Content library

Oct
2015

3Q 2015: Publisher’s opinion

Click to download the full report

I had an interesting conversation recently about luxury, or to be precise the definition of luxury. The challenge being that, depending where you stand and look at it, ‘luxury’ can mean different things to different people, particularly to those from different cultural or experience backgrounds. Of course, we should also not forget that the word luxury has become more commonly used in recent years and has been attached to products and services that to a purist could never be luxury.

The purpose of saying a few words on this subject is because in China meanings and interpretations that are commonplace and easily accepted elsewhere in the world, do not have the same definition here. So when we talk about the luxury market in China and luxury products that consumers are willing to buy, the range is wide and the choice of brand names significant. Over the past five years, we have seen brands that are no more than premium in status, come to China and take up a luxury position in the market.

The descriptor ‘affordable luxury’ was proffered by Coach to add status to its products and it worked very well and has subsequently been adopted by many other mid-range brands as they arrived on these shores. Provided a brand commenced its introduction to the Chinese consumer by defining their product as affordable luxury and repeated this for some time, then they became a’luxury’brand. There was at on time a clear definition of a luxury mall in the consumers mind as a cathedral full of super premium and premium brands such as Plaza 66 in Shanghai, but now this church has become broader, and accepts demonetisations from lower luxury orders such as entry and affordable luxury brands.

The Chinese are the number two buyers of luxury in the world, and possibly as the church of luxury opens its arms to accept more junior members of its flock in order to satisfy, and tap into the greatly increased urban population, it will continue to expand far more than countries with a long heritage in this area. The important point for those who do not work and live in China is to understand that luxury here is not the same as luxury elsewhere, but because of its broad appeal, a growing consumer base and the element of status it brings, ‘luxury’ is a way of life and not just about quality and attention to detail in a physcal product.


Top