Retail in Asia

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What happens when top-tier brands get too much exposure in China?

The Alfred Dunhill label operates more than 100 stores in China. According to its executives, 40 percent of the brand’s global sales come from Chinese pockets. But Alfred Dunhill has lost its pizzazz – a fate that insiders say may befall many other designers in China.

The problem seems to be that Dunhill didn’t storm the market as much as flood it. The large number of stores means savvy and sophisticated consumers in first-tier cities look elsewhere for exclusivity – the company can no longer claim to embody British luxury with the likes of Kent & Curwen and Drakes London now in China.

This "points to an issue many brands will face in China – i.e., maintaining their cachet with those [consumers] adopting new ideas, styles, brands without alienating the core consumers they grew up with," Torsten Stocker, Greater China partner at the consulting firm Monitor Group, said.

(Source: red luxury)