March 26 (Bloomberg) -- Craftsmanship ranks highest among words wealthy Chinese choose to define luxury, according to Mintel, underscoring changing tastes among big spenders.
Almost two-thirds of urban Chinese put the term ahead of “expensive” and “status,” the market-research company said in a study released today. The portion rises to 71 percent for those with monthly household income of more than 25,000 yuan ($4,000), Mintel estimates.
“Though status is still important to the Chinese luxury consumer, the trend toward luxury consumption for one’s enjoyment is clear,” Matthew Crabbe, Mintel’s director of Asia Pacific research, said in a statement. “The wealthier a consumer is, the more likely he or she is to appreciate luxury goods for their innate quality and value.”
Louis Vuitton, Gucci and other European luxury brands are touting their artisanal skills and introducing more expensive products in a bid to move upscale amid softening demand in Europe and Asia. The shift, often accompanied by fewer store openings and more precious materials, is designed to restore a veneer of exclusivity after years of churning out logoed handbags that were snapped up by shoppers around the world.
Shoppers in China are increasingly willing to explore new brands, Mintel said. While foreign labels are still considered superior in watches and cosmetics, about 40 percent of Chinese believe local luxury clothing and shoes provide the same quality, according to the researcher. Chinese shoppers accounted for about 61 billion euros ($84 billion), or 28 percent, of 2013 global luxury sales, consulting firm Bain & Co. estimated in a January report.
“There is a growing consciousness that, in many cases, Chinese brands are able to offer craftsmanship and design to a level that is on par with or above foreign brands,” Crabbe said. “We expect to see a growing segment of the Chinese luxury shoe and clothing markets in particular to be occupied by Chinese brands in the coming years.”
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