9 December 2022

Luxury brands are questioning whether continuing price increases in the China market are the right choice. The brands say they are aimed at consumers who don’t have a problem spending, especially those who, being young, do not look in the rear-view mirror at how much the same product cost three years ago.

 

 

At present, this strategy may work as Oliver Wyman’s “The New Faces of Chinese Luxury Buyers” report shows that 50% of Chinese fashion and luxury accessories buyers entered the market between October 2020 and September 2021. In other words, they are unaware of the previously charged prices. This year, according to the report, this audience share will drive more than 80% of market growth.


However, the situation in the Chinese market is changing, between the lockdowns, the economic slowdown, and the nationalist trend “guochao”.


Long gone are the days when droves of Chinese tourists would descend on Galeries Lafayette in Paris to buy a Gucci bag and show it off to their friends back home. It just does not have the same kudos to buy the same bag in Shanghai rather than Paris and pay more for it.


Increasing prices at every opportunity may turn out to be counterproductive for luxury brands that depend on China to boost international sales since, at some point, the price elasticity will eventually snap.

About APLF

We bring leather, material and fashion businesses together: an opportunity to meet and greet face to face. We bring them from all parts of the world so that they can find fresh partners, discover new customers or suppliers and keep ahead of industry developments.

 

We organise a number of trade exhibitions which focus on fashion and lifestyle: sectors that are constantly in flux, so visitors and exhibitors alike need to be constantly aware both of the changes around them and those forecast for coming seasons.

 

APLF Fairs follow Informa AllSecure, Informa’s approach to enhanced health and safety standards at events in the aftermath of COVID-19.

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