Big Brand Stores In China Are Closing Down. China'S Anti-Corruption Influence Is Big.

To succeed in this increasingly frugal environment, big brands need to focus on quality and strive to attract more discerning Chinese consumers.

Well known brands must also understand that most of their sales will take place outside this country, so the flagship store in Beijing and Shanghai will be basically a costly marketing tool.

Foreign media said it is important to understand how important the Chinese consumers are to the global luxury industry in the past 15 years. Just look at what China has done in the past two years to crack down on corruption and luxury consumption to the sales of luxury goods.

According to British media, the president of a well-known Swiss watch company said that before the anti corruption movement, 65 of its 100 watches sold to China.

Nowadays, only 25 of every 100 watches are bought by Chinese.

In 2000, Chinese consumers accounted for less than 2% of the world's luxury consumption. At that time, luxury goods consumers in the world market reached 140 million, spending about 130 billion pounds.

According to Bain's latest world luxury market tracking, by the end of this year, the number of luxury consumers will exceed 350 million, while Chinese will account for more than 30%, and their consumption will reach 230 billion pounds.

Reported that, but in the past two years, Xi Jinping launched a campaign to clean up the Communist Party and the government's rampant corruption phenomenon, this astonishing growth has dropped sharply.

Over the past more than 10 years, luxury goods of some top brands have been favored by businessmen, who bribed Communist Party officials holding heavy weights in economic activities.

In addition to reducing overall purchases, the anti-corruption campaign also changed the way Chinese people buy luxury goods.

Stefano Connelly, general manager of the luxury men's wear brand Connally, said: "since the beginning of this campaign, Chinese buyers have become more and more interested in buying for themselves rather than buying for others."

He added: "they become more demanding and want to know more about what they want to buy, and why they spend money on it."

Reported that this is a big problem for French brandy, Swiss watches and Italy handbags and other products suppliers. In recent years, they have been expanding shop in China.

People in the luxury industry say several global

Big brands have closed their stores in some of the more remote locations in China, and this trend is expected to continue.

Sir Deng Yongqiang said: "Western Luxury Retailing is rapidly declining in China, and I expect more luxury stores will have to close.

The next two to three years will be more painful. "

Deng Yongqiang pointed out that

About 60% of the consumption of luxury goods is now in foreign countries. As skilled consumers are increasingly comparing the prices of goods online, this consumption outflow will accelerate.

The report said that because of the high luxury consumption tax and business in the mainland of China

Increasing and aggressive pricing strategy and other reasons, buying luxury goods in the mainland may be much more expensive than buying the same products in Hongkong, Japan or Europe.

In 2000, most Chinese could not even get a passport, let alone a visa, but now all countries can't wait to attract rich Chinese.

At the same time, global travel has become simpler and cheaper than before.

Analysts pointed out that, under the influence of a lot of foreign tastes, the Chinese changed the habit of flaunting their wealth in a high profile many years ago, but increasingly emphasized low key and quality.

The rapid change in China clearly shows that the days when the global luxury brands have been making light profits in the country for a long time are basically gone.