Sudden Crisis: Can Luxury Brands Achieve A Perfect "Soft Landing"?

The sudden outbreak has broken many industries' plans to salvage gold during the Spring Festival, and the golden day of the Spring Festival is earlier than usual. The Lunar New Year holiday is supposed to be an important trading node for luxury goods businesses. However, due to the unexpected arrival of the "black swan", shops inside and outside the country are all deserted, with few visitors.

Not only that, the major industries also have to cope with the enormous pressure caused by the loss during the epidemic. Using aircraft to make a metaphor, the luxury market is like an aircraft suddenly turned off the engine, do not know how long the crisis will last, and whether luxury brands can achieve a perfect "soft landing"?

It is not too much to describe the current luxury market with cloud. On February 17th, academician Zhong Nanshan, a department of respiration expert in China, said that the peak of the new crown pneumonia will appear in the middle and late 2 and will not be stable until the end of April. We can see that the impact of the epidemic on luxury goods is continuous and unstable.

In response, many luxury brands have lowered their performance expectations for the 2020 fiscal year, and have taken temporary measures to close stores in China and shorten business hours.

The British luxury brand Burberry group has issued an official statement that it has closed about 1/3 of its Burberry stores in China, while the number of stores still open has dropped by 80% compared with the same period last year. About 2/5 of Burberry's sales came from Chinese consumers, so Burberry also withdrew its annual performance forecast for 2020.

Kai Yun group has closed half of its stores in China, while the remaining stores still open business will shorten business hours and shelve new store activities and advertising. As the epidemic continues to change, it is not possible to fully assess the impact on business and the speed of recovery in the future.

Capri, the parent company of Michael Kors, Versace and Jimmy Choo brands, said they decided to close 150 of its 225 Chinese stores and cut its sales forecast for the quarter by 100 million US dollars.

The impact of the epidemic on luxury brands is not great. China is a very large consumer market, and the market is not as good as expected. The sales performance of luxury goods in January and February is generally bleak. However, many brands still choose to give generously, donate money and donations, showing the responsibility of enterprises in social responsibility.

In January 30th, the Group paid 10 million yuan to the Red Cross Society of Wuhan, and expressed its willingness to work together with the Chinese people and all the people affected by the virus to fight against and overcome the epidemic. In February 4th, Herm s group set up the Chinese Song Qingling Foundation's Hermes White Angel Guardian plan and donated 5 million yuan to the Chinese Song Qingling foundation.

The epidemic will only press the pause button for every industry, and winter will pass away and usher in the spring of hope.