CHINA NEWS BRIEF: 5 March 2024

    Prada, Gucci, Bottega Veneta, Supreme roll out new retail spaces; Deflation stalks China; Retail sales in Hong Kong soften.
    Prada aims to entice domestic tourists with its new duty-free store in Hainan. Photo: Prada
    Jing DailyAuthor
      Published   in News

    Prada opens duty-free boutique#

    Prada unveiled a new boutique at China Duty Free Haikou International Duty-Free City on March 1. Spanning two floors and covering nearly 580 square meters, the boutique offers a range of men’s and women’s clothing, leather goods, footwear, and accessories. Featuring a curved glass facade with the iconic Prada triangle, the interior showcases signature elements such as black-and-white checkered marble flooring and classic green accents on sculptural walls.

    Gucci to launch pop-up campaign#

    Gucci Ancora offline spaces will simultaneously open in four cities in China: Beijing, Shanghai, Chengdu, and Shenzhen from March 11 to 17. Following Creative Director Sabato De Sarno’s debut in Milan in January, the offline spaces will showcase the Italian aesthetics of Gucci’s 2024 Spring/Summer collection.

    Bottega Veneta unveils pop-up#

    Bottega Veneta unveiled its new pop-up store at the Shanghai Henglong Plaza on March 1. Olympic diving champion Guo Jingjing, actresses Dong Jie and Zhou Yutong, idol singer Mika, and table tennis Olympic champion Xu Xin attended the opening ceremony and reception. In conjunction with activities to mark the occasion, the brand’s WeChat platform launched an artificial reality game mini-program, inviting users to experience virtual interactive adventures around the pop-up store.

    Supreme readies 1st store in China#

    Even though Supreme long lost its former glory, the arrival of its first store in China is still a big deal in the eyes of local trend enthusiasts. The location of Supreme’s store had already become an “open secret,” with many trend enthusiasts flocking to the giant white fences surrounding the construction site. Recent on-site photos show that numerous large posters have appeared on the construction fences, replacing blank ones. The store is located at 291 Fumin Road and is Supreme’s 17th store globally. It is rumored to open at the end of this month or beginning of April.

    Deflation stalks China#

    China experienced unique deflation in 2023, which persists into 2024 due to a real estate crisis and broader economic challenges. Consumer prices dropped by 0.8% YoY in January, marking the steepest decline in 15 years. This trend, attributed to factors like industrial overcapacity and a real estate recession, impacts household incomes, corporate earnings, and government taxes. The ongoing slump in the real estate market has further depressed prices for household items and residences, with home sales dropping by 6.5% last year. Expectations of further deflation are likely to cause consumers and investors to reduce spending, exacerbating debt overhang and negatively impacting investment and consumption.

    Retail sales in Hong Kong soften#

    Hong Kong retail sales saw a modest increase of 0.9% in January, a slowdown from the revised 7.8% rise in December, attributed in part to the timing shift of the Lunar New Year. Government officials suggest combining January and February data for a clearer picture. Visitor arrivals, improving tourist capacity, and upcoming events are expected to support retail businesses, along with rising household income and government efforts to boost consumption sentiment. Jewelry, watches, apparel, furniture, and books saw growth, while supermarkets, food, alcohol, electrical goods, and department stores experienced declines.

    Hong Kong relaxes real estate curbs#

    Hong Kong last week announced measures to boost its struggling real estate sector, including the immediate removal of property-buying restrictions and stamp duties. These measures aim to revive the economy amid challenges such as a sluggish housing market and a record talent exodus. Despite initial gains after reopening post-pandemic, Hong Kong faces further economic challenges, including a struggling stock market and geopolitical tensions.

    Visa policy buoys travel demand#

    Data from Chinese online travel agency Qunar, shows that despite the end of the Spring Festival holiday, the popularity of outbound travel remains high, with searches for flights to Thailand increasing by nearly 70% in the past week after a visa exemptions policy took effect on March 1. Since the Lantern Festival, flight prices have returned to off-peak levels, stimulating noticeable demand from travelers. According to Qunar’s booking data, domestic flight passenger volumes are close to those of the 2023 summer peak, while outbound flight passenger volumes in early March are also approaching those of the Spring Festival holiday.

    Coach names new China head#

    The American Tapestry Group yesterday appointed Liliana Lucioni as President of Coach’s China division. Lucioni will oversee Coach’s operations in the country. She has held senior roles at brands like Saint Laurent and Prada, and holds a degree in Chinese art and language literature from Beijing Language and Culture University and Fudan University.

    APAC propels Puma’s financials#

    On February 27, Puma released its 2023 performance data. Revenue increased 1.6% to $9.64 billion (€8.60 billion). The Asia-Pacific region led growth, with a 13.6% YoY increase in sales. Puma implemented a “China-for-China” strategy in 2023, enhancing its local relevance and rebuilding its market organization in China. By 2024, 40 percent of products sold in China will be locally designed, and 80 percent locally produced.

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