Who are the consumers of luxury goods in China?
China is the now the second largest global luxury market and the most promising for future growth. All the major luxury brands in the world have their eyes on China who makes up for more than 15% of global luxury goods.
Let’s take a look to see who are the elites that makes up these distinctive habits in the Chinese population.
And since corruption is the common norm in the Chinese political party, the members make up for a large part of the luxury consumption in China.
Upper Crust Chinese people
There are 320,000 Chinese millionaires and 60 them are billionaires.
These people, mostly men, took advantage of the opening of China and have grown rich in the last ten or so years.
,Mr Zhou: the richest man in China,a fortune estimated at 12 billion Dollars
Why are they important consumers of luxury goods?
To maintain the networks and as a matter of image. These two values, typically Chinese (Asian) contribute to the development of the luxury market in China.
Guanxis are networks, each influential person is rich because of its partners and connections with them in the government in China. The network must be maintained in order to succeed in business.
Business gifts for politicians and businessmen continues to be an important force driving the luxury product demand. Liquor brands, such as “Chateau Lafite” or” Baijiu” capitalized in on this high demand.
Appearance is how society comprehends a person by his social class. Rich people like to show their wealth and affirm their social status, that is especially true in China where face is everything. In a country full of new money being extravagant is admired by society.
According to Wikipedia : “The term white–collar worker refers to a person who performs professional, managerial, or administrative work”.
Managers in China continue their upward mobility of salary with incomes that are surprisingly high in the major Chinese cities.
They make up the middle class of 150 million Chinese and are potential buyers of luxury goods. Regular customers of luxury are just over 1% of the population, equaling at approximately 15 to 25 million people.
This class tends to grow and in the coming years should be the largest consumer of luxury products.
The Chinese mistresses
Nicknamed the ernai, / Sanxia / xiaolaopo, the chinese mistress is the second woman in the life of a Chinese men. They are more common in southern China, every self-respecting business man has to have several mistresses, who cares for him one or two days a week, or when traveling.
,These mistresses are fond of luxury goods and ask their rich lovers to buy such gifts. In many stores, we see old rich Chinese men along with their young pretty mistresses cleaning out a Cartier and Louis Vuitton store.
You can also find prostitutes or luxury escorts in KTVs or other places of entertainment who are just as crazy about cosmetics and clothing brands.
The Chinese tourist is a major consumer of luxury goods. During their trip abroad, they will be a major buyer of handbags, jewelry, watches and other luxury products in the luxury market.
Countries like France, Italy and Hong Kong are the primary major beneficiaries.
Luxury shopping for many Chinese tourists are the primary reasons for traveling to Hong Kong, where taxes on luxury goods are 30% lower than in mainland China.
Since many mainland Chinese consumers cannot trust the veracity of the products in stores, they are attracted to traveling abroad to purchase authentic products.
Because of their lower purchasing power, these tourists save large sums of money ready to spend on luxury goods during their travels. They are a preferred target for the future as their numbers should increase.
.It is important to notice that the age of luxury consumers in China is lower at 34 years old. Chinese consumers of luxury goods in this age group make exceptionally frequent impulse purchases.