In case you missed them the first time around, here are some of Jing Daily’s top posts for the week of October 1-5:
Though China’s red-hot luxury market — which has helped the global industry weather tougher times since 2008 — has slowed from high growth-rate estimates in the range of 35 to 40 percent in 2011 to anywhere from 13 to 18 percent this year, the effect of this muted slowdown has been far from uniform for major brands. Owing to aggressive expansion efforts, increased overseas spending by tourist-shoppers, a decline in conspicuous consumption in major cities and other factors, some of the world’s largest luxury brands have seen a marked decrease in profits in 2012 while newer entrants have recorded impressive sales growth.
Amid a drop in property prices, lower economic growth rates and a crackdown on art importers in mainland China, the upcoming Sotheby’s autumn auction series in Hong Kong will test the strength of Chinese demand for art, wine, watches and jewelry as both alternative investments and luxury goods in their own right. Along with blue-chip Chinese contemporary art, the series includes an array of auctions, from rare wines to modern and traditional Chinese art, antiques and more. In the contemporary Asian art auction alone, Sotheby’s expects to achieve over HK$130 million (US$16 million) in sales, with other popular segments like Fine Chinese Paintings estimated at HK$170 million (US$21.8 million).
With the attention of the global art auction world firmly on the Greater China market at the moment, observers are eager to see whether economic turbulence has dampened collector enthusiasm.
Though annual per capita consumption sits at less than five cups, coffee is becoming a daily addiction rather than an occasional splurge for a growing slice of the Chinese population. With coffee consumption in China rising at an estimated 30-40 percent annually, over the global average of 2-3 percent, major coffee chains like Starbucks — which currently has over 570 stores in 48 Chinese cities — aren’t the only ones bullish about the market. This week, Andrea Illy, chairman and CEO of Italian coffee group illycaffe, said his company expects rising demand to propel China into the top five coffee-consuming countries within a few years. Though not entirely surprising, considering the size of the population, Illy told Reuters that “the rapid emergence of mega cities in China would create business opportunities for groups like illycaffe to boost coffee drinking, typically in Italian style, in the form of cappuccino or espresso.”
Mainland Chinese tourists continue to flock to nearby Hong Kong for duty-free shopping sprees — more than 28 million visit the city every year — but lower-than-expected statistics for the first three-quarters of the year indicate that these travelers are doing more of their luxury consumption elsewhere. According to a Hong Kong government statement, August retail sales rose 4.5 percent to HK$35.8 billion (US$4.6 billion), up from a 3.9 percent increase in July but lower than Bloomberg’s 5.8 percent estimate. At the higher end of the market, sales of jewelry, watches, clocks and luxury gifts dropped 3.4 percent in August from one year prior, which is even more dramatic considering these sales rose 53 percent year-on-year in August 2011.
China may be better known for baijiu than Blaufränkisch, Thailand more for pad thai than Petit Rouge, and Japan for sake over Syrah, but with wine production in these and other Asian countries increasing along with product quality, British wine industry watchers expect an import boom in the years ahead. Led by interest in the country’s supermarket sector — particularly among leading players like Marks & Spencer and Waitrose — winemakers in the vast Asia-Pacific region are gearing up to send more stock to the UK, the world’s sixth-largest wine market after being surpassed by China earlier this year. As Neil McIlwee, sales manager of Thailand’s Siam Winery told the Drinks Business this week, “I know there is going to an explosion in Asian wines very soon with the amount coming over from India, China and Japan.”