1.What is the potential for growth in the luxury goods market in China, how does
it compare with markets in Europe and the US?
The luxury goods market in China is experiencing a rapidly developing stage;
there is a huge potential demand in the next five years. We predict that China
will take over Japan to be number one country of luxury goods consumption in
2015. Compared to European and American markets, Chinese consumers’
psychological consumption maturity is relatively low, and tends to
community-oriented luxury consumption. I think show off consumption is the main
characteristics in this market. This trend will last for the next few years.
But not all the consumers like this, some consumers become very rational, they
appreciate the culture, style, design ect of the luxury brands.
2. Is it a similar story in other developing countries?
Yes, this is result of the stage of economic development. Such as, India,
Russia and other countries, Of course, there are some culture differences
between nations, and consumer behavior can also be different.
3. What goods are likely to be most
Lady's leather goods, jewelry, men's watches and garment are the most popular
luxury once. On the one hand, collectivism culture- oriented Chinese consumers
prefer physical luxury goods which can show their social wealth status, on the
other hand the Confucian culture - oriented consumers are more inclined to
purchase high-priced products for themselves, a justification for this
investment was the most important one of luxury consumption motivation.
4. Where is the existing market in China?
Existing market mainly are those private entrepreneurs and elite components
(from single expense amount to see) who were born in the 1960 's, but overall
consumption in China's middle class (white-collar workers, civil servants,
general staff in foreign companies) are the main consumer power, we can not
5.What geographical areas are likely to see expansion?
Top brand layout in First-tier cities has been fixed, the eastern part of the
second and third tier cities currently is rapidly developing, Western cities
(especially the cities with rich resources) will become the future potential
6. How can the luxury goods market benefit
the Chinese economy?
On one hand luxury goods consumption can stimulate domestic demand, help
China's high-end retail industry to become more mature, on the other hand, our
enterprise has a closer example, through the study of Western advanced design
concepts, manufacturing techniques, marketing methods, and so accelerate the
pace of economic growth.
7. Is it a market that is solely reliant
on imported brands?
At the present, Yes, but to different areas, such as the liquor market, of
course a Chinese-led market, but we can see the international luxury brands
also accelerate the expansion of the Chinese dominant industry, while local
Chinese luxury brand development is also very rapidly, especially in clothing,
jewelry, high-end service industry.
8. What's the risk for those international luxury brands operating in the chinese
market? Given the fact that more international brands have been attracted to
China and many of them may not gain a profit as expected?
Risk of Second and third-tier luxury brands in China would be higher,
especially in China's first-tier cities, prime locations of operating costs are
quite high, but the Chinese people brand preference persists in the short run
(only increase unabated), it will take time for the Chinese people to recognize
the brands, This is a big challenge, especially for those with a low profile
for the DNA of the luxury brand. For luxury firms’ sustainable development, it
is important to balance the brand itself features and characteristics of
Chinese luxury market.