Luxury giants tap into mainland market

A slowing market

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But observers shouldn't be fooled by the apparent boom, according to Yu Kun, a veteran fashion editor at Cosmopolitan magazine. "China is expecting economic growth of 7.5 percent this year, the lowest for 23 years. There's a very visible slowdown in Chinese demand for luxury goods and expensive products in general," he said in reference to the closure of a number of high-profile department stores in major Chinese cities during the past few years, including several branches of Maison Mode, a name that at one time was synonymous with luxury fashion in Shanghai, and by extension the whole of China.

These setbacks haven't gone unnoticed by the recent arrivals. One clear solution for Lafayette is to reach out and reach down simultaneously.

"Of course, our selection for every Galeries Lafayette store in France and overseas includes luxury and high-end brands, but not only those items," said Chief Executive Laurent Chemla in Beijing. "Obviously, a large middle class is emerging in China and it has expressed a clear interest in trends, designers and new shopping experiences in general."

The man who masterminded the opening of the Beijing store described his price-positioning strategy as a "scissors approach"; "We want to attract people who may not necessarily have high spending power but are passionate about fashion and want to express their individual taste, and also the more mature customers who are looking for luxury items," he said.

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