Upscale Caterers, Baijiu Makers Will Be Hardest Hit By New Edict
The Chinese government continues its crackdown on lavish official banquets today, this time with a front-page article on today’s issue of People’s Daily that goes after “low-key luxury” (低调的奢华) in response to a recent exposé done on local officials caught in the act of breaking new regulations in Jiangsu. The brands hardest hit by this directive will be those associated with the official “banquet culture” that has been under attack for several months now.
“Low-key luxury” describes “the use of public money for banquets switching from being visible to going underground,” says the report. It also states that some “sly” officials have resorted to holding saunas in farmhouses and hiding expensive baijiu in ordinary-looking water bottles in order to maintain their lavish lifestyles.
The crackdown on official banquet culture has already hit high-end baijiu companies, which have been trying for the first time to market the fiery liquor overseas in order to make up for losses.
The term “low-key luxury” is not necessarily related to the rise of “stealth wealth” in Chinese fashion. The move away from logo-heavy products in the Chinese luxury market may certainly be influenced by officials’ new unwillingness to publicly sport ostentatious displays of wealth, but this trend has been ongoing for most luxury consumers who have been increasingly likely to see heavy logos as less sophisticated, especially in China’s tier 1 cities.