Daniel Yong

Twenty something years ago when we talked about China, we came to the conclusion that China was poor, communist, third world, with no opportunities and carried all sorts of negative impressions. However, today or years before today, everyone wanted to go to China, either for travel or search for opportunities. Large organizations have offices and factories in China because it is a gold mine. Luxury sales in China currently represent 10% of the global market. However, an Asian investment bank estimates that by 2020, China will be the largest domestic market for luxury good and will account for 44% of global demand.

No one, including myself, ever thought of China would have developed so rapidly. Today China is the second largest market for luxury cars. About 939,000 luxury cars were sold in China in 2011, exceeding 914,000 vehicles that will probably be delivered in Germany. To be able to increase the market share, all three luxury automobiles makers, BMW, Mercedes, and Audi are competing with each other to be the leader in luxury cars in China. The three auto makers reported increased sales in China.

The luxury auto segment is only one of the rapidly growing markets in China. Another luxury product which attracts many foreign organizations is high-end apparel. When I was in Shanghai last year, stores such as, Gucci, Prada, Louis Vuitton, and other luxury apparel stores were are all over the city. While in Vienna and Rome 3 years ago, the Louis Vuitton stores were filled with mostly Chinese customers. Surprisingly, both locations hire Mandarin speaking employees to serve the Chinese customers. In New York City, it is very common to see bilingual Mandarin-English sales people in Louis Vuitton stores because more and more Chinese are visiting New York and they have the buying power for luxury products.

I am looking at China’s market, what about you?

Photograph Credit:
Sabrina Segal