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    China'S Luxury Market Distortions Must Be Understood

    2016/1/21 16:31:00 24

    ChinaLuxury GoodsMarket Quotation

    When the economy slows down, men first discard luxury goods, and female consumers are the most reliable "gold masters".

    [in the 2015 luxury consumption, male supplies were greatly shrinking.

    While women's clothing grew by 10%, jewelry and cosmetics increased by 7% and 5% respectively.

    [Bain company recently released a 2015 annual "China Luxury Market Research Report" that China's luxury market has been declining for second consecutive years.

    Data show that the scale of China's luxury goods market in 2015 was 113 billion yuan, down 2% from the same period last year.

    ]

    Near the new year, Zhao Meng entertained her friends in order to give thanks to each other before giving her a recommendation.

    Zhao Meng's "record" is good this year. Before this stock market crash, he heard his friend's suggestion and quit in time.

    On the day of the meal, she passed IAPM, saw the big sign of GUCCI, and thought about buying a new year gift.

    There were not many guests in the shop, but there were also three to two in the store accompanied by the clerk to see objects.

    The scene was better than what she saw a year ago, when most of the staff in the store had more customers than customers.

    "This may be due to the adjustment of luxury prices in the first half of 2015."

    "If you go to IFC in Lujiazui now, you will find more customers than before," said BrunoLannes, chairman of consumer goods, retail and luxury goods business in Bain, a consultancy.

    In fact, after Chanel took the lead in price adjustment, many brands adjusted their prices in China in a low profile.

    The adjustment of price has helped the Chinese consumers to a certain extent.

    But overall, China's luxury consumption has declined for two consecutive years.

    If luxury brands want to increase their turnover in China, remember that women spend more time on luxury goods than women.

    Bain has recently released a research report on China's luxury market in 2015, saying that China's luxury market has been declining for second consecutive years.

    Data show that the scale of China's luxury goods market in 2015 was 113 billion yuan, down 2% from the same period last year.

    In fact, since the second half of 2015, information on various brands has been coming out.

    According to incomplete statistics, SalvatoreFerragamo has closed its 7 stores in China this year, and HUGOBOSS has closed 11 stores in China.

    "We know that the growth rate of China's luxury goods market has declined in recent years, especially under the influence of the Chinese government's anti-corruption policy."

    PierLuigi, the heir of Italy's luxury brand LoroPiana, is also aware of this phenomenon. He told the first Financial Daily reporter: "fluctuations in the market or finance will indeed cause consumers to have doubts about buying luxury goods in the short term, an obstacle to shopping because of unknown market conditions.

    Recent events have made consumers reluctant to spend too much money on shopping. "

      

    Bruno

    The main reason for the continued weakness of the domestic luxury market is the price difference between the domestic and overseas markets.

    The convenience of overseas tourism and the popularity of the Internet have made Chinese consumers "smart". They are not as good as ten years ago.

    Zhao Meng agrees with this view.

    When shopping in China, impulse spending is mostly and small items are often purchased.

    Most of the time, she still chooses to buy these high-end products on overseas business trips and holidays.

    "There are too many difference prices at home and abroad."

    Most consumers have the same idea as Zhao Meng.

    After studying about 1500 Chinese consumers, Bain found that in 2015, shoppers changed a lot in the choice of luxuries.

    In 2015, the overall increase in overseas luxury shopping was 10%.

    Consumers flocked to Japan to spend more than 200% of their purchases.

    The advantages of exchange rate and competitive luxury pricing make Korea, Europe and Australia become the popular shopping places of Chinese consumers in 2015.

    In contrast, the mainland of China

    Consumer

    Luxury consumption in China's Hongkong and Macao, China has fallen by about 25%.

    On the other hand, insiders believe that in fact, they focus on high-end consumption.

    Luxury brand

    The development of these brands has gone too fast, and these brands have lost their sense of mystery due to overexposure.

    "For us, a city can only open a store, and a city can open 2 to 3 stores. We need to adhere to this standard, and seriously think about where we need to open shops, and how much exposure we need in these places."

    A brand executive told the first Financial Daily reporter.

    "These brands opened too much in the early years.

    Some cities can digest so many stores.

    Li Xueri, founder of the temple Library of the luxury electric business website, also said that the previous good momentum had made mistakes in judging the luxury brands. Some new commercial real estate projects in some inland cities were committed to attract luxury brands to enter, and promised substantial subsidies before opening up.

    "These funds, such as decoration subsidies, are always tens of millions, so that some shops can be opened there, even if there is no business."

    But with the loss of subsidized dividends, luxury goods began to "fail", so there was a wave of closing stores.


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