Pedestrians walk past advertisements for Remy Martin cognac of Remy Cointreau at a shopping mall in Shanghai, China on March 4, 2013. Weng lei ? Imaginechina/AP
China?s rich make up almost a third of the world?s luxury shoppers according to Reuters. It comes as no surprise that the largest fashion houses released a collective sigh when their domestic sales in China saw a recent uptick. Tiffany & Co. reported its first sales increase in eight quarters as a result of strong sales in countries like China and Japan. Consumer spending in the country brought Alibaba a 39% increase in sales. Burberry and Kering also happily reported positive sales in the Asian markets.
Retailers can point to a few reasons for the positive change: Chinese citizens are traveling abroad less, price differences have narrowed between China and Europe on luxury goods and, lastly, the depreciation of Chinese currency lowers its purchase power abroad. As Chinese luxury shoppers find goods in their home country, the ?new normal? is being felt from Rodeo to Champs-Élysées. One luxury retailer in Beverly Hills who was interviewed for this article recounts how a couple of years ago Chinese tourists would purchase two sizable engagement rings at once, ?just because.? Now, those types of purchases by wealthy Chinese in the United States are numbered as this demographic opts for domestic purchases. Nevertheless, this doesn?t stop retailers in the states from trying to lure in Chinese buyers with perks lik...