China’s beauty industry is overdue for consolidation. You need look no further than the cosmetics section of a major department store. Some brands are thriving, but others are zombies supporting a small army of bored salespeople.
Month: September 2017
Chinese consumers in the world’s fashion capital spend more than those from any other country, with 37 percent of their budgets slated for shopping, 18 percent for food and gastronomy and a mere 3 percent for visiting museums and historic sites.
This is not just about Paris, but about how luxury shopping and international travel are inexorably intertwined in the minds of a great many Chinese tourists.
Proof: Paris is not alone. The same applies to Milan, New York, London, Beverly Hills, and any city where Chinese tourists gather. Walk into anything larger than a boutique at the Forum Shops at Caesar’s Palace in Las Vegas, for example, and there will almost inevitably be a Chinese-speaker on duty behind the counter.
The lesson for brands: Chinese are global consumers seeking experience and authenticity. The old formula of name+bling+advertising is dead, and the brands that fail to notice that are heading for hard times in China.
In a major relief for the Indian government and consumers, crude palm oil (CPO) prices are likely to decline by nearly 15 per cent before the end of 2017 due to bumper supply from Indonesia and Malaysia, the world’s two largest producers of the oil
A fall in demand of palm oil wouldn’t be a bad thing for the world. Of all of the vegetable-based oils, palm is one of the least healthy, and it tends to get dumped on price-sensitive consumers around Asia.
India is the world’s largest market for palm oil. China held that title as recently as 2009, but as incomes have risen, palm oil has been discarded for a mix of healthier cooking oil alternatives.
China is the harbinger of a bigger trend, and Malaysia and Indonesia should be concerned: this is the beginning of a long-term secular decline in a key commodity.
“It would be a big mistake to adapt to a market,” [Patek Philippe owner Thierry Stern] told the Straits Times in an interview. “If people like Patek Philippe, it’s because they like the design and the philosophy of the brand. If you start to adapt yourself to every market, you are going to lose that.”
Thierry should be lauded for not adapting Patek-Philippe for China. This is a man who understands the problems that arise when you start pandering to your market rather than catering to it.
That said, not every company shows up in China with a Patek Philippe brand cachet or customer base, and few brands could get away with imitating Stern’s strategy.
The lesson to learn from Thierry Stern’s approach is that the decision on whether or not to adapt your strategy, your product, or your entire company to China has to be based on a clear understanding of your appeal with Chinese consumers, as well as a recognition of what you might lose globally by making compromises for a single market.
PARIS (Reuters) – French fashion brand Louis Vuitton, part of luxury giant LVMH (LVMH.PA), said on Friday it had launched an e-commerce website in China to tap a booming online shopping market.
Posited: That if your product can be sold online and you’re doing business in China, you need an e-commerce channel. Or two.
Some very smart people I’ve been talking to in Beijing believe that the best marketing in China is built with e-commerce rather than advertising at its core. Naturally, this does not apply as easily to some companies/products as it does to others.
But I keep this mantra close at hand because it reminds me that I spend too much time seeing marketing as one “P” (promotion) and not four (product, price, promotion, and place.) It also reminds me* that the only marketing that matters is the marketing that either sells more product or makes it possible to sell more product.
* I know, we’re marching through no-brainer country, but these things are easy to forget when you spend sixty to ninety hours a week with your head in “promotion” mode.
Prediction of the week: by the time the investigation into the business dealings of Jared Kushner and his family by the DoJ and/or Congress is complete, the writing will be on the wall for the entire EB-5 program.
There has always been an ugly side to EB-5, but it has managed to stay beneath the surface. Thanks to Kushner et al, it rises like a kraken from the depths, and will incite the desire of men to slay it.
I hear a lot these days about the ostensible “comeback” in China’s luxury market. LVMH’s recent results suggest more aggressive marketing and a possible dead-cat bounce more than a sudden return to the luxury market.
The social fundamentals in China are changing luxury consumption patterns, and possibly for good. So the luxury market in China is not coming back – it is changing, moving on, evolving.