China's rich have insatiable appetite for haute couture
Updated: 2008-05-29 13:58
Chanel is the most preferred high-end fashion brand for affluent Chinese followed by Giorgio Armani, according to a report by MasterCard.
Oscar de la Renta says China is central to a strategy for Asia which it hopes will account for 20 percent of its sales within five years, up from 5 percent at present, helped by its burgeoning accessories' business.
Luxury brands can easily sell their perfume and cosmetics in local department stores. But when it comes to ready-to-wear fashion, they are all competing for space and customers in a handful of luxury malls such as Plaza 66 in Shanghai and Lane Crawford in Beijing where rents are sky high.
"They're overpaying (on rent) but they're looking at China as an investment," said Marcel Braun, Hong Kong-based executive vice-president of Swiss company DKSH, which advises luxury firms on market expansion.
"Fifteen years ago brands came and left. Now they can't do that anymore, China's too important."
China's luxury market is still in its infancy and luxury retailers are experimenting to find the right model and get the sales strategy right, analysts say.
Lane Crawford has pieces of modern art on display in its spacious Beijing store, aiming to offer a new concept in shopping. It sells more than 600 high-end fashion brands, but visitors to the store say shoppers are often scarce.
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