Ventura blvd.

May 2011

China’s contagious love affair with luxury brands

For the past few years, the terms ‘BRIC economy’ and

‘Chinese boom’ have been thrown around by the financial

markets and the business community to no end.

Indeed, from the outside, China does appear to be a

marketer’s dream; a land where almost any luxury brand can

sell in volume to a consumer base which has an insatiable

demand for all things premium.

But, establishing a brand here isn’t without huge challenges.

It’s important for brands looking to move to China not to

discount the knowledge and the role that local brands play in

the marketplace and to ensure they have the facilities in place

to support growth as well as the right people on the ground to

maintain the organization’s reputation, which made it such a

successful luxury brand in the first place.

Going forward, as the Chinese consumer matures, the biggest

challenge won’t just be about selling luxury brands, but luxury

brands which maintain China’s global identity on the world

stage.

William

Ni hao, luxury.

China is now Audi’s largest market with 45% of global sales

Source: Audi

This year, Jaguar Land Rover will begin production in China to meet huge demand.

Source: Jaguar Land Rover

Half of all Switzerland’s $8bn watch exports are now Asia-bound.

Source: KPMG

It’s not just Beijing and Shanghai; luxury brands are spreading to provincial cities like Xian and Chengdu.

Source: Business Wire by Berkshire Hathaway (2011)

It’s also not just western luxury brands making an impact, there’s now a whole new generation of home-grown luxury brands.

Chinese brands like Chow Tai Fok, Chow Sang Sang and Luk Fook are as just as popular as Cartier and Bulgari.

Source: Baidu statistics

Western brands need to tailor their image to the local market.

Hermès launched Shang Xia, an exclusive brand for China

Source: The China Post

Volkswagen is also planning to develop a “China-only” brand in the quest to dominate the car market

Luxury brands may no longer be the preserve of the west, but it will be the introduction of Chinese brands in the US and Europe that will signal the biggest change…

William Smith is a Brand & PR strategist with

experience in the UK and United States.

He recognizes the importance of building a world-class

brand and has worked with clients including KPMG,

Skype, AstraZeneca, Expedia, Oxfam, Eircom,

General Mills, Corky McMillin and DFDS Seaways, as

well as helping a number of smaller brands.

William believes that online and offline brand behavior

is not mutually exclusive, and that by aligning what a

brand says with what it does, it can actually add value to

peoples’ lives.

About William.

@VenturaBlvd

Thank you.

@VenturaBlvd

linkedin.com/in/williamrtsmith

www.venturaboulevard.blogspot.com