The Anglo Effect: U.S. and British Luxury Brands Gain Ground With China’s Rich

According to the results of a recent survey, Tiffany & Co. is Chinese consumers' favorite American luxury brand and their third favorite jewelry brand. (Courtesy Photo) While European luxury brands have been longtime favorites in China, iconic labels hailing from the United States and the UK are gaining a growing amount of influence over Chinese shoppers’ hearts and wallets. According to recent survey results released by the Hurun Report, iconic jewelry brand Tiffany & Co. is the number one American luxury brand for Chinese high-net-worth individuals (HNWI), while Burberry tops the list of UK brands. These labels aren’t just popular stacked up against their domestic rivals—they’re also holding their own against French and Italian luxury stalwarts. For the first time, Tiffany made it on to the list of Chinese consumers’ top three favorite jewelry brands globally, coming in behind Bulgari and Cartier (in addition, fellow U.S. jeweler Harry Winston wasn’t far behind in 11th place). Meanwhile, Burberry came in third on the list of top fashion labels for women behind French giants Chanel and Dior, and was named among the top five fashion labels for men. Another major American “luxury” brand made waves when it was named at the top of Hurun’s global “best brands for gifting” category: Apple. Although the list is dominated by French and Italian brands, Tiffany maintained a seventh place position in the “best giving” category for women. A promotional Chinese New Year image by Burberry promoting its special holiday collection. (Courtesy Photo) The rise of these "Anglosphere" brands to unprecedented prestige in the traditionally Europe-dominated Chinese luxury industry can be attributed to several key factors. One of the most important of these is travel, as a growing number of China’s wealthy flock to the United States and the UK to witness these brands in their element. According to Hurun Report Chairman and Chief Researcher Rupert Hoogewerf, “With seven out of 10 purchases of luxury now being made outside of China, this makes influencing the luxury Chinese consumer in their home country before they travel of paramount importance.” The UK made it onto the survey’s list of the top 10 travel destinations for China’s wealthy this year, marking the first time it has done so since 2012. Meanwhile, the United States comes in ahead of the UK in seventh as rich Chinese investors continue to view it as a prime location to purchase real estate. U.S. and UK brands—especially Tiffany and Burberry—are also often more open to embracing digital marketing efforts than many traditional European luxury brands, which have long been fearful of hurting their high-end image online (especially when it comes to e-commerce). Last year, Burberry and Tiffany were both listed as digitally “gifted” on L2 Think Tank’s annual ranking of the luxury brands with the best digital strategies in China, coming in at fifth and 12th on the list, respectively. Tiffany has focused on mobile marketing in China with both a highly developed WeChat account and its own platforms, including its popular “Engagement Ring Finder” app. Meanwhile, Burberry became one of the first ever luxury brands to open an official store on Alibaba’s Tmall platform last year in addition to heavily developing its WeChat presence and launching multiple innovative campaigns on the platform. Chinese consumers’ shifting preferences when it comes to favorite luxury brands (and, in the case of Apple, changing ideas of what constitutes “luxury”) can be seen as a source of opportunity for high-end labels despite China’s ongoing luxury slowdown. The brands that are making headway with Chinese consumers aren’t necessarily always those with the longest history, but rather those that are able to strike a balance between staying true to their iconic heritage and adapting to rapidly evolving tastes and habits in the China market—both online and offline.

The Anglo Effect: U.S. and British Luxury Brands Gain Ground With China’s Rich

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Published February 16, 2015

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The Anglo Effect: U.S. and British Luxury Brands Gain Ground With China’s Rich