Wall Street Breakfast China's luxury conundrum
Oct 21, 2025
Luxury brands in China are pivoting their strategies as GDP weakens, focusing on experiential stores and adapting to regional spending shifts. Younger consumers in lower-tier cities are driving demand, while traditional approaches are evolving. Meanwhile, Warner Bros. Discovery is exploring a potential sale, and Jimmy Kimmel's suspension has surprisingly resulted in millions of Disney subscriber losses. The performance of companies like 3M and Coca-Cola surpassed earnings expectations, showcasing resilience in the current market.
AI Snips
Chapters
Transcript
Episode notes
Luxury Strategies Shift Amid Slowing GDP
- China's luxury market is shifting strategies as GDP growth slows and consumer confidence weakens.
- Brands lean on experiential stores and lower-tier city demand to reach new luxury buyers.
Experiential Stores Attract Provincial Affluence
- Derek Sulger described Louis Vuitton's ship-shaped Shanghai store drawing affluent visitors from other provinces rather than local shoppers.
- Olivia Plotnik noted surprising mall foot traffic in places like Shantou and younger consumers meeting luxury first via Chinese brands.
Lower-Tier Cities Support Luxury Demand
- Panelists said lower-tier cities now sustain luxury spending even as overall consumption cools.
- They argued the slowdown is psychological, not structural, because the money and demand still exist.