Chinese New Year inspires Mulberry
The British company seeks promotion in China in this important holiday while it found a new CEO after a year of executive searching.
Once finished New Year celebrations most sources indicate that it has been very conducive for sales of luxury goods, with an increase compared to the same period of last year. As Luxonomist published, according to the CEO of Salvatore Ferragamo the company expects good results in the year 2015, driven by a good campaign in February.Mulberry is another company that steps up its promotional efforts towards this festival, with original designs of their bags.
According to Chinese state media, more than 5 million travelers went abroad and increased national retail sales by 11 per cent over 2014.This good behavior alleviates some way the downturn that occurred in the luxury industry in China due to the anti-corruption campaign limiting gifts to officials, and we have already discussed from these pages. Chinese consumers have spent at home during the holiday period an amount around 100 billion euros.
Sales have been uneven good depending on what product is analyzed and although some declines were observed in luxurious banquets and spirits (consumers have preferred to be more frugal in celebration, giving preference to dinners and family meetings), a higher expense for example, in jewelry was noticed, taking advantage in the gold price fall, that has been good to sector. A pull in sales of IT products, including electronics eg much of Hongbao mark is observed, often sent to family and friends across platforms as WeChat and Alipay.
The relative strength of the Yuan allowed Chinese consumers buy high-end items abroad. Many buyers are directed to nearby countries such as Japan and South Korea to buy on duty free luxury goods and electronics. For now, the brands most likely to have benefited from this are the Korean and Japanese beauty ones as Tonymoly, SK-II, and Innisfree and American «accessible luxury» brands as Coach and Michael Kors and within electronics, of course, Apple, although the Chinese labels have increased , for example, smarphone quality and acceptance.
It is often described as the largest movement of people in the world for a period of 40 days, which is what covers the lunar new year (it fell on February 19 this year), during which the surprising number of people travel to meet family to celebrate the event. Officials call this chunyun period or transportation of spring. The term evokes the horror in the minds of many: the trains so crowded that sometimes the only place to sit are the toilets.
According to The Economist this year, the projected number of travel on public transport chunyun, which ended on March 15, was nearly 2.9 billion, an increase of 10% over the same period a year ago. Alibaba through its online travel platform indicates have noticed a huge increase in the number of elderly who travel from their rural homes to industrial, such as the southern city of Guangzhou to spend the holidays with their relatives at industrial cities. This implies that some migrants are now prosperous enough to proudly display their new homes, able to accommodate more family and friends.
The Lunar New Year 2015 is the year of the Ram. Several brands have had to sign this year as an inspiration for products and social campaigns. For the festivities this year, Mulberry designed a special version of its best-selling Mini Cara Delevingne red leather, including a special design for this New Year. The brand only made 88 of handbags, which were available in stores such as Harrods, Galeries Lafayette and store brand on Spring Street in New York.
In addition to this original campaign, the Chinese New Year has also brought inspiration to shareholders of Mulberry who have hired Thierry Andretta as new CEO, ending a yearlong search for a substitute of Bruno Guillon, former CEO.Mulberry has been looking for a CEO since Guillon resigned in March last year after failing to change the negative sales trend. The latest business plan, which included the introduction of bags that cost more than 1200 euros, was counterproductive, causing drop in profits. The company reported a loss before tax of 1.5 million euros for the six months to September, which has provoked change his strategy.
Andretta is an executive with extensive experience, having held senior positions at Lanvin, Moschino and LVMH.«Thierry was the best candidate for CEO»,said the president of Mulberry, Godfrey Davis said in a statement. «He has great experience in the field of fashion and luxury goods and a great ability to drive our ambitious international growth plans».The company needs very much the inspiration and experiece of Andretta to improve its delicate situation…
Disclosure: The author is not responsible for the views expressed in the article. The text has been written freely expressing ideas, without receiving any compensation. The author has no business relationship with any of the companies whose shares are listed in this article.