Shortly before heading over to Apple to become the first female to serve in the company’s c-suite, former Burberry CEO Angela Ahrendts stated that China’s luxury slowdown should be considered “the new normal” for luxury brands.
In response to that statement, CNBC asked Gouten Consulting Director and China luxury expert Francis Gouten what he thought of the future of China’s luxury market in relation to the government’s ongoing crackdown on corruption and slower GDP growth. According to him, the luxury slowdown is more of a matter of changing consumer taste to which brands must adjust. “Never forget, the national sport for Chinese is still shopping,” he says in the video. “I think the consumer[s] are changing; the people today know a lot about the brands. … They know the products, they know the quality, they want to understand the history of the brands.”
Gouten states that as a result of the slowdown, brands have stopped opening stores as quickly in China to “reinforce their flagship stores,” and although Chinese luxury shoppers are buying less in China, “they still buy outside.” However, he recommends that flagship stores in China are still as important as ever, because if customers can’t access stores in the country, they will be less likely to visit the brand abroad. Watch the video above for more of his advice.