Will Chinese Luxury Shoppers Embrace The "Logo-Less" Trend?

New Collections By Louis Vuitton, Gucci, Chanel Eschew Conspicuous Logos For More Understated Look This week, Britain's Telegraph reported on the recent luxury industry trend towards subtler, "antibling" collections that minimize conspicuous logos in favor of more low-key designs. According to the article, recent moves by Gucci to downplay its trademark "G emblem" have paid off, as the company recorded a surge in profits after moving in this direction. As Francois-Henri Pinault, chairman and chief executive of its French parent PPR, said: "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." Noting the visible "de-logo-ification" seen among brands known for over-the-top embellishments in the pre-financial-crisis years, such as Louis Vuitton or Chanel, the Telegraph cites a new study by Joseph Nunes, professor of marketing at the University of Southern California, which found that big-spenders are "willing to pay a premium to have 'quiet' goods without a brand mark." So there we have it: top luxury houses are largely moving away from ostentation and flash and towards more subtlety, sophistication and "quiet" indulgence. But herein lies a serious point of contention in the luxury world. Although luxury shoppers in established, recession-stung markets may gradually be lured back into stores by understated, obvious-logo-free collections, will this trend appeal to potential buyers in emerging -- and lucrative -- markets like China, where garish still equals good? This is precisely the question asked by a number of Chinese luxury sites and blogs this week. The author of the New Express article, "Will You Still Buy Logo-Free LV?" predicts that it will be years for the logo-mad mindset prevalent in the Chinese luxury industry to change, and the ChinaNews article "Low-Key Luxury: A Hard Sell For Chinese Consumers" notes the cool reaction that many Chinese shoppers have had to understated items. The article also quotes a professor at Shanghai's Fudan University who explains the "peripheral effect" that often dictates a Chinese shopper's choices (translation by Jing Daily team): At the Louis Vuitton flagship store at Shanghai's Lippo Plaza, workers showed me that nearly all of the new products in the epi leather collection lack any obvious LV logos, instead having only a small embossed LV logo in the lower right-hand corner. Nonetheless, considering these pieces all cost more than 10,000 yuan (US$1,476), they still belong to a high-end product line. [As one clerk told me,] "The new classic canvas monogram collection isn't that popular with buyers. The most popular items are still those ones that have a very visible LV logo." A clerk at the Gucci store at Shanghai Times Square explained that the "Techno Horsebit" series, which doesn't have any obvious logos, hasn't had many buyers either. The industry insider Frederick (no further name given -- JD) 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. If this story is accurate -- and considering the tone of other articles on the subject, it seems to be -- we can expect to see new understated collections receiving a somewhat ambivalent reception from many Chinese luxury shoppers, save for, perhaps, the most experienced and brand-savvy. Major brands likely are already anticipating this, and as the Telegraph's fashion director, Hilary Alexander, said, despite the move towards subtlety that's currently sweeping the industry, "Some tourist markets, such as the Middle East, Japan and China, have still yet to grow out of the logo obsession so there will always be a little of that in the accessories but less so on the catwalk." Whether this simply means we'll see more "China-only" accessory collections aimed squarely at emerging markets like China or spin-off collections that won't be sold in Western markets is anyone's guess at the moment. If nothing else, major luxury brands have some serious decisions to make. Do they continue to make new collections with European and North American buyers in mind and assume shoppers in other markets keep buying, or do they give important demographics like wealthy mainland Chinese more of a voice? How do you take a new direction without alienating, and potentially turning off, loyal buyers in important -- but still young -- markets?

Will Chinese Luxury Shoppers Embrace The "Logo-Less" Trend?

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Published August 11, 2010

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Will Chinese Luxury Shoppers Embrace The "Logo-Less" Trend?