The Chinese luxury market has evolved rapidly, but one thing that characterizes 2010 is the sheer number of global brands opening stores or ramping up their China presence thanks to the rising disposable incomes of the Chinese and their desire for designer brands.
Bain & Company estimated the Chinese luxury market at around RMB 84.3 billion for 2010, up from RMB 68.4 billion. New customers account for RMB 10.7 billion of the projected increase. The Chinese market is supply driven and new store openings create new demand.
For the 15 brands surveyed by Bain through August 2010, a combined 80 new stores were opened in 2010. Retail presence of the 15 brands as of August 2010:
Total Retail Stores in China
Hugo Boss: 89
Hermes: 20 (+2 more openings in September)
Versace: 19 (+1 more opening in December)
Without question, western luxury brands have invaded China this year, some additional highlights:
Versace: (20 retail stores) Opened its first dedicated jewelry boutique in Beijing in December. Versace is planning to launch another store in China in Village North, a shopping complex in affluent Sanlitun. Versace will open another flagship in Shanghai’s Plaza 66 shopping center and another store in Zhengzhou, in Henan Province, sometime in 2011.
Salvatore Ferragamo: (50 retail stores) The Florence-based company has 50 stores in 32 mainland cities in China. The company plans to open seven to nine stores in lower-tier cities in 2011.
Ermenegildo Zegna: (62 retail stores) China now comprises of one fourth of the company’s sales, and within 15 years, may account for almost 50 percent according to company CEO Ermenegildo Zegna.
Corneliani: (16 retail stores) The high-end Italian menswear label will have a total number of 16 boutiques in China in 2010. Ten of the stores were opened in 2010 alone.
Armani: (16 retail stores) Armani debuted an online store in China this November. The company has one of the most innovative expansion strategy with two Giorgio Armani stores, one Armani Collezioni boutique, five Emporio Armani stores, six Armani Exchange stores, two Armani Casa boutiques, as well as two Armani cafes, an Armani Libri bar, two Armani Dolci chocolate shops, and two Armani Fiori florist shops in China.
Van Cleef & Arpels: (8 retail stores) The French jeweler opened four new stores in China this past year.
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