Global Luxury Market Is Bleak &Nbsp; Asia'S Luxury Market Is Rising.

For a long time, luxury.

In June 24th, Italy fashion brand Prada (Prada) raised a total of HK $16 billion 700 million (US $2 billion 150 million) in Hongkong's initial public offering (IPO).

Prada's listing in Hongkong shows that more luxury brands are turning their vision to the Asian market, especially China.

China has become the second largest consumer of luxury goods in the world.

It is predicted that in 2012, when Japan will surpass Japan as the world's largest consumer of luxury goods, luxury enterprises will become increasingly complicated from their attitude towards the Chinese market. However, no matter what, today, no luxury brand can afford to ignore the consequences of the Chinese market.

It is the most widespread and controversial event in the history of luxury goods that luxury goods are separated from the noble European lineage and accept the Asian gene.

Love hate China market

For a long time, luxury brands have two attitudes towards China: one is love and hate, the other is disregard.

The former is represented by luxury brands such as Buberry, LV and Gucci. On the one hand, they are made in China. On the one hand, they are afraid to admit that they will have a negative impact on their European ancestry. At the same time, they are also drooling over China's vast market.

Most luxury goods have not yet fully entered China. Most of them think that the Chinese consumption ability and consumption concept are still not mature enough. How much sales can be generated is doubtful. Once the brand status is slipped, the loss will be heavy. Therefore, we should adopt a cautious or even disregard for the Chinese market.

But now these two ideas are not working.

Over the past 5 years, China has become a new force in the world and has become the third largest luxury market in the world. Recently, it has jumped second over Japan. Moreover, after the global financial crisis in 2008, China's new rich consumers rescued many luxury brands struggling to go bankrupt with huge purchasing power and created huge consumption of luxury goods.

All these make luxury brands have to rethink: how should they treat the rising Chinese market? Is it wise to extrate Europe from Asia to Asia?

No matter how the luxury brands are in a dilemma, they have entered China in the past three years. Their tentacles not only spread across China's first tier cities, but also have penetrated into the two or three tier cities in China.

At the same time, luxury brands begin to "Sinicization" to varying degrees. For example, Hermes has developed a Chinese concept brand "up and down", and many brands are willing to design products of Chinese concept for China's new rich consumers.

In addition, Chinese capital is increasingly entering the luxury sector, including the acquisition of luxury brand equity, a large number of luxury goods and Hongkong listing.

Capital strength will help the luxury enterprises to further the Chinese market.

The global luxury market is bleak and the Asian luxury market is rising.

The "off Europe entry" of luxury goods is in the background of the global luxury market downturn and the emergence of a sudden rise in the Asian luxury market.

Since 2005, the world luxury market has entered a rapid expansion period and reached its peak in 2007, when the total sales of luxury goods in the world amounted to about 170 billion euros.

But with the outbreak of the US financial crisis in late 2008 and its negative impact on the global economy, luxury sales began to decline in 2008.

In 2009, global sales of luxury goods were 153 billion euros, down 8% from the previous year.

Apart from the Asia Pacific market, the luxury market has declined to varying degrees.

Due to the heavy blow of the financial crisis to the real economy, the demand for luxury goods in traditional markets in Europe, America and Japan has declined significantly, which has directly led to the weakness of the global luxury market.

In 2009, the sale of luxury goods in the Americas market dropped by 16%, the European market dropped by 8.5%, the Japanese market dropped by 10%, the Asia Pacific market grew by 10%, and the other markets increased by 1%.

Meanwhile, sales of luxury goods showed a downward trend.

In 2009, from high-end watches to clothing, luxury goods industry was affected by the crisis, and sales declined.

From the product category, high-end clothing decreased by 10.5%; perfume and cosmetics decreased by 4.5%; accessories products dropped by 1.5%; others dropped by 17%.

The financial crisis has had a great impact on the fashion luxury industry.

Looking at the world, France's biggest luxury group, Lu Wei Ming Xuan, lost its profits. Christine Lacroix declared bankruptcy. Germany's two heavyweight luxury brand, Boss Hu Ge, expanded its losses, and the SCADA group filed for bankruptcy protection.

Italy fashion giant Versace has closed its stores in Japan. Prada and Chanel announced 10% layoffs. Luxury industry has gone through nightmares, turnover, profit margins, spending cuts, layoffs, debt ridden, on the brink of bankruptcy, mergers and acquisitions, reshuffle...

However, "the East is not bright and the west is bright", the emerging market economy has led the global economic recovery in the post crisis era, especially the rise of the Asian luxury market has brought warmth to the whole industry.

Contrasting with the cold market in Europe and the United States, Asians who are "not bad money" have reached a near paranoid degree of luxury fever.

World Bank Wei Lishi released the 2010 "retail industry globalization process" report. In the total revenue of LVMH in 2009, the Asian market (excluding Japan) took the lead in 28%, of which the Chinese market contributed most. LVMH's revenues in Europe, the United States, Japan and France accounted for 21%, 18%, 18% and 18% of the total revenue, respectively. Asia has become the largest market in the world of LVMH.

Emerging Asian markets are becoming their first choice for luxury retailers who want to expand globally.

Chinese consumption of explosions

In the Asian market, China highlights stronger consumption power, and China's luxury consumption has seen explosive growth and alarming growth.

At the same time, because China is in the stage of expanding consumption and upgrading consumption, more luxury brands should not miss a pot of gold in this market.

The world has experienced a financial crisis, but China is the only country with a positive growth in the luxury market, a growing market.

In the 2008 chart of the global luxury market, the Chinese market accounted for 10% of the total value of US $27 billion, of which the mainland market was US $15 billion, accounting for 5.5% of the global market.

Lu Xiao, assistant professor of fashion and luxury management, assistant professor of management at Fudan University, and director of Fudan - Bo Ke Ni fashion and luxury management project, said that the Chinese luxury industry will grow by 15% this year. In addition, Macao, Hongkong and Taiwan will probably account for 20% to 25% of the global luxury market in the next five or six years.

That is to say, the purchase volume will be "not too bad" with the Japanese market.

By the end of March 2011, the total consumption of luxury goods in mainland China had reached $10 billion 700 million (excluding private aircraft, yachts and luxury cars), occupying 1/4 of the global market share.

Among them, jewelry market 2 billion 760 million, luggage 2 billion 510 million, fashion 1 billion 830 million, clocks 1 billion 940 million, cosmetics 970 million, other fields 7.8 billion, accounting for 27.5% of the global total.

China has become the fastest growing country of luxury consumption in the world, and is expected to surpass the United States in 2012 to occupy the leading place in the world's luxury consumption.

Bain's research shows that in order to cope with the rapid growth trend of the market, the major luxury brands have maintained a radical expansion in China.

In 2009~2010, the major luxury brands also made a lot of money in China.

There are several characteristics of China's luxury market.

The number of new rich consumers is large and showing a younger trend. The two or three line market has become a new battleground for luxury brands to fight, and overseas consumption is hotter.

At present, China is in an important stage of expanding consumption and upgrading consumption.

China's rich class is at a stage of rapid increase in luxury consumption.

Therefore, for many luxury goods, the Chinese market means more opportunities.

Consumption of luxury goods in China

In the process of Sinicization of luxury brands, we may encounter the risk of declining brand status and weakening core values, but the trend of extravagance of luxury goods is a rare opportunity for China's related industry chain enterprises.

Because of the high import tariff of luxury goods in China, the sale price of luxury goods in China is generally one third higher than that in origin. This is a major problem leading to the relocation of luxury goods in China.

According to China's per capita GDP of over 3000 US dollars, China is in an important stage of expanding consumption and upgrading consumption, especially in the rich class. There is a rapid expansion of demand for luxury goods. Therefore, it is crucial for China to adjust and reduce the tax rate of luxury goods and keep most of its purchasing power in China.

Domestic luxury consumption can effectively drive the development of high-end industries.

Ouyang Kun, an analyst with the World Luxury Association, believes that luxury consumption can fully stimulate the consumption of the mainland and drive the development of the industry.

Successful luxury business can drive the regional economy of the city and form a high-end industrial chain. The development of the high-end regional economy is the core of the achievement of the city CBD and the city image.

Luxury image can promote the city's international business card, and also can promote the consumption growth of the high-end industrial chain in the city.

Therefore, enterprises in China's high-end industry chain should also seize the opportunity, and constantly enhance their competitiveness with the luxury goods "leaving Europe and Asia".