In “Chinese Whispers”, we share the biggest news stories about the luxury industry in China that haven’t yet made it into the English language.
In this week’s edition, we discuss:
- Gucci lowering its retail prices after Louis Vuitton’s price cut earlier this week,
- The Chinese parents behind Generation Z’s fashion splurges, and
- The former CEO of Sandro is rumored to be Lanvin‘s new chief exec.
1. Gucci Cuts Retail Prices in China – LadyMax
Following the decrease in import duties in China, Italian luxury brand Gucci announced on July 6 that it would cut prices by an average of 5 percent in the country’s direct-to-consumer retail stores, according to an exclusive report by the Chinese fashion outlet LadyMax. The move came after Gucci’s major rival Louis Vuitton dropped retail prices by 3 to 5 percent on July 3.
In a bid to drive domestic consumption in recent years, the Chinese government has been busy rolling out a series of measures to lower import duties on consumer goods. The Ministry of Finance announced its latest round of cuts on May 31 this year, applying to 1,449 categories spanning across luxury, fashion, beauty and other sectors. The reduction officially came into effect on July 1, 2018.
2. Chinese Parents Fund the Gen-Z ‘s Fashion Dream – Gold Standard Research Center
Nearly 60 percent of China’s Generation-Z consumers use their parents’ money to purchase trendy fashion items, according to a new study released by Gold Standard Research Center in collaboration with Tencent on July 6. The study was conducted based on interviews with 4,534 Gen-Z Chinese consumers from April to June, with 54 percent of interviewees being male.
China’s Gen-Z generation has increasingly become a major force in luxury and fashion consumption in recent years. It is now critical for retailers to connect and engage with this generation to ensure profitable results.
3. Lanvin Rumors: Will Former Sandro CEO be the New Chief Executive? – Jiemian
Jean-Philippe Hecquet, the former CEO of French affordable luxury brand Sandro, is rumored to be the new chief executive of Lanvin. The French luxury heritage brand was recently acquired by Chinese conglomerate Fosun International. Chinese news site Jiemian also claimed that Haider Ackermann – who departed from Berluti in March this year, Serge Ruffieux from Carven, and Simon Porte Jacquemus were on the shortlist to be Lanvin’s next creative director.
Lanvin’s new Chinese owner Fosun has demonstrated big ambition in the luxury fashion industry over the past few years. The Chinese conglomerate has been on a shopping spree for high-end luxury and hospitality brands, buying up Club Méditerranée SA, Folli Follie, St. John, and more. However, industry professionals are uncertain if the acquisition will help restore Lanvin to its former profitability.