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Luxury goods firms feel pinch of austerity push

By Shi Jing (China Daily) Updated: 2014-10-16 06:49

According to a recent survey by global information provider Nielsen, shopping has now become the top leisure activity for many Chinese, with a resounding 97 percent of those polled putting it ahead of sights-seeing or other forms of entertainment.

Its finding also revealed that 90 percent of those expecting to travel said they planned to spend on luxury goods prior to or during their trip, and nearly 40 percent added they knew exactly which products they wanted to buy.

Mykim Chikli, chief executive officer of brand consultancy Zenith Optimedia China, said selling luxury goods in China used to be a relatively simple affair for top retailers, as Chinese consumers bought brands like Louis Vuitton to show off.

However, Chikli said the luxury landscape has changed rapidly since 2012 and marketers are facing growing challenges, not only from the cutback in excessive spending but also from more Chinese customers choosing to buy their goods overseas.

Chikli said, however, that declining sales do not necessarily spell the end of luxury in China, adding that they indicate "a new era of segmentation, sophistication and personalization".

She also said that companies are attaching more importance to digital marketing in their efforts at growing sales.

"Digital is now the best tool to promote the luxury category," she said.

"The in-store experience is still critical to feel the spirit of the brand - but digital is the best medium to tell its story and history."

Luxury goods firms feel pinch of austerity push

Luxury goods firms feel pinch of austerity push

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