Op-Ed | Chinese Consumers and Logos: an Endless Love Story?

Are logos really coming back? The issue may be more complex than we think. (Shutterstock)

Are logos really coming back? The issue may be more complex than we think. (Shutterstock)

Over the past few years, market research has agreed that Chinese luxury consumers were getting more informed and savvier than ever regarding luxury goods.

Showing off one’s wealth with ostentatious logos was turning old-fashioned and only reserved for the tuhao (土豪), China’s newly rich.

In this context, Gucci CEO Marco Bizzarri’s declaration last month saying that “Chinese consumers were not ashamed to wear logos” had the effect of a bomb. Does Gucci’s unexpected renaissance in China after years of slowdown prove that logos are coming back? Or is this only an epiphenomenon?

Let’s take stock of the situation and see which conclusions to draw from this declaration.

At first sight, Marco Bizzarri’s comment goes against the majority of statements made over the past few years within the industry.

As Gildo Zegna—CEO of the eponymous brand—said, “there’s one thing the industry has to watch happening in China, which is logo fatigue.”

After the last two decades of intense consumption, the Chinese audience tends to favor a more understated luxury, valuing niche brands and discreet designs over loud patterns and showy logos.

As a matter of fact, local consumers are more and more looking to differentiate themselves by conveying a distinctive lifestyle and demonstrate their upscale knowledge. Self-fulfillment is today more important than ever.

It is to meet this need that major luxury brands increasingly design cultural experiences, like Louis Vuitton did with its exhibition dedicated to architect Frank Gehry in Beijing last year.

Although daring, Gucci’s CEO’s statement actually echoes China’s recent craving for an affordable yet gaudy luxury, embodied by brands like Tory Burch and Gucci.

Michael Kors, a leading actor in the category, is currently recording astonishing performances with “double-digit comp store growth in the second quarter of 2015.”

In fact, an important part of Chinese consumers still choose a brand because of its popularity and doesn’t see the point of preferring a not-so-famous-brand.

In a report published last month, Baidu ranked leaders Hermès, Giorgio Armani, and Burberry as the three most-searched fashion brands on the search engine. In that case, a logo is one of the codes (along with its name, colors, designs…) that a brand can rely on to enhance its recognition. Does this mean that brands need to swear by their logo alone? Obviously not. The answer may be subtler.

China’s highly competitive luxury market is home to endless types of brands with as many different identities, to meet the needs of a multitude of consumers. In a report released last March, Jing Daily and Carat identified no less than five different luxury groups, from the “Bling King” to the “Connoisseur.” The China market is thus big enough to welcome strategies as different as those of Gucci and Zegna.

One single brand can also choose to target several profiles. It is for instance the strategy followed by Ralph Lauren that develops an “affordable” Polo line showcasing the brand’s famous logo, along with Purple Label featuring refined fabrics to target a connoisseur audience. It is also the case of Giorgio Armani that commercializes Armani Jeans (the brand’s sportswear line boasting its characteristic logo) and Armani Collezioni based on more noble fabrics.

In the particularly competitive Chinese market, the profusion of brands has nurtured a multiplicity of well-informed consumer profiles that each has specific tastes and fast-changing needs.

In fact, each brand, via strategic planning, has the important—and essential— assignment to identify its right profile(s) of consumer(s). It is only after identifying the profiles they reach out to that brands will be able to deploy an offer adapted to each Chinese audience and thus, allocate the right place to its logo.


Rémi Blanchard is Strategic planning manager at Mazarine Asia Pacific, an agency dedicated to advising luxury brands in their communication strategies all over Asia.

Categories

Consumer, Market Trends