Future of Luxury in China

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Recently I suggested that China is entering and creating a 2.0 version of consumerism, predicting Chinese consumers will take the American version and quite literally “hit it out of the park”.

Within this context, it is interesting to consider luxury … China’s most consolidated and talked-about category.

Since the reemergence of consumerism in China, the presence of global luxury brands has acted as a harbinger for the nation’s wider transformation.  Luxury has consistently been the symbol of arrival at the national, city and personal level.

This may seem strange for a market that is ostensibly always about family. But looking at the short history of luxury in China to date, it has been fanatically about self actualisation – celebrated as deeply personal and a proudly selfish indulgence.

The elite cliche of early arriver brands – such as Louis Vuitton, Armani, Prada, and Dior – have maintained a psychological distance from the Chinese consumers that adore them.  Playing a role akin to the “cool kid you know, but will never be friends with”.

In a recent interview with a wealthy luxury consumer in the South-western city of Wuhan,  I was exploring  the relationship she had with Dior, one of her favoured brands.   She described the brand feeling very distant, it is “like Dior is on the moon, we will never reconcile or get to know each other.”

In other conversations, I have heard a desire for a more intimate relationship with luxury brands.  The lead advocates are married couples, who are increasingly coordinating their luxury purchasers together as an expression of their partnership.

Almost blushing, Chinese tough guys were telling me that are regular browsing the “Mr Bag” website to make sure they were getting the perfectly appropriate gift for their wives.   Wives, glowing, told me of how they loved to educate their hubbies on the stories and heritage of the luxury brands they bought together.

It was quite obvious that couples are buying together, and luxury items are becoming emotional symbols of their romantic stories.  In a wider sense luxury purchase is becoming a powerful symbol of their immediate family – the one they are building.

Somewhat accidentally, two brands are successfully engaging this sentiment – Burberry and Dolce Gabbana.  Both brands in their 2015 campaigns have placed luxury in a family context, albeit in differing ways.  Burberry, has wholeheartedly celebrated Christmas, featuring the toothy grin of Romeo Beckham, the son of Chinese most adored foreign celebrity.  While Dolce Gabbana presented a idealised version of a global family featuring three generations of different nationalities including Chinese.

An underlying factor creating a more family focus of luxury will be the fact that luxury will help create them.   In a macro-environment created by the one-child policy, too many men are now vying for the hearts of women who are marrying later.   Somewhat naturally, romance will make a big comeback, and the “process”  will be paved and memorialised with lush luxury purchase moments.

Taking Luxury China 2.0 a little further , we will see the concept of family will be expressed through specific brand relationships.

This is not new, of course.  Before the Communist victory in China, rich families in cities like Shanghai were recognised as such, precisely due to their use of certain luxury items.  In a full historical circle, we can see that during the Maoist period, luxury was banned, and the family was marginalised as a unit.  Now as China returned to capitalism, luxury has concomitantly returned, and the family has become increasingly prominent within this context.

The connection between family and luxury comes naturally  to Chinese consumers.  Quite naturally, it is the next step for luxury.   In the near future expect to see multiple “family of three”s crushing and expressing themselves through the same luxury brands.

About Author

Jerry Clode

Jerry Clode is Head of Digital & Social Insight at Resonance. He leads Resonance SMART, providing leading-edge research, strategy and naming for brands in China using bespoke methodologies. Jerry also produces Resonance's popular China Social Branding Report, a bi-weekly publication covering modern marketing methods of the world's top brands.

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