Luxury Industry Also Recovers Sales Riding Untact Trend in China

[Image source=Reuters Yonhap News]

[Asia Economy Beijing=Special Correspondent Park Sun-mi] The luxury industry’s sales in China, which had stalled due to the spread of COVID-19, are showing signs of recovery. Activating e-commerce sales in line with the untact (contactless) trend is being credited as a major factor in the sales rebound.

On the 9th, China’s state-run China Daily reported that the luxury industry has been showing a recovery in sales in the Chinese market since the COVID-19 outbreak. Louis Vuitton Mo?t Hennessy (LVMH), owner of the Louis Vuitton brand, achieved a result of more than a 50% increase in sales in China in early April compared to the same period last year. Hermes also reopened its flagship store in Guangzhou, Guangdong Province on April 11 and recorded daily sales of $2.7 million. Bulgari showed a strong recovery in China since mid-March after COVID-19 was brought under control, and expressed optimistic prospects for its China business due to the activation of e-commerce.

Jean-Christophe Babin, CEO of Bulgari, said in an interview with China Daily, “When the spread of COVID-19 peaked in China, we closed 50% of our stores nationwide, but now all have reopened. Moreover, many luxury brands have been expanding their online presence after COVID-19, and Bulgari had already built an online shopping platform long ago, which led to great results this time.”

He added, “Chinese consumers are exposed to luxury brands at a young age. The average age group is 25 to 35 years old, which is younger than Bulgari consumers worldwide,” explaining the background behind the success of activating e-commerce sales in the Chinese market for the luxury industry.

The cooperation between e-commerce platforms and the luxury industry is accelerating due to the spread of COVID-19. According to Chinese e-commerce company JD.com, amid the COVID-19 outbreak this year, more than 20 luxury brands including leather luxury brand Delvaux, jewelry brand Gucens, and luxury stationery brand Smythson have entered online platforms. Kevin Zhang, head of JD.com’s international business division, explained, “COVID-19 has affected many industries, and the luxury industry is no exception. Many luxury brands have realized the importance of online business.”

Meanwhile, McKinsey forecasted that consumption in the Chinese luxury market could double to about 1.2 trillion yuan by 2025.

This content was produced with the assistance of AI translation services.