Domestic consumption potential is fully released, and China has become a global luxury market "thriving"

Shanghai, January 21 (China News Service) (Reporter Li Jiajia) Under the epidemic, Chinese outbound travel has been blocked, but it has unexpectedly created a boom in China's luxury goods market, and the ability to "attract attention" and "attract gold" has increased greatly. In the offline stores and online stores opened by overseas brands in China, and in the Hainan Duty Free store, this consumption potential has been fully released.

Recently, invariably, in the reports released by several major research institutions, the Chinese mainland luxury market has become the "thriving" of the global market because of its sharp growth rate, and Chinese consumers have even been called the "life-saving straw" of the global luxury market.

The "2021 China Luxury Market Report" released by Bain Company on the 20th pointed out that after achieving 48% growth in 2020, China's personal luxury goods market is expected to achieve 36% growth in 2021, reaching nearly 471 billion yuan (RMB, the same below), and the overall scale is nearly double that of 2019.

Bruno Lannes, Senior Global Partner at Bain & Company and co-author of the report, said: "This growth trend will continue in the future, and regardless of the progress of the future recovery of outbound travel, the Chinese market is expected to become the world's largest luxury market by 2025." ”

The judgment of China's local high-end lifestyle professional research and consulting institution VIP Research Institute is more optimistic. According to its "2020-2021 China Luxury Goods Report", the luxury goods market in Chinese in 2021 increased by 18% year-on-year, with total consumption reaching 146.5 billion US dollars, nearly 1 trillion yuan, and the Chinese market became the world's largest luxury market for the first time, accounting for 30% of the global luxury market.

In fact, long before the outbreak of the new crown epidemic, China's luxury retail market has shown a trend of vigorous development and rapid transformation, but the outbreak of the epidemic has pressed the "acceleration button" for this trend.

Under the epidemic, Chinese to go abroad to shop, leaving a lot of consumption in China, and for the first time realized that luxury goods consumption exceeded overseas. Hans-Peter Bouvard, general manager of the Beijing branch of Rolex (Shanghai) Co., Ltd., said bluntly that his industry felt the impact of the epidemic for the first time, "Since 2010, Chinese consumers have become more and more fond of traveling in the south of the sea, and the enthusiasm for overseas shopping has been rising. After the outbreak of the epidemic, outbound travel has been blocked, it is difficult for consumers to go abroad to shop, and overseas purchasing is also inconvenient. As a result, nearly 30% of China's luxury consumer demand has quickly returned in just a few months. ”

Zhou Ting, president of the VIP Research Institute and an expert in the luxury industry, pointed out that the investment channels are narrow and the increase in investment to consumption, especially investment-oriented consumption, is one of the most important reasons for the sharp increase in sales of high-priced luxury goods. In addition, she also believes that lifestyle education such as new media and social e-commerce also gives many people the opportunity to learn more about luxury brands, yearn for a high-quality lifestyle, and make it easier to reach and buy luxury goods.

"Who would have thought that sneakers and ripped denim outfits could one day become luxuries? These consumer goods, which originally belonged to sports people or blue-collar workers, have now become trendy pieces of top brands. Wang Yajin, an associate professor of marketing at China Europe International Business School, said that in China, many young people around the age of 30 actually earn a lot, and young people hold a large amount of disposable income and do not have to shoulder a heavy economic burden. Because of this, they pay more attention to "self-reward" in consumption, are willing to spend money on themselves, and buy big brands without mercy.

Indeed, the change and alternation of generations is also changing the map of China's luxury market. Tencent Marketing Insights (TMI) and the Boston Consulting Group (BCG) recently released a report that the "post-90s" who have entered the year of establishment will become the backbone of market consumption, and consumers aged 21-30 have occupied half of the Chinese luxury market, contributing 46% of sales revenue.

Not only that, but the shopping environment is also becoming more and more friendly. In recent years, major brands have spared no effort to narrow the price gap between the mainland market and Hong Kong, Singapore and other places in China. "Brand discounts are becoming more and more normalized, and the rapid development of the outlet and duty-free industries, including the transfer of the industrial chain to China, has reduced the purchase price of luxury goods in the Chinese market to a certain extent and promoted consumption growth." Zhou Ting said.

At present, in order to narrow the distance between young Chinese consumers, many big brands are trying to put aside the "classic" image of high-end atmosphere and instead draw design inspiration from the avant-garde trend concepts that young people are keen on, such as punk, street, and hip-hop culture. Cai Yingling, Vice President of Resources and Corporate Communications at Moënýnest Hennessy Diageo Liquor Chinese, said: "We have hired more 'Generation Z' elites to inject more young vitality into the company and 'read' the way of thinking of young consumers with us. (End)

Source: China News Network