BERNSTEIN20Mav2026SOCIETEGENERALECROUPGlobalLuxury GoodsGlobalLuxury Goods: 10 Key Takeaways from Our Trip to ChinaLucaSolcaWehavebeenontheroadwithagroupofinvestorsinHongKong andShanghaitomeet withpublicand prvate companies, retailers, industryinsiders to getthe temperatureoftheluxury5827231Tuica.Solca@bernsteinsg.comand fashionmarketinChina.(Seorlastyearstakeaways:GlobalLuxuryGoods-FromtheRoad in China).MariaMeita1420717005401.Chineseluxurydemandisstabilsingfakbaseandremainshighlymariameita@bernsteinsg.comEricChen,CFAThe highend continues to spend on luxury gods avel an d hospitalty bu this is not232695translatingintoabroad-based rebound,asmidle-incomeconsumers remain cautiouseric.chen@bernsteinsg.commore selective and less willing to stretch for big-ticket, logo-heavy purchasesYi-PengKhoo,CFAhersand the returnofyi-peng.khoo@bernsteinsg.comresidentil propertymarket andrising transaction volumesare feedingSpecialistSalescs is underoining better discretionary spending and luxury demanarly but unevenimprovement, helpedbysignsofalxturner@bernsteinsg.comTransaction volumes are up in Tier 1 cities and thereissome priceulorice anpreciation is concentrated in the very top, prime locations,leaving many mainstream areas andmallprojectsillunder pressuredstorescontinuesto weigh onthemarket,keepingpressureonagenda,with brandsgunderperforming dors,shrinking footprints and concentratingfhighly productive, laship-ypelocations in the best ter1malls{SseeGlobalLuxury Goods:RetalNetworkdynamicsinChinal,intensifed:Hemmes, Louis Wuiton,Chanel, VanCleef&Arpels ad p Swis ath maisonsremaln vey ston, while many ier 2andir bandsace and productiy. In practice, this means the strongesthousesarestllabletoexpand space, hold price and investin experiences, while weakerinamesincreasingly redurcing theiretallnetworkand likely consumermindshare too.*China forChina"isnowcentraltostrategy. with globalbrands ocalisingassortments,storyteingand clienteling rather than simply importing global playboks.Examplesrangefrom tailringproduct andpricingto Mainland consumers, tobuildingad ifestVe ecosystems(cates, museums,WeChat-centricCRM,localKOL partnerships an club-likespaces)designed specificlly around Chinese cientexpectationsinbeauty,RTWandjewellery,especiallv at entrv price points. Sonamont and Grotoin eather aoods Laoouinwellry, and domestic beauty brands such as Mao Geping and othersare winina sharebycombingcredible productvwithstrongcauturalsoyfeling, digitalengagement andsharper value-for-money than many international aspirational brands(see Richemont andthe Chinesejewellery market).Continuedonthenextpage.Seethe DisclosureAppendixofthisreportforrequired disclosures, analyst certifications and other importantinformation.Alternatively,visitour GilobalResearcoh Disclosure WebsteFirstPublished:20May202605.00UTCCompletionDate:20Mav202604:02UT0
luvaSolca441582723126 luca.solca@bernsteinsg.com20May2026icontinuedfromthefirstpage 8.In the context of subdued midle-dlass demand, global brands are leaning heavlyoncreative activations and experientialformatstodefend pricing powerand shareof...
