The Chinese are the worlds nouveau riche. Currently China is the worlds second largest economy behind the United States. As in many economies the chasm between rich and poor runs deep, but the rich are certainly very, very, rich. What's more, they are big spenders in the luxury goods market. Though foreign companies are branching into the region, opening a business in China can be somewhat of a chore leading many companies to franchises or license their businesses.
Shopping destinations around the globe in Europe, Asia, and America are recognizing an increase in the presence of the Chinese and their propensity to spend on big ticket items. The tendency is towards guided tours with stops in multiple cities. A recent Women s Wear Daily chronicled one of these tours stopping in New York, Boston, Las Vegas, and Los Angeles. It was like a "power shopping" trip across the country with little else on the agenda, well, aside from meeting former president Bill Clinton and a touch of gambling in Vegas. On this particular shopping excursion Louis Vuitton, Chanel, Chloe, Prada, and Ermendegildo Zenga were favorites. While Slavatore Ferragmo, Celine, and Balencagia were unfamiliar to the group. They were also buying up luxury brand watches, often more than one at a time and dropping as much as $50,000 each with no problem. According to the article, the Chinese concentrate on watches as a means of achieving differentiation and status rather than buying a lot of suits. Some were then even buying new suitcases to store all their treasures. Oh, and did i mention most of there transactions were done in cash!!!
It is estimated that the Chinese will spend $55 billion on international travel and the number of travelers will increase 12-14% a year. They spend more money abroad than they do at home. With these kinds of numbers I think it would behoove retailers to adjust their game plans and become more China- friendly. Simple things like having a member of staff that speaks the language or having your staff learn a little bit about what the Chinese find offensive. Small investments like these could lead to healthy returns Also, finding ways to increase your brands recognition by the Chinese super spender. The methods could be really simple. In the case of one retailer catalogs were distributed on the bus and members of the tour simply picked out their purchases before arrival. I though it was a great way to ease some of the difficulties encountered with language barriers. The Chinese have no problem spending as long as they perceive excellence in a brand. So it is my suggestion that retailers, hop on the bandwagon or in this case......get on the bus!
Can you think of any ways retailers could make an effort to appeal to the Chinese???
This Video is just some more information regarding the increasing economic power of China that I think is relevant.
Information provided by
http://www.wwd.com/retail-news/the-chinese-rich-hit-the-stores-
http://www.youtube.com/watch?v=Nse09-dKATI
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