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Agricultural Development Bank of China
CLASS

Toniolo (LVMH) sees new opportunities for luxury brands

June 09, 2020


Abstract : During the webinar "Experiences from and for China - Ideas to relaunch the business", the manager explained that luxury brands will have to work on more specific products, innovative offers and renewed marketing techniques

MILAN, June 8 (Class Editori) - A dialogue between Italian and Chinese institutions and entrepreneurs on experiences, solutions and best practices to restart after the COVID-19 emergency. This is the goal of the webinar "Experiences from and for China - Ideas to relaunch the business".

"China is resuming, returning to previous production levels and estimates to close 2020 with slight growth. An incredible adaptation to the new circumstances is underway, which makes the country an example for Italy and the whole of Europe", underlined the Italian Ambassador in China, Luca Ferrari. He observed that the current circumstances could represent, in the years to come, the occasion for a further intensification of relations between the two countries. "In the interest of China and Europe, we need to return to a globalized economy, with interconnected supply chains. Globalization can be an instrument for recovery. Especially because it favors the return of tourist flows," added Ferrari.

Moreover, the reopening of borders is a hot topic, which was also discussed by an executive protagonist of the travel retail sector, Gianluca Toniolo, global P&C travel retail managing director for LVMH. Toniolo estimated for the sector a drop in turnover between 40-45% in 2020. "However, thanks to Asia and in particular to China we can be more optimistic," explained the manager, continuing: "Travel-related consumption plays a primary role for the Chinese and is second only to the food sector. We expect a recovery peak between late September and early October, in conjunction with China's national holidays. Inevitably, international travel will come second, at least for several months". This will push luxury brands to strengthen the offer in national markets and reorganize the retail in China, because new locations will emerge to be covered with physical stores.

At the same time, the online business will need to be strengthened. From this point of view, the country is booming and the brands are called to be increasingly present. "We await a rebound in acquisitions starting from the second quarter, but to return to pre-COVID levels we will have to wait for 2022/23. The periods of crisis require optimism in order to be transformed into opportunities, which brands will have to take by studying more specific products, innovative offers and renewed marketing techniques", added Toniolo.

Again, for what concern the fashion sector, Mario Boselli, president of Fondazione Italia Cina, underlined during his speech the importance of sharing strategies between Italy and China. "Over the past 20 years, China has invested in quality and has become the first market for our fashion system, for luxury and for Made in Italy," Boselli stated.

(Source:Class Editori)

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