Luxury Italian brand Versace expects Asia to overtake their US market, reigning second place in terms of revenue and investment, after Europe. Hoping that the financial crisis will not dampen consumer sentiments in Asia, Versace CEO Giancarlo Di Risio told the Wall Street Journal in Beijing on Wednesday, “Our plan for Asia [was] set two years ago,… We are sticking with that plan….By 2009 [Asia] will be our second largest market after Europe.”
The company plans to invest 45 million euros (US$56.5 million) to strengthen its presence in Asia and is opening 11 new stores this year — nine in Hong Kong, Macau, Taiwan and China, and two in Europe, including a home furnishings store in Milan.
Richmond, the world’s largest jewelry maker on the other hand which manages brands such as Alfred Dunhill, Cartier SA and Montblanc (pens) announced that China displaced the U.S. as the main market for Piaget watches and Cartier necklaces this summer.
“Emerging-market growth is key for luxury,” Guillaume Duchesne, a strategist at Fortis Private Banking in Geneva told Bloomberg. “It’s important to see that the growth trend there is continuing.” Johann Rupert, Richemont’s billionaire chairman, added that the company was seeking growth from China, Russia and the Middle East. Chinese sales rose 50 percent in May.
Japan currently reigns as the largest luxury market within Asia, however China, India and the Middle East with their large brand conscious consumer base are fast catching up on the fashion scene. Mr. Di Risio expects China to eventually be No. 1 in Asia.
A recent Reuters report said that even before the crisis gripped the world economy, newly rich consumers in economic giant China, luxury-loving Japan and booming India lapped up luxury goods at a rate unmatched in Europe and the United States.
Hedrick-Wong MasterCard’s Asia-Pacific economic adviser added to Reuters that even as recession bites, Asians would continue to spend on luxury goods, but probably with less zeal, even though the region is not as badly affected by the financial crisis as other parts of the world.
“There are so many more aspiring consumers here than in Europe and the United States,” he added.
Versace is owned by design head and vice president Donatella Versace, her brother Santo and her daughter Allegra. It competes with Richemont
