Journal : Global Times (Chinese) Date : Author : Michelle Tao, translation by Chen Kang Page No. : NA
URL : NA

Extracted from a CNN article on December 16, originally titled: Despite the shrinking global luxury goods sales, China’s luxury goods market is still booming  

 

The new crown epidemic has hit global demand for luxury goods this year, but the growth of China’s luxury goods market is still “unstoppable”.

A joint report released on Wednesday by Alibaba’s shopping platform Tmall and Bain Consulting said that despite the outbreak of the epidemic, China’s luxury goods market is expected to grow by 48% this year, reaching approximately 346 billion yuan ($52.9 billion). This means that the global share of luxury goods in mainland China has almost doubled, from 11% last year to 20% this year. Bruno Rana, a partner at Bain & Company, told CNN: “Mainland China is the only major luxury market that will grow in 2020”.

However, it is not all good news for luxury goods manufacturers. China’s sales boom has always been driven by consumers who usually spend a lot of money on luxury goods while on vacation abroad. The above report pointed out that the total spending on luxury goods of Chinese consumers (abroad) has fallen by about 35%, and that “the growth of the mainland Chinese market cannot compensate for the decrease in Chinese consumption abroad”.

China suppressed the spread of the new corona epidemic in the country early in the day, enabling the country’s economy to resume growth. After April, Chinese consumers began to chase expensive handbags, shoes and jewelry. At a time when other markets around the world are in recession, China has given retailers some hope.

The epidemic has accelerated several long-term trends. Even before the outbreak of the epidemic, due to factors such as the shrinking price difference between domestic and foreign luxury brands and the poor shopping environment in Hong Kong, mainland Chinese shoppers had begun to spend closer home.      

The epidemic has prompted more people to switch to online shopping. This habit is likely to continue. Nearly 40% of Chinese consumers plan to buy more luxury goods online in the next few years, and another 40% expect them to maintain their current consumption levels.

print
Share now