Liz Flora of Jing Daily investigates new research suggesting that luxury prices in China have grown at the lowest rate seen in seven years
CONSUMERS
China’s Luxury Price Growth Stagnates To Seven-Year Low
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Over the last decade, collaborations between luxury brands and contemporary artists have gone beyond mere artistic partnerships towards a new kind of luxury branding.
PARIS – Art and fashion have always developed side by side, for fashion, like art, often gives visual expression to the cultural zeitgeist. During the 1920s, Salvador Dalí created dresses for Coco Chanel and Elsa Schiapparelli. In the 1930s, Ferragamo’s shoes commissioned designs for advertisements from Futurist painter Lucio Venna, while Gianni Versace commissioned works from artists such as Alighiero Boetti and Roy Lichtenstein for the launch of his collections. Yves Saint Laurent’s vast art collection, recently auctioned at Christie’s in Paris, testified to his great love of art and revealed the influence of a variety of artists on his own designs.
In the 1980s, relationships between luxury brands and artists were advanced when Alain Dominique Perrin created the Fondation Cartier. In the Fondation Cartier pour l’Art Contemporain, a book marking the foundation’s 20th anniversary, Perrin says he makes “a connection between all the different sorts of arts, and luxury goods are a kind of art. Luxury goods are handicrafts of art, applied art.”
The Fondation Cartier pour l’Art Contemparain building in Paris
Liz Flora of Jing Daily investigates new research suggesting that luxury prices in China have grown at the lowest rate seen in seven years
Mainland China’s luxury prices may be astronomically high compared to those of the United States, Europe, and Hong Kong, but they’ve grown at the lowest rate seen in seven years, according to a new report.
Late last week, the Hurun Report published the Chinese version of its annual Luxury Consumer Price Index (CPI), which found that luxury prices have grown by 1.52 percent, a decline of 3.42 percent from last year and a seven-year low overall. The rate was lower than both that of inflation and of the general CPI for the country.
“Driven by consumer demand, luxury prices were increasing fiercely in the past few years, but that momentum seems to have come to a halt this year. The main reasons are China’s economic slowdown and the fight against corruption,” said Hurun founder Rupert Hoogewerf.
“ Luxury prices in China have grown by 1.52%, a seven-year low ”
Taking a closer look at the report’s findings for each individual sector, it is clear that heavily “gifted” items which have disproportionately suffered as a result of the crackdown have also seen the lowest price growth rates, and some of them have even gone into negative territory.
Alcohol and smoking products declined the most at negative 1.85 percent, a number dramatically affected by Moutai baijiu, which declined by a stunning 14.58 percent. Watches and jewelry also had it particularly hard, with a decline of .85 percent.
The prices of luxury watches, jewelries, properties and luxury apartments in Shanghai, Beijing and Nanjing have declined since last year while that of gold in China plunged 5% due to declining international gold price.
“ Driven by consumer demand, luxury prices were increasing fiercely in the past few years ”
Growth of luxury goods prices have almost stalled this year due to slower economic growth and anti-corruption policy. The prices increased rapidly over the past few years due to rising consumer demand, said Rupert Hoogewerf, publisher of the Hurun Report (China Times).
Meanwhile, other consumer goods not as reliant on gifting income fared much better than their counterparts. Car prices were up 4.15 percent, leisure activities grew by 3.56 percent, and beauty and skincare increased 4.63 percent. Travel was the category with the highest jump of 6.23 percent.
The methodology of the study involves a survey of the prices of 77 items across China’s luxury industry. Out of these items, 13 saw a drop in price and 28 saw a rise in price, while 36 stayed the same.
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Editor, Jing Daily
Liz Flora is the Editor-in-Chief at Jing Daily. Jing Daily is the leading digital publication on luxury consumer trends in China.
