China’s rapid rise in consumption as well as sophistication has attracted leading fashion brands into the country.
Burberry has announced that it will add 66 stores to the 44 outlets it already has in China by 2012. Another British fashion brand, Vivienne Westwood, will open 20 boutiques in China. Leather goods company, Coach will open 20 outlets in China this year. Italian luxury goods company Ferragamo expects to open 10 stores. It is rumored that Tom Ford, the former creative director of Gucci, is looking for retail spaces in Shanghai.
Jessico Lo, of the China Market Research Group estimated that retail sales in China will grow 16%-18% this year. “Consumers are getting wealthier and shopping more, they remain optimistic about the economy and their own job prospects,” Lo said. “Eighty percent of women told us they would spend more in the next six months than they did in the last six months. Consumers in less famous cities like Chongqing are spending a lot, too.”
Fashion houses are super excited of the sheer number of cities (outside the usual big cities like Shanghai and Beijing) with potential to spend on luxury goods. We are seeing more companies debuting brands and product lines exclusively for the Chinese market. Dior’s Blue collection, which consists of 12 pieces, is made exclusively for the Chinese market and only sold in their Shanghai store.
Some experts caution that luxury companies need to localize their styles and advertising to appeal to the Chinese luxury consumers tastes, which is not necessarily the same as American and European consumers. We concur. While the West has traditionally set the standards for luxury and many Chinese consumers have looked to them to define luxury, Chinese luxury consumers are growing increasingly independent and asserting their preferences as their place in the luxury market solidifies.