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Mia Castagnone

More than half of luxury consumers in mainland China plan to increase spending on such items over the next 12 months and are looking for domestic brands that are “more relevant” to their tastes, according to a report released Thursday.
Shoppers have an increasing appetite for luxury experiences and lifestyle products, in addition to tangible luxury goods, according to Simon Tye, the CEO of MDRi, which published its annual luxury report.
“Chinese shoppers want to spend more among all the different brands from the different parts of the world,” Tye said. MDRi surveyed 1,500 luxury consumers from mainland China and 500 from Hong Kong from April to May this year for the report.
All respondents were required to have made a minimum spend of 50,000 yuan or HK$50,000 on luxury purchases within the past 12 months.
The report showed that mainland Chinese purchasing power increased in 2023: polled consumers said they spent an average of 234,500 yuan (US$32,330) on luxury items, a 7 per cent increase from 2022.
Consumers from second-tier cities in China had the highest purchasing power with an average spending of 253,800 yuan in 2023, an increase of 22 per cent from 2022.
In addition, 56 per cent of mainland Chinese luxury consumers said they plan to increase their purchases from domestic luxury brands over the next 12 months.
“[Chinese consumers] find that Chinese brands are more relevant,” Tye said. “Why? Because they’re speaking to them in a way that they understand and they know how to tell the story behind what they’re trying to do.
“The slowdown with luxury right now is not because of a lack of finance, it’s whether [your brand] is relevant.”
Major luxury conglomerate LVMH reported a 10 per cent drop in revenue in Asia for the first half of this year, excluding Japan, while Kering’s Asia-Pacific revenue – also excluding Japan – dropped 22 per cent from a year earlier for the same period.
And yet a select few brands have managed to respond faster to trends in China, including Lululemon, Adidas and Ralph Lauren; they have outperformed their peers and reported strong revenue growth so far in 2024.
The MDRi report said shoppers from the mainland want an elevated experience and special edition products when they shop. Consumers are still interested in purchasing Cartier and Chanel, Tye added, but they are increasingly interested in local brands like Common Moi, Feng Chen Wang and Haizhen Wang.
“This whole idea of community is emerging and brands need to tell an incredible story to find a way to reconnect with relevance to the Chinese consumer,” Tye said.
Tier 1 cities remained the dominant destinations for domestic shopping, with Shanghai, Beijing and Guangzhou on top. Sanya, a duty-free haven, came in fifth. Internationally, consumers said they did most of their shopping in Singapore, South Korea and Japan.
The report also showed that mainland Chinese consumers continued to be interested in luxury travel; nearly 60 per cent of people polled planned to allocate more of their budget to such trips.
When looking at different age groups among mainland Chinese luxury consumers, Tye said the younger generation is seeking a greater sense of individuality. He said they understand how to create a style for themselves.
“It’s not about the money, it’s about the way [Gen Z] is growing up and they’re challenging the status quo,” said Tye.
People aged 21 to 25 view luxury as a lifestyle that includes well-being, self-care and long-term satisfaction. In contrast, millennials aged 26 to 35 view luxury as a way to indulge and enjoy the fruits of their labour.


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Report says 56 per cent of mainland Chinese luxury consumers plan to increase their purchases from domestic brands


Report says 56 per cent of mainland Chinese luxury consumers plan to increase their purchases from domestic brands.


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More than half of mainland Chinese luxury consumers plan to increase spending: report

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Report says 56 per cent of mainland Chinese luxury consumers plan to increase their purchases from domestic brands

Report says 56 per cent of mainland Chinese luxury consumers plan to increase their purchases from domestic brands