LV "Led" Luxury Stores Closing Tide, Which Is The Pace Of Reducing Prices?

The overall market penetration of luxury goods in 2015 was only 2% higher than that in 2014, while the 2015 luxury consumption budget was only 1% higher than that in 2014.

Among them, the existing luxury consumers in 2014 will lose 10% in 2015, while the total consumption budget of the existing consumers in 2015 is 11% lower than that in 2014.

It is normal for the brand to make some strategic adjustments according to the market changes, including opening stores and closing stores, especially in recent years, the performance pressure of luxury brands in the mainland of China is increasing.

Some stores do not perform well, too many stores have little effect on performance improvement, instead, they bear more costs, and there are needs to pform traditional stores' sales channels. These are the reasons why luxury brands are closed.

French luxury brand Louis Weedon (LV) closed its exclusive store in Libai square, Guangzhou.

In 2015, many luxury brands adjusted the number of stores in China, or closed or reduced their rents. Did the winter of luxury come true? LV Guangzhou Libai Plaza store opened in 2003, and is the first store opened by LV in Guangzhou.

At present, the company's official website can not find any information about this store.

However, the closure of the shop has aroused heated debate.

It is reported that LV will also close five to six stores in the future.

The source quoted the chief financial officer of LV's LVMH group at a group call conference: "if there are two shops in the second tier cities in China, we may close one of them."

Since 2014, LV has closed its only store in Urumqi and has closed a store in Shenyang and Harbin.

According to LV official, LV has opened 45 stores in 30 cities in the mainland of China.

According to reporters' enquiries, LV has more than 2 stores in the same city, with the exception of Beijing and Shanghai, as well as Hangzhou, Wuhan, Chengdu and Kunming.

The LV insider is not willing to talk more about the closed shop plan. It only emphasizes that the company has completed many new projects in 2015. For example, in March 2015, it opened second "Louis Weedon's homes" with the highest specifications of all commodity categories in Beijing, and opened the Hangzhou lakeside shop in August 2015.

According to the LVMH group's third quarter earnings of the year, the group's income in the third quarter grew by 7%, mainly due to the strong impetus of the European and American markets.

In addition, the growth rate of the Japanese market accelerated, while the growth of Chinese consumers' performance was basically flat.

In the first half of the fiscal year, LVMH group also showed weakness in the Asia Pacific market (except Japan).

The first quarter and two quarter decline were 6% and 5% respectively.

There are rumors that LV will shift its focus from mainland China to other regions, such as Japan and Europe.

In response, LV official said: "China is still one of Louis Weedon's most important markets, which is as important as the Japanese market and the European market."

In fact, it is not the right way to sacrifice a store.

One family.

Since 2014, HugoBoss has closed 7 stores, and Ferragao and Zegna have closed 6 respectively and Burberry closed 4.

In the second half of 2015, Swiss watch brand tigheuya and light luxury brand Coach have been shut down in Hongkong. Zhou Dafu also intends to close 4 stores in 2015. The signing of the rent and rent reduction agreement has already opened up a new round of retail outlet for luxury brands.

Bain's early 2014 research on China's luxury goods market released in early 2015 showed that the mainland China's luxury market for the first time showed negative growth in 2014, and its scale dropped to about 115 billion yuan, down 1% compared with 2013.

Bruno LAN, Bain's global partner, has predicted that luxury brands will continue to adjust their distribution in 2015, including closing discount stores and authorized stores.

In Zhou Ting's view, luxury goods lie in China's "comfortable time to earn money" has gone through many reasons.

First is the change of consumer mindset.

The consumption age of the eye-catching big logo has gone forever. More and more consumers are pursuing a low profile and personality. Luxury consumption appears to be "logo away".

Zhou Ting believes that today's consumers pay more attention to a series of factors, such as design and quality, which are centered on products.

"De Logo" is a prelude to branding, which directly promotes the development of the customized industry.

Zhou Ting said, LV, GUCCI and other brands have begun to practice the concept of Logo two years ago. The new products launched in the past two years have rarely seen a huge brand Logo.

Secondly, the phenomenon of consumption outflow is prominent.

Because the price of domestic luxury goods is often higher than that of foreign countries, even more than doubled, more consumers will choose to buy abroad or sea.

The boom in cross-border e-commerce and luxury shopping shows that Chinese enthusiasm for luxury goods has not disappeared.

FT Chinese network "2015 luxury industry development report" data show that in 2014, the airport duty-free shops, overseas stores and domestic stores became the three major channels for respondents to buy luxury goods.

At the same time, the overseas purchase method is the first choice for consumers to buy luxury goods with the absolute advantage of 56%.

The third is the impact of e-commerce on the physical store.

The luxury brand has always been very cautious about the channel of e-commerce.

But in recent years, there are more and more brands "touching the net".

Zhou Ting said: "the business model of the entire luxury brand is changing, and gradually changing from a single outlet to a store.

We should combine the electricity supplier with the entity store. "

Closed in August 2015.

After the store in Russell street in Tongluowan, tiger Hoya opened the flagship store of Jingdong TAG Heuer in September.

In recent years, luxury brands such as Burberry, Chanel, Coach, Cartire and so on have been developing new channels around the world through self built e-commerce websites or third party e-commerce platforms.

In addition, in order to reverse the difficulties in operation in China, many famous luxury brands, including GUCCI, adjusted their pricing in China in 2015.

In the first half of 2015, Chanel (Chanel) announced that the price of its products in China would be reduced by 20%, while Prada group had cut prices in Asia outside Japan, and Dior's two handbags had been reduced by 10%, and several watches brands had cut their prices by 35%.

In May 2015, when Italy's luxury brand GUCCI announced the start of the "regular seasonal cleaning up inventory activities", it ushered in a large number of consumers, and some stores even queued for 4 hours.

At that time, almost all products were involved in discounts, including some new spring and Summer Edition and limited edition.

In November 18th, reporters visited the GUCCI Gucci store in the shopping mall of Shanghai international financial center. It was discovered that GUCCI had quietly started its second discount sale this year, including 40 percent off bags and 50 percent off shoes.

The shop assistant told reporters that the current discount is open for VIP and can be pickled on the spot. Non VIP customers can also be booked by staff.

Although the shop did not post any "discount" or "discount" words, the number of consumers in the store increased significantly.

Reporters carefully observed that in addition to some non popular styles, some of the more classic GUCCI bag styles also enjoy discounts, such as a new Boston listing in 2015, and the price of the big 40 percent off is around 8000 yuan.

Reporters compared with GUCCI English official website found that the domestic price after the discount is basically the same as the original price of foreign countries.