Germany’s Mytheresa is reportedly hoping to court shoppers in China’s busy luxury space.
CEO Michael Kliger said the upscale eCommerce company will begin employing personal shoppers and staging in-person events as it tries to carve a space in a marketplace ruled by companies like Alibaba, Reuters reported Monday (April 17).
“The company [globally] has grown 20%-plus in recent years, and our expectation from China in coming years is double that,” Kliger said, per the report. “Because we are so small here, this doesn’t even mean we are going against the big guys, it’s still a very special customer we focus on.”
Kliger added that Mytheresa could appeal to “mature” luxury shoppers in China, telling Reuters that Mytheresa’s top 3% of customers make up 35% of total sales.
“The luxury customer that just starts a love affair with luxury that is looking for her or his first piece, it’s probably not the target that we have in mind,” he said in the report.
Mytheresa isn’t alone among companies hoping to tap into the Chinese luxury market, the third-largest in the world.
Last week, LVMH said consumer desire for luxury goods as China re-emerges from its long COVID lockdown had helped drive a 17% increase in sales.
Speaking during an earnings call, Chief Financial Officer Jean-Jacques Guiony told analysts the company — whose brands include Louis Vuitton — is “extremely optimistic” about its prospects in China for 2023, saying that its first-quarter results “bode well for the rest of the year.”
Earlier this year, rival luxury brand Hermès reported strong consumer demand for its products in China during the closing quarter of 2022, despite pandemic restrictions.
China’s beauty and personal care market is projected to reach $98 billion this year.
“[We] continued to see strong desirability in China,” Hermès Executive Chairman Axel Dumas said in February. “We saw things going very strongly in China with double-digit growth … including in the fourth quarter.”
Meanwhile, the luxury sector remains strong, even as consumers scale back their spending on bigger purchases like electronics and other appliances.
PYMNTS’ research has found that around two-thirds of consumers have no plans to make a purchase falling under the expensive clothing or accessories, expensive gifts or other expensive item spend categories this year. However, a sizable one-third of consumers do, and these customers likely make up the luxury retail sector’s prime target market.
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