Luxury labels in China are slashing prices to unprecedented levels due to unsold inventory and declining consumer spending. Starting this month, Balenciaga’s Hourglass handbag is discounted by 35% on Alibaba’s Tmall, cheaper than on global sites. The brand, part of Kering, offered 40% discounts on average in early 2024 and increased discounted products on Tmall. Other brands like Versace, Givenchy, and Burberry have also cut prices, with Versace’s discounts rising to over 50%. This trend highlights the severe economic slowdown in China, affecting luxury sales and prompting unusual public discounts on major platforms like Tmall. High return rates due to promotional campaigns add to the brands’ challenges. While top-tier brands like Hermès and Louis Vuitton avoid discounts, relying on wealthy customers, frequent price cuts can harm a brand’s exclusivity. As online orders make up nearly half of China’s luxury revenue, faltering demand has significantly impacted profits for brands like Kering, Burberry, and Chanel.