Kering bullish on Chinese domestic luxury consumption
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French luxury goods Kering sounded a positive note on its forecasts for its performance this year in China, even if the country’s consumers are not expected to resume traveling abroad for at least a year.
Group managing director Jean-Francois Palus told analysts on Thursday the company had deepened its presence in mainland China during the pandemic, notably through e-commerce on Alibaba’s Tmall platform as well as its own websites in the country.
He also cited internal tourist flows to the duty-free shopping hub of Hainan as well as other parts of the country as fuelling luxury sales growth.
The executive said he was optimistic about the health of Chinese consumption, noting a lot of new consumers beginning to buy luxury products, with “a good propensity to buy and to buy more.”
Questions & Answers
Q.What is Kering's main strategy for growth in mainland China, given the travel restrictions?
What is Kering's main strategy for growth in mainland China, given the travel restrictions?
Kering has deepened its presence through e-commerce platforms like Alibaba's Tmall and its own websites. It is also capitalising on internal tourist flows to duty-free zones such as Hainan.
Q.Who provided Kering's positive outlook on the Chinese market?
Who provided Kering's positive outlook on the Chinese market?
Jean-Francois Palus, Kering's group managing director, shared the optimistic forecasts with analysts. He highlighted the company's strategic adjustments and growth factors within the market.
Q.What specifically makes Kering optimistic about Chinese consumer behaviour?
What specifically makes Kering optimistic about Chinese consumer behaviour?
The company observes a significant number of new consumers entering the luxury market. These new buyers are noted for their strong inclination to purchase products and increase their spending.
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