The Luxury Industry in China : a Booming Market

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The luxury industry in China : a booming market Introduction Over the past 30 years, China's level of wealth, and the number of wealthy people has grown faster than anyone could have predicted. And as the wealthy classes are expanding, China's luxury market has also boomed. Chinese consumers habits have changed, and if the rich people used to be criticized for flaunting their wealth, this new generations uses the expensive brands as a way to show their personal success and social status. But not only the wealthiest persons are concerned by the phenomenon : the concept of face consumption represents the Chinese consumers' strong appetite for luxury product, despite their relatively low income. They indeed dedicate an important budget to the luxury items, even if some of them have to save money for months. Chinese consumers who buy luxury do so to show off and define their identity. This concept of face, or pride and dignity, is a key reason they invest in such expensive brands. In a fast-growing economy, these luxury products are the easiest way to demonstrate their wealth and power. Furthermore, the luxury itself has created a high-end market. It is beneficial to the highend development of the Chinese industry, and can also create employment and tax revenue, since more and more luxury brands are starting implanting themselves in every big city. In 2015, China will account for about 20% (or 180 billion RMB) of the global luxury sales. The demand of luxury goods is exploding, in spite of the heavy taxes on importing them. The economic growth remains strong in the nation : even during the global recession in 2009, sales of luxury products rose by 16% down from the 20% growth of previous years, but still far better than the performance of the other major luxury markets. And because China remains stable, it is one of the most attractive destinations for foreign

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