Chloé looks to gain a larger share of China’s plump $15 billion luxury goods market through attracting younger fashionistas to aspire to own one of its handbags for 13,000 yuan to 15,000 yuan ($2,000 to $2,300), chiffon skirts for about 10,000 yuan, and black leather ballet flats for 3,500 yuan.
After marking its fifth year in China, Richemont-owned Chloé sees China becoming its No.1 market within the next two years.
Adding to its nine existing stores, the company will add four new stores this year and expects to reach 23 stores by 2015, said Geoffroy de-la-Bourdonnaye, Chloé’s president and chief executive.
Despite fewer stores, China would overtake Japan where the French fashion label has 40 stores. Chloé’s China revenues more than doubled last year.
Chloé jetted in k-pop sensation the Wonder Girls to attend its 5th anniversary celebrations at the Shanghai Expo Center on February 25th. The Wonder Girls wore outfits from Chloé’s 2011 Spring/Summer collection.
Chloé also commemorated by streaming a live webcast of its 2011 fashion runway show on a special Chinese-language blog plus a series of interactive activities through its event website.
Last Friday’s runway show featured celebrity Chinese model Bonnie Chen in pleated chiffon skirts and black leather ballet flats. Other celebrities in the house included actress Zhou Yun, who starred in Let the Bullets Fly.
Online brand building is a major part of Chloé’s China strategy.
According to McKinsey & Co., 26% of China’s high-end women shoppers visit websites of luxury brands before they make any online or offline purchases, compared to 15% of male shoppers. About a fifth of Chinese female luxury buyers read reviews before splurging on luxury goods. This compares to 11% for their male counterparts.
So far, foreign luxury brands have a tiny presence online compared to online retail giants like Taobao.com. Luxury companies will accelerate plans to build their presence on China’s web this year.
It is a smart strategy considering they can grow in cities where access to luxury goods remains limited and the costs to reach these affluent consumers are much lower than building stores. Some of the challenges facing the growing Chinese market are rising labor and property costs.
Chloé e-commerce presence is still about 18 months away, but it follows the footsteps of other luxury companies like Emporio Armani and Gucci who announced their online strategy late last year.
Brands understand China’s supremacy on the luxury stage. “China isn’t just catching up with the world, it’s leading it,” said Mr. de-la-Bourdonnaye.
China is poised to become the world’s largest market for luxury goods by 2020 with sales estimated to exceed $100 billion, according to investment-research group CLSA Asia-Pacific Markets.
Chloé’s parent Richemont owns a portfolio of luxury brands including Baume & Mercier, Cartier and Shanghai Tang.
photo credit: chloe