Losing luxury
While Chinese consumers have continued to buy luxury goods across the globe, China's luxury market has slipped into decline. An industry report showed that about 83 percent of luxury brands shut down some of their stores in 2015 - a trend that is expected to continue. The shift in consumer spending to foreign markets has been driven by the growth of outbound tourism, experts said. As Chinese consumers change their spending habits, luxury brands will have to employ a more tailored, localized marketing strategy in the coming years.
On a Saturday afternoon in April, a woman surnamed Wu browsed for handbags in an almost empty luxury brand store in Beijing's Chaoyang district.
"I love buying the handbags of luxury brands like Chanel, LV and Dior, but I usually purchase those bags when I travel abroad," she told the Global Times on Saturday.
"Although the prices of luxury goods sold on the domestic market have gotten cheaper, I'm just not that crazy about buying these products in China."
One of the store's employees said that there had been a time when customers would line up outside the store when a new product hit the shelves. But nothing like that has happened "in the past two years," she said.
While a growing number of Chinese customers have been seeking to buy goods worldwide, the Chinese mainland's luxury goods market has been declining.
In 2015, the market shrank by 2 percent to 113 billion yuan ($17.39 billion), according to a report issued by the global market research firm Bain & Company in January.
The decline largely resulted from a slowdown in sales of watches, menswear and leather goods, according to the report.
Given the downturn, three tags can be used to describe mainland's luxury market in 2015: discounting, pricing adjustments and store closures, experts noted.
A tide of store closures
More and more luxury brands have been closing stores in recent years. About 83 percent of luxury brands shut down stores in China in 2015, according to a report released in April by the Beijing-based iResearch Consulting Group, which predicted the trend will continue.
For example, French luxury goods maker Louis Vuitton closed three of its stores in China in November 2015, including what had been its first store in Guangzhou, capital of South China's Guangdong Province.
It is expected to shutter several more stores across the country in the near future, media reports said.
German luxury retailer Hugo Boss shut down 20 of its stores in China last year, the iResearch report said.
Italy-based fashion brand Gucci closed five stores. Prada, also from Italy, also closed two outlets during the same period.
Besides store closures, foreign luxury brands have responded to the shrinking market in China by adjusting the prices of their products.
For example, French fashion house Chanel raised the prices of its most well-known handbags - the 11.12, the 2.55 and the Boy bag - in Europe in April 2015.
But it also cut prices in Asia, including on the mainland and in Hong Kong, to offset the decline of the euro and discourage customers from buying fakes, according to media reports.
