8 Trends to Watch in China's Luxury Sector

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Source: KPMG “Luxury Experiences in China” Study ，May 2011 �


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China’s luxury industry is developing at a rapid pace. China is the world’s second largest luxury consumer market behind Japan. The following presentation summarizes the key Cindings of KPMG’s recent consumer survey entitled “Luxury Experiences in China.”


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China’s luxury buyers are basing their purchasing decisions upon an increasingly wide range of factors. Emotive factors such as experience and self-reward have now emerged alongside status-seeking and needs-based factors as key drivers.

Trend 1


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There is a new wave of luxury collecting and connoisseurship which, although still less signiCicant overall, is particularly evident among the wealthy in tier-two and even tier-three cities. While the past year has seen an explosion of interest in Cine wine, the KPMG survey suggests that jewelry, Cine art, and antiques also have strong growth potential.

Trend 2


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Luxury brands are spending more time developing digital media as part of their marketing strategies. Nearly 70% of KPMG’s survey respondents said they search for information about luxury brands on the internet at least once a month, and 30% do so at least once a week.

Trend 3


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While ofCicial websites can be an important means for validation and comparison of products, China has seen a growing number of blogs providing coverage of luxury goods and these can be more powerful in shifting or reinforcing brand perceptions.

Trend 4


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Although becoming more open to online sales, consumers continue to show an overwhelming preference to purchase big ticket items such as watches in branded stores.

Trend 5


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On average, Chinese consumers now recognize 57 luxury brands, a Cigure that has risen steadily over successive KPMG surveys. Respondents in tier-one cities recognize 61 brands compared with an average of 53 in tier-two cities. The market is becoming ever-more crowded.

Trend 6


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Chinese consumers also distinguish very clearly among countries of origin, and associate certain countries particularly strongly with certain products; for example Switzerland for watches, France for fashion, accessories and cosmetics and Italy for footwear.

Trend 7


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There continues to be an extremely strong association with European brands at the expense of brands from other regions, suggesting that brands of other origins need to consider how to distinguish themselves, or create a niche.

Trend 8


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8 Trends to Watch in China's Luxury Sector

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