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    Revisiting The Prospects For "No Logo" Luxury In China

    Are wealthy Chinese shoppers really starting to forego Louis Vuitton and Gucci for lesser-known, less ostentatious brands?
    Jing DailyAuthor
      Published   in Fashion

    Richemont Group CEO Says Chinese Shoppers Looking For Brands "That Are Not Necessarily On The Top Of The Radar Screen"#

    Chloe released a low-key China anniversary edition handbag last fall

    Are wealthy Chinese shoppers starting to forego Louis Vuitton and Gucci for lesser-known, less ostentatious brands? That was the contention of Richemont Group CEO Geoffroy de la Bourdonnaye last week in Shanghai, where Richemont-owned Chloe held its Fifth Anniversary runway show, the company's largest China event to date. Speaking to the AFP, de la Bourdonnaye said that while "China has been very fast at picking up the most well-known brands," China's more sophisticated consumers are "now looking for the brands that are not necessarily on the top of the radar screen. They're looking for new interesting brands that bring something that other brands don't bring." Looking to bring low-key luxury to more of the country's emerging second-tier cities, Chloe will open four new boutiques in China over the course of this year, adding to the 10 it currently operates, with stores planned for cities like Nanjing and Xi'an.

    But is "no logo" luxury really set to take off in status-obsessed China?

    If you listen to execs from some of the world's top luxury brands, whether China is ready is almost of secondary importance, as the transition towards less visible logos is already well on its way. As Francois-Henri Pinault, chairman and chief executive of Gucci's French parent company PPR, said last summer: “Our groups are moving toward fewer logos, more discreet luxury. It’s a question of adapting our ranges very rapidly to this new perception of luxury, a luxury which is more subtle, more sophisticated.” However, as Jing Daily pointed out for the Forbes China Tracker last August, less logo-forward collections at Louis Vuitton in Shanghai were met with a comparatively cool reaction from shoppers:

    [According to a clerk at Shanghai's Lippo Plaza,] The most popular items "are still those ones that have a prominent LV logo.”



    [One industry insider] recently said that when Chinese consumers purchase a luxury item, they’re not just buying the product but are paying for all of the added value denoted by this object — identification of status, display of economic power and so forth.



    Cheng Shi’an, the head of Fudan University’s Advertising Department in Shanghai, believes that luxury brands rely on the “periphery effect” (外围效应) [in China]. If a luxury buyer’s coworkers and friends can’t tell the price of the brand, even if this person spent a lot of money on a given item, their satisfaction level will still be low.

    Geoffroy de la Bourdonnaye: "We have to be selective. We don't want to over-expose ourselves" (Image: AFP)

    Despite the power that the "periphery effect" still has in dictating luxury trends in China's handbag market -- for men as well as women -- it seems that more of the country's more sophisticated types are downplaying their purchases rather than going fully logo-free. From the AFP:

    [W]hile handbags are traditionally used to broadcast one's success and good fortune, this too may be changing as more and more women join the designer-toting club.



    [Amanda Lee, who writes the Hong Kong-based blog Fashionography] herself has a denim Chanel bag, a gift from family -- but carries it "so that no one sees the double C (logo)", she said.



    "People would know (who the designer was) already if they were really into Chanel, from the shape and so on, but I feel like there's no need to let the entire world know."

    Whether we start to see more high-end devotees flipping their purchases around and relying on the brand savvy of others to satisfy their urge to be seen and envied is anyone's guess. What is certain is that a trend toward low-key and logo-less luxury at boutiques in Europe or even Hong Kong will translate to more of these products seen on the streets of Beijing, Shanghai and Shenzhen, since wealthy shoppers in these cities are the most likely to take excursions to these destinations with shopping in mind. However, the same can't necessarily be said for China's inland cities, where brands like Chloe are currently planning greater expansion. Typically less educated and still in the throes of a love affair with label-amplifying brands, it could take years for consumers in cities like Wuhan, Dalian and Xi'an to choose Chloe over Chanel.

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