BEIJING, May 23, 2011 /PRNewswire/ -- While Gilt is already a household name among online shoppers in the US, the brand, although a relative newcomer to the Chinese market, is already off to a vigorous start. China, with the world's most vibrant market for luxury goods due to its soaring middle-class - already at 50 million and still growing - has a healthy appetite for the better things in life and remains the country with the largest potential for the brand.
In 2011, China has experienced a huge increase in sales of luxury products, placing the country first in terms of speed of growth in the sector. The country is expected to see a year-over-year increase of 25% to 11.5 billion euros in sales of luxury goods this year, according to the Luxury Goods Worldwide Market Study recently released by US-based Bain & Company. In tandem with the rapid overall increase in consumption, tastes, attitudes and demands among Chinese consumers when buying luxury goods are experiencing tremendous changes. Forecasts show the country's online sales of luxury products increased by 30% to between US$4 billion and US$6 billion in five years. The development of luxury e-commerce is clearly on a fast track.
The successful launch and subsequent growth of Vipstore.com, a Red Herring 100 Asia company, directly illustrates the strong purchasing power of Chinese consumers and the unexpected vigor of the online luxury shopping market. Founded in September of 2009, Vipstore.com relies on a strategy of offering limited time specials on branded products. Headquartered in Beijing, with branches in Los Angeles and Paris, it has built a self-owned global commodity supply chain across Europe, North America, Australia, Japan and South Korea. The company now has direct sale agreements with over 500 international luxury brands worldwide, and is racking up monthly sales in the tens of millions of Renminbi after just more than a year in the marketplace. Sales continue to increase 40% monthly.
Another result of the rapidly increasing purchasing power of Chinese consumers is the increasingly expanded categories of consumer products. Surveys show that Chinese luxury consumers now tend to buy a much more diversified range of products and no longer limit themselves to a narrow range of luxury items and brands. Online luxury product buyers' tastes have matured over time and demands are now much higher. Diversification both in terms of products and services are an overall recognition of emerging luxury market and product lines are no longer limited to one brand or one commodity. Chinese consumers are moving beyond just products to showing an interest in luxury services.
As China's largest high-end e-commerce platform providing fashionable products, China's Gilt Vipstore.com is using its strong global buying power to start adding luxury services to its product lineups. The website introduced a leisure travel channel, providing customers with high-end and customized tourism services. The website has expanded beyond its original six categories - cases and bags, wristwatches, shoes, household products, cosmetics and red wines - by adding luxury travel services, in a move to create a new level in terms of expectations among consumers when they travel and build a comprehensive service platform of luxury products and services to meet those expectations.
"Luxury products are able to better show off one's identity and taste. As a result of my work, I have little time to go out and shop yet I love a variety of luxury brands. Shopping on Vipstore.com not only provides me with convenience and helps me save time and money, but also meets my desire to view all of the world's best luxury products in one place and be able to buy a diversified set of products and services," said fashion expert Mr. Wu.
Through the introduction of the travel channel, Vipstore.com has taken the lead in the sector by building a Chinese online global "luxury life" service platform. This is a wide-ranging upgrade to the luxury e-commerce business concept, which, in turn, will accelerate decreases in prices for luxury products and provide Chinese consumers with more diversified choices, further driving the prosperous development of the luxury consumption market.