Who Will Be The Next Big Luxury Brand After Chanel'S Price Cut?

senior Watch market Sales continued to slump

Under the influence of China's anti-corruption and Hongkong's market weakness, the famous watch maker Tag Heuer Heuer Watch Company said that the brand had already cleaned many executives at the end of 2014, and planned to cut prices in China, Switzerland and the United States at the same time, of which Hongkong lowered 13% and the mainland China lowered 8%.

Over the past two years, China's high-end watches market Shrinking rapidly. The import of high-end watches in China reached a historical peak in 2011 and 2012, but the situation began to turn downward in 2013. In 2013, China's high-end watches imports fell by 89%, to just $653 million, or 4 billion 70 million yuan, to 9 years ago. Imports of high-end watches also dropped by 88%, and China imported only about 100 thousand high-end watches throughout the year.

The Heuer Watch is not the first high-end watch brand to take a price cut strategy. As early as January 2014, the price list of the LVHM group was reduced by 15%, which directly realized the same price in the mainland of Hongkong. In February 2015, another Swiss brand Patek Philippe announced a sharp price cut in Hongkong, China, with a maximum decline of 22%.

The continued downturn in the performance of the premium watch market will lead to more inventory clearance, discount sales and even overall price cuts.

More consumers are shunned after Gucci raises prices.

Under the backdrop of the industry as a whole, Gucci (Gucci) is also unable to bear. Gucci remained weak in the fourth quarter of 2014 and its revenue declined for two consecutive years. Kai Yun group (Kering) annual profit fell 4.4%.

The head of the Swiss luxury speculation Fund said that some brands had been saturated in the Asian market and produced an aesthetic fatigue. Since the slow recovery of the global economy in 2012, the slowdown in China's economy and the government's anti-corruption have led to a sharp slowdown in the growth of the luxury goods market. The recent geopolitical crisis in Ukraine, the Middle East and Hongkong's "occupy the middle" movement have made the luxury market worse.

Analysts and investors have been critical of Gucci Gucci's lack of innovation, too many accessories, too much average price and rapid price increases. They also said, "Gucci's sales and profits basically rely on low price products, luxury goods market can be selective too big now, high priced products will only attract a small number of consumers, but it will drive away more consumers."

Over the past 4-5 years, Gucci has increased its total price by more than 40%, which has also prevented many consumers from evade. Gucci may have to rely on cheaper products to increase sales.

　　 Prada The worst report card after the listing.

Prada group (Prada) released its 2014 fiscal year financial report, its profit decreased by 27.6% compared with last year, and Prada delivered the worst report card after the listing. The decline in sales was mainly caused by the retail strategy in the US and Europe, but the growth of the number of Chinese consumers in the Asia Pacific region increased. However, sales growth in Japan, the Americas and the Middle East failed to offset the decline in sales in Europe and the Asia Pacific region.

In the autumn and winter of 2014, Gucci and Prada both increased the sale of small handbags. The small handbags were about 20% less than the medium handbags, and the price difference was about 50% for the larger size handbags. For example, the small Gucci Swing Leather Tote Bag official website sells for 1100 US dollars, and the medium-sized size is 1350 US dollars. However, even the small Gucci Swing Leather Tote Bag is almost 3 times the price of the same Michael Kors dual use package, while Michael Kors is a large size! It can be imagined that most consumers will extend their wallet to which brand.

Industry insiders say the luxury market is becoming harder and harder to compete in the retail environment. Gucci, Gucci, Prada (Prada), Louis Weedon Louis (Vuitton) and Hermes (Hermes) and other traditional brands have no room to raise the price, that is, the price of luxury goods has bottomed out. The end of the good era of selling prices through the increase in price, luxury brands must lower prices in order to win more consumers to boost sales.