Coach Leads &Nbsp; Second Tier Foreign Brands Become "Fake Luxury Goods" In China.

　 Coach The price difference between China and the United States is about 40%.

Enter the first floor of Beijing Xinguang heaven and earth road. High-grade The smell of cosmetics is coming, and imported luxury brand counters and boutiques are everywhere. Zhao Ping's Coach store, which is known as the foreign consumer goods, is located near a corner of the first floor of the new world. The opposite row is a store of brands such as FENDI and CHANEL. Next to Coach is the DIOR cosmetics counter.

"Some of those bags can be hit thirty percent off, the package is not discounted because it is the new model this year." Coach's shop assistant pointed to a handbag with a price tag of 10500 yuan and a python pattern. On the official website of Coach, the price of the package is 1000 yuan (about 6456 yuan), which is nearly 40% less than that of the domestic market.

According to Coach's salesperson, the price of domestic stores is exactly the same as that of Coach's official website. Reporters access Coach official website found a embossed crocodile pattern Handbag marked on the Chinese official website. Price For 6950 yuan, the price on the English official website is US $598 (about 3861 yuan); the price of another red leather handbag is 3800 yuan in the official website of China, only 298 dollars on the English official website (1924 yuan), and the difference between domestic and foreign prices is nearly 50%.

In the Coach China official website, the lowest price of a handbag is priced at 3800 yuan. In the English website, the lowest priced handbag is priced at only 128 yuan (about 826 yuan). Such a price level can only be regarded as a high and medium consumer goods in China.

All along, the outside world is whether Coach is Luxury goods There is controversy. In the 90s of last century, Coach put forward the concept of "public luxury", positioning the product price to about half of European luxury brands such as LV and PRADA. But in recent years, the price performance and marketing mode of Coach in the Chinese market has become a luxury in the eyes of many Chinese consumers. The situation in foreign countries is not so, but it is still a brand of high-end consumer goods.

Coach says high operating costs in China

On the issue of price difference, Coach spokesperson and Victor Luis, President of Coach international retail business, said that the price difference of foreign brands is a common phenomenon in Chinese market. In fact, there are many reasons for price differences, including spanportation costs, marketing expenses, store opening expenses and store operation costs, which are the factors leading to the inconsistency of Coach products between China and the United States. In addition, "we have been in the United States for 70 years. Coach is the leading brand in the local market, so it is of scale benefit. However, we still do not have these advantages in the international market including China."

Victor Luis said that in the market of China and any other country or region, the price of Coach products is only half the price of European traditional luxury goods, "our benchmark price is lower than that of European luxury brands".

Netizens list ten "fake luxury goods".

It is not uncommon for foreign brands like Coach to enter the Chinese market and become a luxury brand after entering the Chinese market. Among the ten "fake luxury goods" listed by netizens, Coach is the first to bear the brunt, and GAP, LEVIS and other brands are also included.

"A lot of imported brands are cheap in foreign countries. They can buy a T-shirt for $350, but it costs almost 1000 yuan in China. GAP is mass consumer goods abroad, and young people around 20 are the target group. Young people abroad have little money, so it can't be a high-end brand, but GAP is quite high in China. Zhao Ping said.

"These brands belong to the mass brand in the United States, and the Chinese usually buy several take back in the US, and the price in the US is about 50% cheaper than that in China." A Chinese student studying in New York said.

Is high price a luxury?

Why do these foreign brands come into China successfully after they enter China, and a large number of Chinese consumers are willing to pay for them?

"Domestic consumers' cognition of foreign brands is limited, and there is a lack of corresponding understanding of brand reputation and brand positioning. Many are just following the trend. Under such incomplete information, it is possible to mistake some of the two or three line brands abroad as well-known luxury brands." Zhou Ting, deputy director of the luxury research center of University of International Business and Economics, said.

She believes that because of the additional factors such as exchange rate, tariff and spanportation cost, these brands will sell at home more than foreign countries. Faced with such a price, domestic consumers naturally think that the price is high, and they can not afford to buy luxury goods.

At the same time, Zhou Ting acknowledged that the reason why these brands can become a first-rate luxury after entering China lies in the superior product quality and brand image, and the spirit of brand communication and some domestic consumers. "High prices, coupled with superior quality of goods, make these brands available in China."

Zhou Ting said that these brands are comparable in their domestic and Chinese status. However, due to the different consumers, the different needs of consumers, and the different behavioral characteristics of consumers, the market performance in two countries is also normal.

Marketing style than luxury goods

Marketing strategy expert Shang Yang believes that the brand positioning is related to the market and sales situation, and of course, it can not be related to marketing. There is no doubt that Coach has also helped them in the marketing way of China's luxury brand.

"Many Chinese have the consumption psychology of Chongyang, which is one of the reasons why foreign second-line brands can be ranked among the luxury goods in China, and it is also an important factor that makes Chinese local enterprises unable to create luxury brands." Shang Yang said. {page_break}

Why do foreign second-line brands become luxury in China? Ouyang Kun, chief representative of the World Luxury Association, believes that the main reason is the price. It is also related to the per capita monthly income of China's first tier cities. The selling price of foreign brands in China is still high for China's per capita monthly income, and the pressure on Chinese consumers to buy is large. The price of a single piece of goods is greater than the per capita monthly income of the first tier cities in a country.

Ouyang Kun said that Coach was a supermarket product in the United States and opened a store after entering China. These foreign brands can be imported into China after packaging. This also shows that Chinese consumers are immature and have no knowledge of European and American brands. The definition of luxury is too vague.

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Reasons for the absence of luxury goods in China

Chinese brands lack world-class luxury goods, and Moutai is limited to the domestic market. Tea is considered to have potential.

In 2010, the total consumption of China's luxury goods market reached 10 billion 700 million US dollars, accounting for 1/4 of the global share. Only after Japan, it became the second largest consumer of luxury goods. When foreign second-line brands are active in the Chinese market as luxury goods, Chinese local enterprises can only be embarrassed to watch them share the big cake in the Chinese market.

The local brand is in its infancy.

"Tariff reduction will not bring luxury price reduction. The root cause of high price of luxury goods is Importers' pricing power. Chinese local enterprises do not have luxury brands but can only listen to others." A person engaged in duty free business told reporters.

"At present, there have been a group of business people and excellent designers who are committed to developing luxury goods, such as Deng Yongqiang's Shanghai and Guo Pei's Rose House. There are also some good luxuries, such as national liquor Moutai, jewelry, Lao Fengxiang, Zhou Dafu, top Dahongpao tea leaves, but these luxuries have not developed into real luxury brands, and their brand line radiated by multi-level people is not aimed at luxury consumption groups." Zhou Ting, deputy director of the luxury research center of University of International Business and Economics, believes that China's luxury brand is still in its infancy.

"Luxury brands must be rooted in the soil of culture. For example, French wine conveys the romance of the French, and Swiss watches represent the spirit of precision and refinement. If we want to develop local luxury goods, we must also be rooted in our profound cultural heritage. Zhou Ting believes that China does not lack the cultural soil that breeds local luxury brands. It is a long-term process to integrate five thousand years of traditional Chinese elements into the brand.

"The growth of local luxury goods requires a long-term precipitation process, and in the process, many foreign luxury brands have entered into a very good opportunity and development for the growth of our local luxury brands." In addition, Zhou Ting said that the expression of brand positioning LOGO needs to be tested repeatedly to the market.

Tea is considered to be a luxury product.

Ouyang Kun, China's chief representative of the World Luxury Association, believes that there is not a truly Chinese luxury brand that consumers really agree with, but there are several areas that may enter the ranks of luxury goods, such as tea and white jade. High end Moutai can be regarded as the representative of China's luxury brand, but unfortunately, liquor is not like red wine, and many foreigners are not very suitable for liquor taste.

Ouyang Kun said that China's tea is a luxury that can be a luxury. Tea contains Chinese traditional culture, and the process and history of tea art are full of mystery and illusion. Foreigners can adapt and enjoy the taste. Internationally, there are relatively fixed consumers, as well as potential consumer groups. These are the prerequisites for tea to become a luxury in China.