LVMH bullish on potential of Chinese luxury market
CGTN's Global Business
China delivered more than half the global growth in luxury spending between 2012 and 2018 and is expected to deliver 65 percent of the world's additional spending heading into 2025, according to the 2019 McKinsey China Luxury Report.
French luxury conglomerate, LVMH, has been in the Chinese market for 176 years. The luxury giant is betting on the Chinese luxury market and plans to win out with a digital layout and a unique brand story, according to Stéphane Baschiera, president and CEO of Maison Moët & Chandon.
Baschiera said LVMH has achieved the right balance between domestic consumers and people who travel abroad. But the world is changing quickly, especially in China. Chinese shoppers nowadays are spending more at home rather than shopping abroad. Baschiera believes going digital is the key to doing business, and the China International Import Expo (CIIE) also provides a great opportunity for the group.
Chinese luxury consumers are now "picky," he said. "I think the Chinese consumer is more and more demanding. They want to know everything about a product. They want to understand how it is made, how it is supplied, and everything concerning traceability.
"You cannot only sell a product to Chinese consumers; you have to give them a very strong reason why they have to buy it," he added.
It has been 55 years since the establishment of diplomatic ties between China and France. Baschiera said with French companies attending the CIIE 2019, the two countries will further deepen cooperation between them.
During the expo, the company's share price surged to 404 euros, making it one of the most valuable companies in Europe, with its market capitalization topping 203 billion euros (about 224 billion U.S. dollars) for the first time.