China slips into something a bit more comfortable
Print Edition
HIGH-END lingerie sales are outpacing China’s generally downbeat luxury market, and heating up competition between international brands and local rivals looking to go upmarket.
US brand Victoria’s Secret will open its first store, and companies including Italy’s ultra-luxury La Perla and Germany’s Triumph are adding stores and moving beyond China’s mega-cities to tap a lingerie market that has more than doubled in five years to US$18 billion, according to Mintel Group.
Chinese consumer tastes are maturing, women are more confident about buying for themselves.
“Luxury is... not about buying to show off, it’s about buying items that make you feel good,” says Chiara Scaglia, La Perla’s Asia chief.
China’s women’s underwear market is expected to have a retail value of US$25 billion by next year — double that of the United States — and will grow to US$33 billion by 2020, according to Euromonitor.
Chinese firms such as Beijing Aimer, Maniform and Ordifen are also chasing that money, targeting higher-end customers and raising their quality.
“That means foreign brands will have to out-compete local brands not just on quality, but also innovation,” said Matthew Crabbe, director at Mintel.
For now, the market is highly fragmented, with none of the leading firms having more than around a 3 percent share. International brands see China as a priority to help bolster overall sales given a fairly bleak global outlook.
La Perla, which sells bras priced around 2,000 yuan (US$300), has eight stores in China and plans additional outlets in Chengdu and Chongqing within the year. It also aims to open a men’s store in Beijing.
“The perception of the lingerie sector has changed,” Scaglia told Reuters. “At the beginning many people we spoke to were confused as to why anybody should spend over US$1,000 on panties for something nobody sees.”
Victoria’s Secret will open a 1,860 square meter flagship store in Shanghai this year.
“I think it will announce our arrival in China in a very significant way, and should be the beginning of an enormous business for us,” said Martin Waters, president of L Brands International.
Cosmo Lady, a Chinese firm that has focused on the mass market, selling bras from 50 yuan (US$7.50), last year bought Ordifen to increase its presence in the luxury market.
“We would like to gradually step into the high-end market,” said Peter Lam, Cosmo Lady’s assistant CFO.
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