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Just read about the interesting move from Hermes in China. This spring our favourite "orange" brand plans to launch a new brand especially for the Chinese market, which will be called Shang Xia. Shang Xia translates roughly as 'topsy-turvy' or 'upside down' and it’s the first time in Hermès' history that they have launched a luxury brand from grassroots level.
Shang Xia will include ready-to-wear and decorative arts inspired by Chinese culture and traditions of craftsmanship. These are to be made using Chinese raw materials and artisanal know-how.The objective of this move is to offer cheaper products, as well as capitalising on the growth of the luxury market in the country in 2010.
A very interesting concept and market development, considering that Chinese place high premium for "Made in Europe" brands and products, and scoff at locally produced merchandise like Coach, some strands of Armani in the lower end of the price pyramid, Polo Ralph Lauren, etc.
Carefully crafted, it can either prove to be a disaster, or a market bet so forward looking that even i cannot believe it. Because Hermes is privately owned, and can effectively build the brand without necessarily answering to a money and power hungry board of directors who want to cash in, I think they can do it.
Small and niche it might be, but that's the way to go to build the prestige, and even offer a segway into the world of the brand principal - Hermes.
Comments
I think Shang Xia is doing something very historic. Getting it right will be tricky but eventually they will be a global and respected luxury brand. Your point about Hermes being privately held is a very good one, and will likely figure into Shang Xia's success.
One thing, about the name, I spoke to the co-founder about the name and while 'topsy-turvy' is charming, there is a little better way to express it, I think. Shang (top) can represent Heaven and the Past. Xia (bottom) can represent Earth and the Present. The Heaven and Earth theme is very important in Chinese culture as both in harmony create peace and balance. Past and Present are a powerful theme for the brand as they are 'inheriting the past' with their products into the present.
Here are a few photos I took at the store:
http://openkyoto.com/?p=2065