Forget about Paris and New York. Chinese dying for haute couture gowns or the latest luxury bags can now shop right at home.
Makers of luxury apparel, liquors and other goods increasingly are looking to China, India and other developing countries for growth they won't find in older, established markets in Europe.
To meet soaring demand for Asia's newly affluent, venerable names such as Prada and Giorgio Armani are setting up stores as quickly as they can and even considering making some of their products here.
"China is certainly the most prominent and most important market we have in front of us," Paolo Fontanelli, chief financial officer for Giorgio Armani SpA, told a conference on luxury brands held Thursday in Shanghai.
Although Chinese mainland, Taiwan and Hong Kong together account for only a tiny fraction of Armani's sales, the fashion group is quickly adding stores in the country, both in major cities like Shanghai and in lesser known ones, such as Shenyang in the northeast and Chengdu in the southwest.
And while the company led the way in setting up a flagship store on Shanghai's riverfront Bund, just about all the big names now have boutiques in the trendy districts of Shanghai and Beijing.
China is the latest, biggest frontier in the luxury goods market, with India and Russia close behind, said Melanie Flouquet, luxury goods industry analyst for JP Morgan.
"Emerging markets are not only not insignificant but they are critical for growth going forward," Flouquet said, adding that China accounts for 5 percent to 6 percent of sales of European luxury goods, with Russia at about 3 percent and India at 1 percent, she said.
Chinese travelers have also joined the Japanese long notorious for their love of name brands as an important clientele for luxury shops in Paris, New York and Hong Kong.
"These days we need to have Mandarin (Chinese) speakers in our shops, for not all our customers speak English," said Fontanelli.
(China Daily/Agencies May 23, 2005)
