Female Luxury Shoppers Powering Growth Of Luxury Brands Throughout Country, From First To Third-Tier Cities
Shaun Rein sees the female demographic as one of the major drivers of luxury spending in China over the long term
Shaun Rein, founder and managing director of the China Market Research Group, writes an interesting feature today for Forbes, focusing on female Chinese shoppers, and the continued growth that this demographic has shown in the face of the global recession. Although female luxury customers have largely cut back in traditional luxury markets like Japan and North America, spending remains strong in emerging markets like China, where luxury brands are still new to some second- or third-tier cities — where much of China’s sustained growth will center in coming years, as we have written before.
As Rein sees it, the urban female demographic shows great sustained potential because of the speed at which they have become choosy — rather than simply profligate — spenders. Chinese shoppers are increasingly purchasing luxury goods because they like them, and have developed stronger brand loyalty based on style or quality, rather than simply spending for spending’s sake. This is a good thing for major brands, many of which take unique advertising or marketing strategies for the Chinese market to carve out loyal niches. Obviously, this strategy is working, as Rein notes, “Women [in China] are becoming less price sensitive and more sophisticated about the brands and products that they finally buy.” Unlike many male shoppers in the Chinese market, who are less apt to shop around or develop strong brand loyalty — mainly choosing based on status (for automobiles, mainly) or price (see success of Ferragamo and other high-end men’s luxury apparel brands) — women are more likely to become brand “connoisseurs.”
Posted in Business, China, Culture, Economy, Fashion, Investment, Luxury
Tagged China, demographics, ferragamo, Luxury, porsche, shopping, spending, women
Brands Spending Heavily On Advertising, Brand Messaging To Maintain Strong Growth In Competitive Developing Markets
The Luxury Institute's results seem to indicate that luxury brands with a strong foothold in China will need to work harder to maintain their dominance
This week, the Luxury Institute published its list of the top luxury brands in China, as ranked by Chinese high-net-worth consumers. While the results are not terribly surprising — as the “Best of the Best” probably don’t differ dramatically from any other major luxury market — it is still important to see that traditional favorites like Louis Vuitton (for women) and Dunhill (for men) have slipped a bit. This (to me, at least) gives an indication that brands which have developed strong footholds in the Chinese market throughout the late ’80s and ’90s are giving luxury shoppers in China a bit of “luxury fatigue.”
Possibly driven by younger luxury shoppers in the cosmopolitan east (where consumers are generally more trendy as well as picky), the split between brand lust in first- and second-tier cities must be growing nearly as fast as the advertising expenditures. Unfortunately, the Luxury Institute’s results do not break the survey down into regional variations, so I’m basing all of this on my own observations and opinions.
Posted in Automobile, Business, China, Culture, Fashion, Luxury
Tagged armani, asia, bmw, China, ferragamo, gucci, hermes, Luxury, mercedes, paul smith, porsche, prada
Gucci and Ferragamo Join Burberry In Opening New China Locations In ’09
Ferragamo in Shanghai: The Luxury brand hopes to add 7-8 locations in China this year. Photo © Time
The Mercury News reports today on hopes by luxury retailers that well-heeled Chinese shoppers, who have cut back less than their Western and Japanese counterparts, can buoy the luxury goods market enough to get them through the economic downturn. While China itself has been hit hard by the global economic downturn — particularly in its manufacturing and export sectors — a series of domestic stimulus packages and efforts to bolster consumer confidence have begun in earnest to take effect (as we have written before). Although a broader recovery, especially in the more rural or far-flung areas, will take some time, in China’s metropolitan centers like Beijing and Shanghai, the wealthy and upper-middle-class have continued to shop. And for that, luxury brands from around the world are looking at this consumer class as one of their few bright spots in the global economy.
Posted in Business, China, Economics, Economy, Fashion, Investment, Luxury
Tagged chanel, chateau lafite, China, coach, Economy, ferragamo, global economic crisis, gucci, hermes, louis vuitton, Luxury, porsche, shopping