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December 10, 2010

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Go on a designer spree Luxury brands are closer to home

IT used to be routine for Shanghai resident Michelle Shen to travel to Hong Kong, a "shopping paradise" less than three hours away by air, before Christmas to buy gifts - lots of them - for herself, her family and her friends.

However, this year, the 27-year-old office worker decided to stay at home. Her last shopping excursion to Hong Kong with her husband in April was "devastatingly depressing."

"You can't imagine how many people were there in the Louis Vuitton store or the Chanel store asking for the same bag," she said. "It felt like shopping in an open market rather than in a luxury store."

She ended up not getting the Chanel bag she had planned to buy before the trip, and spending a lot of cash on piles of beauty products not on her list, most of which she has yet to open.

"I feel stupid," she said. "I wanted to buy the bag in Hong Kong because it is cheaper there. However, the money I spent on the airline tickets, accommodation and all those unnecessary cosmetics far exceeded the price difference. And, I didn't even get the bag!"

Hong Kong is no longer the first choice for local residents to buy luxury goods nowadays. According to Bain & Company, a research consultant, China's consumer luxury goods market outpaced every other luxury market in the past year, with a 23 percent increase over 2009 in terms of sales. The company surveyed nearly 1,500 luxury consumers in China and found there is a continued trend of increased domestic spending.

Shen's friend, Lily Chen, said that she used to travel to Hong Kong to buy brands that are not available in Shanghai. She added she is an ardent follower of Italian fashion brand Miu Miu, which opened its first store in Shanghai this year.

"It's much easier to buy here," said the young housewife who is married to a wealthy husband. "I can get what I want immediately without having to plan a trip or waiting for friends to bring me something from their trips. The service is better, too - the shop assistants speak Shanghai dialect as I do. I sometimes have communication problems with shop assistants in Hong Kong or other countries."

Besides Miu Miu, many luxury brands including Tom Ford, Roger Vivier, Giuseppe Zanotti and Georg Jensen launched stores in Shanghai this year.

Moreover, the opening of IFC Mall in Pudong New Area, together with the recently renovated Hong Kong Plaza and Lippo Plaza on Huaihai Road, provides Shanghai shoppers a much wider choice in terms of shopping destinations.

"It seems to have happened all of a sudden," Chen said. "Shanghai now has three Chanel, three Louis Vuitton and four Tiffany stores. It's hard to imagine this even just a year ago."

Shen agreed and added that there are more product offerings in Shanghai nowadays thanks to the opening of these stores. For example, the bag she couldn't find in Hong Kong is available in two Chanel boutiques in the city.

Some fashion houses create special limited edition products to be sold only in certain stores in China. For example, when Coach opened its flagship store on Huaihai Road earlier this year, it launched a limited edition collection of purses and accessories specially designed for the store. Dior also came up with a capsule collection in a unique blue color to commemorate its store opening in Plaza 66.

To celebrate the upcoming holiday season, Chloe launched a limited edition of 78 bags in the prosperous red color for the Chinese market. Each bag comes with its own serial number.

"The shopping environment is much better too," Shen added. "The Chanel flagship store in the Peninsula Hotel is my favorite. It is never too crowded, and is decorated in an elegant, arty way. Shopping there makes me feel really good about myself."

Many luxury brands with new stores opened in Shanghai this year, including Louis Vuitton, Dior and Swarovski, invested a huge amount of money on interior decoration to offer customers a better shopping experience.

Chen added that it's really unnecessary to go to Hong Kong if one only wants to buy a bag or two, since the price gap has narrowed over the years.

For example, a Louis Vuitton Speedy 30 bag was recently priced at 5,500 yuan (US$825.28) in Shanghai while it was available for HK$5,450 (US$702) in Hong Kong. A medium-sized Chanel classic flap bag was priced at 27,900 yuan in Shanghai and HK$29,100 in Hong Kong.

Special services offered by certain brands are another reason for customers to shop Shanghai. The Ferragamo's Creations atelier in IFC Mall, for instance, is the only of its kind in China where customers are able to order recreations of the brand's most famous historical models in limited-numbered series.

Louis Vuitton's Plaza 66 store features an atelier, a workshop where a range of special services, including made-to-order, hot-stamping and painting are provided. For example, one can have his or her initials hot-stamped (a dry printing method) on a newly purchased handbag. It is also the French luxury house's first atelier located in a store anywhere in the world.


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