Gucci the latest luxury brand to diversify into food and beverages in Asia-wide trend
Luxury brands have begun to expand beyond their core but saturated fashion businesses into the food and beverage sector in Asia.
Iconic fashion brand Gucci, for example, opened 1921 Gucci in Shanghai iAPM, which is owned by Sun Hung Kai Properties in the Puxi district of the city.
“This is the luxury brand’s first fine dining restaurant in the world,” Maureen Fung Sau-yim, director of Sun Hung Kai Development (China), a unit of Sun Hung Kai Properties.
The 360 square metres shop has received a good response since opening about three months ago, said Fung.
The luxury restaurant is aimed to enhancing customers’ intrinsic aspirations which plays a role in luxury consumer behaviour. It would become part of a trend as mainland Chinese have been changing their shopping habits, she added.
Adding an F&B component in stores enables luxury retailers to provide their consumers with a more complete experience in which they can shop, relax and socialise, said international property consultant CBRE.
It cited another example in Cafe Dior by Pierre Hermé on the top floor of Christian Dior’s flagship store in Seoul. It helps transition the brand from being totally fashion-oriented to more lifestyle-driven.
In its report known as The Future of Luxury Retail in Asia Pacific, CBRE said most major luxury retailers are now well established in the Asia Pacific region with mainland China and Hong Kong being two of the most penetrated markets at 89 per cent and 81 per cent, respectively.
“However, the high growth period for luxury retailers in the region is gradually coming to an end,” said Henry Chin, Head of Research, CBRE Asia Pacific.
Apart from food and beverage, CBRE has identified other emerging trends such as childrens’ wear and the growth of the affordable sector, anticipating that they will partially offset some of the negative effects caused by China’s slowdown and compensate for the loss of demand.
As of 2014, Asia Pacific was home to 807 million people aged below 14, representing more than 20 per cent of the total population, offering an enormous opportunity for growth in this segment.