Luxury Society brings us exclusive findings on the Chinese luxury market, including trends of the “digital native” (Post-90’s) generation, their interests and consumption behaviors.
North America and Europe have been prime sources of revenue for luxury brands. But the elephant in the room is China. With a growing middle class and increasing purchasing power, China is projected to make up over 30% of the global market for luxury goods.
With that kind of global importance, it makes sense to inspect the Chinese market a little closer. Our friends at Luxury Society have just come out with some surprising findings from the East, courtesy of an exclusive video report by Wan (Grace) Zhang, General Manager of Baidu in East China.
As it turns out, millennials are becoming the main consumers of luxury goods in the country – those born between 1990 and 2000. This is the so-called “digital native generation” and it will be an important market demographic that luxury brands must woo in the next few years.
Interestingly, the report also uncovered that Cartier was the most highly regarded of the luxury watch brands among Chinese millennials. The reason? Its newest ambassador is Lu Han, a well-known singer and actor, showing that brand ambassadors are hired for more than just photo opportunities at fancy product launches.
While digital natives are important, the digital space itself is not the only marketplace for luxury goods. In another report by Agility Research and Strategy for Luxury Society, luxury brands should take away two main lessons about Chinese consumers in 2017.
First, affluent Chinese – those with assets of at least USD 1 million – believe that they will receive more income in the future compared to last year. That confidence translates to a belief that they will spend more on luxury items next year, making China a key market to watch out for in 2017.
Second, affluent Chinese consumers like to travel, and when they travel, they shop. Apparently, 64% of them mainly buy luxury goods while traveling, compared to the 53% that purchase luxury online in China.
So while the digital natives are important for the luxury market, it seems like affluent consumers still have a preference to make their purchases in stores, where they can get that personal touch. In fact, up to 70% prefer making luxury purchases the analog way, whether at home or abroad, rather than online.