Coco Chanel famously said: “I don’t do fashion. I am fashion.”
To Coco Chanel, and to many here in Asia, there is something deeply personal about fashion, and luxury fashion in particular. The experience of buying, owning, and using luxury goods touches a person's identity, shapes and molds their public image, and influences their sense of belonging in society. And we are seeing such concerns animating the thriving Asian luxury goods marketplace.
The 2019 China Luxury Forecast, hot off the press from Ruder Finn and Consumer Search Group, is an indicator that Hong Kong's luxury retail market shall remain buoyant in 2019 along with the rest of China. The following are key takeaways:
1. Consumers in both mainland China and Hong Kong are purchasing luxury goods for two major reasons. First, to improve their quality of life. Second, to reflect their taste. Such concerns link up with general notions of satisfaction, an important happiness indicator. If the possession of luxury goods remains a core input for determining such satisfaction, 2019 should be a record year.
2. As purchasing power in China continues to increase, the per capita spending on luxury goods is projected to increase (e.g. 46% of the Forecast’s mainland Chinese survey respondents said they plan to increase their spending on luxury goods in 2019). To grasp the numbers involved, in 2018 mainland Chinese consumers spent an average of RMB 240,000 on luxury goods. In Hong Kong, that number was HKD 176,000.
3. For luxury retailers, there are potentially lucrative demographics. In Hong Kong, Generation Z consumers (age range being 21-25) showed the most enthusiasm toward the purchase of luxury goods in 2019, while in mainland China it was the 46-and-above age range. Such knowledge can and will be used to craft relevant advertising campaigns and source demographic-savvy leaders and teams to develop and implement them.
What will be luxury retailers’ priorities and objectives this year? What kind of skills are required for success in retail in 2019?
1. A strong luxury retail outlook in China and Hong Kong indicates you are in a growth sector. This means there will be opportunities emerging, both in terms of career advancement and in terms of leadership development. But it also means there will be increased competition all around, given the attention the sector is receiving. Refine your personal brands in preparation.
2. Luxury retailers will be focusing on how to reconcile their in-store experience with the trend of online shopping. According to the Forecast, there are three trends to be aware of: Look Up Online and Purchase Online (LOPO), Look Up Online and Purchase in Physical Stores (LOPP), Look Up in Physical Stores and Purchase Online (LPPO). LOPP was found to be the most preferred method.
3. Without focusing on the full-range of retail-related skillsets, there are three that are especially relevant. First, vision. If you want to navigate your company through competitive seas, identify and keep top-of-mind your vision of the destination. Second, creativity. Luxury retail is refined and built on decades, sometimes centuries, of fashionable grace and elegance. Thus, be creative in leveraging your brand’s historical character to appeal to the shifting tastes and perceptions of today’s consumer marketplace. Third, resilience. Luxury retail is a tough business, but a deeply rewarding one. The relationships formed, the experiences lived, and the lifestyle exposure gained are perhaps second to none.
Keen to explore your next career move within luxury retail? FocusCore Recruit partners with some of the world's most prestigious luxury retail brands.
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