Comments for Red Luxury http://red-luxury.com Wed, 12 Jun 2013 13:45:50 +0000 hourly 1 http://wordpress.org/?v=3.4 Comment on Exotic Destinations & Top Hotels Now Matter to Chinese Travelers by Red Luxury http://red-luxury.com/2013/06/11/exotic-destinations-and-top-hotels-now-matter-to-chinese-travelers/comment-page-1/#comment-16313 Red Luxury Wed, 12 Jun 2013 13:45:50 +0000 http://red-luxury.com/?p=13799#comment-16313 Yes, you are correct, that is virtually impossible! We've corrected and updated the post. Thanks! Yes, you are correct, that is virtually impossible! We’ve corrected and updated the post. Thanks!

]]> Comment on Exotic Destinations & Top Hotels Now Matter to Chinese Travelers by Sally Dickson http://red-luxury.com/2013/06/11/exotic-destinations-and-top-hotels-now-matter-to-chinese-travelers/comment-page-1/#comment-16305 Sally Dickson Wed, 12 Jun 2013 07:57:27 +0000 http://red-luxury.com/?p=13799#comment-16305 " Instead China’s 700,000 high-net individuals in 2012 (up from 500,000 in 2011) helped fulfill 92 percent of the 83 million outbound trips last year for private reasons." Please can you check these numbers? 92% of 83 million is, I estimate, 76.36 million outbound drips. 76.36 million split between 700,000 individuals is 1090 outbound trips each or approximately 3 flights a day. I am surprised with this amount of flying they even have time to look at their 4* hotels!!! ” Instead China’s 700,000 high-net individuals in 2012 (up from 500,000 in 2011) helped fulfill 92 percent of the 83 million outbound trips last year for private reasons.”

Please can you check these numbers?

92% of 83 million is, I estimate, 76.36 million outbound drips.

76.36 million split between 700,000 individuals is 1090 outbound trips each or approximately 3 flights a day.

I am surprised with this amount of flying they even have time to look at their 4* hotels!!!

]]> Comment on Chinese Tycoon Develops Malls for ‘Undiscovered’ European Brands by Ricardo Ferrer http://red-luxury.com/2013/06/06/chinese-tycoon-develops-malls-for-undiscovered-european-brands/comment-page-1/#comment-16238 Ricardo Ferrer Mon, 10 Jun 2013 15:13:21 +0000 http://red-luxury.com/?p=13693#comment-16238 This could be very good news, or a blessing in disguise. There are now hundreds of malls in construction in China, most of them in the periphery of the cities. This is because the best spots in the canter of the cities are already taken. Because the best spots are taken, if you are a real estet company building a new mall, it’s probably in the outskirts of the city, and because of that, with very little traffic. The big, established brands with teams in China are very aware of this, so they are not looking for retail space in these malls at this moment, they will do so when the traffic arrives, when the city arrives to them due to natural growth. Therefore, real state companies with new malls that are not in the centre of the cities have few options: a) Accept local brands, which will in the future harm the “luxury positioning strategy”, if that could is the plan of the real state company (and it is so in 90% of the cases, as rents-and profits-are higher). b) Leave the mall empty, waiting for the traffic to come in a few years. c) Look for brands that do not have much knowledge of the Chinese market (they can hardly differentiate Shaanxi from Shanxi, as it’s logical from any small brand, whose executives cannot be expected to know the whole world), but being foreign, keep the high positioning image of the –empty- mall. These brands will spend time, money and effort trying to push a brand that is located in the wrong retail malls. Strategy c) is not ideal, for the real estate company, but for sure it beats a) and b). Regarding the brands, as long as they aware of this game, they can also gain from this situation. But from what we see here in China, the ones aware of it are a minority. But as it always happens, in the difficulty lies the opportunity! This could be very good news, or a blessing in disguise.

There are now hundreds of malls in construction in China, most of them in the periphery of the cities. This is because the best spots in the canter of the cities are already taken.
Because the best spots are taken, if you are a real estet company building a new mall, it’s probably in the outskirts of the city, and because of that, with very little traffic.

The big, established brands with teams in China are very aware of this, so they are not looking for retail space in these malls at this moment, they will do so when the traffic arrives, when the city arrives to them due to natural growth.

Therefore, real state companies with new malls that are not in the centre of the cities have few options:
a) Accept local brands, which will in the future harm the “luxury positioning strategy”, if that could is the plan of the real state company (and it is so in 90% of the cases, as rents-and profits-are higher).
b) Leave the mall empty, waiting for the traffic to come in a few years.
c) Look for brands that do not have much knowledge of the Chinese market (they can hardly differentiate Shaanxi from Shanxi, as it’s logical from any small brand, whose executives cannot be expected to know the whole world), but being foreign, keep the high positioning image of the –empty- mall. These brands will spend time, money and effort trying to push a brand that is located in the wrong retail malls.

Strategy c) is not ideal, for the real estate company, but for sure it beats a) and b).

Regarding the brands, as long as they aware of this game, they can also gain from this situation. But from what we see here in China, the ones aware of it are a minority.

But as it always happens, in the difficulty lies the opportunity!

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