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Defying prevailing pessimism over Hong Kong's economic outlook, Italian designer Giorgio Armani opened a flagship retail outlet in the city on Thursday that expects to thrive on the growing spending power of newly affluent Chinese mainland buyers.
The 2,600-square-meter megastore features Armani's two runway fashion collections - Giorgio Armani and Emporio Armani - a youth-oriented Armani Jeans boutique, cosmetics, home furnishings, books and a cafe.
"This is the beginning of an important expansion in China for the group," said Robert Triefus, the Armani Group's vice president for communications.
The group has a much smaller outlet in Beijing's Palace Hotel and another in the southern boomtown of Shenzhen, which locates near Hong Kong. Triefus said Armani plans to open 20 to 30 outlets on China's mainland in the next five years.
Though Hong Kong's economy is in the doldrums and slack consumer spending has reduced prices for 47 straight months, there is little evidence of that, however, in the central shopping district, which seems to be thriving on the combined spending power of Hong Kong's sizable moneyed class and Chinese mainland visitors.
Tiffany & Co, Salvatore Ferragamo and Louis Vuitton are just down the street, new Prada and Bulgari outlets are neighbors, and a brand new Van Cleef and Arpel shop is under construction nearby.
Though Chinese mainland visitors often scrimp on hotel accommodation, they splash out an average of more than HK$5,000 (US$660) per person per trip, compared with an average HK$4,700 (US$600) spent by other visitors.
And they're not scrounging around local outdoor markets for bargains they can beat back home, but taking back brand name fashions and gold jewelry.
The 4.4 million Chinese mainland tourists who visited Hong Kong last year accounted for about a third of the total 13.7 million visitors. Their numbers have continued to rise this year, as authorities relaxed entry requirements.
To capture that growing market, a new operating company, Giorgio Armani Hong Kong, was set up to serve as a regional base, overseeing distribution and retail operations.
"While China is recognized as having huge potential, that will be realized over time," Triefus said. "Here, we're capturing an international audience and an audience from the China's mainland."
(eastday.com November 2, 2002)
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