The CEO of luxury conglomerate LVMH Group, Bernard Arnault, has kicked off his much-anticipated China trip with visits to Louis Vuitton and Dior outlets in Beijing.
Netizens eagerly captured footage of Arnault strolling through LVMH-owned stores with his daughter Delphine, who is managing director at Dior. The accompanying hashtag on China’s Twitter equivalent Weibo has gained almost 300 million views as of June 30, as many netizens are curious about the mogul despite likely falling well outside the tranche of top earners targeted by the conglomerate. The most liked comment under one post on the topic accused LVMH of “cutting leeks”, a slang term for scamming consumers. Some also joked that they wanted to be adopted by Arnault or be married to him.
A China visit from the billionaire has been in the works since the beginning of June amid key strategic shifts for LVMH. The conglomerate is shifting its investment focus from Hong Kong to mainland China, including moving key headquarters and senior businesspeople, and chose Shanghai as the location for its new cosmetics research and development centre, which is its biggest in Asia so far.
Arnault’s trip rounds off a hectic month that saw high-profile visits from foreign business moguls including Bill Gates, Tim Cook, and Elon Musk, as well as a key diplomatic visit from US Secretary of State Antony Blinken. While the flurry of visits has been taken as an encouraging sign for foreign enterprises, Pablo Mauron, managing director for China at Digital Luxury Group, warns against luxury brands taking growth for granted.
“We see that most luxury companies are taking a cautiously optimistic view about this market,” Mauron told the South China Morning Post. “However, there will be challenges ahead, which will necessitate a top-down approach from the brand headquarters, complemented by authentic insights into the local scene.”
Post-pandemic shifts in consumption habits have also led luxury brands to return their focus to top-tier consumers and repeat luxury buyers. Reinventing the luxury experience through offline brand activation intertwined with an emphasis on brands’ cultural legacies is a pillar of this new strategy. To pull this off effectively, LVMH will be keen to stay two steps ahead of cultural trends in this key market.