“Today, luxury is everywhere” (Kapferer and Bastien 2012). Luxury has always existed and this sector is developing itself everywhere around the world. Premium goods and services tend to be not affordable for everyone and this could be an explanation to their fame in the society. However, a democratization of luxury has been observed this last century which gave more market share to the industry. France, took advantage of the situation conquering more and more countries with its reputation and savoir-faire. Emerging countries as China and India, which are also the two biggest countries of the world, could be key markets for luxury products; their populations are craving for them. To feel fashionable, young consumers follow the idea that you need luxury goods (Kapferer and Bastien 2012). Research has been made about the taste of Chinese and Indian population for premium products but a few results demonstrate that they prefer French fashion luxury brands to others. In a second time, young consumers being the future of the economy, the study will be interested in if they purchase French fashion luxury goods, why and how. These fundamental questions lead the study to the research question: “How do young consumers, aged between 18 and 25, perceive French fashion luxury brands in China and India?”.
Literature Review
To have a better understanding of the study, here is a brief taste of what define luxury brands and their customers. The definition of a luxury brand has changed through the last century. The negative connotation of luxury as excessive, extravagance or sinful self-indulgence has changed to a better connotation as a savoir-faire, high quality and a unique industry (Berthon et al. 2009). Walking on the Champs-Elysees, among the Croisette or in Saint-Tropez, it could be believed that there has not been a financial crisis affecting the luxury industry. It is common to see Chinese consumers looking for famous fashion luxury brands as Gucci, Louis Vuitton or Prada in their country and overseas (KPMG 2009 as cited in Tungate 2009). In their book, Boroian and De Poix (2009) highlights that most Indian consumers consider luxury products worth their price and come from overseas.
According to the architecture manager of Printemps store in Paris, Patrizia Pressimone, luxury is all about enjoyment and beauty. It is basics that have evolved, they are higher quality and thus more expensive, however luxury cannot be seen as money but as fine points (Tungate 2009). Reading through the book of Silverstein and Fiske (2008) titled “Trading up: Why Consumers Want New Luxury Goods- and How Companies Create Them” it is possible to learn that American consumers are price sensitive but if the product is high quality, they will pay for it.
The study of Schade et al. (2016), shows that purchasing behaviour differs among age groups and that there is growing evidence around the world that young consumers, aged between 16-25, purchase more luxury items than any other demographic group. The result of the same study demonstrates that young consumers buy luxury goods in a way to support their identity and that they are motivated by the social-adjustive behaviour. Celebrity endorsement could be a reason why young consumers are attracted by luxury products, they identify themselves with famous people; Louis Vuitton appeals to a lot of this age group clients by selling/offering their bags to Rihanna, Kim Kardashian, Lady Gaga and others (Schade et al. 2016).
In Asia, the luxury market tends to be a consumer instead of a manufacturer market (Tungate 2009). India, the second most populated of the world has started to become more open to the concept of luxury. The population, due to better communications and means of transports is more aware to the details of luxury products (Boroian and De Poix 2009). The same authors highlight that this phenomenon comes from an evolution of the country due to the increasing population and a better education. In keeping with Boroain and De Poix (2009), Indian consumers purchase luxury product because they really identify themselves with the creator, which is not the case in China. Indians care about the quality of the products, they do not define luxury product as a necessity (Boroian and De Poix 2009). In China, consumers are craving for luxury goods and well-known brands (Tungate 2009). According to the Financial Times (2005), China has more than 100 million luxury consumers and the country will become the most profitable market for this industry in the world, followed by Japan (Ying Wang et al. 2011). Tungate (2009) adds that China becomes better than Japan when it comes to innovation in the luxury industry. Chinese customers are brand and origin sensitive when it concerns luxury goods; they prefer famous overseas brands and their distinguish logos (Ying Wang et a. 2011). Indian consumers love French fashion luxury as Hermes or Vuitton; in July 2007, Hermes was considered as the biggest by its turnover brand of India, Louis Vuitton’s sales are blowing in Delhi and Mumbai where its bags are sold more than in any other company (Boroian and De Poix 2009). Keeping with this love of made in France, Chinese consumers believe that Paris is the capital of Luxury (Tungate 2009). Louis Vuitton’s sales in China increased by 7% in 2009, after the financial crisis of 2008 (Tungate 2009). These previous statements highlight the potential of the luxury industry in China and India.
Young consumers, aged between 18 and 25 years old, are a key age group for French fashion luxury companies. This segment in India does not mind about spending the equivalent of one month’s salary in non-affordable handbags of shoes. (Boroian and De Poix 2009). Young adult consumers in China have the same tendency to spend the saving money they obtained for luxury products (Ying Wang et al. 2011). These Chineses customers tend to identify themselves with the Western culture and copying their lifestyles and attitudes (Ying Wang et al. 2011). It is clear therefore that young Chinese and Indian consumers are attracted by fashion luxury brands.
Previous research explains this fashionable phenomenon by beliefs and cultural norms in China. For Chinese people, luxury goods are a way to be better considerate in the society; they buy luxury products as gifts for a better recognition from the society, that is why they care also a lot about the packaging (Ying Wang et al. 2011). In addition, the same study shows that purchasing luxury goods for this community has a link with emotions, they buy them with impulse not as an investment. Given this evidence it can be seen that Chinese consumers’ behaviour regarding the purchase of luxury brands has a specific meaning.
To conclude, the popularity of fashion luxury items is increasing in Asian countries like China and India. According to these two countries’ populations, France is likely to be the birthplace of luxury goods and services (Tungate 2009). Louis Vuitton and Hermes seem to be as famous in the Asian continent as they are in Europe. Researches have been made about the Chinese purchase behaviour and their perception to prestigious products. However, few studies have been set up regarding Indians’ way of buying luxury items. Young consumers, the next generation, spend more than any other demographic group but the studies do not highlight if they value more French fashion luxury brands to others. This literature review opens the discussion to these non-covered topics; the luxury brands sell more items to people from the middle-class then to millionaires even if the products are really expensive and not affordable for everyone (Romaniuk and Sharps 2016).
Research Design
The purpose of this section is to establish a plan of action to conduct the research project. This will be a guideline to answer the research questions raised throughout the literature review. The study aims to find out if Chinese and Indian consumers tend to prefer French Luxury brands and why. Its goal is also to target young consumers and understand their purchase behaviour for French luxury brands.
In this research, collecting and analysing the data will permit the researcher to understand better the customer segment chosen and to adapt the companies’ targeted strategies. The research sets out to answer how French fashion luxury brands should improve themselves to better understand their young Chinese and Indians consumers. For this research the data needed will answers from young Indian and Chinese consumers aged between 18 and 25 years old. According to the literature review, this segment is the main market for luxury goods; the researcher wants to investigate how can they afford premium products and why.
As many articles have been written regarding the consumption of luxury goods, this research will develop the hypothesis “Young Chinese and Indian consumers prefer to buy French Fashion luxury brands to others”. Thus, the approach will be deductive: consumer behaviour theories exist so the author wants to test the preceding hypothesis. First, the research will be conducted baes on the theories expressed in the literature review. The second time hypothesises will be established, then, observation and tests (research methods) will be done. Finally, a confirmation or rejection on the hypothesis will be done.
The survey strategy will be adopted for this research study because of the deductive approach of it. The survey strategy aims to answer to “what”, “who”, “where”, “how much” and “how many” questions (Saunders et al. 2016) which is directly linked to the questions raised by the literature review. In addition, the survey strategy allows to provide findings that represent the whole population with statistics and this is less expensive.
For this study, a quantitative study will be set up throughout online questionnaires. This aims to follow the survey strategy. These questionnaires will be sent to young Chinese and Indian consumers that the researcher has already selected. These consumers are relatives or students the researcher has already met; in this way, it makes the research more feasible. Sending the questionnaires with the internet will be the easiest way to collect answers from these geographically far away populations. The sample studied will be Chinese and Indian consumers aged between 18 and 25 years old, both male and female. The researcher will try to get as many answers from Chinese and Indian consumers and from males and females to draw conclusions from the results. However, there are certain drawbacks associated with the sample size because of the timing and the poor reply rate for online questionnaires. The timing being limited and not being close to these populations, the author will try to collect 40 answers.
Conclusion
In this research proposal, secondary data critically analysed throughout the literature review has permitted a better understanding of the study and which research have been made about it. The evidence seems to indicate that Indian and Chinese consumers are not only purchasing fashion luxury goods but they are craving for it. In addition, it has been observed by other authors’ work that these consumers do admire the French culture and fashion luxury goods related to it. It is also clear that young consumers, both Chinese and Indian, are the biggest segment market for fashion luxury products. However, previous studies do not consider the consumer behaviour of India consumers in this market. The research design has aimed to plan the research approach, strategy and method of the study. A data will be collected in order to answer the main research question: “How do young consumers, aged between 18 and 25, perceive French fashion luxury brands in China and India?”. For that, a deductive approach and a survey strategy will be established via an online questionnaire. This questionnaire will be sent to a selected data from China and India aged between 18 and 25 years old.