LONDON — For the most affluent Chinese luxury consumers, it’s the idea of craftsmanship that most defines luxury, ahead of the concepts of high price and status. That’s according to a report by the market research company Mintel will release Wednesday.
The firm said that of the Chinese luxury consumers it interviewed, 71 percent of those with a household income of over 25,000 renminbi, or $4,064 a month, defined luxury as “craftsmanship,” a ten percent increase on those luxury consumers earning between 20,000 and 25,000 renminbi, or between $3,251 and $4,064, a month.
The lower the luxury consumers’ income, the more they associated luxury with the ideas of “status” and “extravagance,” Mintel said. 53 percent of those luxury consumers with incomes between 20,000 and 25,000 renminbi a month said status was a consideration when making luxury purchases, compared to 48 percent of those earning over 25,000 renminbi a month. And when Mintel asked if consumers saw “extravagance” as being central to a luxury good’s definition, the proportion who agreed was greatest — at 53 percent — in those consumers who had a monthly household income of between 12,000 and 18,000 renminbi, or between $1,950 and $2,926.
“This research highlights that the wealthier a consumer is, the more likely he or she is to appreciate luxury goods for their innate quality and value — and the less likely he or she is to define luxury in terms of external factors such as the status or extravagance of a luxury product,” said Matthew Crabbe, director of research for Asia Pacific at Mintel.
The firm’s research also found that Chinese luxury consumers are growing more accepting of Chinese brands, citing the finding that 43 percent of urban Chinese consumers believe that Chinese and foreign luxury clothing brands provide the same quality of product. “Though the trend is still in its infancy, Chinese brands are beginning to make inroads with Chinese luxury consumers,” said Crabbe. But conversely, when it comes to categories such as watches and cosmetics, Chinese customers still believe foreign brands are superior, with 79 percent of urban Chinese consumers believing foreign watches are superior to Chinese brands and 69 percent of consumers believing foreign cosmetics are superior to Chinese brands.