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    How To Read Consumers On The Second Line Of Luxury Goods

    2011/3/16 10:13:00 67

    Luxury Consumer Market

    Go, go second line—an advisory post This is a lot. Luxury goods Brand consensus on the Chinese market. Indeed, the gold mine in the luxury market of second tier cities in China is still being explored. There is still one way to read consumers.


    No country like China can make the world's luxury brands laugh so sweetly. According to Bain's 2010 survey of luxury goods in China, the major luxury goods suppliers took out 68 billion 400 million yuan from the Chinese pocket in 2009, and estimated growth of 23% in 2010, reaching about 84 billion yuan.


    Nowadays, Louis Vuitton GUCCI and Chanel have long been familiar with consumers in the first tier cities, and have gradually become the "second-class" consumers of luxury goods in second tier cities. In the recently released white paper on luxury goods in second tier cities in China, we found that the number of luxury goods sold in Beijing, Shanghai, Guangzhou and other first tier cities has been comparable to those in New York and Chicago. The next wave of luxury brands will appear in China's second tier cities.


    This is the horror of the Chinese market. Apart from the huge base, there is still boundless potential. Understanding and grasping the characteristics of the consumers in the second tier market and targeted marketing strategies are the direction that all luxury brands need to strive for.


    Go to the second line!


    According to the latest Asia Pacific data released by Goldman Sachs, almost all the luxury brands that have landed in China have gained two digit growth in 2010, and many second tier cities in China are also throwing away the "brand desert" hat. With the development of communication information, the consumers' awareness and desire for luxury brands in the second tier cities are greatly improved, and the gap between the consumers and the consumers in the first tier cities is obviously reduced.


    On the other hand, due to the saturation of the market in the first tier cities and the shortage of suitable property scarcity, the luxury army has cast its eyes on the second tier cities.


    Hangzhou: Italy luxury clothing brand Canali in Beijing Dongfang Plaza store has not yet profit, Hangzhou single store monthly income has reached 1 million 500 thousand yuan, the best store in the country.


    Ningbo: Ho Yi Avenue, a high-end commercial center in Ningbo, is becoming the second lakeside international famous street. Louis Weedon opened a shop with an area of 1016 square meters at the entrance of the Plaza. In Ningbo, most people who buy luxury goods are 25~45 years old white-collar and private owners. They have a keen sense of fashion and are very sensitive to the quality of life, and the energy consumption is amazing.


    Wuxi: Louis Weedon's eight hundred friends shop has achieved sales of nearly 2 million yuan on the day of its opening, and its daily sales volume has reached about 1000000 yuan for four days. At present, it is steadily about 400000 yuan per day. Spain's high-end brand Loewe has also introduced garment tailored service to Wuxi for nearly half a year. The number of VIP guests has been directly following the early opening of Nanjing, Suzhou and Hangzhou. The VIP customers of the brand are all those who spend more than 50 thousand yuan a year.


    Chongqing: Xingguang 68 international famous Plaza, which is completed in Chongqing, includes over 40 major international brands including the world's top ten luxury brands. Armani and baozi have worked hard when they first entered Chongqing. But now, the annual sales volume of the market has increased by nearly 3 times. Among the more than 70 sales outlets in the country, Chongqing has the fastest growth rate.


    Shenyang: the most impressive thing that Shenyang has given to the Chinese people is that the performance of the sales list has always been the highest in the country. Shenyang's luxury goods consumers are fixed and can attract high-end crowds from surrounding cities. Zhongxing international famous Plaza sold for the first time in the first quarter of 2010, breaking through billion yuan mark to achieve two digit growth. Take Dior brand counters as an example, sales in March have risen to the number one in the country.


    Zhengzhou: the right garden department store ushered in Cartire at the end of 2009, plus the store of Denis people's shop. Cartire sold two pieces of chess in the second tier market Zhengzhou, which is rare in the second tier cities in China. Fer ragamo (Ferragamo) opened in Zhengzhou in December 26, 2009 and the Cartire tank watches series was officially settled in Zhengzhou in January 9, 2010 and the first shop in Henan GUCCI opened in March 2010.


    Their five characteristics


    China's first tier cities are strategic forts for brands to build their image, while second tier cities will be the key to success. It is far from enough for luxury brands to succeed in the second tier cities. It is far from enough to stay at the shops only. How to implement a complete and effective market strategy will be the key to developing the second tier cities.


    According to the comprehensive survey, luxury consumers in second tier cities have the following characteristics:


    No bad money: Zhou Ting, deputy director of the Cheung Kei luxury research center of the University of foreign trade and economics, said that in the two or three tier cities, luxury consumption is not rational enough. It belongs to the stage of material and conspicuous consumption. It pays more attention to brand awareness and the frequency and quantity of luxury goods. A survey shows that in the consumer group with a monthly income of 50 thousand ~10 yuan and 100 thousand yuan or more, the consumption of luxury goods on the two or three tier cities is almost equal to that of the first tier cities. 54.6% of the consumers in second tier cities believe that the price level will not affect their purchase of luxury brands. In the advanced clothing accessories, the second tier cities spend less than 20 thousand yuan per person per year 74.9%, and the population who spend 20 thousand ~10 yuan per year has 23.5%. The annual consumption of 100 thousand ~20 yuan is basically the same as that of the first tier cities.


    Countermeasures: Shang Yang media believes that the traditional concept that Chinese luxury consumers are followers of big LOGO is a misleading person. Many people are no longer so blind. They are no longer limited to luxury goods. Their choice is behind the choice. Identity, social circle and age are the key factors affecting their consumption decisions.


    "Circle" consumption: "what do I buy for my buddies?" this is the motivation for many second line rich people to buy luxury goods. The baptism of Confucianism for thousands of years has made the idea of "Baotuan" deeply rooted. With the Chinese concept of "organization", the consumption of "circle" in luxury consumption has been particularly evident. It is often a person who leads the consumption change of the whole group. Because luxury consumption has only risen rapidly in China in recent years, consumers are not familiar with all kinds of related information, and it can only learn quickly through imitation. For example, bosses in Yixing especially like to buy together, and herd mentality plays a decisive role in their buying process. What they are pursuing is to show their worth through luxury goods, or even to show off their wealth before people. The brand Logo is their best, and the rich and generous handwriting is common.


    Countermeasures: brands need to create a circle through brand clubs, SNS communities, etc., and seize the dissemination of the first person, that is, opinion leaders, and organize activities to attract consumers who have preferences for their brands.


    Heavy experience: Chinese consumers are no longer satisfied with the products themselves, but start to pursue their additional non-material experience enjoyment. Because of the relatively limited access to luxury goods, consumers in second tier cities are more concerned with salesmen's professional advice than in the first tier cities. The 2010 China luxury goods report shows that 43% of the respondents in second tier cities hope to know the history and value of luxury brands through salesmen and improve their understanding of products. China's luxury goods forecasters' data in 2010 also showed that 45% of the entity store consumers believed that the attitude of salesmen had a great impact on their consumption decisions.


    Countermeasures: improve the quality of sales staff, so that the level of service to keep up with consumer demand. Set up luxury online shopping platform, professional shopping consultants can also communicate with consumers online.


    Business type: a survey by Goldman Sachs found that luxury goods are widely used in business gifts. This phenomenon accounts for 28% of the respondents in the first tier cities, up to 36% in the second tier cities, more than 3 times that in Hongkong and Taiwan. Among them, the data in Southern China and West China's second tier cities are more than 38%, ranking first in the country, followed by 36% in Guangzhou. Among the luxury items that are suitable for gifts, one of the most popular clothing accessories and small leather goods is the most popular. 37% of the respondents believe that the price of products such as high-end wallets, scarves, neckties, glasses and so on is appropriate and respectable.


    Strategy: starting from products, big brand products may be more popular.


    Networking: the diversified development of the Internet has become one of the main channels to obtain luxury information. The official website of luxury brands is beyond the traditional print media, and 68% of respondents believe that the best information channel for understanding brand product information. In second tier cities, the figure is as high as 71%. According to the US West Fashion survey, customers in Beijing, Shanghai and Guangzhou account for only about 30% of the consumers who buy the goods on their website, while the remaining 50% come from the second tier coastal cities, and the proportion of inland cities such as Chongqing and Chengdu is also increasing.


    Countermeasures: at present, Armani and other companies begin to sell seasonal goods through official online stores. The Italy YOOX group, which specializes in setting up online stores for luxury brands, has recently landed in China to learn and learn from them.


    [related links]


    Luxury consumer types in second tier cities


    Shang Yang media from the novice / veteran experience, personal needs / social needs, material level / spiritual level and other major dimensions of second tier luxury consumers can be divided into 8 groups, they are: socially armed, personal enjoyment, ambitious, natural aristocratic, contentment and happiness, spiritual recreation, self challenge and spare no effort.


    Socially armed consumers are integrated into the group and are recognized as the ultimate goal of their luxury consumption, so they are not stint at this cost.


    The self satisfied consumers are always optimistic about the future and spend money on luxury goods to bring happiness and satisfaction. They are often the first recipients of new brands or niche brands, and they will be happy to mix them with famous luxury brands. Spending on luxury goods has been climbing step by step, advancing at an extremely fast pace.


    Ambitious consumers are very concerned about brand image and personality, because this shows the group they belong to. Therefore, brand awareness and status are very influential factors.


    Natural aristocratic consumers have a lot of wealth, so buying luxury goods has become commonplace for them. They are very fond of brands, and many of them are keen to collect art or antiques. They regard consumption luxuries as an investment.


    Happy customers are happy with what they can have and are optimistic about the future. They are rational consumers and will not overindulge in luxury consumption.


    For spiritual LOHAS, extravagance is more of a lifestyle than material luxury. Some rare things in life, such as time, health, freedom, leisure, etc., for them, these are real luxuries.


    Many male self challenged consumers do not go to boutique shops to buy clothes, accessories or household accessories, but often their wives, secretaries, personal assistants or lovers. Women's self challenged consumers often go to the forefront of fashion. They go abroad several times each year to catch foreign trends and shop at the same time.


    Spare no effort consumers are very fashionable, and they also equate consumption with luxury and fashion. Their display is more intense. Therefore, they will prefer the design with more obvious brand traces. The classic products or large Logo products are popular among this group. At the same time, they are more inclined to choose products such as bags, shoes and accessories.

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