FOR IMMEDIATE RELEASE
BAIN & COMPANY FINDS THAT CHINESE SHOPPERS SURPASS UNITED STATES AS WORLD’S TOP LUXURY GOODS SPENDER
Chinese Shoppers Represent 25 Percent of World’s Luxury Goods Spending, Versus 20 Percent By U.S. Shoppers
Shanghai, December 12, 2012 – While luxury sales luxury sales in Greater China will cool by an additional two percentage points from eight to six percent in 2012, measured in Renminbi, top brands continue to outperform, and as Chinese shoppers’ tastes continue to evolve; these and other findings released today by Bain & Company, the leading advisor to the global luxury goods industry, in the Fifth Edition of its industry bellwether “Luxury Goods China Market Study,” which was unveiled at a press conference in Shanghai. Chinese shoppers have become a core segment of the luxury market, a weaker Euro and better prices have pushed them to make 60 percent of their total luxury purchases abroad, according to Bain’s latest data. The impact of Chinese spending in other markets now makes the Chinese consumer the top spender in luxury worldwide; 25 percent of luxury purchases globally are now made by Chinese shoppers. While luxury spending in China experiences a slightly slower growth rate, it has grown by 37 percent abroad in 2012. Among Chinese shoppers, Louis Vuitton, Chanel, and Gucci remain in the position of top brands, according to Bain’s research, which includes a survey of over 4,600 consumers.
“The Chinese consumer has increasingly become a global consumer for luxury brands,” said Bruno Lannes, a Bain partner in Greater China and lead author of the Chinese edition of the study. “Changes in what Chinese shoppers want are now a central issue for the global luxury sector’s largest brands.”
Greater China has bypassed Japan as the sector’s second market, behind the United States. Chinese consumers now make half of the luxury purchases in all of Asia, and nearly one third of those in Europe. Globally, one in four purchases of personal luxury goods comes from Chinese consumers. However, as the Chinese market matures, Bain has identified new trends and challenges for the market:
- Chinese shoppers in Beijing and Shanghai are now truly global luxury consumers. They are shifting away from typical emerging market preference for logos and other visible signs of luxury spending, and shifting to a global mindset of uniqueness, high-quality, and understatement in luxury items. Bain’s research shows 65% of luxury consumers in Beijing and Shanghai intend to buy fewer items with visible luxury branding
- Consumers elsewhere in China remain focused on conspicuous logos. 55% of consumers outside of Beijing and Shanghai say they will buy more products showing logos
- Gifting is shifting. Fewer than 25 percent of luxury spend is now dedicated to personal and business gifts. This shift means that brands now must focus more on the specific tastes and preferences of the consumer
- Shoppers are increasingly experienced with luxury shopping in other markets. Therefore, luxury brand stores in China need to deliver the same consumer experience in China as in France and Italy, or risk further deferral of spending to tourism. The experience challenge is critical, especially since luxury banners in China are struggling with same-store sales
- New consumers are defining luxury in China. Bain’s study shows that Chinese consumption is shifting from businessmen to younger shoppers and to “power women” with their own spending power and a taste for edgier fashion content
“Luxury in China is now about being ‘in the know’ versus being ‘in the show’,” concluded Lannes. “Brands will face much more pressure to make their offer relevant to the Chinese shopper rather than relying on luxury status alone.”
For a copy of Bain’s “Luxury Goods Worldwide Market Study, China Edition” or to schedule an interview with Claudia D’Arpizio, please contact Cheryl Krauss at email: firstname.lastname@example.org or +1 646-562-7863, or Pinky He at email: email@example.com or +86 21 2211 5585.
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