Top lingerie brands eye bottom-line boost in China
HIGH-END lingerie sales are outpacing China's generally downbeat luxury market, and heating up competition between international brands and local rivals looking to go upmarket.
American brand Victoria's Secret will open its first store.
Rivals, including Italy's ultra-luxury La Perla and Germany's Triumph, are adding branches and moving beyond China's mega-cities to tap a market that has more than doubled in five years to US$18 billion (S$25 billion), according to Mintel Group.
Chinese consumer tastes are maturing, women are more confident about buying for themselves and President Xi Jinping's drive against conspicuous consumption is likely diverting spending from flashy branded bags and accessories to sports and athletic-leisure wear and the more discreet lingerie.
The women's underwear market is expected to have a retail value of US$25 billion by next year - double that of the United States - and will grow to US$33 billion by 2020, according to Euromonitor.
Chinese firms such as Beijing Aimer, Maniform and Ordifen are also targeting higher-end customers.
"That means foreign brands will have to out-compete local brands not just on quality but also innovation," said Matthew Crabbe, director at Mintel.
For now, the market is highly fragmented, with none of the leading firms having more than around a 3 per cent share.
La Perla, which sells bras at around 2,000 yuan (S$400), has eight stores in China and plans additional outlets in Chengdu and Chongqing within the year. It also aims to open a men's store in Beijing.
Victoria's Secret will open a 20,000 sq ft flagship store in Shanghai this year, taking over a prime downtown location that used to house a Louis Vuitton store.
Triumph, which already has 1,000 China stores, plans to open in five new cities this year and up to 11 next year.
Cosmo Lady, a Chinese firm that has focused on the mass market and sold bras from 50 yuan, last year bought Ordifen to increase its presence in the luxury market.