China is becoming the world`s third-largest consumer market, worth $2.3 trillion by 2025 (according to McKinsey, reported in Newsweek, others say China is soon to be No 2 in the world). Consumer spending have risen 15 % a year over the past 2 years. Asia has surpassed Europe in terms of the number of wealthy citizens. (America still in first place.)
The Chinese already buy more cars and televisions than anyone else, and they are No 2 when it comes to PC sales. Sales of Jewellery is up 25 % a year, cosmetics up with 20% and luxury automobiles up 50 %.
The new rich and going-to-be rich Chinese consumers are not simply accepting to buy copies of what rich consumers in West are buying, no they are demanding luxury goods that are tailored especially to them. China wants to be seen for the unique culture it is, and brands who wish to succeed need to understand the values and beliefs of Asians, and not assume they wish to be just like us.
Many large brands are becoming humble, adapting to the market they are in.
Hermes recently opened a boutique in Shanghai for its new Chinese brand Shang Xai. There are Ming-style chairs, eggshell porcelain bowls and jewellery inspired by unusual Chinese collectible baubels, such as teapots. Materials used are zitan wood, lacquer and Mongolian cashmere – all very luxurious and local.
BMW has introduced a China-only limited version of its muscly M3, called the Tiger, which is named for the 2010 Chinese New Year and features fiery orange-and-black coloring.
French fashion house Chloe will launch a Chinese version of its Marcie handbag in red, which is the lucky color in China.
Estée Lauder and Lancome are developing or buying cosmetic brands specifically for the Chinese market.
Levi Strauss has rolled out a jeans brand, Denizen, with slimmer cuts and more localized styles to appeal to the Asian middle-class. It is interesting to see that Levi´s are marketing the new brand to one the values of Asian countries: unity and togetherness. From the website “dENiZEN™ has another great meaning too: the idea of someone who frequents a particular place, the idea of belonging to a community of friends and family.”