What Do the Chinese Ultrarich Want?

on September 11 2012 | in Lifestyle | by | with No Comments

Gucci, wealthy Chinese, Nanjing Road, luxury shopping

To bling or not to bling: in terms of Chinese luxury buying, it turns out, that is not the question.

The only absolute in the equation is that tastes change rapidly on the Chinese mainland. Popular brands and well-known labels are being cast aside in the quest for the most exclusive purchases. As Woman’s World Daily reports, “These consumers are developing discerning tastes and seek the finer things in life: art, expensive wine, exotic travel, understated elegance.”

But even though the number of wealthy Chinese – not to mention, the size of their fortunes – seems to burgeon daily, not everyone is convinced that the domestic luxury market has grown up as quickly as all that.  Paul French of market research firm Mintel, said, “There is this idea that there are all of these sophisticated people out there. Send me some names and addresses of them.…You can’t buy sophistication. It is about a certain level of security and comfort earned over a certain period of time. Here, they are all drinking wine, but it is still either about a faux craving for Western tastes or showing off money.”

McKinsey & Co. projects that China’s luxury market will be comprised of around 5.6 million households by 2015 that can claim annual incomes between $45,000 and $150,000.

But Mary Bergstrom, founder of the Bergstrom Group in Shanghai, believes the new rich have the capacity to develop tastes rapidly. She explained, “The bottom of the pyramid is [composed of] the new entrants. If the top of the pyramid and the middle of the pyramid have already changed directions, the new entrants are not going to follow the old model.”

However, despite this logic, people on the ground are noticing a lag in the refinement of tastes for a majority of Chinese buyers through no fault of their own. “For the last 200 years, all [cultural] things became secondary. When you are starving, you don’t care about such things. It is too hard,” said Matthew Liu, a modern art dealer in Beijing. “Now it [art collecting] is wide open, but they never went through any art education, so they don’t know. I have to tell them, ‘This is Picasso,’ and ‘This is very important.’ When they stumble onto it in my gallery, it is like an electric shock. They want to have it.”

P.T. Black, senior creative director for the online talk show “Thoughtful China” that is produced in Shanghai, sums it up well: “What is the relationship between wealth and power and display and the aspirations that underpin and propel that [aesthetics]? China, for a long time, will continue to be more flashy.”

 

photo credit: 2 dogs

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