State media takes a view on the Chinese love for luxury goods. Back home in Singapore I see it first hand. They have taken over the Japanese and Indonesian big spenders in the island state, and very often pay in cash. Getting rich quick has certainly changed the complexion of Chinese wants, desires and behavior.
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Why Chinese people love luxury goods?
By Li Qian
People’s Daily translation from the Chinese version: 为啥都爱买“LV”
Source: People’s Daily, published July 3, 2012
Edited and translated by People’s Daily Online
Nowadays, the Chinese people’s huge demand for luxury goods is astonishing. In front of the Louis Vuitton shop on the Champs Elysees Avenue in Paris, a number of Chinese tourists are spending hours of valuable tourist time queuing for the expensive bags. Entering the shop, they bought several valuable bags without asking about the prices. The Beijing International Top Lifestyle Brand (Luxury Goods) Exposition just ended at the World Trade Center of Beijing, reaching 670 million yuan of intended turnover, and 92 percent of the exhibitors have booked a booth for next year. Industry insiders generally agree that China will be the world’s fastest growing market for luxury goods and it is expected to share more than 20 percent of the global luxury market by 2015.
Luxury goods refer to those top branded consumer products which are beyond the living needs of ordinary people. Therefore, the foreign luxury lovers and collectors tend to be the old and rich people. The luxury goods mostly are products with cultural connotations and owning the luxury goods means to have a culture. However, there mainly are three luxury consumer groups in China: the rich flaunting fortune and manifesting identity, the young people gaining a sense of satisfaction and the bribers for mutual collusion and commercially “hidden rules.”
With the rapid development of national economy and the enhancement of thepurchasing power, the luxury consumption Chinese people also got a certain development. The consumer perception of the people to the luxury goods needs to be guided and showing off the wealth to prove their self-esteem shows a lack of intrinsic value. If the people of a state become materialistic and especially worship the luxury goods, it will mislead and distort people’s value of the society, increase the psychological imbalance of low-income groups and affect the social harmony and stability.
The consumer goods channels need to be improved. China has imposed high taxes on the luxury and high-end consumer goods, which is the international practice to indirectly regulate the income distribution, reduce the income gap and reasonably guide the consumption. However, it pushed the purchasing power of Chinese people to the tax-free and low-priced overseas market. It will be conducive to expanding consumption and providing more jobs if China can attract its people and foreign tourists to buy luxury goods in China by certain channels and methods.
To the luxury consumption, China needs to increase efforts to fight against corruption and minimize the luxury consumption of using public funds.
With the progress of social civilization, more and more people have abandoned the practice of proving their wealth and status through external packaging and the way ofconsumption is marching toward rationality, comfort, fashion, decency and practicality. It is sure that the sales clerks of the Galeries Lafayette Haussmann in Paris and the Mitsukoshi in Tokyo’s Ginza district will welcome Chinese tourists with more gratitude and respect.