BEIJING: Luxury consumers in China are aware of an average of nearly 60 different brands, indicating both the category's rapid expansion and the intense competition now observable across the country.
KPMG, the advisory group, and TNS, the research firm, surveyed 1,200 urban, middle-class luxury shoppers, all of which were aged 20–44 years old. They typically recognised 59 high-end brands, up from 57 in 2010 and 43 in 2008.
A further 56% preferred well-known luxury brands and 69% proved willing to meet a premium for big name and popular offerings. This figure rose to 88% where these products were durable and of high quality, and 80% for receiving excellent service.
Exclusivity and uniqueness also logged 80% on this metric, while boasting a long heritage secured 72%. Green and corporate social responsibility concerns yielded 68%, with being "very fashionable" on 67%.
Consumers owning luxury items were perceived as enjoying a "high quality life" by 58% of the sample, whereas 42% viewed them as being "successful" while 29% agreed it showed "good taste".
French brands were most strongly associated with the cosmetics and perfume industry, mentioned by 62% of the panel. They also led for clothing on 37%, as well as 33% for alcohol – sharing the top spot with Chinese drinks here – and 31% for bags.
Elsewhere, Swiss manufacturers were seen as the best in the luxury watch segment on 69%, and German automakers headed the charts for their sector on 57%. Chinese operators took the corresponding position for restaurants, on 33%.
In keeping with such trends, a 56% share of those polled thought leading Chinese alcohol brands would emerge in the future. Restaurants registered 41% here, beating beauty treatments on 39% and hotels or resorts on 34%.
Only 13% held the same expectations when discussing cosmetics or perfumes, a total hitting 17% for watches and automobiles, versus 18% for bags and 20% regarding clothes.
Fully 70% of respondents researched luxury products online once a month or more. An additional 40% expressed an interest in buying them on the web, improving from 22% in 2011.
By contrast, while 40% of buyers researched goods at brand stores or counters, this marked a drop of 13 percentage points on 2011. Scores for TV ads fell by eight percentage points to 39%, with magazine advertising down by 12 percentage points to 34%.
"Consumers here are becoming more technology savvy with an increased take up of smartphones, iPad-type technology, and personal computers," said Egidio Zarrella, clients and innovation partner at KPMG China.
Data sourced from KPMG; additional content by Warc staff