Home
News
In Focus
Business
Metro
Nation
World
Sports
Feature
Opinion
View more »Opinion Columns
Wan LixinOpinion deputy editor of Shanghai Daily
Forum emphasizes BRI cooperation between China and Arab countries
Rights to lower sleeper berths should be softened by empathy for fellow passengers
Sunday
- Subscribe
Home » Opinion » China Knowledge
Top designers target our taste for fashion
April 6, 2010, Tuesday
|
Print Edition
Print Edition
THE roll-call of fashion designers raising their profile in China over the past few years reads like a Who's Who of contemporary couture, from veteran designer Karl Lagerfeld of Chanel to Miuccia Prada of the fashion house that bears her name to Burberry's creative wunderkind Christopher Bailey.
But looking past the publicity and ribbon-cutting at the ever sleeker, flashier boutiques opening across the country, there's a debate about how much hope the high-end fashion chieftains should be pinning on the economic juggernaut.
China makes up less than 10 percent of the global US$206 billion luxury-goods industry, and even if its share grows in step with the buying power of Chinese consumers, it could take several years before it has a chance of surpassing the sector's more mature markets in the US, Europe and Japan.
That's not to say China isn't highly enticing. Of China's 100 largest cities - which include Beijing, Yantai and Zhanjiang - consumption is expected to double between 2008 and 2015, says a report published last autumn by McKinsey & Company.
The consultancy expects consumption in other cities, including Shanghai, to jump more than 50 percent over the same period. Filling the fashion houses with optimism is that many of those consumers will soon be able to splurge on designer clothes and accessories as McKinsey predicts that the number of wealthy households in China - that is, urban households with annual income of some 250,000 yuan (US$36,600) - will increase from 1.6 million in 2008 to more than four million by 2015.
"Over the years, we have noticed that Chinese consumers have become more discerning about the clothes they wear, the food they eat, the cars they drive, the cosmetics they use, the houses they live in and the furniture they have inside those houses," says Franz Kraatz, senior vice-president of sales and operations at Lane Crawford, a Hong Kong-based department store chain.
It didn't take long for the likes of Chanel, Dior, Gucci and Armani, among others, to open opulent stores in major cities with the same look and feel - and merchandise - as their stores in Paris, Milan, London and New York.
Paris-based LVMH, the world's largest luxury group, has 29 boutiques in 25 Chinese cities, having opened its first store in the country nearly 20 years ago in Beijing. Gucci, of the PPR group, meanwhile, has stores in 23 cities, with five in Beijing and four in Shanghai.
As with other consumer-goods sectors, the learning curve has been steep.
"For a long time, people made the mistake of thinking that China was one place, applying only one strategy and selling the same product whether it was in Shenzhen in the south or Chengdu in the west," says Melvin Chua, founder of Ink Pak, a public relations and events business in Shanghai specializing fashion industry.
"China is filled with different cultures and consumer patterns vary from city to city," says Raphael le Manse de Chermont, executive chairman of Shanghai Tang, a luxury-goods chain with 39 stores world-wide. "Tier-one cities are now entering the experimental luxury phase, putting more emphasis on style, experience and personal enjoyment. Tier-two cities are still in the status-driven phase, paying more attention to brand prominence as well as the brand's price perception."
Even among the tier-one cities, there are discernible differences, he says.
"Shanghai and Beijing are cities where creativity, innovation and courage converge. Their social circle welcomes new ideas with an international sense. They are thrilled by buzz and want to be proud of their knowledge and sophistication in front of peers," he says. "Guangzhou, on the other hand, looks for cues on style from Hong Kong. Hangzhou consumers enjoy uniqueness and freshness. Where new ideas fail in other cities, they might succeed in Hangzhou because of a willingness to experiment."
Understanding where to sell their luxury goods is one thing; understanding who will buy those goods is another.
In particular, the changing spending power of China's female shoppers is being scrutinized as never before. "Chinese women follow trends just as closely as women in New York or Tokyo," says Cao Weiming, managing director of Conde Nast China, which began publishing Vogue China five years ago.
"At Vogue, we target both the successful career women and new socialites, who can buy designer clothes every month or week and for whom money is not a problem, and the young women who have just started working and are interested in fashion."
A recent Forbes.com article cites research from US-based consultancy Pao Principle, which found that the average female Chinese luxury consumer spends roughly 11 percent of her income on luxury handbags alone.
Pao Principle found that the average shopper has an annual income of 125,000 yuan - more than three times the average salary earned in Shanghai - and bought two US$1,000 handbags. In contrast, female shoppers in the US making US$150,000 or more annually spend about US$3,000 a year on handbags.
(Reproduced with permission from Knowledge@Wharton, http://www.knowledgeatwharton.com.cn. All rights reserved. Shanghai Daily condensed the article.)
But looking past the publicity and ribbon-cutting at the ever sleeker, flashier boutiques opening across the country, there's a debate about how much hope the high-end fashion chieftains should be pinning on the economic juggernaut.
China makes up less than 10 percent of the global US$206 billion luxury-goods industry, and even if its share grows in step with the buying power of Chinese consumers, it could take several years before it has a chance of surpassing the sector's more mature markets in the US, Europe and Japan.
That's not to say China isn't highly enticing. Of China's 100 largest cities - which include Beijing, Yantai and Zhanjiang - consumption is expected to double between 2008 and 2015, says a report published last autumn by McKinsey & Company.
The consultancy expects consumption in other cities, including Shanghai, to jump more than 50 percent over the same period. Filling the fashion houses with optimism is that many of those consumers will soon be able to splurge on designer clothes and accessories as McKinsey predicts that the number of wealthy households in China - that is, urban households with annual income of some 250,000 yuan (US$36,600) - will increase from 1.6 million in 2008 to more than four million by 2015.
"Over the years, we have noticed that Chinese consumers have become more discerning about the clothes they wear, the food they eat, the cars they drive, the cosmetics they use, the houses they live in and the furniture they have inside those houses," says Franz Kraatz, senior vice-president of sales and operations at Lane Crawford, a Hong Kong-based department store chain.
It didn't take long for the likes of Chanel, Dior, Gucci and Armani, among others, to open opulent stores in major cities with the same look and feel - and merchandise - as their stores in Paris, Milan, London and New York.
Paris-based LVMH, the world's largest luxury group, has 29 boutiques in 25 Chinese cities, having opened its first store in the country nearly 20 years ago in Beijing. Gucci, of the PPR group, meanwhile, has stores in 23 cities, with five in Beijing and four in Shanghai.
As with other consumer-goods sectors, the learning curve has been steep.
"For a long time, people made the mistake of thinking that China was one place, applying only one strategy and selling the same product whether it was in Shenzhen in the south or Chengdu in the west," says Melvin Chua, founder of Ink Pak, a public relations and events business in Shanghai specializing fashion industry.
"China is filled with different cultures and consumer patterns vary from city to city," says Raphael le Manse de Chermont, executive chairman of Shanghai Tang, a luxury-goods chain with 39 stores world-wide. "Tier-one cities are now entering the experimental luxury phase, putting more emphasis on style, experience and personal enjoyment. Tier-two cities are still in the status-driven phase, paying more attention to brand prominence as well as the brand's price perception."
Even among the tier-one cities, there are discernible differences, he says.
"Shanghai and Beijing are cities where creativity, innovation and courage converge. Their social circle welcomes new ideas with an international sense. They are thrilled by buzz and want to be proud of their knowledge and sophistication in front of peers," he says. "Guangzhou, on the other hand, looks for cues on style from Hong Kong. Hangzhou consumers enjoy uniqueness and freshness. Where new ideas fail in other cities, they might succeed in Hangzhou because of a willingness to experiment."
Understanding where to sell their luxury goods is one thing; understanding who will buy those goods is another.
In particular, the changing spending power of China's female shoppers is being scrutinized as never before. "Chinese women follow trends just as closely as women in New York or Tokyo," says Cao Weiming, managing director of Conde Nast China, which began publishing Vogue China five years ago.
"At Vogue, we target both the successful career women and new socialites, who can buy designer clothes every month or week and for whom money is not a problem, and the young women who have just started working and are interested in fashion."
A recent Forbes.com article cites research from US-based consultancy Pao Principle, which found that the average female Chinese luxury consumer spends roughly 11 percent of her income on luxury handbags alone.
Pao Principle found that the average shopper has an annual income of 125,000 yuan - more than three times the average salary earned in Shanghai - and bought two US$1,000 handbags. In contrast, female shoppers in the US making US$150,000 or more annually spend about US$3,000 a year on handbags.
(Reproduced with permission from Knowledge@Wharton, http://www.knowledgeatwharton.com.cn. All rights reserved. Shanghai Daily condensed the article.)
- About Us
- |
- Terms of Use
- |
-
RSS - |
- Privacy Policy
- |
- Contact Us
- |
- Shanghai Call Center: 962288
- |
- Tip-off hotline: 52920043
- 沪ICP证：沪ICP备05050403号-1
- |
- 互联网新闻信息服务许可证：31120180004
- |
- 网络视听许可证：0909346
- |
- 广播电视节目制作许可证：沪字第354号
- |
- 增值电信业务经营许可证：沪B2-20120012
Copyright © 1999- Shanghai Daily. All rights reserved.Preferably viewed with Internet Explorer 8 or newer browsers.
