In emerging markets, China's growing middle class is becoming a key consumer group for luxury goods, predominantly European luxury brands.
According to China's President Xi Jinping's speech on "common prosperity", China is seeking to narrow the wealth gap in the country. Although it has affected the share prices in this particular sector, the speech carries a positive future for supporting, developing the middle class, who have always been interested, aspired to set up their customer profiles in the luxury brand boutiques and own branded goods.
While many countries in the world were still suffering from the economic damage from COVID-19 with numerous restrictions, leading European brands have shifted the focus, leaning more towards the leading Asian market such as China, to create off-line customer experience by curating events, moving fashion shows to the capital of Chinese fashion -- Shanghai, while most of the fashion capitals are still under the lockdown restrictions. As seen in the recent fashion reports, luxury brands such as Louis Vuitton, Gucci, MiuMiu.
Luxury brands seem to find their way in making a "press success" in the local market and making the brand images more impactful. The Chinese market continues to show high spending power and contribute a decent portion to the revenues. The travel restrictions encourage the consumers to purchase luxury goods in their domestic country, as seen the continuous growth in the leather goods with locals' favourite brands such as Louis Vuitton, Hermes, Bottega Veneta and Chanel, with approx 40% including the year of the pandemic since 2019.
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