan, nearly a 20% decline, and the brand earned the label “expensive and outdated.”
This setback made Erdos realize that transformation takes time. In 2014, Wang Linxiang stepped down, and Wang Zhen implemented advanced management practices, including collaboration with McKinsey & Company to establish a Project Management Office (PMO), signaling the start of a new round of reforms.
A pivotal moment occurred in September 2016 when Erdos held a brand event at Beijing’s 751 D-Park, a trendy area converted from old factories, similar to New York’s SoHo. At this event, Erdos redefined its brand into two distinct entities: ERDOS, targeting urban professionals with fashionable cashmere, and Erdos 1980, offering classic cashmere for mature consumers. Subsequently, the brand introduced erdosKIDS for children and BLUE ERDOS for a younger audience alongside its high-end sub-brand 1436, successfully creating a brand portfolio that caters to various age groups and consumer needs.
In 2018, ERDOS and Liu Wen launched their first collaborative collection, and over the next six years, they released five co-branded series, many of which gained significant attention on social media for their unique designs.
Erdos also enlisted designer Graeme Black, known for his bespoke work with former First Lady Michelle Obama. Under Black’s direction, the “1436” line shed the stereotype of cashmere sweaters as “mom sweaters” among young consumers, evolving into a more fashionable and upscale collection.
The results of these brand reforms were significant: in 2018, Erdos’s apparel segment generated revenue of 3.356 billion yuan, an 18% increase year-on-year. However, Erdos was not content with just this success and continued to pursue collaborative efforts. For instance, in 2022, Erdos 1980 partnered with the Metropolitan Museum of Art in the U.S. to launch a collaborative collection. In December 2024, Erdos 1980 collaborated with the American ski brand BURTON to introduce an outdoor cashmere collection.
In March 2024, 74-year-old Maye Musk visited China and proudly shared photos of herself wearing Erdos clothing. The brand, often perceived as outdated, garnered unexpected attention from the mother of the world’s richest man, providing a powerful endorsement for Erdos.
Revolutionizing Retail: Digital Meets Physical
In 2010, Erdos entered Tmall, China’s largest comprehensive e-commerce platform owned by Alibaba, marking the beginning of its online business expansion. By 2017, e-commerce sales accounted for 10% of Erdos’s total revenue. In 2021, the ERDOS Tmall flagship store saw its follower count increase tenfold over four years, reaching 2 million. As of January 2025, ERDOS’s brand store has amassed 2.84 million followers, with total followers across its five brands exceeding 4 million, maintaining its position as a leader in its category. According to Wang Zhen, this rapid growth can be attributed to Erdos’s active exploration of various innovative marketing strategies online, such as participating in Tmall’s Fashion Carnival, Star Labs, and Crazy Wardrobe events. Store hosts showcase the products during live broadcasts, providing detailed information about the materials and craftsmanship, as well as sharing styling tips and fashion philosophies, allowing consumers to see Erdos as not just a clothing brand but a proponent of a fashionable lifestyle.
Notably, online feedback on the brand’s revitalization has proven to be more impactful than offline. Wang Zhen mentioned that after the new product launch in September 2016, the online average order value doubled within a year.
On the offline front, Erdos has also significantly adjusted its channel strategy, including redesigning and renovating physical stores to present a fresh new space and image. Additionally, it has increased its presence in core quality commercial districts in first- and second-tier cities.
As early as 2014, the “1436” brand made its debut on the fourth floor of Beijing SKP, the highest-grossing high-end mall in China, becoming the only Chinese brand on that level that year. Following this, it also entered renowned department store landmarks such as Kerry Center and Jiuguang Department Store. Competing alongside many leading international brands has elevated Erdos’s prestige and visibility.
In terms of new store design, while Erdos 1980 primarily targets middle-aged and older consumers, it promotes a “timeless” approach in its store layout and product display. The in-store island area cleverly blends clothing and accessories with a homey atmosphere, creating a relaxed and comfortable shopping environment. The design of BLUE ERDOS stores is very modern, utilizing the interplay between display racks to form a unique geometric aesthetic. Meanwhile, the flagship store for 1436 features a focus on natural wood and abundant natural light, with a display primarily featuring stacked clothing to highlight the quality of the garments, accompanied by limited hanging displays.
In terms of store experience, Erdos continues to innovate. For example, the 1436 stores host handcrafted activities, allowing consumers to physically touch cashmere materials and learn about the production process from raw material to finished product, thereby enhancing the emotional connection between consumers and the brand.
Additionally, Erdos 1980 has integrated home concepts by creating the “Cashmere Lifestyle” flagship store. This store uses “home” as the core design philosophy, adorning various living spaces with cashmere materials to create a relaxed and spacious home atmosphere.
In June 2024, Erdos opened its first 1436 CAFÉ in Beijing’s China World Mall, combining a boutique, café, and lifestyle aesthetics. This initiative aims to meet the ever-evolving demands of consumers through cross-industry expansion and diverse experiences.
According to Erdos Group’s 2024 semi-annual report, the company currently operates a total of 1,003 stores, including 620 directly operated and controlled stores, as well as 383 franchise stores. The brand is also making full use of online platforms such as Tmall, JD.com, Douyin, Vipshop, and Xiaohongshu, along with 12 mini-programs that integrate online and offline operations. This strategy has helped build a new retail growth model that is data-driven, experience-oriented, and finely tuned for operations.
Overcoming Obstacles: Erdos’s Competitive Edge
Erdos has made significant achievements in brand transformation and omnichannel customer experience, but it still faces several challenges. For example, the COVID-19 pandemic caused fluctuations in the revenue of Erdos’s clothing segment. However, thanks to the brand’s inherent resilience, Erdos successfully rebounded in 2023, with sales reaching 3.756 billion yuan.
As a result, more and more media outlets have taken notice of Erdos’s successful transformation. A March 2024 article titled “Even with a Monthly Salary Over Ten Thousand, People Hesitate to Buy Erdos” trended on Weibo, with topic views reaching 280 million. This demonstrates Erdos’s strong influence in the consumer market, but it also presents new demands: to continue exploring ways to enhance brand value and narrow the gap in brand premium compared to international luxury brands.
At the same time, market competition is becoming increasingly intense. Preliminary financial data for early 2024 from the Italian brand Brunello Cucinelli shows consistent growth in the Chinese market, particularly with a nearly double-digit year-on-year increase in the fourth quarter. Loro Piana also sees the Chinese market as a key growth driver, with a total of 43 stores in mainland China and Hong Kong, Macao, and Taiwan, accounting for over a quarter of its global store count.
Chinese brand ICICLE aims to gain a share of the high-end cashmere market as well. After acquiring MaxMara’s Chinese manufacturing plant, it promotes cashmere apparel tailored for Asian consumers, maintaining a foothold in the minds of Chinese shoppers. Faced with these formidable competitors, Erdos’s pressure is evident. Yet, within this fierce competition lies limitless opportunity.
Brunello Cucinelli, the founder of the eponymous brand, has noted that the growth in the Chinese market is driven by customers’ emphasis on garment craftsmanship, the brand’s positioning of “absolute luxury,” and the acceptance of unbranded ready-to-wear products. This shift in consumer trends aligns perfectly with Erdos’s commitment to high quality, undoubtedly presenting new development opportunities for the brand.
The Future is Bright
Erdos stands at a pivotal moment where it can leverage its heritage in premium cashmere craftsmanship and recent brand transformation to emerge as China’s answer to Brunello Cucinelli; this requires a carefully orchestrated elevation of its brand positioning, product offering, and customer experience that bridges Eastern craftsmanship with global luxury sensibilities.
To truly compete with Cucinelli’s position as the king of casual luxury, Erdos must double down on its storytelling around Inner Mongolian cashmere while simultaneously modernizing its creative direction through elevated design, continuing to pioneer sustainable practices in cashmere sourcing and production, developing immersive retail concepts that showcase its artisanal expertise, expanding its lifestyle offering beyond knitwear into a full ready-to-wear collection with sophisticated casual pieces, implementing selective distribution focused on luxury channels and flagship stores in key global fashion capitals, and building cultural cachet through strategic collaborations with contemporary artists and designers who can help reinterpret traditional Chinese aesthetics for a global audience.
On the customer experience front, continued success will come through revolutionizing the approach to match the high-touch, personalized service standards set by luxury houses like Cucinelli, while adding distinctive Eastern hospitality elements that can become a brand differentiator – e.g. developing white-glove clienteling programs that e.g. combine traditional Chinese tea ceremonies with personal styling sessions, creating intimate VIP spaces within flagship stores that offer private cashmere education and care workshops, implementing digital innovation through virtual wardrobe curation and styling services, and establishing a loyal customer community through exclusive access to artisan demonstrations, sustainability initiatives, and cultural events that celebrate the brand’s heritage. The customer journey should feel intimate and educational, with highly trained brand ambassadors who can eloquently communicate both the technical expertise behind Erdos’s cashmere craftsmanship and its cultural significance while delivering the kind of warm, anticipatory service and relationship-building that sophisticated luxury consumers have come to expect.
Continued success in brand elevation and competitive standing will be a result of Erdos’s ability to transform from a respected domestic brand into a luxury house that can compete on the global stage by offering a unique proposition that combines Eastern heritage and craftsmanship with contemporary luxury lifestyle, thus possibly becoming the first Chinese luxury brand to achieve true international recognition alongside established Western luxury house.
Authored by Jessica (Siqi) Tian
