It is estimated that millennials account for two-thirds of all luxury spending in China and, in a development that will concern global brands, there are signs that these younger consumers are increasingly open to homegrown alternatives.

According to Annie Hou, the Beijing-based VP of strategy at marketing agency Ogilvy, millennials express themselves and shape their personal image through luxury goods and they no longer view domestic brands as inferior, the Financial Times reported.

Part of the reason, according to Ogilvy’s 2019 luxury report, is because Chinese millennials have grown up during a period of unprecedented growth and this has generated pride in the nation and its economic achievements.

“[The] post-90s [generation] grew up in an age when China had double-digit growth and rising global influence and reputation,” the report said. “They are much more proud to be Chinese and for many of them, Chinese [luxury] brands are as good as or even better than foreign brands in some categories.”

This growing consumer trend has been observed before in a number of surveys, but it appears it has not spread to the lucrative watchmaking market, which was valued at $11.4bn last year, an increase of 10% from 2017.

It is not that China does not have quality watch brands – state-owned factories have been making them since the 1950s – but rather international brands appear to be keeping their lead because they simply are better at marketing.

“You do have quite a few Chinese brands and they do have quality products, but unfortunately I don’t see any of them [adopting international brands’ approach to] marketing,” said Carson Chan, a watch collector and expert. “It seems to me all the marketing that they’re doing is saying: ‘Look, I can do it for half the price’.”

Swiss watchmaker Omega, for example, last year released a limited edition Speedmaster, which featured the Ultraman Japanese cartoon character that is also popular in China.

In addition, successful global brands put in considerable effort to reach Chinese consumers through social platforms, such as Tencent’s WeChat messaging service. And, at least for now, heritage is another powerful draw that Western brands can promote.

Sourced from Financial Times; additional content by WARC staff