Hong Kong Is #1 In Retail Spending On Fashion And Luxury, Worldwide, With 90% Of Global Brands Having Presence There
A new study released this week by CB Richard Ellis, “How Global is the Business of Retail?” sees three of China’s marquee cities — Hong Kong SAR, Beijing and Shanghai — among the world’s top ten ranked by global retailer presence, with Hong Kong maintaining its top position as Asia’s largest luxury and fashion retail market. According to the study (Chinese), Hong Kong was ranked fifth globally, with Beijing sixth and Shanghai in eighth place, with all three cities presenting real challenges to established global centers on the strength of Chinese luxury consumers, whose lavish spending has seen the world’s major luxury and fashion houses trip over themselves to increase their Chinese presence.
Despite the global downturn that saw luxury spending among Western shoppers remain anemic over the past 18 months, London — likely helped by deep-pocketed tourists, many from China — held onto its top spot this year, although Dubai comes in at a close second place and could top the list as soon as next year.
“The Chinese market has began to challenge the conventional ones of international brands, and this can also reflect Chinese consumers’ continuous changes in demand and tastes,” Ma Xueming, board director of the research department of the CB, said.
According to the report, Hong Kong maintains its position as the world’s largest luxurious brands and fashion retail market. The report covers 47 luxury brand retailers, and Hong Kong attracts 90 percent of those brands.
In Asia, Hong Kong is the largest retail market, followed by Beijing, Tokyo and Shanghai. All these four are included in the world’s top 10.
The Asian market (excluding Japan), made up 28 percent of LVMH 2009’s total revenues, which has made it the largest market for the firm in the world. The Chinese market contributed to a large part of the percentage.
Commenting on the results of the study, Bryn Davies, CB Asia’s board director, said that the European market has presented a serious challenge for many European retailers over the past year, yet China was “the first choice” for those companies looking for global expansion to offset dropping demand at home.
“China’s large population and its growing affluence cannot be ignored, compared with the wealthy, but stagnant western market The growth and performance of those brands who have entered the Chinese market attract other retailers who have few or no stores in China,” he added.
While this report might be a bit opaque for our taste, and doesn’t take into consideration where the luxury spending in these retail markets actually comes from — since, as noted earlier, a good chunk of the retail sales in cities like New York, London and certainly Dubai come from tourists — it is still valuable in that it recognizes the growing importance of Chinese cities (and the Chinese middle class, which spends more at home than the wealthy elite) in the global retail landscape.
2010 Global Rankings Top 10 Cities:
1. London (Attracting 56% of global retailers)
2. Dubai (55%)
3. Paris (46%)
4. New York (44%)
5. Hong Kong (43%)
6. Beijing (41%)
7. Tokyo (40%)
8. (tie) Shanghai (40%)
8. (tie) Moscow (40%)
10. Madrid (39%)