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    Chinese Consumers: The Absolute Main Force Supporting Global Luxury Growth

    2012/9/27 14:34:00 9

    Luxury BrandsLeather GoodsClothing

     

    Earlier, luxury brand Burberry made a profit warning, and the market was worried about the prospect of luxury goods.

    However, the interim results announced by PRADA undoubtedly injected a strong heart into the whole market.

    PRADA's performance in the first half of this year showed that its net profit reached 286 million euros, a substantial increase of 59.5% over the same period last year. Sales of various commodities in various regions of the world have increased significantly, especially in the Asia Pacific region, which has become the fastest growing region and the net sales have increased by 44.7%.

    Analysts say Chinese consumers who have super purchasing power are still supporting the world.

    Luxury goods

    The absolute main force of growth.


    Despite the strong growth in PRADA's mid term data, in fact, since mid August, there has been a difference in the performance of luxury brands.

    Some media pointed out that the brand that specializes in manufacturing low price products is suffering from the economic downturn, but the brand growth of the top line is still good. Hermes has raised its sales growth target to 12% in 2012.


    Strong growth in the Asia Pacific Region


    According to the China Daily, growth was achieved in all regions in the first half of the year.

    Asia Pacific Region

    Thriving and becoming the fastest growing region of the company.

    Data show that Asia Pacific market growth and output are all high, net sales of 532 million 500 thousand euros, an increase of 44.7%, accounting for 34.9% of total net sales, an increase of two percentage points over the same period last year.

    It is reported that its growth almost entirely comes from retail channels.

    Media reports said that due to the strong growth in the Asia Pacific region during the period, PRADA CEO Patrizio Bertelli said at the analysts' conference that the target of maintaining double-digit sales growth in the same year is to be maintained throughout the year.


    As the second largest market, net sales in Europe totaled 348 million 700 thousand euros, accounting for 22.9% of total net sales, representing an increase of 39.1% over the same period last year.

    The report shows that the main reason is that the depreciation of the euro has led to sustained growth in the number of tourists.


    In terms of commodity type, sales of leather goods increased by 52%, clothing and

    footwear

    Sales increased by 17% and 14% respectively.

    Geographically, sales in the Asia Pacific region increased by 44%, while in Europe, revenue rose by 31% due to tourist consumption, sales in the Americas rose 30%, and Japan increased by 34%.


    Sales of many luxury brands are weak.


    The reports on the weakness of luxury sales are reported in the newspapers, but luxury professional researchers believe that the luxury market has been divided rather than the slowdown in luxury consumption.

    In fact, since 2012, many high-end brand data in jewelry, clocks, cars, bags and other industries show that China's market performance has begun to show signs of growth decline after years of accelerated growth.


    Reporters learned that luxury brand Burberry grew 18% in the two quarter of this year, compared with an increase of 34% over the past six months.

    Burberry's stock plunged 7% in the London market after its performance, due to the failure of Burberry's performance in the Asia Pacific market.

    Similarly, the "brakes" on the Asia Pacific market results also include the luxury group LVMH, which has seen a slight decline in sales in the first half of this year despite its overall sales growth.


    Expert opinion


    Faye Wong, a researcher at the Cheung Kei luxury Research Center, University of International Business and Economics, told reporters that luxury brands with better brand awareness would be more resilient. "The whole economy is expected to be the main reason for the sale of luxury goods, while seasonal factors are relatively less affected."


    At present, the 25 year old ~40 year old youth has a relatively high level of maturity in luxury consumption. "Because of its overseas experience and high-end consumption experience, plus the fact that they can quickly accept new things, this consumer group is relatively mature."


    Some analysts have pointed out that in the case of slowing economic growth in China, short-term irrational and extrinsic luxury consumption will be restrained.

    At present, luxury brands that are more individualized, have cultural connotations and keep constant values and keep pace with the times can win the favor of Chinese high-end consumers.

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