Cartire Wants To Reduce Sales In Mainland China

For luxury brands, the most profitable year for Chinese market is over. "Price reduction" may be the first step in their attitude adjustment.

In May 1st this year, jewellery brand Cartire (Cartier) was going to cut prices in the mainland. Cartire customer service told reporters that the price cut covers most of Cartire's jewelry and watches products, the official website and stores will be synchronized price cuts. Take the 18 KK diamond single ring of Cartire LOVE series as an example. The price of the official website before the discount is 17500 yuan. After the price reduction, the price is 15800 yuan, the decrease is about 10%, and the fall of different products will be different. Rhodes PR, a public relations firm in Cartire, has also confirmed the price reduction.

For brands, lowering prices is not a trivial matter. In particular, the price reduction involves a variety of products. Before they are depreciate, they need to calculate the price of each product in detail. Cartire had already made a round of price cuts in Hongkong, with the price of watches being cut by 5% and jewelry prices also lowered.

Generally speaking, the pricing of luxury goods is influenced by many factors such as tax rate, import tariff, arrival cost and so on, and there will be a big price difference in different regions. Prices in the mainland are generally much higher than those in Hongkong and overseas. The recent fluctuation of exchange rate leads to the increase of the price difference of the products, which may be the main reason for Cartire's price reduction. In a statement issued by Cartire, they also suggested that the price reduction was aimed at "providing a consistent price system for consumers and partners around the world", in other words, narrowing the price gap at home and abroad.

The first thing to change is Chanel (Chanel). They have adjusted global pricing since April 8th. The three largest handbags series 2.55, 11.12 and LeBoy have raised 20% in European market price and 20% in Chinese market price fixing. After Chanel took the lead in reducing prices, Patek Philippe, which has many wrist watch brands, also adjusted the price of its products, and many brands responded to it. PatekPhilippe

Cartire is the largest clocks and jewellery brand in Richemont Group. Sales volume Once accounted for half of the total sales of the group. operating profit 2/3, Cartire's price cut means that in the face of the wave of price cuts, the group has begun to act.

In fact, these days, Cartire's life in the Asia Pacific region is far from good. Too many stores have led to the popularity of the brand and a little deviation from high-end luxury goods. In addition, they have to face new changes in the domestic market at any time: domestic consumers are constantly moving overseas.

China's luxury market has become more complex since 2012. The government's restrictions on the purchase of luxury goods and the increase of anti-corruption efforts have brought great pressure to the luxury goods industry, especially in recent years, and most luxury brands have made unsightly answers in the mainland of China.

The bigger change comes from people's consumption habits. Yes, mainland consumers are becoming more and more senior. In 2014, 55% of luxury consumers chose to buy luxury goods overseas. They knew that the price difference between domestic and foreign products was no longer a simple pursuit of famous brands and big LOGO. Instead of buying expensive products at domestic stores, they prefer to take strong renminbi to punch cards in Paris and New York.