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17 March 2008
Hong Kong
Hong Kong consumers are no doubt among the quick adopters of fashion trends and are the world’s most brand conscious, evidenced not only by the increasing number of luxury brand stores opened in the city but also as captured by the latest Nielsen Global Luxury Brands Study.
Being considered by many luxury groups as a major market for their products, Hong Kong leads the Asia Pacific region with four in 10 consumers claiming to buy products of luxury brands, significantly exceeding the regional average of 15 percent. About half of the consumers also do not think the quality of imitations is comparable to the genuine ones.
As the global study reveals, Hong Kong tops the world with most people claiming to buy Gucci (31%), Louis Vuitton (LV, 27%), Burberry (26%).). Hong Kong also tops the Asia Pacific region with most people currently buying Prada (13%), Chloe, Marc Jacob and Bottega Veneta (each at 3%).
The preference on brands varies when money was no object to the brand conscious Hong Kong consumers – 40 percent expressed their desire to buy a LV product in the future if money was no object. Following LV as the most coveted brand among Hong Kong consumers are Gucci (30%), Burberry (26%) and Prada (24%).
“LV has consistently come up with interesting designs and new product ranges that meet the diverse appetites of not only the Hong Kong consumers but many Asians as well,” said Yvonne Lum, Director, Retailing Research, The Nielsen Company Hong Kong. “LV has also been holding their brand values tight, which is critical for any brand to maintain customer loyalty and to appeal to potential followers.”
It’s worth noting that the level of desire among Hong Kong consumers to buy a Prada (24%), Giorgio Armani (19%) and Chanel (19%) product if money was no object has been increased from 2005 when the similar study was conducted. According to Nieslen’s on-going tracking of Hong Kong consumers’ retailing spending, an average of $6,000 per capita was spent on luxury products by Hong Kong people in the past quarter.
On a regional level, LV is also the most coveted brand in Asia Pacific with 29 percent of Asian consumers desiring for a LV product if money was no object, followed by Chanel (28%) and Gucci (27%). The level of desire among Asian consumers to buy Chanel and Christian Dior has increased by six and four percentage points respectively compared to two years ago.
“Hong Kong is considered by many international brands as a major market in Asia. Based on our prudent estimate, at least 50 designer brands have opened their own shops and branches in town,” Ms Lum observed. “With the improving personal financial status of Hong Kong people and an increasing number of tourists who love to shop for luxury brands in Hong Kong due to the absence of GST, there is huge room for growth in the luxury sector.”
To maintain awareness, close to HK$500MM was spent on advertising in 2007 by some 50 luxury brands monitored by Nielsen’s Advertising Information Service, representing a 24-percent increase from 2006. The top spenders were Christian Dior, Chanel, and Louis Vuitton while the ones that registered the biggest increase in advertising spending were Roger Vivier (717%), Donna Karan (654%) and Max Mara (446%)
What’s on the Horizon for Designer Brands?
The luxury brand appeal has certainly spread across sectors. According to the Nielsen survey, nearly 50 percent of consumers in Asia Pacific said they would buy a mobile phone that was co-branded with a luxury brand – a sector where fashion giant like Prada has already taken advantage of. 43 percent said they would buy a co-branded designer laptop computer, 27 percent for a “designer” flat screen TV and a fifth would go for a designer branded MP3.
In Hong Kong, consumers’ preference for a designer branded gadget is – Mobile Phone (47%), MP3 (23%), Laptop computer (20%) and Flat Screen TV (17%).
“There seems to be huge market potential for luxury brands to evade every corner of the home and office,” said Ms Lum. “Cross-over between brands and products is certainly a way to go in pursuit of on-going innovations and it is clear that consumers from Asia along with other fast developing markets are again driving demand for these products.”
About The Nielsen Company
The Nielsen Company is a global information and media company with leading market positions in marketing information (ACNielsen), media information (Nielsen Media Research), online intelligence (Nielsen Online and BuzzMetrics), mobile measurement, trade shows and business publications (Billboard, The Hollywood Reporter, Adweek). The privately held company is active in more than 100 countries, with headquarters in Haarlem, the Netherlands, and New York, USA. For more information, please visit, www.nielsen.com
www.nielsen.com.
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