Welcome to the March edition of Retex China’s monthly newsletter. Dive into the vibrant world of China with the latest economic trends and fashion updates straight from our team in Shanghai.
In this issue:
- Economics Highlights: We’ll explore the latest developments in foreign investment in China, along with the surge in consumption during the recent spring festivities.
- Latest Market Trends: We’ll focus on the growing significance of RED 小红书, the renowned Chinese platform, for luxury brands.
- Fashion, Luxury & Design: Lastly, we’ll take a look at emerging trends in the fashion industry and the latest collaborations reshaping the international landscape.
Without further ado, let’s embark on our journey through the economic dynamics and luxury trends of 2024!
Economics Highlights
Foreign Investment Records: Multinational Giants Bet on China’s Future
Foreign direct investment in China reached a record high in 2023, with a significant increase in newly established foreign enterprises. The high-tech industries attracted a substantial portion of these capital inflows. Multinational companies such as PepsiCo, KFC, Standard Chartered, and McDonald’s have increased their investments in the Chinese market, demonstrating confidence in the country’s business environment. China is taking measures to further promote foreign investment, including a roundtable system that has already resolved numerous business issues.
Consumption Boom during the Spring Festival: Starting the Year on the Right Foot
China celebrated the Lantern Festival with an extraordinary surge in tourism: over 60% of visitors to the Shanghai Lantern Show came from other cities. The Ministry of Culture and Tourism reported a 34.3% increase in domestic trips, with domestic tourism spending reaching 632.69 billion yuan, up 47.3%. Meanwhile, the national box office surpassed 8 billion yuan during the holiday, and online sales reached at least 800 billion yuan, an 8.9% increase from the previous year. Positive signs also emerged for WeChat Mini-Programs, with a significant rise in orders for food, beverages, wine, and travel compared to the previous year.
Latest Market Trends
The Significance of RED for Luxury Brands in 2024
Exploring 2024: Transformative Trends and Commercial Insights in the Chinese Luxury Market
In 2024, the rapidly evolving luxury industry in the Chinese market faces new challenges and opportunities with a fresh perspective for business growth. Highlights from 2023, such as LV Creative Director Pharrell Williams joining RED and the emergence of the “slow live-streaming” trend, underscore the platform’s importance for active luxury brands in China. The commercialization of RED and the joint release of the 2024 Luxury Trends White Paper and the Crowd Inspiration Atlas with VOGUE Business provide insights into evolving trends in Chinese fashion and luxury consumption. Consumers are increasingly focused on life’s essence and seek rationality in luxury purchases, reflecting a shift towards functional and versatile fashion styles.
Redefining Fashion Narratives and Consumer Dynamics in the Era of RED
The report identifies key trends such as gender-neutral fashion, sports comfort, new retro aesthetics, and relaxed styling. The active presence of User-Generated Content (UGC) on RED is reshaping the fashion communication landscape. Additionally, the report analyzes various types of luxury consumers, including connoisseurs, quality-oriented new middle class, and new elites from small towns. Luxury brands are leveraging RED’s content ecosystem for effective communication, embracing innovative marketing strategies like “global localization” narratives and “anti-consensus” sector collaborations.
RED, the Pivotal Hub for Luxury Brands in China
RED reaffirms its position as the primary platform for luxury brands, offering exposure and engagement through significant events like Givenchy and GUCCI fashion shows. Beyond event promotion, RED has become an ideal space for brand value construction, attracting professional industry commentators and fostering quality discussions. Luxury brands, increasingly focused on tangible results, find RED as an ally due to its conversion capabilities and innovative mini-program introductions. In a complex Chinese market, RED emerges as a crucial platform for business expansion and increased influence.
Fashion, Luxury & Design
VICTORIA’S SECRET. During the London Fashion Week, SUSAN FANG previewed part of her collection in collaboration with Victoria’s Secret, inspired by the theme “love, freedom, and dreamy desires,” including intimates and loungewear. The full collection will be officially launched in April. This collaboration marks Victoria’s Secret’s second partnership with a Chinese designer, following RUI-built’s collection last July.
PARIS FASHION WEEK. The Autumn/Winter 2024 Paris Fashion Week is about to begin, with eight Chinese brands included in the official lineup for this season. Standout names among the selected brands include Uma Wang, Dawei, Reverie By Caroline Hu, RUIbuilt, Chen Peng, Didu, Ruohan, and Shiatzy Chen, highlighting the growing presence and influence of Chinese fashion at the prestigious Parisian event.
VALENTINO. Valentino announces a collaboration with POPMART to celebrate the Year of the Dragon, presenting 12 limited-edition red envelope covers and a phone wallpaper named “MOLLY Prosperous Dragon.” A fusion of fashion and tradition to celebrate the Chinese New Year in grand style.
LVMH. The LVMH Prize for Designers has officially announced the semifinalists for 2024, with three talented Chinese designers standing out: Chiahung Su, Ponder.er, and Ya Yi.
KERING. The “Fashion Sustainability – International Perspectives on Sustainable Development in the Fashion Industry and Chinese Local Practices” course has recently been launched, jointly developed by Kering, Cloud Group, Tsinghua University, and the French Institute of Fashion. The course, open for free to current university students worldwide and sustainable fashion enthusiasts, covers key topics such as the relationship between fashion and social environment, circular economy, fashion traceability, and sustainable fabrics, providing an in-depth overview of sustainable practices in the fashion industry.
