Boston Consulting Group Survey Backs Up Recent Findings That China Should Overtake Japan As Largest Market In 5-7 Years
Last year, surveys by Bain & Co., McKinsey, the 21st Century Business Herald and others indicated that the Chinese luxury market was a rare star performer in 2009, with the 12% growth reported in the mainland looking particularly rosy in comparison to the 16% and 10% respective drops in the US and Japanese markets. Discussing the results of the Bain study, Milan-based industry expert Claudia D’Arpizio gave luxury executives reason to be optimistic about the sustainability of their operations in the Asia — and specifically China — market, saying, “Aspirational luxury shoppers in Asia and other emerging markets are fueling sales growth in 2009…They remain bullish on brands.”
According to other observers, this “bullishness” translates to enthusiastic, conspicuous consumption — going against the trend of low-key consumption we’ve seen in more developed (but shrinking) markets like Japan and the U.S. over the past few years. As David Wolf, president of China-based corporate advisory firm Wolf Group Asia told Reuters, “In a world increasingly preoccupied with sustainable consumption, China is the last great bastion of bling, not only luxury but flashy luxury.”
This week, the Boston Consulting Group released the results of their survey of over 2,500 Chinese consumers, projecting that China should overtake Japan to become the world’s largest luxury market within five to seven years. This shouldn’t be too surprising, since many other analysts made the same prediction in late 2009 when China officially overtook the U.S. to become the world’s second-largest luxury market.
Goldman Sachs recently forecast that China’s luxury spending spree will continue to gain steam in the next few years, with the country consuming around 29% of the world’s total luxury goods by 2015, and research by the Hurun Report and others indicates that China’s growing number of high net worth individuals show little sign of luxury fatigue. All very good news for stressed-out luxury executives — at least in that part of the world.