Is China’s luxury market really ‘Covid-proof’? Chinese demand for Dior gave LVMH a US$10 billion boost, thanks largely to millennial and Gen Z online shoppers
- Luxury brands thrive in China, where pandemic lockdowns swiftly ended unlike Europe and the US, and the country may claim the biggest market share by 2025
- LVMH’s Asian revenue catapulted founder Bernard Arnault to the fourth-richest person in the Bloomberg Billionaires Index, just behind Bill Gates
If evidence were needed of how far China has moved beyond the pandemic, perhaps the strongest was the scene at Christian Dior’s autumn fashion show earlier this week, hosted at an art museum in Shanghai.
The 750 guests lined the catwalk to watch models strutting to disco tunes, one in a sequin jumpsuit, another in a bright pink dress, as creative director Maria Grazia Chiuri’s collection was live-streamed around the world. Those inside weren’t even wearing masks.
That suggests more good news to come from fashion houses, even if growth varies widely across regions, brands and product categories. After recovering from a steep downturn in 2020, luxury is benefiting in particular from the appetite among millennial and Gen Z Asian shoppers for high-end shoes and handbags.
“It does seem this sector is Covid-proof,” said Andrew Shipilov, professor of strategy at French business school Insead. Luxury is “still the sector that people spend money on when they cannot spend on travel – it’s one of the winners” of the pandemic era.
The luxury goods market in China grew 48 per cent last year as travel disruptions boosted domestic spending, according to a December report from Bain & Co. The consultancy expects this growth will forge ahead, putting the country on track to claim the biggest share of the market by 2025.