Those inside the luxury fashion industry know that established brands are losing their connection with the next wave of Chinese consumers.
Designer Davy Ye summed up the feelings many now have about brands like Louis Vuiton, Versace, Hugo Boss, Gucci, and Omega when he said, “Although these luxury brands have been admired by some Chinese people, to others, like me, they are somewhat synonymous with parvenu – a rich second-generation, or of graft-taking and bribery bureaucrats in China.”
Top and low-key premiums and emerging luxuries will see a boom in key cities, while mass premium brands will continue to grow in second- and third-tier cities, according to Zhou Ting, executive director of the research center for luxury goods and service of University of International Business and Economics.
The international brands that have been attracting the most attention (and sales) lately are niche brands and emerging brands.
“More and more rich Chinese are seeking top luxury brands that have long history, top prices and a low-key manner,” said Rupert Hoogewerf, chairman and chief researcher of Hurun Research Institute, which puts together the annual Hurun Rich List.
Italy-based Silvano Lattanzi, specializing in made-to-order shoes, is attracting serious celebrity attention. Both Barack Obama and Uma Thurman are customers. Shoes start at $7,440 and the shoemaking process involves complicated measurements and several fittings. There is no logo on the shoes, and customers who have ordered 20 pairs can have their name carved into shoes.
Global emerging brands and independent designers are picking up a following as well.
Jiang Bingyu, a business magazine editor, was attracted to the handbag brand Bree for its its simple and practical design, soft leather fabric and rich colors. Jiang said that the overseas travel helps many Chinese people know more about foreign brands and become more sophisticated in their shopping. Her own trips to Germany have helped her learn about brands like Marc O’Polo and Joop.
Innovative brands like Dyson, creator of no-blade fans and multi-use vacuums, are being picked up by international luxury distribution groups to help these emerging brands network in new markets.
Individualism is becoming a big priority for Chinese consumers. “LV and Gucci are brands fit for my mom and father. With a salary of 15,000 yuan, I don’t want to spend a whole month’s pay or even more to get a bag used by people all over the world,” Jiang said.
photo credit: joop, silvano lattanzi