The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
Nearly 41 percent of surveyed Chinese consumers said they would increase their spending on luxury goods over the next 12 months, according to Ruder Finn’s newly-released 2021 China Luxury Forecast.
The survey tracked responses from 1,500 mainland Chinese consumers with average annual household income of 1.44 million yuan ($224,434) during the month of January. The majority of respondents said they would increase or maintain their spending on beauty and cosmetics, with clothing and shoes the next most popular categories.
Nearly 36 percent of respondents said they spent more on luxury in 2020 than they had planned to. Niche luxury brands, excluding watches, were among their key purchases, the survey said.
The pandemic has accelerated the use of digital channels among consumers, with 55 percent of respondents saying they they prefer to purchase luxury goods online since Covid-19 started. Somewhat surprisingly, official brand websites were the top choice for consumers who wanted to purchase online, beating out platforms such as Tmall and JD.com.
With consumers tightening their belts in China, the battle between global fast fashion brands and local high street giants has intensified.
Investors are bracing for a steep slowdown in luxury sales when luxury companies report their first quarter results, reflecting lacklustre Chinese demand.
The French beauty giant’s two latest deals are part of a wider M&A push by global players to capture a larger slice of the China market, targeting buzzy high-end brands that offer products with distinctive Chinese elements.
Post-Covid spend by US tourists in Europe has surged past 2019 levels. Chinese travellers, by contrast, have largely favoured domestic and regional destinations like Hong Kong, Singapore and Japan.