Segmenting the Chinese Luxury Goods Market

Compare and contrast various segments of Chinese luxury consumers and customers profiled in the case.

Based on the given case scenario, the segmentation of the Chinese luxury customers has been segmented. It has been analyzed from the given case study that Diego Della Valle who is the current chief executive of marketer related to Italian luxury products, Tod’s has discussed the growth of its market in China. He has witnessed an increasing number of Chinese customers buying luxury goods due to their intention of maintaining image-related exclusivity for maintaining popularity. In accordance with the observations of the marketers, Chinese consumers can be classified into few segments, which include the newly rich, super-elite as well as government officials.

However, despite the increasing number of Chinese customers who are taking resort to purchase luxurious Italian goods, their shopping behavior varies, which are as follows:

The extremely rich customers prefer buying luxury brands, which will be reflecting the superior taste of the buyers. For instance, the extremely rich Chinese customers prefer buying Bottega Veneta offering celebrated Italian craftsmanship and signal more discretion instead of buying handbags from Louis Vuitton, which has become quite common among the mass for its iconic monogram (Bu et al., 2017). Moreover, they take resort to buy luxury goods while vacationing or while going for business trips to the United States, Hong Kong as well as the United Kingdom. Furthermore, they are seen to be buying those luxurious goods, which are not yet established on the mainland. For instance, they were seen to early adopters of the iPhone before its establishment in the market. Concisely, the extremely rich Chinese customers prefer buying discrete luxury goods for reflecting their superior taste.

The newly rich customers, by contrast are not knowledgeable regarding the luxurious brands. Besides, they do not take resort to gain data about them. Since they appear from an economical background, they are not well oriented with the sophisticated brands and take resort to purchase less exclusive brands, which includes, Gucci, Louis Vuitton as well as Chanel (Gao and Jiang, 2017). Concisely, the newly rich are observed to be highly status conscious, which is why they prefer buying extravagant purchases.

Government officials, on the other hand have been found out to have different purchasing preference. They are referred to as the strategic officials who are unable to flaunt purchases due to less state salaries (Yang, 2016). Hence, they prefer buying accessible luxury brands, which includes Coach, which is regarded as an ideal purchase by them. Besides, they prefer travel agencies’ arranged group shopping outings where transportations, accommodations along with logistic issues are well taken care of by the agencies and the tourists are enabled to focus only on shopping.

Briefly, it can be said that the shopping preferences of the three Chinese segments, which include newly rich, super-elite, as well as government officials, vary. The extremely rich Chinese customers prefer buying discrete luxury goods for reflecting their superior taste whereas the newly rich prefer buying extravagant purchases. On the other hand, government officials prefer buying accessible luxury brands.


Bu, L., Durand-Servoingt, B. and Kim, A., 2017. Chinese luxury consumers: The 1 trillion renminbi opportunity. China Luxury Report, Marketing and sales arctic.

Gao, S. and Jiang, C., 2017, December. Customer Segmentation of Third Party Review Website Based on Cluster Analysis. In 2017 2nd International Seminar on Education Innovation and Economic Management (SEIEM 2017). Atlantis Press.

Yang, W., 2016. Chinese outbound tourists’ luxury consumption. In Chinese Outbound Tourism 2.0 (pp. 283-296). Apple Academic Press.

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