Luxury: A New Buyer Of High-End Market

According to McKinsey report, by 2015, China will become the largest in the world.

China's economic growth has provided a huge market for luxury industries.

The volume of the market has not been fully revealed yet, which has been coveted by many luxury companies.

According to the market survey conducted by KPMG at the end of 2010 in China, 44% of the respondents (middle class) are expected to maintain or increase the consumption level of luxury goods.

Meanwhile, 38% of the respondents are cautiously optimistic about the future, but they still show that they will not give up to reward themselves or improve their status.

Consumption presents polarization

The consumer market is polarizing, showing two trends: low consumption and high consumption.

One side,

Why do consumers pursue high prices? Because they want to prove that "I am a smart shopper" - I will choose the most noble life, which should be reflected in high quality products, cutting-edge technology, fashion style and profound cultural connotations.

Why do consumers pursue low prices? They also want to prove that "I am a smart shopper" - shopping and consumption have become indispensable skills such as driving or using computers, and buying products with high cost performance is worth showing off.

All this has an important premise that the products purchased are quite mature, and the quality and function are not very different.

The formation of these two trends is not simply the result of the polarization of the rich and the poor, but rather the result of the polarization between the rich and the poor.

In this regard, Cai Ming, general manager of Dong Rong (China) Co., Ltd. believes that at present, Chinese consumers are more interested in luxury goods than their curiosity about brand awareness, followed by the consumption needs of curiosity.

Since the planned economy to the development of market economy in China, the rapid development of 30 years has produced personal wealth values, while the time that international brands enter the domestic market is relatively limited. The social form of China is different from that of other countries. The level of our social hierarchy is not obvious, so that there are great differences in terms of consumption level and consumption ability.

At the same time, because the price of Chinese property is too high and the number of middle consumers is getting smaller and smaller, the luxury brands are not winning by quantity, they are winning by price. Only in this way can they survive. In the face of domestic situation, the middle-level consumer groups will gradually disappear.

Chinese clothing culture has a long history, but it failed to create an international brand. The lack of its brand culture is closely related to the way of Chinese historical and cultural pmission and the unclear level of social hierarchy.

In the future, we should probe into the new way of internationalization development of Chinese fashion apparel brand, the deep operation mode and the international brand Centennial culture construction.

Cai Ming pointed out that the Chinese luxury consumption class is turning to a more mature trend, whether psychological or behavioral.

This is mainly reflected in two points, first of all, on the cognitive side, customers do not blindly pursue luxury goods, but more focus on the traceability of product culture; secondly, behavior, that is, purchasing power, its starting point will be concentrated on the collection, the study of brand values, in general, can be said to be a great leap forward, but also a qualitative improvement.

The luxury market continues to expand

The operation direction of the big luxury brands in the Chinese market will be gradually radiated from the high-end market to the one or two and three types of markets. The main focus of the market is to guide the spread of brand culture, and the two or three types of markets are mainly the extension of the value of the product series.

After the shadow of 2009, the whole luxury industry finally reproduced yesterday's brilliance under the help of the revival of the economic environment.

The luxury market will continue to look good in 2011, but analysts expect growth to be relatively moderate, with a growth rate of about 4% to 5%.

After building a super shopping mall and eventually having a debt crisis, Dubai had to bow to defeat.

Unexpectedly, China has become a big winner.

Since the beginning of 2010, China's booming development has not disappointed analysts.

Hermes launched the "ShangXia" brand specially designed for the Chinese market in September, marking the importance of the market.

There is no doubt that other famous brands will follow suit.

On the other hand, Italy Prada has publicly stated that it plans to select Hongkong as a listing place in several financial markets such as Milan and London.

China has vast territory and abundant resources, and its development opportunities are everywhere.

But in the past ten months, luxury industries are looking at two places, Beijing and Shanghai.

In just a few months, many stores opened one after another.

Hermes, Tod 's, LouisVuitton, Cartier, SalvatoreFerragamo, Zegna, the flagship store just opened here, and there is another super large store in the modern shopping center.

These brands are competing to create a new look for the Chinese metropolis.

Cai Ming said that the characteristics of luxury goods in China in recent years can be summed up as "site competition", among which the competing luxury brands once tried to establish their status by acquiring sites as soon as possible.

As of today, the operation direction of the major luxury brands in the Chinese market will be gradually radiated from the high-end market to the one or two and the three markets. The main focus of the market will be the propaganda of brand culture, while the two or three type of market will be the extension of the value of the product series.

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In fact, the battle will continue.

Most groups want to grow again through the form of exclusive stores, whether they are self operated shops, cooperative stores or franchise stores, the key is to be able to shine their brand neon on the street.

In 2010, many brands announced that they will open new stores (LouisVuitton, BottegaVeneta, Gucci, Versace, etc.) and renovated stores (ChristianDior, Chanel, etc.) in 2011, and investment will continue to be concentrated in developing sales networks.

LouisVuitton achieved a record high in 2010. Its sales exceeded 20 billion euros for the first time, and its net profit for the first time exceeded 3 billion euros; the peak sales group increased 37% to 3 billion 259 million euros in the first half of 2010/2011, while Tod 's increased 4.2% to 377 billion 500 million euros in the first half of 2010, Hermes increased 20% to 1 billion 70 million euro in the first half of 2010, Prada increased 31% to 1 billion 386 million euros in nine months before 2010, and the turnover of luxury group in 2010 has grown in all the markets worldwide.

In North America, Western Europe and Eastern Europe, especially in the highly competitive Asian market (excluding Japan) and the Middle East market, it has the best performance.

Extended reading

Evolution of luxury in Hangzhou

In 1999, HUGOBOSS opened its first store in Hangzhou's Grand National Street. Its store was not large, but for Hangzhou people who were still proud of wearing Montagut, HUGOBOSS's 10000 yuan suit was the first time that Hangzhou people saw what luxury was.

Everything changed with the advent of LV.

In November 19, 2004, the LV brown suitcase appeared in Hangzhou Tower and became a landmark event of luxury brands stationed in Hangzhou city.

At the beginning of the opening of the counter, the Hangzhou Tower LV store has achieved an amazing sale of over 4 yuan in sales for more than 400 thousand yuan.

As the world's number one luxury brand, LV's long-awaited effect led to the rush of big brands to enter Hangzhou. Subsequently, a series of big brands such as Celine, Burberry and Ferragamo settled in Hangzhou Tower.

In 2005, the famous brand Dolce&Gabbana of lakeside international fame Street opened in Italy. The far sighted big card didn't even choose street shops at that time, but it has been in the central position of famous street around four sides.

Of course, when many consumers who are still in the stage of illiteracy are still thinking about the relationship between Dolce&Gabbana and D&G, its sales are already quite hot, and sales volume has been maintained throughout the famous street.

Followed by the opening of GiorgioArmani and the appearance of Hermes in famous street in 2006.

In a short span of two years, Hangzhou has greeted the most famous batch of famous brands in the world.

With the opening of Chanel at Hangzhou Tower, it can be regarded as the end of the first movement of luxury goods.

At the end of 2009, just next door to LV Hangzhou Tower, Chanel opened its first store in Hangzhou. Since its opening, it has been doing quite well.

For Hangzhou's luxury territory, 2010 is another year with a turning point.

Hangzhou's first SHOPPINGMALL the Mixc is opening up. A large number of luxury brands have been gathered in the commercial giant. These big brands account for nearly 20 thousand square meters.

After the Hangzhou Tower and lakeside international famous street, the Mixc has become another gathering place for luxury goods in Hangzhou.

The opening of the Mixc also opened the second spring of luxury luxury brand expansion in Hangzhou.

With the full launch of the Mixc, LV, Cartire and Dior have opened second stores in Hangzhou.

MontBlanc also opened a new celebration in Hangzhou in January 7, 2010 for the new store in the Mixc and the old Hangzhou Tower.

Watches and jewellery group began to focus on the image of the expansion movement, OMEGA counters changed shop, business has been the first in the country, Vacheron Constantin in 2010 also changed the Hangzhou Tower counters to stores, after sales quite prosperous, once in a broken state.

At the same time, the opening of lakeside international famous street has brought Hangzhou's "3 store effect" to many brands. The most typical example is that LV has opened 3 stores in just a few kilometers, and only Hangzhou has such ability to absorb gold.