Topic > China Luxury Market - 900

In 2005, Ernest & Young released a report on the China luxury market stating that China has become the world's third largest consumer of high-end fashion, accessories and other luxury goods and represents approximately 12% of global sales (Young, 2005). Along with other similar reports on the strong growth of the Chinese economy and the luxury market in particular, many of the luxury brands originating from Western countries such as France, Italy and the United Kingdom have already entered the market, those who have not yet done so have plans in this regard and are starting to do so. Although many reports have highlighted the importance of Chinese luxury consumption, large disparities exist; some say China accounts for 12% of global sales, others say 8% (Young, 2005; Movius, 2005). According to Zhu and Wang (2005), although inconsistencies exist in the data, most reports come to similar conclusions that China is the third largest luxury market and is expected to grow and become the first in 2015 (Sachs , 2005) with the amount of consumers increasing from 175 million to 250 million in 2015 (Young, 2005). The future of the Chinese luxury market is undoubtedly promising, however it is important to realize that the current market is actually smaller than imagined and the size still remains limited, only 3% of global sales occurred on the domestic market in China, while more than half of total sales occurred abroad (Movius, 2005). Luxury brands who have focused their attention on emerging markets due to the continuous growth of the luxury industry should be aware of the fact and therefore develop a reactive marketing strategy instead of transferring the same traditional strategy from the Western world (ChinaDaily, 2011 ). Since the market is far from mature (Anestis et ...... middle of paper ......and hand), this could preserve the brand identity and maintain similar service quality; however, they ignored an important customer need, which is customization (Okonkwo, 2007). Although several studies have examined how cultures influence consumer behavior in China, none have adequately compared it with other countries. Invalid source specified. Furthermore, most looked at the issue from the customer's perspective. perspective by analyzing the motivation behind huge consumption (Wong & Ahuvia, 1998)Invalid source specified (Gao, Norton, Zhang, & To, 2009). Only a few have evaluated established marketing strategies with cultural analysis, those that have only focused on segmentation and positioning. Invalid source specified.. In this essay, the perspective of luxury brands will be used to analyze how it is used the influence of culture on the existing marketing mix.