Auto Brands Dominate In Top 50 Ranking
This week, the Luxury Society and Digital Luxury Group released their new index of the top 50 most-search-for luxury brands in China. The first installment of the World Luxury Index, the ranking covers more than 400 brands within six key segments (fashion, beauty, jewelry, cars, watches and hospitality), indexing based on inputs using top search engines such as Google and Baidu. While there are few surprises on the list, as auto brands dominate, as in other rankings such as last year’s L2’s Prestige 100 China IQ Report, some unexpected brands do show up.
According to the study, 18 of the top 50 most-searched-for luxury brands in China, or 36 percent, are auto brands, unsurprisingly led by Audi, BMW and Mercedes-Benz. Though no real shocker to anyone following the China luxury market, as auto brands have been among the most aggressive in terms of advertising and expansion in China over the past 20 years, it does show that market potential for major auto brands remains strong among younger consumers in the country. In terms of fashion houses, again, Louis Vuitton — which has operated in mainland China since 1992 — is the most searched-for fashion brand and #3 luxury brand overall, followed by Chanel (#5) and Dior (#8). Interest for Dior is linked mostly to beauty, however, with more than 80 percent of Dior searches related to its cosmetics and fragrances. For Chanel, though, its beauty segment represents less than half of searches. For Louis Vuitton, 94 percent of searches were related to fashion & accessories, indicating that its luxury watch division has its work cut out in mainland China.
One interesting finding is that the Hong Kong brand Chow Tai Fook is the most searched-for jewelry brand in China, followed by Cartier and Swarovski. Though, with more than 1,500 locations in 320 cities throughout the Greater China region, this isn’t a jaw-dropping finding, it’s surprising that brands such as Tiffany & Co. that are in the midst of major expansion and marketing efforts weren’t more highly ranked.
Another interesting aspect to the study was the fact that Chinese consumers don’t uniformly search for luxury brands using the same Chinese-language transliterations. According to the ranking, when searching for “Burberry,” 76 percent of Chinese consumers used the brands unofficial Chinese name — 巴宝莉 or Ba bǎo lì — while only 15 percent used its official Chinese name (博柏利, Bó bǎi lì) and nine used its English name. For other brands with longer and more difficult names for Chinese consumers, such as Louis Vuitton, abbreviated names or acronyms are more widely used. In searches for Louis Vuitton, 63 percent were for “LV” rather than “Louis Vuitton.” Though the brand isn’t ranked, we’d expect similar numbers for searches of “DVF.”
Though “big brands” proliferate on the ranking, a few outliers indicate that Chinese consumers are gradually widening their awareness of more niche luxury brands. Just as Japanese and Korean luxury shoppers moved beyond LV and Gucci in the 1980s and 1990s, China’s more sophisticated shoppers are increasingly searching for brands such as cosmetics label Borghese, whose face masks are developing a cult-like following in top-tier Chinese cities. The French outerwear brand Moncler, which currently has only seven locations in six cities in mainland China, is ranked 42nd on the list, beating the likes of Rolex and Ferragamo. American brand Anna Sui, despite a very niche fashion presence in the Chinese Mainland (with only one location in Hangzhou), is ranked 47th, owing to its massive beauty presence. Currently, Anna Sui operates 31 beauty counters in 16 cities.
While the study doesn’t delve too deeply into what actually drives these consumers to actively search for a given brand — television, print, Weibo, friends, etc. — it does give some valuable insight into the evolution of brand knowledge in China. A few years ago, we’d expect the list to be filled from start to finish with the brands that have the most locations and most expensive ad campaigns in China. But now, with brands like Guerlain, Anna Sui, Moncler and InterContinental ranked among the likes of Coach, BMW and Hermes, we can see that getting into the minds of Chinese consumers takes more than a huge presence in the country and ubiquitous marketing campaign.