In 2020, in China, bag sales have been considerably increasing by 70 to 80%. Together with jewellery, leather goods are, among luxury goods, the sector which most enjoyed a boost throughout the year, deeply hit by coronavirus outbreak and the pandemic. According to a joint report, provided by Bain and Tmall, China’s luxury goods market is bound to go up by 48% this year, therefore reaching 52.8 billion US dollars. Online sales are going to account for 23% of the overall shopping expenditure: they used to account for 13% in 2019. The Hainan duty free market alongside parallel imports will also drive the business acting as propellers.
The value of China
This year China, as highlighted in the report made public by WWD, will supposedly redouble its business share in the luxury global market as it is going to reach 20%. As is known, since Chinese buyers cannot travel abroad due to coronavirus restrictions, they consequently go shopping in their own country.
And they purchase online, by using their smartphone. Such new attitude, according to Bain, is going to be permanent.
“Nearly 40% of interviewees have stated they are planning to augment their luxury goods online shopping in the next few years – as pointed out in the report –. According to 40% more, instead, their online shopping share is going to remain the same as at present”.
According to Bain, brands currently operating in China “have at least one year, or maybe two, to conquer buyers and make them believe that home shopping is a more valuable and sustainable experience”.
In fact, even though travel restrictions are going to be progressively lifted, Chinese still look apparently cautious about their travelling options. Bain analysts assume that things will not go back to normal sooner than 2022, or even 2023.
Furthermore, in Hong Kong sales are quite unlikely to get back to their usual standards prior to Covid-19 crisis. Looking at this scenario, a vast majority of luxury brands therefore expect earnings will increase by 30% next year as well.
Like we said earlier, leather goods and jewellery undoubtedly play a leading role in the luxury market: in fact, their sales have been remarkably rising by 70 to 80%. As regards apparel and footwear, instead, revenues have gone up by 40 to 50%. Likewise, in the isle of Hainan duty-free sales have been enjoying a smart boost: in fact, they will increase by 98% compared to 2019.