As the Chinese economy continues to disprove it’s critics and grow at a steady pace with a greater focus towards domestic consumption, the Chinese consumer is doing exactly as expected and spending a lot more than before. A most notable consumer segment to have emerged is the luxury goods consumers. I just saw a report in the WSJ that China has just opened the ‘world’s largest duty free mall’ in Hainan, a clever strategy to tap into the luxury consumer wallet.
Although the author mentions in passing that luxury demand has dipped (attributing it to the government’s crackdown on corruption) the numbers tell a different story. As I noted recently, in an article on ‘Asia Rising’, Chinese consumers contribute as much as 10% of the world’s luxury sales! Asian consumers, in general, are lapping up nearly half of the US$ 80 million luxury goods market.
But as the WSJ article questioned, “if you build it, will they come?”. A pertinent question when thinking about the latest addition to Colombo’s luxury offering (well, relatively), the Arcade Independence Square. Will people come, to not just walk over the fish tank?